Form
for
Compliance
with
E.
O.
12866
Docket
Requirements
Title
of
Regulation:
Final
Regulations
to
Establish
Requirements
for
Cooling
Water
Intake
Structures
at
Phase
III
Facilities
Contact
person:
Paul
Shriner
Phone
number:
202­
566­
1076
Was
this
regulation
reviewed
by
OMB
under
Executive
Order
12866
­
Regulatory
Planning
and
Review?

xYes
9
No
If
you
checked
"
no",
you
are
done
with
this
form.
Simply
place
it
in
the
docket
for
your
regulation.
If
you
checked
"
yes",
please
fill
out
the
remainder
of
the
form
before
placing
it
in
the
docket.
Also
docket
any
relevant
documents
referenced
in
the
form.

For
regulations
that
are
checked
"
Yes"
above:

This
regulation
was
reviewed
by
OMB
under
Executive
Order
12866
­
Regulatory
Planning
and
Review.

Attached
is
the
draft
regulation
and
any
other
documents
sent
to
OMB
for
review,
such
as
analyses
and
assessments.
E.
O.
12866
requires
agencies
to
make
these
publicly
available.

E.
O.
12866
also
requires
agencies
to
identify
the
substantive
changes
between
the
draft
regulation
sent
to
OMB
for
review
and
the
regulation
subsequently
announced
[
Please
check
the
appropriate
box
below:]

X
EPA
made
substantive
changes
to
this
regulation
(
includes
changes
initiated
by
EPA
or
OMB).
Attached
is
a
document
which:
(
1)
identifies
all
the
substantive
changes
made,
and
(
2)
notes
those
changes
OMB
suggested
or
recommended.

No
substantive
changes
were
made
to
this
regulation
Therefore,
no
further
attachments
are
required.

If
you
have
questions
about
this
regulation,
please
call
the
EPA
contact
person
listed
above.
Section
316(
b)
Phase
III
Final
Rule
Summary
of
Substantive
Changes
During
Interagency
Review
Changes
to
Rule
Language
125.139(
c)(
3)
 
OMB
recommended
EPA
strike
"
and
daily"
from
third
sentence
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
1
ENVIRONMENTAL
PROTECTION
AGENCY
40
CFR
Parts
9,
122,
123,
124,
and
125
[
OW­
2004­
0002,
FRL
 
XXXX]

RIN
2040 
AD70
National
Pollutant
Discharge
Elimination
System
 
Final
Regulations
to
Establish
Requirements
for
Cooling
Water
Intake
Structures
at
Phase
III
Facilities
AGENCY:
Environmental
Protection
Agency
(
EPA).

ACTION:
Final
rule.

SUMMARY:
On
November
1,
2004,
EPA
published
a
proposal
that
contained
several
options
for
the
control
of
cooling
water
intake
structures
at
existing
Phase
III
facilities
and
at
new
offshore
oil
and
gas
extraction
facilities.
This
rule
establishes
categorical
section
316(
b)
requirements
for
new
offshore
oil
and
gas
extraction
facilities
that
have
a
design
intake
flow
threshold
of
greater
than
2
million
gallons
per
day
and
that
withdraw
at
least
25
percent
of
the
water
exclusively
for
cooling
purposes.
For
existing
Phase
III
facilities,
EPA
determined
that
uniform
national
standards
are
not
the
most
effective
way
at
this
time
to
address
cooling
water
intake
structures
at
these
facilities.
Instead,
EPA
believes
that
it
is
better
to
continue
to
rely
upon
the
existing
National
Pollutant
Discharge
Elimination
System
(
NPDES)
program,
which
implements
section
316(
b)
for
existing
facilities
not
covered
under
the
Phase
II
rule
on
a
case­
by­
case,
best
professional
judgment
basis.
This
final
action
constitutes
Phase
III
of
EPA's
section
316(
b)
regulation
development.
This
rule
does
not
alter
the
regulatory
requirements
for
facilities
subject
to
the
Phase
I
or
Phase
II
regulations.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
2
DATES:
This
regulation
is
effective
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER].
For
judicial
review
purposes,
this
final
rule
is
promulgated
as
of
1
p.
m.
Eastern
Daylight
Time
(
EDT)
on
[
INSERT
DATE
14
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER]
as
provided
in
40
CFR
23.2.

ADDRESSES:
EPA
has
established
a
docket
for
this
action
under
Docket
ID
No.

EPAOW
2004­
0002.
All
documents
in
the
docket
are
listed
on
the
www.
regulations.
gov
web
site.
Although
listed
in
the
index,
some
information
is
not
publicly
available,
e.
g.,

confidential
business
information
(
CBI)
or
other
information
whose
disclosure
is
restricted
by
statute.
Certain
other
material,
such
as
copyrighted
material,
is
not
placed
on
the
Internet
and
will
be
publicly
available
only
in
hard
copy
form.
Publicly
available
docket
materials
are
available
either
electronically
through
www.
regulations.
gov
or
in
hard
copy
at
the
Water
Docket
in
the
EPA
Docket
Center,
EPA/
DC,
EPA
West,
Room
B102,
1301
Constitution
Ave.,
NW,
Washington,
DC.
The
Public
Reading
Room
is
open
from
8:
30
a.
m.
to
4:
30
p.
m.,
Monday
through
Friday,
excluding
legal
holidays.
The
telephone
number
for
the
Public
Reading
Room
is
(
202)
566­
1744,
and
the
telephone
number
for
the
Water
Docket
is
(
202)
566­
2426.

FOR
FURTHER
INFORMATION
CONTACT:
For
additional
technical
information
contact
Paul
Shriner,
OW/
OST
at
(
202)
566­
1076.
For
additional
biological
information
contact
Ashley
Allen,
OW/
OST
at
(
202)
566­
1012.
The
address
for
the
above
contacts
is:
Office
of
Science
and
Technology,
Engineering
Analysis
Division
(
Mailcode
4303T),

Environmental
Protection
Agency,
1200
Pennsylvania
Ave.,
NW.,
Washington,
DC
20460;
fax
number:
(
202)
566­
1053;
e­
mail
address:
rule.
316b@
epa.
gov.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
3
SUPPLEMENTARY
INFORMATION:

I.
General
Information
A.
What
Entities
Are
Regulated
By
This
Action?

This
final
rule
applies
to
new
offshore
and
coastal
oil
and
gas
extraction
facilities,

which
were
specifically
excluded
from
the
Phase
I
new
facility
rule.
New
offshore
and
coastal
oil
and
gas
extraction
facilities
with
a
design
intake
flow
threshold
of
greater
than
2
million
gallons
per
day
(
MGD)
are
subject
to
requirements
similar
to
those
under
the
Phase
I
rule.
A
new
offshore
and
coastal
oil
and
gas
extraction
facility
is
defined
as
any
building,
structure,
facility,
or
installation
that
(
1)
meets
the
definition
of
a
"
new
facility"

in
40
CFR
125.83;
(
2)
is
regulated
by
the
Offshore
and
Coastal
Subcategories
of
the
Oil
and
Gas
Extraction
Point
Source
Category
Effluent
Guidelines
in
40
CFR
435.10
or
435.40;
and
(
3)
but
only
if
it
commences
construction
after
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER].
Exhibit
I­
1
provides
examples
of
other
industrial
facility
types
potentially
interested
in
this
final
action.

Exhibit
I­
1 
Industrial
Facility
Types
Potentially
Interested
in
this
Final
Action
Category
Examples
of
Potentially
Regulated
Entities
Standard
Industrial
Classification
Codes
North
American
Industry
Codes
(
NAIC)

Federal,
State
and
local
government
Operators
of
steam
electric
generating
point
source
dischargers
that
employ
cooling
water
intake
structures
4911
and
493
221111,
221112,
221113,
221119,
221121,
221122
Operators
of
industrial
point
source
dischargers
that
employ
cooling
water
intake
structures.
See
below
See
below
Agricultural
production
0133
111991
11193
Industry
Metal
mining
1011
21221
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
4
Category
Examples
of
Potentially
Regulated
Entities
Standard
Industrial
Classification
Codes
North
American
Industry
Codes
(
NAIC)

Oil
and
gas
extraction
1311,
1321
211111,
211112
Mining
and
quarrying
of
nonmetallic
minerals
1474
212391
Food
and
kindred
products
2046,
2061,
2062,
2063,
2075,
2085
311221,
311311,
311312,
311313,
311222,
311225,
31214
Tobacco
products
2141
312229,
31221
Textile
mill
products
2211
31321
Lumber
and
wood
products,
except
furniture
2415,
2421,
2436,
2493
321912,321113,
321918,
321999,
321212,
321219
Paper
and
allied
products
2611,
2621,
2631,
2676
3221,
322121,
32213,
322121,
322122,
32213,
322291
Chemical
and
allied
products
28
(
except
2895,
2893,
2851,
and
2879)
325
(
except
325182,
32591,
32551,
32532)

Petroleum
refining
and
related
industries
2911,
2999
32411,
324199
Rubber
and
miscellaneous
plastics
products
3011,
3069
326211,
31332,
326192,
326299
Stone,
clay,
glass,
and
concrete
products
3241
32731
Primary
metal
industries
3312,
3313,
3315,
3316,
3317,
3334,
3339,
3353,
3363,
3365,
3366
324199,
331111,
331112,
331492,
331222,
332618,
331221,
22121,
331312,
331419,
331315,
331521,
331524,
331525
Fabricated
metal
products,
except
machinery
and
transportation
equipment
3421,
3499
332211,
337215,
332117,
332439,
33251,
332919,
339914,
332999
Industrial
and
commercial
machinery
and
computer
equipment
3523,
3531
333111,
332323,
332212,
333922,
22651,
333923,
33312
Transportation
equipment
3724,
3743,
3764
336412,
333911,
33651,
336416
Measuring,
analyzing,
and
controlling
instruments;
photographic,
medical,
and
optical
goods;
watches
and
clocks
3861
333315,
325992
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
5
Category
Examples
of
Potentially
Regulated
Entities
Standard
Industrial
Classification
Codes
North
American
Industry
Codes
(
NAIC)

Electric,
gas,
and
sanitary
services
4911,
4931,
4939,
4961
221111,
221112,
221113,
221119,
221121,
221122,
22121,
22133
Educational
services
8221
61131
Engineering,
accounting,
research,
management
and
related
services
8731
54171
This
exhibit
is
not
intended
to
be
exhaustive,
but
rather
provides
a
guide
for
readers
regarding
entities
likely
to
be
interested
in
this
action.
This
exhibit
also
lists
the
types
of
entities
that
EPA
is
now
aware
could
potentially
be
regulated
by
this
action.

Other
types
of
entities
not
listed
in
the
exhibit
could
also
be
regulated.
To
determine
whether
your
facility
is
regulated
by
this
action,
you
should
carefully
examine
the
applicability
criteria
in
§
125.131
of
this
rule.
If
you
have
questions
regarding
the
applicability
of
this
action
to
a
particular
entity,
consult
the
persons
listed
for
technical
information
in
the
FOR
FURTHER
INFORMATION
CONTACT
section.

B.
Supporting
Documentation
The
final
regulation
is
supported
by
three
major
documents:

1.
Economic
and
Benefits
Analysis
for
the
Final
Section
316(
b)
Phase
III
Existing
Facilities
Rule
(
EPA 
821­
R­
06­
001),
hereafter
referred
to
as
the
Economic
and
Benefits
Analysis.
This
document
presents
the
methodology
employed
to
assess
economic
impacts
of
the
options
we
considered
for
this
action
and
the
results
of
the
analysis.

2.
Regional
Analysis
for
the
Final
Section
316(
b)
Phase
III
Existing
Facilities
Rule
(
EPA 
821­
R­
06­
002),
hereafter
referred
to
as
the
Regional
Analysis
Document.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
6
This
document
examines
cooling
water
intake
structure
impacts
and
the
environmental
benefits
of
the
national
categorical
regulatory
options
we
considered
for
this
action
at
the
regional
level.

3.
Technical
Development
Document
for
the
Final
Section
316(
b)
Phase
III
Existing
Facilities
Rule
(
EPA 
821­
R­
06­
003),
hereafter
referred
to
as
the
Technical
Development
Document.
This
document
presents
the
technical
information
that
formed
the
basis
for
our
decisions
in
this
action,
including
information
on
the
costs
and
performance
of
the
impingement
and
entrainment
reduction
technologies
we
considered.

Table
of
Contents
I.
General
Information
II.
Scope
and
Applicability
of
the
Final
Rule
III.
Legal
Authority,
Purpose,
and
Background
of
This
Regulation
IV.
Environmental
Impacts
Associated
with
Cooling
Water
Intake
Structures
V.
Description
of
the
Rule
VI.
Basis
for
the
Final
Rule
Decision
VII.
Summary
of
Major
Comments
and
Responses
to
the
Proposed
Rule
and
Notice
of
Data
Availability
(
NODA)

VIII.
Implementation
IX.
Economic
Impact
Analysis
X.
Benefits
Analysis
XI.
Comparison
of
Benefits
and
Costs
XII.
Statutory
and
Executive
Order
Reviews
Interagency
Review
Draft­­
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or
distribute
7
II.
Scope
and
Applicability
of
the
Final
Rule
The
national
categorical
requirements
in
this
rule
apply
to
new
offshore
oil
and
gas
extraction
facilities,
which
were
specifically
excluded
from
the
Phase
I
new
facility
rule.
(
40
CFR
Part
125,
Subpart
I).
This
rule
defines
the
term
"
new
offshore
oil
and
gas
extraction
facility"
to
include
facilities
in
both
the
offshore
and
the
coastal
subcategories
of
EPA's
Oil
and
Gas
Extraction
Point
Source
Category
for
which
effluent
limitations
are
established
at
40
CFR
Part
435.
Although
the
term
"
offshore"
denotes
only
one
of
these
two
subcategories
for
purposes
of
the
effluent
guidelines,
EPA
is
using
the
term
"
offshore"
here
to
denote
facilities
in
either
subcategory
because
the
requirements
are
the
same
for
both
offshore
and
coastal
facilities
and
the
term
"
offshore"
is
commonly
understood
to
include
any
facilities
not
located
on
land.
In
order
to
be
covered
by
this
rule,
these
facilities
would
need
to
use
cooling
water
intake
structures
to
withdraw
water
from
waters
of
the
U.
S.
and
meet
all
other
applicability
criteria,
as
described
in
this
section.

New
facilities
that
meet
all
of
the
following
criteria
are
subject
to
this
rule:

 
The
facility
is
a
point
source;

 
The
facility
proposes
to
use
cooling
water
intake
structures,
including
a
cooling
water
intake
structure
operated
by
one
or
more
independent
suppliers
(
other
than
a
public
water
system),
with
a
total
design
intake
flow
equal
to
or
greater
than
2
million
gallons
per
day
(
MGD)
to
withdraw
cooling
water
from
waters
of
the
United
States;

 
The
facility
uses
at
least
25
percent
of
water
withdrawn
exclusively
for
cooling
purposes,
measured
on
an
average
monthly
basis.
Interagency
Review
Draft­­
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06­­
Deliberative:
do
not
cite,
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or
distribute
8
For
the
purposes
of
this
rule,
a
new
facility
is
a
point
source
if
it
has,
or
is
required
to
have,
an
NPDES
permit.
If
a
new
facility
is
a
point
source
that
uses
a
cooling
water
intake
structure,
but
does
not
meet
the
applicable
design
intake
flow/
source
waterbody
threshold
or
the
25
percent
cooling
water
use
threshold,
it
would
continue
to
be
subject
to
permit
conditions
implementing
CWA
section
316(
b)
set
by
the
permit
director
on
a
caseby
case,
best
professional
judgment
basis.
Section
II.
A
of
the
preamble
discusses
what
constitutes
a
"
new"
offshore
oil
and
gas
extraction
facility
for
purposes
of
the
section
316(
b)
Phase
III
rule.
Requirements
for
new
offshore
oil
and
gas
extraction
facilities
are
specified
in
40
CFR
Subpart
N.

Existing
Phase
III
facilities,
including
manufacturing
facilities,
electric
power
producers
with
a
design
intake
flow
(
DIF)
less
than
50
MGD,
and
existing
offshore
oil
and
gas
extraction
facilities,
are
not
subject
to
the
national
categorical
requirements
of
this
final
rule.
These
facilities
will
continue
to
be
regulated
on
a
case­
by­
case
basis
using
a
permit
director's
best
professional
judgment.

Finally,
this
rule
does
not
establish
national
categorical
requirements
for
seafood
processing
vessels
or
offshore
liquefied
natural
gas
import
terminals.
Those
facilities
would
be
subject
to
permit
conditions
implementing
CWA
section
316(
b)
set
by
the
permit
director
on
a
case­
by­
case,
best
professional
judgment
basis
where
the
facility
is
a
point
source
and
uses
a
cooling
water
intake
structure.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
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or
distribute
9
A.
What
is
a
"
New"
Offshore
Oil
and
Gas
Extraction
Facility
for
Purposes
of
the
Section
316(
b)
Phase
III
Rule?

For
purposes
of
this
rule,
new
offshore
oil
and
gas
extraction
facilities
are
those
facilities
that
1)
are
subject
to
the
Offshore
and
Coastal
Subcategories
of
the
Oil
and
Gas
Extraction
Point
Source
Category
Effluent
Guidelines
(
i.
e.,
40
CFR
435.10
Offshore
Subcategory
or
40
CFR
435.40
Coastal
Subcategory);
2)
that
commence
construction
after
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER];
and
3)
that
meet
the
definition
of
a
"
new
facility"
in
40
CFR
125.83.
New
offshore
oil
and
gas
extraction
facilities
were
not
subject
to
the
Phase
I
new
facility
rule,
but
rather,
are
subject
to
requirements
under
this
Phase
III
rule.
Therefore,

the
date
for
distinguishing
new
offshore
oil
and
gas
extraction
facilities
from
existing
ones
is
the
effective
date
of
the
final
Phase
III
rule.
The
definition
of
new
facility
may
be
found
at
40
CFR
125.83.1
For
a
discussion
of
this
definition,
see
66
FR
65256,
65258­

59,
65785­
87
(
December
18,
2001)
and
69
FR
41576,
41578­
80
(
July
9,
2004).

1
The
Phase
I
rule
listed
examples
of
facilities
that
would
be
"
new"
facilities
and
facilities
that
would
"
not
be
considered
a
`
new
facility'"
in
two
numbered
paragraphs.
These
read
as
follows:
"(
1)
Examples
of
`
new
facilities'
include,
but
are
not
limited
to:
the
following
scenarios:
(
i)
A
new
facility
is
constructed
on
a
site
that
has
never
been
used
for
industrial
or
commercial
activity.
It
has
a
new
cooling
water
intake
structure
for
its
own
use.
(
ii)
A
facility
is
demolished
and
another
facility
is
constructed
in
its
place.
The
newlyconstructed
facility
uses
the
original
facility's
cooling
water
intake
structure,
but
modifies
it
to
increase
the
design
capacity
to
accommodate
the
intake
of
additional
cooling
water.
(
iii)
A
facility
is
constructed
on
the
same
property
as
an
existing
facility,
but
is
a
separate
and
independent
industrial
operation.
The
cooling
water
intake
structure
used
by
the
original
facility
is
modified
by
constructing
a
new
intake
bay
for
the
use
of
the
newly
constructed
facility
or
is
otherwise
modified
to
increase
the
intake
capacity
for
the
new
facility.
(
2)
Examples
of
facilities
that
would
not
be
considered
a
`
new
facility'
include,
but
are
not
limited
to,
the
following
scenarios:
(
i)
A
facility
in
commercial
or
industrial
operation
is
modified
and
either
continues
to
use
its
original
cooling
water
intake
structure
or
uses
a
new
or
modified
cooling
water
intake
structure.
(
ii)
A
facility
has
an
existing
intake
structure.
Another
facility
(
a
separate
and
independent
industrial
operation),
is
constructed
on
the
same
property
and
connects
to
the
facility's
cooling
water
intake
structure
behind
the
intake
pumps,
and
the
design
capacity
of
the
cooling
water
intake
structure
has
not
been
increased.
This
facility
would
not
be
considered
a
`
new
facility'
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
10
The
determination
of
whether
a
facility
is
"
new"
or
"
existing"
is
focused
on
the
point
source
discharger
 
not
on
the
cooling
water
intake
structure.
In
other
words,

modifications
or
additions
to
the
cooling
water
intake
structure
(
or
even
the
total
replacement
of
an
existing
cooling
water
intake
structure
with
a
new
one)
does
not
convert
an
otherwise
unchanged
existing
facility
into
a
new
facility,
regardless
of
the
purpose
of
such
changes.
Rather,
the
determination
as
to
whether
a
facility
is
new
or
existing
focuses
first
on
the
point
source
itself,
i.
e.,
whether
it
is
a
greenfield
facility
or
a
stand­
alone
facility.

B.
What
is
"
Cooling
Water"
and
What
is
a
"
Cooling
Water
Intake
Structure?"

This
rule
adopts
the
same
definition
of
a
"
cooling
water
intake
structure"
that
applies
to
new
facilities
under
the
final
Phase
I
rule
and
existing
facilities
under
the
final
Phase
II
rule.
Under
this
final
rule,
a
cooling
water
intake
structure
is
defined
as
the
total
physical
structure
and
any
associated
constructed
waterways
used
to
withdraw
cooling
water
from
waters
of
the
Unites
States.
Under
this
definition,
the
cooling
water
intake
structure
extends
from
the
point
at
which
water
is
withdrawn
from
the
surface
water
source
up
to
and
including
the
intake
pumps.
This
rule
also
adopts
the
definition
of
"
cooling
water"
used
in
the
Phase
I
and
Phase
II
rules:
water
used
for
contact
or
noncontact
cooling,
including
water
used
for
equipment
cooling,
evaporative
cooling
tower
makeup,
and
dilution
of
effluent
heat
content.
The
definition
specifies
that
the
intended
use
of
cooling
water
is
to
absorb
waste
heat
rejected
from
the
processes
used
or
auxiliary
operations
on
the
facility's
premises.
Consistent
with
the
Phase
I
and
Phase
II
even
if
routine
maintenance
or
repairs
that
do
not
increase
the
design
capacity
were
performed
on
the
intake
structure."
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
11
rules,
only
the
water
used
exclusively
for
cooling
purposes
is
to
be
counted
when
determining
whether
the
25
percent
threshold
in
§
125.131(
a)(
2)
is
met.

C.
Would
My
Facility
Be
Covered
if
It
is
a
Point
Source
Discharger?

This
rule
applies
only
to
facilities
that
have
an
NPDES
permit
or
are
required
to
obtain
one.
This
is
the
same
requirement
EPA
included
in
the
Phase
I
and
Phase
II
final
rules
(
see,
40
CFR
125.81(
a)(
1),
and
40
CFR
125.91(
a)(
1),
respectively).
Requirements
for
complying
with
section
316(
b)
will
continue
to
be
applied
through
NPDES
permits.

The
Agency
also
recognizes
that
some
facilities
that
have
or
are
required
to
have
an
NPDES
permit
might
not
own
and
operate
the
intake
structure
that
supplies
their
facility
with
cooling
water.
For
example,
facilities
operated
by
separate
entities
might
be
located
on
the
same,
adjacent,
or
nearby
property(
ies);
one
of
these
facilities
might
take
in
cooling
water
and
then
transfer
it
to
other
facilities
prior
to
discharge
of
the
cooling
water
to
a
water
of
the
United
States.
Section
125.92(
c)
of
this
rule
addresses
such
a
situation.
It
provides
that
use
of
a
cooling
water
intake
structure
includes
obtaining
cooling
water
by
any
sort
of
contract
or
arrangement
with
one
or
more
independent
suppliers
of
cooling
water
if
the
supplier
withdraws
water
from
waters
of
the
United
States.
This
provision
is
intended
to
prevent
new
Phase
III
facilities
from
circumventing
the
requirements
of
this
rule
by
creating
arrangements
to
receive
cooling
water
from
an
entity
that
is
not
itself
subject
to
the
requirements
of
Phase
III.
EPA
expects
that
a
facility
that
is
otherwise
subject
to
the
requirements
of
Phase
I
and
that
is
an
independent
supplier
to
a
Phase
III
facility
would
still
be
subject
to
the
requirements
of
Phase
I.
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
12
D.
When
Would
a
New
Offshore
Oil
and
Gas
Extraction
Facility
Be
Required
to
Comply
With
Any
New
316(
b)
Requirements?

This
final
rule
will
become
effective
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER].
After
that
date,
new
offshore
oil
and
gas
extraction
Phase
III
facilities
will
need
to
comply
when
an
NPDES
permit
containing
requirements
consistent
with
this
rule
is
issued
to
the
facility
(
see
§
125.132).

Under
current
NPDES
program
regulations,
this
will
occur
when
a
new
NPDES
permit
is
issued
or
when
an
existing
NPDES
permit
is
issued,
reissued,
or
modified
or
revoked
and
reissued.

A
discussion
of
the
timing
of
implementation
of
this
rule
is
provided
in
section
VIII.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
13
III.
Legal
Authority,
Purpose,
and
Background
of
This
Final
Regulation
A.
Legal
Authority
This
action
is
issued
under
the
authority
of
sections
101,
301,
308,
316,
401,
402,

501,
and
510
of
the
Clean
Water
Act
(
CWA),
33
U.
S.
C.
1251,
1311,
1318,
1326,
1341,

1342,
1361,
and
1370.
Publication
of
this
action
fulfills
an
obligation
of
the
U.
S.

Environmental
Protection
Agency
(
EPA)
under
a
consent
decree
in
Riverkeeper,
Inc.
v.

Johnson,
No.
93
Civ.
0314,
(
S.
D.
N.
Y).

B.
Purpose
of
This
Regulation
Section
316(
b)
of
the
CWA
provides
that
any
standard
established
pursuant
to
section
301
or
306
of
the
CWA
and
applicable
to
a
point
source
must
require
that
the
location,
design,
construction,
and
capacity
of
cooling
water
intake
structures
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact.
This
rule
establishes
requirements
that
apply
to
new
offshore
oil
and
gas
extraction
facilities
that
have
a
design
intake
flow
threshold
of
greater
than
2
MGD.
This
is
the
same
design
intake
flow
threshold
for
new
facilities
in
the
Phase
I
rule.
To
be
covered,
a
facility
would
need
to
use
at
least
25
percent
of
the
water
withdrawn
exclusively
for
cooling
purposes
and
meet
other
specified
criteria
in
order
to
be
within
the
scope
of
the
rule
(
see
section
II
 
Scope
and
Applicability
of
Final
Rule).
In
this
action,
EPA
is
not
promulgating
any
new
section
316(
b)
requirements
for
existing
facilities.
Therefore,

existing
facilities
that
are
not
covered
by
the
Phase
II
rule
(
Phase
II
is
described
in
section
III.
C.
5
of
this
preamble)
must
continue
to
meet
requirements
under
Section
316(
b)
of
the
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
14
CWA
determined
by
the
permitting
authority
on
a
case­
by­
case,
best
professional
judgment
(
BPJ)
basis.
See
40
CFR
125.90(
b).

C.
Background
1.
The
Clean
Water
Act
The
Federal
Water
Pollution
Control
Act,
also
known
as
the
Clean
Water
Act
(
CWA),
33
U.
S.
C.
1251
et
seq.,
seeks
to
"
restore
and
maintain
the
chemical,
physical,

and
biological
integrity
of
the
nation's
waters."
33
U.
S.
C.
1251(
a).
The
CWA
establishes
a
comprehensive
regulatory
program,
key
elements
of
which
are
1)
a
prohibition
on
the
discharge
of
pollutants
from
point
sources
to
waters
of
the
United
States,
except
as
authorized
by
the
statute;
2)
authority
for
EPA
or
authorized
States
or
Tribes
to
issue
National
Pollutant
Discharge
Elimination
System
(
NPDES)
permits
that
regulate
the
discharge
of
pollutants;
and
3)
requirements
for
limitations
in
NPDES
permits
based
on
effluent
limitations
guidelines
and
standards
and
water
quality
standards.

Section
316(
b)
addresses
the
adverse
environmental
impact
caused
by
the
intake
of
cooling
water,
not
discharges
into
water.
Despite
this
special
focus,
the
requirements
of
section
316(
b)
are
closely
linked
to
several
of
the
core
elements
of
the
NPDES
permit
program
established
under
section
402
of
the
CWA
to
control
discharges
of
pollutants
into
navigable
waters.
For
example,
while
effluent
limitations
apply
to
the
discharge
of
pollutants
by
NPDES­
permitted
point
sources
to
waters
of
the
United
States,
section
316(
b)
applies
to
facilities
subject
to
NPDES
requirements
that
withdraw
water
from
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
15
waters
of
the
United
States
for
cooling
and
that
use
a
cooling
water
intake
structure
to
do
so.

Section
301
of
the
CWA
prohibits
the
discharge
of
any
pollutant
by
any
person,

except
in
compliance
with
specified
statutory
requirements,
including
section
402.

Section
402
of
the
CWA
provides
authority
for
EPA
or
an
authorized
State
or
Tribe
to
issue
an
NPDES
permit
to
any
person
discharging
any
pollutant
or
combination
of
pollutants
from
a
point
source
into
waters
of
the
United
States.
Forty­
five
States
and
one
U.
S.
territory
are
currently
authorized
under
section
402(
b)
to
administer
the
NPDES
permitting
program.
NPDES
permits
restrict
the
types
and
amounts
of
pollutants,

including
heat,
that
may
be
discharged
from
various
industrial,
commercial,
and
other
sources
of
wastewater.
These
permits
control
the
discharge
of
pollutants
primarily
by
requiring
dischargers
to
meet
effluent
limitations
established
pursuant
to
section
301
or
section
306.
Effluent
limitations
may
be
based
on
Federal
effluent
limitations
guidelines,

new
source
performance
standards,
or
the
best
professional
judgment
of
the
permit
writer.

Limitations
based
on
these
guidelines,
standards,
or
best
professional
judgment
are
known
as
technology­
based
effluent
limits.
Where
technology­
based
effluent
limits
are
inadequate
to
ensure
attainment
of
water
quality
standards
applicable
to
the
receiving
water,
section
301(
b)(
1)(
C)
of
the
CWA
requires
permits
to
include
more
stringent
limits
based
on
applicable
water
quality
standards.
NPDES
permits
also
routinely
include
monitoring
and
reporting
requirements,
and
other
conditions,
including
conditions
to
implement
the
requirements
of
section
316(
b).

Section
510
of
the
CWA
provides
that,
except
as
provided
in
the
CWA,
nothing
in
the
Act
shall
preclude
or
deny
the
right
of
any
State
or
political
subdivision
thereof
to
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
16
adopt
or
enforce
any
requirement
respecting
control
or
abatement
of
pollution;
except
that
if
a
limitation,
prohibition
or
standard
of
performance
is
in
effect
under
the
CWA,

such
State
or
political
subdivision
may
not
adopt
or
enforce
any
other
limitation,

prohibition
or
standard
of
performance
which
is
less
stringent
than
the
limitation,

prohibition
or
standard
of
performance
under
the
Act.
EPA
interprets
this
to
reserve
for
the
States
authority
to
implement
requirements
that
are
more
stringent
than
the
Federal
requirements
under
State
law.
PUD
No.
1
of
Jefferson
County
v.
Washington
Dep't
of
Ecology,
511
U.
S.
700,
705
(
1994).

Under
sections
301,
304,
and
306
of
the
CWA,
EPA
issues
effluent
limitations
guidelines
and
new
source
performance
standards
for
categories
of
industrial
dischargers
based
on
the
pollutants
of
concern
discharged
by
the
industry,
the
degree
of
control
that
can
be
attained
using
various
levels
of
pollution
control
technology,
consideration
of
economics,
as
appropriate
to
each
level
of
control,
and
other
factors
identified
in
sections
304
and
306
of
the
CWA.
EPA
has
promulgated
regulations
setting
effluent
limitations
guidelines
and
standards
under
sections
301,
304,
and
306
of
the
CWA
for
more
than
50
industries.
See
40
CFR
Parts
405
through
471.
EPA
has
established
effluent
limitations
guidelines
and
standards
that
apply
to
most
of
the
industry
categories
that
use
cooling
water
intake
structures
(
e.
g.,
steam
electric
power
generation,
iron
and
steel
manufacturing,
pulp
and
paper
manufacturing,
petroleum
refining,
and
chemical
manufacturing).

Section
316(
b)
states,
in
full:

Any
standard
established
pursuant
to
section
301
or
section
306
of
[
the
Clean
Water]
Act
and
applicable
to
a
point
source
shall
require
that
the
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
17
location,
design,
construction,
and
capacity
of
cooling
water
intake
structures
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact.

The
phrase
"
best
technology
available"
in
CWA
section
316(
b)
is
not
defined
in
the
statute,
but
its
meaning
can
be
understood
in
light
of
similar
phrases
used
elsewhere
in
the
CWA.
See
Riverkeeper
v.
EPA,
slip
op.
at
11
(
2nd
Cir.
Feb.
3,
2004)
(
noting
that
the
cross­
reference
in
CWA
section
316(
b)
to
CWA
section
306
"
is
an
invitation
to
look
to
section
306
for
guidance
in
discerning
what
factors
Congress
intended
the
EPA
to
consider
in
determining
`
best
technology
available'"
for
new
sources.)

In
sections
301
and
306,
Congress
directed
EPA
to
set
effluent
discharge
standards
for
new
sources
based
on
the
"
best
available
demonstrated
control
technology"

and
for
existing
sources
based
on
the
"
best
available
technology
economically
achievable."
For
new
sources,
section
306(
b)(
1)(
B)
directs
EPA
to
establish
"
standards
of
performance."
The
phrase
"
standards
of
performance"
under
section
306(
a)(
1)
is
defined
as
being
the
effluent
reduction
that
is
"
achievable
through
application
of
the
best
available
demonstrated
control
technology,
processes,
operating
methods
or
other
alternatives.
.
.
.
"
This
is
commonly
referred
to
as
"
best
available
demonstrated
technology"
or
"
BADT."
For
existing
dischargers,
section
301(
b)(
1)(
A)
requires
the
establishment
of
effluent
limitations
based
on
"
the
application
of
best
practicable
control
technology
currently
available."
This
is
commonly
referred
to
as
"
best
practicable
technology"
or
"
BPT."
Further,
section
301(
b)(
2)(
A)
directs
EPA
to
establish
effluent
limitations
for
certain
classes
of
pollutants
"
which
shall
require
the
application
of
the
best
available
technology
economically
achievable."
This
is
commonly
referred
to
as
"
best
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
18
available
technology"
or
"
BAT."
Section
301
specifies
that
both
BPT
and
BAT
limitations
must
reflect
determinations
made
by
EPA
under
CWA
section
304.
Under
these
provisions,
the
limitations
on
the
discharge
of
pollutants
from
point
sources
are
based
upon
the
capabilities
of
the
equipment
or
"
control
technologies"
available
to
control
those
discharges.

The
phrases
"
best
available
demonstrated
technology"
and
"
best
available
technology"
 
like
"
best
technology
available"
in
CWA
section
316(
b)
 
are
not
defined
in
the
statute.
However,
section
304
of
the
CWA
specifies
factors
to
be
considered
in
establishing
the
best
practicable
control
technology
currently
available
and
best
available
technology.

For
best
practicable
control
technology
currently
available,
the
CWA
directs
EPA
to
consider:

the
total
cost
of
application
of
technology
in
relation
to
the
effluent
reduction
benefits
to
be
achieved
from
such
application,
and
shall
also
take
into
account
the
age
of
the
equipment
and
facilities
involved,
the
process
employed,
the
engineering
aspects
of
the
application
of
various
types
of
control
techniques,
process
changes,
non­
water
quality
environmental
impact
(
including
energy
requirements),
and
such
other
factors
as
[
EPA]
deems
appropriate.

33
U.
S.
C.
1314(
b)(
1)(
B).

For
"
best
available
technology,"
the
CWA
directs
EPA
to
consider:
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
19
the
age
of
equipment
and
facilities
involved,
the
process
employed,
the
engineering
aspects
.
.
.
of
various
types
of
control
techniques,
process
changes,
the
cost
of
achieving
such
effluent
reduction,
non­
water
quality
environmental
impacts
(
including
energy
requirements),
and
such
other
factors
as
[
EPA]
deems
appropriate.

33
U.
S.
C.
1314(
b)(
2)(
B).

Section
316(
b)
expressly
refers
to
section
301,
and
the
phrase
"
best
technology
available"
is
very
similar
to
"
best
available
technology"
in
that
section.
These
facts,

coupled
with
the
brevity
of
section
316(
b)
itself,
prompted
EPA
to
look
to
section
301
and,
ultimately,
section
304
for
guidance
in
determining
the
"
best
technology
available
to
minimize
adverse
environmental
impact"
of
cooling
water
intake
structures
for
Phase
III
existing
facilities.

By
the
same
token,
however,
there
are
significant
differences
between
section
316(
b)
and
sections
301
and
304.
See
Riverkeeper,
Inc.
v.
United
States
Environmental
Protection
Agency,
slip
op.
at
13,
(
2nd
Cir.
Feb.
3,
2004)
("
not
every
statutory
directive
contained
[
in
sections
301
and
306]
is
applicable"
to
a
section
316(
b)
rulemaking).

Section
316(
b)
requires
that
cooling
water
intake
structures
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact.
In
contrast
to
the
effluent
limitations
provisions,
the
object
of
the
"
best
technology
available"
is
explicitly
articulated
by
reference
to
the
receiving
water:
to
minimize
adverse
environmental
impact
in
the
waters
from
which
cooling
water
is
withdrawn.
This
difference
is
reflected
in
EPA's
past
practices
in
implementing
sections
301,
304,
and
316(
b).
While
EPA
has
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
20
established
effluent
limitations
guidelines
based
on
the
efficacy
of
one
or
more
technologies
to
reduce
pollutants
in
wastewater,
considering
costs,
but
without
necessarily
considering
the
impact
on
the
receiving
waters,
EPA
has
previously
considered
the
costs
of
technologies
in
relation
to
the
benefits
of
minimizing
adverse
environmental
impact
in
establishing
section
316(
b)
limits.
In
Re
Public
Service
Co.
of
New
Hampshire,
10
ERC
1257
(
June
17,
1977);
In
Re
Public
Service
Co.
of
New
Hampshire,
1
EAD
455
(
Aug.
4,
1978);
Seacoast
Anti­
Pollution
League
v.
Costle,
597
F.

