[Federal Register Volume 83, Number 218 (Friday, November 9, 2018)]
[Proposed Rules]
[Pages 56002-56015]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-24582]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2017-0625; FRL-9986-36-Region 4]


Air Plan Approval; Kentucky; Attainment Plan for Jefferson County 
SO2 Nonattainment Area

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
approve the State Implementation Plan (SIP) revision, submitted under a 
cover letter dated June 23, 2017, by the Commonwealth of Kentucky, 
through the Kentucky Division for Air Quality (KDAQ) on behalf of the 
Louisville Metro Air Pollution Control District (District or Jefferson 
County) to EPA, for attaining the 1-hour sulfur dioxide 
(SO2) primary national ambient air quality standard (NAAQS) 
for the Jefferson County SO2 nonattainment area (hereafter 
referred to as the ``Jefferson County nonattainment area,'' 
``nonattainment Area'' or ``Area''). The Jefferson County nonattainment 
area is comprised of a portion of Jefferson County in Kentucky 
surrounding the Louisville Gas and Electric Mill Creek Electric 
Generating Station (hereafter referred to as ``Mill Creek'' or 
``LG&E''). This plan (hereafter called a ``nonattainment plan'' or 
``SIP'' or ``attainment SIP'') includes Kentucky's attainment 
demonstration and other elements required under the Clean Air Act (CAA 
or Act). In addition to an attainment demonstration, the plan addresses 
the requirement for meeting reasonable further progress (RFP) toward 
attainment of the NAAQS, reasonably available control measures and 
reasonably available control technology (RACM/RACT), base-year and 
projection-year emissions inventories, enforceable emission limits, 
nonattainment new source review (NNSR) and contingency measures. EPA 
proposes to conclude that Kentucky has appropriately demonstrated that 
the nonattainment plan provisions provide for attainment of the 2010 1-
hour primary SO2 NAAQS in the Jefferson County nonattainment 
area by the applicable attainment date and that the nonattainment plan 
meets the other applicable requirements under CAA.

DATES: Comments must be received on or before December 10, 2018.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2017-0625 at http://www.regulations.gov. Follow the online 
instructions for submitting comments. Once submitted, comments cannot 
be edited or removed from Regulations.gov. EPA may publish any comment 
received to its public docket. Do not submit electronically any 
information you consider to be Confidential Business Information (CBI) 
or other information whose disclosure is restricted by statute. 
Multimedia submissions (audio, video, etc.) must be accompanied by a 
written comment. The written comment is considered the official comment 
and should include discussion of all points you wish to make. EPA will 
generally not consider comments or comment contents located outside of 
the primary submission (i.e. on the web, cloud, or other file sharing 
system). For additional submission methods, the full EPA public comment 
policy, information about CBI or multimedia submissions, and general 
guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

FOR FURTHER INFORMATION CONTACT: Richard Wong, Air Regulatory 
Management Section, Air Planning and Implementation Branch, Air, 
Pesticides and Toxics Management Division, U.S. Environmental 
Protection Agency, Region 4, 61 Forsyth Street SW, Atlanta, Georgia 
30303-8960. Mr. Wong can be reached via telephone at (404) 562-8726 or 
via electronic mail at [email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Requirement for Kentucky to Submit an SO2 Attainment 
Plan for the Jefferson County Area
II. Requirements for SO2 Attainment Plans
III. Attainment Demonstration and Longer Term Averaging
IV. Review of Attainment Plan Requirements
    A. Emission Inventory
    B. Attainment Modeling Demonstration
    1. Model Selection
    2. Meteorological Data
    3. Emissions Data
    4. Emission Limits
    i. Enforceability
    ii. Longer Term Average Limits
    5. Background Concentration
    6. Summary of Modeling Results
    C. RACM/RACT
    D. New Source Review (NSR)
    E. Reasonable Further Progress (RFP)

[[Page 56003]]

    F. Contingency Measures
V. Incorporation by Reference
VI. EPA's Proposed Action
VII. Statutory and Executive Orders

I. Requirements for Kentucky to Submit an SO2 Plan for the Jefferson 
County Area.

    On June 22, 2010 (75 FR 35520), EPA promulgated a new 1-hour 
primary SO2 NAAQS of 75 parts per billion (ppb), which is 
met at an ambient air quality monitoring site when the 3-year average 
of the annual 99th percentile of daily maximum 1-hour average 
concentrations does not exceed 75 ppb, as determined in accordance with 
Appendix T of 40 CFR part 50. See 40 CFR 50.17(a)-(b). On August 5, 
2013 (78 FR 47191), EPA designated a first set of 29 areas of the 
country as nonattainment for the 2010 SO2 NAAQS. See 40 CFR 
part 81, subpart C. These designations included the Jefferson County 
nonattainment area, which encompasses the primary SO2 
emitting source Mill Creek and the nearby Watson Lane SO2 
monitor (Air Quality Site (AQS) ID: 21-11-0051). These area 
designations were effective October 4, 2013. Section 191 of the CAA 
directs states to submit SIPs for areas designated as nonattainment for 
the SO2 NAAQS to EPA within 18 months of the effective date 
of the designation, i.e., by no later than April 4, 2015, in this case. 
Under CAA section 192(a), these SIPs are required to demonstrate that 
their respective areas will attain the NAAQS as expeditiously as 
practicable, but no later than 5 years from the effective date of 
designation, which is October 4, 2018.
    For the Jefferson County nonattainment area (and many other areas), 
EPA published a notice on March 18, 2016 (81 FR 14736), that Kentucky 
(and other pertinent states) had failed to submit the required 
SO2 nonattainment plan by the submittal deadline. This 
finding initiated a deadline under CAA section 179(a) for the potential 
imposition of NSR offset and highway funding sanctions. However, 
pursuant to Kentucky's submittal of June 23, 2017,\1\ and EPA's 
subsequent letter dated October 10, 2017, to Kentucky finding the 
submittal to be complete and noting the termination of these sanctions 
deadlines, these sanctions under section 179(a) were not and will not 
be imposed as a result of Kentucky having missed the April 4, 2015, 
submittal deadline. Under CAA section 110(c), EPA's March 18, 2016, 
finding also triggered a requirement that EPA promulgate a federal 
implementation plan (FIP) within two years of the finding unless, by 
that time (a) the state has made the necessary complete submittal and 
(b) EPA has approved the submittal as meeting applicable requirements. 
EPA's FIP duty will be terminated if EPA issues a final approval of 
Kentucky's SIP revision.
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    \1\ EPA received Kentucky's submittal on July 6, 2017.
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II. Requirements for SO2 Nonattainment Area Plans

    Nonattainment areas must provide SIPs meeting the applicable 
requirements of the CAA, and specifically CAA sections 110(a), 172, 191 
and 192 for the SO2 NAAQS. EPA's regulations governing 
nonattainment SIPs are set forth at 40 CFR part 51, with specific 
procedural requirements and control strategy requirements residing at 
subparts F and G, respectively. Soon after Congress enacted the 1990 
Amendments to the CAA, EPA issued general guidance on SIPs, in a 
document entitled the ``General Preamble for the Implementation of 
Title I of the Clean Air Act Amendments of 1990,'' published at 57 FR 
13498 (April 16, 1992) (General Preamble). Among other things, the 
General Preamble addressed SO2 SIPs and fundamental 
principles for SIP control strategies. Id., at 13545-49, 13567-68. On 
April 23, 2014, EPA issued guidance for meeting the statutory 
requirements in SO2 SIPs under the 2010 primary NAAQS, in a 
document entitled, ``Guidance for 1-Hour SO2 Nonattainment 
Area SIP Submissions,'' available at https://www.epa.gov/sites/production/files/2016-06/documents/20140423guidance_nonattainment_sip.pdf (hereafter referred to as 
SO2 nonattainment guidance). In this guidance, EPA described 
the statutory requirements for SO2 SIPs for nonattainment 
areas, which include: An accurate emissions inventory of current 
emissions for all sources of SO2 within the nonattainment 
area; an attainment demonstration; demonstration of RFP; implementation 
of RACM (including RACT); NNSR; enforceable emissions limitations and 
control measures; and adequate contingency measures for the affected 
area.
    For EPA to fully approve a SIP as meeting the requirements of CAA 
sections 110, 172 and 191-192, and EPA's regulations at 40 CFR part 51, 
the SIP for the affected area needs to demonstrate to EPA's 
satisfaction that each of the aforementioned requirements have been 
met. Under CAA sections 110(l) and 193, EPA may not approve a SIP that 
would interfere with any applicable requirement concerning NAAQS 
attainment and RFP, or any other applicable requirement, and no 
requirement in effect (or required to be adopted by an order, 
settlement, agreement, or plan in effect before November 15, 1990) in 
any area which is a nonattainment area for any air pollutant, may be 
modified in any manner unless it insures equivalent or greater emission 
reductions of such air pollutant. EPA is proposing to approve 
Kentucky's June 23, 2017, SO2 attainment SIP for the 
Jefferson County nonattainment area because EPA has preliminarily 
determined that the plan satisfies the aforementioned CAA and 
regulatory requirements for nonattainment areas. Furthermore, EPA notes 
that current 2015-2017 quality-assured and certified data for the 
Watson Lane monitor (AQS ID: AQS ID: 21-11-0051) in the nonattainment 
area indicates a design value below the 1-hour SO2 standard.

