

[Federal Register: February 10, 2006 (Volume 71, Number 28)]
[Proposed Rules]               
[Page 6988-6991]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10fe06-13]                         

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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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[[Page 6988]]



ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2004-KY-0004-200603; FRL-8031-2]

 
Approval and Promulgation of Implementation Plans; Kentucky 
Prevention of Significant Deterioration and Nonattainment New Source 
Review

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: EPA is proposing to approve revisions to the Kentucky State 
Implementation Plan (SIP) submitted by the Commonwealth of Kentucky on 
September 2, 2004. The proposed revisions modify Kentucky's Prevention 
of Significant Deterioration (PSD) and Nonattainment New Source Review 
(NNSR) regulations in the SIP to address changes to the federal NSR 
regulations, which were promulgated by EPA on December 31, 2002 (67 FR 
80186) and reconsidered with minor changes on November 7, 2003 (68 FR 
63021) (collectively, these two final actions are called the ``2002 NSR 
Reform Rules''). Together, the PSD and NNSR programs are commonly 
referred to as the ``NSR programs.'' EPA's 2002 NSR Reform Rules, 
proposed for inclusion in the Kentucky SIP, include provisions for 
baseline emissions calculations, an actual-to-projected-actual 
methodology for calculating emissions changes, options for plantwide 
applicability limits, recordkeeping and reporting requirements, and a 
significance threshold for ozone depleting substances.

DATES: Comments must be received on or before March 13, 2006.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2004-KY-0004, by one of the following methods:
    1. http://www.regulations.gov: Follow the on-line instructions for 

submitting comments.
    2. E-mail: fortin.kelly@epa.gov.
    3. Fax: 404-562-9019.
    4. Mail: (Docket ID No. EPA-R04-OAR-2004-KY-004), Air Planning 
Branch, Air, Pesticides and Toxics Management Division, U.S. 
Environmental Protection Agency, Region 4, 61 Forsyth Street, SW., 
Atlanta, Georgia 30303-8960.
    5. Hand Delivery: Deliver your comments to: Ms. Kelly Fortin, Air 
Planning Branch, Air, Pesticides and Toxics Management Division, 12th 
floor, U.S. Environmental Protection Agency Region 4, 61 Forsyth Street 
SW., Atlanta, Georgia 30303-8960. Such deliveries are only accepted 
during the Regional Office's normal hours of operation. The Regional 
Office's official hours of business are Monday through Friday, 8:30 to 
4:30, excluding Federal holidays.
    Instructions: Direct your comments to Docket ID No. EPA-R04-OAR-
2004-KY-0004. EPA's policy is that all comments received will be 
included in the public docket without change and may be made available 
online at http://www.regulations.gov, including any personal 

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

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

automatically captured and included as part of the comment that is 
placed in the public docket and made available on the Internet. If you 
submit an electronic comment, EPA recommends that you include your name 
and other contact information in the body of your comment and with any 
disk or CD-ROM you submit. If EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment. Electronic files should avoid 
the use of special characters, any form of encryption, and be free of 
any defects or viruses. For additional information about EPA's public 
docket visit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm
.

    Docket: All documents in the docket are listed in the http://www.regulations.gov
 index. Although listed in the index, some 

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

Regulatory Development Section, Air Planning Branch, Air, Pesticides & 
Toxics Management Division, U.S. Environmental Protection Agency, 
Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303-8960. EPA 
requests that if at all possible, you contact the person listed in the 
FOR FURTHER INFORMATION CONTACT section to schedule your inspection. 
The Regional Office's official business hours are Monday through 
Friday, 8:30 to 4:30, excluding federal holidays.

FOR FURTHER INFORMATION CONTACT: For information regarding the Kentucky 
State Implementation Plan, contact Mr. Sean Lakeman, Regulatory 
Development Section, Air Planning Branch, Air, Pesticides and Toxics 
Management Division, U.S. Environmental Protection Agency Region 4, 61 
Forsyth Street SW., Atlanta, Georgia 30303-8960. Telephone number: 
(404) 562-9043; e-mail address: lakeman.sean@epa.gov. For information 
regarding New Source Review, contact Ms. Kelly Fortin, Air Permits 
Section, at the same address above. Telephone number: (404) 562-9117; 
e-mail address: fortin.kelly@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document, references to 
``EPA,'' ``we,'' ``us,'' or ``our,'' are intended to mean the 
Environmental Protection Agency. The supplementary information is 
arranged as follows:

I. What Action Is EPA Proposing to Take?
II. What is the Background for this Action?
III. What is EPA's Analysis of Kentucky's NSR Rule Revisions?
    a. Definitions for Chapter 51; 401 KAR 51:001

[[Page 6989]]

    B. Prevention of Significant Deterioration of Air Quality; 401 
KAR 51:017
    C. Review of New Sources in or Impacting Upon Nonattainment 
Areas; 401 KAR 51:052
IV. What Action is EPA Taking Today?
V. Statutory and Executive Order Reviews.