2d
306
(
1st
Cir.
1979).

For
this
Phase
III
rulemaking,
EPA
therefore
interprets
CWA
section
316(
b)
as
authorizing
EPA
to
consider
not
only
technologies
but
also
their
effects
on
and
benefits
to
the
water
from
which
the
cooling
water
is
withdrawn.
Accordingly,
national
categorical
requirements
for
cooling
water
intake
structures
may
be
based
on
a
determination
that
the
technology
bases
for
these
are
technically
available,
economically
practicable,
and
justified
by
the
benefits
to
the
source
waterbody.
Taking
into
account
these
same
factors,

as
well
as
the
unacceptable
cost
to
benefit
ratio,
and
the
particular
concern
in
ensuring
benefits
justify
costs
when
manufacturing
facilities
are
involved,
EPA
has
decided
not
to
promulgate
national
categorical
requirements
for
existing
Phase
III
facilities,
but
rather
to
allow
the
establishment
of
best
technology
available
for
minimizing
adverse
environmental
impact
for
existing
facilities
not
covered
by
the
Phase
II
rule
based
on
the
permitting
authority's
case­
by­
case,
best
professional
judgment.

EPA's
authority
to
direct
permit
writers
to
use
their
case­
by­
case,
best
professional
judgment
(
BPJ)
for
determining
the
best
technology
available
for
minimizing
adverse
environmental
impact
(
BTA)
for
Phase
III
existing
facilities
derives
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
21
from
section
316(
b).
Section
316(
b)
of
the
CWA
grants
EPA
broad
authority
to
establish
performance
standards
for
cooling
water
intake
structures
based
on
the
"
best
technology
available
to
minimize
adverse
environmental
impact."
Although
EPA
has
chosen
under
316(
b)
to
promulgate
national
categorical
performance
standards
applicable
to
certain
classes
of
point
sources
using
cooling
water
intake
structures,
see
40
CFR
Subpart
J
(
existing
power
generating
facilities),
and
Subpart
N
(
new
offshore
oil
and
gas
facilities),

the
statute
does
not
preclude
EPA
from
determining
BTA
on
a
site­
specific
basis.

Indeed,
the
U.
S.
Court
of
Appeals
for
the
Second
Circuit,
in
upholding
virtually
the
entire
new
316(
b)
Phase
I
rule,
specifically
noted
that
section
316(
b)
does
not
compel
EPA
to
regulate
cooling
water
intake
structures
based
on
either
one
overarching
regulation,

categories
of
sources,
or
on
a
case­
by­
case
basis.
Riverkeeper,
358
F.
3d
at
203.
In
fact,

EPA
and
state
permitting
authorities
have
been
implementing
Section
316(
b)
on
a
caseby
case
basis
for
over
25
years
(
see
Section
III.
C.
3
below),
and
courts
have
recognized
this
practice
as
consistent
with
the
statute.
See
Hudson
Riverkeeper
Fund
v.
Orange
&

Rockland
Utils.,
Inc.,
835
F.
Supp.
160,
165
(
S.
D.
N.
Y.
1993)
("
This
leaves
to
the
Permit
Writer
an
opportunity
to
impose
conditions
on
a
case
by
case
basis,
consistent
with
the
statute
.
.
.
.").

Consistent
with
this,
in
both
the
Phase
I
and
II
rules,
EPA
uses
a
case­
by­
case,

BPJ
permitting
regime
for
facilities
that
do
not
meet
the
applicability
criteria
for
EPA's
national
categorical
rules.
See
40
CFR
125.81(
a),
125.90(
b).
In
Riverkeeper,
this
provision
of
the
Phase
I
rule
was
upheld
by
the
Second
Circuit.
358
F.
3d
at
203
("[
w]
e
see
no
textual
bar
in
sections
306
or
316(
b)
to
regulating
below­
threshold
structures
on
a
case­
by­
case
basis.").
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
22
EPA
bases
its
decision
to
rely
on
BPJ
permitting
for
the
Phase
III
facilities
on
its
consideration
of
the
direct
costs
of
the
proposed
national
categorical
regulation
in
comparison
to
the
benefits
the
rule
would
produce.
EPA's
authority
to
consider
costs
as
well
as
benefits
in
making
that
decision
derives
from
section
316(
b).

Section
316(
b)
of
the
CWA
states
that
cooling
water
intake
structures
must
"
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact."
In
this
action,
EPA
has
chosen
to
evaluate
environmental
impacts
in
terms
of
benefits.

Because
section
316(
b)
is
silent
as
to
the
factors
EPA
should
consider
in
determining
the
best
technology
available
to
minimize
adverse
environmental
impact
EPA
has
broad
discretion
to
identify
the
appropriate
criteria.
See
Riverkeeper,
358
F.
3d
at
187,
n.
12
(
brevity
of
section
316(
b)
reflects
an
intention
to
delegate
significant
rulemaking
authority
to
EPA);
see
id.
at
195
(
appellate
courts
give
EPA
"
considerable
discretion
to
weigh
and
balance
the
various
factors"
where
the
statute
does
not
state
what
weight
should
be
accorded)
(
citation
omitted).

Section
316(
b)
authorizes
EPA
to
consider
the
benefits
that
a
technology­
based
standard
would
produce
in
order
to
ensure
that
the
standard
will
"
minimize
adverse
environmental
impact."
Section
316(
b)
does
not
define
minimized
adverse
environmental
impact,
but
rather
it
leaves
its
interpretation
to
EPA's
judgment.
In
the
context
of
the
Phase
III
action,
EPA
has
concluded
that
the
relationship
between
costs
and
benefits
is
an
important
component
of
deciding
whether
to
proceed
with
a
rule
or
whether
the
choice
of
BTA
should
be
left
to
case­
by­
case
decisionmaking.
In
EPA's
view,
when
the
costs
of
establishing
a
national
categorical
rule
substantially
outweigh
the
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
23
benefits
of
such
a
rule,
a
national
categorical
section
316(
b)
rule
is
not
the
best
tool
for
implementing
section
316(
b)'
s
direction.

2.
Consent
Decree
This
final
action
fulfills
EPA's
obligation
to
comply
with
the
Second
Amended
Consent
Decree,
which
was
filed
on
November
25,
2002,
in
the
United
States
District
Court,
Southern
District
of
New
York,
in
Riverkeeper,
Inc.
v.
Johnson,
No.
93
Civ
0314
(
AGS).
That
case
was
brought
against
EPA
by
a
coalition
of
individuals
and
environmental
groups.
The
original
Consent
Decree,
filed
on
October
10,
1995,
provided
that
EPA
was
to
propose
regulations
implementing
section
316(
b)
by
July
2,
1999,
and
take
final
action
with
respect
to
those
regulations
by
August
13,
2001.
Under
subsequent
interim
orders,
the
Amended
Consent
Decree
filed
on
November
22,
2000,
and
the
Second
Amended
Consent
Decree,
EPA
divided
the
rulemaking
into
three
phases.
EPA
took
final
action
promulgating
a
rule
governing
cooling
water
intake
structures
used
by
new
facilities
(
Phase
I)
on
November
9,
2001
(
66
FR
65255,
December
18,
2001).
EPA
took
final
action
promulgating
a
rule
governing
cooling
water
intake
structures
used
by
large
existing
power
producers
(
Phase
II)
on
February
16,
2004
(
69
FR
41576,
July
9,

2004).
The
consent
decree
further
requires
that
EPA
propose
by
November
1,
2004,
and
take
final
action
by
June
1,
2006,
regulations
applicable
to
the
following
categories:

utility
and
non­
utility
power
producers
not
covered
by
the
Phase
II
regulations,
pulp
and
paper
manufacturing,
petroleum
and
coal
products
manufacturing,
chemical
and
allied
products
manufacturing,
and
primary
metals
manufacturing
(
Phase
III).
EPA
proposed
Phase
III
regulations
on
November
1,
2004
(
69
FR
68444)
and
this
final
action
fulfills
EPA's
obligations
for
Phase
III.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
24
3.
What
Other
EPA
Rulemakings
and
Guidance
Address
Cooling
Water
Intake
Structures?

In
April
1976,
EPA
published
a
final
rule
under
section
316(
b)
that
addressed
cooling
water
intake
structures.
41
FR
17387
(
April
26,
1976),
see
also
the
proposed
rule
at
38
FR
34410
(
December
13,
1973).
The
rule
added
a
new
§
401.14
to
40
CFR
Chapter
I
that
reiterated
the
requirements
of
CWA
section
316(
b).
It
also
added
a
new
part
402,

which
included
three
sections:
1)
§
402.10
(
Applicability),
2)
§
402.11
(
Specialized
definitions),
and
3)
§
402.12
(
Best
technology
available
for
cooling
water
intake
structures).
Section
402.10
stated
that
the
provisions
of
part
402
applied
to
"
cooling
water
intake
structures
for
point
sources
for
which
effluent
limitations
are
established
pursuant
to
section
301
or
standards
of
performance
are
established
pursuant
to
section
306
of
the
Act."
Section
402.11
defined
the
terms
"
cooling
water
intake
structure,"

"
location,"
"
design,"
"
construction,"
"
capacity,"
and
"
Development
Document."
Section
402.12
included
the
following
language:

The
information
contained
in
the
Development
Document
shall
be
considered
in
determining
whether
the
location,
design,
construction,
and
capacity
of
a
cooling
water
intake
structure
of
a
point
source
subject
to
standards
established
under
section
301
or
306
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact.

In
1977,
fifty­
eight
electric
utility
companies
challenged
those
regulations,

arguing
that
EPA
had
failed
to
comply
with
the
requirements
of
the
Administrative
Procedure
Act
(
APA)
in
promulgating
the
rule.
Specifically,
the
utilities
argued
that
EPA
had
neither
published
the
Development
Document
in
the
Federal
Register
nor
properly
Interagency
Review
Draft­­
05/
05/
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Deliberative:
do
not
cite,
quote
or
distribute
25
incorporated
the
document
into
the
rule
by
reference.
The
United
States
Court
of
Appeals
for
the
Fourth
Circuit
agreed
and,
without
reaching
the
merits
of
the
regulations
themselves,
remanded
the
rule.
Appalachian
Power
Co.
v.
Train,
566
F.
2d
451
(
4th
Cir.

1977).
EPA
later
withdrew
part
402.
44
FR
32956
(
June
7,
1979).
The
regulation
at
40
CFR
401.14,
which
reiterates
the
statutory
requirement,
remains
in
effect.

Since
the
Fourth
Circuit
remanded
EPA's
section
316(
b)
regulations
in
1977,

NPDES
permit
authorities
have
made
decisions
implementing
section
316(
b)
on
a
caseby
case,
site­
specific
basis.
EPA
published
draft
guidance
addressing
section
316(
b)

implementation
in
1977.
See
Draft
Guidance
for
Evaluating
the
Adverse
Impact
of
Cooling
Water
Intake
Structures
on
the
Aquatic
Environment:
Section
316(
b)
P.
L.
92­

500
(
U.
S.
EPA,
1977).
This
draft
guidance
described
the
studies
recommended
for
evaluating
the
impact
of
cooling
water
intake
structures
on
the
aquatic
environment
and
recommended
a
basis
for
determining
the
best
technology
available
for
minimizing
adverse
environmental
impact.
The
1977
section
316(
b)
draft
guidance
states,
"
The
environmental­
intake
interactions
in
question
are
highly
site­
specific
and
the
decision
as
to
best
technology
available
for
intake
design,
location,
construction,
and
capacity
must
be
made
on
a
case­
by­
case
basis."
(
Section
316(
b)
Draft
Guidance,
U.
S.
EPA,
1977,
p.

4).
This
case­
by­
case
approach
was
also
consistent
with
the
approach
described
in
the
1976
Development
Document
referenced
in
the
remanded
regulation.

The
1977
section
316(
b)
draft
guidance
suggested
a
general
process
for
developing
information
needed
to
support
section
316(
b)
decisions
and
presenting
that
information
to
the
permitting
authority.
The
process
involved
the
development
of
a
sitespecific
study
of
the
environmental
effects
associated
with
each
facility
that
uses
one
or
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
26
more
cooling
water
intake
structures,
as
well
as
consideration
of
that
study
by
the
permitting
authority
in
determining
whether
the
facility
must
make
any
changes
for
minimizing
adverse
environmental
impact.
Where
adverse
environmental
impact
is
present,
the
1977
draft
guidance
suggested
a
stepwise
approach
that
considers
screening
systems,
size,
location,
capacity,
and
other
factors.

Although
the
draft
guidance
described
the
information
that
should
be
developed,

key
factors
that
should
be
considered,
and
a
process
for
supporting
section
316(
b)

determinations,
it
did
not
establish
uniform
technology­
based
national
standards
for
best
technology
available
for
minimizing
adverse
environmental
impact.
Rather,
the
draft
guidance
left
the
decisions
on
the
appropriate
location,
design,
capacity,
and
construction
of
cooling
water
intake
structures
to
the
permitting
authority.
Under
this
framework,
the
Director
determined
whether
appropriate
studies
have
been
performed,
whether
a
given
facility
has
minimized
adverse
environmental
impact,
and
what,
if
any,
technologies
may
be
required.

4.
Phase
I
New
Facility
Rule
On
November
9,
2001,
EPA
took
final
action
on
Phase
II
regulations
governing
cooling
water
intake
structures
at
new
facilities.
66
FR
65255
(
December
18,
2001).
On
December
26,
2002,
EPA
made
minor
changes
to
the
Phase
I
regulations.
67
FR
78947.

The
final
Phase
I
new
facility
rule
(
40
CFR
Part
125,
Subpart
I)
establishes
requirements
applicable
to
the
location,
design,
construction,
and
capacity
of
cooling
water
intake
structures
at
new
facilities
that
withdraw
greater
than
two
(
2)
MGD
and
use
at
least
twenty­
five
(
25)
percent
of
the
water
they
withdraw
solely
for
cooling
purposes.
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
27
With
the
new
facility
rule,
EPA
promulgated
national
minimum
requirements
for
the
location,
design,
capacity,
and
construction
of
cooling
water
intake
structures
at
new
facilities.
The
final
new
facility
rule
establishes
a
reasonable
framework
that
creates
certainty
for
permitting
of
new
facilities,
while
providing
significant
flexibility
to
take
site­
specific
factors
into
account.

EPA
specifically
excluded
new
offshore
oil
and
gas
extraction
facilities
from
the
Phase
I
new
facility
rule,
but
committed
to
consider
establishing
requirements
for
such
facilities
in
the
Phase
III
rulemaking.
66
FR
65338
(
December
18,
2001).

5.
Phase
II
Existing
Facility
Rule
On
February
16,
2004,
EPA
took
final
action
on
regulations
governing
cooling
water
intake
structures
at
certain
existing
power
producing
facilities.
69
FR
41576
(
July
9,
2004).
The
final
Phase
II
rule
applies
to
existing
facilities
that
are
point
sources;
that,

as
their
primary
activity,
both
generate
and
transmit
electric
power
or
generate
electric
power
for
sale
to
another
entity
for
transmission;
that
use
or
propose
to
use
cooling
water
intake
structures
with
a
total
design
intake
flow
of
50
MGD
or
more
to
withdraw
cooling
water
from
waters
of
the
United
States;
and
that
use
at
least
25
percent
of
the
withdrawn
water
exclusively
for
cooling
purposes.

Under
the
Phase
II
rule,
EPA
established
performance
standards
for
the
reduction
of
impingement
mortality
and
entrainment
(
see
40
CFR
125.94).
The
performance
standards
consist
of
ranges
of
reductions
in
impingement
mortality
and/
or
entrainment
(
e.
g.,
reduce
impingement
mortality
by
80
to
95
percent
and
under
certain
conditions
entrainment
by
60
to
90
percent).
These
performance
standards
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impacts
at
facilities
covered
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
28
by
the
Phase
II
rule.
The
type
of
performance
standard
applicable
to
a
particular
facility
(
i.
e.,
reductions
in
impingement
mortality
only
or
impingement
mortality
and
entrainment)
is
based
on
several
factors,
including
the
facility's
location
(
i.
e.,
source
waterbody),
rate
of
use
(
capacity
utilization
rate),
and
the
proportion
of
the
waterbody
withdrawn.
The
Phase
II
regulations
address
more
than
90
percent
of
total
cooling
water
intake
flows
in
the
United
States.

6.
Public
Participation
EPA
worked
extensively
with
stakeholders
from
the
industry,
public
interest
groups,
State
agencies,
and
other
Federal
agencies
in
the
development
of
this
rule.
EPA
included
industry
groups,
environmental
groups,
and
other
government
entities
in
the
development,
testing,
refinement,
and
completion
of
the
section
316(
b)
survey,
which
was
used
as
a
primary
source
of
data
for
Phase
III.
As
discussed
in
section
III
of
this
preamble,
the
survey,
"
Information
Collection
Request,
Detailed
Industry
Questionnaires:

Phase
II
Cooling
Water
Intake
Structures
&
Watershed
Case
Study
Short
Questionnaire,"

was
initiated
in
1997,
and
was
used
to
collect
data
during
2000.

EPA
sponsored
a
Symposium
on
Cooling
Water
Intake
Technologies
to
Protect
Aquatic
Organisms,
on
May
6 
7,
2003.
This
symposium
brought
together
professionals
from
Federal,
State,
and
Tribal
regulatory
agencies;
industry;
environmental
organizations;
engineering
consulting
firms;
science
and
research
organizations;

academia;
and
others
concerned
with
mitigating
harm
to
the
aquatic
environment
by
cooling
water
intake
structures.
Efficacy
and
costs
of
various
technologies
to
mitigate
impacts
to
aquatic
organisms
from
cooling
water
intake
structures,
as
well
as
research
and
other
future
needs,
were
discussed.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
29
During
the
development
of
this
regulation,
EPA
met
several
times
with
trade
associations
whose
members
would
be
subject
to
Phase
III
requirements.
EPA
also
conducted
Phase
III­
specific
data
collection
activities,
including
a
study
of
entrainment
at
Phase
III
facilities,
contacting
Phase
III
facilities
to
request
biological
studies
and
conducting
an
industry
survey
of
offshore
oil
and
gas
extraction
facilities
and
seafood
processing
vessels.

In
developing
requirements
for
new
offshore
oil
and
gas
extraction
facilities,
EPA
drew
on
its
experience
from
the
offshore
oil
and
gas,
the
coastal
oil
and
gas,
and
the
synthetic
drilling
fluids
effluent
limitations
guidelines,
which
included
extensive
public
outreach,
meetings,
public
comment
periods,
industry
surveys,
and
economic
analysis
and
modeling
of
representative
oil
and
gas
operations
as
detailed
in
61
FR
66086­
66130
and
66
FR
6849­
6919.

Finally,
EPA
convened
a
Small
Business
Advocacy
Review
(
SBAR)
panel
(
in
accordance
with
the
Regulatory
Flexibility
Act
section
609(
b)
as
amended
by
the
Small
Business
Regulatory
and
Enforcement
Fairness
Act)
to
provide
information
to
small
entities
and
receive
feedback
during
the
Phase
III
rulemaking
process.
EPA
hosted
a
prepanel
outreach
meeting
for
small
entities
potentially
subject
to
Phase
III
on
January
22,

2004.
The
SBAR
panel
held
an
outreach
meeting
with
small
entity
representatives
(
SERs)
on
March
16,
2004.
Based
on
the
information
gathered
from
the
participating
small
entities
during
these
outreach
meetings
and
subsequent
correspondence,
the
SBAR
panel
produced
a
final
report
to
the
EPA
Administrator
on
April
27,
2004.
Results
of
the
final
report
were
considered
in
the
development
of
the
Phase
III
rule.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
30
These
coordination
efforts
and
all
of
the
meetings
described
in
this
section,
as
well
as
the
comments
submitted
on
the
Phase
I
and
II
section
316(
b)
rules
and
EPA's
response
to
these
comments,
are
documented
or
summarized
in
the
dockets
for
these
three
rules.
The
Administrative
Record
for
this
rule
includes
all
materials
from
the
Phase
I,
Phase
II,
and
Phase
III
section
316(
b)
rule
dockets.
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
31
IV.
Environmental
Impacts
Associated
With
Cooling
Water
Intake
Structures
EPA
has
determined
that
there
are
multiple
types
of
environmental
impacts
that
can
be
associated
with
Phase
III
facilities,
depending
on
conditions
at
an
individual
facility's
site.
These
impacts
include
organism
entrainment
and
impingement,
which
can
contribute
to
impacts
to
threatened
and
endangered
species;
reductions
in
ecologically
critical
aquatic
organisms,
including
important
elements
of
an
ecosystem's
food
chain;

diminishment
of
organism
populations'
compensatory
reserves;
losses
to
populations,

including
reductions
of
indigenous
species
population
levels,
commercial
fisheries,
and
recreational
fisheries;
and
stresses
to
overall
communities
and
ecosystems
as
evidenced
by
reductions
in
diversity,
changes
in
species
composition,
or
other
changes
in
ecosystem
structure
or
function.
(
See
discussion
at
69
FR
68461­
66.)

The
withdrawal
of
water
affects
a
variety
of
aquatic
organisms
including
phytoplankton
(
tiny,
free­
floating
photosynthetic
organisms
suspended
in
the
water
column),
zooplankton
(
small
aquatic
animals,
including
fish
eggs
and
larvae,
which
may
consume
phytoplankton
and
other
zooplankton),
macroinvertebrates,
shellfish,
and
fish.

Other
organisms,
including
reptiles,
birds,
and
mammals
can
also
be
impinged
or
entrained.

Impingement
takes
place
when
organisms
are
trapped
against
a
cooling
water
intake
structure,
particularly
screening
materials,
by
the
force
of
water
being
drawn
through
the
intake
structure.
The
velocity
of
the
water
intake
by
the
structure
can
remove
fish
scales
or
other
organism
structures,
prevent
proper
gill
function,
or
otherwise
physically
harm
or
cause
the
death
of
impinged
organisms
through
exhaustion,
starvation,

asphyxiation,
and
descaling
or
other
injury.
Death
from
impingement
("
impingement
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
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cite,
quote
or
distribute
32
mortality'')
can
take
place
while
organisms
are
impinged
on
an
intake
structure
or
it
can
take
place
after
organisms
have
escaped
impingement
and
have
returned
to
a
waterbody.

An
organism
can
die
despite
escaping
impingement
because
of
injuries
it
receives
during
the
impingement
process.

Entrainment
occurs
when
organisms
are
drawn
through
a
cooling
water
intake
structure
into
a
facility's
cooling
system.
Organisms
that
become
entrained
are
typically
relatively
small
aquatic
organisms,
including
many
early
life
stages
of
fish
and
shellfish.

As
entrained
organisms
pass
through
a
facility's
cooling
system
they
can
be
subject
to
mechanical,
thermal,
and/
or,
chemical
stress.
Sources
of
stress
include
physical
impacts
in
the
pumps
and
condenser
tubing,
pressure
changes
caused
by
diversion
of
the
cooling
water
into
the
plant
or
by
the
hydraulic
effects
of
the
condensers,
shear
stress,
thermal
shock
in
the
condenser
and
discharge
tunnel,
and
chemical
toxic
effects
from
cooling
system
antifouling
agents
such
as
chlorine.
Similar
to
impingement
mortality,
death
from
entrainment
can
occur
during
entrainment
or
at
some
time
after
the
entrainment
and
return
of
entrained
organisms
to
a
waterbody.

Environmental
Impacts
from
New
Offshore
Oil
and
Gas
Extraction
Facility
Cooling
Water
Intake
Structures
Offshore
oil
and
gas
extraction
facilities
currently
operate
off
the
coasts
of
California
and
Alaska
and
throughout
the
Gulf
of
Mexico.
Most
activity
currently
takes
place
in
the
Gulf
of
Mexico.
EPA
expects
that
most
new
facility
activity
will
also
take
place
in
this
region.
(
See
Phase
III
TDD;
DCN
[
9­
XXXX],
document
ID
OW­
2004­

0002­[
XXXX],
pp.
3­[
XXX]
to
3­[
XXX]).
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
33
While
EPA
is
not
aware
of
any
studies
that
directly
examine
or
document
impingement
mortality
and
entrainment
by
offshore
oil
and
gas
extraction
facilities,

numerous
studies
show
that
offshore
marine
environments
provide
habitat
for
a
number
of
species
of
fish,
shellfish,
and
other
aquatic
organisms.
Many
of
these
species
have
life
stages
that
are
small
and
planktonic
or
have
limited
swimming
ability.
These
life
stages
are
potentially
vulnerable
to
entrainment
by
cooling
water
intake
structures.
Larger
life
stages
are
potentially
vulnerable
to
impingement.
The
introduction
of
cooling
water
intake
structures
into
the
offshore
habitat
in
which
these
organisms
live
creates
the
potential
for
impingement
and
entrainment
of
these
organisms.

The
densities
of
organisms
in
the
immediate
vicinity
of
offshore
oil
and
gas
extraction
facilities
relative
to
densities
in
estuaries
and
other
nearshore
coastal
waters
is
not
well
characterized.
In
the
Phase
III
NODA
(
70
FR
71059),
EPA
presented
analysis
of
additional
data
from
the
general
regions
in
which
existing
offshore
oil
and
gas
extraction
facilities
operate
and
where
new
facilities
might
operate
in
the
future
in
order
to
better
characterize
the
potential
for
impingement
and
entrainment
by
these
facilities.

EPA
obtained
data
on
densities
of
ichthyoplankton
(
planktonic
fish
eggs
and
larvae)
in
the
Gulf
of
Mexico
from
the
Southeast
Area
Monitoring
and
Assessment
Program
(
SEAMAP).
2,3
This
long­
term
sampling
program
collects
information
on
the
density
of
fish
eggs
and
larvae
throughout
the
Gulf
of
Mexico.
EPA
analyzed
the
SEAMAP
data
to
determine
average
ichthyoplankton
densities
in
the
Gulf
of
Mexico
for
2
Adam
Rettig
and
Blaine
Snyder,
Tetra
Tech,
Inc.
Memorandum
to
Ashley
Allen,
EPA.
A
summary
of
ichthyoplankton
presence
and
abundance
in
the
Gulf
of
Mexico,
as
part
of
an
assessment
of
the
potential
for
entrainment
by
offshore
oil
and
gas
facilities.
2005.
DCN
8­
5220.
Document
ID
OW­
2004­
0002­
951.
3
Adam
Rettig
and
Blaine
Snyder,
Tetra
Tech,
Inc.
Memorandum
to
Ashley
Allen,
EPA.
A
Summary
of
Fish
Egg
Presence
and
Abundance
in
the
Gulf
of
Mexico,
as
Part
of
an
Assessment
of
the
Potential
for
Entrainment
by
Offshore
Oil
and
Gas
Facilities.
DCN
9­
5200.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
34
the
period
of
time
for
which
sampling
data
was
available
(
1982­
2003).
Actual
conditions
at
any
one
location
and
at
any
one
point
in
time
vary
from
the
calculated
averages.

EPA's
analysis
of
the
SEAMAP
data
indicates
that
ichthyoplankton
occur
throughout
the
Gulf
of
Mexico.
On
average,
densities
are
highest
at
sampling
stations
in
the
shallower
regions
of
the
Gulf
of
Mexico
and
lowest
at
sampling
stations
in
the
deepest
regions.
The
overall
range
of
average
larval
fish
densities
was
calculated
to
be
25­
450+
organisms/
100m3.4
The
wide
range
of
ichthyoplankton
densities
seen
in
the
offshore
Gulf
of
Mexico
region
falls
within
the
range
of
larval
fish
densities
documented
in
freshwater
and
coastal
water
bodies
in
various
coastal
and
inland
regions
of
the
United
States.
5
Over
600
different
fish
taxa
were
identified
in
the
SEAMAP
samples,
including
species
of
commercial
and
recreational
utility.

In
the
area
surrounding
existing
offshore
oil
and
gas
extraction
facilities
off
the
California
coast,
the
California
Cooperative
Oceanic
Fisheries
Investigations
(
CalCOFI)

program
has
gathered
data
on
densities
of
ichthyoplankton
and
other
organisms.

According
to
the
CalCOFI
and
other
research
programs,
a
number
of
fish
and
shellfish
species,
including
species
of
commercial
and
recreational
value,
are
known
to
live
and
spawn
in
this
region.
EPA
does
not
know
of
similarly
extensive
sampling
programs
for
the
Alaska
offshore
region.
However,
a
number
of
fish
and
shellfish
species,
including
species
of
commercial
and
recreational
value,
are
known
from
various
research
programs
to
live
and
spawn
in
the
offshore
regions
of
Alaska
where
oil
and
gas
extraction
activities
4
Average
larval
fish
densities
are
greater
than
450
organisms/
100
m3
at
sampling
stations
in
waters
less
than
50
meters
deep.
Average
larval
fish
densities
gradually
decrease
to
100
organisms/
100
m3
as
sampling
station
depth­
at­
location
increases
to
150
meters.
At
stations
in
waters
greater
than
150
meters
deep,
larval
fish
densities
are
relatively
uniform
and
fall
between
25
organisms/
100
m3
and
100
organisms/
100
m3.
See
Document
ID
OW­
2004­
0002­
951.
5
A.
L.
Allen
(
EPA).
Memorandum
to
EPA
Docket
OW­
2004­
0002.
Summary
of
Information
on
Ichthyoplankton
Densities
in
Various
Aquatic
Ecosystems
in
the
United
States.
DCN
8­
5240.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
35
currently
take
place
or
may
take
place
in
the
future.
6
The
eggs
and
larvae
of
many
species
found
in
the
offshore
regions
of
California
and
Alaska
are
planktonic
and
could
therefore
be
vulnerable
to
entrainment
by
a
facility's
cooling
water
intake
structure
operating
in
these
regions.
Larger
life
stages
(
e.
g.,
juveniles
and
adults)
could
be
vulnerable
to
impingement.

The
densities
of
organisms
in
the
immediate
vicinity
of
offshore
oil
and
gas
extraction
facilities
may
differ
from
those
suggested
by
analysis
of
SEAMAP
and
other
collections
of
data
that
characterize
typical
organism
densities
in
marine
waters.

Offshore
oil
and
gas
extraction
facilities
have
been
shown
to
attract
and
concentrate
aquatic
organisms
in
the
immediate
vicinity
of
the
underwater
portions
of
their
structures.

A
variety
of
species
of
pelagic
fish
have
been
found
to
gather
around
the
underwater
portions
of
offshore
oil
and
gas
extraction
facilities
within
short
time
periods
after
the
facilities'
appearance
in
the
water
column.
If
a
facility
remains
in
one
place
for
a
sufficient
length
of
time,
some
aquatic
organism
species
take
up
residence
directly
upon
the
underwater
structure
and
form
reef­
like
communities.
The
increased
number
of
organisms
living
near
the
underwater
portion
of
facilities
where
cooling
water
intake
structures
are
located
increases
the
potential
for
impingement
mortality
and
entrainment
of
those
organisms.
The
extent
to
which
the
increased
numbers
of
aquatic
organisms
represents
an
overall
increase
in
organism
populations,
rather
than
a
concentration
of
organisms
from
surrounding
areas,
is
not
known.
(
For
additional
information,
see
DCN
7­
0013.)

6
A.
L.
Allen
(
EPA).
Memorandum
to
EPA
Docket
OW­
2004­
0002.
Summary
of
Information
on
Fish
Species
that
Live
and
Spawn
off
the
Coasts
of
Alaska
and
California
in
the
Vicinity
of
Offshore
Oil
and
Gas
Production
Areas.
DCN
8­
5260.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
36
EPA
believes
the
data
it
has
gathered
on
organisms
that
inhabit
offshore
environments
indicate
the
potential
for
their
entrainment
and
impingement
by
cooling
water
intake
structures
associated
with
new
offshore
oil
and
gas
extraction
facilities.

Given
this
potential
for
impingement
and
entrainment,
EPA
believes
that
these
new
facilities
have
the
potential
to
create
multiple
types
of
undesirable
and
unacceptable
impacts.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
37
V.
Description
of
the
Rule
Section
316(
b)
of
the
CWA
requires
EPA
to
ensure
that
the
location,
design,

construction,
and
capacity
of
cooling
water
intake
structures
reflect
the
best
technology
available
to
minimize
adverse
environmental
impact.
Such
impacts
include
death
or
injury
to
aquatic
organisms
by
impingement
(
being
pinned
against
screens
or
other
parts
of
a
cooling
water
intake
structure)
or
entrainment
(
being
drawn
into
cooling
water
systems
and
subjected
to
thermal,
physical
or
chemical
stresses).

This
Phase
III
rulemaking
addresses
new
offshore
and
coastal
oil
and
gas
extraction
facilities
that
are
designed
to
withdraw
at
least
2
MGD.
New
offshore
oil
and
gas
extraction
facilities
were
specifically
excluded
from
the
scope
of
the
Phase
I
new
facility
rule
so
that
EPA
could
gather
additional
data
on
these
facilities
(
see
66
FR
65311).
This
regulation
reflects
a
decision
not
to
promulgate
a
national
rule
for
existing
Phase
III
facilities.
See
section
II
of
this
preamble
for
more
information.

A.
Summary
of
Proposed
Rule
The
proposed
rule
would
establish
national
requirements
for
new
offshore
and
coastal
oil
and
gas
extraction
facilities.
EPA
has
established
a
two­
track
approach
to
offer
maximum
flexibility.
Track
I
establishes
uniform
requirements
based
on
facility
cooling
water
intake
capacity.
Track
II
provides
dischargers
with
the
opportunity
to
establish
that
alternative
requirements
will
achieve
comparable
performance.
Under
Track
I,
these
facilities
would
be
required
to
design
their
cooling
water
intake
structures
to
meet
a
through­
screen
velocity
of
0.5
feet
per
second
(
ft/
s)
or
less
and,
if
they
are
located
in
estuaries
or
tidal
rivers,
they
would
also
be
required
to
meet
proportional
flow
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
38
requirements.
Facilities
would
need
to
implement
technologies
and/
or
operational
measures
for
minimizing
impingement
if
there
are
specific
impact
concerns
(
e.
g.,

threatened
or
endangered
species,
critical
habitat,
migratory,
sport,
or
commercial
species).
Facilities
that
do
not
employ
sea
chests
(
openings
in
the
hull
of
a
vessel
for
withdrawing
cooling
water)
and
are
fixed
facilities
would
be
required
to
use
fish
protection
technologies
and/
or
operational
measures
to
minimize
entrainment.

As
with
other
new
facilities
covered
by
the
Phase
I
rule,
fixed
facilities
could
comply
under
Track
II
which
allows
the
facility
to
demonstrate
that
alternative
technologies
(
in
this
case,
alternatives
to
meeting
the
0.5
ft/
s
velocity
standard,
or
for
fixed
facilities
without
sea
chests,
the
requirement
to
minimize
entrainment)
provide
comparable
protection.
EPA
did
not
propose
to
extend
this
provision
to
mobile
facilities,

as
EPA
did
not
believe
that
there
were
alternatives
to
the
low­
velocity
standard
for
mobile
facilities.

EPA
also
proposed
national
categorical
requirements
for
Phase
III
existing
facilities
that
use
or
propose
to
use
a
cooling
water
intake
structure
to
withdraw
water
for
cooling
purposes
from
waters
of
the
United
States
and
that
have
or
are
required
to
have
a
National
Pollutant
Discharge
Elimination
System
(
NPDES)
permit
issued
under
section
402
of
the
CWA.
As
proposed,
Phase
III
existing
facilities
would
have
included
manufacturing
facilities
on
all
waterbody
types
who
have
a
design
intake
flow
of
50
MGD
or
greater,
and
that
use
at
least
25
percent
of
the
water
it
withdraws
exclusively
for
cooling
purposes.
EPA
co­
proposed
design
intake
flow
thresholds
of
200
MGD
on
all
waterbody
types,
as
well
as
100
MGD
for
facilities
located
on
sensitive
waterbodies
(
i.
e.,

estuaries,
tidal
rivers,
coastal
waters,
or
the
Great
Lakes).
Facilities
with
intakes
below
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
39
these
thresholds
would
have
continued
to
be
subject
to
316(
b)
requirements
set
by
the
Director
on
a
case­
by­
case
basis.

For
existing
Phase
III
facilities
meeting
the
selected
threshold,
the
proposed
rule
would
have
established
national
performance
standards
for
the
reduction
of
impingement
mortality
and,
when
appropriate,
entrainment
at
land­
based
Phase
III
existing
facilities
(
i.
e.,
non­
offshore
facilities).
The
type
of
performance
standard
applicable
to
a
particular
facility
(
i.
e.,
reductions
in
impingement
only
or
impingement
and
entrainment)
was
based
on
several
factors,
including
the
facility's
location
(
i.
e.,
source
waterbody)
and
the
proportion
of
the
waterbody
withdrawn.
Under
the
proposed
rule,
the
performance
standards
could
be
met,
in
whole
or
in
part,
by
using
design
and
construction
technologies,
operational
measures,
or
restoration
measures.