III. Attainment Demonstration and Longer Term Averaging

    CAA sections 172(c)(1) and (6) direct states with areas designated 
as nonattainment to demonstrate that the submitted plan provides for 
attainment of the NAAQS. 40 CFR part 51, subpart G further delineates 
the control strategy requirements that SIPs must meet, and EPA has long 
required that all SIPs and control strategies reflect four fundamental 
principles of quantification, enforceability, replicability, and 
accountability. General Preamble, at 13567-68. SO2 
attainment plans must consist of two components: (1) Emission limits 
and other control measures that assure implementation of permanent, 
enforceable and necessary emission controls, and (2) a modeling 
analysis which meets the requirements of 40 CFR part 51, Appendix W 
which demonstrates that these emission limits and control measures 
provide for timely attainment of the primary SO2 NAAQS as 
expeditiously as practicable, but by no later than the CAA maximum 
attainment date for the affected area. In all cases, the emission 
limits and control measures must be accompanied by appropriate methods 
and conditions to determine compliance with the respective emission 
limits and control measures and must be quantifiable (i.e., a specific 
amount of emission reduction can be ascribed to the measures), fully-
enforceable (specifying clear, unambiguous and measurable requirements 
for which compliance can be practicably determined), replicable (the 
procedures for determining compliance are sufficiently specific and 
non-subjective so that two independent entities applying the procedures 
would obtain the same result), and accountable

[[Page 56004]]

(source specific limits must be permanent and must reflect the 
assumptions used in the SIP demonstrations).
    EPA's April 2014 SO2 nonattainment guidance recommends 
that the emission limits be expressed as short-term average limits 
(e.g., addressing emissions averaged over one or three hours), but also 
describes the option to establish emission limits with longer averaging 
times of up to 30 days so long as the limits meet certain recommended 
criteria. See SO2 nonattainment guidance, pp. 22 to 39. The 
guidance recommends that--should states and sources utilize longer 
averaging times--the longer term average limit should be a lower-
adjusted level that reflects a stringency comparable to the 1-hour 
average limit at the critical emission value (CEV) shown by modeling to 
provide for attainment that the plan otherwise would have set.
    EPA's SO2 nonattainment guidance provides an extensive 
discussion of EPA's rationale for concluding that appropriately set 
comparably stringent limitations based on averaging times as long as 30 
days can be found to provide for attainment of the 2010 SO2 
NAAQS. In evaluating this option, EPA considered the nature of the 
standard, conducted detailed analyses of the impact concerning the use 
of 30-day average limits on the prospects for attaining the standard, 
and carefully reviewed how best to achieve an appropriate balance among 
the various factors that warrant consideration in judging whether a 
state's plan provides for attainment. Id. at pp. 22 to 39. See also id. 
at Appendices B, C, and D.
    As specified in 40 CFR 50.17(b), the 1-hour primary SO2 
NAAQS is met at an ambient air quality monitoring site when the 3-year 
average of the annual 99th percentile of daily maximum 1-hour average 
concentrations is less than or equal to 75 ppb. In a year with 365 days 
of valid monitoring data, the 99th percentile would be the fourth 
highest daily maximum 1-hour value. The 2010 SO2 NAAQS, 
including this form of determining compliance with the standard, was 
upheld by the U.S. Court of Appeals for the District of Columbia 
Circuit in Nat'l Envt'l Dev. Ass'n's Clean Air Project v. EPA, 686 F.3d 
803 (D.C. Cir. 2012). Because the standard has this form, a single 
hourly exceedance of the 75-ppb level does not create a violation of 
the standard. Instead, at issue is whether a source operating in 
compliance with a properly set longer term average could cause 
exceedances, and if so the resulting frequency and magnitude of such 
exceedances, and in particular, whether EPA can have reasonable 
confidence that a properly set longer term average limit will provide 
that the 3-year average of the annual fourth highest daily maximum 1-
hour value will be at or below 75 ppb. A synopsis of how EPA judges 
whether such plans ``provide for attainment,'' based on modeling of 
projected allowable emissions and in light of the SO2 NAAQS 
form for determining attainment at monitoring sites, follows.
    For SO2 plans that are based on 1-hour emission limits, 
the standard approach is to conduct modeling using fixed emission 
rates. The maximum emission rate that would be modeled to result in 
attainment (i.e., in an ``average year'' \2\ shows three, not four days 
with maximum hourly levels exceeding 75 ppb) is labeled the ``critical 
emission value.'' The modeling process for identifying this critical 
emissions value inherently considers the numerous variables that affect 
ambient concentrations of SO2, such as meteorological data, 
background concentrations, and topography. In the standard approach, 
the state would then provide for attainment by setting a continuously 
applicable 1-hour emission limit at this critical emission value.
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    \2\ An ``average year'' is used to mean a year with average air 
quality. While 40 CFR 50 Appendix T provides for averaging three 
years of 99th percentile daily maximum hourly values (e.g., the 
fourth highest maximum daily hourly concentration in a year with 365 
days with valid data), this discussion and an example below uses a 
single ``average year'' to simplify the illustration of relevant 
principles.
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    EPA recognizes that some sources have highly variable emissions, 
for example due to variations in fuel sulfur content and operating 
rate, that can make it extremely difficult, even with a well-designed 
control strategy, to ensure in practice that emissions for any given 
hour do not exceed the critical emission value. EPA also acknowledges 
the concern that longer term emission limits can allow short periods 
with emissions above the ``critical emission value,'' which, if 
coincident with meteorological conditions conducive to high 
SO2 concentrations, could in turn create the possibility of 
a NAAQS exceedance occurring on a day when an exceedance would not have 
occurred if emissions were continuously controlled at the level 
corresponding to the critical emission value. However, for several 
reasons, EPA believes that the approach recommended in its guidance 
document suitably addresses this concern. First, from a practical 
perspective, EPA expects the actual emission profile of a source 
subject to an appropriately set longer term average limit to be similar 
to the emission profile of a source subject to an analogous 1-hour 
average limit. EPA expects this similarity because it has recommended 
that the longer term average limit be set at a level that is comparably 
stringent to the otherwise applicable 1-hour limit (reflecting a 
downward adjustment from the critical emissions value) and that takes 
the source's emissions profile into account. As a result, EPA expects 
either form of emission limit to yield comparable air quality.
    Second, from a more theoretical perspective, EPA has compared the 
likely air quality with a source having maximum allowable emissions 
under an appropriately set longer term limit, to the likely air quality 
with the source having maximum allowable emissions under the comparable 
1-hour limit. In this comparison, in the 1-hour average limit scenario, 
the source is presumed at all times to emit at the critical emission 
level, and in the longer term average limit scenario the source is 
presumed to occasionally emit more than the critical emission value but 
on average, and presumably at most times, to emit well below the 
critical emission value. In an ``average year,'' compliance with the 1-
hour limit is expected to result in three exceedance days (i.e., three 
days with hourly values above 75 ppb) and a fourth day with a maximum 
hourly value at 75 ppb. By comparison, with the source complying with a 
longer term limit, it is possible that additional exceedances would 
occur that would not occur in the 1-hour limit scenario (if emissions 
exceed the critical emission value at times when meteorology is 
conducive to poor air quality). However, this comparison must also 
factor in the likelihood that exceedances that would be expected in the 
1-hour limit scenario would not occur in the longer term limit 
scenario. This result arises because the longer term limit requires 
lower emissions most of the time (because the limit is set well below 
the critical emission value), so a source complying with an 
appropriately set longer term limit is likely to have lower emissions 
at critical times than would be the case if the source were emitting as 
allowed with a 1-hour limit.
    As a hypothetical example to illustrate these points, suppose a 
source that always emits 1000 pounds of SO2 per hour, which 
results in air quality at the level of the NAAQS (i.e., results in a 
design value of 75 ppb). Suppose further that in an ``average year,'' 
these emissions cause the 5-highest maximum daily average 1-hour 
concentrations to be 100 ppb, 90 ppb, 80 ppb, 75 ppb, and 70 ppb. Then 
suppose that the source becomes subject to a 30-day average emission 
limit of 700 pounds per hour

[[Page 56005]]

(lb/hr). It is theoretically possible for a source meeting this limit 
to have emissions that occasionally exceed 1000 lb/hr, but with a 
typical emissions profile, emissions would much more commonly be 
between 600 and 800 lb/hr. In this simplified example, assume a zero-
background concentration, which allows one to assume a linear 
relationship between emissions and air quality. (A nonzero background 
concentration would make the mathematics more difficult but would give 
similar results.) Air quality will depend on what emissions happen on 
what critical hours, but suppose that emissions at the relevant times 
on these 5 days are 800 lb/hr, 1100 lb/hr, 500 lb/hr, 900 lb/hr, and 
1200 lb/hr, respectively. (This is a conservative example because the 
average of these emissions, 900 lb/hr, is well over the 30-day average 
emission limit.) These emissions would result in daily maximum 1-hour 
concentrations of 80 ppb, 99 ppb, 40 ppb, 67.5 ppb, and 84 ppb. In this 
example, the fifth day would have an exceedance that would not 
otherwise have occurred, but the third day would not have an exceedance 
that otherwise would have occurred, and the fourth day would have a 
concentration below, rather than at, 75 ppb. In this example, the 
fourth highest maximum daily concentration under the 30-day average 
would be 67.5 ppb.
    This simplified example illustrates the findings of a more 
complicated statistical analysis that EPA conducted using a range of 
scenarios using actual plant data. As described in Appendix B of EPA's 
SO2 nonattainment guidance, EPA found that the requirement 
for lower average emissions is highly likely to yield better air 
quality than is required with a comparably stringent 1-hour limit. 
Based on analyses described in Appendix B of its nonattainment 
guidance, EPA expects that an emission profile with maximum allowable 
emissions under an appropriately set comparably stringent 30-day 
average limit is likely to have the net effect of having a lower number 
of exceedances and better air quality than an emission profile with 
maximum allowable emissions under a 1-hour emission limit at the 
critical emission value. This result provides a compelling policy 
rationale for allowing the use of a longer averaging period, in 
appropriate circumstances where the facts indicate this result can be 
expected to occur.
    The question then becomes whether this approach--which is likely to 
produce a lower number of overall exceedances even though it may 
produce some unexpected exceedances above the critical emission value--
meets the requirements in sections 110(a)(1) and 172(c)(1) and (6) for 
SIPs to contain enforceable emissions limitations and other control 
measures to ``provide for attainment'' of the NAAQS. For 
SO2, as for other pollutants, it is generally impossible to 
design a nonattainment plan in the present that will guarantee that 
attainment will occur in the future. A variety of factors can cause a 
well-designed attainment plan to fail and unexpectedly not result in 
attainment, for example if meteorology occurs that is more conducive to 
poor air quality than was anticipated in the plan. Therefore, in 
determining whether a plan meets the requirement to provide for 
attainment, EPA's task is commonly to judge not whether the plan 
provides absolute certainty that attainment will in fact occur, but 
rather whether the plan provides an adequate level of confidence of 
prospective NAAQS attainment. From this perspective, in evaluating use 
of a 30-day average limit, EPA must weigh the likely net effect on air 
quality. Such an evaluation must consider the risk that occasions with 
meteorology conducive to high concentrations will have elevated 
emissions leading to exceedances that would not otherwise have 
occurred, and must also weigh the likelihood that the requirement for 
lower emissions on average will result in days not having exceedances 
that would have been expected with emissions at the critical emissions 
value. Additional policy considerations, such as in this case the 
desirability of accommodating real world emissions variability without 
significant risk of violations, are also appropriate factors for EPA to 
weigh in judging whether a plan provides a reasonable degree of 
confidence that the plan will lead to attainment. Based on these 
considerations, especially given the high likelihood that a 
continuously enforceable limit averaged over as long as 30 days, 
determined in accordance with EPA's nonattainment guidance, will result 
in attainment, EPA believes as a general matter that such limits, if 
appropriately determined, can reasonably be considered to provide for 
attainment of the 2010 SO2 NAAQS.
    The SO2 nonattainment guidance offers specific 
recommendations for determining an appropriate longer term average 
limit. The recommended method starts with determination of the 1-hour 
emission limit that would provide for attainment (i.e., the critical 
emission value), and applies an adjustment factor to determine the 
(lower) level of the longer term average emission limit that would be 
estimated to have a degree of stringency comparable to the otherwise 
necessary 1-hour emission limit. This method uses a database of 
continuous emission data reflecting the type of control that the source 
will be using to comply with the SIP emission limits, which (if 
compliance requires new controls) may require use of an emission 
database from another source. The recommended method involves using 
these data to compute a complete set of emission averages, computed 
according to the averaging time and averaging procedures of the 
prospective emission limitation. In this recommended method, the ratio 
of the 99th percentile among these long-term averages to the 99th 
percentile of the 1-hour values represents an adjustment factor that 
may be multiplied by the candidate 1-hour emission limit to determine a 
longer term average emission limit that may be considered comparably 
stringent.\3\ The guidance also addresses a variety of related topics, 
such as the potential utility of setting supplemental emission limits, 
such as mass-based limits, to reduce the likelihood and/or magnitude of 
elevated emission levels that might occur under the longer term 
emission rate limit.
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    \3\ For example, if the critical emission value is 1000 pounds 
of SO2 per hour, and a suitable adjustment factor is 
determined to be 70 percent, the recommended longer term average 
limit would be 700 lb/hr.
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    Preferred air quality models for use in regulatory applications are 
described in Appendix A of EPA's Guideline on Air Quality Models (40 
CFR part 51, Appendix W), also referred to as Guideline. In 2005, EPA 
promulgated AERMOD as the Agency's preferred near-field dispersion 
modeling for a wide range of regulatory applications addressing 
stationary sources (for example in estimating SO2 
concentrations) in all types of terrain based on extensive 
developmental and performance evaluation. Supplemental guidance on 
modeling for purposes of demonstrating attainment of the SO2 
NAAQS is provided in Appendix A to the SO2 nonattainment 
guidance document referenced above. Appendix A provides extensive 
guidance on the modeling domain, the source inputs, assorted types of 
meteorological data, and background concentrations. Consistency with 
the recommendations in this guidance is generally necessary for the 
attainment demonstration to offer adequately reliable assurance that 
the plan provides for attainment.
    As stated previously, attainment demonstrations for the 2010 1-hour 
primary SO2 NAAQS must demonstrate future attainment and 
maintenance of

