 ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 62

[EPA-R03-OAR-2007-0345; FRL-                   ]                    

Approval of Plan of the Commonwealth of Pennsylvania;

 Clean Air Mercury Rule

AGENCY:   Environmental Protection Agency (EPA)

ACTION:   Proposed rule

SUMMARY:  EPA is proposing to approve a State Plan submitted by the
Commonwealth of Pennsylvania (Pennsylvania) which addresses the
requirements of EPA’s Clean Air Mercury Rule (CAMR), which EPA
promulgated on May 18, 2005 and subsequently revised on June 9, 2006. 
EPA is proposing to determine that the submitted State Plan fully
implements the CAMR requirements for Pennsylvania.

CAMR requires States to regulate emissions of mercury (Hg) from large
coal-fired electric generating units (EGUs).  CAMR establishes State
budgets for annual EGU mercury emissions and requires States to submit
State Plans that ensure that annual EGU mercury emissions will not
exceed the applicable State budget.  States have the flexibility to
choose which control measures to adopt to achieve the budgets, including
participating in the EPA-administered CAMR cap-and-trade program.  

Pennsylvania chose to adopt a State-specific plan for the control of
mercury emissions from EGUs within the State instead of participating in
the EPA-administered CAMR cap-and-trade program. Pennsylvania’s plan
includes a Pennsylvania-specific mercury control regulation for
coal-fired EGUs and other elements which the State intends to implement
to ensure that Pennsylvania meets its mercury budget.   

Pennsylvania’s state-specific mercury control regulation establishes
annual mercury emission limitations for EGUs as part of a Statewide
nontradable mercury allowance program; sets mercury emissions standards
for EGUs; and includes monitoring, recordkeeping, reporting and other
provisions.

DATES:  Comments must be received on or before [insert date 30 days
after date of publication in the Federal Register].

ADDRESSES:  Submit your comments, identified by Docket ID Number
EPA-R03-OAR-2007-0345, by one of the following methods:

	  HYPERLINK http://www.regulations.gov www.regulations.gov :  Follow
the on-line instructions for submitting comments.

	E-mail:  Campbell.Dave@epa.gov

	Mail:  EPA-R03-OAR-2007-0345, Dave Campbell, Chief, Permits and
Technical Assessment Branch, Mailcode 3AP11, U.S. Environmental
Protection Agency, Region III, 1650 Arch Street, Philadelphia,
Pennsylvania 19103.

	Hand Delivery or Courier:  At the previously-listed EPA Region III
address.  Such deliveries are only accepted during the Regional
Office’s normal hours of operation.  

Instructions:  Direct your comments to Docket ID No.
EPA-R03-OAR-2007-0345.  EPA’s policy is that all comments received
will be included in the public docket without change and may be made
available online at   HYPERLINK http://www.regulations.gov
www.regulations.gov , including any personal information provided,
unless the comment includes information claimed to be Confidential
Business Information (CBI) or other information whose disclosure is
restricted by statute.  Do not submit through   HYPERLINK
http://www.regulations.gov www.regulations.gov  or e-mail, information
that you consider to be CBI or otherwise protected.  The   HYPERLINK
http://www.regulations.gov www.regulations.gov  website is an
“anonymous access” system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment.  If you send an e-mail comment directly to EPA without
going through   HYPERLINK http://www.regulations.gov www.regulations.gov
, your e-mail address will be automatically captured and included as
part of the comment that is placed in the public docket and made
available on the Internet.  If you submit an electronic comment, EPA
recommends that you include your name and other contact information in
the body of your comment and with any disk or CD-ROM you submit.  If EPA
cannot read your comment due to technical difficulties and cannot
contact you for clarification, EPA may not be able to consider your
comment.  Electronic files should avoid the use of special characters
and any form of encryption and should be free of any defects or viruses.
 For additional information about EPA’s public docket visit the EPA
Docket Center homepage at   HYPERLINK
http://www.epa.gov/epahome/dockets.htm
http://www.epa.gov/epahome/dockets.htm .

Docket:  All documents in the electronic docket are listed in the  
HYPERLINK http://docket.epa.gov/rmepub/index.jsp www.regulations.gov 
index.  Although listed in the index, some information is not publicly
available, i.e., CBI or other information whose disclosure is restricted
by statute.  Certain other material, such as copyrighted material, is
not placed on the Internet and will be publicly available only in hard
copy form.  Publicly available docket materials are available either
electronically in   HYPERLINK http://www.regulations.gov
www.regulations.gov  or in hard copy during normal business hours at the
Air Protection Division, U.S. Environmental Protection Agency, Region
III, 1650 Arch Street, Philadelphia, Pennsylvania 19103.  Copies of the
State submittal are also available at the Pennsylvania Department of
Environmental Resources, Bureau of Air Quality Control, P.O. Box 8468,
400 Market Street, Harrisburg, Pennsylvania 17105.

FOR FURTHER INFORMATION CONTACT:  Mr. Ray Chalmers at 215-814-2061, or
by e-mail at chalmers.ray@epa.gov.