B.
Final
Rule
for
New
Offshore
Oil
and
Gas
Extraction
Facilities
This
rule
establishes
categorical
section
316(
b)
requirements
for
new
offshore
oil
and
gas
extraction
facilities
that
have
a
design
intake
flow
of
2
MGD
or
greater
and
that
withdraw
at
least
25
percent
of
the
water
exclusively
for
cooling
purposes
and
meet
other
applicability
criteria
(
see
§
125.131).
Under
this
final
rule,
EPA
has
established
requirements
for
the
reduction
of
impingement
mortality
(
see
§
125.134)
at
new
offshore
oil
and
gas
extraction
facilities.
In
this
final
rule,
fixed
facilities7
with
sea
chests
and
all
non­
fixed
(
or
"
mobile")
facilities
are
not
required
to
comply
with
standards
for
7
A
fixed
facility
is
defined
as
a
bottom
founded
offshore
oil
and
gas
extraction
facility
permanently
attached
to
the
seabed
or
subsoil
of
the
outer
continental
shelf
(
e.
g.,
platforms,
guyed
towers,
articulated
gravity
platforms)
or
a
buoyant
facility
securely
and
substantially
moored
so
that
it
cannot
be
moved
without
a
special
effort
(
e.
g.,
tension
leg
platforms,
permanently
moored
semi­
submersibles)
and
which
is
not
intended
to
be
moved
during
the
production
life
of
the
well.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
40
entrainment.
Fixed
facilities
may
choose
either
Track
I
or
Track
II
to
comply
with
impingement
mortality
performance
standards.
Non­
fixed
facilities
must
comply
with
the
0.5
feet
per
second
through­
screen
design
intake
flow
velocity
performance
standard
for
impingement
mortality
of
Track
I.
In
addition,
the
Director
may
determine
additional
design
and
construction
technologies
to
minimize
impingement
mortality
are
necessary
where
there
are
protected
species
or
critical
habitat
for
those
species,
or
species
of
concern
within
the
hydrologic
zone
of
influence
of
the
cooling
water
intake
structure,
or
based
on
other
information
from
fishery
management
services
or
agencies,
that
the
proposed
facility,
after
meeting
the
technology­
based
performance
requirements,
would
still
contribute
unacceptable
stress
to
protected
species
or
critical
habitat
of
those
species,

or
species
of
concern.

As
described
in
'
125.135,
facilities
have
the
opportunity
to
conduct
a
cost­
cost
test
and
provide
data
to
determine
if
compliance
with
the
Subpart
N
requirements
would
result
in
compliance
costs
wholly
out
of
proportion
to
those
EPA
considered
in
establishing
the
requirement,
or
would
result
in
significant
adverse
impacts
on
local
water
resources
other
than
impingement
or
entrainment,
or
significant
adverse
impacts
on
energy
markets.
In
this
case,
alternative
requirements
may
be
imposed
in
the
permit.
See
the
Phase
I
final
preamble
for
a
more
detailed
explanation
of
this
cost­
cost
test
at
66
FR
65322,
which
is
different
than
the
cost­
cost
test
for
Phase
II
facilities.

EPA's
data
suggest
that
the
only
physical
technology
controls
for
entrainment
at
facilities
with
sea
chests
and
non­
fixed
(
i.
e.,
mobile)
facilities
would
entail
installation
of
equipment
projecting
beyond
the
hull
of
the
vessel
or
facility.
Such
controls
may
not
be
practical
or
feasible
since
the
configuration
may
alter
fluid
dynamics
and
impede
safe
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
41
seaworthy
travel,
even
for
new
facilities
that
could
avoid
the
challenges
of
retrofitting
control
technologies.
As
such,
EPA
is
not
promulgating
national
entrainment
controls
(
e.
g.,
use
of
planar
wedgewire
screens)
for
fixed
facilities
with
sea
chests
or
mobile
facilities
in
this
final
rule.

C.
Existing
Facilities
with
Cooling
Water
Intake
Structures
For
existing
Phase
III
facilities,
EPA
determined
that
uniform
national
technology­
based
standards
are
not
the
most
effective
way
to
address
cooling
water
intake
structures
existing
Phase
III
facilities
because
the
use
of
national
categorical
requirements
would
result
in
an
unacceptable
cost­
benefit
ratio.
Instead,
EPA
believes
that
it
is
better
at
this
time
to
utilize
the
existing
National
Pollutant
Discharge
Elimination
System
(
NPDES)
program,
which
implements
section
316(
b)
on
a
case­
by­
case,
best
professional
judgment
basis.
This
rule
does
not
alter
the
regulatory
requirements
for
facilities
subject
to
the
Phase
I
or
Phase
II
regulations.

This
rule
clarifies
that
any
cooling
water
intake
structure
not
subject
to
the
national
categorical
requirements
in
Phase
I,
Phase
II,
or
Phase
III
of
EPA's
316(
b)

regulation
development
is
still
subject
to
section
316(
b).
For
example,
existing
power
generators
with
a
design
intake
flow
of
less
than
50
MGD,
new
seafood
processing
vessels,
and
existing
manufacturers
are
not
subject
to
national
section
316(
b)
categorical
requirements,
but
these
facilities
continue
to
be
subject
to
316(
b)
requirements
set
by
the
Director
on
a
case­
by­
case
basis.
Interagency
Review
Draft­­
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Deliberative:
do
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cite,
quote
or
distribute
42
VI.
Basis
for
the
Final
Rule
Decision
This
section
discusses
EPA's
basis
for
final
requirements
applicable
to
new
offshore
oil
and
gas
extraction
facilities
and
EPA's
decision
to
apply
case­
by­
case,
best
professional
judgement
permit
conditions
implementing
CWA
section
316(
b)
at
existing
Phase
III
facilities.

A.
Why
is
EPA
Promulgating
National
Requirements
for
New
Offshore
and
Coastal
Oil
and
Gas
Extraction
Facilities?

After
EPA
proposed
the
Phase
I
rule
for
new
facilities
(
65
FR
49060,
August
10,

2000),
the
Agency
received
adverse
comment
from
operators
of
offshore
and
coastal
(
collectively
"
offshore")
drilling
facilities
concerning
the
limited
information
about
their
cooling
water
intakes,
associated
impingement
mortality
and
entrainment,
costs
of
technologies,
or
achievability
of
the
controls
proposed
by
EPA.
On
May
25,
2001,
EPA
published
a
Notice
of
Data
Availability
(
NODA)
for
Phase
I
that,
in
part,
sought
additional
data
and
information
about
mobile
offshore
and
coastal
drilling
facilities
(
see
66
FR
28857).
In
the
Phase
I
final
rule,
EPA
committed
to
"
propose
and
take
final
action
on
regulations
for
new
offshore
oil
and
gas
extraction
facilities,
as
defined
at
40
CFR
435.10
and
40
CFR
435.40,
in
the
Phase
III
section
316(
b)
rule."
See
66
FR
65256.
This
regulation
establishes
national
requirements
for
new
offshore
oil
and
gas
extraction
facilities
that
meet
the
applicability
requirements
in
§
125.131.

Requirements
for
new
offshore
oil
and
gas
extraction
facilities
are
specified
in
a
new
Subpart
N
of
Part
125.
New
onshore
oil
and
gas
extraction
facilities
are
currently
regulated
by
section
316(
b)
Phase
I
requirements
if
these
facilities
meet
the
applicability
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
43
criteria
of
the
316(
b)
Phase
I
regulations.
As
described
in
more
detail
below,
the
requirements
for
the
offshore
facilities
are
similar
to
some,
but
not
all,
of
the
requirements
contained
in
the
Phase
I
rule
applicable
to
other
new
facilities.
For
example,
the
Phase
I
requirement
to
reduce
intake
flow
commensurate
with
a
closedcycle
recirculating
cooling
system
does
not
apply
to
these
offshore
facilities.

This
rule
distinguishes
between
new
offshore
oil
and
gas
facilities
that
are
"
fixed,"
and
those
that
are
not
fixed.
For
"
fixed"
facilities,
the
rule
further
distinguishes
between
those
with
sea
chests
and
those
without.
Under
this
rule,
new
offshore
oil
and
gas
extraction
facilities
that
meet
the
applicability
criteria
in
§
125.131
and
that
employ
sea
chests
as
cooling
water
intake
structures
and
are
fixed
facilities
would
have
to
comply
with
the
requirements
in
§
125.134(
b)(
1)(
ii).
These
requirements
address
intake
flow
velocity,
percentage
of
the
source
waterbody
withdrawn
(
if
applicable),
specific
impact
concerns
(
e.
g.,
threatened
or
endangered
species,
critical
habitat,
migratory
or
sport
or
commercial
species),
required
information
submission,
monitoring,
and
recordkeeping.

Under
this
rule,
new
offshore
oil
and
gas
extraction
facilities
that
meet
the
applicability
criteria
in
§
125.131,
that
do
not
employ
sea
chests
as
cooling
water
intake
structures,
and
are
fixed
facilities
would
have
to
comply
with
the
requirements
in
§
125.134(
b)(
1)(
i).

The
one
additional
requirement
for
these
facilities
is
§
125.134(
b)(
5),
which
requires
the
selection
and
implementation
of
design
and
construction
technologies
or
operational
measures
to
minimize
entrainment
of
entrainable
life
stages
of
fish
or
shellfish.
Fixed
facilities
can
also
choose
to
comply
through
Track
II,
which
allows
a
site­
specific
demonstration
that
alternative
requirements
would
produce
comparable
levels
of
impingement
mortality
and
entrainment
reduction.
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
44
New
offshore
oil
and
gas
facilities
that
are
not
fixed
facilities
would
have
to
comply
with
the
regulations
at
§
125.134(
b)(
1)(
iii),
which
address
intake
flow
velocity,

specific
impact
concerns
(
e.
g.,
threatened
or
endangered
species,
critical
habitat,

migratory
or
sport
or
commercial
species),
required
information
submission,
monitoring,

and
recordkeeping.
Track
II
is
not
available
to
non­
fixed
(
mobile)
facilities
because
nonfixed
facilities,
which
are
expected
to
operate
at
multiple
locations,
would
not
be
able
to
perform
a
site­
specific
demonstration.
For
this
same
reason,
EPA
has
dropped
some
of
the
other
site­
dependent
requirements
for
non­
fixed
facilities
(
e.
g.,
source
waterbody
flow
information).

EPA
has
limited
information
on
specific
environmental
impacts
associated
with
the
use
of
cooling
water
intake
structures
at
new
offshore
oil
and
gas
extraction
facilities
but
believes
the
potential
for
such
impacts
is
sufficient
to
warrant
including
requirements
for
new
offshore
oil
and
gas
extraction
facilities
in
this
rule
(
see
section
IV
for
more
detailed
discussion).
SEAMAP
data
for
the
Gulf
of
Mexico
identified
over
600
different
fish
taxa
and
indicate
that
ichthyoplankton
occurs
throughout
the
Gulf
of
Mexico,
with
densities
highest
(
e.
g.,
average
densities
greater
than
450
organisms/
100
m3)
at
sampling
stations
in
the
shallower
regions
(
less
than
50
meters
deep)
of
the
Gulf,
and
lower
in
deeper
waters.
(
70
FR
71,059
 
71,060).
Most
offshore
oil
and
gas
facilities
operate
any
cooling
water
intake
structure
in
these
near­
surface
(
e.
g.,
20
 
100
feet
deep)
waters,

rather
than
in
deeper
waters.
(
TDD,
Chap.
3,
Sec.
III).
As
stated
earlier
in
this
preamble,

offshore
oil
and
gas
extraction
facilities
have
been
shown
to
attract
and
concentrate
aquatic
organisms
in
the
immediate
vicinity
of
the
underwater
portions
of
their
structures.

Data
also
indicate
the
presence
of
aquatic
organisms
identified
off
the
California
and
Interagency
Review
Draft­­
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do
not
cite,
quote
or
distribute
45
Alaska
coasts,
both
additional
areas
of
offshore
oil
and
gas
production.
In
addition,

although
such
technologies
are
not
generally
in
use
at
all
existing
offshore
oil
and
gas
extraction
facilities,
technologies
are
in
use
and
are
available
to
new
facilities
in
this
subcategory
to
meet
the
requirements
as
described
below.

Some
offshore
oil
and
gas
extraction
facilities
employ
an
underwater
compartment
within
the
facility
or
vessel
hull
or
pontoon
through
which
sea
water
is
drawn
in
or
discharged,
often
called
a
"
sea
chest."
A
passive
screen
(
strainer)
is
often
set
along
the
flush
line
of
the
sea
chest.
Pumps
draw
seawater
from
open
pipes
in
the
sea
chest
cavity
for
a
variety
of
purposes
(
e.
g.,
cooling
water,
fire
water,
and
ballast
water).

These
intakes
are
normally
the
only
source
of
cooling
water
for
the
facility;
therefore,
it
is
crucial
to
the
operation
of
these
facilities
that
the
intake
structures
be
kept
clean
and
clear
of
fish,
jellyfish,
plastic
bags,
and
other
debris.
To
accomplish
this,
these
intake
structures
can
be,
and
have
been,
designed
for
low
intake
velocity
(
i.
e.,
less
than
0.5
feet
per
second)
and/
or
include
fish
protection
equipment.
See
the
Technical
Development
Document
for
details.

As
outlined
in
Alaska's
oil
and
gas
leasing
requirements
(
see
[
DCN
9­
XXXX]),

oil
and
gas
extraction
facilities
in
Alaskan
State
waters
are
currently
subject
to
an
impingement
control
velocity
limit
of
0.1
feet
per
second
(
i.
e.,
more
stringent
than
EPA's
design
requirement
of
0.5
feet
per
second
in
the
Phase
I
new
facility
rule
to
minimize
impingement
mortality
of
aquatic
organisms).
These
State
regulations
suggest
that
impingement
controls
that
would
meet
the
velocity
requirements
of
this
rule
are
demonstrated
as
available
for
offshore
oil
and
gas
extraction
facilities
in
Alaskan
or
similar
waters.
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
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cite,
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or
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46
However,
facilities
using
sea
chests
may
have
few,
if
any,
opportunities
to
meet
the
entrainment
control
requirements
applicable
to
facilities
subject
to
the
Phase
I
rule.
A
2003
literature
survey
by
Mineral
Management
Services
(
DCN
7­
0012)
identified
no
evidence
of
entrainment
controls
successfully
fitted
to
offshore
oil
and
gas
extraction
vessels
with
sea
chests
such
as
drill
ships,
jack­
ups,
MODUs,
and
barges.
EPA's
data
suggests
that
the
only
physical
technology
controls
available
for
entrainment
at
facilities
with
sea
chests
would
entail
installation
of
equipment
projecting
beyond
the
hull
of
the
vessel.
Such
controls
may
not
be
feasible
due
to
facility
design
requirements,
even
for
new
facilities
that
could
avoid
the
challenges
of
retrofitting
control
technologies.

EPA
also
considered
whether
all
new
offshore
vessels
could
be
constructed
without
employing
sea
chests.
A
technology
must
prove
to
be
practicable
to
be
a
viable
alternative
to
current
technology.
In
this
case,
a
viable
alternative
to
a
sea
chest
is
any
alternative
configuration/
technology
successfully
implemented
at
existing
facilities,

including
those
in
other
manufacturing
industries,
with
similar
seawater
intake
structures.

EPA
data
suggest
the
only
demonstrated
design
for
drill
ships
and
semi­
submersible
MODUs
is
to
use
sea
chests
because
they
allow
the
vessel
to
maintain
appropriate
fluid
dynamics,
overall
optimal
vessel
shape,
and
a
safe
seaworthy
profile.
Therefore,
building
new
offshore
oil
and
gas
facilities
without
sea
chests
is
impracticable.
As
noted
above,

facilities
with
sea
chests
would
not
be
able
to
meet
entrainment
requirements
without
installing
a
technology
that
projects
outward
from
the
vessel's
hull.
This
outward
projection
has
been
shown
to
create
similar
problems
with
the
respect
to
fluid
dynamics,

vessel
shapes
and
safe
seaworthy
profile.
Therefore,
EPA
does
not
believe
entrainment
controls
are
feasible
at
such
facilities.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
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cite,
quote
or
distribute
47
For
new
fixed
offshore
oil
and
gas
extraction
facilities
with
intake
structures
other
than
sea
chests,
EPA
believes
that
both
impingement
and
entrainment
controls
are
feasible.
For
example,
technologies
to
reduce
impingement
mortality
and
entrainment
of
marine
life
at
a
caisson
intake
structure8
may
be
passive
intake
screens
or
velocity
caps.

Other
technologies
such
as
acoustic
barriers,
electro
barriers,
or
intake
relocation
may
also
be
used
to
reduce
impingement
and
entrainment
at
intake
structures.
Air
sparges
and
copper
nickel
alloys
can
also
be
used
to
control
biofouling.
EPA
has
concluded
that
these
are
all
"
available"
technologies
for
these
facilities
and
therefore
justify
impingement
and
entrainment
requirements.

In
summary,
EPA
is
establishing
requirements
that
are
similar
to
some
 
but
not
all
 
of
the
Phase
I
provisions.
EPA
is
doing
so
because
there
are
differences
in
technological
availability
between
offshore
oil
and
gas
extraction
facilities
and
those
facilities
covered
in
the
Phase
I
rule.

Impingement
and
entrainment
requirements
for
new
offshore
oil
and
gas
facilities
are
not
based
on
closed­
cycle
recirculating
cooling
because
available
information
indicates
that
it
is
not
feasible
for
all
new
offshore
oil
and
gas
extraction
facilities
to
employ
closed­
cycle
recirculating
cooling
systems.
The
rest
of
the
requirements
are
similar
to
those
in
Phase
I
(
e.
g.,
velocity
information
and
design
and
construction
technology
plan
for
Track
I
facilities,
comprehensive
demonstration
study
for
Track
II
facilities.)

8
A
caisson
intake
(
a
steel
pipe
attached
to
a
fixed
structure
that
extends
from
an
operating
area
down
some
distance
into
the
water)
is
used
to
provide
a
protective
shroud
around
another
process
pipe
or
pump
that
is
lowered
into
the
caisson
from
the
operating
area.
Interagency
Review
Draft­­
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Deliberative:
do
not
cite,
quote
or
distribute
48
B.
Why
is
EPA
Implementing
CWA
Section
316(
b)
at
Existing
Phase
III
Facilities
Through
Case­
By­
Case,
Best
Professional
Judgment
Permit
Conditions?

Based
on
consideration
of
available
data,
analyses
and
comments,
EPA
has
decided
not
to
promulgate
a
national
categorical
rule
today
for
Phase
III
existing
facilities.
EPA
bases
this
decision
on
EPA's
judgment
that
the
ratio
of
costs
to
the
expected
benefits
of
the
proposed
national
categorical
rule
options
are
unacceptable.

This
does
not
mean
that
Phase
III
facilities
will
escape
impingement
and
entrainment
controls.
Rather,
permit
writers
must
impose
impingement
and/
or
entrainment
controls
under
Section
316(
b)
on
a
case­
by­
case,
best
professional
judgment
basis.

Regulatory
Planning
and
Review
Executive
Order
12866
or
"
EO
12866"

(
September,
1993)
sets
forth
a
policy
that
agencies
should
"
assess
all
costs
and
benefits
of
regulatory
alternatives,
including
the
alternative
of
not
regulating."
The
executive
order
acknowledges
that
some
costs
and
benefits
are
difficult
to
quantify.
Consistent
with
this
policy,
EPA
has
looked
to
the
cost­
use
benefit
ratio
and
also
considered
non­
use
benefits
in
reaching
its
final
decision
for
Phase
III
existing
facilities.

As
presented
in
section
X
of
this
preamble,
EPA
estimated
that
the
total
pre­
tax
costs
of
the
50
MGD
option
would
be
$
38.2
to
$
39
million
and
the
monetized
use
benefits
would
be
$
1.8
to
$
2.3
million
($
2004,
7
percent
and
3
percent
discount
rates).

This
yields
a
cost
to
benefit
ratio
ranging
from
a
low
of
19
to
1
to
a
high
of
24
to
1.
EPA
also
examined
the
cost
and
monetized
benefits
of
the
two
other
regulatory
options
EPA
had
co­
proposed.
Even
at
higher
flow
thresholds,
national
categorical
requirements
for
Phase
III
existing
facilities
still
result
in
ratios
of
estimated
monetized
costs
to
estimated
monetized
benefits
that
are
unacceptable.
The
total
annualized
costs
of
the
200
MGD
Interagency
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or
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49
option
would
be
$
22.8
to
$
24.1
million
and
the
monetized
benefits
would
be
$
1.2
to
$
1.5
million
($
2004,
7
percent
and
3
percent
discount
rates,
respectively),
yielding
a
cost
to
benefit
ratio
ranging
from
a
low
of
16
to
1
to
a
high
of
19
to
1.
Similarly,
EPA
estimated
the
total
annualized
costs
of
the
100
MGD
option
to
be
$
17.6
to
$
18.2
and
the
monetized
benefits
to
range
from
$
1.1
to
$
1.4
million
($
2003,
3
percent
and
7
percent
discount
rate,

respectively),
resulting
in
a
cost­
to­
benefit
ratio
ranging
from
a
low
of
13
to
1
to
a
high
of
16
to
1.

EPA
also
considered
non­
quantified
benefits
in
reaching
its
final
decision.

Nonuse
benefits
may
arise
from
reduced
impacts
to
ecological
resources
that
the
public
considers
important.
This
may
include
reduced
impacts
to
threatened
or
endangered
species
or
to
species
without
direct
commercial
or
recreational
fishing
value,
such
as
forage
fish,
which
play
a
role
in
the
functioning
of
an
aquatic
ecosystem.
Non­
use
benefits
can
generally
only
be
monetized
through
the
use
of
stated
preference
methods.

As
described
in
the
Benefits
Analysis,
EPA
was
not
able
to
monetize
aggregate
non­
use
benefits
for
this
national
rulemaking.
Instead,
EPA
qualitatively
considered
the
impact
of
the
potential
non­
use
benefits
in
making
the
decision
to
employ
the
BPJ
approach
for
existing
Phase
III
facilities.
Doing
so
is
consistent
with
the
policy
outlined
in
EO
12866,

EPA's
Phase
III
proposal,
and
EPA's
past
practice
of
fully
evaluating
benefits
for
purposes
of
section
316(
b).
EPA
took
into
account
the
uncertainty
inherent
in
qualitative
benefits
assessment,
magnitude
of
the
cost­
use
benefit
ratio,
policy
concerns
over
burdening
manufacturers,
and
other
policy
concerns
outlined
in
this
preamble.
When
fully
considering
these
non­
monetized
benefits
in
light
of
all
of
these
factors,
EPA
determined
that
they
were
not
likely
to
be
of
sufficient
magnitude
to
alter
EPA's
decision
Interagency
Review
Draft­­
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Deliberative:
do
not
cite,
quote
or
distribute
50
to
continue
to
use
a
case­
by­
case,
best
professional
judgment
approach
to
existing
Phase
III
facilities.

EPA's
decision
to
reject
a
national
categorical
rule
for
Phase
III
existing
facilities
based
on
a
cost­
benefit
analysis
was
motivated
by
three
important
considerations:
(
1)
the
fact
that
this
rule
would
have
principally
affected
the
manufacturing
sector;
(
2)
the
fact
that
the
vast
majority
of
the
environmental
benefit
has
already
been
realized
by
the
Phase
II
rule;
and
(
3)
the
fact
that
effective
control
of
cooling
water
intake
structures
for
the
purpose
of
minimizing
adverse
environmental
impacts
can
be
achieved
through
sitespecific
decisionmaking.
Because
of
the
unique
confluence
of
these
considerations,
EPA
found
the
results
of
its
cost­
benefit
analysis
to
be
particularly
compelling.

The
federal
government
has
particular
concern
in
ensuring
benefits
justify
costs
when
manufacturing
facilities
are
involved.
According
to
"
Manufacturing
in
America:
A
Comprehensive
Strategy
to
Address
the
Challenges
to
U.
S.
Manufacturers"
(
U.
S.

Department
of
Commerce,
January
2004),
manufacturers
have
"
focused
on
reducing
costs
to
improve
productivity
and
ensure
their
competitiveness."
At
the
same
time,

according
to
that
report,
some
manufacturers
have
found
these
efforts
"
eroded
by
costs
they
cannot
control
­­
costs
that
result
in
part
from
government
policy."
In
another
report,
entitled
"
Regulatory
Reform
of
the
U.
S.
Manufacturing
Sector"
(
U.
S.
Office
of
Management
and
Budget,
2005),
streamlining
regulation
was
identified
as
"
a
key
plank
in
the
President's
economic
program."

Recognizing
the
regulatory
burdens
upon
manufacturers
is
becoming
more
important.
The
costs
of
regulatory
compliance
have
risen
significantly
over
time
and
U.
S.
manufacturers
face
considerably
higher
compliance
costs
than
do
many
of
the
U.
S.'
s
Interagency
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Draft­­
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Deliberative:
do
not
cite,
quote
or
distribute
51
trading
partners.
One
OMB
study
found
that
regulatory
costs
in
1997
comprise
3.7
percent
of
gross
domestic
product
(
GDP)
("
Report
to
Congress
on
the
Costs
and
Benefits
of
Federal
Regulations,"
September
1997).
Since
U.
S.
manufacturers
compete
with
other
firms
from
both
developed
and
developing
countries
in
a
global
economy,
any
additional
regulatory
costs
should
be
carefully
evaluated
in
order
to
ensure
U.
S.
firms'
continued
competitiveness
in
the
global
marketplace.
To
address
these
concerns
for
U.
S.

manufacturers,
benefits
justifying
costs
is
of
paramount
importance.

The
second
important
factor
underlying
EPA's
decision
to
rely
on
a
cost­
benefit
justification
here
is
the
fact
that
the
existing
national
categorical
316(
b)
regulations
already
address
the
majority
of
cooling
water
withdrawals.
As
a
result
of
the
Phase
II
rule,
approximately
90
percent
of
the
total
volume
of
cooling
water
withdrawn
nationally
is
already
subject
to
national
categorical
requirements.
The
2003
Phase
II
final
rule
regulates
an
estimated
543
facilities
and
367,752
MGD
maximum
water
withdrawals.

Reductions
in
fish
impinged
and
entrained
were
estimated
at
1.4
billion
one
year
equivalents.

If
EPA
had
decided
to
regulate
additional
cooling
water
intake
structures
at
existing
Phase
III
facilities
through
national
categorical
requirements
at
the
50
MGD
threshold,
the
new
national
categorical
rule
would
have
increased
the
number
of
facilities
subject
to
national
categorical
316(
b)
requirements
by
an
estimated
146
facilities,
or
a
27
percent
increase
in
total
facilities.
At
the
same
time,
cooling
water
withdrawals
subject
to
national
categorical
requirements
would
be
increased
by
29,308
MGD,
or
an
incremental
increase
of
8
percent.
Reductions
in
the
numbers
of
fish
impinged
and
entrained
by
existing
Phase
III
facilities
with
more
than
a
50
MGD
design
intake
flow
were
estimated
Interagency
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Draft­­
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Deliberative:
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not
cite,
quote
or
distribute
52
at
97
million,
or
a
7
percent
increase
incremental
to
Phase
II.
A
key
reason
for
this
is
that,
on
a
per­
facility
basis,
a
Phase
III
national
categorical
rule
with
a
flow
threshold
of
50
MGD
would
regulate
much
smaller
flows
than
are
addressed
under
Phase
II.
For
example,
the
average
design
intake
flow
(
DIF)
at
a
Phase
II
facility
is
667
MGD.
In
contrast,
the
average
DIF
at
a
Phase
III
facility
with
more
than
50
MGD
is
226
MGD.

Such
lower
flows
support
EPA's
determination
that
a
national
categorical
rule
for
Phase
III
facilities
is
not
warranted.

These
analyses
show
the
majority
of
large
flow
facilities
and
cooling
water
intake
flows
are
already
regulated
by
the
final
Phase
II
rule.
Most
of
the
reductions
in
fish
impinged
and
entrained
at
existing
facilities,
and
therefore
most
of
the
benefits,
are
also
already
obtained
through
implementation
of
the
Phase
II
regulations.
The
200
MGD
and
100
MGD
co­
proposed
options
involved
even
less
flow
and
fewer
regulated
facilities
than
the
50
MGD
option.

Finally,
EPA's
decision
to
rely
on
a
cost­
benefit
rationale
in
this
particular
regulatory
context
is
motivated
by
the
fact
that
Section
316(
b)
is
conducive
to
case­
by­
case
decisionmaking.
Under
section
316(
b),
NPDES
permits
must
require
that
the
location,
design,
construction,
and
capacity
of
cooling
water
intake
structures
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact,
and
EPA
is
accorded
discretion
in
implementing
section
316(
b).
Those
requirements
can
be
based
on
national
categorical
regulations,
as
was
the
case
with
the
Phase
I
and
Phase
II
rules,
or
on
site­
specific
determinations,
as
is
the
case
for
all
facilities
outside
the
scope
of
those
two
rules.
EPA
recognized
in
its
Phase
II
rule
itself
that
some
facilities
could
properly
have
316(
b)
requirements
established
considering
site­
specific
considerations,
through
the
cost­
benefit
or
cost­
cost
compliance
alternatives.
For
Phase
III,

EPA
determined
that
a
site­
specific
approach
was
appropriate
for
all
potential
Phase
III
existing
facilities.

In
sum,
while
permit
conditions
to
implement
section
316(
b)
requirements
are
necessary
under
the
CWA,
a
national
categorical
rule
is
not.
Interagency
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Draft­­
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not
cite,
quote
or
distribute
53
That
section
316(
b)
readily
accommodates
case­
by­
case
decisionmaking
is
confirmed
by
its
own
terms.
The
statute
speaks
in
terms
of
site­
specific
characteristics:
not
only
the
end
goal
of
minimizing
adverse
environmental
impacts
associated
with
a
facility's
cooling
water
intake
structure,
but
also
the
features
of
the
cooling
water
intake
structure
itself,
i.
e.,
its
"
location,
design,
construction,
and
capacity."

While
EPA
had
determined
in
the
context
of
both
new
facilities
and
existing
power
generating
facilities
that
these
categories
were
amenable
to
national
categorical
regulation,
in
the
case
of
manufacturing
facilities
EPA
has
determined
that
site­
specific
decisionmaking
is
a
better
approach,
with
the
permit
writer
rather
than
EPA
applying
the
statutory
decision
factors.
Indeed,
BPJ
decisionmaking
does
not
necessarily
diminish,
and
indeed
may
even
enhance,
environmental
protection
when
compared
to
national
rulemaking,

which
necessarily
looks
at
economic,
technical,
and
other
considerations
(
such
as
cost­
benefit
ratios),
from
a
sweeping
categorical
perspective
irrespective
of
the
capability
of
individual
facilities.

For
the
foregoing
reasons,
EPA
has
decided,
based
on
its
assessment
of
costs
and
benefits
in
this
rulemaking,
to
continue
to
rely
on
permit
writers'
use
of
their
best
professional
judgment
to
establish
the
statutorily
mandated
section
316(
b)
requirements
on
a
case­
by­
case
basis
for
existing
Phase
III
facilities.
Interagency
Review
Draft­­
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do
not
cite,
quote
or
distribute
54
VII.
Summary
of
Major
Comments
and
Responses
to
the
Proposed
Rule
and
Notice
of
Data
Availability
(
NODA)

Fifty
one
organizations
and
individuals
submitted
comments
on
a
range
of
issues
in
the
proposed
rule.
An
additional
six
comments
were
received
on
the
NODA.
Detailed
responses
to
all
comments,
including
those
summarized
here,
can
be
found
in
the
Response
to
Comments
document
in
the
official
public
docket.

A.
Offshore
Oil
and
Gas
Extraction
Facilities
Commenters
raised
many
issues
concerning
the
regulation
of
offshore
oil
and
gas
extraction
facilities.
One
commenter
requested
that
EPA
exclude
MODUs
from
the
rule.

A
few
commenters
also
claimed
that
EPA
did
not
demonstrate
a
need
to
regulate
offshore
oil
and
gas
extraction
facilities.
Another
commenter
asserted
that
new
offshore
oil
and
gas
extraction
facilities
should
be
included
under
the
new
facility
definition
promulgated
under
Phase
I.

One
commenter
suggested
that
EPA
exempt
offshore
oil
and
gas
extraction
facilities
employing
sea
chests
to
facilitate
international
movement
of
MODUs.
This
commenter
and
others
also
requested
that
EPA
establish
a
higher
minimum
flow
threshold
(
of
at
least
25
MGD)
for
offshore
oil
and
gas
units
in
shallow
waters,
and
exempt
units
in
unproductive
deep
waters
(
over
100
meters
deep).

One
commenter
added
that
the
ichthyoplankton
density
data
(
SEAMAP
data)

provided
in
the
NODA
supports
the
assertion
that
location
alone
should
be
used
to
regulate
requirements
for
offshore
oil
and
gas
extraction
facilities
and
supports
the
exemption
of
units
in
unproductive
waters
offshore.
The
commenter
stated
that
the
Interagency
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cite,
quote
or
distribute
55
SEAMAP
data
shows
that
these
waters
have
significantly
reduced
levels
of
biological
life.
Several
commenters
expressed
concern
that
intake
technologies
from
other
industries
may
not
be
appropriate
for
offshore
oil
and
gas
extraction
facilities.

As
presented
in
the
NODA,
EPA
collected
biological
data
from
the
Gulf
of
Mexico
and
other
locations
demonstrating
that
there
is
a
potential
for
adverse
environmental
impacts
due
to
the
operation
of
cooling
water
intake
structures
at
new
offshore
oil
and
gas
extraction
facilities.
While
the
data
did
show
spatial
and
temporal
variations,
as
well
as
variability
at
different
depths,
the
range
of
ichthyoplankton
densities
found
were
within
the
same
range
seen
in
coastal
and
inland
waterbodies
addressed
by
the
Phase
I
final
rule.
As
discussed
in
section
IX,
there
is
no
economic
barrier
for
new
offshore
oil
and
gas
facilities
to
meet
the
performance
standards
as
proposed.
Based
in
part
on
these
results,
EPA
is
addressing
new
offshore
oil
and
gas
extraction
facilities
in
this
final
rule.
EPA
proposed
to
set
a
regulatory
threshold
of
2
MGD
for
new
offshore
oil
and
gas
facilities.
EPA
has
not
identified
nor
have
commenters
provided
a
basis
for
selecting
an
alternative
regulatory
threshold.
Therefore,
consistent
with
the
Phase
I
rule,

new
offshore
oil
and
gas
extraction
facilities
with
a
design
intake
flow
greater
than
2
MGD
are
subject
to
this
rule.

EPA
recognizes
the
inherent
differences
in
the
design
and
operation
of
land­
based
and
offshore
facilities
(
as
well
as
the
differences
between
the
several
types
of
offshore
facilities)
and
has
adopted
a
regulatory
approach
that
allows
new
offshore
oil
and
gas
extraction
facilities
ample
flexibility
in
complying
with
the
rule.
EPA's
record
shows
the
technologies
evaluated
for
use
by
new
facilities
are
already
in
use
at
some
existing
offshore
facilities.
Furthermore,
EPA
does
not
have
any
(
and
commenters
did
not
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quote
or
distribute
56
provide)
data
to
suggest
that
MODUs
with
sea
chests
would
be
inhibited
from
international
movement.
Commenters
did
not
submit
any
information
that
would
lead
EPA
to
believe
that
the
intake
technologies
already
used
and
demonstrated
at
existing
facilities
are
inadequate
or
inappropriate
for
use
at
new
offshore
facilities.
However,

EPA
recognizes
that
differences
in
types
of
offshore
facilities
may
limit
the
technologies
available,
and
is
therefore
requiring
different
performance
standards
for
these
classes
of
facilities.
For
this
reason,
new
offshore
oil
and
gas
extraction
facilities
are
subject
to
a
new
Subpart
N
rather
than
being
included
under
the
new
facility
definition
promulgated
under
Phase
I.
As
discussed
in
section
II.
A
of
this
preamble,
new
offshore
oil
and
gas
extraction
facilities
are
defined
based
on
three
criteria,
one
of
which
is
that
the
facility
meets
the
definition
o
f
a
"
new
facility"
in
40
CFR
125.83.

B.
Applicability
to
Phase
III
Existing
Facilities/
Costs
&
Benefits
Numerous
commenters
argued
that
Phase
III
facilities
should
be
regulated
on
a
case­
by­
case
basis,
citing
the
proposed
rule's
high
cost,
low
benefits,
and
a
lack
of
Phase
III
data
indicating
environmental
harm.
Commenters
questioned
the
need
for
and
benefit
of
promulgating
national
standards
covering
existing
manufacturing
facilities
and
small
electric
utility
plants
that
comprise
smaller
cooling
water
flows.

Many
commenters
expressed
concern
over
the
high
costs
relative
to
the
monetized
benefits
of
all
three
regulatory
approaches
presented
in
the
proposed
rule.

Several
commenters
also
noted
a
poor
ratio
of
costs
to
monetized
benefits,
which
some
commenters
claimed
would
yield
pennies
of
benefit
per
dollar
of
cost.
Some
commenters
stated
that,
due
to
the
low
benefit
to
cost
ratio,
EPA
should
withdraw
the
proposed
rule.
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57
As
discussed
in
section
VI
of
this
preamble,
EPA
has
decided
not
to
promulgate
national
categorical
requirements
for
Phase
III
existing
facilities.
Section
316(
b)

requirements
for
these
facilities
will
continue
to
be
developed
using
a
best
professional
judgement­
based
approach.

C.
Environmental
Impacts
Associated
with
Cooling
Water
Intake
Structures
Many
commenters
asserted
that
there
is
no
demonstrated
need
for
national
requirements
at
Phase
III
facilities
since
Phase
III
facilities
have
much
smaller
flows
than
Phase
II
facilities.
These
commenters
also
noted
that
most
of
the
environmental
impact
data
cited
in
the
Phase
III
proposed
rule
is
from
Phase
II
power
generator
facilities
and
is
not
relevant
to
Phase
III
facilities.
One
commenter
stated
that
EPA
did
not
define
adverse
environmental
impact.
Another
commenter
argued
that
any
measure
of
impingement
or
entrainment
constitutes
adverse
environmental
impact.

Another
commenter
stated
that
the
low
number
of
316(
b)
studies
conducted
at
Phase
III
facilities
indicates
that
these
facilities
are
not
causing
a
problem.
Other
commenters
maintained
that
actual
national
impacts
due
to
cooling
water
intake
structures
are
vastly
underestimated
due
to
poor
data
collection
methodologies
utilized
when
the
majority
of
the
studies
were
performed
and
because
studies
conducted
on
impinged
and
entrained
organisms
overlooked
the
vast
majority
of
affected
species.