[[Page 56006]]

the NAAQS in the entire area designated as nonattainment (i.e., not 
just at the violating monitor) by using air quality dispersion modeling 
(see Appendix W to 40 CFR part 51) to show that the mix of sources and 
enforceable control measures and emission rates in an identified area 
will not lead to a violation of the SO2 NAAQS. For a short-
term (i.e., 1-hour) standard, EPA believes that dispersion modeling of 
stationary sources as applied consistent with EPA's Guideline is 
technically appropriate, efficient and effective in demonstrating 
attainment in nonattainment areas because it appropriately takes into 
consideration combinations of meteorological and emission source 
operating conditions that may contribute to peak ground-level 
concentrations of SO2. The SIP modeling should follow 
requirements in the Guideline for conducting a cumulative impact 
assessment and, thus, should use EPA's preferred dispersion model, the 
AERMOD modeling system (or approved alternative model) and follow 
Section 8 of the Guideline in terms of characterizing contributions to 
total concentrations.

IV. Review of Attainment Plan Requirements

A. Emissions Inventory

    The emissions inventory and source emission rate data for an area 
serve as the foundation for air quality modeling and other analyses 
that enable states to: (1) Estimate the degree to which different 
sources within a nonattainment area contribute to violations within the 
affected area; and (2) Assess the expected improvement in air quality 
within the nonattainment area due to the adoption and implementation of 
control measures. As noted above, the state must develop and submit to 
EPA a comprehensive, accurate and current inventory of actual emissions 
from all sources of SO2 emissions in each nonattainment 
area, as well as any sources located outside the nonattainment area 
which may affect attainment in the area. See CAA section 172(c)(3) and 
(4) and EPA's SO2 nonattainment guidance.
    The base year inventory establishes a baseline that is used to 
evaluate emission reductions achieved by the control strategy and to 
assess reasonable further progress requirements. Kentucky used 2011 as 
the base year for emission inventory preparation. At the time of 
preparation of the attainment SIP, 2011 reflected the most recent 
triennial National Emission Inventory (NEI v2),\4\ Version 2 supported 
the requirement for timeliness of data, and was also representative of 
a year with violations of the primary SO2 NAAQS (i.e., one 
of the 3-years for which EPA designated the area nonattainment).
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    \4\ 2011 NEI Data--https://www.epa.gov/air-emissions-inventories/2011-national-emissions-inventory-nei-data (accessed 
January 31, 2017).
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    For the base-year inventory, Kentucky reviewed and compiled county-
level actual SO2 emissions for all source categories (i.e., 
point, mobile (on-road and non-road), area (non-point) and event 
(wildfires and prescribed burns)) in Jefferson County and then utilized 
county and partial county (the portion in the nonattainment area) 
population and land use data to determine estimated SO2 
emission inventories for sources of SO2 in the partial 
county nonattainment area. The emissions inventory provided in the June 
23, 2017, submission reflects the most current emissions profile for 
all source categories. Additionally, EPA has provided supplemental 
emissions information to accurately account for point source emissions 
for the County. In Jefferson County, point sources account for 
approximately 99 percent of the total county-level SO2 
emissions. Kentucky provided an SO2 emission inventory for 
those point sources in the County that emitted over 10 tons per year 
(tpy) based on the 2011 NEI. Table 1 below shows county-level 
SO2 emissions that emitted greater than 10 tpy in 2011.

   Table 1--Jefferson County 2011 Base Year Point Source SO2 Emission
                                Inventory
                                  (tpy)
------------------------------------------------------------------------
                                                           SO2 Emissions
                Plant/facility site name                       (tpy)
 
------------------------------------------------------------------------
Louisville Gas & Electric--Mill Creek...................       29,944.72
Louisville Gas & Electric--Cane Run.....................        7,823.72
Louisville Medical Center Steam Plant...................          475.90
Brown-Forman/Early Times................................          257.81
Cemex (Kosmos) Cement Company Inc.......................          187.47
American Synthetic Rubber Company.......................          136.87
Louisville International Airport........................          136.19
Rohm and Haas Company...................................           28.44
                                                         ---------------
    Total emissions for sources greater than 10 tpy.....   \5\ 38,991.12
Other SO2 sources.......................................           19.24
                                                         ---------------
        Total...........................................       39,010.37
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    The primary SO2-emitting point source located within the 
partial county nonattainment area is LG&E's Mill Creek Generating 
Station (Mill Creek). Mill Creek consists of four coal-fired boilers 
(U1-U4). A breakdown of the actual 2011 emissions by unit in tpy are as 
follows: Unit 1--5,211 tpy; Unit 2--6,802 tpy; Unit 3--7,175 tpy and 
Unit 4--10,756 tpy. LG&E replaced the existing wet Flue Gas 
Desulfurization (FGD) control equipment with more efficient FGD 
controls, to comply with the mercury air toxics standard (MATS). These 
replacements have been operational for all four units as of June 8, 
2016. Mill Creek is the only SO2 point source located in the 
partial nonattainment area that is listed in Table 1. Refer to sections 
IV.B.4 and IV.C for more information on Mill Creek and the 1-hour 
SO2 control strategy.
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    \5\ The 39,010.37 total SO2 point source emissions in 
Table 1 above is the supplemented comprehensive county-level base 
year SO2 point source emission inventory. EPA notes that 
the Table 1 total county-level 2011 SO2 point source 
emissions of 39,010.37 tons differs from the 38,854.87 tons sum of 
point source SO2 emissions listed in Table 3 of 
Kentucky's 2017 attainment SIP. Table 1 above accounts for EPA's 
review of the 2011 NEI v2 for all SO2 point sources in 
Jefferson County. The Commonwealth's Table 3 lists all point sources 
in the county that emitted over 10 tpy of SO2 which the 
Commonwealth acquired from EPA's 2011 NEI v2 on January 31, 2017. 
However, the Commonwealth's Table 3 inadvertently omits the 
Louisville International Airport point source listed in Table 1 
above. Additionally, EPA notes Table 1 above compiles all county-
level SO2 emissions from point sources according to the 
2011 NEI v2 including those point sources that emitted less than 10 
tpy while Kentucky's Table 3 accounts for those point sources that 
emitted greater than 10 tpy as indicated in the 2011 NEI v2. Lastly, 
EPA also notes the point source emissions entry in Kentucky's 
attainment SIP Table 2 is different from the sum of point source 
emissions in Kentucky's Table 3 and EPA's Table 1 total above. 
Therefore, the 39,010.37 tons of SO2 for point sources 
total in Table 1 above accounts for the comprehensive compilation of 
county-level point sources as indicated in the 2011 NEI v2.
---------------------------------------------------------------------------

    Prior to 2016, LG&E Cane Run Generating Station (Cane Run) was the 
next largest SO2 source located in the northern portion of 
the County and outside the nonattainment area. The facility had three 
boilers and reported SO2 emissions of 7,823 tons in 2011. In 
2015, LG&E constructed a new natural gas combined cycle turbine (U15) 
at the

[[Page 56007]]

Cane Run facility and shut-down coal-fired units U4 thru U8 and U10.\6\
---------------------------------------------------------------------------

    \6\ KDAQ submitted information regarding the shut-down of the 
coal-fired units U4 thru U8 and U10 and the new natural gas combined 
cycle (U15) and auxiliary unit (U16) to EPA on June 20, 2016, to 
satisfy part of its obligations under the SO2 Data 
Requirements Rule at 40 CFR 51.1203(b). The Title V operating permit 
175-00-TV(R2) established a natural gas fuel restriction for EGUs 
U15 and U16 is included in the docket for this proposal (ID: EPA-
R04-OAR-2017-0625).
---------------------------------------------------------------------------

    The CEMEX Kosmos Louisville Cement Plant (Kosmos) is outside the 
boundary of, but adjacent to, the Jefferson County nonattainment area. 
The facility produces Portland and masonry cement and has a production 
design capacity of 1.6 million short tons of cement per year. The 
primary source of the SO2 emissions are from kiln 
operations, which emitted 187 tons in 2011.
    Mill Creek is the only point source in the nonattainment area and 
the primary source of the violation at the Watson Lane monitor at the 
time of designations for the nonattainment area listed in Table 1. 
Therefore, Mill Creek was the only SO2 source the 
Commonwealth and the District considered for further evaluation 
determined to impact the nonattainment area. Cane Run, Kosmos and the 
remaining county-level point sources in Table 1 are all located outside 
of the nonattainment area and were accounted for in the attainment 
modeling through the background monitor (see section IV.B.4 below).
    KDAQ used the 2011 NEIv2 to obtain estimates of the area and 
nonroad sources. For on-road mobile source emissions, KDAQ utilized 
EPA's Motor Vehicle Emissions Simulator (MOVES2014) and NONROAD. A more 
detailed discussion of the emissions inventory development for the 
Jefferson County Area can be found in the June 23, 2017, submittal. 
Table 2 below provides Kentucky's 2011 base year county-level 
SO2 emission inventory for Jefferson County.