SUPPLEMENTARY INFORMATION:

Table of Contents

I.  	What Action Is EPA Proposing to Take?

II.  	What Is the Regulatory History of CAMR?

III. 	What are the General Requirements of CAMR?

IV.  	How Can States Comply With CAMR?  

V.  	Analysis of Pennsylvania’s CAMR State Plan Submittal

		   A.  EPA is Proposing to Find that State Plan Meets All CAMR Budget
Related 	    		         and Other Requirements for Approval

		   B.  Summary of State Plan

VI.		Statutory and Executive Order Reviews

I.  	What Action Is EPA Proposing to Take?

EPA is proposing to approve Pennsylvania’s State Plan for the control
of mercury emissions from coal-fired EGUs, as submitted by Pennsylvania
on November 6, 2006, and as subsequently revised by Pennsylvania on
March 16, 2007.  EPA is proposing to determine that the State Plan will
meet the applicable requirements of CAMR.  In its State Plan,
Pennsylvania would meet CAMR requirements by implementing a
Pennsylvania-specific mercury control regulation for coal-fired EGUs,
rather than through participation in the EPA-administered CAMR
cap-and-trade program. Pennsylvania’s state-specific regulation
establishes annual emission limitations as part of a Statewide mercury
nontradable allowance program; sets mercury emissions standards; and
includes other requirements for the purpose of controlling mercury
emissions from coal-fired EGUs. 

II.  	What is the Regulatory History of CAMR?

CAMR was published by EPA on May 18, 2005 (70 FR 28606, “Standards of
Performance for New and Existing Stationary Sources: Electric Utility
Steam Generating Units; Final Rule”).  In this rule, acting pursuant
to its authority under section 111(d) of the Clean Air Act (CAA), 42
U.S.C. 7411(d), EPA required that all States and the District of
Columbia (all of which are referred to herein as States) meet Statewide
annual budgets limiting mercury emissions from coal-fired EGUs (as
defined in 40 CFR 60.24(h)(8)) under Clean Air Act (CAA) §111(d).  EPA
required all States to submit State Plans with control measures that
ensure that total, annual mercury emissions from the coal-fired EGUs
located in the respective States do not exceed the applicable Statewide
annual EGU mercury budget.  Under CAMR, States may implement and enforce
these reduction requirements by participating in the EPA-administered
cap-and-trade program or by adopting any other effective and enforceable
control measures.

CAA §111(d) requires States, and, along with CAA §301(d) and the
Tribal Air Rule (40 CFR part 49), allows Tribes granted treatment as
States (TAS), to submit State Plans to EPA that implement and enforce
the standards of performance.  CAMR explains what must be included in
State Plans to address the requirements of CAA §111(d).  The State
Plans were due to EPA by November 17, 2006.  Under 40 CFR 60.27(b), the
Administrator will approve or disapprove the State Plans.

III.  	What are the General Requirements of CAMR State Plans?

CAMR establishes Statewide annual EGU mercury emission budgets and is to
be implemented in two Phases.  The first Phase of reductions starts in
2010 and continues through 2017. The second Phase of reductions starts
in 2018 and continues thereafter.  CAMR requires States to implement the
budgets by either:  (1) requiring coal–fired EGUs to participate in
the EPA-administered cap-and-trade program; or (2) adopting other
coal-fired EGU control measures of the respective State’s choosing and
demonstrating that such control measures will result in compliance with
the applicable State annual EGU mercury budget.

Each State Plan must require coal-fired EGUs to comply with the
monitoring, recordkeeping, and reporting provisions of 40 CFR part 75
concerning mercury mass emissions.  Each State Plan must also show that
the State has the legal authority to adopt emission standards and
compliance schedules necessary for attainment and maintenance of the
State’s annual EGU mercury budget and to require the owners and
operators of coal-fired EGUs in the State to meet the monitoring,
recordkeeping, and reporting requirements of 40 CFR part 75. 

IV. 	How Can States Comply With CAMR?

Each State Plan must impose control requirements that the State
demonstrates will limit Statewide annual mercury emissions from new and
existing coal-fired EGUs to the amount of the State’s applicable
annual EGU mercury budget.  States have the flexibility to choose the
type of EGU control measures they will use to meet the requirements of
CAMR.  EPA anticipates that many States will choose to meet the CAMR
requirements by selecting an option that requires EGUs to participate in
the EPA-administered CAMR cap-and-trade program.  EPA also anticipates
that many States may choose to control Statewide annual mercury
emissions for new and existing coal-fired EGUs through an alternative
mechanism other than the EPA-administered CAMR cap-and-trade program. 
Each State that chooses an alternative mechanism must include with its
plan a demonstration that the State Plan will ensure that the State will
meet its assigned State annual EGU mercury emission budget.

A State submitting a State Plan that requires coal-fired EGUs to
participate in the EPA-administered CAMR cap-and-trade program may
either adopt regulations that are substantively identical to the EPA
model mercury trading rule (40 CFR part 60, subpart HHHH) or incorporate
by reference the model rule.  CAMR provides that States may only make
limited changes to the model rule if the States want to participate in
the EPA-administered trading program.  A State Plan may change the model
rule only by altering the allowance allocation provisions to provide for
State-specific allocation of mercury allowances using a methodology
chosen by the State.  A State’s alternative allowance allocation
provisions must meet certain allocation timing requirements and must
ensure that total allocations for each calendar year will not exceed the
State’s annual EGU mercury budget for that year. 