I. What Action Is EPA Proposing To Take?

    On September 2, 2004, the Commonwealth of Kentucky, through the 
Kentucky Department of Environmental Protection (KDEP), submitted 
revisions to the Kentucky State Implementation Plan (SIP). The 
submittal consists of revisions to three regulations that are already 
part of the Kentucky SIP. The affected regulations are: 401 Kentucky 
Administrative Regulations (KAR) 51:001, ``Definitions for 401 KAR 
Chapter 51;'' 401 KAR 51:017, ``Prevention of Significant Deterioration 
of Air Quality;'' and 401 KAR 51:052, ``Review of New Sources in or 
Impacting upon Nonattainment Areas.'' The revisions were made to update 
the Kentucky NSR programs to make them consistent with changes to the 
Federal NSR regulations published on December 31, 2002 (67 FR 80186) 
and November 7, 2003 (68 FR 63021). These two EPA rulemakings are 
commonly referred to as the ``2002 NSR Reform Rules.''
    In a letter to EPA dated August 23, 2005, Kentucky requested to 
amend the September 2, 2004, SIP submittal in light of the decision 
issued by the U.S. Circuit Court of Appeals for the District of 
Columbia (DC Circuit Court) on June 24, 2005. The June 24, 2005, 
decision is discussed in further detail below. Kentucky requested that 
the portion of the Kentucky SIP revision related to the EPA rules that 
were vacated by the DC Circuit Court not be approved into the SIP, 
namely Sections 20, 21, and 22 of 401 KAR 51:017, Sections 11, 12, and 
13 of 401 KAR 51:052, and definitions (38) and (188) in Section 1 of 
401 KAR 51:001. EPA is therefore now proposing to approve the SIP 
submitted by KDEP on September 2, 2004, as amended on August 23, 2005.

II. What Is the Background for This Action?

    On December 31, 2002, EPA published final rule changes to 40 Code 
of Federal Regulations (CFR) parts 51 and 52, regarding the Clean Air 
Act's PSD and Nonattainment New Source Review (NNSR) programs. 67 FR 
80186. On November 7, 2003, EPA published a notice of final action on 
the reconsideration of the December 31, 2002 final rule changes. 68 FR 
63021. In that November 7th final action, EPA added the definition of 
``replacement unit,'' and clarified an issue regarding plantwide 
applicability limitations (PALs). The December 31, 2002 and the 
November 7, 2003, final actions, are collectively referred to as the 
``2002 NSR Reform Rules.'' The purpose of today's action is to propose 
approval of the SIP submittal from the Commonwealth of Kentucky, which 
includes EPA's 2002 NSR Reform Rules.
    The 2002 NSR Reform Rules are part of EPA's implementation of Parts 
C and D of title I of the Clean Air Act (CAA or Act), 42 U.S.C. 7470-
7515. Part C of title I of the CAA, 42 U.S.C. 7470-7492, is the PSD 
program, which applies in areas that meet the National Ambient Air 
Quality Standards (NAAQS)--``attainment'' areas--as well as in areas 
for which there is insufficient information to determine whether the 
area meets the NAAQS--``unclassifiable'' areas. Part D of title I of 
the CAA, 42 U.S.C. 7501-7515, is the NNSR program, which applies in 
areas that are not in attainment of the NAAQS--``nonattainment areas.'' 
Collectively, the PSD and NNSR programs are referred to as the ``New 
Source Review'' or NSR programs. EPA regulations implementing these 
programs are contained in 40 CFR 51.165, 51.166, 52.21, 52.24, and part 
51, appendix S.
    The CAA's NSR programs are preconstruction review and permitting 
programs applicable to new and modified stationary sources of air 
pollutants regulated under the CAA. The NSR programs of the CAA include 
a combination of air quality planning and air pollution control 
technology program requirements. Briefly, section 109 of the CAA, 42 
U.S.C. 7409, requires EPA to promulgate primary NAAQS to protect public 
health and secondary NAAQS to protect public welfare. Once EPA sets 
those standards, states must develop, adopt, and submit to EPA for 
approval, a State Implementation Plan (SIP) that contains emissions 
limitations and other control measures to attain and maintain the 
NAAQS. Each SIP is required to contain a preconstruction review program 
for the construction and modification of any stationary source of air 
pollution to assure that the NAAQS are achieved and maintained; to 
protect areas of clean air; to protect air quality related values (such 
as visibility) in national parks and other areas; to assure that 
appropriate emissions controls are applied; to maximize opportunities 
for economic development consistent with the preservation of clean air 
resources; and to ensure that any decision to increase air pollution is 
made only after full public consideration of the consequences of the 
decision.
    The 2002 NSR Reform Rules made changes to five areas of the NSR 
programs. In summary, the 2002 Rules: (1) Provide a new method for 
determining baseline actual emissions; (2) adopt an actual-to-
projected-actual methodology for determining whether a major 
modification has occurred; (3) allow major stationary sources to comply 
with plant-wide applicability limits to avoid having a significant 
emissions increase that triggers the requirements of the major NSR 
program; (4) provide a new applicability provision for emissions units 
that are designated clean units; and (5) exclude pollution control 
projects (PCPs) from the definition of ``physical change or change in 
the method of operation.'' On November 7, 2003, EPA published a notice 
of final action on its reconsideration of the 2002 NSR Reform Rules (68 
FR 63021), which added a definition for ``replacement unit'' and 
clarified an issue regarding PALs. For additional information on the 
2002 NSR Reform Rules, see 67 FR 80186 (December 31, 2002), and http://www.epa.gov/nsr
.