As
discussed
in
section
IV
of
this
preamble,
EPA
collected
impingement
mortality
and
entrainment
data
from
multiple
existing
facilities
including
many
Phase
III
facilities,
and
believes
that
the
data
is
sufficient
to
demonstrate
the
potential
for
adverse
environmental
impacts
by
Phase
III
facilities
(
see
also
Regional
Analysis
Document).
Interagency
Review
Draft­­
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or
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58
EPA
believes
that
using
data
from
Phase
II
facilities
to
supplement
data
from
Phase
III
facilities
is
appropriate
since
impacts
from
existing
cooling
water
intake
structures
occur
independent
of
industry
type.
In
the
NODA,
EPA
provided
data
from
surveyed
Phase
II
and
Phase
III
facilities
demonstrating
no
material
differences
between
electric
generators
or
the
various
manufacturing
industries
with
respect
to
intake
location,
types
of
intake,
or
technologies
installed
on
the
intakes.
70
FR
71059 
71060.
EPA
notes
that
it
received
no
comments
or
data
in
response
to
its
Phase
II
or
Phase
III
proposals
indicating
any
categorical
difference
in
cooling
water
intake
structures
between
Phase
II
and
those
Phase
III
facilities
addressed
in
this
final
action.

Consistent
with
discussions
presented
in
the
Phase
I
and
Phase
II
rules,
EPA
believes
that
it
is
reasonable
to
interpret
adverse
environmental
impact
as
the
loss
of
aquatic
organisms
due
to
impingement
mortality
and
entrainment.
Commenters
did
not
suggest
alternative
interpretations
of
adverse
environmental
impact.
For
additional
discussion,
see
section
IV
of
this
preamble.

EPA
believes
that
the
studies
collected
from
existing
facilities
and
utilized
in
its
analysis
of
impingement
and
entrainment
impacts
are
sufficient
to
estimate
and
generally
characterize
the
potential
for
national
level
impacts
for
the
purposes
of
this
action.
The
Regional
Analysis
document
discusses
a
number
of
issues
associated
with
the
quality
of
the
data
in
these
studies.
It
is
difficult
to
predict
the
effects
of
these
study
limitations
on
the
impacts
estimates,
specifically
whether
they
have
led
to
an
overestimate
or
underestimate
of
impacts.
EPA
acknowledges
that
the
studies
often
measure
impacts
to
only
some
of
the
fish
and
shellfish
species
impacted
by
cooling
water
intake
structures
and
typically
do
not
measure
impacts
to
other
marine
organisms
such
as
phytoplankton
or
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or
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59
numerous
types
of
invertebrates.
EPA's
quantitative
analysis
of
impacts
for
this
final
action
does
not
reflect
impacts
to
these
types
of
organisms
and
instead
only
considers
impacts
to
some
species
of
fish
and
shellfish.
Interagency
Review
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or
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60
VIII.
Implementation
Final
section
316(
b)
requirements
for
new
offshore
oil
and
gas
extraction
facilities
will
be
implemented
through
the
NPDES
permit
program.
This
final
rule
establishes
implementation
requirements
for
new
offshore
oil
and
gas
extraction
facilities
that
are
generally
consistent
with
Phase
I
requirements.
This
regulation
establishes
application
requirements
under
40
CFR
122.21
and
'
125.136,
monitoring
requirements
under
'

125.137,
and
record
keeping
and
reporting
requirements
under
'
125.138.
The
regulations
also
require
the
Director
to
review
application
materials
submitted
by
each
regulated
facility
and
include
monitoring
and
record
keeping
requirements
in
the
permit
('
125.139).

A.
When
Does
the
Final
Rule
Become
Effective?

This
rule
becomes
effective
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER].
Under
this
final
rule,
new
offshore
oil
and
gas
extraction
facilities
will
need
to
comply
with
the
Subpart
N
requirements
when
an
NPDES
permit
containing
requirements
consistent
with
Subpart
N
is
issued
to
the
facility
('
125.132).

B.
What
General
Information
Will
I
Be
Required
to
Submit
to
the
Director
When
I
Apply
for
My
Reissued
NPDES
Permit?

The
NPDES
regulations
that
establish
the
application
process
at
'
122.21
generally
require
that
facilities
currently
holding
a
permit
submit
information
and
data
180
days
prior
to
the
end
of
the
permit
term,
which
is
five
years.
Under
this
final
rule,
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or
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61
new
offshore
oil
and
gas
extraction
facilities
are
required
to
submit
the
information
that
is
required
under
'
122.21
with
their
application
for
permit
issuance
or
reissuance.

This
final
rule
modifies
regulations
at
'
122.21
to
require
new
offshore
oil
and
gas
extraction
facilities
to
prepare
and
submit
some
of
the
same
information
required
for
new
Phase
I
and
existing
Phase
II
facilities.
New
offshore
oil
and
gas
extraction
facilities
may
be
required
to
submit
the
Source
Water
Baseline
Biological
Characterization
Data
depending
on
whether
they
are
fixed
or
non­
fixed
facilities.
Non­
fixed
facilities
would
be
exempt
from
the
requirement.
Specific
data
requirements
for
the
Source
Water
Baseline
Biological
Characterization
Data
are
described
later
in
this
section.
Studies
to
be
submitted
by
new
offshore
oil
and
gas
extraction
facilities
are
described
below.

1.
Source
Water
Physical
Data
('
122.21(
r)(
2))

Under
the
requirements
at
'
122.21,
new
offshore
oil
and
gas
extraction
facilities
are
required
to
provide
the
source
water
physical
data
specified
at
'
122.21(
r)(
2)
in
their
application
for
a
reissued
permit.
These
data
are
needed
to
characterize
the
facility
and
evaluate
the
type
of
waterbody
and
species
potentially
affected
by
the
cooling
water
intake
structure.
The
Director
will
use
this
information
to
evaluate
the
appropriateness
of
the
design
and
construction
technologies
and/
or
operational
measures
proposed
by
the
applicant.

The
applicant
is
required
to
submit
the
following
specific
data:
(
1)
a
narrative
description
and
scale
drawings
showing
the
physical
configuration
of
all
source
waterbodies
used
by
the
facility,
including
areal
dimensions,
depths,
salinity
and
temperature
regimes,
and
other
documentation;
(
2)
an
identification
and
characterization
Interagency
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62
of
the
source
waterbody=
s
hydrological
and
geomorphological
features,
as
well
as
the
methods
used
to
conduct
any
physical
studies
to
determine
the
intake=
s
zone
of
influence
and
the
results
of
such
studies;
and
(
3)
locational
maps.
For
new
non­
fixed
(
mobile)

offshore
oil
and
gas
extraction
facilities,
this
provision
requires
only
some
of
the
location
information
and
not
the
source
water
physical
data
required
for
new
fixed
offshore
oil
and
gas
extraction
facilities.

EPA
recognizes
that
mobile
facilities
may
not
always
know
where
they
will
be
operating
during
the
permit
term,
and
the
requirement
in
(
r)(
2)(
iv)
is
not
meant
to
restrict
them
only
to
locations
identified
in
the
permit
application.
However,
EPA
expects
that
permit
applicants
will
provide,
based
on
available
information,
their
best
estimate
as
to
where
they
will
be
operating
during
the
permit
term,
at
whatever
level
of
detail
they
can.

2.
Cooling
Water
Intake
Structure
Data
('
122.21(
r)(
3))

New
offshore
oil
and
gas
extraction
facilities
are
required
to
submit
the
cooling
water
intake
structure
data
specified
at
'
122.21(
r)(
3)
to
characterize
the
cooling
water
intake
structure
and
evaluate
the
potential
for
impingement
and
entrainment
of
aquatic
organisms.
Note
that
'
122.21(
r)(
3)(
ii)
­
latitude
and
longitude
of
each
intake
structure
­

is
not
applicable
to
non­
fixed
(
mobile)
offshore
oil
and
gas
extraction
facilities.

Information
on
the
design
of
the
intake
structure
and
its
location
in
the
water
column
allows
the
permit
writer
to
evaluate
which
species
or
life
stages
are
potentially
subject
to
impingement
mortality
and
entrainment.
A
diagram
of
the
facility=
s
water
balance
is
used
to
identify
the
proportion
of
intake
water
used
for
cooling,
make­
up,
and
process
water.

The
water
balance
diagram
also
provides
a
picture
of
the
total
flow
in
and
out
of
the
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63
facility,
allowing
the
permit
writer
to
evaluate
the
suitability
of
proposed
design
and
construction
technologies
and/
or
operational
measures.

The
applicant
is
required
to
submit
the
following
specific
data:
(
1)
a
narrative
description
of
the
configuration
of
each
of
its
cooling
water
intake
structures
and
where
they
are
located
in
the
waterbody
and
in
the
water
column;
(
2)
latitude
and
longitude
in
degrees,
minutes,
and
seconds
for
each
of
its
cooling
water
intake
structures
(
not
applicable
to
new
non­
fixed
(
mobile)
offshore
oil
and
gas
extraction
facilities);
(
3)
a
narrative
description
of
the
operation
of
each
of
the
cooling
water
intake
structures,

including
design
intake
flows,
daily
hours
of
operation,
number
of
days
of
the
year
in
operation,
and
seasonal
operation
schedules,
if
applicable;
(
4)
a
flow
distribution
and
water
balance
diagram
that
includes
all
sources
of
water
to
the
facility,
recirculating
flows,
and
discharges;
and
(
5)
engineering
drawings
of
the
cooling
water
intake
structure.

The
flow
limit
in
'
125.131(
a)(
2)
is
based
on
total
design
intake
flow.
Total
design
intake
flow
should
be
specified
by
the
applicant
with
the
information
required
above.
A
facility
may
permanently
decrease
its
total
design
intake
flow
(
e.
g.,
by
removing
an
intake
structure
or
installing
intake
pumps
with
a
lower
maximum
capacity)

and
request
that
the
permitting
authority
consider
the
facility's
new
total
design
intake
flow
to
determine
the
applicability
of
the
316(
b)
Phase
III
Rule
at
the
time
of
permitting.

Note
that
for
facilities
which
have
variable
speed
pumps,
the
maximum
intake
capacity
for
the
cooling
water
intake
structure
is
the
total
combined
design
intake
flow
for
those
cooling
water
intake
structures.
Interagency
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64
C.
New
Offshore
Oil
and
Gas
Extraction
Facilities
Under
this
final
rule,
new
offshore
oil
and
gas
extraction
facilities
are
required
to
submit
the
application
requirements
consistent
with
'
122.21(
r)(
2)
(
except
(
r)(
2)(
iv)),
(
3),

and
(
4)
and
'
125.136
of
Subpart
N
if
they
are
fixed
facilities
and
choose
to
comply
with
the
Track
I
or
II
requirements
in
'
125.134(
b)
or
(
c).
A
fixed
facility
is
defined
as
a
bottom
founded
offshore
oil
and
gas
extraction
facility
permanently
attached
to
the
seabed
or
subsoil
of
the
outer
continental
shelf
(
e.
g.,
platforms,
guyed
towers,
articulated
gravity
platforms)
or
a
buoyant
facility
securely
and
substantially
moored
so
that
it
cannot
be
moved
without
a
special
effort
(
e.
g.,
tension
leg
platforms,
permanently
moored
semi­
submersibles)
and
which
is
not
intended
to
be
moved
during
the
production
life
of
the
well.
This
definition
does
not
include
MODUs
(
e.
g.,
drill
ships,
temporarily
moored
semi­
submersibles,
jack­
ups,
submersibles,
tender­
assisted
rigs,
and
drill
barges).

The
Track
I
and
Track
II
requirements
are
generally
consistent
with
the
Phase
I
requirements
for
new
facilities
(
66
FR
65256).
Under
Track
I,
this
includes
velocity
information,
source
waterbody
flow
information,
and
a
design
and
construction
technology
plan.
Track
II
requirements
include
source
waterbody
flow
information
and
Track
II
comprehensive
demonstration
study
(
including
source
water
biological
study,

evaluation
of
potential
cooling
water
intake
structure
effects,
and
verification
monitoring
plan).
These
requirements
are
detailed
later
in
this
section.

As
described
in
'
125.135,
fixed
facilities
have
the
opportunity
to
conduct
a
costcost
test
and
provide
data
to
determine
if
compliance
with
the
Subpart
N
requirements
would
result
in
compliance
costs
wholly
out
of
proportion
to
those
EPA
considered
in
establishing
the
requirement,
or
would
result
in
significant
adverse
impacts
on
local
water
Interagency
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65
resources
other
than
impingement
or
entrainment,
or
significant
adverse
impacts
on
energy
markets.
In
this
case,
alternative
requirements
may
be
imposed
in
the
permit.
See
the
Phase
I
final
preamble
for
a
more
detailed
explanation
of
this
cost­
cost
test
which
is
different
than
the
cost­
cost
test
for
Phase
II
facilities
(
66
FR
65256).

In
this
final
rule,
fixed
facilities
with
sea
chests
and
all
non­
fixed
(
or
Amobile@)

facilities
are
not
required
to
comply
with
standards
for
entrainment.
Fixed
facilities
with
sea
chests
may
choose
either
Track
I
or
Track
II
to
comply
with
impingement
mortality
performance
standards.
Non­
fixed
facilities
must
comply
with
the
0.5
feet
per
second
through­
screen
design
intake
flow
velocity
performance
standard
for
impingement
mortality
of
Track
I.
In
addition,
the
Director
may
determine
additional
design
and
construction
technologies
to
minimize
impingement
mortality
are
necessary
where
there
are
either
protected
species
or
critical
habitat
for
these
species
or
other
species
of
impingement
concern
within
the
hydrologic
zone
of
influence
of
the
cooling
water
intake
structure,
or
based
on
other
information
from
fishery
management
services
or
agencies.

The
new
mobile
facility,
when
applying
to
operate
under
a
general
permit,
must
identify
where
it
expects
to
be
operating.
The
Director
consults
with
the
fishery
management
agencies,
considers
their
data
as
well
as
any
other
relevant
data,
and
decides
whether
to
propose
additional
requirements
based
on
any
concerns
the
Director
identifies
(
see
'

125.134(
b)(
4)).
For
example,
Region
10
has
established
a
general
permit
for
Cooks
Inlet
that
established
a
0.1
feet
per
second
through­
screen
design
intake
flow
velocity
performance
standard.
However,
non­
fixed
facilities
are
not
required
to
submit
the
source
water
baseline
biological
characterization
data
and
some
aspects
of
the
source
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
66
water
physical
data
requirements.
Requirements
for
non­
fixed
facilities
are
described
later
in
this
section.

1.
For
New
Offshore
Oil
and
Gas
Extraction
Fixed
Facilities,
What
Information
is
Required
to
be
Collected
for
the
NPDES
Application?

Source
Water
Baseline
Biological
Characterization
Data
('
122.21(
r)(
4))
(
both
Track
I
and
II)

Under
this
final
rule,
new
offshore
oil
and
gas
extraction
fixed
facilities
are
required
to
submit
source
water
baseline
biological
characterization
data
as
required
under
Phase
I.
The
data
will
be
used
to
characterize
the
biological
community
in
the
vicinity
of
the
cooling
water
intake
structure
and
to
characterize
the
operation
of
the
cooling
water
intake
structure.
The
data
must
include
existing
data
(
if
available)

supplemented
with
new
field
studies
as
necessary.
Detailed
data
requirements
are
at
'

122.21(
r)(
4).
EPA
recognizes
that
many
offshore
oil
and
gas
extraction
facilities
are
regulated
under
NPDES
general
permits
and
that
regional
studies
are
typically
conducted
as
part
of
the
general
permit
requirements.
EPA
expects
that
some
new
offshore
oil
and
gas
extraction
fixed
facilities
may
choose
to
jointly
conduct
a
regional
study
to
collect
the
source
water
baseline
biological
characterization
data.
The
biological
conditions
characterized
by
a
regional
study
should
reflect
the
conditions
found
at
each
individual
cooling
water
intake
structure.
EPA
anticipates
the
regional
studies
would
be
conducted
once
each
permit
cycle.
Under
this
final
rule,
the
regional
study
would
also
include
annual
monitoring
requirements.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
67
Velocity
Information
(
Track
I)

The
final
rule
requires
that
new
offshore
oil
and
gas
extraction
fixed
facilities
submit
velocity
information
consistent
with
'
125.136(
b)(
2).
The
information
will
be
used
to
demonstrate
to
the
Director
that
the
facility
is
complying
with
the
requirement
to
meet
a
maximum
through­
screen
design
intake
velocity
of
no
more
than
0.5
feet
per
second
at
the
cooling
water
intake
structure.
The
following
information
must
be
submitted:
1)
a
narrative
description
of
the
design,
structure,
equipment,
and
operation
used
to
meet
the
velocity
requirement;
and
2)
design
calculations
showing
that
the
velocity
requirement
would
be
met
at
minimum
ambient
source
water
surface
elevations
(
based
on
best
professional
judgment
using
available
hydrological
data)
and
maximum
head
loss
across
the
screens
or
other
device
or,
if
the
facility
uses
devices
other
than
a
surface
intake
screen,
at
the
point
of
entry
to
the
device.

Source
Waterbody
Flow
Information
(
Track
I
and
II)

The
final
rule
also
requires
that
new
offshore
oil
and
gas
extraction
fixed
facilities
submit
source
waterbody
flow
information
in
accordance
with
'
125.136(
b)(
2)
or
(
c)(
1).

The
information
will
be
used
to
demonstrate
to
the
Director
that
the
facility=
s
cooling
water
intake
structure
meets
the
proportional
flow
requirements
at
'
125.134(
b)(
3)
or
(
c)(
2).
These
requirements
include
specific
provisions
for
fixed
facilities
located
on
estuaries
or
tidal
rivers
to
provide
greater
protection
for
these
sensitive
waters.

Specifically,
the
final
rule
requires
that
the
total
design
intake
flow
over
one
tidal
cycle
of
ebb
and
flow
must
be
no
greater
than
one
(
1)
percent
of
the
volume
of
the
water
column
within
the
area
centered
about
the
opening
of
the
intake
with
a
diameter
defined
by
the
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
68
distance
of
one
tidal
excursion
at
the
mean
low
water
level.
Calculations
and
guidance
on
determining
the
tidal
excursion
is
found
in
the
preamble
to
the
final
Phase
I
rule
at
section
VII.
B.
1.
d.

Design
and
Construction
Technology
Plan
(
Track
I)

The
final
regulation
requires
that
new
offshore
oil
and
gas
extraction
fixed
facilities
submit
a
design
and
construction
technology
plan
consistent
with
Subpart
N
requirements
at
'
125.136(
b)(
3).
The
design
and
construction
technology
plan
must
demonstrate
that
the
facility
has
selected
and
will
implement
the
design
and
construction
technologies
necessary
to
minimize
impingement
mortality
and/
or
entrainment
in
accordance
with
'
125.134(
b)(
4)
and/
or
(
5).
The
design
and
construction
technology
plan
requires
delineation
of
the
hydrologic
zone
of
influence
for
the
cooling
water
intake
structure;
a
description
of
the
technologies
implemented
(
or
to
be
implemented)
at
the
facility;
the
basis
for
the
selection
of
that
technology;
the
expected
performance
of
the
technology,
and
design
calculations,
drawings
and
estimates
to
support
the
technology
description
and
performance.
The
Agency
recognizes
that
the
selection
of
a
specific
technology
or
a
group
of
technologies
depends
on
the
individual
facility
and
waterbody
conditions.

Track
II
Comprehensive
Demonstration
Study
(
Track
II)

If
a
fixed
facility
chooses
to
comply
under
the
Track
II
approach,
the
facility
must
perform
and
submit
the
results
of
a
Comprehensive
Demonstration
Study
(
Study).
This
information
will
be
used
to
characterize
the
source
water
baseline
in
the
vicinity
of
the
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
69
cooling
water
intake
structure(
s);
characterize
operation
of
the
cooling
water
intake(
s);

and
to
confirm
that
the
technology(
ies)
proposed
and/
or
implemented
at
the
cooling
water
intake
structure
reduce
the
impacts
to
fish
and
shellfish
to
levels
comparable
to
those
the
facility
would
achieve
were
it
to
implement
the
applicable
requirements
in
'

125.134(
b)(
2)
and,
for
facilities
without
sea
chests,
in
'
125.134(
b)(
5).
To
meet
the
Acomparable
level@
requirement,
the
facility
must
demonstrate
that
it
has
reduced
both
impingement
mortality
and
entrainment
of
all
life
stages
of
fish
and
shellfish
to
90
percent
or
greater
of
the
reduction
that
would
be
achieved
through
the
applicable
requirements
in
'
125.134(
b)(
2)
and,
for
facilities
without
sea
chests,
in
'
125.134(
b)(
5).

Similar
to
the
Proposal
for
Information
Collection
required
in
Phase
II,
the
facility
must
develop
and
submit
a
plan
to
the
Director
containing
a
proposal
for
how
information
will
be
collected
to
support
the
study.
The
plan
must
include:

 
A
description
of
the
proposed
and/
or
implemented
technology(
ies)
to
be
evaluated
in
the
Study;

 
A
list
and
description
of
any
historical
studies
characterizing
the
physical
and
biological
conditions
in
the
vicinity
of
the
proposed
or
actual
intakes
and
their
relevancy
to
the
proposed
Study.
If
the
facility
proposes
to
rely
on
existing
source
waterbody
data,
the
data
must
be
no
more
than
5
years
old,
and
the
facility
must
demonstrate
that
the
existing
data
are
sufficient
to
develop
a
scientifically
valid
estimate
of
potential
impingement
mortality
and
entrainment
impacts,
and
provide
documentation
showing
that
the
data
were
collected
using
appropriate
quality
assurance/
quality
control
procedures;
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
70
 
Any
public
participation
or
consultation
with
Federal
or
State
agencies
undertaken
in
developing
the
plan;
and
 
A
sampling
plan
for
data
that
will
be
collected
using
actual
field
studies
in
the
source
waterbody.
The
sampling
plan
must
document
all
methods
and
quality
assurance
procedures
for
sampling,
and
data
analysis.
The
sampling
and
data
analysis
methods
proposed
must
be
appropriate
for
a
quantitative
survey
and
based
on
consideration
of
methods
used
in
other
studies
performed
in
the
source
waterbody.
The
sampling
plan
must
include
a
description
of
the
study
area
(
including
the
area
of
influence
of
the
cooling
water
intake
structure
and
at
least
100
meters
beyond);
taxonomic
identification
of
the
sampled
or
evaluated
biological
assemblages
(
including
all
life
stages
of
fish
and
shellfish);
and
sampling
and
data
analysis
methods.

The
facility
must
submit
documentation
of
the
results
of
the
Study
to
the
Director.

Documentation
of
the
results
of
the
Study
includes:
Source
Water
Biological
Study,
an
evaluation
of
potential
cooling
water
intake
structure
effects,
and
a
verification
monitoring
plan
as
described
below.

Source
Water
Biological
Study.

The
Source
Water
Biological
Study
must
include:

(
1)
A
taxonomic
identification
and
characterization
of
aquatic
biological
resources
including:
a
summary
of
historical
and
contemporary
aquatic
biological
resources;

determination
and
description
of
the
target
populations
of
concern
(
those
species
of
fish
and
shellfish
and
all
life
stages
that
are
most
susceptible
to
impingement
and
entrainment);
and
a
description
of
the
abundance
and
temporal/
spatial
characterization
of
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
71
the
target
populations
based
on
the
collection
of
multiple
years
of
data
to
capture
the
seasonal
and
daily
activities
(
e.
g.,
spawning,
feeding
and
water
column
migration)
of
all
life
stages
of
fish
and
shellfish
found
in
the
vicinity
of
the
cooling
water
intake
structure;

(
2)
An
identification
of
all
threatened
or
endangered
species
that
might
be
susceptible
to
impingement
and
entrainment
by
the
proposed
cooling
water
intake
structure(
s);
and
(
3)
A
description
of
additional
chemical,
water
quality,
and
other
anthropogenic
stresses
on
the
source
waterbody.

Evaluation
of
potential
cooling
water
intake
structure
effects.

This
evaluation
must
include:

(
1)
Calculations
of
the
reduction
in
impingement
mortality
and,
if
applicable,

entrainment
of
all
life
stages
of
fish
and
shellfish
that
would
need
to
be
achieved
by
the
technologies
selected
to
implement
to
meet
requirements
under
Track
II.
To
do
this,
the
facility
must
determine
the
reduction
in
impingement
mortality
and
entrainment
that
would
be
achieved
by
implementing
the
requirements
of
'
125.134(
b)(
2)
and,
for
facilities
without
sea
chests,
'
125.134(
b)(
5).

(
2)
An
engineering
estimate
of
efficacy
for
the
proposed
and/
or
implemented
technologies
used
to
minimize
impingement
mortality
and,
if
applicable,
entrainment
of
all
life
stages
of
fish
and
shellfish
and
maximize
survival
of
impinged
life
stages
of
fish
and
shellfish.
The
facility
must
demonstrate
that
the
technologies
reduce
impingement
mortality
and,
if
applicable,
entrainment
of
all
life
stages
of
fish
and
shellfish
to
a
comparable
level
to
that
which
would
be
achieved
if
the
facility
were
to
implement
the
requirements
in
'
125.134(
b)(
2)
and,
for
facilities
without
sea
chests,
'
125.134(
b)(
5).

The
efficacy
projection
must
include
a
site­
specific
evaluation
of
technology(
ies)
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
72
suitability
for
reducing
impingement
mortality
and
entrainment
based
on
the
results
of
the
Source
Water
Biological
Study.
Efficacy
estimates
may
be
determined
based
on
case
studies
that
have
been
conducted
in
the
vicinity
of
the
cooling
water
intake
structure
and/
or
site­
specific
technology
prototype
studies.

Verification
monitoring
plan.

The
fixed
facility
must
include
in
the
Study
a
plan
to
conduct,
at
a
minimum,
two
years
of
monitoring
to
verify
the
full­
scale
performance
of
the
proposed
or
implemented
technologies,
and/
or
operational
measures.
The
verification
study
must
begin
at
the
start
of
operations
of
the
cooling
water
intake
structure
and
continue
for
a
sufficient
period
of
time
to
demonstrate
that
the
facility
is
reducing
the
level
of
impingement
mortality
and
entrainment
to
the
level
documented
under
the
evaluation
of
potential
cooling
water
intake
structure
effects.
The
plan
must
describe
the
frequency
of
monitoring
and
the
parameters
to
be
monitored.
The
Director
will
use
the
verification
monitoring
to
confirm
that
the
facility
is
meeting
the
level
of
impingement
mortality
and
entrainment
reduction
required
in
'
125.134(
c),
and
that
the
operation
of
the
technology
has
been
optimized.

2.
As
an
Owner
of
Operator
of
a
New
Offshore
Oil
and
Gas
Extraction
Fixed
Facility,
What
Monitoring
is
Required?

Monitoring
requirements
for
new
offshore
oil
and
gas
extraction
fixed
facilities
vary
based
on
whether
the
facility
selects
Track
I
or
Track
II
and
has
a
sea
chest.
For
fixed
facilities
pursuing
Track
I
that
have
sea
chests,
no
monitoring
is
required.
For
fixed
facilities
pursuing
Track
I
that
do
not
have
sea
chests,
only
entrainment
monitoring
is
required.
Under
Track
II,
fixed
facilities
with
sea
chests
are
required
to
conduct
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
73
impingement
mortality
monitoring;
fixed
facilities
without
sea
chests
must
conduct
monitoring
for
both
impingement
mortality
and
entrainment.

Under
this
final
rule,
monitoring
must
characterize
the
impingement
and,
if
applicable,
entrainment
rates
of
commercial,
recreational,
and
forage
base
fish
and
shellfish
species
identified
in
either
the
Source
Water
Baseline
Biological
Characterization
data
required
by
40
CFR
122.21(
r)(
4)
or
the
Comprehensive
Demonstration
Study
required
by
'
125.136(
c)(
2),
depending
on
whether
the
facility
has
a
sea
chest.
The
monitoring
methods
used
must
be
consistent
with
those
used
for
the
Source
Water
Baseline
Biological
Characterization
data
required
in
40
CFR
122.21(
r)(
4)

or
the
Comprehensive
Demonstration
Study
required
by
'
125.136(
c)(
2).

The
fixed
facility
must
follow
the
monitoring
frequencies
identified
below
for
at
least
two
(
2)
years
after
the
initial
permit
issuance.
After
that
time,
the
Director
may
approve
a
request
for
less
frequent
sampling
in
the
remaining
years
of
the
permit
term
and
when
the
permit
is
reissued,
if
supporting
data
show
that
less
frequent
monitoring
would
still
allow
for
the
detection
of
any
seasonal
and
daily
variations
in
the
species
and
numbers
of
individuals
that
are
impinged
or
entrained.

Impingement
sampling.
The
facility
must
collect
samples
to
monitor
impingement
rates
(
simple
enumeration)
for
each
species
over
a
24­
hour
period
and
no
less
than
once
per
month
when
the
cooling
water
intake
structure
is
in
operation.

Entrainment
sampling.
If
the
fixed
facility
does
not
use
a
sea
chest,
it
must
collect
samples
to
monitor
entrainment
rates
(
simple
enumeration)
for
each
species
over
a
24­
hour
period
and
no
less
than
biweekly
during
the
primary
period
of
reproduction,

larval
recruitment,
and
peak
abundance
identified
during
the
Source
Water
Baseline
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
74
Biological
Characterization
required
by
40
CFR
122.21(
r)(
4)
or
the
Comprehensive
Demonstration
Study
required
in
'
125.136(
c)(
2).
Samples
must
be
collected
only
when
the
cooling
water
intake
structure
is
in
operation.

Velocity
monitoring.
If
the
facility
uses
a
surface
intake
screen
system,
it
must
monitor
head
loss
across
the
screens
and
correlate
the
measured
value
with
the
design
intake
velocity.
The
head
loss
across
the
intake
screen
must
be
measured
at
the
minimum
ambient
source
water
surface
elevation
(
using
best
professional
judgment
based
on
available
hydrological
data).
The
maximum
head
loss
across
the
screen
for
each
cooling
water
intake
structure
will
be
used
to
determine
compliance
with
the
velocity
requirement
in
'
125.134(
b)(
2).
If
the
facility
uses
devices
other
than
surface
intake
screens,
it
must
monitor
velocity
at
the
point
of
entry
through
the
device.
Head
loss
or
velocity
would
be
monitored
during
initial
facility
startup,
and
thereafter,
at
the
frequency
specified
in
the
NPDES
permit,
but
no
less
than
once
per
quarter.

To
verify
the
flow
velocity
is
maintained
less
than
0.5
ft/
sec
through
the
cooling
water
intake
structure,
facilities
would
be
required
to
submit
design
specifications
for
the
impingement
control
system
to
the
Director.
Impingement
control
systems
must
be
designed
to
prevent
flow
velocities
from
exceeding
0.5
ft/
second
at
the
maximum
design
flow
of
the
cooling
water
intake
structure.
Facilities
must
monitor
and
record
flow
data
through
the
cooling
water
intake
structure
continuously
to
verify
flows
do
not
exceed
the
maximum
design
flow
for
the
system,
therefore
causing
flow
velocities
to
exceed
0.5
ft/
sec.
As
a
minimum,
facilities
must
summarize
and
provide
flow
data
to
the
Director
on
an
annual
basis
to
verify
flow
rates
through
cooling
water
intake
structure
did
not
exceed
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
75
design
capacity.
Flow
data
can
be
collected
and
submitted
to
the
Director
either
electronically
or
by
hard
copy.

Visual
or
remote
inspections.
The
facility
must
conduct
visual
inspections
or
employ
remote
monitoring
devices
during
the
period
the
cooling
water
intake
structure
is
in
operation.
Visual
inspections
must
be
conducted
at
least
weekly
to
ensure
that
any
design
and
construction
technologies
required
in
'
125.134(
b)(
4),
(
b)(
5),
(
c),
and/
or
(
d)

are
maintained
and
operated
to
ensure
that
they
will
continue
to
function
as
designed.

Alternatively,
the
facility
must
inspect
via
remote
monitoring
devices
to
ensure
that
the
impingement
and
entrainment
technologies
are
functioning
as
designed.

3.
What
Recordkeeping
and
Reporting
is
Required
for
New
Offshore
Oil
and
Gas
Extraction
Fixed
Facilities?

Owners
and
operators
of
new
offshore
oil
and
gas
extraction
fixed
facilities
must
keep
records
of
all
the
data
used
to
complete
the
permit
application
and
show
compliance
with
the
requirements,
any
supplemental
information
developed
under
'
125.136,
and
any
compliance
monitoring
data
submitted
under
'
125.137,
for
a
period
of
at
least
three
years
from
the
date
of
permit
issuance.
The
Director
may
require
that
these
records
be
kept
for
a
longer
period.

Additionally,
this
final
rule
requires
that
new
offshore
oil
and
gas
extraction
fixed
facilities
submit
the
following
in
a
yearly
status
report:

 
Biological
monitoring
records
for
each
cooling
water
intake
structure
as
required
by
'
125.137(
a);
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
76
 
Velocity
and
head
loss
monitoring
records
for
each
cooling
water
intake
structure
as
required
by
'
125.137(
b);
and
 
Records
of
visual
or
remote
inspections
as
required
in
'
125.137(
c).

4.
For
New
Non­
fixed
(
Mobile)
Offshore
Oil
and
Gas
Extraction
Facilities,
What
Information
is
Required
to
be
Collected
for
the
NPDES
Application?

Velocity
Information
(
Track
I)

This
final
rule
requires
that
new
nonfixed
(
mobile)
offshore
oil
and
gas
extraction
facilities
submit
velocity
information
consistent
with
'
125.136(
b)(
1).
The
information
will
be
used
to
demonstrate
to
the
Director
that
the
facility
is
complying
with
the
requirement
to
meet
a
maximum
through­
screen
design
intake
velocity
of
no
more
than
0.5
feet
per
second
at
the
cooling
water
intake
structure.
The
following
information
must
be
submitted:
1)
a
narrative
description
of
the
design,
structure,
equipment,
and
operation
used
to
meet
the
velocity
requirement;
and
2)
design
calculations
showing
that
the
velocity
requirement
would
be
met
at
minimum
ambient
source
water
surface
elevations
(
based
on
best
professional
judgment
using
available
hydrological
data)
and
maximum
head
loss
across
the
screens
or
other
device.

Design
and
Construction
Technology
Plan
(
Track
I)

The
final
rule
requires
that
new
nonfixed
(
mobile)
offshore
oil
and
gas
extraction
facilities
submit
a
design
and
construction
technology
plan
only
when
required
by
the
Director
consistent
with
'
125.134(
b)(
4).
The
design
and
construction
technology
plan
must
demonstrate
that
the
facility
has
selected
and
will
implement
the
design
and
Interagency
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Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
77
construction
technologies
necessary
to
minimize
impingement
mortality
in
accordance
with
'
125.134(
b)(
4).
The
design
and
construction
technology
plan
requires
delineation
of
the
hydrologic
zone
of
influence
for
the
cooling
water
intake
structure;
a
description
of
the
technologies
implemented
(
or
to
be
implemented)
at
the
facility;
the
basis
for
the
selection
of
that
technology;
the
expected
performance
of
the
technology,
and
design
calculations,
drawings
and
estimates
to
support
the
technology
description
and
performance.
The
Agency
recognizes
that
the
selection
of
a
specific
technology
or
a
group
of
technologies
depends
on
the
individual
facility
and
waterbody
conditions.

5.
As
an
Owner
of
Operator
of
a
New
Non­
fixed
(
Mobile)
Offshore
Oil
and
Gas
Extraction
Facility,
What
Monitoring
is
Required?

Biological
monitoring.
Under
this
final
rule,
new
non­
fixed
(
mobile)
offshore
oil
and
gas
extraction
facilities
are
not
required
to
conduct
biological
monitoring
unless
specified
by
the
Director.

Velocity
monitoring.
If
the
mobile
facility
uses
a
surface
intake
screen
system,
it
must
monitor
head
loss
across
the
screens
and
correlate
the
measured
value
with
the
design
intake
velocity.
The
head
loss
across
the
intake
screen
must
be
measured
at
the
minimum
ambient
source
water
surface
elevation
(
using
best
professional
judgment
based
on
available
hydrological
data).
The
maximum
head
loss
across
the
screen
for
each
cooling
water
intake
structure
will
be
used
to
determine
compliance
with
the
velocity
requirement
in
'
125.134(
b)(
2).
If
the
facility
uses
devices
other
than
surface
intake
screens,
it
must
monitor
velocity
at
the
point
of
entry
through
the
device.
Head
loss
or
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
78
velocity
must
be
monitored
during
initial
facility
startup,
and
thereafter,
at
the
frequency
specified
in
the
NPDES
permit,
but
no
less
than
once
per
quarter.

Visual
or
remote
inspections.
The
facility
must
conduct
visual
inspections
or
employ
remote
monitoring
devices
during
the
period
the
cooling
water
intake
structure
is
in
operation.
Visual
inspections
must
be
conducted
at
least
weekly
to
ensure
that
any
design
and
construction
technologies
required
in
'
125.134(
b)(
4),
(
b)(
5),
(
c),
and/
or
(
d)

are
maintained
and
operated
to
ensure
that
they
will
continue
to
function
as
designed.

Alternatively,
the
facility
must
inspect
via
remote
monitoring
devices
to
ensure
that
the
impingement
technologies
are
functioning
as
designed.

6.
What
Recordkeeping
and
Reporting
is
Required
for
New
Non­
fixed
(
Mobile)

Offshore
Oil
and
Gas
Extraction
Facilities?

Owners
and
operators
of
new
mobile
offshore
oil
and
gas
extraction
facilities
must
keep
records
of
all
the
data
used
to
complete
the
permit
application
and
show
compliance
with
the
requirements,
any
supplemental
information
developed
under
'

125.136,
and
any
compliance
monitoring
data
submitted
under
'
125.137,
for
a
period
of
at
least
three
years
from
the
date
of
permit
issuance.
The
Director
may
require
that
these
records
be
kept
for
a
longer
period.