V.  	Analysis of Pennsylvania’s CAMR State Plan Submittal

A.  	EPA is Proposing to Find that Pennsylvania’s State Plan Meets All
CAMR 	Budget Related and Other Requirements for Approval   

In today’s action, EPA is proposing to approve Pennsylvania’s State
Plan as assuring that mercury emissions from the State’s EGUs will not
exceed the levels specified in the CAMR budget for Pennsylvania found at
40 CFR 60.24(h)(3), i.e., 1.779 tons per year for EGU mercury emissions
in Phase 1 and 0.702 tons per year for EGU mercury emissions in Phase 2.
 

The State Plan includes a State-specific regulation which requires
owners or operators of affected new or existing coal-fired EGUs to
comply with a Statewide mercury nontradable allowance program, among
other provisions.  Pennsylvania assured that the regulation would apply
to all of the EGUs which have emissions required to be accounted for
under the CAMR budget for Pennsylvania by using in the regulation a
definition of EGU consistent with the definition specified in CAMR at 40
CFR 60.24(h)(8).  Pennsylvania’s Statewide mercury nontradable
allowance program limits total mercury emissions from EGUs in the State
to the same Phase 1 and Phase 2 amounts as are set forth in the CAMR
budget for Pennsylvania found at 40 CFR 60.24(h)(3).  Pennsylvania’s
mercury nontradeable allowance program requires its Phase 1 reductions
to be achieved starting January 1, 2010, the same date as the Phase 1
reductions are required to be achieved under the CAMR, but requires its
Phase 2 reductions to be achieved starting January 1, 2015, earlier than
the required Phase 2 reductions under CAMR.

Pennsylvania’s State-specific regulation implements the annual limits
on total mercury emissions of EGUs in the State by setting aside for
each EGU an amount of nontradable allowances that comprises the annual
emission limitation (in ounces of mercury emissions) for that EGU.  The
amount set aside may include allowances requested by the owner or
operator and provided from an annual emission limitation supplement
pool.  Further, the regulation states, in § 123.207(p), that an owner
or operator must demonstrate compliance with annual emission limitation
on a unit-by-unit, facility-wide, or system-wide basis and explains, in
§ 123.207(q) and (r), that, under facility-wide or system-wide
compliance, the total annual emissions from the EGUs involved must be
less than the total amount of allowable annual emissions for such EGUs. 
However, the regulation also provides, in §§ 123.207(j)(5) and
123.209, that each ounce of emissions by an EGU, facility, or system, as
applicable, in excess of the amount of allowances set-aside for the EGU,
facility, or system, including any set aside under § 123.209,
constitutes a violation.  EPA interprets § 123.207(j)(5) and (p)
through (r) and § 123.209 as requiring that the total mercury emissions
from an EGU, or from the appropriate group of EGUs where compliance is
on a facility-wide or system-wide basis, determined in accordance with
§§ 123.210-123.215, must not exceed the total amount of allowances set
aside for the EGU or the appropriate group of EGUs, including any
allowances set aside from the annual emission limitation supplement
pool, for the year. 

It should be noted that Pennsylvania’s mercury reduction regulation
also restricts the emissions of mercury from existing and new coal-fired
EGUs through the imposition of emission standards.  These standards,
established in § 123.205, are to be achieved in addition to the
Statewide mercury nontradeable allowance program provisions described
above.  The CAMR does not establish or require similar emissions
standards to be applied to individual emission units.  As discussed
above, CAMR requires a demonstration that the State Plan will ensure
that the State will meet its assigned State annual EGU mercury emission
budget.  Pennsylvania meets this requirement through the establishment
of its Statewide nontradeable mercury allowance program and not through
the emission limitations required by § 123.205.   

In addition, EPA is proposing to approve Pennsylvania’s Plan,
interpreted as discussed below, as meeting the CAMR provision that State
plans must require owners and operators of coal-fired EGUs to meet the
monitoring, recordkeeping, and reporting requirements of 40 CFR part 75.
 The provisions of the regulation included in the State’s plan
concerning monitoring, recordkeeping, and reporting, found at §§
123.210-123.215, are intended to be consistent with the monitoring,
reporting, and recordkeeping requirements for mercury mass emissions in
40 CFR part 75, Subpart I and in EPA’s CAMR model rule, which is based
on and references 40 CFR part 75, Subpart I.  Section 123.210(a) and (b)
states that, for purposes of compliance with 12-month rolling average
mercury emission requirements in § 123.205 and annual mercury mass
emission requirements in § 123.207, the monitoring, reporting, and
recordkeeping requirements of §§ 123.210-123.215 and 139.101, 40 CFR
part 75, Subpart I, and Pennsylvania’s Continuous Source Monitoring
Manual (DEP 274-0300-001) apply.  The manual (at 1), in turn, states
that part 75 applies to “monitoring systems required pursuant to
only” part 75 (e.g., mercury mass monitoring systems) and that
“[a]pproval for compliance with [part 75] must be obtained from”
EPA.  In addition, § 123.210(k) states that an owner or operator may
not use any alternative to a part 75 requirement unless the alternative
is approved by the Administrator in writing.  EPA therefore interprets
the monitoring, reporting, and recordkeeping requirements in
Pennsylvania’s regulation as requiring owners and operators to meet
the requirements of 40 CFR part 75, Subpart I and providing that, if
there is any conflict between those requirements and any other
requirements set forth in §§ 123.210-123.215, the part 75 provisions
will take precedence for the purpose of compliance with annual mercury
mass emission requirements.  