    After the 2002 NSR Reform Rules were finalized and effective (March 
3, 2003), various petitioners challenged numerous aspects of the 2002 
NSR Reform Rules, along with portions of EPA's 1980 NSR Rules (45 FR 
5276, August 7, 1980). On June 24, 2005, the DC Circuit Court issued a 
decision on the challenges to the 2002 NSR Reform Rules. New York v. 
United States, 413 F.3d 3 (DC Cir. 2005). In summary, the DC Circuit 
Court vacated portions of the Rules pertaining to clean units and 
pollution control projects, remanded a portion of the Rules regarding 
recordkeeping, e.g., 40 CFR 52.21(r)(6) and 40 CFR 51.166(r)(6), and 
either upheld or did not comment on the other provisions included as 
part of the 2002 NSR Reform Rules. EPA has not yet responded to the 
Court's remand regarding the recordkeeping provisions. Today's action 
is consistent with the decision of the DC Circuit Court because 
Kentucky's submittal does not include any portions of the 2002 NSR 
Reform Rules that were vacated as part of the June 2005, decision.
    The 2002 NSR Reform Rules require that state agencies adopt and 
submit revisions to their SIP permitting programs implementing the 
minimum program elements of the 2002 NSR Reform Rules no later than 
January 2, 2006. (Consistent with changes to 40 CFR 51.166(a)(6)(i), 
state agencies are now required to adopt and submit SIP revisions 
within three years after new amendments are published in the Federal 
Register.) State agencies may

[[Page 6990]]

meet the requirements of 40 CFR part 51, and the 2002 NSR Reform Rules, 
with different but equivalent regulations. However, if a state decides 
not to implement any of the new applicability provisions, that state is 
required to demonstrate that its existing program is at least as 
stringent as the federal program.
    On September 2, 2004, the Commonwealth of Kentucky submitted a SIP 
revision for the purpose of revising the Commonwealth's NSR permitting 
provisions. These changes were made primarily to adopt EPA's 2002 NSR 
Reform Rules. As discussed in further detail below, EPA believes the 
revisions contained in the Kentucky submittal are approvable for 
inclusion into the Kentucky SIP.

III. What Is EPA's Analysis of Kentucky's NSR Rule Revisions?

    Kentucky currently has an approved NSR program for new and modified 
sources. Today, EPA is proposing to approve revisions to Kentucky's 
existing NSR program in the SIP. These proposed revisions became state-
effective on July 14, 2004, and were submitted to EPA on September 2, 
2004. Copies of the revised rules, as well as the State's Technical 
Support Document (TSD), can be obtained from the Docket, as discussed 
in the ``Docket'' section above. A discussion of the specific changes 
to Kentucky's rule, proposed for inclusion in the SIP, follows.