                                            Table 2--2011 Base Year Emissions Inventory for Jefferson County
                                                                          (tpy)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                       Year                              Point           On-road          Nonroad            Area            Event            Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
2011..............................................   \7\ 39,010.37            64.20           158.75            38.28             2.61        39,274.21
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Based on an evaluation of county and partial county (nonattainment 
area) census and land use data, Kentucky determined that the 
nonattainment area accounted for 0.42 percent of the total county land 
use \8\ or a total of 1.1 tpy when applied to the county-level source 
categories in Table 2, excluding the point source category (see Table 1 
above). As noted above, Mill Creek is the only point source in the 
nonattainment area. Table 3 below shows the level of SO2 
emissions, expressed in tpy, in the partial Jefferson County 
nonattainment area for the 2011 base year by emissions source category.
---------------------------------------------------------------------------

    \7\ EPA notes that the total county-level 2011 SO2 
point source emissions of 39,010.37 tons differ from the 38,966.95 
tons sum of point source SO2 emissions listed in Table 2 
of Kentucky's 2017 attainment SIP. Table 2 above accounts for EPA's 
review of the 2011 NEI v2 for all SO2 point sources in 
Jefferson County.
    \8\ Based on the 2010 census data, the population in Jefferson 
County was 741,096 in a land area of approximately 380.42 square 
miles. At the census tract level for the county including the 
nonattainment area, roughly 8.25 square miles, the population was 
estimated to 7,170 or approximately 1 percent of the total county 
population. The nonattainment area occupies only 1.61 square miles 
of the census tracts or approximately 0.42 percent of the total land 
area.

                        Table 3--2011 Base Year Emission Inventory for the Jefferson County Partial Nonattainment Area emissions
                                                                        (tpy) \9\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                     Base year                           Point           On-road          Nonroad            Area            Event            Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
2011..............................................  \10\ 29,944.72             0.27             0.67             0.16             0.01        29,945.83
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The attainment demonstration also provides for a projected 2018 
attainment year inventory that includes estimated emissions for all 
emission sources of SO2 which are determined to impact the 
nonattainment area for the year in which the Area is expected to attain 
the standard. This inventory should also address any future growth in 
the Area or any potential increases in emissions of the pollutant for 
which the Jefferson County Area is nonattainment due to the 
construction and operation of new major sources, major modifications to 
existing sources, or increased minor source activity. KDAQ stated in 
its June 23, 2017, submittal that because the Area is rural and 
relatively small, it is unlikely that there will be any significant 
growth in the nonattainment area. However, the Commonwealth cites to 
the District's Regulation 2.04, Construction or Modification of Major 
Sources in or Impacting Upon Non-Attainment Areas, which requires NNSR, 
approved into the SIP and last updated on October 23, 2001 (see 66 FR 
53660). The District's SIP-approved NNSR program requires lowest 
achievable emissions rate, offsets, and public participation 
requirements for major stationary sources and major modification and 
therefore, would account for potential growth in the nonattainment 
area. Kentucky reviewed and compiled county-level actual SO2 
emissions for all source categories (i.e., point, mobile (on-road and 
non-road), area (non-point) and event) in Jefferson County and then 
utilized county and partial county nonattainment area population and 
land use data to determine estimated SO2 emission 
inventories for sources of SO2 in the nonattainment area. 
The Commonwealth developed a projected emissions inventory for county-
level SO2 emissions source categories based on the 2011 NEI 
as well as the 2008 NEI inventory to extrapolate emissions to 2018. The 
point source emissions were estimated by taking credit at Mill Creek 
for the new wet FGD controls and title V operating permit limits of 
0.20 lb/

[[Page 56008]]

MMBtu per unit based on a rolling 30-day average.\11\ Point sources in 
the County are still expected to account for approximately 99 percent 
of the total county-level SO2 emissions.\12\ Emission 
estimates for on-road sources were re-estimated with MOVES2014; nonroad 
emissions were projected using national growth factors, and area source 
emissions were scaled based on emission factors developed using the 
Annual Energy Outlook 2014 for consumption and production forecasts. 
Table 4 below provides Kentucky's 2018 projected county-level 
SO2 emission inventory for Jefferson County.
---------------------------------------------------------------------------

    \9\ Table 2 of Kentucky's 2017 attainment SIP lists the county-
level emissions. EPA applied the 0.42 percent to the county-level 
on-road, nonroad and area source categories in Table 2 to derive the 
emissions for the nonattainment area.
    \10\ Mill Creek.
    \11\ Title V operating permit 145-97-TV(R3) issued by Jefferson 
County is in the Docket (ID: EPA-R04-OAR-2017-0625) for this 
proposal action.
    \12\ Kentucky developed an adjusted 2018 projected attainment 
year inventory to account for SO2 emission reductions 
from additional point sources in the County including LG&E Mill 
Creek and Cane Run. The attainment SIP submission indicates the 
SO2 emissions reductions from sources outside of the 
nonattainment area are not required to demonstrate attainment but 
acknowledges decreases in other source SO2 point source 
emissions with the replacement from coal-fired units to other fuel 
at LG&E Cane Run, University of Louisville (99 percent decrease), 
and Duke Energy's Gallagher Electric Generating Station (92 percent 
decrease) in Floyd County, Indiana.

                                  Table 4--2018 Projected Attainment Year SO2 Emissions Inventory for Jefferson County
--------------------------------------------------------------------------------------------------------------------------------------------------------
                       Year                              Point           On-road          Nonroad            Area            Event            Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018..............................................       18,391.77            38.04           158.75            55.62             5.99        18,650.17
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Based on county and partial county nonattainment area census and 
land use data, similar to the base-year nonattainment area inventory, 
Kentucky applied the 0.42 percent nonattainment area land use ratio to 
the 2018 county-level projected emissions inventory in Table 4 
resulting in total of 1.06 tpy for on-road, non-road and area sources, 
excluding point source category.\13\ Table 5 below shows the level of 
emissions, expressed in tpy, in the Jefferson County nonattainment area 
for the 2018 projected attainment year inventory.
---------------------------------------------------------------------------

    \13\ Mill Creek is the only point source in the nonattainment 
Area.
---------------------------------------------------------------------------

    KDAQ provided a future year projected emissions inventory for all 
known sources included in the 2011 base year inventory, discussed 
above. The projected emissions are consistent with expected levels 
beyond October 4, 2018, when the control strategy for the attainment 
demonstration will be fully implemented. Therefore, as an annual future 
year inventory, the point source portion is reasonably estimated beyond 
October 4, 2018, and would represent an annual inventory for 2019 or 
beyond. The projected emissions in Table 2 are estimated actual 
emissions, representing a 55 percent reduction from the base year 
SO2 emissions.

                       Table 5--2018 Projected Attainment Year Emissions Inventory for Jefferson County Partial Nonattainment Area
                                                                       (tpy) \14\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                       Year                              Point           On-road          Nonroad            Area            Event            Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
2018..............................................          13,490             0.16             0.67             0.23             0.03        13,491.09
--------------------------------------------------------------------------------------------------------------------------------------------------------

    EPA has evaluated Kentucky's 2011 base year and projected emissions 
inventory for the Jefferson County nonattainment area and has made the 
preliminary determination that these inventories were developed 
consistent with EPA's April 2014 SO2 nonattainment guidance. 
Although EPA has noted minor discrepancies between Kentucky's inventory 
provided in the nonattainment SIP and the 2011 NEI, EPA is proposing to 
find that Kentucky's inventory is sufficiently comprehensive and 
accurate to serve the planning purposes for which the inventory is 
required. Therefore, EPA is proposing to determine the Jefferson County 
SO2 attainment SIP meets the requirements of CAA section 
172(c)(3) and (4) for the Jefferson County nonattainment area.
---------------------------------------------------------------------------

    \14\ Table 5 of Kentucky's 2017 attainment SIP lists the county-
level projected emissions. EPA applied the 0.42 percent to the 
county-level on-road, nonroad and area source categories in Table 5 
to derive the emissions for the partial county nonattainment area.
---------------------------------------------------------------------------

B. Attainment Modeling Demonstration

    The following discussion is an evaluation of various features of 
the modeling that Kentucky used in its attainment demonstration.
1. Model Selection
    Kentucky's attainment demonstration used AERMOD, the EPA's 
preferred model for this application. The Commonwealth used AERMOD 
version 15181 with regulatory default options and a rural land use 
designation. Version 15181 of the AERMOD modeling system was the 
current regulatory version at the time Kentucky was preparing the 
attainment demonstration. Appendix 3 in Kentucky's June 23, 2017, 
submittal, provides a summary of the modeling procedures and options, 
including details explaining how they applied the Auer technique to 
determine that the rural dispersion coefficients were appropriate for 
the modeling. Model receptors were located throughout the nonattainment 
area using a grid with 100 meters spacing between receptors. Receptor 
elevations and hill heights required by AERMOD were determined using 
the AERMAP terrain preprocessor version 11103. The meteorological data 
was processed using AERMET version 15181 and AERMINUTE version 15272. 
The surface characteristics around the meteorological surface station 
were determined using AERSURFACE version 13016. An analysis of Good 
Engineering Practice (GEP) stack heights and building downwash was 
performed using BPIPPRIME version 04274. The results of the downwash 
analysis show that the actual stack heights at the Mill Creek facility 
exceed the GEP heights, so the GEP stack heights for each stack were 
used in the modeling. EPA proposes to find the model selection and 
procedures used to run the model appropriate.
2. Meteorological Data
    The Commonwealth incorporated the most recently available five 
years of