Specifically, Pennsylvania’s regulation includes provisions, in §
123.210(n)(1), allowing discontinuation of use of an approved monitoring
system when the owner or operator is using another certified monitoring
system for the appropriate parameter that is approved by the department
in accordance with §§ 123.210-123.215 and Chapter 139, Subchapter C. 
In light of the other provisions of Pennsylvania’s regulation
discussed above, EPA interprets § 123.210(n)(1) as allowing
discontinuation of an approved monitoring system used for determining
compliance with the annual mercury mass emission requirements in §
123.207 only if another monitoring system for the appropriate parameter
is approved in accordance with part 75, subpart I.  

Further, Pennsylvania’s regulation includes provisions, in §
123.211(a)(5)(iii), requiring the substitution of alternative data in
cases where the State "issues a notice of disapproval of a certification
application or a notice of disapproval of certification status" and
allowing the substitution of either data values as specified in part 75
or "an alternative emission value that is more representative of actual
emissions that occurred during the period.”  In light of the other
provisions of Pennsylvania’s regulation discussed above, EPA
interprets § 123.211(a)(5)(iii) as giving Pennsylvania the authority to
approve substitute data values other than those specified by part 75
only in cases where those data values would be used solely for the
purpose of showing compliance with the mercury emission requirements in
§ 123.205 and not for any data required for the purpose of showing
compliance with the annual mercury mass emission limitation in §
123.207.

Similarly, § 123.212(a) of Pennsylvania’s regulations requires the
use of substitute data based on the Continuous Source Monitoring Manual
if a monitoring system fails to meet certain quality-assurance,
quality-control, or data validation requirements. As discussed above,
the manual requires mercury mass emission monitoring systems to meet the
requirements of part 75.  Further, § 123.212(a) also states that a
mercury mass emission monitoring system failing to meet
quality-assurance or quality-control requirements must use substitute
data under part 75.  EPA therefore interprets § 123.212(a) to require
the use of substitute data as prescribed in part 75 for the purpose of
showing compliance with the annual mercury mass emission limitation in
§ 123.207. 

EPA is also proposing to approve the Plan as meeting the requirements of
CAMR, and also of 40 CFR Subpart B, entitled, “Adoption and Submittal
of State Plans for Designated Facilities,” for a demonstration of
legal authority.  The State’s Plan includes an opinion by the Chief
Counsel of the Pennsylvania Department of Environmental Protection which
demonstrates that the State has the required legal authority to adopt
emission standards and compliance schedules necessary for attainment and
maintenance of the State’s annual EGU mercury budget and to require
the owners and operators of coal-fired EGUs in the State to meet the
monitoring, recordkeeping, and reporting requirements of 40 CFR part 75.


Finally, EPA is proposing to approve the State’s Plan as meeting the
other applicable general requirements for approval under 40 CFR part 60,
subpart B.  The State’s Plan requires owners and operator of affected
coal-fired EGUs in Pennsylvania to comply with emission limitations
(expressed as nontradable mercury allowances) that ensure that total
emissions from the affected coal-fired EGUs in Pennsylvania will not
exceed the CAMR budget for Pennsylvania found at 40 CFR 60.24(h)(3). 
The State’s Plan also requires owners or operators of affected
coal-fired EGUs to achieve mercury emission reductions on a schedule
that is equivalent to, or more rapid than, the schedule under CAMR.  The
State’s Plan includes evidence that three public hearings were held,
and also that public notice of these hearings was provided.  The
State’s Plan also includes an emissions inventory of the State’s
EGUs.   

EPA describes the State’s Plan in more detail below.

B. 	 Summary of State Plan

Pennsylvania’s State Plan includes a State regulation at 25 Pa. Code,
Chapter 123, Standards for Contaminants; Mercury, Annex A. 
Pennsylvania’s state-specific mercury control regulation establishes
annual mercury emission limitations for EGUs as part of a Statewide
mercury nontradable allowance program; sets mercury emissions standards
for EGUs, and includes monitoring, recordkeeping, reporting and other
provisions.  Pennsylvania’s State-specific regulation is applicable to
all of the EGUs which have emissions required to be accounted for under
the CAMR budget for Pennsylvania found at 40 CFR 60.24(h)(3). 
Pennsylvania assured that the regulation would apply to all of the EGUs
which have emissions required to be accounted for under the CAMR budget
for Pennsylvania by using in the regulation a definition of EGU
consistent with the definition specified in CAMR at 40 CFR 60.24(h)(8).