A. Definitions for 401 KAR Chapter 51; 401 KAR 51:001

    Regulation 401 KAR 51:001 defines the terms used in Chapter 51 of 
the Kentucky Administrative Regulations. The amendments to section 
51:001 provide the definitions of terms used in 401 KAR 51:017 and 401 
KAR 51:052, which were changed to include the 2002 NSR Reform Rules, as 
discussed above. Specifically, the revisions include new or revised 
definitions for terms such as ``actual emissions,'' ``actual PALs,'' 
``allowable emissions,'' ``baseline actual emissions,'' and ``major 
modification.'' The Kentucky definitions correspond with the federal 
definitions. Furthermore, the introductory paragraph of Chapter 51:001 
states that the definitions ``are not more stringent or otherwise 
different than the corresponding federal definitions.''
    Kentucky's revisions to Chapter 51:017 contain a minor provision 
that is different from the existing federal rule found in 40 CFR 
51.166(b)(23), which defines significance levels for various 
pollutants. Kentucky's definition of ``significance'' (definition 221), 
includes a significance threshold for ozone depleting substances (ODS) 
of 100 tons per year (tpy). This definition, as applied by 401 KAR 
51:017, has the effect of requiring that facilities with emissions or 
net emissions increases greater than or equal to 100 tpy of ODS obtain 
a major source permit. The current Federal rule (51.166(b)(23)(ii)) 
does not contain a specific threshold for ODS. In 1996, however, EPA 
proposed a 100 tpy threshold for ODS. See 61 FR 38250, July 23, 1996. 
Based on the rationale provided in the 1996 proposal, EPA believes that 
it is reasonable for Kentucky to adopt this threshold. If EPA issues a 
final rule that establishes a threshold for ODS that is different from 
the one proposed in 1996, Kentucky will have the obligation to amend 
its rule. Additional information regarding significance threshold 
levels for ODS can be found in the Docket for this action. General 
information about ODS is available on the EPA Web site at: http://www.epa.gov/ozone/index.html
.

    EPA performed a line by line review of the Kentucky definitions and 
found them to be consistent with the 2002 NSR Reform Rules and other 
federal requirements set forth in 40 CFR 51 subpart I. Per Kentucky's 
request, as discussed above, EPA is not proposing to approve the 
definition of ``clean unit'' or the definition of ``pollution control 
project'' into the Kentucky SIP.

B. Prevention of Significant Deterioration of Air Quality; 401 KAR 
51:017

    Kentucky regulation 401 KAR 51:017 contains the preconstruction 
review program that provides for the prevention of significant 
deterioration of ambient air quality as required under Part C of title 
I of the Clean Air Act. The program applies to major stationary sources 
or modifications constructing in areas that are designated as 
attainment or unclassifiable with respect to the NAAQS. Kentucky's PSD 
program was originally approved into the SIP by EPA on November 6, 
1989, and has been revised several times.
    The current revisions to 401 KAR 51:017, which EPA is proposing to 
approve into the SIP, were provided to update the existing provisions 
to be consistent with the current Federal PSD rules, including the 2002 
NSR Reform Rules. These revisions address baseline actual emissions, 
actual-to projected actual applicability tests, and PALs. Definitions 
previously contained in this section were moved to 401 KAR 51:001, 
``Definitions for 401 KAR Chapter 51.'' 401 KAR 51:017 does not 
incorporate the portions of the Federal rules that were recently 
vacated by the DC Circuit Court, including the clean unit provisions, 
the pollution control projects exclusion, and equipment replacement 
provision which was promulgated shortly after the 2002 NSR Reform 
Rules. As noted earlier, EPA has not yet responded to the DC Circuit 
Court's remand of the recordkeeping provisions of EPA's 2002 NSR Reform 
Rules. Kentucky's rule contains recordkeeping requirements that are 
substantially the same as the remanded Federal rule. While final action 
by EPA with regard to the remand may require EPA to take further action 
on this portion of Kentucky's rules, at this time, the rules are the 
same as existing Federal law.
    The requirements included in Kentucky's PSD program are 
substantively the same as the corresponding federal provisions. The 
Kentucky rules have been formatted to conform to Kentucky rule drafting 
standards (Kentucky Revised Standards Chapter 13A), but in substantive 
content the rules are the same as the Federal rules. As part of its 
review of the Kentucky SIP submittal, EPA performed a line-by-line 
review of the proposed revisions and has determined that they are 
consistent with the program requirements for the preparation, adoption 
and submittal of implementation plans for the Prevention of Significant 
Deterioration of Air Quality, set forth at 40 CFR 51.166.