[[Page 56009]]

meteorology data from 2011-2015, as measured at a spatially 
representative National Weather Service airport site. The 1-minute 
surface-level data came from the Louisville Standiford Field station in 
Louisville, Kentucky located about 20 kilometers (km) to the northeast 
of the facility. Twice daily upper-air meteorological information came 
from the Wilmington Air Park, Wilmington, Ohio station located about 
240 km to the northeast. The surface characteristics of the 
meteorological surface station were processed using AERSURFACE version 
13016 following EPA-recommended procedures and were determined to be 
representative of the facility by the Commonwealth. EPA proposes to 
find that the meteorological data selection and processing are 
appropriate.
3. Emissions Data
    As previously stated, Mill Creek is the only SO2 
emitting major point source in the nonattainment area and the only 
emission source explicitly modeled in the attainment modeling analysis 
for the Jefferson County nonattainment area. All minor area sources and 
other major point sources (located outside the nonattainment area 
boundary) were accounted for with the background concentration 
discussed in Section IV.B.5. Mill Creek operates four coal-fired boiler 
units (U1 thru U4) that emit from three stacks. Unit 1 and Unit 2 have 
a joint stack (S33) while Unit 3 and Unit 4 have separate stacks (S4 
and S34, respectively). Mill Creek replaced its wet FGD Units on all 
stacks to improve SO2 reduction efficiencies. All FGD 
construction was completed and operational by June 8, 2016.
    The Commonwealth evaluated the emissions from Mill Creek and 
derived a set of three SO2 critical emission values (CEVs), 
one for each stack, from AERMOD modeling simulations to show compliance 
with the 2010 SO2 NAAQS. The AERMOD modeling analysis 
resulted in the following CEV's: Stack S33, which serves Units 1 and 2, 
was modeled at 225.4 grams/second (g/s) equivalent to 1,789 lb/hr; 
stack S4, which serves Unit 3, was modeled at 152.6 g/s equivalent to 
1,211 lb/hr; and stack S34, which serves Unit 4, was modeled at 183.6 
g/s equivalent to 1,457 lb/hr. In each case, the modeled emission rate 
corresponds to 0.29 pounds per million British thermal units (lb/MMBtu) 
times the maximum heat input capacity (MMBtu/hr) of the unit(s) 
associated with each stack. This form of an emission limit, in lb/
MMBtu, is a frequent form of emission limit associated with electric 
generating units. The Commonwealth determined from these AERMOD 
modeling simulations that an hourly emission limit of 0.29 lb/MMBtu 
would suffice to ensure modeled attainment of the SO2 NAAQS. 
However, the Commonwealth opted to apply a 30-day average limit, 
following EPA's SO2 nonattainment guidance for setting 
longer term average limits. The Commonwealth determined that a 30-day 
average limit of 0.20 lb/MMBtu could be considered comparably stringent 
to a 1-hour limit of 0.29 lb/MMBtu. Section IV.B.4.ii below, entitled 
``Longer Term Average Limits,'' provides more discussion on how the 
Commonwealth made this determination.
4. Emission Limits
    An important prerequisite for approval of an attainment plan is 
that the emission limits that provide for attainment be quantifiable, 
fully-enforceable, replicable, and accountable. See General Preamble at 
13567-68. Therefore, part of the review of Kentucky's attainment plan 
must address the use of these limits, both with respect to the general 
suitability of using such limits for this purpose and with respect to 
whether the limits included in the plan have been suitably demonstrated 
to provide for attainment. The first subsection that follows addresses 
the enforceability of the limits in the plan, and the second subsection 
that follows addresses the 30-day average limits.
i. Enforceability
    Section 172(c)(6) provides that emission limits and other control 
measures in the attainment SIP shall be enforceable. Kentucky's 
attainment SIP for the Jefferson County nonattainment area relies on 
control measures and enforceable emission limits for the four coal-
fired boilers at Mill Creek. These emission reduction measures were 
accounted for in the attainment modeling for Mill Creek, which 
demonstrates attainment for the 2010 SO2 NAAQS. Kentucky's 
control strategy for the Jefferson County nonattainment area consists 
of replacing FGD control equipment with more efficient FGD controls at 
Mill Creek, addressing SO2 emissions for all four units (U1, 
U2, U3 and U4): Unit 4 new FGD went into service on December 9, 2014; 
Units 1 and 2 new combined FGD went into service on May 27, 2015; and 
Unit 3 new FGD went into service on June 8, 2016.
    LG&E installed wet FGD replacements at Mill Creek to comply with 
the MATS Rule.\15\ Jefferson County issued a construction permit (No. 
34595-12-C) on June 15, 2012, to LG&E authorizing the construction for 
wet FGD control equipment replacements for the four coal-fired boilers 
at the Mill Creek facility. This construction permit also included a 
0.20 lb/MMBtu limit for SO2 as a surrogate for the 
hydrochloric acid gas requirements for MATS. This emission limit was 
incorporated into the title V permit on July 31, 2014, (145-97-TV 
(R2)). LG&E was required to comply with the MATS Rule by April 
2016.\16\ Effective June 8, 2016, the Mill Creek facility completed 
installation of improved wet FGD SO2 controls on all three 
stacks, which has reduced SO2 emissions by approximately 89 
percent since 2014 emission levels.\17\
---------------------------------------------------------------------------

    \15\ On December 16, 2011, EPA established the MATS Rule to 
reduce emissions of toxic air pollutants for coal or oil power 
plants larger than 25 megawatts. The rule establishes alternative 
numeric emission standards, including SO2 (as an 
alternate to hydrochloric acid), individual non-mercury metal air 
toxics (as an alternate to particulate matter (PM)), and total non-
mercury metal air toxics (as an alternate to PM) for certain 
subcategories of power plants. CAA section 112, MACT regulations for 
coal-and oil fired EGUs, known as the Mercury and Air Toxics 
Standards, were targeted at reducing EGU emissions of HAPs (e.g., 
mercury, hydrochloric acid (HCl), hydrogen fluoride (HF), dioxin, 
and various metals) and not explicitly targeted at reducing 
emissions of SO2. Under the MATS, EGUs meeting specific 
criteria may choose to demonstrate compliance with alternative 
SO2 emission limits in lieu of demonstrating compliance 
with HCl emission limits.
    \16\ Mill Creek was required to comply with the MATS Rule by 
April 16, 2016 (extended compliance date).
    \17\ Mill Creek annual SO2 emissions have dropped, 
from 28,149 tons in 2014 to 3,040 tons in 2017. See https://ampd.epa.gov/ampd/.
---------------------------------------------------------------------------

    As discussed further in the RACT/RACM section 1V.C below, Kentucky 
determined that the wet FGD replacements at Mill Creek provide for 
SO2 emission reductions that model attainment for the 
Jefferson County nonattainment area. With respect to the 1-hour 
SO2 standard, Kentucky established an independent emission 
limit of 0.20 lb/MMBtu, for each coal-fired unit at Mill Creek on a 30-
day average basis in accordance with EPA's SO2 nonattainment 
guidance for longer term averaging time for the purpose of 
demonstrating attainment for the 1-hour SO2 standard (see 
section IV.B.4. ii). These emission limits apply independently to each 
of the four coal-fired units (U1 thru U4), which emit SO2 
from three separate stacks (S33, S4, and S34). Unit 1 and Unit 2 share 
a common stack (S33) while Unit 3 and Unit 4 have separate stacks (S4 
and S34, respectively). These SO2 limits were established in 
a revised title V operating permit 145-97-TV(R3) for Mill Creek

[[Page 56010]]

and became effective on April 5, 2017. Mill Creek demonstrates 
compliance with the 30-day emission limits through a continuous 
emission monitoring system on each stack as well as the monitoring of 
the heat input firing rate of each emission unit. The 30-day 
SO2 emission limit was established to demonstrate modeled 
attainment of the 2010 1-hour SO2 standard for the Jefferson 
County nonattainment area and therefore is separate from the 
SO2 emission limit of the same numerical value established 
to comply with the 2012 MATS Rule (i.e., SO2 as a surrogate 
for hydrochloric acid). These two limits were independently established 
through unique methodologies and guidance to address distinct and 
separate CAA requirements for the LG&E Mill Creek facility. Kentucky 
requested that EPA incorporate into the Jefferson County portion of the 
Commonwealth's SIP the 30-day SO2 emission limits and 
operating and compliance parameters (monitoring, record keeping and 
reporting) established at Plant-wide Specific condition S1-Standards, 
S2-Monitoring and Record Keeping and S3-Reporting \18\ in title V 
permit 145-97-TV(R3).\19\ The accountability of the SO2 
emission limits is established through KDAQ's request to include the 
limits in the SIP and in the attainment modeling demonstration to 
ensure permanent and enforceable emission limitations as necessary to 
provide for attainment of the 2010 SO2 NAAQS.
---------------------------------------------------------------------------

    \18\ The plant-wide specific conditions S2-Monitoring and 
Recordkeeping and S3-Reporting reference specific compliance 
parameters for the 30-day SO2 emission limit for each 
individual EGU (U1, U2, U3 and U4). Therefore, the specific 
SO2 monitoring and recordkeeping and reporting 
requirements, for each EGU are located at the Specific Conditions 
S2-Monitoring and Recordkeeping (b) and S3-Reporting (b) for 
SO2.
    \19\ EPA notes that Kentucky originally requested that EPA 
incorporate into the Kentucky SIP the per unit SO2 
emission limits for Mill Creek along with compliance parameters that 
were established in title V permit 145-97-TV(R2). However, through a 
supplement Louisville has subsequently requested EPA incorporate 
portions of permit 145-97-TV(R3) which contains the new 0.20 lb/
mmBtu per unit emission limit based on a 30-day averaging time.
---------------------------------------------------------------------------