The Statewide mercury nontradable allowance program ensures that the
mercury emissions from new and existing EGUs in the State will not
exceed the CAMR budget for Pennsylvania found at 40 CFR 60.24(h)(3) by
limiting total mercury emissions from EGUs in the State to the same
Phase 1 and Phase 2 amounts as specified in the CAMR budget for the
State. Under the Statewide mercury nontradable mercury allowance program
the total amount of mercury emissions allowed to be emitted from
affected coal-fired EGUs is 56,928 ounces (3,558 lbs or 1.779 tons) per
year during Phase 1 extending from January 1, 2010 through December 31,
2014, and 22,464 ounces (1,404 pounds or 0.702 tons) per year during
Phase 2 starting January 1, 2015 (rather than January 1, 2018, as
specified in the CAMR budget for Pennsylvania found at 40 CFR
60.24(h)(3)) and continuing in subsequent years.

The Statewide mercury nontradable allowance program provides that of the
total of 56,928 ounces per year of mercury emissions available for
emission limitation set-asides during Phase 1, 54,080 ounces will be
allocated to existing affected EGUs and the remaining five (5) percent
will be set-aside for use by new affected EGUs.  The Statewide mercury
nontradable allowance program further provides that of the 22,464 ounces
per year of mercury emissions available for emission limitation
set-asides during Phase 2, 21,790 ounces will be allocated to existing
affected coal-fired EGUs and the remaining three (3) percent will be set
aside for new affected coal-fired EGUs.	

The Statewide mercury nontradable allowance program provides that the
annual nontradeable allowances set aside for owners and operators of new
affected coal-fired EGUs shall be placed in an annual emission
limitation supplement pool administered by the State.  Upon petition by
owners or operators of new affected EGUs, Pennsylvania may grant annual
nontradeable allowances for the new affected coal-fired EGUs from this
annual emission limitation supplement pool. 

Under the Statewide mercury nontradable allowance program owners or
operators of new affected coal-fired EGUs that do not yet have a
baseline heat input will be allocated allowances in accordance with the
requirements of an approved State permit.  The Statewide mercury
nontradable allowance program specifies that after a new affected
coal-fired EGU has commenced operation and completed three control
periods of operation, the EGU will become an existing EGU.  The
Statewide mercury nontradable allowance program provides that a new
affected EGU will continue to receive annual nontradeable mercury
allowances from the new unit set-aside until the new affected EGU is
eligible for annual nontradable mercury allowances allocated from the
set-aside for existing EGUs.  Under the allowance program when a new
affected EGU is eligible to receive annual nontradable mercury
allowances from the set-aside for existing affected EGUs, new maximum
allowance levels for all existing affected EGUs will be established, and
the State will publish these new allocation levels in the Pennsylvania
Bulletin for comment by May 31 of the year that is two years prior to
the affected control period.   

The Statewide mercury nontradable allowance program provides for
determining the maximum number of annual nontradeable allowances set
aside for the owners or operators of all existing affected coal-fired
EGUs, except for owners or operators of existing circulating fluidized
bed (CFB) units, by multiplying the EGU’s baseline heat input fraction
of the State’s total baseline annual heat input from all affected EGUs
by the State’s annual mercury allowance set-aside for existing
affected EGUs for each Phase. 

The Statewide mercury nontradable allowance program provides for
determining the maximum number of annual nontradable mercury allowances
set aside for owners or operators of existing affected CFB units by
multiplying the affected CFB’s baseline heat input fraction of the
State’s total baseline annual heat input for all EGUs by the State’s
Phase 2 annual mercury allowance for existing EGUs. 

The Statewide mercury nontradable allowance program provides that the
State will publish for comment in the Pennsylvania Bulletin, by May 31,
2008, the maximum number of annual nontradeable allowances set aside for
“the owner or operator of each existing affected CFB and EGU other
than CFB for Phase 1 of the Statewide mercury allowance program,” and
that it will publish for comment in the Pennsylvania Bulletin, by May
31, 2013, the maximum number of annual nontradeable allowances set aside
for “the owner or operator of each existing affected CFB and EGU other
than CFB for Phase 2 of the Statewide mercury allowance program.”  

The Statewide mercury nontradable allowance program specifies that the
actual number of annual nontradable mercury allowances awarded to the
owner or operator of the EGU, facility, or system shall be based on the
actual emissions reported to the State.  The Statewide mercury
nontradable allowance program further specifies that the actual number
of annual nontradable mercury allowances awarded to the owner or
operator of the EGU, facility, or system may not exceed the maximum
number of annual nontradeable mercury allowances assigned to the owner
or operator of the EGU, facility, or system, except in cases where the
owner or operator has petitioned for and been granted supplemental
allowances.  Under the Statewide mercury nontradable allowance program
the State could provide such allowances from its annual emission
limitation supplement pool.

The Statewide mercury nontradable allowance program provides that by
March 31 of the year following each reporting year, Pennsylvania will
notify the owner or operator of each affected EGU, facility, or system,
in writing, of the actual number of annual nontradable mercury
allowances awarded to the owner or operator of the affected EGU,
facility, or system for the control period.