Additionally,
this
final
rule
requires
that
new
mobile
offshore
oil
and
gas
extraction
facilities
submit
the
following
in
a
yearly
status
report:

 
Velocity
and
head
loss
monitoring
records
for
each
cooling
water
intake
structure
as
required
by
'
125.137(
b);
and
 
Records
of
visual
or
remote
inspections
as
required
in
'
125.137(
c).
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
79
D.
Are
Permits
for
New
Offshore
Oil
and
Gas
Extraction
Facilities
Subject
to
Requirements
Under
Other
Federal
Statutes?

EPA=
s
NPDES
permitting
regulations
at
40
CFR
122.49
contain
a
list
of
Federal
laws
that
might
apply
to
Federally
issued
NPDES
permits.
These
include
the
Wild
and
Scenic
Rivers
Act,
16
U.
S.
C.
1273
et
seq.;
the
National
Historic
Preservation
Act
of
1966,
16
U.
S.
C.
470
et
seq.;
the
Endangered
Species
Act,
16
U.
S.
C.
1531
et
seq.;
the
Coastal
Zone
Management
Act,
16
U.
S.
C.
1451
et
seq.;
and
the
National
Environmental
Policy
Act,
42
U.
S.
C.
4321
et
seq.
See
40
CFR
122.49
for
a
brief
description
of
each
of
these
laws.
In
addition,
the
provisions
of
the
Magnuson­
Stevens
Fishery
Conservation
and
Management
Act,
16
U.
S.
C.
1801
et
seq.,
relating
to
essential
fish
habitat
might
be
relevant.
Nothing
in
this
final
rulemaking
authorizes
activities
that
are
not
in
compliance
with
these
or
other
applicable
Federal
laws.
Interagency
Review
Draft­­
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05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
80
IX.
Economic
Impact
Analysis
This
section
summarizes
EPA's
analysis
of
total
social
cost
and
economic
impacts
for
the
316(
b)
Phase
III
final
regulation
for
new
offshore
oil
and
gas
extraction
facilities
and
the
regulatory
options
that
were
considered
for
promulgation
of
a
final
regulation
for
existing
facilities.
EPA's
assessment
of
costs
and
economic
impacts
can
be
found
in
the
Economics
and
Benefits
Analysis.

A.
New
Offshore
Oil
and
Gas
Extraction
Facilities
This
rule
establishes
requirements
for
new
offshore
oil
and
gas
extraction
facilities
that
are
point
sources,
employ
a
cooling
water
intake
structure,
are
designed
to
withdraw
2
MGD
or
more
from
waters
of
the
United
States,
and
use
at
least
25
percent
of
the
water
withdrawn
for
cooling
purposes.
9
Oil
and
gas
extraction
facilities
("
Oil
and
Gas
Facilities")
are
facilities
primarily
engaged
in
oil
and
gas
production
and
drilling
activities.
This
analysis
includes
oil
and
gas
production
platforms/
structures
and
MODUs.
EPA
estimates
that
21
new
oil
and
gas
extraction
platforms
and
103
new
MODUs
would
be
subject
to
the
national
requirements
of
the
rule,
assuming
a
20­
year
period
of
construction
from
2007
(
the
assumed
effective
date
of
the
rule)
to
2026.
Each
newly­
constructed
facility
is
assumed
to
operate
for
30
years,
extending
the
entire
analysis
period
to
49
years
(
2007
to
2055).
Two
methods
of
discounting
over
the
time
period
of
the
analysis
are
employed.
Social
costs
are
discounted
to
2007,
assuming
it
would
take
a
facility
about
6
months
to
begin
incurring
costs.
If
the
start
date
is
actually
later
than
2007,
compliance
costs
will
be
slightly
reduced
from
those
estimated
here
in
9
See
section
II.
B
for
a
definition
of
a
new
offshore
oil
and
gas
extraction
facility
for
the
purposes
of
this
rule.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
81
present
value
terms.
Industry
compliance
costs
are
discounted
for
each
individual
facility
to
the
year
of
compliance
(
the
year
the
vessel
is
launched
or
the
platform/
structure
come
on
line,
which
ranges
from
2007
to
2026).
The
present
value
calculated
for
each
facility
is
then
totaled
to
produce
an
aggregate
present
value
of
compliance
costs.
Annualized
costs
are
then
calculated
by
annualizing
at
a
3
percent
(
social
costs)
or
7
percent
discount
rate
(
social
costs
and
industry
compliance
costs)
over
30
years.
All
dollar
values
presented
in
this
preamble
are
in
$
2004
(
average
or
mid­
year).

1.
General
Approach
for
Costing
Impingement
and
Entrainment
Equipment
for
Offshore
Oil
and
Gas
Extraction
Facilities
EPA's
general
approach
to
estimate
compliance
costs
associated
with
the
use
of
impingement
and
entrainment
controls
for
offshore
oil
and
gas
facilities
was
to
first
identify
the
different
types
of
cooling
water
intake
structures
(
e.
g.,
simple
pipes,
caissons,

sea
chests)
being
employed
by
the
various
types
of
offshore
oil
and
gas
extraction
facilities
(
e.
g.,
jackups,
platforms,
MODUs,
drill
ships).
EPA
then
identified
available
impingement
and
entrainment
control
technologies
(
e.
g.,
cylindrical
wedgewire
systems,

flat
panel
wedgewire
screens)
for
the
different
configurations
of
offshore
oil
and
gas
extraction
facilities
and
cooling
water
intake
structures.
EPA
estimated
both
capital
and
annual
operating
costs
for
each
technology
option
for
the
different
configurations
of
offshore
oil
and
gas
extraction
facilities
and
cooling
water
intake
structures.

In
order
to
estimate
the
related
economic
impacts
associated
with
the
this
final
rule,
EPA
used
the
available
impingement
and
entrainment
control
technologies
with
Interagency
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Draft­­
05/
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06­­
Deliberative:
do
not
cite,
quote
or
distribute
82
superior
reliability
and
performance
(
e.
g.,
technologies
such
as
airburst
cleaning
systems
to
ensure
that
the
through­
screen
intake
velocities
are
relatively
constant
and
as
low
as
possible)
and
ease
of
operation
(
e.
g.,
cooling
water
intake
structures
constructed
with
copper­
nickel
alloy
components
for
biofouling
control).
Consequently,
EPA
is
likely
overestimating
the
actual
incremental
compliance
costs
resulting
from
the
implementation
of
this
final
rule
as
operators
may
choose
less
expensive
impingement
and
entrainment
control
technologies
that
comply
with
the
impingement
and
entrainment
control
performance
standards
in
this
final
rule.
Based
on
these
criteria,
EPA
estimated
the
following
compliance
costs
for
the
various
configurations
of
configurations
of
offshore
oil
and
gas
extraction
facilities
and
cooling
water
intake
structures:

°
Stainless
steel
wedge
wire
screens
with
and
without
air
sparging;

°
Copper­
nickel
wedge
wire
screens
with
and
without
air
sparging;

°
Stainless
steel
velocity
caps;

°
Copper­
nickel
alloy
velocity
caps;

°
Flat
panel
wedge
wire
screens
over
sea
chests;
and
°
Horizontal
flow
diverters
associated
with
sea
chests.

EPA
detailed
methodology
for
estimating
these
compliance
costs
are
outlined
in
the
Technical
Development
Document
and
the
record
supporting
the
final
rule.

2.
Social
Cost
for
New
Oil
and
Gas
Extraction
Facilities
The
total
annualized
social
cost
of
this
rule
for
new
Oil
and
Gas
facilities
is
estimated
at
$
3.8
million
using
a
3
percent
discount
rate,
and
$
3.2
million
using
a
7
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
83
percent
discount
rate.
The
largest
component
of
social
cost
is
the
pre­
tax
cost
of
regulatory
compliance
incurred
by
complying
facilities;
these
costs
include
one­
time
technology
costs
of
complying
with
the
rule,
annual
O&
M
costs,
and
permitting
costs
(
initial
permit
costs,
annual
monitoring
costs,
and
permit
reissuance
costs).
Social
cost
also
includes
implementation
costs
incurred
by
the
Federal
government.
The
final
regulation
would
be
implemented
under
general
permits,
two
in
the
Gulf
of
Mexico,
and
one
in
Cook
Inlet
Alaska.
10
States
are
not
likely
to
be
involved
in
administering
the
permits
for
new
regulated
offshore
oil
and
gas
facilities.
Rather,
general
permits
are
administered
by
the
applicable
EPA
regions
(
Regions
4,
6,
and
10),
even
if
facilities
are
located
in
State
waters.
11
EPA
estimates
that
direct
compliance
costs
would
be
$
3.4
million
and
$
2.8
million,
using
a
3
percent
and
7
percent
discount
rate,
respectively.
The
estimated
Federal
government
cost
for
administering
the
rule
for
new
facilities
is
comparatively
minor
in
relation
to
the
estimated
direct
cost
of
regulatory
compliance.
Federal
administrative
costs
are
estimated
to
be
$
0.4
million
and
$
0.3
million
per
year
under
the
3
percent
and
7
percent
discount
rates,
respectively.

3.
Economic
Impacts
for
New
Oil
and
Gas
Extraction
Facilities
The
following
two
subsections
present
economic
impacts
for
MODUs
and
production
platforms/
structures,
respectively.
Certain
aspects
of
the
methodology
differ
10
Because
individual
permits
are
not
issued,
costs
for
pre­
permitting
and
re­
permitting
studies
are
assumed
to
be
shared
among
groups
of
new
facilities
expected
to
be
covered
by
the
general
permits
(
see
DCN
7­
4036
for
detailed
information
on
how
permitting
costs
are
assumed
to
be
shared
under
the
general
permits).
11
Alaska
does
not
have
NPDES
program
authority
so
EPA
Region
10
writes
NPDES
permits
for
Alaskan
waters.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
84
between
the
two
segments.
Oil
and
gas
production
operations
involve
production
of
a
finite
resource,
which
limits
the
potential
life
of
a
production
platform.
Thus,
the
analysis
for
production
platforms/
structures
must
account
for
the
production
and
resulting
exhaustion
of
the
finite
oil
and
gas
resource.
Key
considerations
in
the
platforms
analysis
are:
(
1)
when
does
production
terminate?
and
(
2)
would
the
year
of
termination
change
due
to
regulation?
The
economic
life
of
a
MODU
is
not
limited
by
such
considerations
and
the
analysis
for
MODUs
is
accordingly
simpler.
The
EA
and
the
rulemaking
record
contain
additional
data
and
details
on
the
methodology
and
assumptions
used
in
these
analyses.

a.
Mobile
Offshore
Drilling
Units
(
MODUs)

EPA
projects
that
80
new
jackups,
20
new
semi­
submersibles,
and
three
new
drill
ships
will
be
constructed
over
the
20
years
for
which
new
facility
additions
are
analyzed.
The
economic
impact
analysis
for
these
new
MODUs
is
conducted
at
two
levels:
the
vessel
level
and
the
firm
level.
EPA
conducted
two
vessel­
level
analyses
and
one
firm­
level
analysis:

 
The
first
vessel­
level
analysis
is
a
closure
analysis,
which
assesses
changes
in
vessel
cash
flow
and
net
income.
Because
the
financial
condition
of
new
vessels
is
unknown,
EPA
used
financial
information
from
representative
existing
vessels,

collected
in
EPA's
316(
b)
survey
of
MODUs
([
DCN
9­
XXXX]),
to
represent
the
financial
characteristics
of
new
facilities.
The
financial
information
from
these
representative
vessels
is
used
for
a
general
assessment
of
how
well
these
vessels
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
85
would
perform
financially
under
the
requirements
of
the
final
regulation.
This
analysis
is
used
as
an
alternative
assessment
of
the
potential
for
a
barrier
to
entry.

 
The
second
vessel­
level
analysis
is
a
standard
barrier­
to­
entry
analysis
for
new
facilities.
This
analysis
computes
the
present
value
of
estimated
initial
permitting
costs,
which
are
assumed
to
be
incurred
over
five
years
prior
to
the
incorporation
of
section
316(
b)
permit
requirements
in
the
applicable
general
permits
(
see
DCN
7­
4036)
and
are
discounted
to
the
year
of
compliance
(
the
year
the
vessel
is
assumed
to
be
launched).
The
one­
time
capital
costs
of
compliance
(
assumed
to
be
incurred
in
the
year
of
compliance)
are
then
added
to
this
figure.
These
summed
compliance
costs
are
then
compared
to
the
baseline
construction
costs
for
each
type
of
MODU.
Neither
recurring
costs
of
compliance
(
e.
g.,
repermitting
costs
or
recurring
capital
costs
of
intake
controls)
nor
recurring
baseline
costs
(
e.
g.,
O&
M,
refitting
costs)
are
considered
in
this
analysis.
The
analysis
compares
baseline
start­
up
costs
and
incremental
start­
up
costs
associated
with
the
final
rule.

 
The
firm­
level
analysis
is
a
cost­
to­
revenue
test
which
compares
the
annualized
compliance
costs
for
representative
new
vessels
to
the
revenue
of
firms
likely
to
construct
MODUs,
assuming
each
of
these
firms
builds
a
share
of
the
103
new
MODUs
expected
to
be
constructed
over
the
20­
year
construction
time
frame.

This
analysis
was
conducted
on
a
pre­
tax
and
after­
tax
basis.

i.
Vessel­
Level
Closure
Analysis
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
86
To
estimate
potential
closures
(
or
more
precisely,
decisions
not
to
proceed
with
constructing
and
placing
a
vessel
into
service)
as
a
result
of
this
rule
for
new
MODUs,

EPA
used
two
models:
(
1)
a
net
income
model,
which
computes
the
estimated
present
value
of
baseline
after­
tax
net
income
(
i.
e.,
without
compliance
costs)
for
representative
MODUs
(
based
on
survey
data
from
existing
MODUs)
over
a
30­
year
operating
period
for
each
new
facility,
12
and
(
2)
an
after­
tax
cost
calculation
model,
which
estimates
the
present
value
of
after­
tax
compliance
costs
using
engineering
and
permitting
cost
inputs.

Comparing
the
results
of
these
two
models
shows
the
potential
effect
of
costs
on
vessel
net
income.

EPA
estimated
after­
tax
net
income
using
data
provided
by
surveyed
operators
of
existing
MODUs
(
EPA
received
economic
surveys
for
three
semi­
submersibles,
three
jackups,
and
two
drill
ships).
EPA
was
only
able
to
undertake
financial
analysis
for
those
MODUs
with
a
positive
net
income
for
the
three
years
of
financial
information
provided
in
the
survey
(
2000
to
2002).
EPA
assumed
that
any
MODU
whose
net
income
is
negative
over
the
three
years
is
unlikely
to
be
a
viable
operation
in
the
baseline
and
cannot
be
analyzed
with
respect
to
compliance
costs.

12
Consistent
with
generally
accepted
methods
of
business
value
analysis,
EPA
would
have
preferred
to
use
the
present
value
of
after­
tax
cash
flow
instead
of
net
income
as
the
basis
for
this
analysis.
However,
because
it
could
not
reliably
estimate
all
of
the
elements
of
cash
flow,
EPA
instead
used
the
present
value
of
net
income
for
its
closure
test.
In
particular,
EPA
was
unable
to
estimate
the
ongoing
capital
outlays
(
apart
from
those
resulting
from
regulatory
compliance)
that
MODUs
would
need
to
make
as
part
of
their
ordinary
business
operations.
In
performing
the
analysis
in
this
way,
EPA
essentially
used
the
facility's
reported
depreciation
and
amortization
 
which,
being
non­
cash
items,
are
normally
excluded
from
cash
flow
accounting
 
as
an
approximation
of
ongoing
capital
outlays.
How
use
of
reported
depreciation
and
amortization,
instead
of
a
reliable
estimate
of
capital
outlays,
affects
the
findings
from
this
analysis
cannot
be
precisely
known.
For
some
businesses
 
in
particular
those
with
relatively
strong
financial
performance
 
depreciation
and
amortization
may
be
less
than
ongoing
capital
outlays;
for
these
businesses,
the
analysis
will
tend
to
overstate
business
value
and
understate
the
potential
effect
of
compliance
outlays
on
financial
performance
and
business
value.
On
the
other
hand,
for
some
businesses
 
in
particular
those
with
relatively
weak
financial
performance
 
depreciation
and
amortization
may
exceed
ongoing
capital
outlays;
for
these
businesses,
the
analysis
will
tend
to
understate
business
value
and
overstate
the
potential
effect
of
compliance
outlays
on
financial
performance
and
business
value.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
87
EPA
used
the
net
income
over
the
three
years
of
survey
data
to
create
a
moving
cycle
of
net
income
over
the
period
of
analysis.
Among
the
years
of
data
collected
(
2000
to
2002),
2002
was
generally
a
poor
year
of
financial
condition
for
the
industry
as
a
whole.
EPA
was
thus
able
to
represent
industry
financials
in
both
good
and
bad
years.

The
three­
year
cycle
simulates
the
effect
of
volatility
in
oil
and
gas
prices
and
other
business
conditions
(
e.
g.,
rig
utilization
rates)
over
each
facility's
30­
year
operating
period.
Future
operating
periods
are
likely
to
include
major
swings
in
the
prices
of
oil
and
gas,
the
driving
force
behind
the
level
of
operations,
rig
pricing,
and,
thus,
financial
performance
of
the
newly
constructed
vessels.
EPA
assumed
that
net
income
will
be
flat,

on
a
three­
year
average
basis,
over
the
30
years
of
analysis
and
thus
did
not
apply
any
factors
to
increase
or
decrease
net
income
over
the
years
of
analysis.
The
net
income
figures
from
the
survey,
therefore,
repeat
every
three
years
for
30
years.
EPA
then
computed
the
present
value
of
that
stream
of
net
income
and
compared
it
to
the
present
value
of
after­
tax
compliance
costs
for
the
final
regulation.

EPA
used
the
estimated
compliance
cost
elements 
capital,
O&
M,
and
permitting
costs 
for
each
new
MODU
to
calculate
the
present
value
of
the
after­
tax
cost
of
compliance
with
this
final
requirements.
Each
compliance­
related
cost
was
accounted
for
in
the
year
it
is
assumed
to
be
incurred.
Tax
effects
of
compliance
outlays
were
based
on
the
owner
company's
marginal
tax
rate
as
determined
from
the
firm's
average
taxable
earnings
over
the
three
years
of
survey
data
(
converted
to
a
mid­
year
2003
basis).
EPA
calculated
depreciation
for
the
compliance
capital
outlay
using
the
modified
accelerated
cost
recovery
system
(
MACRS)
and
included
it
in
the
pre­
tax
compliance
cost
stream.

The
compliance
cost
stream
was
then
reduced
by
the
amount
of
avoided
tax
liability,
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
88
based
on
the
estimated
marginal
tax
rate,
to
yield
the
after­
tax
compliance
cost
stream
(
for
more
information
these
calculations,
see
DCN
7­
4016).
The
final
result
of
these
calculations
is
the
present
value
of
after­
tax
compliance
costs.

The
present
value
of
after­
tax
compliance
costs
was
then
subtracted
from
the
present
value
of
baseline
net
income
for
the
vessel.
If
the
present
value
of
net
income
remained
positive
after
accounting
for
compliance
costs,
EPA
assumed
that
the
MODU
would
operate
post­
compliance.
If
the
present
value
of
net
income
became
negative,

EPA
assumed
that
the
new
MODU
would
not
be
a
financially
viable
project
and
was
counted
as
a
potential
"
regulatory
closure."

The
analysis
is
based
on
the
assumption
that
costs
cannot
be
passed
through
to
customers.
Assuming
zero
cost
pass­
through
may
overestimate
potential
economic
impacts
on
MODUs
because
new
MODUs
will
be
competing
with
existing
MODUs,

which
will
not
incur
compliance
costs.

This
analysis
found
that
no
new
MODUs
(
based
on
an
assumption
that
finances
for
new
MODUs
will
look
like
those
for
existing
MODUs)
would
be
a
regulatory
closure
as
a
result
of
the
incremental
compliance
costs
associated
with
the
final
rule
(
detailed
results
are
provided
in
the
CBI
portion
of
the
record;
DCN
7­
4020;
no
comments
were
received
on
costs
or
analyses,
and
no
new
survey
information
has
been
collected
since
proposal
so
the
analysis
was
not
rerun).

ii.
Vessel­
Level
Barrier­
to­
Entry
Analysis
The
barrier­
to­
entry
analysis
compares
the
present
value
of
compliance
costs
(
including
the
present
value
of
initial
permitting
costs
discounted
to
the
compliance
year
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
89
and
first­
time
capital/
installation
costs,
excluding
recurring
costs),
to
the
costs
of
constructing
a
new
MODU.
If
compliance
costs
comprised
a
small
fraction
of
construction
costs,
EPA
assumed
that
compliance
costs
would
have
no
effect
on
the
decision
to
build
a
new
MODU.

EPA
developed
incremental
compliance
costs
for
new
MODUs
using
estimated
initial
permitting
costs
and
technology
cost
estimates.
The
initial
permitting
costs
are
based
on
each
new
MODU's
share
of
regional
permitting
costs
(
EPA
expects
that
facilities
in
a
particular
geographic
region
would
collect
data
from
representative
facilities
in
that
region)
and
individual
administrative
start­
up
and
permit
application
costs.
The
technology
costs
are
based
on
the
weighted
average
cost
of
installing
controls
at
existing
MODUs,
by
type
of
MODU,
for
all
existing
MODUs
with
technical
data.
The
estimated
present
value
of
the
initial
permitting
cost
stream,
plus
the
first­
time
capital/
installation
costs
of
compliance
costs,
sum
to
approximately
$
130,000
for
semisubmersibles
$
269,000
for
jackups,
and
$
261,000
for
drill
ships.
According
to
Rigzone
(
2006),
the
cost
of
new
MODUs
averages
$
285
million
for
semi­
submersibles,
$
130
million
for
jackups,
and
$
385
million
for
drill
ships
(
DCN
9­
4002).
The
present
value
of
initial
permitting
costs
plus
one­
time
capital/
installation
compliance
costs
is
therefore
estimated
to
range
from
0.03
percent
to
0.21
percent
of
construction
costs
for
the
three
types
of
MODU.
Because
total
up­
front
costs
represent
a
very
small
fraction
of
total
costs
of
construction
(
and
even
of
contingency
costs,
which
typically
range
from
10
percent
to
20
percent
of
capital
costs),
EPA
believes
that
these
costs
would
not
have
a
material
effect
on
decisions
to
build
new
MODUs.
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
90
iii.
Firm­
Level
Cost­
to­
Revenue
Analysis
EPA's
research
showed
that
firms
likeliest
to
build
MODUs
with
a
design
intake
flow
of
2
MGD
or
more
are
those
that
currently
own
such
MODUs.
EPA
identified
nine
firms
owning
jackups,
semi­
submersibles,
or
drill
ships
that
would
be
subject
to
the
requirements
for
new
facilities
if
newly
constructed
or
were
in
the
process
of
building
MODUs
currently.
Most
of
these
firms
are
among
the
largest
firms
in
the
industry..
EPA
estimates
that
these
nine
firms
would
own
the
103
new
MODUs
subject
to
the
final
national
requirements
for
new
facilities.
To
determine
the
potential
impact
of
the
final
rule
on
the
nine
firms
determined
likely
to
build
new
MODUs
subject
to
regulation,
EPA
used
a
cost­
to­
revenue
test,
which
compares
the
annualized
pre­
tax
and
after­
tax
costs
of
compliance
(
calculated
for
representative
new
MODUs),
with
2004
revenue
reported
by
these
firms.
Because
nearly
all
of
the
firms
(
other
than
foreign­
owned)
are
publicly
owned,
EPA
relied
on
revenue
data
compiled
from
corporate
10K
reports
(
see
Chapter
C2
of
the
EA).
EPA
then
assigned
a
number
of
MODUs
potentially
subject
to
regulation
to
each
of
the
firms
and
used
the
average
per­
MODU
compliance
costs
multiplied
by
the
number
of
these
MODUs
to
calculate
the
total
compliance
costs
that
might
be
faced
by
these
firms.

Estimated
total
annual
pre­
tax
compliance
costs
are
approximately
$
15,300
for
a
semi­
submersible,
$
33,800
for
a
jackup,
and
$
39,100
for
a
drill
ship.
Estimated
after­
tax
costs
are
approximately
$
10,000,
$
22,000,
and
$
25,400,
respectively,
based
on
a
35
percent
marginal
corporate
tax
rate
assumption,
which
is
the
highest
marginal
corporate
tax
rate
applicable
(
all
potentially
affected
entities
are
large
or
very
large
corporations
whose
earnings
generally
would
put
them
in
this
tax
bracket).
These
annualized
costs
are
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or
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91
very
small
compared
to
the
revenue
a
MODU
might
receive
for
drilling
even
one
exploratory
well
in
deepwater.
Exploratory
wells
cost
at
least
$
30
million
to
drill,
a
large
portion
of
which
is
paid
to
MODU
operators
(
DCN
7­
4017).
Compliance
costs
are
also
small
compared
to
the
typical
day
rates
(
daily
charges)
paid
to
MODUs
while
drilling
wells.
These
rates
can
range
up
to
$
180,000
per
day
(
DCN
9­
4001).
Seven
firms
are
each
assumed
to
build
9
jackups
or
semi­
submersibles
over
the
time
frame
of
the
analysis
(
approximately
one
MODU
every
other
year).
The
two
additional
firms,
GlobalSantaFe
and
Transocean,
are
the
dominant
firms
in
the
industry.
These
two
firms
are
each
assumed
to
build
18
jackup
or
semi­
submersibles,
plus
one
drill
ship
and
two
drill
ships,

respectively,
over
the
time
frame
of
the
analysis
for
a
total
of
19
or
21
MODUs
in
total.

For
simplicity
and
because
the
majority
of
rigs
anticipated
to
be
constructed
will
be
jackups,
EPA
used
the
higher
compliance
cost
of
a
jackup
rig
to
represent
the
cost
of
compliance
for
both
jackups
and
semi­
submersibles
in
judging
impacts
on
firms.
For
simplicity,
for
a
conservatively
high
estimate
of
compliance
costs
that
a
firm
might
face,

and
to
reflect
the
small
possibility
that
all
a
firm's
new
rigs
might
be
constructed
in
one
year,
EPA
assumed
that
the
annualized
costs
of
compliance
for
all
MODUs
constructed
over
the
period
of
analysis
by
each
firm
are
incurred
in
one
year
for
comparison
to
one
year's
revenue.

Using
these
assumptions,
EPA
estimates
that
the
annualized
pre­
tax
costs
per
firm
range
from
$
0.3
to
$
0.7
million,
and
the
after­
tax
costs
range
from
$
0.2
to
$
0.4
million.

The
pre­
tax
cost­
to­
revenue
ratio
ranges
from
0.01
percent
to
0.2
percent,
while
the
aftertax
ratios
range
from
0.01
percent
to
0.1
percent.
Given
that
the
highest
estimated
ratio
is
0.2
percent,
EPA
concludes
that
firm­
level
impacts
would
not
pose
a
barrier
to
entry.
Interagency
Review
Draft­­
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cite,
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or
distribute
92
b.
Oil
and
Gas
Production
Platforms
EPA
projects
that
20
deepwater
platforms
and
one
Alaska
platform
will
be
constructed
over
the
20
years
over
which
new
facility
additions
are
analyzed.
The
economic
impact
analysis
for
these
new
platforms
is
conducted
at
two
levels:
the
platform
level
and
the
firm
level.
EPA
conducted
two
platform­
level
analyses
and
one
firm­
level
analysis:

 
The
first
platform­
level
analysis
assesses
the
potential
effects
of
compliance
costs
on
platform
operation.
Two
effects
of
the
final
rule
are
considered:
(
1)
a
reduction
in
the
expected
economic
value
of
the
platform,
driven
by
all
costs
of
compliance,
which
could
prevent
oil
and
gas
resources
from
being
brought
into
production,
and
(
2)
earlier
production
shut­
in,
driven
by
the
increase
in
O&
M
costs.
The
baseline
operating
and
financial
profile
for
this
analysis
is
based
on
data
from
existing
platforms
whose
cooling
water
intake
rates
would
cause
them
to
be
subject
to
the
final
rule
if
they
were
being
newly
constructed
after
rule
promulgation.
These
existing
platforms
serve
as
a
baseline
model
of
the
operating
and
financial
conditions
of
new
platforms
that
would
be
regulated
under
the
rule.
Estimated
compliance
costs
are
added
to
the
baseline
cost
profile
in
the
analysis
of
compliance
costs
on
platform
operations.

 
The
second
platform­
level
analysis
is
a
barrier­
to­
entry
analysis
for
new
facilities.

This
analysis
compares
the
present
value
of
estimated
initial
permitting
costs
plus
the
one­
time
capital
costs
of
compliance
(
excluding
any
recurring
costs)
to
the
construction
costs
for
each
type
of
platform.
Interagency
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Draft­­
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cite,
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or
distribute
93
 
The
firm­
level
analysis
is
a
cost­
to­
revenue
test,
which
compares
the
annualized
compliance
costs
for
representative
new
platforms
to
the
revenue
of
firms
likely
to
construct
new
platforms/
structures.
This
analysis
assumes
that
each
firm
likely
to
build
a
deepwater
platform/
structure
subject
to
regulation
would
bring
two
platforms/
structures
on
line
over
the
time
frame
of
the
analysis;
and
that
only
one
firm
will
build
an
Alaska
platform
during
the
analysis
period.
For
simplicity,
to
develop
a
conservatively
high
estimate
of
compliance
costs
in
any
one
year,
and
to
reflect
the
possibility
that
two
structures
could
be
built
in
one
year
by
one
firm,

those
firms
assumed
to
bring
two
deepwater
structures
on
line
are
assigned
the
annualized
costs
of
compliance
for
two
platforms
in
one
year
for
comparison
against
one
year's
revenue.
This
analysis
was
conducted
on
a
pre­
tax
and
aftertax
basis.

i.
Platform­
Level
Production/
Shut­
In
Analysis
Compliance
costs
resulting
from
the
final
regulation
may
affect
a
platform's
financial
performance
and
related
operating
decisions
in
two
ways.
First,
increased
costs
from
regulatory
compliance
will
reduce
the
expected
economic
value
of
an
oil
and
gas
production
project,
and
may
prevent
an
otherwise
financially
viable
project
from
being
undertaken.
Second,
even
if
a
project
overall
remains
financially
viable,
increased
operating
costs
may
lead
to
an
earlier
production
shut­
in
than
would
occur
in
the
baseline.
Details
of
the
analysis
of
these
effects
are
provided
below.

For
the
analysis
of
these
effects,
EPA
constructed
a
general
platform
analysis
model,
which
simulates
the
operations
and
economics
of
oil
and
gas
development
and
Interagency
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or
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94
production.
The
platform
model
analyzes
production
over
a
period
extending
as
long
as
30
years.
Pre­
tax
costs
(
including
costs
incurred
in
pre­
production
years,
O&
M,

monitoring
costs,
and
repermitting
costs)
are
input
into
the
model
in
the
year
in
which
they
occur,
until
the
model
shows
the
platform
is
uneconomical
to
operate.
To
determine
the
shut­
in
year,
projected
net
revenue
is
compared
to
operating
costs
in
each
production
year.
Net
revenue
is
based
on
an
assumed
price
of
oil,
current
and
projected
production
of
oil
and
gas,
well
production
decline
rates,
and
severance
and
royalty
rates.
Operating
costs
are
based
on
a
calculated
cost
per
barrel
of
oil
equivalent
(
BOE)
produced.
The
model
simulates
operations
for
the
lesser
of
30
years
or
to
the
year
when
operating
costs
exceed
production
revenue,
at
which
point
the
operator
is
assumed
to
terminate
production.
The
model
calculates
the
lifetime
of
the
project,
total
production,
and
the
net
present
value
of
the
operation
(
net
income
of
the
operation
over
the
life
of
the
project
in
terms
of
today's
dollars).
A
comparison
of
the
baseline
model
outputs
to
the
postcompliance
model
outputs
yields
any
losses
of
production
and
project
lifetimes
and
the
net
present
value
of
the
operation.
If
the
net
present
value
of
the
operation
is
positive
in
the
baseline
but
negative
post­
compliance,
the
project
is
considered
nonviable
postcompliance
It
is
assumed
the
platform
would
not
be
built.

The
model
uses
as
baseline
data,
financial
information
from
representative
existing
platforms,
collected
in
EPA's
316(
b)
survey
of
production
platforms
([
DCN
9­

XXXX])
to
represent
the
financial
characteristics
of
future
platforms
that
would
be
subject
to
this
final
regulation.
EPA
received
an
economic
survey
from
only
one
deepwater
platform
with
cooling
water
intake
rates
meeting
the
final
regulatory
criteria.

EPA
used
data
from
this
survey
and
from
other
sources
of
publicly
available
information,
Interagency
Review
Draft­­
05/
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06­­
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quote
or
distribute
95
such
as
the
Minerals
Management
Service,
to
develop
a
model
new
deepwater
oil
and
gas
production
platform.
EPA
also
received
a
survey
from
a
platform
in
Alaska
but
did
not
include
it
in
the
analysis
because
the
surveyed
platform
is
a
very
old
structure
and
at
the
end
of
its
productive
life.
It
is
likely
that
it
would
not
be
representative
of
new
platforms
being
built
after
the
Phase
III
rule
is
finalized.
The
Alaska
platform
is
therefore
analyzed
only
in
the
barrier
to
entry
analysis.

Analysis
of
project
viability
As
noted
above,
any
increase
in
costs,
whether
operating,
capital,
or
permitting,

will
reduce
the
expected
economic
value
of
an
oil
and
gas
project,
as
represented
by
the
present
value
of
project
net
income,
and
may
cause
an
otherwise
economic
oil
and
gas
production
project
to
never
be
undertaken.
In
this
case,
the
entire
economic
value
of
the
project
and
its
otherwise
recoverable
oil
and
gas
production
are
assumed
to
be
lost
(
note:

this
loss
need
not
be
permanent
but
may
only
be
delayed
until
higher
product
prices,
or
reduced
development
and
production
costs
allow
the
project
to
become
financially
viable).
For
this
potential
impact,
EPA
analyzed
whether
the
reduction
in
value
from
all
regulatory
compliance
outlays
would
be
sufficient
to
cause
the
expected
discounted
net
income
of
an
otherwise
economically
viable
oil
and
gas
production
project
to
be
negative 
at
the
outset.
In
this
case,
the
operator
is
assumed
not
to
proceed
with
development
and
production.
If
the
platform
has
a
positive
net
present
value
under
baseline
conditions
but
a
negative
net
present
value
in
the
post­
compliance
scenario,
EPA
notes
an
impact
on
the
platform
and
estimates
the
lost
production
resulting
from
the
costs
of
regulatory
compliance.
Interagency
Review
Draft­­
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06­­
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or
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96
Analysis
of
production
shut­
in
effects
Although
a
project
overall
remains
financially
viable,
the
increased
operating
costs
from
regulatory
compliance
may
lead
to
an
earlier
production
shut­
in
than
would
occur
in
the
baseline.
Apart
from
the
financial
impact,
an
earlier
shut­
in
will
also
lead
to
reduced
production
of
otherwise
economically
recoverable
oil
and
gas.
For
this
analysis,

projected
net
revenue
is
compared
to
operating
costs
at
each
year
for
the
model
project.
13
Net
revenue
(
after
subtracting
royalties
and
severance,
which
are
payments
to
the
lease
owner
and
a
State,
if
relevant)
is
based
on
an
assumed
price
of
oil,
current
and
projected
production
of
oil
and
gas,
well
production
decline
rates,
and
severance
and
royalty
rates.

Operating
costs
are
based
on
a
calculated
cost
per
barrel
of
oil
equivalent
(
BOE)

produced.
The
model
simulates
operations
for
the
lesser
of
30
years
or
to
the
year
when
operating
costs
exceed
production
revenue,
at
which
point
the
operator
is
assumed
to
terminate
production.
A
comparison
of
total
production
and
total
project
lifetime
in
the
baseline
vs.
post­
compliance
shows
any
differences
in
these
variables
following
the
imposition
of
compliance
costs.

This
analysis
found
no
impacts
on
deepwater
oil
and
gas
development
or
production
as
a
result
of
the
incremental
compliance
costs
associated
with
this
rule,
for
the
one
platform
that
was
analyzed.
Impacts
on
net
present
value
were
very
small.

(
Detailed
results
are
included
in
the
CBI
portion
of
the
record
at
DCN
7­
4038;
no
13
Following
engineering
review
of
surveyed
deepwater
platforms/
structures,
only
one
was
determined
to
have
a
total
design
cooling
water
intake
structure
intake
flow
rate
meeting
the
proposed
316(
b)
thresholds
for
regulation
of
oil
and
gas
facilities,
had
the
structure
been
newly
constructed,
so
only
one
model
of
deepwater
structures
was
developed.
Interagency
Review
Draft­­
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06­­
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or
distribute
97
substantive
comments
were
received
on
costs
or
the
analysis,
and
no
new
survey
information
was
received
since
proposal,
so
this
analysis
was
not
rerun).

ii.
Platform­
Level
Barrier­
to­
Entry
Analysis
The
barrier­
to­
entry
analysis
compares
the
present
value
of
the
initial
permitting
cost
stream
(
discounted
to
the
year
of
compliance)
plus
one­
time
capital/
installation
costs
to
the
costs
of
constructing
a
new
platform.
If
compliance
costs
comprise
a
small
fraction
of
construction
costs,
EPA
assumes
that
compliance
costs
would
not
have
an
effect
on
the
decision
to
build
a
new
platform.

The
estimated
total
present
values
of
incremental
compliance
costs
are
$
306,323
for
deepwater
projects
and
$
708,058
for
Alaska
projects.
Costs
for
constructing
new
deepwater
platforms
are
estimated
to
range
from
$
114
million
to
$
2.3
billion
(
see
EA
for
the
Synthetic
Drilling
Fluid
Effluent
Limitations
Guidelines
in
the
rulemaking
record,

DCN
7­
4017).
For
Alaska,
EPA
used
a
value
of
$
120
million
(
DCN
7­
4028).
The
ratio
of
incremental
compliance
costs
to
current
total
construction
costs
therefore
ranges
from
0.01
percent
to
0.3
percent
for
deepwater
projects
and
0.6
percent
for
an
Alaska
project.