ii. Longer Term Average Limits
    Kentucky established an emission limit of 0.20 lb/MMBtu of 
SO2 emissions, for each individual coal-fired emission unit 
at Mill Creek, on a 30-day average basis. This emission limit applies 
individually to each of the four coal-fired units (U1 thru U4), which 
emit SO2 from three stacks. Unit 1 and Unit 2 have a joint 
stack (Stack ID S33) while Unit 3 and Unit 4 each have separate stacks 
(Stack IDs S4 and S34, respectively). As discussed above in the 
emissions data section, modeling was performed by Jefferson County and 
the Commonwealth to determine an appropriate CEV, in g/s, for each of 
the three stacks (stack S33, which serves Units 1 and 2, was modeled at 
225.4 g/s; stack S4, which serves Unit 3, was modeled at 152.6 g/s; and 
stack S34, which serves Unit 4, was modeled at 183.6 g/s). The 
corresponding candidate 1-hour emission factor limits (in lb/MMBtu) may 
be calculated by first converting these g/s CEV values to lb/hr (using 
a standard unit conversion factor of 1 g/s = 7.937 lb/hr) and then 
dividing by the maximum heat input capacity of each unit, in MMBtu/hr. 
In each case, the CEV corresponds to an emission factor of 0.29 lb/
MMBtu. Since Units 1 and 2 share a stack (S33), the relevant maximum 
heat input capacity was the combined value for both units (6,170 MMBtu/
hr total). Unit 3 has a maximum heat input capacity of 4,204 MMBtu/hr 
and vents to a single stack (S4), and Unit 4 has a maximum heat input 
capacity of 5,025 MMBtu/hr and vents to a single stack (S34).
    As discussed further below, Kentucky used the procedures in EPA's 
April 2014 SO2 nonattainment guidance to determine a 
compliance ratio (adjustment factor) of 0.69, which when multiplied by 
0.29 lbs/MMBTU yields a 30-day average limit of 0.20 lbs/MMBTU. Each of 
the four emission units were subject to this 0.20 lb/MMBtu 30-day 
average permit limit effective April 5, 2017. EPA generally defines the 
term CEV to mean the 1-hour emission rate for an individual stack that, 
in combination with the other CEVs for other relevant stacks, is shown 
through proper modeling to yield attainment. As mentioned above, 
Kentucky developed a set of CEVs (one per stack) in each case 
corresponding to an hourly limit of 0.29 lb/MMBtu and demonstrated with 
AERMOD modeling that these CEVs show modeled compliance with the NAAQS. 
Unit 1 and Unit 2 have a joint stack (S33) and a combined wet FGD 
control, while Unit 3 and Unit 4 have separate stacks (S4 and S34, 
respectively), each with individual wet FGD controls.
    EPA's SO2 nonattainment guidance recommends that any 
longer term average emission limit should be comparably stringent to 
the 1-hour limit that has been shown to provide for attainment of the 
2010 SO2 standard. The guidance recommends a procedure, 
detailed in Appendix C, for determining an adjustment factor which may 
be multiplied times the candidate 1-hour limit to derive a longer term 
limit that may be estimated to be comparably stringent to the 1-hour 
limit. Using this procedure (discussed in section II above) and using 
hourly emission data provided by EPA's Air Markets Program Data 
database for Mill Creek for the period 2009-2013 (i.e., before the wet 
FGD replacements), Kentucky determined an adjustment factor of 0.69. 
Multiplication of this adjustment factor times the candidate 1-hour 
limit yielded the 0.20 lb/MMBtu 30-day average permit limit that 
Kentucky established in Mill Creek's title V permit effective April 5, 
2017. The period from 2009 to 2013 was a period of stable operation 
prior to the wet FGD replacements (which were made between late 2014 to 
mid-2016), a time when similar but less efficient wet FGDs were used 
for SO2 emission control for each coal-fired unit. EPA 
believes that these data were the best data available at the time to 
Kentucky for estimating the variability of emissions to be expected at 
Mill Creek upon compliance with the permit limits. At the time Kentucky 
conducted its assessment, only a small amount of post-replacement data 
was available. Use of a mix of pre-replacement and post-replacement 
data would have yielded a distorted analysis of variability. Therefore, 
the 2009 to 2013 data from Mill Creek provided the best representation 
available to Kentucky of the variability of emissions to be expected 
from this plant.
    Additionally, the 2009-2013 emissions data set yielded an 
adjustment factor slightly lower (more conservative) than the average 
30-day adjustment factor (0.71) included in Table 1 of Appendix D of 
EPA's SO2 nonattainment guidance for emission sources with 
wet scrubbers. The results provided in Appendix D were intended to 
provide insight into the range of adjustment factors that may be 
considered typical. For these reasons, EPA believes the 0.69 adjustment 
factor calculated by Kentucky is an appropriate estimate of the degree 
of adjustment needed to derive a comparably stringent 30-day average 
emission limit for this facility.
    In accordance with EPA's SO2 nonattainment guidance, the 
Commonwealth used the distribution of hourly emissions to determine a 
corresponding distribution of 30-operating day longer term emission 
averages at the end of each operating day. The 99th percentile of the 
1-hour average emission values and the 4th maximum value of the 30-day 
average emission values \20\ for each year were

[[Page 56011]]

calculated, then the average value of the five years' 99th percentile 
value was determined. The adjustment factor was calculated as the ratio 
of the 99th percentile for the longer term average to the 99th 
percentile hourly average emissions for each of the four boilers at 
Mill Creek, separately. The adjustment factors for each of the four 
units (0.64, 0.68, 0.75 and 0.68) were averaged together to arrive at a 
single compliance ratio of 0.69. The average compliance ratio was then 
applied to the 0.29 lb/MMBtu hourly emission rate to create a 
comparably stringent long term (30-day) emission limit of 0.20 lb/
MMBtu, which was imposed on each emission unit individually. EPA 
believes that use of an average adjustment factor is a suitable means 
of projecting future variability of the four units at the plant because 
the use of an average adjustment factor is likely to yield similar 
results to use of unit-specific adjustment factors; indeed, Kentucky 
determined that annual potential total SO2 emissions based 
on use of an average adjustment factor (with a limit of 0.20 lb/MMBtu 
for all units) are about 137 tpy less than would be allowed with limits 
of 0.29 lb/MMBtu adjusted by unit-specific adjustment factors.
---------------------------------------------------------------------------

    \20\ EPA notes that the SO2 nonattainment guidance 
recommends the compliance ratio be determined based on the 99th 
percentile of 30-day values instead of the 4th maximum value used by 
Kentucky. Kentucky also computed the compliance ratio using the 99th 
percentile and determined that the individual compliance ratios for 
each unit did not change because the 99th percentile values are 
close to the 4th maximum values.
---------------------------------------------------------------------------

    Based on a review of the Commonwealth's submittal and EPA's 
additional analysis described below, EPA believes that the 30-day 
average 0.20 lb/MMBtu limit for each of the four boilers at Mill Creek 
provides a suitable alternative to establishing a 1-hour average 
emission limit for each unit at this source. The Commonwealth has used 
a suitable data base and has derived an adjustment factor that yields 
an emission limit that has comparable stringency to the 1-hour average 
limit that Kentucky determined would otherwise have been necessary to 
provide for attainment. While the 30-day rolling average limit allows 
occasions in which emissions may be higher than the level that would be 
allowed with the 1-hour limit, the Commonwealth's limit compensates by 
requiring average emissions to be lower than the level that would 
otherwise have been required by a 1-hour average limit.
    EPA's SO2 nonattainment guidance recommends evaluating 
``whether the longer term average limit, potentially in combination 
with other limits, can be expected to constrain emissions sufficiently 
so that any occasions of emissions above the critical emission value 
will be limited in frequency and magnitude and, if they occur, would 
not be expected to result in NAAQS violations.'' For this purpose, EPA 
analyzed Air Markets Program Data available from EPA. Mill Creek 
completed replacements of the FGD equipment during the period from 
December 2014 to June 2016. EPA believes that the emissions data 
available after completion of the replacements are the data that best 
indicate the likely frequency of hourly emission levels above the 
critical emission value. At the time EPA conducted its analysis, these 
data were available through the end of March 2018. Therefore, in 
addition to the analysis submitted by Kentucky, EPA analyzed hourly 
emissions obtained from the EPA Air Markets Program Data for Mill Creek 
for the period April 2016 to March 2018,\21\ which encompasses the time 
after all the wet FGD replacements were completed and the facility was 
operating under a 0.20 lb/MMBtu emission limitation. During this time 
Units 1, 2 and 3 did not have any 30-day average values above 0.20 lb/
MMBtu, these units each had only 0.1 percent of the hours exceeding the 
``critical emission factor'' of 0.29 lb/MMBtu. Although Unit 4 slightly 
exceeded 0.20 lb/MMBtu approximately 5.4 percent of the 30-day averages 
during this period (based on Kentucky's compliance determination 
procedures), this unit only exceeded the ``critical emission factor'' 
of 0.29 lb/MMBtu for 0.5 percent of the hours. Therefore, EPA is 
proposing to conclude that Mill Creek can reasonably be expected to 
exceed the critical emission value only rarely. For details of this 
analysis, please refer to the spreadsheet titled ``Mill Creek Analysis 
of Values Above the Critical Emission Rate'' in the Docket for this 
proposal action.
---------------------------------------------------------------------------

    \21\ FGD replacements were not complete for Unit 3 until June 
2016, so the period analyzed for Unit 3 was from July 2016 to March 
2018.
---------------------------------------------------------------------------

    For reasons described above and explained in more detail in EPA's 
SO2 nonattainment guidance, EPA believes appropriately set 
longer term average limits provide a reasonable basis by which 
nonattainment plans may provide for attainment. Based on its review of 
this information as well as the information in the Commonwealth's plan, 
EPA proposes to find that the 30-day average limits for Mill Creek 
provide for attainment of the SO2 standard. Furthermore, EPA 
notes that 2015-2017 quality-assured and certified design value for the 
Watson Lane monitor (AQS ID: AQS ID: 21-11-0051) in the nonattainment 
area is 31 ppb, which is below the 1-hour SO2 standard.
    The Commonwealth requested EPA approve into the Jefferson County 
portion of the Kentucky SIP, the 30-day, 0.20 lb/MMBtu SO2 
emission limit for each boiler as well as operating and compliance 
parameters (monitoring and reporting requirements) established in Mill 
Creek's title V permit 145-97-TV (R3). EPA has evaluated these 
emissions limits and proposes to determine that these limits provide 
for attainment of the 2010 SO2 NAAQS.
5. Background Concentration
    Background concentrations of SO2 were included in the 
modeling using 2013-2015 season-by-hour monitoring data from the Green 
Valley Road monitor (AQS ID: 18-043-1004) located in New Albany, 
Indiana. Use of the season-by-hour data is one of the approaches for 
calculating background concentrations provided in the SO2 
nonattainment guidance. The season-by-hour background values ranged 
from 2.13 ppb to 20.67 ppb. This monitor is located approximately 29 km 
to the north of the Mill Creek facility in the vicinity of many 
SO2 emissions sources, including the Duke Energy Indiana, 
LLC, Gallagher Generating Station coal-fired power plant with 3,500 tpy 
of SO2 emissions in 2014, which is located approximately 5 
km upwind of the monitor. This source, along with other sources in the 
area upwind of the monitor (including numerous small area sources in 
the City of Louisville and the Louisville Gas and Electric Company, 
Cane Run Station power plant), emitted approximately 13,000 tpy of 
SO2 in 2014. The background concentrations from the Green 
Valley ambient air monitor were used by the Commonwealth to account for 
SO2 impacts from all sources besides the Mill Creek 
facility, which was explicitly modeled with AERMOD to develop an 
appropriate emissions limit. The Commonwealth evaluated other 
SO2 monitors in the Louisville area that are closer to the 
Mill Creek facility and the nonattainment area, including the Watson 
Lane (AQS ID: 21-111-0051), Cannons Lane (AQS ID: 21-111-0067) and 
Algonquin Parkway/Firearms Training (AQS ID: 21-111-1041) monitors. 
However, the Commonwealth determined that each of these monitors had 
issues with data completeness during the 2013-2015 timeframe and thus 
were not available for use in their modeling analysis.
    EPA is supplementing the attainment demonstration modeling provided 
by the Commonwealth with an independent analysis to assess the 
conclusion that the Green Valley background monitor adequately