The Statewide mercury nontradable allowance program provides that the
owner or operator of one or more affected mercury allowance program EGUs
shall demonstrate compliance either on: 1) a unit-by-unit basis, 2) a
facility-wide basis, or 3) a system-wide basis. Under the Statewide
mercury nontradable allowance program, each ounce of mercury emitted in
excess of the maximum number of annual nontradable mercury allowances
set aside for the owner or operator of an EGU, facility, or system
constitutes a violation of the program and of Pennsylvania’s Air
Pollution Control Act, unless the owner or operator has petitioned for
and has been granted supplemental allowances.

Under the Statewide mercury nontradable allowance program if the actual
emissions of mercury reported to the State for an EGU, facility, or
system are less than the maximum number of annual nontradeable mercury
allowances set aside for the owner or operator of the EGU, facility, or
system, the State will place the unused portion of the allowances in its
annual emission limitation supplement pool.  

The Statewide mercury nontradable allowance program specifies that the
unused portion of annual nontradeable mercury emission allowances
assigned to the owner or operator of an affected EGU, facility, or
system for any year may not be added to the maximum number of annual
nontradable mercury allowances assigned to the owner or operator of the
affected EGU, facility, or system for use in future years.  Under the
Statewide mercury nontradable allowance program annual nontradable
mercury allowances may not be banked for use in future years.

The Statewide mercury nontradable allowance program does not apply to
the owner or operator of an EGU that will be permanently shutdown no
later than December 31, 2009.  The allowance program provides that
annual nontradable mercury allowances will not be set aside for the
owner or operator of an existing affected EGU that is already shut down
or scheduled for shutdown unless the owner or operator of the EGU
obtains a plan approval for the construction of a new EGU, or is on
“standby” as of the effective date of each set-aside Phase.  When a
standby unit is ready for normal operation, the owner or operator may
petition the State for annual nontradeable allowances.  Under the
regulation’s allowance program the State could provide such allowances
from its annual emission limitation supplement pool.

The Statewide mercury nontradable allowance program specifies that an
owner or operator of an existing affected EGU who enters into an
enforceable agreement with the State, by December 31, 2007, to shutdown
that existing EGU and to replace it, by December 31, 2012, with a new
Integrated Gasification Combined Cycle (IGCC) unit, is eligible to
request annual nontradable mercury allowances from the annual emission
limitation supplement pool. 

The Statewide mercury nontradable allowance program provides that the
State may revise the percentage of set-aside used to determine the
number of ounces of mercury set-aside for future annual mercury emission
limitations to accommodate the emissions from new EGUs, or changes in
the calculation of baseline heat input, so that the total number of
ounces of mercury emissions in the Statewide mercury nontradable
allowance program is not exceeded.  

Pennsylvania’s regulation requires owners or operators of EGUs not
only to keep the emissions of their EGUs at or below levels consistent
with their allowances for their EGUs, but also to meet emission limits. 
The emission limits for EGUS vary depending upon whether or not the EGU
qualifies as a new or existing unit and on the type of EGU.  

The regulation defines a new EGU as “[a]n EGU which commenced
construction modification, or reconstruction, as defined under 40 CFR
Part 60 (relating to standards of performance for new stationary
sources), on or after January 30, 2004, and has less than three complete
control periods of heat input data as of December 31 of the preceding
control period.”  The regulation defines an existing EGU as “[a]n
EGU which commenced construction, modification or reconstruction on or
before January 30, 2004, or which has three complete control periods of
heat input data as of December 31 or the preceding control period.”   

For new EGUs, Pennsylvania’s regulation requires the owner or operator
to comply at the commencement of operation on a rolling 12 month basis
with one of the following standards:

(1)  Pulverized Coal Fired (PCF) EGU.  The owner or operator of a PCF
EGU shall comply with either or the following:

(i)  A mercury emission standard of 0.011 pound of mercury per
Gigawatt-hour (GWh).

(ii)  A minimum 90% control of total mercury as measured from the
mercury content in the coal, either as fired or as approved in writing
by Pennsylvania.

(2)  Circulating Fluidized Bed (CFB) EGU.  The owner or operator of a
CFB EGU shall comply with the following applicable provisions:

(i)  CFB EGUs burning 100% coal refuse as the only solid fossil fuel
shall comply with either of the following:

(A) A mercury emission standard of 0.0096 pound of mercury per GWh.

(B)  A minimum 95% control of total mercury as measured from the mercury
content in the coal refuse, either as fired or as approved in writing by
the State.

(ii)  CFB EGU’s burning 100% coal as the only solid fossil fuel shall
comply with either of the following:

(A) A mercury emission standard of 0.011 pound of mercury per GWh.

(B)  A minimum 90% control of total mercury as measured from the mercury
content in the coal refuse, either as fired or as approved in writing by
the State.

(iii)  CFB EGUs burning multiple fuels shall comply with a prorated
emission standard based on the percentage of heat input from the coal
and the percentage of heat input from the coal refuse.

(3)  Integrated Gasification Combined Cycle (IGCC) EGU.  The owner or
operator of an IGCC EGU shall comply with one of the following:

(i)  A mercury emission standard of 0.0048 pound of mercury per GWh.