C. Review of New Resources in or Impacting Upon Nonattainment Areas; 
401 KAR 51:052

    Kentucky's permitting requirements for major sources in or 
impacting upon non-attainment areas are set forth at 401 KAR 51:052 
(NNSR program). The Kentucky NNSR program was originally approved into 
the Kentucky SIP on January 25, 1980 (with subsequent amendments) and 
applies to the construction and modification of any major stationary 
source of air pollution in a nonattainment area, as required by Part D 
of title I of the CAA. To receive approval to construct, a source that 
is subject to this regulation must show that it will not cause a net 
increase in pollution, will not create a delay in meting the NAAQS, and 
that the source will install and use control technology that achieves 
the lowest achievable emissions rate.
    The revisions to this regulation, which EPA is proposing to approve 
into the SIP, update the existing provisions to be consistent with the 
current Federal nonattainment rule, including the 2002 NSR Reform 
Rules. These revisions address baseline actual emissions, actual-to-
projected-actual applicability tests, and PALs. Definitions previously

[[Page 6991]]

contained in this seciton were moved to 401 KAR 51:001, ``Definitions 
for 401 KAR Chapter 51.'' The rule does not incorporate the portions of 
the Federal rules that were recently vacated by the DC Circuit Court, 
including the clean unit provisions, the pollution control projects 
exclusion, and the equipment replacement provision, which was 
promulgated shortly after the 2002 NSR Reform Rules.
    The revisions included in Kentucky's NNSR program are substantively 
the same as the 2002 NSR Reform Rules. The Kentucky Rules have been 
formatted to conform to Kentucky rule drafting standards (KRS Chapter 
13A), but in substantive content the rules are the same as the Federal 
rules. As part of its review of the Kentucky submittal, EPA performed a 
line-by-line review of the proposed revisions and has determined that 
they are consistent with the program requirements for the preparation, 
adoption and submittal of implementation plans for New Source Review, 
set forth at 40 CFR 51.165.

IV. What Action Is EPA Proposing To Take?

    EPA is proposing to approve revisions to the Kentucky SIP (Kentucky 
regulations, 401 KAR 51:01, 401 KAR 51:017, and 401 KAR 51:052) 
submitted by the Common wealth of Kentucky on September 2, 2004, and 
amended on August 23, 2005. EPA proposed to take no action on the 
following provisions of the Kentucky regulations, which include 
portions of the 2002 NSR Reform Rules that were vacated by the D.C. 
Circuit Court: Sections 20, 21, and 22 of 401 KAR 51:017, Sections 11, 
12, and 13 of 401 KAR 51:052, and definitions (38) and (188) in Section 
1 of 401 KAR 51:001.

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 
proposed action merely proposes to approve state law as meeting Federal 
requirements and imposes no additional requirements beyond those 
imposed by state law. Accordingly, the Administrator certifies that 
this proposed rule will 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 rule proposes to approve pre-
existing requirements under state law and does 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 (Pub. L. 104-4).
    This proposed rule also does not have tribal implications because 
it will 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 action also does not 
have Federalism implications because it does 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, and does not alter the relationship or the distribution of 
power and responsibilities established in the Clean Air Act. 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 is not economically significant.
    In reviewing SIP submissions, EPA's role is to approve state 
choices, provided that they meet the criteria of the Clear Air Act. 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 SIP submission for failure to use VCS. It would thus be 
inconsistent with applicable law for EPA, when it reviews a SIP 
submission, to use VCS in place of a SIP submission that otherwise 
satisfies the provisions of the Clean Air Act. 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 proposed rule does 
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 in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate 
matter, Reporting and recordkeeping requirements, Sulfur oxides, 
Volatile organic compounds.

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

    Dated: February 3, 2006.
J.I. Palmer Jr.,
Regional Administrator, Region 4.
[FR Doc. 06-1318 Filed 2-9-06; 8:45 am]

BILLING CODE 6560-50-M