[[Page 56012]]

represents background concentrations of SO2 within this 
nonattainment area, including the impact from Kosmos that is located 
outside but adjacent to the nonattainment area to the southeast of the 
Mill Creek facility. The Commonwealth states in its submission that the 
Green Valley monitor was determined to be the most appropriate and 
representative background monitor for the demonstration and that it 
accounts for impacts from all sources not explicitly modeled, including 
Kosmos. As described below, EPA's independent analysis supports KDAQ's 
conclusion that the Green Valley monitor adequately represents impacts 
from all unmodeled sources including those from Kosmos.
    EPA evaluated whether Kosmos, which is located in close proximity 
to the nonattainment area boundary (less than 0.50 km), should be 
considered a ``nearby source'' or an ``other source'' as these terms 
are defined in Section 8.3.1 of EPA's Guideline contained in 40 CFR 
part 51, Appendix W (Appendix W).\22\ Section 8.3.1.a.i of Appendix W 
discusses evaluating significant concentration gradient in the vicinity 
of the source under consideration for SIP emissions limits for 
determining if other sources in the area are adequately represented by 
background ambient monitoring. Section 8.3.3.b.ii of Appendix W further 
describes the assessment of concentration gradients and states that 
``the magnitude of a concentration gradient will be greatest in the 
proximity of the source and will generally not be significant at 
distances greater than 10 times the height of the stack(s) at that 
source without consideration of terrain influences.'' The height of the 
cement kiln stack at Kosmos is 75 feet (approximately 23 meters) and 
there are no significant terrain features located near Kosmos or within 
the nonattainment area boundary. Evaluating the concentration gradients 
for Kosmos using the ``10 times stack height'' general rule of thumb 
indicates that concentration gradients should be comparatively modest 
beyond 230 meters from the stack. The closest edge of the nonattainment 
boundary is approximately 480 meters from the stack, which is more than 
twice the distance of this general rule of thumb. Therefore, EPA 
believes that the SO2 emissions from Kosmos likely would not 
result in a significant concentration gradient within the nonattainment 
area boundary.
---------------------------------------------------------------------------

    \22\ EPA had previously indicated that Kosmos should be treated 
as a ``nearby source.'' This position was communicated to the 
Commonwealth in comments on the Prehearing Attainment Demonstration 
SIP in a letter dated April 18, 2017. EPA has subsequently performed 
additional analysis (discussed later in this section), and believes 
that it is appropriate to treat Kosmos as an ``other source,'' which 
can be addressed using a representative ambient background 
concentration. As an additional measure, Kentucky and Jefferson 
County have elected to conduct air quality monitoring to better 
characterize the ambient concentrations of SO2 in the 
vicinity of the Kosmos facility through an agreed Board Order with 
Kosmos. The Board Order, approved by Jefferson County Board on April 
19, 2017, requires the facility to deploy an ambient air monitor in 
accordance with 40 CFR part 58 and EPA's nonattainment guidance 
``SO2 NAAQS Designations Source-Oriented Monitoring 
Technical Assistance Document'' (Monitoring TAD February 2016) and 
includes a remediation plan indicating if monitored violations of 
the NAAQS occur, Kosmos agrees to make changes to their operations 
to prevent future violations. EPA Region 4 approved the monitor 
location in a letter dated February 1, 2018. Please see the Board 
Order located in the Docket for this proposed rule at EPA-R04-OAR-
2017-0625.
---------------------------------------------------------------------------

    EPA also evaluated whether the Green Valley background monitor data 
is adequately representative of potential SO2 concentration 
impacts from Kosmos within the nonattainment area. This evaluation 
consisted of an assessment of wind patterns in the Louisville area, the 
SO2 emissions sources in the vicinity of the Green Valley 
monitor, and comparing those sources to the Kosmos source. EPA 
evaluated wind data from 2011-2015 from the Louisville Standiford Field 
Airport to determine the predominant wind patterns. The results of this 
analysis show that winds blow predominately from the southeast, south 
and southwest directions. EPA then identified significant 
SO2 emissions sources located south, southeast and southwest 
of the Green Valley monitor. The Commonwealth used Green Valley ambient 
concentration data from the 2013-2015 time period for the background 
concentrations. Therefore, EPA used SO2 emissions data 
contained in the 2014 NEI to evaluate sources in the vicinity of the 
Green Valley monitor. EPA's evaluation of sources in the 2014 NEI found 
that a large coal fired power plant, the Duke Energy Indiana, LLC, 
Gallagher Generating Station, with SO2 emissions of 3,500 
tpy, is located approximately 5 km southwest of the Green Valley 
monitor. Also, the Louisville Gas and Electric Company, Cane Run 
Station reported 8,700 tpy of SO2 emissions in 2014 and is 
located approximately 15 km southwest of the Green Valley monitor. 
Further, the City of Louisville and its associated numerous small area 
SO2 emissions sources (e.g., diesel vehicles and generators) 
is located within 9 km southeast of the monitor. Combined, these 
sources total over 13,000 tpy of SO2 emissions (according to 
the 2014 NEI) located upwind of the monitor and contribute to the 
measured SO2 season-by-hour concentrations in 2013-2015 that 
ranged from 2.13 ppb to 20.67 ppb.
    EPA used its Emissions Inventory System (EIS) Gateway to obtain 
emissions data for Kosmos for comparison to the emissions sources 
impacting the Green Valley monitor. The EIS Gateway data for Kosmos 
show SO2 emissions of 207 tpy in 2014, 289 tpy in 2015, and 
364 tpy in 2016. These emissions data demonstrate that Kosmos' 
SO2 emissions are much less than the emissions sources that 
are contributing to the measured concentrations at the Green Valley 
background monitor. While Kosmos is located much closer to the 
nonattainment area boundary (approximately 0.5 km) than the distance 
the larger sources of emissions are from the Green Valley monitor (from 
5 km to 15 km), the sources near the Green Valley monitor have more 
than an order of magnitude more emissions than Kosmos. EPA believes 
that the net effect of these compensating differences is that the Green 
Valley monitor reasonably indicates the impact of Kosmos on the 
nonattainment area.
    Based upon EPA's analyses summarized above, EPA is proposing to 
concur with the Commonwealth's use of ambient SO2 
concentration data from the Green Valley monitor to account for 
potential impacts from Kosmos and all other emissions sources located 
outside the nonattainment area that were not explicitly modeled in the 
attainment demonstration modeling analysis.
6. Summary of Modeling Results
    The AERMOD modeling resulted in a maximum modeled design value of 
190.1 micrograms per cubic meter or 72.6 ppb, including the background 
concentration, which is below the 1-hour SO2 NAAQS of 75 
ppb. As discussed above, the AERMOD modeling used hourly SO2 
emissions for each stack equivalent to the hourly SO2 
emission rate of 0.29 lb/MMBtu, which was used to derive the 30-day 
average emission limit for the four coal-fired boilers at the Mill 
Creek facility. Effective June 8, 2016, the Mill Creek facility 
completed installation of improved wet FGD SO2 controls on 
all three stacks, and became subject the new 30-day SO2 
emission limits on April 5, 2017, which has reduced SO2 
emissions by approximately 89 percent from 2014 emission levels.\23\ 
Furthermore, the Watson Lane

[[Page 56013]]

monitoring data trends during the timeframe corroborate the significant 
SO2 reductions from Mill Creek facility, supporting EPA's 
view that limiting Mill Creek emissions adequately will assure 
attainment. EPA has evaluated the modeling procedures, inputs and 
results and proposes to find that the results of the Commonwealth's 
modeling analysis demonstrate that the limits on Mill Creek assure that 
there will be no violations of the NAAQS within the nonattainment area.
---------------------------------------------------------------------------

    \23\ Mill Creek annual SO2 emissions have dropped, 
from 28,149 tons in 2014 to 3,040 tons in 2017. See https://ampd.epa.gov/ampd/.
---------------------------------------------------------------------------

C. RACM/RACT

    CAA section 172(c)(1) requires that each attainment plan provide 
for the implementation of all RACM as expeditiously as practicable 
(including such reductions in emissions from existing sources in the 
area as may be obtained through the adoption, at a minimum, of RACT) 
and shall provide for attainment of the NAAQS. Additionally, 172(c)(6) 
require SIPs to contain enforceable emissions limitations and other 
control measures to ``provide for attainment'' of the NAAQS. EPA 
interprets RACM, including RACT, under section 172, as measures that a 
state determines to be reasonably available and which contribute to 
attainment as expeditiously as practicable for existing sources in the 
area.
    Kentucky's plan for attaining the 1-hour SO2 NAAQS in 
the Jefferson County SO2 nonattainment area included a 
review of three control measures as potential options which could be 
implemented at Mill Creek to reduce ambient SO2 
concentrations and attain the SO2 NAAQS: More efficient 
scrubber operation; increased stack height; and restriction of high 
sulfur fuels. The Commonwealth in coordination with the District 
determined that FGD is the appropriate control strategy and represents 
RACT/RACM for the nonattainment area. The new controls increase Mill 
Creek's ability to control SO2 emissions from previously 
permitted levels, i.e., around 90 percent, to a 98 percent removal 
rate. Emissions are expected to be reduced from actual emissions of 
29,994 tpy in 2011 to a projected post-control level of 13,489.5 tpy. 
Effective June 8, 2016, the Mill Creek facility completed installation 
of improved wet FGD SO2 controls on all three stacks, and 
became subject the new 30-day SO2 emission limits on April 
5, 2017 (discussed in section IV.B.4 above). The replaced FGD controls 
and April 5, 2017 compliance with the 30-day SO2 emission 
limits has resulted in reduced SO2 emissions at Mill Creek 
by approximately 89 percent since 2014 emission levels.\24\ 
Furthermore, the monitoring data trends during the time period 
corroborate the existence of the substantial air quality benefits from 
the significant SO2 reductions from Mill Creek facility. The 
Watson Lane monitor has recorded decreasing SO2 
concentrations from an annual 99th percentile value of 148.6 ppb in 
2014, 54.2 ppb in 2015, 26.1 ppb in 2016 and 13.7 ppb in 2017. 
Currently, the quality-assured and certified 2015-2017, 3-year design 
value for the Watson Lane monitor is 31 ppb, which is well below the 1-
hour SO2 standard. In addition to the modeling demonstrating 
attainment of the SO2 standard, actual monitored 99th 
percentile of 1-hour daily maximum concentrations at the Watson Lane do 
not show violations of the NAAQS. On this basis, Jefferson County 
determined that no additional measures could contribute to attainment 
as expeditiously as practicable. Therefore, the FGD controls for the 
Mill Creek Generating Station was determined to constitute RACT/RACM 
for the nonattainment area. Kentucky has determined that these measures 
suffice to provide for timely attainment. EPA preliminarily concurs 
with Kentucky's approach and analysis, and proposes to conclude that 
the Commonwealth has satisfied the requirement in section 172(c)(1) and 
(6) to adopt and submit all RACT/RACM and emission limitations and 
control measures as needed to attain the standard as expeditiously as 
practicable.
---------------------------------------------------------------------------