Because
this
represents
a
small
fraction
of
total
construction
costs
(
and
even
of
contingency
costs),
EPA
believes
that
these
costs
would
not
have
a
material
effect
on
decisions
to
build
new
platforms.

iii.
Firm­
Level
Cost­
to­
Revenue
Analysis
To
determine
the
potential
impact
of
the
final
rule
on
firms,
EPA
used
a
cost­

torevenue
test,
which
compares
the
annualized
pre­
tax
and
after­
tax
costs
of
compliance
Interagency
Review
Draft­­
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05/
06­­
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quote
or
distribute
98
(
calculated
for
a
representative
new
platform
times
the
maximum
number
of
platforms
assumed
built
by
each
firm
in
any
one
year),
with
2004
revenue
reported
by
all
firms
determined
likely
to
be
affected
by
this
regulation.
The
firms
that
are
considered
affected
are
(
1)
those
identified
as
currently
having
existing
deepwater
platforms
or
structures
that
would
be
subject
to
regulation
if
they
were
newly
constructed
and
(
2)
the
likeliest
type
of
firm
to
build
a
new
Alaska
platform
during
the
time
frame
of
the
analysis.
EPA
assumed
each
of
the
11
firms
operating
in
the
deepwater
Gulf
would
bring
on­
line
two
platforms
during
the
period
of
analysis.
For
simplicity,
to
develop
a
conservatively
high
estimate
of
compliance
costs
in
any
one
year,
and
to
reflect
the
possibility
that
two
structures
could
be
built
in
one
year
by
one
firm,
EPA
assumes
the
two
platforms
come
on
line
in
one
year
for
comparison
with
one
year's
revenue
at
each
firm.
One
small
firm
is
assumed
to
build
the
one
Alaska
platform
over
the
period
of
analysis,
and
the
annualized
compliance
cost
is
also
compared
to
one
year's
revenue
at
that
firm.

Using
these
assumptions,
EPA
estimates
that
the
annualized
pre­
tax
costs
per
firm
are
about
$
0.2
million,
and
the
after­
tax
costs
are
about
$
0.1
million.
The
pre­
tax
cost­

torevenue
ratio
ranges
from
<
0.001
percent
to
0.032
percent,
while
the
after­
tax
ratios
range
from
<
0.001
percent
to
0.021
percent.
Given
that
the
highest
estimated
ratio
is
0.032
percent,
EPA
concludes
that
firm­
level
impacts
would
not
pose
a
barrier
to
entry.

c.
Total
Facility
Compliance
Costs
and
Impacts
for
All
New
Oil
and
Gas
Facilities
Exhibit
IX­
1
summarizes
the
total
facility
compliance
costs
and
impacts
associated
with
the
final
regulation
for
Phase
III
new
offshore
oil
and
gas
facilities.
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or
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99
Annualized
after­
tax
costs
total
$
1.9
million
per
year
for
MODUs
and
$
1.3
million
per
year
for
platforms,
or
a
total
of
$
3.2
million
per
year
for
all
affected
new
oil
and
gas
operations
estimated
to
be
constructed
over
the
period
of
the
analysis
(
using
a
7
percent
discount
rate).
14
Exhibit
IX­
1
 
Summary
of
Private
Costs
and
Impacts
for
New
Oil
and
Gas
Facilities
Type
of
Oil
and
Gas
Facility
Number
of
New
Facilities
Annualized
Private
After­
tax
Compliance
Costs
(
in
millions,
$
2004)
Facility
Impacts
Firm
Impacts
MODUs
103
$
1.9
0
0
Platforms
21
$
1.3
0
0
Total
124
$
3.2
0
0
Note:
Component
values
may
not
sum
to
the
reported
total
due
to
independent
rounding.

Exhibit
IX­
2,
below,
summarizes
total
social
costs
and
impacts
for
the
final
regulation
for
new
offshore
oil
and
gas
extraction
facilities.

14
Costs
are
incurred
assuming
20
years
of
new
facility
construction,
with
each
facility
incurring
costs
over
a
30­
year
operating
period,
discounted
to
the
year
the
facility
is
launched
or
comes
on­
line.
The
present
value
of
these
costs
is
calculated,
then
annualized
over
the
30
operating
years
at
7
percent.
The
present
value
of
private
after­
tax
costs
is
less
than
the
previously
described
present
value
of
social
costs,
which
are
based
on
pre­
tax
costs,
because
of
differences
in
the
discounting
for
private
costs
and
social
costs.
Private
costs
are
discounted,
for
each
analysis,
only
to
the
first
year
of
compliance.
In
contrast,
for
the
social
cost
calculation,
all
costs
are
discounted
to
the
beginning
of
2007,
regardless
of
when
new
facilities
come
into
operation.
Because
new
facilities
are
scheduled
to
begin
operation
for
a
20
year
period
following
rule
promulgation,
the
total
effect
of
discounting
is
much
greater
for
the
present
value
of
social
cost
calculation
than
for
the
private
cost
calculation.
As
a
result,
the
present
value
of
social
cost,
even
though
based
on
pretax
costs,
is
less
than
the
present
value
of
private,
after­
tax
cost.
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or
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100
Exhibit
IX­
2
 
Summary
of
Economic
Analysis
for
the
316(
b)
Phase
III
Final
Regulation
Applicable
to
New
Offshore
Oil
and
Gas
Extraction
Facilities
Annualized
Social
Cost
(
in
millions,
$
2004)
1,2
Number
of
Facilities
Subject
to
National
Requirements
Number
of
Facilities
with
Impacts
New
Offshore
Oil
and
Gas
Extraction
Facilities
Direct
Compliance
Cost
for
New
Oil
and
Gas
Facilities
$
3.4
­
$
2.8
124
0
Total
State
and
Federal
Administrative
Cost
$
0.4
­
$
0.3
Total
Social
Cost
$
3.8
­
$
3.2
1
The
left
side
of
the
each
range
is
the
cost
discounted
at
3%
and
the
right
side
is
cost
discounted
at
7%.

2
Numbers
may
not
sum
to
totals
due
to
independent
rounding.

B.
Existing
Phase
III
Facilities
As
described
earlier
in
this
Preamble,
EPA
has
decided
that
Phase
III
facilities
should
continue
to
be
permitted
on
a
case­
by­
case
best
professional
judgment
basis.

Since
we
are
not
promulgating
a
national
section
316(
b)
rule
for
existing
Phase
III
facilities,
there
are
no
additional
compliance
costs
associated
with
this
action
for
these
facilities.
However,
we
did
estimate
the
costs
for
the
national
categorical
regulatory
options
we
considered.
More
information
on
the
costing
analysis
can
be
found
in
the
Development
Document
and
in
the
public
record
for
this
action.

This
part
of
the
Preamble
describes
the
cost
and
economic
impact
analyses
undertaken
for
the
three
principal
regulatory
national
categorical
options
that
were
considered
for
the
Phase
III
final
regulation
for
existing
facilities.
These
three
options
were
defined
by
a
regulatory
applicability
threshold
based
on
design
intake
flow
(
DIF)

and
by
the
type
of
waterbody
from
which
cooling
water
is
withdrawn.
As
described
at
Proposal,
these
regulatory
options
are
as
follows:
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or
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101
1.
Facilities
with
a
total
DIF
of
50
million
gallons
per
day
(
MGD)
or
more
and
located
on
any
source
waterbody
type
(
50
MGD
All
Waterbodies);

2.
Facilities
with
a
total
design
intake
flow
of
200
MGD
or
more
and
located
on
any
source
waterbody
type
(
200
MGD
All
Waterbodies);

3.
Facilities
with
a
total
design
intake
flow
of
100
MGD
or
more
and
located
on
certain
source
waterbody
types
(
i.
e.,
an
ocean,
estuary,
tidal
river/
stream
or
one
of
the
Great
Lakes)
(
100
MGD
coastal/
Great
Lakes).

These
facilities
are
primarily
engaged
in
the
manufacturing
of
paper,
chemicals,

petroleum,
aluminum,
and
steel,
but
include
other
industries
such
food
production
as
well
as
a
few
non­
manufacturing
facilities.
As
described
in
the
NODA,
EPA
now
evaluates
Food
and
Kindred
Products
as
a
primary
industry;
see
Chapter
B2F
of
the
final
EA.

Nonmanufacturing
industries
comprise
less
than
1
percent
of
the
total
facilities
potentially
regulated
under
each
of
the
co­
proposed
options.
In
addition
to
engaging
in
production
activities,
some
facilities
also
generate
electricity
for
their
own
use
and
occasionally
for
sale.

Summary
of
Facilities
Potentially
Subject
to
a
Final
National
Categorical
Phase
III
Regulation
for
Existing
Facilities
Exhibit
IX­
3
presents,
by
DIF
option,
EPA's
estimates
of
(
1)
the
number
of
existing
facilities
potentially
subject
to
this
rulemaking,
(
2)
the
number
of
baseline
closures,
and
(
3)
the
number
of
existing
facilities
subject
to
national
requirements
under
the
proposed
regulations,
after
removal
of
baseline
closures.
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or
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102
Exhibit
IX­
3
 
Phase
III
Existing
Manufacturers
Facility
Counts,
by
DIF
Option
Industry
Facilities
Potentially
Subject
to
Regulation,
Based
on
Applicability
Criteria
Baseline
Closures
Subject
to
National
Requirements,
Excluding
Baseline
Closures
50
MGD
All
Waterbodies
Primary
Man.
Industries
155
14
140
Other
Industries
7
1
6
Total
161
15
146
Total
DIF
(
MGD)
31,215
1,907
29,308
200
MGD
All
Waterbodies
Primary
Man.
Industries
31
1
30
Other
Industries
2
1
1
Total
33
2
31
Total
DIF
(
MGD)
18,973
682
18,292
100
MGD
Coastal/
Great
Lakes
Primary
Man.
Industries
73
5
21
Other
Industries
4
1
2
Total
77
6
23
Total
DIF
(
MGD)
25,328
1,284
24,044
Note:
Totals
may
not
sum
due
to
independent
rounding.

1.
Method
for
Estimating
Costs
to
Manufacturers
Detailed
information
was
not
available
for
the
universe
of
potential
Phase
III
facilities,
and
the
precise
cost
and
performance
of
each
technology
on
a
site­
specific
basis
cannot
be
determined.
Thus,
EPA
developed
model
facility
costs
using
the
methodology
outlined
at
proposal
(
see
69
FR
68498)
and
discussed
in
Chapter
5
of
the
TDD.
EPA
collected
facility­
specific
process
information
using
a
detailed
technical
survey
of
Electric
Generators
and
Manufacturers
(
see
69
FR
68457).
EPA
first
calculated
facilityspecific
costs
for
354
facilities
for
which
detailed
information
was
available,
and
applied
the
model
facility
approach
used
at
proposal
to
the
remaining
facilities
to
calculate
the
industry­
level
costs.

EPA
reasonably
adopted
the
best­
performing
technology
approach
for
estimating
compliance
costs
at
cooling
water
intakes.
EPA
believes
that
this
methodology
is
more
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or
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103
appropriate
than
a
least­
cost
approach.
EPA
recognizes
that
the
actual
technology
and/
or
operational
measures
that
each
facility
might
select
are
based
on
site­
specific
considerations.
In
particular,
it
is
difficult
to
determine
the
precise
performance
of
each
technology
on
a
site­
specific
basis
for
several
hundred
facilities.
The
Agency
thus
selected,
for
the
subset
of
sites
where
multiple
technologies
could
be
considered
to
meet
the
proposed
national
categorical
requirements,
a
best
performing
technology
rather
than
the
least
cost
technology
of
the
choices.
As
articulated
in
the
preamble
to
the
Phase
II
final
rule
(
69
FR
41650),
the
best
performing
technology
concept,
relies
on
assigning
technologies
around
a
median
cost,
with
some
choices
above
and
some
choices
below.

EPA
believes
that
the
best­
performing
technology
approach,
unlike
a
least­
cost
approach,

takes
these
site­
specific
considerations
into
account.
EPA
does
not
have
any
reason
to
believe
that
the
best­
performing
technology
approach
is
inappropriate
to
use
for
existing
facilities
under
Phase
III,
and
it
has
continued
to
rely
upon
it
here.
EPA
notes
that
the
proposal
and
NODA
identified
refinements
made
to
the
methodology,
and
made
it
available
for
public
comment.

In
addition
to
the
capital
and
annual
operating
costs
of
the
selected
technology
module,
some
facilities
were
projected
to
incur
net
downtime
costs.
Downtime
costs
generally
reflect
decreased
revenue
due
to
lost
production
or
costs
of
supplemental
power
purchases
during
the
retrofit
of
existing
cooling
water
intake
structures.
As
described
in
the
NODA
(
70
FR
71057),
EPA's
record
suggests
that
some
manufacturers
have
the
flexibility
to
alter
processes
or
use
other
intakes
to
avoid
downtime,
and
other
manufacturers
may
be
able
to
purchase
power
and
would
experience
a
cost
lower
than
the
cost
of
lost
production.
For
example,
14
percent
of
manufacturing
facilities
operate
less
Interagency
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or
distribute
104
than
75
percent
of
the
year
and
would
likely
avoid
downtime
by
scheduling
installation
of
design
and
construction
technologies
during
this
downtime.
Some
facilities
indicated
they
would
select
engineering
solutions
that
avoid
the
need
for
downtime.
However,

downtime
may
be
unavoidable
at
some
facilities.
For
Phase
III
model
facilities
with
multiple
intakes,
final
downtime
estimates
remain
at
zero
for
those
facilities
with
shoreline
intakes
that
are
not
dedicated
intakes,
as
discussed
in
the
proposal.
Using
the
approach
presented
in
the
NODA,
downtime
estimates
were
reduced
by
49
weeks,
14
weeks,
and
11
weeks,
respectively,
for
the
three
regulatory
options
(
50
MGD
All
Waterbodies,
100
MGD
Coastal/
Great
Lakes,
and
200
MGD
All
Waterbodies,

respectively).
Costs
also
reflect
the
corrected
design
intake
flow
as
described
in
the
NODA.
See
chapter
5,
section
5
of
the
TDD
and
DCN
8­
6601A,
Downtime
Duration
Input
and
Analysis
of
Manufacturing
Facilities,
for
additional
details
on
the
final
downtime
analysis.

Permit
costs,
including
costs
for
permitting,
monitoring,
permit
reissuance,
and
recordkeeping,
are
not
included
in
the
cost­
test
tool.
Costs
for
these
activities
were
developed
separately
as
part
of
the
proposed
Information
Collection
Request
(
ICR)
for
Cooling
Water
Intake
Structures
Phase
III
("
ICR";
DCN
7­
0001).
The
per
facility
permit
costs
were
added
to
the
incremental
compliance
costs,
along
with
installation
downtime
costs
(
where
appropriate),
in
developing
the
total
model
facility
cost.
The
per
facility
permit
costs
may
be
found
in
Chapter
B1
of
the
EA
(
also
see
the
ICR
for
this
rule,
DCN
9­
0001,
for
more
information).
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or
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105
2.
Social
Cost
for
Existing
Manufacturing
Facilities
EPA
calculated
the
social
cost
of
the
principal
regulatory
options
for
existing
manufacturing
facilities
using
two
discount
rate
values:
3
percent
and
7
percent.
All
dollar
values
presented
are
in
$
2004
(
average
or
mid­
year).
For
the
analysis
of
social
costs,
EPA
discounted
all
costs
to
the
beginning
of
2007,
assuming
that
it
would
take
facilities
about
six
months
to
begin
incurring
costs.
EPA
assumed
that
all
facilities
subject
to
the
regulation
would
achieve
compliance
between
2010
and
2014.
EPA
estimated
the
time
profile
of
compliance
and
related
costs
over
30
years
from
the
year
of
compliance
for
each
complying
facility.
15
Costs
incurred
by
governments
for
administering
the
regulation
were
analyzed
over
the
same
time
frame.
The
last
year
for
which
costs
were
tallied
is
2043.
Exhibit
IX­
4
presents
the
total
social
cost.

Exhibit
IX­
4
 
Annualized
Social
Cost1
(
in
millions,
$
2004)

50
MGD
All
Waterbodies
200
MGD
All
Waterbodies
100
MGD
CWB
Direct
Compliance
Cost:

Primary
Manufacturing
Industries
$
36.3
 
37.1
$
18.8
­
$
19.5
$
13.7
­
$
13.3
Other
Industries
$
1.3
 
1.2
$
0.5
­
$
0.4
$
0.7
­
$
0.7
Total
Direct
Compliance
Cost
$
37.6
 
38.3
$
19.3
­
$
20.0
$
14.4
 
$
13.9
State
and
Federal
Administrative
Cost
$
0.6
 
0.6
$
0.2
­
$
0.2
$
0.2
­
$
0.2
Total
Social
Cost
$
38.2
 
39.0
$
19.5
­
$
20.2
$
14.6
­
$
14.1
1
The
left
side
of
the
each
range
is
the
cost
discounted
at
3%,
and
the
right
side
of
each
range
presents
the
cost
with
a
7%
discount
rate.

15
Benefits
are
tallied
and
discounted
in
the
same
way,
although
the
total
time
profile
for
recognition
of
benefits
is
longer
than
the
profile
for
recognition
of
costs.
The
time
profile
of
the
recognition
of
benefits
is
longer
than
that
of
costs
due
to
lag
effects
in
the
population
dynamics
of
species
impacted
by
the
cooling
water
intake
structure.
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or
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106
3.
Economic
Impacts
for
Manufacturers
The
economic
impact
analyses
assess
how
facilities,
and
the
firms
that
own
them,

would
potentially
be
affected
financially
by
the
national
categorical
options.
The
facility
impact
analysis
uses
compliance
cost
estimates
(
see
section
IX.
A.
2)
to
calculate
how
incurrence
of
these
costs
would
affect
financial
performance
and
condition
of
the
regulated
facilities.

This
section
presents
EPA's
estimated
economic
impacts
on
Manufacturers
for
the
national
categorical
regulatory
options
considered
by
EPA.
Impact
measures
include
(
1)
facility
closures
and
associated
losses
in
employment,
(
2)
financial
stress
short
of
closure
("
moderate
impacts"),
and
(
3)
firm­
level
impacts.
EPA
eliminated
from
this
analysis
those
facilities
showing
materially
inadequate
financial
performance
in
the
absence
of
additional
regulation
("
baseline
closures").

For
the
remaining
facilities,
EPA
identified
a
facility
as
a
regulatory
closure
if
it
would
have
operated
under
baseline
conditions
but
would
fall
below
an
acceptable
financial
performance
level
under
additional
regulatory
requirements.
EPA's
analysis
of
regulatory
closures
is
based
on
the
estimated
change
in
facility
after­
tax
cash
flow
and
business
value
as
a
result
of
the
national
categorical
regulatory
options
considered
(
see
EA,
Chapter
B3
for
details
of
the
cash
flow
calculation
and
assessment
of
the
potential
for
facility
closure
as
a
result
of
additional
regulatory
requirements).

EPA's
analysis
of
moderate
financial
impact
is
based
on
change
in
facility
financial
performance
and
condition
as
indicated
by
Interest
Coverage
Ratio
(
ICR)
and
Pre­
Tax
Return
on
Assets
(
PTRA)
(
see
EA
Appendix
B3­
A6
for
details
of
the
moderate
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or
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107
impacts
analysis).
See
EA
for
detailed
description
of
EPA's
baseline
closure
analysis
and
firm
level
analyses.

As
shown
in
Exhibit
IX­
5,
EPA
estimated
that
none
of
the
baseline­
pass
facilities
would
incur
a
severe
impact
(
closure)
or
a
moderate
economic
impact
(
financial
impact
short
of
closure)
under
the
national
categorical
regulatory
options
considered.

Exhibit
IX­
5
 
Summary
of
Cost
and
Regulatory
Impacts
for
Existing
Manufacturing
Facilities
by
Regulatory
Option
50
MGD
All
200
MGD
All
100
MGD
CWB
Facilities
Operating
in
Baseline
144
144
144
Facilities
with
Regulatory
Requirements
144
30
24
Percentage
of
Facilities
with
Regulatory
Requirements
100.0%
20.8%
16.7%

Facilities
Assessed
as
Closures
(
Severe
Impacts)
0
0
0
Percentage
of
Facilities
with
Regulatory
Requirements
Assessed
as
Closures
0.0%
0.0%
0.0%

Facilities
Assessed
as
Moderate
Impacts
0
0
0
Percentage
of
Facilities
with
Regulatory
Requirements
with
Moderate
Impacts
0.0%
0.0%
0.0%

Annualized
Compliance
Costs
(
after
tax,
million
$
2004)
$
26.8
$
11.8
$
12.1
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108
X.
Benefits
Analysis
A.
Introduction
Since
EPA
is
not
promulgating
national
section
316(
b)
requirements
for
existing
Phase
III
facilities,
this
action
will
achieve
no
benefits
with
respect
to
existing
facilities.

However,
EPA
did
estimate
the
benefits
for
the
national
categorical
regulatory
options
considered.
These
benefits
estimates
should
be
compared
only
to
the
cost
estimates
for
these
options
for
existing
Phase
III
facilities.

The
benefit
estimates
presented
below
reflect
impingement
mortality
and
entrainment
reductions
at
Phase
III
existing
facilities
but
not
at
new
offshore
oil
and
gas
extraction
facilities.
EPA
does
not
project
benefits
for
facilities
that
have
not
yet
been
built
because
it
would
require
projecting
where
these
facilities
would
be
built
and/
or
operate.
For
a
comparison
of
social
use
benefits
and
total
social
costs,
refer
to
Section
XI.

B.
Study
Design
and
Methods
The
methodologies
used
here
are
built
upon
those
used
for
estimating
benefits
of
the
final
rule
for
Phase
II
facilities
(
see
FR
69,
41576­
693).
The
national
benefit
estimates
are
derived
from
a
series
of
regional
studies
for
a
range
of
waterbody
types
throughout
the
U.
S.
EPA
evaluated
impingement
and
entrainment
data
from
76
Phase
II
facilities
and
20
potentially
regulated
Phase
III
facilities.
16
Using
standard
fishery
modeling
techniques,
EPA
combined
facility­
derived
impingement
and
entrainment
counts
with
16
"
Potentially
regulated
Phase
III
facilities"
refers
to
all
existing
facilities
with
design
intake
flows
greater
than
2
MGD
and
not
regulated
under
the
Phase
II
rule.
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or
distribute
109
relevant
life
history
data
to
derive
estimates
of
(
1)
age­
one
equivalent
losses
(
the
number
of
individuals
of
different
ages
impinged
and
entrained
expressed
as
an
equivalent
number
of
age­
one
fish),
and
(
2)
foregone
fishery
yield
(
pounds
of
commercial
harvest
and
numbers
of
recreational
fish
and
shellfish
not
harvested
due
to
impingement
and
entrainment).
Of
the
organisms
that
were
anticipated
to
be
protected
by
the
national
categorical
analysis
option,
approximately
2
to
3
percent
would
have
been
eventually
harvested
by
commercial
and
recreational
fishers
and
therefore
can
be
valued
with
direct
use
valuation
techniques.

To
obtain
a
national
estimate
of
losses
at
all
potentially
regulated
facilities,
EPA
extrapolated
impingement
and
entrainment
rates
from
facilities
with
data
(
model
facilities)
to
facilities
without
data,
on
the
basis
of
operational
intake
flow
in
millions
of
gallons
per
day
(
MGD).
Exhibit
X­
1
presents
EPA's
estimates
of
current
annual
impingement
and
entrainment
(
I&
E)
and
EPA's
estimates
of
annual
I&
E
reductions
under
the
national
categorical
regulatory
options.

Exhibit
X­
1
 
Annual
Impingement
and
Entrainmenta
Baseline
Losses
and
Estimated
Reductions
under
the
National
Categorical
Regulatory
Options
Age­
1
Equivalent
Fish
Foregone
Fishery
Yield
(
lbs)
Baseline
265,000,000
9,640,000
50
MGD
All
Option
98,200,000
4,770,000
200
MGD
All
Option
74,500,000
3,290,000
100
MGD
CWB
Option
71,100,000
4,510,000
a.
I&
E
data
are
rounded
to
three
significant
figures.
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or
distribute
110
C.
National
Benefits
Economic
benefits
of
the
national
categorical
regulatory
options
for
the
section
316(
b)
regulation
for
Phase
III
existing
facilities
can
be
defined
according
to
categories
of
goods
and
services
provided
by
the
species
affected
by
impingement
and
entrainment
by
cooling
water
intake
structures.

The
first
category
includes
benefits
that
pertain
to
the
use
(
direct
or
indirect)
of
the
affected
fishery
resources.
Use
value
reflects
the
value
of
all
current
direct
and
indirect
uses
of
a
good
or
service
such
as
commercial
and
recreational
harvest
of
fish
(
Mitchell
and
Carson,
1989,
DCN
5­
1287).
In
this
context,
direct
use
values
are
associated
with
harvested
fish,
while
indirect
use
values
are
associated
with
nonharvested
fish
that
are
prey
for
harvested
fish.
The
second
category
includes
benefits
that
are
independent
of
any
current
or
anticipated
use
of
the
resource;
these
are
known
as
"
non­
use"
or
"
passive
use"
values.
Non­
use
values
include
"
nonmarketed"
goods
and
services,
which
reflect
human
values
associated
with
existence,
bequest,
and
altruistic
motives.

EPA
estimated
the
economic
benefits
from
the
national
categorical
regulatory
options
using
a
range
of
valuation
methods,
depending
on
the
benefit
category,
data
availability,
and
other
suitable
factors.
EPA
calculated
benefits
of
the
national
categorical
regulatory
options
for
existing
Phase
III
facilities
using
two
discount
rate
values:
3
percent
and
7
percent.
All
dollar
values
presented
are
in
$
2004
(
average
or
mid­
year).
Because
avoided
fish
deaths
occur
mainly
in
fish
that
are
younger
than
harvestable
age
(
eggs,
larvae
and
juveniles),
the
benefits
from
avoided
impingement
and
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or
distribute
111
entrainment
would
be
realized
typically
3­
4
years
after
their
avoided
death.
A
detailed
description
of
the
approaches
used
can
be
found
in
the
Regional
Analysis
Document.

1.
Use
Benefits
To
estimate
recreational
benefits
of
the
national
categorical
regulatory
options,

EPA
developed
a
benefit
transfer
approach
based
on
a
meta­
analysis
of
recreational
fishing
valuation
studies
designed
to
measure
the
various
factors
that
determine
willingness­
to­
pay
for
catching
an
additional
fish
per
trip.
To
estimate
the
benefits,
EPA
multiplied
the
per
fish
values
by
the
number
of
additional
fish
that
would
be
caught
by
anglers
under
the
national
categorical
regulatory
options
due
to
reductions
in
impingement
and
entrainment,
compared
to
current
levels
of
recreational
catch.
To
estimate
commercial
fishing
benefits,
EPA
monetized
the
reduction
in
forgone
fishery
yield
using
market
prices,
since
the
reduction
in
forgone
yield
has
an
insignificant
impact
on
prices.

2.
Non­
use
Benefits
To
assess
the
public
policy
significance
of
the
ecological
gains
from
the
national
categorical
regulatory
options
for
Phase
III
facilities,
EPA
also
attempted
to
quantify
nonuse
benefits
associated
with
reduction
in
impingement
and
entrainment
of
fish,

shellfish,
and
other
aquatic
organisms
under
the
national
categorical
regulatory
options,

but
was
unable
to
do
so
in
time
to
meet
the
consent
decree
deadline.
EPA
also
conducted
a
break­
even
analysis
of
non­
use
benefits
(
see
the
Regional
Analysis
Document
for
details).
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Review
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or
distribute
112
3.
National
Benefits
This
section
presents
EPA's
estimated
benefits
of
the
national
categorical
regulatory
options
considered
by
EPA's
final
regulation
for
Phase
III
existing
facilities.

Since
the
Agency
was
unable
to
monetize
non­
use
benefits,
the
monetized
estimates
of
total
benefits
reflect
use
values
only.
National
use
benefit
estimates
(
see
Exhibit
X­
2)
are
subject
to
uncertainties
inherent
in
valuation
approaches
used
for
assessing
the
benefits
categories.
The
combined
effect
of
these
uncertainties
is
of
unknown
magnitude
or
direction
(
i.
e.,
the
estimates
may
over­
or
under­
state
the
anticipated
national­
level
benefits);
however,
EPA
has
no
data
to
indicate
that
the
results
for
each
benefit
category
are
atypical
or
unreasonable.

Exhibit
X­
2
 
Summary
of
Monetized
Social
Use
Benefits
Under
the
National
Categorical
Regulatory
Options
(
Thousands,
$
2004)
a
Option
Annualized
Commercial
Fishing
Benefits
Annualized
Recreational
Fishing
Benefits
Total
Annualized
Value
of
Monetizable
Impingement
and
Entrainment
Reductionsb
50
MGD
All
$
255
­
$
321
$
1,543
­
$
1,931
$
1,798
­
$
2,251
200
MGD
All
$
167
­
$
211
$
1,027
­
$
1,288
$
1,194
­
$
1,499
100
MGD
CWB
$
244
­
$
308
$
1,244
­
$
1,564
$
1,489
­
$
1,872
a
All
benefits
presented
in
this
table
are
annualized.
These
annualized
benefits
represent
the
value
of
all
benefits
generated
over
the
time
frame
of
the
analysis,
discounted
to
2007,
and
then
annualized
over
a
thirty
year
period.
For
a
more
detailed
discussion
of
the
discounting
methodology,
refer
to
section
X.
D.
2
of
this
preamble.
The
low
end
of
these
ranges
is
based
on
the
value
of
benefits
discounted
using
a
7%
discount
rate
while
the
high
end
is
based
on
the
value
of
benefits
discounted
using
a
3%
discount
rate.
b
The
estimate
of
the
total
monetizable
value
of
impingement
and
entrainment
reductions
includes
use
benefits
only.
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113
XI.
Comparison
of
Benefits
and
Costs
Since
EPA
is
not
promulgating
national
section
316(
b)
requirements
for
existing
Phase
III
facilities,
there
are
no
benefits
or
compliance
costs
for
existing
facilities
from
this
action.
However,
EPA
did
estimate
the
benefits
and
costs
for
the
regulatory
options
considered
for
existing
facilities.
You
can
find
more
information
on
these
benefit
and
cost
analyses
in
the
Economic
and
Benefits
Analysis,
Regional
Analysis
Document,
and
in
the
public
record
for
this
action.

EPA
does
not
project
benefits
for
facilities
that
have
not
yet
been
built
because
it
would
require
projecting
where
these
facilities
would
be
built
and/
or
operate;
thus
there
are
no
benefits
estimates
for
new
offshore
oil
and
gas
extraction
facilities.
Hence
it
is
not
possible
to
compare
the
costs
and
benefits
associated
with
this
action.

This
section
presents
comparisons
of
the
benefits
and
costs
of
the
primary
analysis
options
by
study
region.
The
benefit­
cost
analysis
for
the
primary
analysis
options
compares
total
annualized
use
benefits
to
total
annualized
pre­
tax
costs
(
social
costs)
at
existing
facilities
that
remain
open
in
the
baseline.
Benefits
and
costs
were
discounted
using
both
a
3
percent
and
7
percent
discount
rate.
The
cost
estimates
include
costs
of
compliance
to
facilities
subject
to
the
final
rule
as
well
as
administrative
costs
incurred
by
state
and
local
governments
and
by
the
federal
government.
These
cost
categories
are
consistent
with
those
typically
considered
in
technology­
based
rulemakings.
The
benefits
estimates
include
monetized
benefits
to
commercial
and
recreational
fishing.
The
total
monetizable
benefits
include
only
use
benefits.
The
nonuse
benefits
were
evaluated
qualitatively.
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114
Exhibit
XI­
1
summarizes
total
annualized
use
benefits,
total
annualized
costs,
and
net
benefits
for
the
primary
analysis
options.

Exhibit
XI­
1
 
Summary
of
Social
Benefits
and
Costs
for
the
Primary
Analysis
Options
(
Millions;
$
2004)

Option
Number
of
Facilities
Subject
to
Option
Number
of
Facilities
Installing
Technology
Total
Annualized
Use
Value
of
I&
E
Reductionsa
Total
Annualized
Costsb
Net
Benefits
50
MGD
All
Waterbodies
146
111
$
1.80
­
$
2.25
$
38.27
­
$
39.00
$­
36.5
­
$­
36.7
200
MGD
All
Waterbodies
31
27
$
1.19
­
$
1.5
$
19.48
­
$
20.14
$­
18.3
­
$­
18.6
100
MGD
Coastal
/
Great
Lakes
23
22
$
1.49
­
$
1.87
$
14.57
­
$
14.11
$­
13.1
­
$­
12.2
a
The
total
monetizable
value
of
I&
E
reductions
includes
use
benefits
only.
EPA
evaluated
non­
use
benefits
only
qualitatively.
The
low
and
high
use
values
reflect
the
range
of
benefits
values
presented
in
Section
X
of
the
preamble.
b
Total
costs
are
based
on
pre­
tax
facility
costs.
National
total
costs
also
include
State,
local,
and
Federal
administrative
costs
of
$
0.6
million
that
cannot
be
attributed
to
individual
study
regions.
The
low
and
high
cost
values
reflect
the
range
of
cost
values
presented
in
Section
IX
of
the
preamble.
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115
XII.
Statutory
and
Executive
Order
Reviews
The
discussion
of
the
regulatory
statutes
and
Executive
Orders
in
this
section
addresses
requirements
relevant
to
new
offshore
oil
and
gas
extraction
facilities.
As
discussed
in
section
VI
of
this
preamble,
EPA
has
decided
not
to
promulgate
national
categorical
standards
for
Phase
III
existing
facilities.

A.
Executive
Order
12866:
Regulatory
Planning
and
Review
Under
Executive
Order
12866,
(
58
Federal
Register
51735
(
October
4,
1993))
the
Agency
must
determine
whether
the
regulatory
action
is
"
significant"
and
therefore
subject
to
OMB
review
and
the
requirements
of
the
Executive
Order.
The
Order
defines
"
significant
regulatory
action"
as
one
that
is
likely
to
result
in
a
rule
that
may:

 
Have
an
annual
effect
on
the
economy
of
$
100
million
or
more
or
adversely
affect
in
a
material
way
the
economy,
a
sector
of
the
economy,
productivity,

competition,
jobs,
the
environment,
public
health
or
safety,
or
State,
local,
or
tribal
governments
or
communities;

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

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

Pursuant
to
the
terms
of
Executive
Order
12866,
it
has
been
determined
that
this
rule
is
a
"
significant
regulatory
action"
because
the
rule
raises
novel
policy
issues
arising
Interagency
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cite,
quote
or
distribute
116
out
of
the
President's
priorities.
As
such,
this
action
was
submitted
to
OMB
for
review.

Changes
made
in
response
to
OMB
suggestions
or
recommendations
will
be
documented
in
the
public
record.

B.
Paperwork
Reduction
Act
The
Office
of
Management
and
Budget
(
OMB)
has
approved
the
information
collection
requirements
contained
in
this
rule
under
the
provisions
of
the
Paperwork
Reduction
Act,
44
U.
S.
C.
3501
et
seq.
and
has
assigned
[
OMB
control
number
20XXXXXX

The
information
collected
under
this
final
rule
would
assist
EPA
in
regulating
environmental
impacts,
namely
impingement
mortality
and
entrainment,
at
cooling
water
intake
structures
at
new
offshore
oil
and
gas
extraction
facilities.
This
information
would
be
used
by
these
facilities
as
appropriate
to
prepare
permit
applications,
comprehensive
demonstration
studies,
monitor
impingement
mortality
and
entrainment,
verify
compliance,
and
prepare
annual
reports
as
required
under
this
rule.
The
information
collected
would
be
reviewed
by
EPA
to
ensure
that
appropriate
National
Pollutant
Discharge
Elimination
System
(
NPDES)
permit
conditions
regulating
cooling
water
intake
structures
would
be
developed.
Compliance
with
the
applicable
information
collection
requirements
imposed
under
this
final
rule
is
mandatory
(
see
''
122.21(
r),

125.136,
125.137,
125.138).

EPA
does
not
consider
the
specific
data
that
would
be
collected
under
this
final
rule
to
be
confidential
business
information.
However,
if
a
respondent
does
consider
this
information
to
be
confidential,
the
respondent
may
request
that
such
information
be
Interagency
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Draft­­
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cite,
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or
distribute
117
treated
as
confidential.
All
confidential
data
submitted
to
EPA
will
be
handled
in
accordance
with
40
CFR
122.7,
40
CFR
Part
2,
and
EPA=
s
Security
Manual
Part
III,

Chapter
9,
dated
August
9,
1976.

This
final
rule
modifies
regulations
at
'
122.21
to
require
new
offshore
oil
and
gas
extraction
facilities
to
prepare
and
submit
information
consistent
with
that
required
for
Phase
I
facilities
(
the
requirements
vary
based
on
whether
the
facility
a
"
fixed"

facility
and
whether
it
uses
a
sea
chest).
A
detailed
list
of
required
data
items
is
provided
below.

The
total
average
annual
burden
of
the
information
collection
requirements
for
new
offshore
oil
and
gas
facilities
associated
with
this
final
rule
is
estimated
at
11,238
hours
for
an
average
of
22
facilities.
Hence,
the
annual
average
reporting
and
recordkeeping
burden
for
the
collection
of
information
by
facilities
responding
to
the
final
rule
is
estimated
to
be
511
hours
per
respondent.

For
new
offshore
oil
and
gas
extraction
facilities,
the
permitting
process
is
handled
directly
by
EPA
Regions.
Because
this
burden
is
incurred
by
the
Federal
Government
rather
than
the
States,
it
is
not
included
as
part
of
the
burden
statement
for
State
Directors.
Hence,
there
will
be
no
increase
in
the
Director
reporting
and
recordkeeping
burden
for
the
review,
oversight,
and
administration
of
the
rule.