(ii)  A minimum 95% control of total mercury as measured from the
mercury content in the coal, either as processed or as approved in
writing by the State.

Pennsylvania’s regulation notifies owners or operators of new EGUs
that they are also required to comply with the New Source Performance
Standards (NSPS) found at 40 CFR Part 60, Subpart Da.  In addition, the
regulation indicates that the State’s emission standards will serve as
the baseline the State uses for review and approval of case-by-case best
available technology determinations in accordance with the State’s
requirements relating to construction, modification, reactivation and
operation of sources.

For existing EGUs, the regulation requires the owner or operator to
comply on a rolling 12-month basis with one of the following standards:

(1)  Phase 1 – Effective from January 1, 2010 through December 31,
2014:

(i)  PCF EGU – The owner or operator of a PCF shall comply with one of
the following:

(A)  A mercury emission standard of 0.024 pound of mercury per GWh.

(B)  A minimum 80% control of total mercury as measured from the mercury
content in the coal, either as fired or as approved in writing by the
State. 

(ii)  CFB EGU – The owner or operator of a CFB burning coal refuse
shall comply with one of the following:

(A)  A mercury emission standard of 0.0096 pound of mercury per GWh.

(B)  A minimum 95% control of total mercury as measured from the mercury
content in the coal refuse, either as fired or as approved in writing by
the State.

(2)  Phase 2 – Effective beginning January 1, 2015, and each
subsequent year:

(i)  PCF EGU – The owner or operator of a PCF shall comply with one of
the following:

(A)  A mercury emission standard of 0.012 pound of mercury per GWh.

(B)  A minimum 90% control of total mercury as measured from the mercury
content in the coal, either as fired or as approved in writing by the
State.

(ii)  CFB EGU – The owner or operator of a CFB burning coal refuse
shall comply with one of the following:

(A)  A mercury emission standard of 0.0096 pound of mercury per GWh.

(B)  A minimum 95% control of total mercury as measured from the mercury
content in the coal refuse, either as fired or as approved in writing by
the State.

The regulation also provides that the owner or operator of an EGU may
request, in writing, credit for the mercury removal efficiency resulting
from the pretreatment of coal or coal refuse towards the minimum
specified percent control efficiency of the total mercury requirements.

The regulation provides that the owner or operator of one or more EGUs
subject to the mercury emissions standards shall demonstrate compliance
on:  1) a unit-by-unit basis, or 2) a facility-wide basis.

Pennsylvania’s regulation requires owners or operators of coal-fired
EGUs to comply with the monitoring, recordkeeping, and reporting
provisions of 40 CFR part 75 concerning mercury mass emissions.  The
regulation provides that the monitoring, recordkeeping, and reporting
requirements of 40 CFR part 75 Subpart I (relating to mercury mass
emission provisions) apply, as well as other monitoring, recordkeeping
and reporting provisions which are Pennsylvania-specific, as discussed
in detail above.  The regulation further indicates that Pennsylvania has
adopted by reference the provisions entitled “Mercury Designated
Representative for Mercury Budget Sources,” found in EPA’s model
rule, 40 CFR part 60, Subpart HHHH, at sections 60.4110 through 60.4114.
 In addition, the regulation provides that, for purposes of complying
with its requirements, the definitions in 40 CFR 72.2 shall apply.

The regulation also includes provisions pertaining to initial
certification and recertification procedures for emissions reporting,
provisions for out-of-control periods for emissions monitors, provisions
pertaining to monitoring of gross electrical output, provisions
pertaining to coal sampling and analysis for input mercury levels, and
provisions pertaining to general recordkeeping and reporting.

The regulation provides that owners or operators of new or existing
affected EGUs will be issued a State plan approval or operating permit
(including Title V permits) in which the applicable mercury control
requirements will be specified.  The regulation specifies that these
plan approvals or permits will be issued before the later of January 1,
2010 or the date on which the affected EGU commences operation.

The regulation further provides, at § 123.206, that the State’s
Department of Environmental Protection (the Department) “may approve
in a plan approval or operating permit, or both, an alternate mercury
emission standard or compliance schedule, or both, if the owner or
operator of an EGU subject to the emission standards of § 123.205
demonstrates in writing to the Department’s satisfaction that the
mercury reduction requirements are economically or technologically
infeasible.  The Department’s approval of such an alternative emission
standard or compliance schedule does not relieve the owner or operator
of the EGU from complying with the other requirements of §§
123.201-123.205 and 123.207-123.215.”  

The State Plan also contains required non-regulatory elements.  The
State Plan includes an inventory of the existing designated coal-fired
EGUs in the State, and provides data regarding the mercury emissions of
these EGUs.  The Plan also provides documentation of the State’s
public participation process, including copies of public notices
announcing public hearings and the opportunity to comment, a
certification that three public hearings were held, and a summary of
comments received by the State and of the State’s responses. Further,
the Plan includes a legal opinion of the Chief Counsel of the
Pennsylvania Department of Environmental Protection which demonstrates
that the State has the legal authority to adopt emission standards and
compliance schedules necessary for attainment and maintenance of the
State’s annual EGU mercury budget and to require the owners and
operators of coal-fired EGUs in the State to meet the monitoring,
recordkeeping, and reporting requirements of 40 CFR part 75. 

 

VI.  	Statutory and Executive Order Reviews

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
proposed action is not a “significant regulatory action” and
therefore is not subject to review by the Office of Management and
Budget.  For this reason, this action is also not subject to Executive
Order 13211, “Actions Concerning Regulations That Significantly Affect
Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). 
This action merely proposes to approve State law as meeting Federal
requirements and would impose no additional requirements beyond those
imposed by State law.  Accordingly, the Administrator certifies that
this proposed rule would not have a significant economic impact on a
substantial number of small entities under the Regulatory Flexibility
Act (5 U.S.C. 601 et seq.).  Because this action proposes to approve
pre-existing requirements under State law and would not impose any
additional enforceable duty beyond that required by State law, it does
not contain any unfunded mandate or significantly or uniquely affect
small governments, as described in the Unfunded Mandates Reform Act of
1995 (Public Law 104-4).

This proposal also does not have Tribal implications because it would
not have a substantial direct effect on one or more Indian tribes, 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 by Executive Order 13175 (65
FR 67249, November 9, 2000). 

This proposed action also does not have Federalism implications because
it would not have substantial direct effects on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government, as specified in Executive Order 13132 (64 FR 43255, August
10, 1999).  This action merely proposes to approve a State rule
implementing a Federal standard.  It does not alter the relationship or
the distribution of power and responsibilities established in the CAA. 
This proposed rule also is not subject to Executive Order 13045
“Protection of Children from Environmental Health Risks and Safety
Risks” (62 FR 19885, April 23, 1997), because it approves a state rule
implementing a Federal standard.  

Executive Order 12898, “Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations,” requires
Federal agencies to consider the impact of programs, policies, and
activities on minority populations and low-income populations.  EPA
guidance states that EPA is to assess whether minority or low-income
populations face risk or a rate of exposure to hazards that is
significant and that “appreciably exceed[s] or is likely to
appreciably exceed the risk or rate to the general population or to the
appropriate comparison group.”  (EPA, 1998)  Because this rule merely
proposes to approve a state rule implementing the Federal standard
established by CAMR, EPA lacks the discretionary authority to modify
today’s regulatory decision on the basis of environmental justice
considerations.  However, EPA has already considered the impact of CAMR,
including this Federal standard, on minority and low-income populations.
 In the context of EPA’s CAMR published in the Federal Register on May
18, 2005, in accordance with EO 12898, the Agency has considered whether
CAMR may have disproportionate negative impacts on minority or low
income populations and determined it would not.

In reviewing State Plan submissions, EPA’s role is to approve State
choices, provided that they meet the criteria of the CAA.  In this
context, in the absence of a prior existing requirement for the State to
use voluntary consensus standards (VCS), EPA has no authority to
disapprove a State Plan for failure to use VCS.  It would thus be
inconsistent with applicable law for EPA, when it reviews a State Plan
submission, to use VCS in place of a State Plan submission that
otherwise satisfies the provisions of the CAA.  Thus, the requirements
of section 12(d) of the National Technology Transfer and Advancement Act
of 1995 (15 U.S.C. 272 note) do not apply.  This rule 

proposing to approve Pennsylvania’s State Plan submittal for the CAMR
requirements would not impose an information collection burden under the
provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et
seq.).

List of Subjects

Environmental protection, Air pollution control, Electric utilities,
Intergovernmental relations, Mercury, Reporting and recordkeeping
requirements.

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

September 4, 2007				/s/

___________________________      ____________________________

Dated:                         			Donald S. Welsh, 

					Regional Administrator,

                         Region III.

  EPA notes that Pennsylvania’s definitions of “existing EGU” and
“new EGU” overlap in that an EGU that   “commenced construction,
modification, or reconstruction” on January 1, 2004 would be covered
by both definitions.  EPA believes that this technical problem with the
rule will likely have no practical consequence since it is unlikely that
there will be such a unit and Pennsylvania can resolve this if and when
a problem arises.  Therefore, EPA’s proposed approval includes these
definitions.

   EPA notes that § 123.210(j) incorrectly references “subsections
(f) –(h)”  (rather than just subsection (h)) and that the provision
only makes sense where an certified monitoring system already exists and
a new stack or flue or new control device is added, which is addressed
only in subsection (h).  In any event, that § 123.210(j) is based on a
provision in § 60.4170(c)(2) that EPA has proposed to remove.  See 71
FR 77100, 77117 (2006).  EPA interprets § 123.210(j) to apply only with
regard to subsection (h), and, if EPA finalizes removal of §
60.4170(c)(2), § 123.210(j ) will no longer apply at all for the
purpose of compliance with the annual mercury mass emission limitation
under § 123.207.  

  U.S. Environmental Protection Agency, 1998.  Guidance for
Incorporating Environmental Justice Concerns in EPA’s NEPA Compliance
Analyses.  Office of Federal Activities, Washington, D.C., April, 1998.

 PAGE   

 PAGE   29 