The
corresponding
estimates
of
average
annual
cost
other
than
labor
(
labor
and
non­
labor
costs
are
included
in
the
total
cost
of
the
final
rule
discussed
in
section
IX
of
this
preamble)
is
$
0.58
million
for
31
new
offshore
oil
and
gas
facilities
during
the
first
three
years
after
promulgation
of
the
rule.
Non­
labor
costs
include
activities
such
as
capital
costs
for
remote
monitoring
devices,
laboratory
services,
photocopying,
and
the
Interagency
Review
Draft­­
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06­­
Deliberative:
do
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cite,
quote
or
distribute
118
purchase
of
supplies.
The
burden
and
costs
are
for
the
information
collection,
reporting,

and
recordkeeping
requirements
for
the
three­
year
period
beginning
with
the
assumed
effective
date
of
this
rule.
Additional
information
collection
requirements
will
occur
after
this
initial
three­
year
period
as
new
offshore
oil
and
gas
extraction
facilities
are
issued
permits
and
such
requirements
will
be
counted
in
a
subsequent
information
collection
request.

Studies
to
be
submitted
by
new
offshore
oil
and
gas
extraction
facilities
under
this
final
rule
are
listed
below.
New
offshore
oil
and
gas
fixed
platforms
would
be
required
to
collect
the
general
information
listed
below.

 
Source
Water
Physical
Data
('
122.21(
r)(
2))
('
122.21(
r)(
2)(
iv)
only
for
nonfixed
new
offshore
oil
and
gas
extraction
facilities)

 
Cooling
Water
Intake
Structure
Data
('
122.21(
r)(
3))
('
122.21(
r)(
3)(
ii)
not
applicable
to
non­
fixed
new
offshore
oil
and
gas
extraction
facilities)

New
offshore
oil
and
gas
extraction
facilities
would
be
required
to
submit
the
following
information
under
Track
I:

 
Source
Water
Baseline
Biological
Characterization
Data
('
122.21(
r)(
4))
(
not
required
for
non­
fixed
facilities)

 
Velocity
Information
('
125.136(
b)(
1))

 
Source
Waterbody
Flow
Information
('
125.136(
b)(
2))
(
not
required
for
nonfixed
facilities)

 
Design
and
Construction
Technology
Plan
('
125.136(
b)(
3))
Interagency
Review
Draft­­
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06­­
Deliberative:
do
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cite,
quote
or
distribute
119
Under
Track
II,
new
offshore
oil
and
gas
extraction
facilities
would
be
required
to
submit
the
following
information:

 
Source
Waterbody
Flow
Information
('
125.136(
c)(
1))

 
Comprehensive
Demonstration
Study
('
125.136(
c)(
2))

o
Source
Water
Biological
Study
('
125.136(
c)(
2)(
iii)(
A))

o
Evaluation
of
Potential
Cooling
Water
Intake
Structure
Effects
('

125.136(
c)(
2)(
iii)(
B))

o
Verification
Monitoring
Plan
('
125.136(
c)(
2)(
iii)(
C))

In
addition
to
the
information
requirements
of
the
permit
renewal
application,

NPDES
permits
normally
specify
monitoring
and
reporting
requirements
to
be
met
by
the
permitted
entity.
New
offshore
oil
and
gas
extraction
fixed
facilities
would
be
required
to
perform
monitoring
as
determined
by
the
Track
I
or
Track
II
requirements
in
'
125.136
and
in
accordance
with
'
125.137.
Additional
ambient
water
quality
monitoring
may
also
be
required
of
facilities
depending
on
the
specifications
of
their
permits
(
e.
g.,
as
part
of
velocity
monitoring
at
'
125.137(
b)).
New
offshore
oil
and
gas
extraction
facilities
would
be
expected
to
analyze
the
results
from
their
monitoring
efforts
and
are
required
to
provide
these
results
in
an
annual
status
report
to
the
permitting
authority.
Finally,

facilities
would
be
required
to
maintain
records
of
all
submitted
documents,
supporting
materials,
and
monitoring
results
for
at
least
three
years.

All
impacted
facilities
would
carry
out
the
specific
activities
necessary
to
fulfill
the
general
information
collection
requirements.
The
estimated
burden
includes
developing
a
water
balance
diagram
that
can
be
used
to
identify
the
proportion
of
intake
water
used
for
cooling,
make­
up,
and
process
water.
Facilities
would
also
gather
data
to
Interagency
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06­­
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cite,
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or
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120
calculate
the
reduction
in
impingement
mortality
and
entrainment
of
all
life
stages
of
fish
and
shellfish
that
would
be
achieved
by
the
technologies
and
operational
measures
they
select.
The
burden
estimates
include
sampling,
assessing
the
source
waterbody,

estimating
the
magnitude
of
impingement
mortality
and
entrainment,
and
reporting
results
in
a
comprehensive
demonstration
study.
The
burden
may
also
include
conducting
a
pilot
study
to
evaluate
the
suitability
of
the
technologies
and
operational
measures
based
on
the
species
that
are
found
at
the
site.

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.
In
addition,
EPA
is
amending
the
table
in
40
CFR
part
9
of
currently
approved
OMB
control
numbers
for
various
regulations
to
list
the
regulatory
citations
for
the
information
requirements
contained
in
this
final
rule.
Interagency
Review
Draft­­
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06­­
Deliberative:
do
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cite,
quote
or
distribute
121
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.
This
section
summarizes
EPA's
analyses
in
compliance
with
the
RFA.

1.
Definition
of
Small
Entity
Small
entities
include
small
businesses,
small
organizations,
and
small
governmental
jurisdictions.
For
assessing
the
impacts
of
this
rule
on
small
entities,
a
small
entity
is
defined
as:
(
1)
a
small
business
as
defined
by
the
Small
Business
Administration's
(
SBA)
regulations
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

forprofit
enterprise
which
is
independently
owned
and
operated
and
is
not
dominant
in
its
field.

The
SBA
small
business
size
standards
changed
from
a
SIC
code­
based
system
to
a
NAICS
code­
based
system
on
October
1,
2000.
The
SBA
revised
the
size
standards
upwards
effective
January
5,
2006.
Since
EPA
conducted
its
data
collection
effort
for
existing
facilities
before
these
changes,
EPA
performed
the
small
entity
analysis
for
existing
facilities
based
on
SIC
codes.
EPA
then
conducted
a
subsequent
analysis
to
determine
if
the
size
standards
based
on
the
revised
NAICS
codes
would
have
any
effect
on
the
results
of
the
small
entity
analysis.
To
be
conservative,
for
those
SIC
codes
that
Interagency
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or
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122
are
associated
with
more
than
one
NAICS
code,
the
highest
threshold
of
the
associated
NAICS
codes
was
used
as
the
threshold
for
the
SIC
code
(
e.
g.,
if
an
SIC
was
associated
with
two
NAICS
codes,
one
with
a
small
business
threshold
of
500
employees
and
one
with
a
small
business
threshold
of
750
employees,
the
SIC
code
was
assigned
a
small
business
threshold
of
750
employees,
the
higher
of
the
associated
NAICS).
This
process
ensured
that
at
least
all
small
entities
would
be
captured,
but
could
potentially
overstate
the
total
number
of
small
entities.
This
analysis
showed
there
would
be
no
changes
to
the
small
entity
determination,
and
therefore
to
small
entity
impacts,
as
a
result
of
switching
from
SIC­
based
size
standards
to
NAICS­
based
size
standards.

2.
Certification
Statement
After
considering
the
economic
impacts
of
this
rule
on
small
entities,
I
certify
that
this
action
will
not
have
a
significant
economic
impact
on
a
substantial
number
of
small
entities.
This
regulation
applies
to
new
offshore
oil
and
gas
extraction
facilities
that
withdraw
2
MGD
or
more
from
waters
of
the
United
States.

3.
Statement
of
Basis
From
its
analysis,
EPA
estimates
that
the
final
rule
will
apply
national
standards
to
only
one
small
entity,
a
new
offshore
oil
and
gas
platform.
EPA
estimates
this
entity
will
incur
annualized,
after­
tax
compliance
costs
of
less
than
0.1
percent
of
annual
revenue.
EPA
does
not
know
precisely
which
firms
will
undertake
construction
of
new
offshore
oil
and
gas
extraction
facilities.
However,
based
on
the
firms
that
are
currently
active
in
building
the
types
of
facilities
representative
of
those
covered
by
the
rulemaking,
EPA
believes
that
the
small
firm
analyzed
represents
the
smallest
firm
that
will
be
involved
in
such
activities
over
the
period
of
the
analysis.
Interagency
Review
Draft­­
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06­­
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do
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or
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123
4.
Summary
of
Small
Business
Advocacy
Review
Panel
As
described
at
Proposal,
although
not
required
by
the
RFA,
EPA
convened
a
Small
Business
Advocacy
Review
(
SBAR)
Panel
to
obtain
advice
and
recommendations
from
small
entity
representatives
(
SERs)
during
development
of
the
proposed
regulation.

A
summary
of
EPA's
small
entity
outreach
and
information
on
the
composition,
process,

and
findings
of
the
SBAR
panel
can
be
found
in
the
preamble
of
the
Proposal.
As
noted
above,
only
one
small
entity
is
estimated
to
be
subject
to
national
standards
under
this
final
regulation.

5.
Small
Entity
Flexibility
Analysis
Despite
the
determination
that
this
rule
will
not
have
a
significant
economic
impact
on
a
substantial
number
of
small
entities,
EPA
prepared
at
Proposal,
and
updated
its
analysis
for
the
final
regulation,
a
Small
Entity
Flexibility
Analysis
that
has
all
the
components
of
a
Final
Regulatory
Flexibility
Analysis
(
FRFA).
A
FRFA
examines
the
impact
of
a
rule
on
small
entities
along
with
regulatory
alternatives
that
could
reduce
that
impact.
The
Small
Entity
Flexibility
Analysis
(
which
is
described
in
detail
in
the
Economic
Analysis
document)
is
available
for
review
in
the
docket.

Under
the
final
regulation,
EPA
estimates
that
only
one
small
entity
(
a
new
offshore
oil
and
gas
facility)
will
be
subject
to
the
national
categorical
requirements.
The
one
new
offshore
oil
and
gas
facility
potentially
affected
by
the
final
rule
is
estimated
to
have
a
cost­
to­
revenue
ratio
of
less
than
0.1
percent.
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or
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124
D.
Unfunded
Mandates
Reform
Act
Title
II
of
the
Unfunded
Mandates
Reform
Act
of
1995
(
UMRA),
P.
L.
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
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
why
that
alternative
was
not
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
intergovernmental
mandates,
and
informing,
educating,
and
advising
small
governments
on
compliance
with
regulatory
requirements.
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or
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125
From
its
analysis
for
the
final
regulation,
EPA
estimates
the
total
annualized
aftertax
costs
of
compliance
to
be
$
1.9
million
($
2004).
All
of
these
direct
facility
costs
are
incurred
by
the
private
sector
(
124
oil
and
gas
facilities).
No
facility
owned
by
State
or
local
governments
is
subject
to
the
national
requirements
under
the
final
rule.

Additionally,
permitting
authorities
will
not
incur
costs
to
administer
the
rule
for
new
offshore
oil
and
gas
extraction
facilities
because
these
facilities
are
not
under
State
jurisdiction.
As
required
by
UMRA
section
202,
EPA
estimates
that
the
highest
undiscounted
after­
tax
cost
incurred
by
the
private
sector
in
any
one
year
is
approximately
$
1.5
million
in
2013.

From
this
analysis,
EPA
determined
that
this
rule
does
not
contain
a
Federal
mandate
that
would
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.
(
See
Economic
Analysis,
Chapter
D2:
UMRA
Analysis,
for
more
detailed
information.)
At
proposal,
when
including
the
potential
costs
of
the
national
categorical
rule
options,
EPA
determined
that
the
proposal
may
have
resulted
in
expenditures
of
$
100
million
or
more
for
State,
local,
or
Tribal
governments,
in
the
aggregate,
or
the
private
sector
in
any
one
year
(
69
FR
68539).
Since
EPA
has
chosen
to
continue
to
rely
upon
the
permitting
authority's
best
professional
judgment
to
establish
section
316(
b)
limits
for
existing
facilities
not
covered
by
the
Phase
II
rule,
those
potential
costs
were
not
included
in
the
estimate
for
the
final
rule.
EPA
has
determined
that
this
final
rule
does
not
contain
a
federal
mandate
of
$
100
million
or
more.
EPA
has
determined
that
this
rule
contains
no
regulatory
requirements
that
might
significantly
or
uniquely
affect
small
governments.

Thus,
this
rule
is
not
subject
to
the
requirements
of
sections
202
and
205
of
UMRA.
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or
distribute
126
E.
Executive
Order
13132:
Federalism
Executive
Order
13132
(
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."

This
final
rule
does
not
have
federalism
implications.
It
will
not
have
substantial
direct
effects
on
the
States,
on
the
relationship
between
the
Federal
government
and
the
States,
or
on
the
distribution
of
power
and
responsibilities
among
the
various
levels
of
government,
as
specified
in
Executive
Order
13132.
Rather,
this
rule
would
result
in
minimal
administrative
costs
to
States
that
have
an
authorized
NPDES
program.

States
do
not
incur
any
burden
hours
and
nonlabor
costs
to
administer
the
rule
for
new
offshore
oil
and
gas
extraction
facilities
since
these
facilities
are
outside
of
the
jurisdiction
of
the
States.
EPA
has
identified
zero
Phase
III
existing
facilities
that
are
owned
by
federal,
state
or
local
government
entities;
therefore,
the
annual
impacts
on
these
facilities
is
zero.

The
national
cooling
water
intake
structure
requirements
would
be
implemented
through
permits
issued
under
the
NPDES
program.
Forty­
five
States
and
the
Virgin
Islands
are
currently
authorized
pursuant
to
section
402(
b)
of
the
CWA
to
implement
the
NPDES
program.
In
States
not
authorized
to
implement
the
NPDES
program,
EPA
issues
NPDES
permits.
Under
the
CWA,
States
are
not
required
to
become
authorized
to
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Review
Draft­­
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or
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127
administer
the
NPDES
program.
Rather,
such
authorization
is
available
to
States
if
they
operate
their
programs
in
a
manner
consistent
with
section
402(
b)
and
applicable
regulations.
Generally,
these
provisions
require
that
State
NPDES
programs
include
requirements
that
are
as
stringent
as
Federal
program
requirements.
States
retain
the
ability
to
implement
requirements
that
are
broader
in
scope
or
more
stringent
than
Federal
requirements.
(
See
section
510
of
the
CWA.)

This
rule
would
not
have
substantial
direct
effects
on
either
authorized
or
nonauthorized
States
or
on
local
governments
because
it
would
not
change
how
EPA
and
the
States
and
local
governments
interact
or
their
respective
authority
or
responsibilities
for
implementing
the
NPDES
program.
This
rule
would
establish
national
requirements
for
new
offshore
oil
and
gas
extraction
facilities
with
cooling
water
intake
structures.

NPDES­
authorized
States
that
currently
do
not
comply
with
the
regulations
based
on
this
rule
might
need
to
amend
their
regulations
or
statutes
to
ensure
that
their
NPDES
programs
are
consistent
with
Federal
section
316(
b)
requirements.
For
purposes
of
this
rule,
the
relationship
and
distribution
of
power
and
responsibilities
between
the
Federal
government
and
the
States
and
local
governments
are
established
under
the
CWA
(
e.
g.,

sections
402(
b)
and
510);
nothing
in
this
rule
would
alter
that.
Thus,
the
requirements
of
section
6
of
the
Executive
Order
do
not
apply
to
this
rule.

Although
section
6
of
Executive
Order
13132
does
not
apply
to
this
rule,
EPA
did
consult
with
State
governments
and
representatives
of
local
governments
in
developing
the
rule.
During
the
development
of
the
proposed
and
final
Phase
I
and
Phase
II
section
316(
b)
rules
and
the
proposed
Phase
III
rule,
EPA
conducted
several
outreach
activities
through
which
State
and
local
officials
were
informed
about
this
rule
and
they
provided
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cite,
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or
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128
information
and
comments
to
the
Agency.
The
outreach
activities
were
intended
to
provide
EPA
with
feedback
on
issues
such
as
adverse
environmental
impact,
best
technology
available,
and
the
potential
cost
associated
with
various
regulatory
alternatives.
These
outreach
activities
are
discussed
in
section
III
of
the
preamble
to
the
proposed
rule
at
69
FR
68457,
as
well
as
in
the
Response
to
Comment
Document.

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

This
rule
would
not
have
tribal
implications.
It
would
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.
At
this
time,
there
are
no
Tribes
that
own
or
operate
facilities
covered
under
this
rule.
Accordingly,
the
requirements
of
Executive
Order
13175
do
not
apply
to
this
rule.

Nevertheless,
in
the
spirit
of
Executive
Order
13175
and
consistent
with
EPA
policy
to
promote
communications
between
EPA
and
Tribal
governments,
EPA
solicited
comment
on
the
proposed
rule
from
all
stakeholders.
EPA
did
not
receive
any
comments
from
Tribal
governments.
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Review
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or
distribute
129
G.
Executive
Order
13045:
Protection
of
Children
from
Environmental
Health
and
Safety
Risks
Executive
Order
13045
(
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
might
have
a
disproportionate
effect
on
children.
If
the
regulatory
action
meets
both
criteria,
the
Agency
must
evaluate
the
environmental
health
and
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
final
rule
is
not
an
economically
significant
rule
(
using
the
$
100
million
threshold)
as
defined
under
Executive
Order
12866.
Further,
it
does
not
concern
an
environmental
health
or
safety
risk
that
would
have
a
disproportionate
effect
on
children.

H.
Executive
Order
13211:
Actions
That
Significantly
Affect
Energy
Supply,

Distribution,
or
Use
This
rule
is
not
subject
to
Executive
Order
13211,
"
Actions
Concerning
Regulations
That
Significantly
Affect
Energy
Supply,
Distribution,
or
Use"
(
66
FR
28355
(
May
22,
2001))
because
it
is
not
a
significant
regulatory
action
under
Executive
Order
12866.
Based
on
comments
received
at
Proposal,
EPA
examined
the
potential
for
the
regulation
to
cause
a
"
significant
adverse
effect"
on
the
Nation's
energy
economy
through
its
potential
impact
on
petroleum
refining
operations.
EPA
performed
this
analysis,
which
is
documented
in
the
Economic
Analysis
Report
for
the
final
regulation,

in
accordance
with
guidance
for
implementing
Executive
Order
13211
("
Actions
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or
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130
Concerning
Regulations
That
Significantly
Affect
Energy
Supply,
Distribution,
or
Use").

Based
on
this
analysis,
EPA
continues
to
find,
as
stated
at
Proposal,
that
the
316(
b)
Phase
III
regulation
will
not
cause
a
Significant
Adverse
Effect
and
does
not
constitute
a
Significant
Energy
Action
within
the
meaning
of
Executive
Order
13211.
As
a
result,

EPA
did
not
prepare
a
Statement
of
Energy
Effects.

I.
National
Technology
Transfer
and
Advancement
Act
As
noted
in
the
proposed
rule,
Section
12(
d)
of
the
National
Technology
Transfer
and
Advancement
Act
(
NTTAA)
of
1995,
Public
Law
104 
113,
Sec.
12(
d)
directs
EPA
to
use
voluntary
consensus
standards
in
its
regulatory
activities
unless
to
do
so
would
be
inconsistent
with
applicable
law
or
otherwise
impractical.
Voluntary
consensus
standards
are
technical
standards
(
e.
g.,
materials
specifications,
test
methods,
sampling
procedures,

and
business
practices)
that
are
developed
or
adopted
by
voluntary
consensus
standard
bodies.
The
NTTAA
directs
EPA
to
provide
Congress,
through
the
Office
of
Management
and
Budget
(
OMB),
explanations
when
the
Agency
decides
not
to
use
available
and
applicable
voluntary
consensus
standards.
This
rule
does
not
involve
any
technical
standards.
Therefore,
EPA
did
not
considering
the
use
of
any
voluntary
consensus
standards.

J.
E.
O.
12898:
Federal
Actions
to
Address
Environmental
Justice
in
Minority
Populations
and
Low­
Income
Populations
Executive
Order
12898
requires
that,
to
the
greatest
extent
practicable
and
permitted
by
law,
each
Federal
agency
must
make
achieving
environmental
justice
part
of
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or
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131
its
mission.
E.
O.
12898
provides
that
each
Federal
agency
must
conduct
its
programs,

policies,
and
activities
that
substantially
affect
human
health
or
the
environment
in
a
manner
that
ensures
such
programs,
policies,
and
activities
do
not
have
the
effect
of
excluding
persons
(
including
populations)
from
participation
in,
denying
persons
(
including
populations)
the
benefits
of,
or
subjecting
persons
(
including
populations)
to
discrimination
under
such
programs,
policies,
and
activities
because
of
their
race,
color,

or
national
origin.

The
Executive
Order's
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/
or
low­
income
populations.

This
rule
would
require
that
the
location,
design,
construction,
and
capacity
of
cooling
water
intake
structures
at
new
offshore
oil
and
gas
extraction
facilities
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact.
Due
to
the
offshore
location
of
these
facilities,
EPA
does
not
expect
that
this
rule
would
have
an
exclusionary
effect,
deny
persons
the
benefits
of
the
participating
in
a
program,
or
subject
persons
to
discrimination
because
of
their
race,
color,
or
national
origin.

In
fact,
because
EPA
expects
that
this
rule
would
help
to
preserve
the
health
of
aquatic
ecosystems
located
in
reasonable
proximity
to
new
offshore
oil
and
gas
extraction
facilities,
it
believes
that
all
populations,
including
minority
and
low­
income
populations,

would
benefit
from
improved
environmental
conditions
as
a
result
of
this
rule.
Thus
EPA
concludes
that
this
action
will
not
have
the
effect
of
excluding
persons
(
including
Interagency
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or
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132
populations)
from
participating
in,
denying
persons
(
including
populations)
the
benefits
of,
or
subjecting
persons
(
including
populations)
to
discrimination
because
of
their
race,

color,
or
national
origin.

K.
E.
O.
13158:
Marine
Protected
Areas
Executive
Order
13158
(
65
FR
34909,
May
31,
2000)
requires
EPA
to
"
expeditiously
propose
new
science
based
regulations,
as
necessary,
to
ensure
appropriate
levels
of
protection
for
the
marine
environment."
EPA
may
take
action
to
enhance
or
expand
protection
of
existing
marine
protected
areas
and
to
establish
or
recommend,
as
appropriate,
new
marine
protected
areas.
The
purpose
of
the
Executive
Order
is
to
protect
the
significant
natural
and
cultural
resources
within
the
marine
environment,

which
means
"
those
areas
of
coastal
and
ocean
waters,
the
Great
Lakes
and
their
connecting
waters,
and
submerged
lands
thereunder,
over
which
the
United
States
exercises
jurisdiction,
consistent
with
international
law."

This
final
rule
recognizes
the
biological
sensitivity
of
tidal
rivers,
estuaries,
and
oceans
and
their
susceptibility
to
adverse
environmental
impact
from
cooling
water
intake
structures.
This
rule
provides
requirements
for
reducing
both
impingement
and
entrainment
using
technologies
to
minimize
adverse
environmental
impact
for
cooling
water
intake
structures
located
on
these
types
of
waterbodies.

EPA
expects
that
this
rule
would
reduce
impingement
and
entrainment
at
new
offshore
oil
and
gas
extraction
facilities.
The
rule
would
afford
protection
of
aquatic
organisms
at
individual,
population,
community,
and/
or
ecosystem
levels
of
ecological
Interagency
Review
Draft­­
05/
05/
06­­
Deliberative:
do
not
cite,
quote
or
distribute
133
structures.
Therefore,
EPA
expects
this
rule
would
advance
the
objective
of
the
Executive
Order
to
protect
marine
areas.

L.
Congressional
Review
Act
The
Congressional
Review
Act,
5.
U.
S.
C.
801
et
seq.,
as
added
by
the
Small
Business
Regulatory
Enforcement
Fairness
Act
(
SBREFA)
of
1996,
generally
provides
that
before
a
rule
may
take
effect,
the
agency
promulgating
the
rule
must
submit
a
rule
report,
which
includes
a
copy
of
the
rule,
to
each
House
of
the
Congress
and
to
the
Comptroller
General
of
the
United
States.
EPA
will
submit
a
report
containing
this
rule
and
other
required
information
to
the
U.
S.
Senate,
the
U.
S.
House
of
Representatives,
and
the
Comptroller
General
of
the
United
States
prior
to
publication
of
the
rule
in
the
Federal
Register.
A
major
rule
can
not
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
will
be
effective
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER].
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
1
For
the
reasons
set
forth
in
the
preamble,
chapter
I
of
title
40
of
the
Code
of
Federal
Regulations
is
to
be
amended
as
follows:

PART
9 
OMB
APPROVALS
UNDER
THE
PAPERWORK
REDUCTION
ACT
1.
The
authority
citation
for
part
9
continues
to
read
as
follows:

Authority:
7
U.
S.
C.
135
et
seq.,
136­
136y;
15
U.
S.
C.
2001,
2003,
2005,
2006,
2601­

2671,
21
U.
S.
C.
331j,
346a,
348;
31
U.
S.
C.
9701;
33
U.
S.
C.
1251
et
seq.,
1311,
1313d,

1314,
1318,
1321,
1326,
1330,
1342,
1344,
1345
(
d)
and
(
e),
1361;
E.
O.
11735,
38
FR
21243,
3
CFR,
1971­
1975
Comp.
p.
973;
42
U.
S.
C.
241,
242b,
243,
246,
300f,
300g,

300g­
1,
300g­
2,
300g­
3,
300g­
4,
300g­
5,
300g­
6,
300j­
1,
300j­
2,
300j­
3,
300j­
4,
300j­
9,

1857
et
seq.,
6901­
6992k,
7401­
7671q,
7542,
9601­
9657,
11023,
11048.

2.
In
§
9.1
the
table
is
amended
by
revising
the
entry
for
"
122.21(
r)"
and
by
adding
entries
in
numerical
order
under
the
indicated
heading
to
read
as
follows:

§
9.1
OMB
approvals
under
the
Paperwork
Reduction
Act.

*
*
*
*
*

40
CFR
citation
OMB
Control
No.

*
*
*
*
*
*
*

EPA
Administered
Permit
Programs:
The
National
Pollutant
Discharge
Elimination
System
*
*
*
*
*
*
*
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
2
122.21(
r)
.....................................................................................................
2040­
0241,
2040­
0257,
xxxx­
xxxx
*
*
*
*
*
*
*

Criteria
and
Standards
for
the
National
Pollutant
Discharge
Elimination
System
*
*
*
*
*
*
*

125.134                         . 
     .

125.135                         . 
     .

125.136                          
     ..

125.137                          
     ..

125.138                          
     ..

125.139                          
     ..
XXXXXXXX
XXXXXXXX
XXXXXXXX
XXXXXXXX
XXXXXXXX
XXXXXXXX
*
*
*
*
*
*
*
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
3
PART
122 
EPA
ADMINISTERED
PERMIT
PROGRAMS:
THE
NATIONAL
POLLUTANT
DISCHARGE
ELIMINATION
SYSTEM
1.
The
authority
citation
for
part
122
continues
to
read
as
follows:

Authority:
The
Clean
Water
Act,
33
U.
S.
C.
1251
et
seq.

2.
Section
122.21
is
amended
as
follows:

a.
Revising
paragraph
(
r)(
1)(
i).

b.
Adding
a
new
paragraph
(
r)(
2)(
iv).

c.
Revising
paragraph
(
r)(
4)
introductory
text.

§
122.21
Application
for
a
permit
(
applicable
to
State
programs,
see
§
123.25)

*
*
*
*
*

(
r)
Application
requirements
for
facilities
with
cooling
water
intake
structures (
1)(
i)
New
facilities
with
new
or
modified
cooling
water
intake
structures.

New
facilities
(
other
than
offshore
oil
and
gas
extraction
facilities)
with
cooling
water
intake
structures
as
defined
in
part
125,
subpart
I,
of
this
chapter
must
submit
to
the
Director
for
review
the
information
required
under
paragraphs
(
r)(
2)
(
except
(
r)(
2)(
iv)),

(
3),
and
(
4)
of
this
section
and
§
125.86
of
this
chapter
as
part
of
their
application.
New
offshore
oil
and
gas
extraction
facilities
with
cooling
water
intake
structures
as
defined
in
part
125,
subpart
N,
of
this
chapter
that
are
fixed
facilities
must
submit
to
the
Director
for
review
the
information
required
under
paragraphs
(
r)(
2)
(
except
(
r)(
2)(
iv)),
(
3),
and
(
4)
of
this
section
and
§
125.136
of
this
chapter
as
part
of
their
application.
New
offshore
oil
and
gas
extraction
facilities
that
are
not
fixed
facilities
must
submit
to
the
Director
for
review
only
the
information
required
under
paragraphs
(
r)(
2)(
iv),
(
r)(
3)
(
except
(
r)(
3)(
ii)),

and
§
125.136
of
this
chapter
as
part
of
their
application.
Requests
for
alternative
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
4
requirements
under
§
125.85
or
§
125.135
of
this
chapter
must
be
submitted
with
your
permit
application.

*
*
*
*
*

(
2)
*
*
*

(
iv)
For
new
offshore
oil
and
gas
facilities
that
are
not
fixed
facilities,
a
narrative
description
and/
or
locational
maps
providing
information
on
predicted
locations
within
the
waterbody
during
the
permit
term
in
sufficient
detail
for
the
Director
to
determine
the
appropriateness
of
additional
impingement
requirements
under
§

125.134(
b)(
4).

*
*
*
*
*

(
4)
Source
water
baseline
biological
characterization
data.
This
information
is
required
to
characterize
the
biological
community
in
the
vicinity
of
the
cooling
water
intake
structure
and
to
characterize
the
operation
of
the
cooling
water
intake
structures.

The
Director
may
also
use
this
information
in
subsequent
permit
renewal
proceedings
to
determine
if
your
Design
and
Construction
Technology
Plan
as
required
in
§
125.86(
b)(
4)

or
§
125.136(
b)(
3)
of
this
chapter
should
be
revised.
This
supporting
information
must
include
existing
data
(
if
they
are
available).
However,
you
may
supplement
the
data
using
newly
conducted
field
studies
if
you
choose
to
do
so.
The
information
you
submit
must
include:

*
*
*
*
*
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
5
3.
Section
122.44
is
amended
by
revising
paragraph
(
b)(
3)
to
read
as
follows:

§
122.44
Establishing
limitations,
standards,
and
other
permit
conditions
(
applicable
to
State
NPDES
programs,
see
§
123.25).

*
*
*
*
*

(
b)
*
*
*

(
3)
Requirements
applicable
to
cooling
water
intake
structures
under
section
316(
b)

of
the
CWA,
in
accordance
with
part
125,
subparts
I,
J,
and
N
of
this
chapter.

*
*
*
*
*

PART
123 
STATE
PROGRAM
REQUIREMENTS
1.
The
authority
citation
for
part
123
continues
to
read
as
follows:

Authority:
The
Clean
Water
Act,
33
U.
S.
C.
1251
et
seq.

2.
Section
123.25
is
amended
by
revising
paragraph
(
a)(
36)
to
read
as
follows:

§
123.25
Requirements
for
permitting.

(
a)
*
*
*

(
36)
Subparts
A,
B,
D,
H,
I,
J,
and
N
of
part
125
of
this
chapter;

*
*
*
*
*

PART
124 
PROCEDURES
FOR
DECISIONMAKING
1.
The
authority
citation
for
part
124
continues
to
read
as
follows:

Authority:
Resource
Conservation
and
Recovery
Act,
42
U.
S.
C.
6901
et
seq.;
Safe
Drinking
Water
Act,
42
U.
S.
C.
300f
et
seq.;
Clean
Water
Act,
33
U.
S.
C.
1251
et
seq.;

Clean
Air
Act,
42
U.
S.
C.
7401
et
seq.
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
6
2.
Section
124.10
is
amended
by
revising
paragraph
(
d)(
1)(
ix)
to
read
as
follows:

§
124.10
Public
notice
of
permit
actions
and
public
comment
period.

*
*
*
*
*

(
d)
*
*
*

(
1)
*
*
*

(
ix)
Requirements
applicable
to
cooling
water
intake
structures
under
section
316(
b)

of
the
CWA,
in
accordance
with
part
125,
subparts
I
,
J,
and
N
of
this
chapter.

*
*
*
*
*

PART
125 
CRITERIA
AND
STANDARDS
FOR
THE
NATIONAL
POLLUTANT
DISCHARGE
ELIMINATION
SYSTEM
1.
The
authority
citation
for
part
125
continues
to
read
as
follows:

Authority:
Clean
Water
Act,
33
U.
S.
C.
1251
et
seq.;
unless
otherwise
noted.

2.
Add
subpart
N
to
part
125
to
read
as
follows:

Subpart
N 
Requirements
Applicable
to
Cooling
Water
Intake
Structures
for
New
Offshore
Oil
and
Gas
Extraction
Facilities
Under
Section
316(
b)
of
the
Act
Sec.

125.130
What
are
the
purpose
and
scope
of
this
subpart?

125.131
Who
is
subject
to
this
subpart?

125.132
When
must
I
comply
with
this
subpart?

125.133
What
special
definitions
apply
to
this
subpart?

125.134
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

what
must
I
do
to
comply
with
this
subpart?

125.135
May
alternative
requirements
be
authorized?
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
7
125.136
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

what
must
I
collect
and
submit
when
I
apply
for
my
new
or
reissued
NPDES
permit?

125.137
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

must
I
perform
monitoring?

125.138
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

must
I
keep
records
and
report?

125.139
As
the
Director,
what
must
I
do
to
comply
with
the
requirements
of
this
subpart?

Subpart
N 
Requirements
Applicable
to
Cooling
Water
Intake
Structures
for
New
Offshore
Oil
and
Gas
Extraction
Facilities
Under
Section
316(
b)
of
the
Act
§
125.130
What
are
the
purpose
and
scope
of
this
subpart?

(
a)
This
subpart
establishes
requirements
that
apply
to
the
location,
design,

construction,
and
capacity
of
cooling
water
intake
structures
at
new
offshore
oil
and
gas
extraction
facilities.
The
purpose
of
these
requirements
is
to
establish
the
best
technology
available
for
minimizing
adverse
environmental
impact
associated
with
the
use
of
cooling
water
intake
structures
at
these
facilities.
These
requirements
are
implemented
through
National
Pollutant
Discharge
Elimination
System
(
NPDES)
permits
issued
under
section
402
of
the
Clean
Water
Act
(
CWA).

(
b)
This
subpart
implements
section
316(
b)
of
the
CWA
for
new
offshore
oil
and
gas
extraction
facilities.
Section
316(
b)
of
the
CWA
provides
that
any
standard
established
pursuant
to
sections
301
or
306
of
the
CWA
and
applicable
to
a
point
source
shall
require
that
the
location,
design,
construction,
and
capacity
of
cooling
water
intake
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
8
structures
reflect
the
best
technology
available
for
minimizing
adverse
environmental
impact.

(
c)
New
offshore
oil
and
gas
extraction
facilities
that
do
not
meet
the
threshold
requirements
regarding
amount
of
water
withdrawn
or
percentage
of
water
withdrawn
for
cooling
water
purposes
in
§
125.131(
a)
must
meet
requirements
determined
by
the
Director
on
a
case­
by­
case,
best
professional
judgement
(
BPJ)
basis.

(
d)
Nothing
in
this
subpart
shall
be
construed
to
preclude
or
deny
the
right
of
any
State
or
political
subdivision
of
a
State
or
any
interstate
agency
under
section
510
of
the
CWA
to
adopt
or
enforce
any
requirement
with
respect
to
control
or
abatement
of
pollution
that
is
more
stringent
than
those
required
by
Federal
law.

§
125.131
Who
is
subject
to
this
subpart?

(
a)
This
subpart
applies
to
a
new
offshore
oil
and
gas
extraction
facility
if
it
meets
all
of
the
following
criteria:

(
1)
It
is
a
point
source
that
uses
or
proposes
to
use
a
cooling
water
intake
structure;

(
2)
It
has
at
least
one
cooling
water
intake
structure
that
uses
at
least
25
percent
of
the
water
it
withdraws
for
cooling
purposes
as
specified
in
paragraph
(
c)
of
this
section;
and
(
3)
It
has
a
design
intake
flow
greater
than
two
(
2)
million
gallons
per
day
(
MGD).

(
b)
Use
of
a
cooling
water
intake
structure
includes
obtaining
cooling
water
by
any
sort
of
contract
or
arrangement
with
an
independent
supplier
(
or
multiple
suppliers)

of
cooling
water
if
the
supplier
or
suppliers
withdraw(
s)
water
from
waters
of
the
United
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
9
States.
Use
of
cooling
water
does
not
include
obtaining
cooling
water
from
a
public
water
system
or
the
use
of
treated
effluent
that
otherwise
would
be
discharged
to
a
water
of
the
U.
S.
This
provision
is
intended
to
prevent
circumvention
of
these
requirements
by
creating
arrangements
to
receive
cooling
water
from
an
entity
that
is
not
itself
a
point
source.

(
c)
The
threshold
requirement
that
at
least
25
percent
of
water
withdrawn
be
used
for
cooling
purposes
must
be
measured
on
an
average
monthly
basis.
A
new
offshore
oil
and
gas
extraction
facility
meets
the
25
percent
cooling
water
threshold
if,

based
on
the
new
facility's
design,
any
monthly
average
over
a
year
for
the
percentage
of
cooling
water
withdrawn
is
expected
to
equal
or
exceed
25
percent
of
the
total
water
withdrawn.

(
d)
Neither
this
subpart
nor
Subpart
I
applies
to
seafood
processing
vessels
and
offshore
liquefied
natural
gas
import
terminals
that
are
new
facilities
as
defined
in
40
CFR
125.83.
Seafood
processing
vessels
and
offshore
liquefied
natural
gas
import
terminals
must
meet
requirements
established
by
the
Director
on
a
case­
by­
case,
best
professional
judgment
(
BPJ)
basis.

§
125.132
When
must
I
comply
with
this
subpart?

You
must
comply
with
this
subpart
when
an
NPDES
permit
containing
requirements
consistent
with
this
subpart
is
issued
to
you.

§
125.133
What
special
definitions
apply
to
this
subpart?

In
addition
to
the
definitions
set
forth
at
40
CFR
125.83,
the
following
special
definitions
apply
to
this
subpart:
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
10
Cooling
water
means
water
used
for
contact
or
noncontact
cooling,
including
water
used
for
equipment
cooling,
evaporative
cooling
tower
makeup,
and
dilution
of
effluent
heat
content.
The
intended
use
of
the
cooling
water
is
to
absorb
waste
heat
rejected
from
the
process
or
processes
used,
or
from
auxiliary
operations
on
the
facility's
premises.
Cooling
water
that
is
used
in
another
industrial
process
either
before
or
after
it
is
used
for
cooling
is
considered
process
water
for
the
purposes
of
calculating
the
percentage
of
a
new
offshore
oil
and
gas
extraction
facility's
intake
flow
that
is
used
for
cooling
purposes
in
§
125.131(
c).

Fixed
facility
means
a
bottom
founded
offshore
oil
and
gas
extraction
facility
permanently
attached
to
the
seabed
or
subsoil
of
the
outer
continental
shelf
(
e.
g.,

platforms,
guyed
towers,
articulated
gravity
platforms)
or
a
buoyant
facility
securely
and
substantially
moored
so
that
it
cannot
be
moved
without
a
special
effort
(
e.
g.,
tension
leg
platforms,
permanently
moored
semi­
submersibles)
and
which
is
not
intended
to
be
moved
during
the
production
life
of
the
well.
This
definition
does
not
include
mobile
offshore
drilling
units
(
MODUs)
(
e.
g.,
drill
ships,
temporarily
moored
semi­
submersibles,

jack­
ups,
submersibles,
tender­
assisted
rigs,
and
drill
barges).

Minimum
ambient
source
water
surface
elevation
means
the
mean
low
tidal
water
level
for
estuaries
or
oceans.
The
mean
low
tidal
water
level
is
the
average
height
of
the
low
water
over
at
least
19
years.

New
offshore
oil
and
gas
extraction
facility
means
any
building,
structure,
facility,

or
installation
that:
(
i)
meets
the
definition
of
a
"
new
facility"
40
CFR
125.83;
and
(
ii)
is
regulated
by
the
Offshore
and
Coastal
Subcategories
of
the
Oil
and
Gas
Extraction
Point
Source
Category
Effluent
Guidelines
in
40
CFR
435.10
or
40
CFR
435.40;
but
only
if
it
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
11
commences
construction
after
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER].

Offshore
liquefied
natural
gas
(
LNG)
import
terminal
means
any
facility
located
in
waters
defined
in
40
CFR
435.10
or
40
CFR
435.40
that
liquefies,
re­
gasifies,

transfers,
or
stores
liquefied
natural
gas.

Sea
chest
means
the
underwater
compartment
or
cavity
within
the
facility
or
vessel
hull
or
pontoon
through
which
sea
water
is
drawn
in
(
for
cooling
and
other
purposes)
or
discharged.

Seafood
processing
vessel
means
any
offshore
or
nearshore,
floating,
mobile,

facility
engaged
in
the
processing
of
fresh,
frozen,
canned,
smoked,
salted
or
pickled
seafood,
seafood
paste,
mince,
or
meal.

§
125.134
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

what
must
I
do
to
comply
with
this
subpart?

(
a)(
1)
The
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility
must
comply
with:

(
i)
Track
I
in
paragraph
(
b)
or
Track
II
in
paragraph
(
c)
of
this
section,

if
it
is
a
fixed
facility;
or
(
ii)
Track
I
in
paragraph
(
b)
of
this
section,
if
it
is
not
a
fixed
facility.

(
2)
In
addition
to
meeting
the
requirements
in
paragraph
(
b)
or
(
c)
of
this
section,
the
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility
may
be
required
to
comply
with
paragraph
(
d)
of
this
section.

(
b)
Track
I
requirements
for
new
offshore
oil
and
gas
extraction
facilities.
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
12
(
1)(
i)
New
offshore
oil
and
gas
extraction
facilities
that
withdraw
greater
than
2
MGD,
do
not
employ
sea
chests
as
cooling
water
intake
structures,
and
are
fixed
facilities
must
comply
with
all
of
the
requirements
in
paragraphs
(
b)(
2)
through
(
8)
of
this
section.

(
ii)
New
offshore
oil
and
gas
extraction
facilities
that
withdraw
greater
than
2
MGD,
employ
sea
chests
as
cooling
water
intake
structures,
and
are
fixed
facilities
must
comply
with
the
requirements
in
paragraphs
(
b)(
2),
(
3),
(
4),
(
6),
(
7),
and
(
8)
of
this
section.

(
iii)
New
offshore
oil
and
gas
extraction
facilities
that
withdraw
greater
than
2
MGD
and
are
not
fixed
facilities
must
comply
with
the
requirements
in
paragraphs
(
b)(
2),

(
4),
(
6),
(
7),
and
(
8)
of
this
section.

(
2)
You
must
design
and
construct
each
cooling
water
intake
structure
at
your
facility
to
a
maximum
through­
screen
design
intake
velocity
of
0.5
ft/
s;

(
3)
For
cooling
water
intake
structures
located
in
an
estuary
or
tidal
river,
the
total
design
intake
flow
over
one
tidal
cycle
of
ebb
and
flow
must
be
no
greater
than
one
(
1)
percent
of
the
volume
of
the
water
column
within
the
area
centered
about
the
opening
of
the
intake
with
a
diameter
defined
by
the
distance
of
one
tidal
excursion
at
the
mean
low
water
level;

(
4)
You
must
select
and
implement
design
and
construction
technologies
or
operational
measures
for
minimizing
impingement
mortality
of
fish
and
shellfish
if
the
Director
determines
that:

(
i)
There
are
threatened
or
endangered
or
otherwise
protected
federal,
state,
or
tribal
species,
or
critical
habitat
for
these
species,
within
the
hydraulic
zone
of
influence
of
the
cooling
water
intake
structure;
or
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
13
(
ii)
Based
on
information
submitted
by
any
fishery
management
agency(
ies)

or
other
relevant
information,
there
are
migratory
and/
or
sport
or
commercial
species
of
impingement
concern
to
the
Director
that
pass
through
the
hydraulic
zone
of
influence
of
the
cooling
water
intake
structure;
or
(
iii)
Based
on
information
submitted
by
any
fishery
management
agency(
ies)

or
other
relevant
information,
that
the
proposed
facility,
after
meeting
the
technologybased
performance
requirements
in
paragraphs
(
b)(
2)
and
(
5)
of
this
section,
would
still
contribute
unacceptable
stress
to
the
protected
species,
critical
habitat
of
those
species,
or
species
of
concern;

(
5)
You
must
select
and
implement
design
and
construction
technologies
or
operational
measures
for
minimizing
entrainment
of
entrainable
life
stages
of
fish
and
shellfish;

(
6)
You
must
submit
the
applicable
application
information
required
in
40
CFR
122.21(
r)
and
§
125.136(
b).
If
you
are
a
fixed
facility
you
must
submit
the
information
required
in
40
CFR
122.21(
r)(
2)
(
except
(
r)(
2)(
iv)),
(
3),
and
(
4)
and
§
125.136(
b)
of
this
subpart
as
part
of
your
application.
If
you
are
a
not
a
fixed
facility,

you
must
only
submit
the
information
required
in
40
CFR
122.21(
r)(
2)(
iv),
(
r)(
3)
(
except
(
r)(
3)(
ii))
and
§
125.136(
b)
as
part
of
your
application.

(
7)
You
must
implement
the
monitoring
requirements
specified
in
§
125.137;

(
8)
You
must
implement
the
recordkeeping
requirements
specified
in
§
125.138.

(
c)
Track
II
requirements
for
new
offshore
oil
and
gas
extraction
facilities.

The
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility
that
is
a
fixed
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
14
facility
and
chooses
to
comply
under
Track
II
must
comply
with
the
following
requirements:

(
1)
You
must
demonstrate
to
the
Director
that
the
technologies
employed
will
reduce
the
level
of
adverse
environmental
impact
from
your
cooling
water
intake
structures
to
a
comparable
level
to
that
which
you
would
achieve
were
you
to
implement
the
applicable
requirements
of
paragraph
(
b)(
2)
and,
if
your
facility
is
a
fixed
facility
without
a
sea
chest,
also
paragraph
(
b)(
5)
of
this
section.
This
demonstration
must
include
a
showing
that
the
impacts
to
fish
and
shellfish,
including
important
forage
and
predator
species
will
be
comparable
to
those
which
would
result
if
you
were
to
implement
the
requirements
of
paragraph
(
b)(
2)
and,
if
your
facility
is
a
fixed
facility
without
a
sea
chest,
also
paragraph
(
b)(
5)
of
this
section.
In
identifying
such
species,
the
Director
may
consider
information
provided
by
any
fishery
management
agency(
ies)
along
with
data
and
information
from
other
sources.

(
2)
For
cooling
water
intake
structures
located
in
an
estuary
or
tidal
river,
the
total
design
intake
flow
over
one
tidal
cycle
of
ebb
and
flow
must
be
no
greater
than
one
(
1)
percent
of
the
volume
of
the
water
column
within
the
area
centered
about
the
opening
of
the
intake
with
a
diameter
defined
by
the
distance
of
one
tidal
excursion
at
the
mean
low
water
level.

(
3)
You
must
submit
the
application
information
required
in
40
CFR
122.21(
r)(
2)
(
except
(
r)(
2)(
iv)),
(
3)
and
(
4)
and
§
125.136(
c).

(
4)
You
must
implement
the
monitoring
requirements
specified
in
§
125.137.

(
5)
You
must
implement
the
record­
keeping
requirements
specified
in
§
125.138.
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
15
(
d)
You
must
comply
with
any
more
stringent
requirements
relating
to
the
location,
design,
construction,
and
capacity
of
a
cooling
water
intake
structure
or
monitoring
requirements
at
a
new
offshore
oil
and
gas
extraction
facility
that
the
Director
deems
are
reasonably
necessary
to
comply
with
any
provision
of
federal
or
state
law,

including
compliance
with
applicable
state
water
quality
standards
(
including
designated
uses,
criteria,
and
antidegradation
requirements).

§
125.135
May
alternative
requirements
be
authorized?

(
a)
Any
interested
person
may
request
that
alternative
requirements
less
stringent
than
those
specified
in
§
125.134(
a)
through
(
d)
be
imposed
in
the
permit.
The
Director
may
establish
alternative
requirements
less
stringent
than
the
requirements
of
§

125.134(
a)
through
(
d)
only
if:

(
1)
There
is
an
applicable
requirement
under
§
125.134(
a)
through
(
d);

(
2)
The
Director
determines
that
data
specific
to
the
facility
indicate
that
compliance
with
the
requirement
at
issue
would
result
in
compliance
costs
wholly
out
of
proportion
to
the
costs
EPA
considered
in
establishing
the
requirement
at
issue
or
would
result
in
significant
adverse
impacts
on
local
water
resources
other
than
impingement
or
entrainment,
or
significant
adverse
impacts
on
energy
markets;

(
3)
The
alternative
requirement
requested
is
no
less
stringent
than
justified
by
the
wholly
out
of
proportion
cost
or
the
significant
adverse
impacts
on
local
water
resources
other
than
impingement
or
entrainment,
or
significant
adverse
impacts
on
energy
markets;
and
(
4)
The
alternative
requirement
will
ensure
compliance
with
other
applicable
provisions
of
the
Clean
Water
Act
and
any
applicable
requirement
of
federal
or
state
law.
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
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cite,
quote
or
distribute
16
(
b)
The
burden
is
on
the
person
requesting
the
alternative
requirement
to
demonstrate
that
alternative
requirements
should
be
authorized.

§
125.136
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

what
must
I
collect
and
submit
when
I
apply
for
my
new
or
reissued
NPDES
permit?

(
a)(
1)
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

you
must
submit
to
the
Director
a
statement
that
you
intend
to
comply
with
either:

(
i)
The
Track
I
requirements
for
new
offshore
oil
and
gas
extraction
facilities
in
§
125.134(
b);
or
(
ii)
If
you
are
a
fixed
facility,
the
Track
II
requirements
in
§
125.134(
c).

(
2)
You
must
also
submit
the
application
information
required
by
40
CFR
122.21(
r)
and
the
information
required
in
either
paragraph
(
b)
of
this
section
for
Track
I
or,
if
you
are
a
fixed
facility
that
chooses
to
comply
under
Track
II,
paragraph
(
c)
of
this
section
for
Track
II
when
you
apply
for
a
new
or
reissued
NPDES
permit
in
accordance
with
40
CFR
122.21.

(
b)
Track
I
application
requirements.
To
demonstrate
compliance
with
Track
I
requirements
in
§
125.134(
b),
you
must
collect
and
submit
to
the
Director
the
information
in
paragraphs
(
b)(
1)
through
(
3)
of
this
section.

(
1)
Velocity
information.
You
must
submit
the
following
information
to
the
Director
to
demonstrate
that
you
are
complying
with
the
requirement
to
meet
a
maximum
through­
screen
design
intake
velocity
of
no
more
than
0.5
ft/
s
at
each
cooling
water
intake
structure
as
required
in
§
125.134(
b)(
2):
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
17
(
i)
A
narrative
description
of
the
design,
structure,
equipment,
and
operation
used
to
meet
the
velocity
requirement;
and
(
ii)
Design
calculations
showing
that
the
velocity
requirement
will
be
met
at
minimum
ambient
source
water
surface
elevations
(
based
on
best
professional
judgment
using
available
hydrological
data)
and
maximum
head
loss
across
the
screens
or
other
device.

(
2)
Source
waterbody
flow
information.
If
you
are
a
fixed
facility
and
your
cooling
water
intake
structure
is
located
in
an
estuary
or
tidal
river,
you
must
provide
the
mean
low
water
tidal
excursion
distance
and
any
supporting
documentation
and
engineering
calculations
to
show
that
your
cooling
water
intake
structure
facility
meets
the
flow
requirements
in
§
125.134(
b)(
3).

(
3)
Design
and
Construction
Technology
Plan.
To
comply
with
§

125.134(
b)(
4)
and/
or
(
5),
if
applicable,
you
must
submit
to
the
Director
the
following
information
in
a
Design
and
Construction
Technology
Plan:

(
i)
If
the
Director
determines
that
additional
impingement
requirements
should
be
included
in
your
permit:

(
A)
Information
to
demonstrate
whether
or
not
you
meet
the
criteria
in
§

125.134(
b)(
4);

(
B)
Delineation
of
the
hydraulic
zone
of
influence
for
your
cooling
water
intake
structure;

(
ii)
New
offshore
oil
and
gas
extraction
facilities
required
to
install
design
and
construction
technologies
and/
or
operational
measures
must
develop
a
plan
explaining
the
technologies
and
measures
you
have
selected.
(
Examples
of
appropriate
technologies
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
18
include,
but
are
not
limited
to,
increased
opening
to
cooling
water
intake
structure
to
decrease
design
intake
velocity,
wedgewire
screens,
fixed
screens,
velocity
caps,
location
of
cooling
water
intake
opening
in
waterbody,
etc.
Examples
of
appropriate
operational
measures
include,
but
are
not
limited
to,
seasonal
shutdowns
or
reductions
in
flow,

continuous
operations
of
screens,
etc.)
The
plan
must
contain
the
following
information,

if
applicable:

(
A)
A
narrative
description
of
the
design
and
operation
of
the
design
and
construction
technologies,
including
fish­
handling
and
return
systems,
that
you
will
use
to
maximize
the
survival
of
those
species
expected
to
be
most
susceptible
to
impingement.

Provide
species­
specific
information
that
demonstrates
the
efficacy
of
the
technology;

(
B)
To
demonstrate
compliance
with
125.134(
b)(
5),
if
applicable,
a
narrative
description
of
the
design
and
operation
of
the
design
and
construction
technologies
that
you
will
use
to
minimize
entrainment
of
those
species
expected
to
be
the
most
susceptible
to
entrainment.
Provide
species­
specific
information
that
demonstrates
the
efficacy
of
the
technology;
and
(
C)
Design
calculations,
drawings,
and
estimates
to
support
the
descriptions
provided
in
paragraphs
(
b)(
3)(
ii)(
A)
and
(
B)
of
this
section.

(
c)
Application
requirements
for
Track
II.
If
you
are
a
fixed
facility
and
have
chosen
to
comply
with
the
requirements
of
Track
II
in
§
125.134(
c)
you
must
collect
and
submit
the
following
information:

(
1)
Source
waterbody
flow
information.
If
your
cooling
water
intake
structure
is
located
in
an
estuary
or
tidal
river,
you
must
provide
the
mean
low
water
tidal
excursion
distance
and
any
supporting
documentation
and
engineering
calculations
to
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
19
show
that
your
cooling
water
intake
structure
facility
meets
the
flow
requirements
in
§

125.134(
c)(
2);

(
2)
Track
II
Comprehensive
Demonstration
Study.
You
must
perform
and
submit
the
results
of
a
Comprehensive
Demonstration
Study
(
Study).
This
information
is
required
to
characterize
the
source
water
baseline
in
the
vicinity
of
the
cooling
water
intake
structure(
s),
characterize
operation
of
the
cooling
water
intake(
s),
and
to
confirm
that
the
technology(
ies)
proposed
and/
or
implemented
at
your
cooling
water
intake
structure
reduce
the
impacts
to
fish
and
shellfish
to
levels
comparable
to
those
you
would
achieve
were
you
to
implement
the
applicable
requirements
in
§
125.134(
b)

(
i)
To
meet
the
"
comparable
level"
requirement,
you
must
demonstrate
that:

(
A)
You
have
reduced
impingement
mortality
of
all
life
stages
of
fish
and
shellfish
to
90
percent
or
greater
of
the
reduction
that
would
be
achieved
through
the
applicable
requirements
in
§
125.134(
b)(
2);
and
(
B)
If
you
are
a
facility
without
sea
chests,
you
have
minimized
entrainment
of
entrainable
life
stages
of
fish
and
shellfish
in
accordance
with
§
125.134(
b)(
5);

(
ii)
You
must
develop
and
submit
a
plan
to
the
Director
containing
a
proposal
for
how
information
will
be
collected
to
support
the
study.
The
plan
must
include:

(
A)
A
description
of
the
proposed
and/
or
implemented
technology(
ies)
to
be
evaluated
in
the
Study;

(
B)
A
list
and
description
of
any
historical
studies
characterizing
the
physical
and
biological
conditions
in
the
vicinity
of
the
proposed
or
actual
intakes
and
their
relevancy
to
the
proposed
Study.
If
you
propose
to
rely
on
existing
source
water
body
data,
it
must
be
no
more
than
5
years
old,
you
must
demonstrate
that
the
existing
data
are
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
20
sufficient
to
develop
a
scientifically
valid
estimate
of
potential
impingement
mortality
and
(
if
applicable)
entrainment
impacts,
and
provide
documentation
showing
that
the
data
were
collected
using
appropriate
quality
assurance/
quality
control
procedures;

(
C)
Any
public
participation
or
consultation
with
Federal
or
State
agencies
undertaken
in
developing
the
plan;
and
(
D)
A
sampling
plan
for
data
that
will
be
collected
using
actual
field
studies
in
the
source
water
body.
The
sampling
plan
must
document
all
methods
and
quality
assurance
procedures
for
sampling,
and
data
analysis.
The
sampling
and
data
analysis
methods
you
propose
must
be
appropriate
for
a
quantitative
survey
and
based
on
consideration
of
methods
used
in
other
studies
performed
in
the
source
water
body.
The
sampling
plan
must
include
a
description
of
the
study
area
(
including
the
area
of
influence
of
the
cooling
water
intake
structure
and
at
least
100
meters
beyond);

taxonomic
identification
of
the
sampled
or
evaluated
biological
assemblages
(
including
all
life
stages
of
fish
and
shellfish);
and
sampling
and
data
analysis
methods;
and
(
iii)
You
must
submit
documentation
of
the
results
of
the
Study
to
the
Director.

Documentation
of
the
results
of
the
Study
must
include:

(
A)
Source
Water
Biological
Study.
The
Source
Water
Biological
Study
must
include:

(
1)
A
taxonomic
identification
and
characterization
of
aquatic
biological
resources
including:
a
summary
of
historical
and
contemporary
aquatic
biological
resources;
determination
and
description
of
the
target
populations
of
concern
(
those
species
of
fish
and
shellfish
and
all
life
stages
that
are
most
susceptible
to
impingement
and
entrainment);
and
a
description
of
the
abundance
and
temporal/
spatial
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
21
characterization
of
the
target
populations
based
on
the
collection
of
multiple
years
of
data
to
capture
the
seasonal
and
daily
activities
(
e.
g.,
spawning,
feeding
and
water
column
migration)
of
all
life
stages
of
fish
and
shellfish
found
in
the
vicinity
of
the
cooling
water
intake
structure;

(
2)
An
identification
of
all
threatened
or
endangered
species
that
might
be
susceptible
to
impingement
and
entrainment
by
the
proposed
cooling
water
intake
structure(
s);
and
(
3)
A
description
of
additional
chemical,
water
quality,
and
other
anthropogenic
stresses
on
the
source
waterbody.

(
B)
Evaluation
of
potential
cooling
water
intake
structure
effects.
This
evaluation
will
include:

(
1)
Calculations
of
the
reduction
in
impingement
mortality
and,
if
applicable,

entrainment
of
all
life
stages
of
fish
and
shellfish
that
would
need
to
be
achieved
by
the
technologies
you
have
selected
to
implement
to
meet
requirements
under
Track
II.
To
do
this,
you
must
determine
the
reduction
in
impingement
mortality
and
entrainment
that
would
be
achieved
by
implementing
the
requirements
of
§
125.134(
b)(
2)
and,
for
facilities
without
sea
chests,
§
125.134(
b)(
5)
of
Track
I
at
your
site.

(
2)
An
engineering
estimate
of
efficacy
for
the
proposed
and/
or
implemented
technologies
used
to
minimize
impingement
mortality
and
(
if
applicable)
entrainment
of
all
life
stages
of
fish
and
shellfish
and
maximize
survival
of
impinged
life
stages
of
fish
and
shellfish.
You
must
demonstrate
that
the
technologies
reduce
impingement
mortality
and
(
if
applicable)
entrainment
of
all
life
stages
of
fish
and
shellfish
to
a
comparable
level
to
that
which
you
would
achieve
were
you
to
implement
the
requirements
in
§
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
22
125.134(
b)(
2)
and,
for
facilities
without
sea
chests,
§
125.134(
b)(
5)
of
Track
I.
The
efficacy
projection
must
include
a
site­
specific
evaluation
of
technology(
ies)
suitability
for
reducing
impingement
mortality
and
(
if
applicable)
entrainment
based
on
the
results
of
the
Source
Water
Biological
Study
in
paragraph
(
c)(
2)(
iii)(
A)
of
this
section.
Efficacy
estimates
may
be
determined
based
on
case
studies
that
have
been
conducted
in
the
vicinity
of
the
cooling
water
intake
structure
and/
or
site­
specific
technology
prototype
studies.

(
C)
Verification
monitoring
plan.
You
must
include
in
the
Study
a
plan
to
conduct,
at
a
minimum,
two
years
of
monitoring
to
verify
the
full­
scale
performance
of
the
proposed
or
implemented
technologies,
operational
measures.
The
verification
study
must
begin
at
the
start
of
operations
of
the
cooling
water
intake
structure
and
continue
for
a
sufficient
period
of
time
to
demonstrate
that
the
facility
is
reducing
the
level
of
impingement
mortality
and
(
if
applicable)
entrainment
to
the
level
documented
in
paragraph
(
c)(
2)(
iii)(
B)
of
this
section.
The
plan
must
describe
the
frequency
of
monitoring
and
the
parameters
to
be
monitored.
The
Director
will
use
the
verification
monitoring
to
confirm
that
you
are
meeting
the
level
of
impingement
mortality
and
entrainment
reduction
required
in
§
125.134(
c),
and
that
the
operation
of
the
technology
has
been
optimized.

§
125.137
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

must
I
perform
monitoring?

As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,
you
will
be
required
to
perform
monitoring
to
demonstrate
your
compliance
with
the
requirements
specified
in
§
125.134
or
alternative
requirements
under
§
125.135.
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
23
(
a)
Biological
monitoring.

(
1)(
i)
Fixed
facilities
without
sea
chests
that
choose
to
comply
with
the
Track
I
requirements
in
§
125.134(
b)(
1)(
i)
must
monitor
for
entrainment.
These
facilities
are
not
required
to
monitor
for
impingement,
unless
the
Director
determines
that
the
information
would
be
necessary
to
evaluate
the
need
for
or
compliance
with
additional
requirements
in
accordance
with
§
125.134(
b)(
4)
or
more
stringent
requirements
in
accordance
with
§

125.134(
d).

(
ii)
Fixed
facilities
with
sea
chests
that
choose
to
comply
with
Track
I
requirements
are
not
required
to
perform
biological
monitoring
unless
the
Director
determines
that
the
information
would
be
necessary
to
evaluate
the
need
for
or
compliance
with
additional
requirements
in
accordance
with
§
125.134(
b)(
4)
or
more
stringent
requirements
in
accordance
with
§
125.134(
d).

(
iii)
Facilities
that
are
not
fixed
facilities
are
not
required
to
perform
biological
monitoring
unless
the
Director
determines
that
the
information
would
be
necessary
to
evaluate
the
need
for
or
compliance
with
additional
requirements
in
accordance
with
§

125.134(
b)(
4)
or
more
stringent
requirements
in
accordance
with
§
125.134(
d).

(
iv)
Fixed
facilities
with
sea
chests
that
choose
to
comply
with
Track
II
requirements
in
accordance
with
§
125.134(
c),
must
monitor
for
impingement
only.

Fixed
facilities
without
sea
chests
that
choose
to
comply
with
Track
II
requirements,
must
monitor
for
both
impingement
and
entrainment.

(
2)
Monitoring
must
characterize
the
impingement
rates
and
(
if
applicable)

entrainment
rates)
of
commercial,
recreational,
and
forage
base
fish
and
shellfish
species
identified
in
the
Source
Water
Baseline
Biological
Characterization
data
required
by
40
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
24
CFR
122.21(
r)(
4),
identified
in
the
Comprehensive
Demonstration
Study
required
by
§
125.136(
c)(
2),
or
as
specified
by
the
Director.

(
3)
The
monitoring
methods
used
must
be
consistent
with
those
used
for
the
Source
Water
Baseline
Biological
Characterization
data
required
in
40
CFR
122.21(
r)(
4),

those
used
by
the
Comprehensive
Demonstration
Study
required
by
§
125.136(
c)(
2),
or
as
specified
by
the
Director.
You
must
follow
the
monitoring
frequencies
identified
below
for
at
least
two
(
2)
years
after
the
initial
permit
issuance.
After
that
time,
the
Director
may
approve
a
request
for
less
frequent
sampling
in
the
remaining
years
of
the
permit
term
and
when
the
permit
is
reissued,
if
supporting
data
show
that
less
frequent
monitoring
would
still
allow
for
the
detection
of
any
seasonal
and
daily
variations
in
the
species
and
numbers
of
individuals
that
are
impinged
or
entrained.

(
4)
Impingement
sampling.
You
must
collect
samples
to
monitor
impingement
rates
(
simple
enumeration)
for
each
species
over
a
24­
hour
period
and
no
less
than
once
per
month
when
the
cooling
water
intake
structure
is
in
operation.

(
5)
Entrainment
sampling.
If
your
facility
is
subject
to
the
requirements
of
§

125.134(
b)(
1)(
i),
or
if
your
facility
is
subject
to
§
125.134(
c)
and
is
a
fixed
facility
without
a
sea
chest,
you
must
collect
samples
to
monitor
entrainment
rates
(
simple
enumeration)
for
each
species
over
a
24­
hour
period
and
no
less
than
biweekly
during
the
primary
period
of
reproduction,
larval
recruitment,
and
peak
abundance
identified
during
the
Source
Water
Baseline
Biological
Characterization
required
by
40
CFR
122.21(
r)(
4)

or
the
Comprehensive
Demonstration
Study
required
in
§
125.136(
c)(
2).
You
must
collect
samples
only
when
the
cooling
water
intake
structure
is
in
operation.
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
not
cite,
quote
or
distribute
25
(
b)
Velocity
monitoring.
If
your
facility
uses
a
surface
intake
screen
systems,

you
must
monitor
head
loss
across
the
screens
and
correlate
the
measured
value
with
the
design
intake
velocity.
The
head
loss
across
the
intake
screen
must
be
measured
at
the
minimum
ambient
source
water
surface
elevation
(
best
professional
judgment
based
on
available
hydrological
data).
The
maximum
head
loss
across
the
screen
for
each
cooling
water
intake
structure
must
be
used
to
determine
compliance
with
the
velocity
requirement
in
§
125.134(
b)(
2).
If
your
facility
uses
devices
other
than
surface
intake
screens,
you
must
monitor
velocity
at
the
point
of
entry
through
the
device.
You
must
monitor
head
loss
or
velocity
during
initial
facility
startup,
and
thereafter,
at
the
frequency
specified
in
your
NPDES
permit,
but
no
less
than
once
per
quarter.

(
c)
Visual
or
remote
inspections.
You
must
either
conduct
visual
inspections
or
employ
remote
monitoring
devices
during
the
period
the
cooling
water
intake
structure
is
in
operation.
You
must
conduct
visual
inspections
at
least
weekly
to
ensure
that
any
design
and
construction
technologies
required
in
§
125.134(
b)(
4),
(
b)(
5),
(
c),
and/
or
(
d)

are
maintained
and
operated
to
ensure
that
they
will
continue
to
function
as
designed.

Alternatively,
you
must
inspect
via
remote
monitoring
devices
to
ensure
that
the
impingement
and
entrainment
technologies
are
functioning
as
designed.

§
125.138
As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,

must
I
keep
records
and
report?

As
an
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility
you
are
required
to
keep
records
and
report
information
and
data
to
the
Director
as
follows:

(
a)
You
must
keep
records
of
all
the
data
used
to
complete
the
permit
application
and
show
compliance
with
the
requirements,
any
supplemental
information
EPA
Interagency
Review
Draft 
05/
11/
2006­­
Deliberative:
do
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cite,
quote
or
distribute
26
developed
under
§
125.136,
and
any
compliance
monitoring
data
submitted
under
§

125.137,
for
a
period
of
at
least
three
(
3)
years
from
the
date
of
permit
issuance.
The
Director
may
require
that
these
records
be
kept
for
a
longer
period.

(
b)
You
must
provide
the
following
to
the
Director
in
a
yearly
status
report:

(
1)
For
fixed
facilities,
biological
monitoring
records
for
each
cooling
water
intake
structure
as
required
by
§
125.137(
a);

(
2)
Velocity
and
head
loss
monitoring
records
for
each
cooling
water
intake
structure
as
required
by
§
125.137(
b);
and
(
3)
Records
of
visual
or
remote
inspections
as
required
in
§
125.137(
c).

§
125.139
As
the
Director,
what
must
I
do
to
comply
with
the
requirements
of
this
subpart?

(
a)
Permit
application.
As
the
Director,
you
must
review
materials
submitted
by
the
applicant
under
40
CFR
122.21(
r),
§
125.135,
and
§
125.136
at
the
time
of
the
initial
permit
application
and
before
each
permit
renewal
or
reissuance.

(
1)
After
receiving
the
initial
permit
application
from
the
owner
or
operator
of
a
new
offshore
oil
and
gas
extraction
facility,
the
Director
must
determine
applicable
standards
in
§
125.134
or
§
125.135
to
apply
to
the
new
offshore
oil
and
gas
extraction
facility.
In
addition,
the
Director
must
review
materials
to
determine
compliance
with
the
applicable
standards.

(
2)
For
each
subsequent
permit
renewal,
the
Director
must
review
the
application
materials
and
monitoring
data
to
determine
whether
requirements,
or
additional
requirements,
for
design
and
construction
technologies
or
operational
measures
should
be
included
in
the
permit.
EPA
Interagency
Review
Draft 
05/
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2006­­
Deliberative:
do
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or
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27
(
3)
For
Track
II
facilities,
the
Director
may
review
the
information
collection
proposal
plan
required
by
§
125.136(
c)(
2)(
ii).
The
facility
may
initiate
sampling
and
data
collection
activities
prior
to
receiving
comment
from
the
Director.

(
b)
Permitting
requirements.
Section
316(
b)
requirements
are
implemented
for
a
facility
through
an
NPDES
permit.
As
the
Director,
you
must
determine,
based
on
the
information
submitted
by
the
new
offshore
oil
and
gas
extraction
facility
in
its
permit
application,
the
appropriate
requirements
and
conditions
to
include
in
the
permit
based
on
the
track
(
Track
I
or
Track
II),
or
alternative
requirements
in
accordance
with
§
125.135,

the
new
offshore
oil
and
gas
extraction
facility
has
chosen
to
comply
with.
The
following
requirements
must
be
included
in
each
permit:

(
1)
Cooling
water
intake
structure
requirements.
At
a
minimum,
the
permit
conditions
must
include
the
performance
standards
that
implement
the
applicable
requirements
of
§
125.134(
b)(
2),
(
3),
(
4)
and
(
5);
§
125.134(
c)(
1)
and
(
2);
or
§
125.135.

(
i)
For
a
facility
that
chooses
Track
I,
you
must
review
the
Design
and
Construction
Technology
Plan
required
in
§
125.136(
b)(
3)
to
evaluate
the
suitability
and
feasibility
of
the
technology
proposed
to
minimize
impingement
mortality
and
(
if
applicable
entrainment)
of
all
life
stages
of
fish
and
shellfish.
In
the
first
permit
issued,

you
must
include
a
condition
requiring
the
facility
to
reduce
impingement
mortality
and/
or
entrainment
commensurate
with
the
implementation
of
the
technologies
in
the
permit.
Under
subsequent
permits,
the
Director
must
review
the
performance
of
the
technologies
implemented
and
require
additional
or
different
design
and
construction
technologies,
if
needed
to
minimize
impingement
mortality
and/
or
entrainment
of
all
life
EPA
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Review
Draft 
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2006­­
Deliberative:
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or
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28
stages
of
fish
and
shellfish.
In
addition,
you
must
consider
whether
more
stringent
conditions
are
reasonably
necessary
in
accordance
with
§
125.134(
d).

(
ii)
For
a
fixed
facility
that
chooses
Track
II,
you
must
review
the
information
submitted
with
the
Comprehensive
Demonstration
Study
information
required
in
§

125.136(
c)(
2),
evaluate
the
suitability
of
the
proposed
design
and
construction
technology
and/
or
operational
measures
to
determine
whether
they
will
reduce
both
impingement
mortality
and/
or
entrainment
of
all
life
stages
of
fish
and
shellfish
to
90
percent
or
greater
of
the
reduction
that
could
be
achieved
through
Track
I.
In
addition,
you
must
review
the
Verification
Monitoring
Plan
in
§
125.136(
c)(
2)(
iii)(
C)
and
require
that
the
proposed
monitoring
begin
at
the
start
of
operations
of
the
cooling
water
intake
structure
and
continue
for
a
sufficient
period
of
time
to
demonstrate
that
the
technologies
and
operational
measures
meet
the
requirements
in
§
125.134(
c)(
1).
Under
subsequent
permits,
the
Director
must
review
the
performance
of
the
additional
and
/
or
different
technologies
or
measures
used
and
determine
that
they
reduce
the
level
of
adverse
environmental
impact
from
the
cooling
water
intake
structures
to
a
comparable
level
that
the
facility
would
achieve
were
it
to
implement
the
requirements
of
§
125.134(
b)(
2)
and,

if
applicable,
§
125.134(
b)(
5).

(
iii)
If
a
facility
requests
alternative
requirements
in
accordance
with
§

125.135,
you
must
determine
if
data
specific
to
the
facility
meet
the
requirements
in
§

125.135(
a)
and
include
in
the
permit
requirements
that
are
no
less
stringent
than
justified
by
the
wholly
out
of
proportion
cost
or
the
significant
adverse
impacts
on
local
water
resources
other
than
impingement
or
entrainment,
or
significant
adverse
impacts
on
energy
markets.
EPA
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Review
Draft 
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2006­­
Deliberative:
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or
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29
(
2)
Monitoring
conditions.
At
a
minimum,
the
permit
must
require
the
permittee
to
perform
the
monitoring
required
in
§
125.137.
You
may
modify
the
monitoring
program
when
the
permit
is
reissued
and
during
the
term
of
the
permit
based
on
changes
in
physical
or
biological
conditions
in
the
vicinity
of
the
cooling
water
intake
structure.
The
Director
may
require
continued
monitoring
based
on
the
results
of
the
Verification
Monitoring
Plan
in
§
125.136(
c)(
2)(
iii)(
C).

(
3)
Record
keeping
and
reporting.
At
a
minimum,
the
permit
must
require
the
permittee
to
report
and
keep
records
as
required
by
§
125.138.

3.
Modify
section
125.93
as
follows:

§
125.93
What
special
definitions
apply
to
this
subpart?

*
*
*
*
*

Existing
facility
means
any
facility
that
commenced
construction
as
described
in
40
CFR
122.29(
b)(
4)
on
or
before
January
17,
2002
(
or
[
INSERT
DATE
30
DAYS
AFTER
DATE
OF
PUBLICATION
IN
THE
FEDERAL
REGISTER]
for
an
offshore
oil
and
gas
extraction
facility);
and
any
modification
of,
or
any
addition
of
a
unit
at
such
a
facility
that
does
not
meet
the
definition
of
a
new
facility
at
§
125.83.

*
*
*
*
*