    \24\ According to the CAMD data, Mill Creek annual 
SO2 emissions have dropped, from 28,149 tons in 2014 to 
3,040 tons in 2017. See https://ampd.epa.gov/ampd/.
---------------------------------------------------------------------------

D. New Source Review (NSR)

    EPA last approved Louisville's NNSR regulations 2.04--Construction 
or Modification of Major Sources in or Impacting upon Non-Attainment 
Areas (Emissions Offset Requirements) on October 23, 2001 (66 FR 
53660). These rules provide for appropriate NSR for SO2 
sources undergoing construction or major modification in any 
nonattainment area in Jefferson County including the SO2 
nonattainment area without need for modification of the approved rules. 
Therefore, EPA proposes to conclude that this requirement is met for 
this Area through Louisville's existing NSR rules.

E. Reasonable Further Progress (RFP)

    CAA section 172(c)(2) requires attainment plan to require RFP, 
which is defined in CAA section 171(1) as ``annual incremental 
reductions in emissions of the relevant air pollutant as are required 
by this part or may reasonably be required by the Administrator for the 
purpose of ensuring attainment of the SO2 NAAQS by the 
statutory attainment date.'' For pollutants like SO2 where a 
limited number of sources affect air quality, the General Preamble and 
the SO2 nonattainment guidance explain that RFP is best 
construed as an ambitious compliance schedule. As discussed above, LG&E 
completed installation of FGD replacement scrubbers for all four coal-
fired boilers at Mill Creek on June 8, 2016 (Unit 4 new FGD went into 
service on December 9, 2014; Units 1 and 2's new FGD went into service 
on May 27, 2015; and Unit 3 \25\ new FGD went into service on June 8, 
2016) to comply with EPA's MATS extended compliance date of April 16, 
2016. However, for purposes of demonstrating attainment of the 2010 
SO2 standard, Kentucky established an independent 
SO2 emission limit of 0.20 lb/MMBtu for Mill Creek (title V 
operating permit 145-97-TV(R3) based on the SO2 emission 
reductions from the FGD replacement. All FGD controls are currently 
installed and operational at Mill Creek and the facility is currently 
complying with the 30-day emission limits as of April 5, 2017 (the date 
the revised title V permit was issued).\26\ EPA has evaluated these 
emissions limits and proposes to determine that these limits provide 
for modeled attainment of the 2010 SO2 NAAQS in the 
Jefferson County nonattainment area.
---------------------------------------------------------------------------

    \25\ Unit 3 ceased operation on April 9, 2016, to comply with 
the extended MATS compliance date and did not return to service 
until all controls and construction necessary to comply with MATS 
were completed.
    \26\ See Mill Creek Generating Station title V operating permit 
No. 145-97-TV(R3) in the Docket (ID: EPA-R04-OAR-2017-0625) for this 
proposal action.
---------------------------------------------------------------------------

    SO2 emissions within the nonattainment area have 
decreased approximately 89 percent since 2014, which correlates to a 
reduction of SO2 concentrations recorded at the Watson Lane 
monitor during this period.\27\ Kentucky finds that this plan requires 
the affected sources implement appropriate control measures as 
expeditiously as practicable to ensure attainment of the standard by 
the applicable attainment date. Mill Creek

[[Page 56014]]

has met the limits in Kentucky's plan by the April 5, 2017 compliance 
date (effective date of the new 30-day SO2 emission limits). 
Therefore, Kentucky concludes that this plan provides for RFP in 
accordance with EPA's April 2014 SO2 nonattainment guidance. 
Currently, the Watson Lane monitor 2015-2017 quality-assured and 
certified SO2 design value is below the 1-hour NAAQS at 31 
ppb, EPA expects the Area to show attainment of the 2010 standard by 
the statutory attainment date. EPA proposes to concur and concludes 
that the plan provides for RFP, as specified in the General Preamble 
and the SO2 nonattainment guidance, and therefore satisfies 
the requirements of CAA section 172(c)(2).
---------------------------------------------------------------------------

    \27\ According to CAMD data, annual SO2 emissions 
have dropped, from 28,149 tons in 2014 to 14,082 tons in 2015. 
Subsequent years have reported further reductions with 4,335 tons in 
2016 and 3,040 tons in 2017. The Watson Lane monitor (AQS ID: 21-
111-0051), located less than 2 km east of the Mill Creek facility, 
recorded decreasing SO2 concentrations from an annual 
99th percentile value of 148.6 ppb in 2014, 54.2 ppb in 2015, 26.1 
ppb in 2016 and 13.7 ppb in 2017.
---------------------------------------------------------------------------

F. Contingency Measures

    As noted above, EPA's SO2 nonattainment guidance 
describes special features of SO2 planning that influence 
the suitability of alternative means of addressing the requirement in 
section 172(c)(9) for contingency measures for SO2, such 
that an appropriate means of satisfying this requirement is for the 
Commonwealth to have a comprehensive enforcement program that 
identifies sources of violations of the SO2 NAAQS and to 
undertake an aggressive follow-up for compliance and enforcement. 
Kentucky's plan provides for satisfying the contingency measure 
requirement in this manner. Jefferson County is authorized by Kentucky 
Revised Statutes Chapter 77 to ensure that control strategies, 
including reasonably achievable control technology and contingency 
measures, necessary to attain the standard by the applicable attainment 
date are implemented in the nonattainment area. Kentucky's proposed SIP 
revision has been developed in accordance with this authority. In 
addition, if a monitored exceedance of the SO2 NAAQS occurs 
in the future and all sources are found to comply with applicable SIP 
and permit emission limits, Jefferson County will perform the necessary 
analysis to determine the cause of the exceedance, and determine what 
additional control measures are necessary to impose on the Area's 
stationary sources to continue to maintain attainment of the 
SO2 NAAQS. Jefferson County will inform any affected 
stationary sources of SO2 of the potential need for 
additional control measures. If there is a violation of the NAAQS for 
SO2 within the nonattainment area, then Jefferson County 
will notify the stationary source that the potential exists for a NAAQS 
violation. Within six months of notification, the source must submit a 
detailed plan of action specifying additional control measures to be 
implemented no later than 18 months after the notification. The 
additional control measures will be submitted to the EPA for approval 
and incorporation into the SIP. EPA preliminarily concurs and proposes 
to approve Kentucky's plan for meeting the contingency measure 
requirement as described above and in the proposed SIP revision.

V. Incorporation by Reference

    In this rule, EPA is proposing to include in a final EPA rule 
regulatory text that includes incorporation by reference. In accordance 
with requirements of 1 CFR 51.5, EPA is proposing to incorporate by 
reference into the Jefferson County portion of the Kentucky SIP, a 
SO2 emission limit and specified compliance conditions 
established in title V permit 145-97-TV(R3) for each coal-fired 
emissions unit at the LG&E Mill Creek Generating station in Jefferson 
County nonattainment area. Specifically, EPA is proposing to 
incorporate into the Jefferson County portion of the Kentucky SIP a 
0.20 lb/MMBtu 30-day SO2 emission limit for each EGU (U1, 
U2, U3 and U4) and operating and compliance conditions (monitoring, 
recordkeeping and reporting) all established at Plant-wide Specific 
condition S1-Standards, S2-Monitoring and Record Keeping and S3-
Reporting in title V permit 145-97-TV(R3) for EGU U1, U2, U3 and U4. 
The SO2 emission standards specified in the permit are the 
basis for the attainment demonstration. EPA has made, and will continue 
to make, these materials generally available through 
www.regulations.gov and at EPA Region 4 office (please contact the 
person identified in the For Further Information Contact section of 
this preamble for more information).

VI. EPA's Proposed Action

    EPA is proposing to approve Kentucky's SO2 nonattainment 
SIP submission, which the Commonwealth submitted to EPA on June 23, 
2017, for attaining the 2010 1-hour SO2 NAAQS for the 
Jefferson County nonattainment area and for meeting other nonattainment 
area planning requirements. EPA has preliminarily determined that the 
nonattainment SIP meets the applicable requirements of sections 110, 
172, 191 and 192 of the CAA and nonattainment regulatory requirements 
at 40 CFR part 51. This SO2 nonattainment plan includes 
Kentucky's attainment demonstration for the Jefferson County 
nonattainment area and other nonattainment requirements for RFP, RACT/
RACM, NNSR, base-year and projection-year emission inventories, 
enforceable emission limits and control measures and compliance 
parameters, and contingency measures. Additionally, EPA is proposing to 
approve into the Jefferson County portion of the Kentucky SIP, Mill 
Creek's enforceable SO2 emission limits and compliance 
parameters (monitoring and reporting) established at Plant-wide 
Specific condition S1-Standards, S2-Monitoring and Record Keeping and 
S3-Reporting established in title V permit 145-97-TV(R3).

VII. Statutory and Executive Orders

    Under the CAA, the Administrator is required to approve a SIP 
submission that complies with the provisions of the Act and applicable 
Federal regulations. See 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in 
reviewing SIP submissions, EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. This action merely 
proposes to approve state law as meeting Federal requirements and does 
not impose additional requirements beyond those imposed by state law. 
For that reason, this proposed action:
     Is not a significant regulatory action subject to review 
by the Office of Management and Budget under Executive Orders 12866 (58 
FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
     Is not an Executive Order 13771 (82 FR 9339, February 2, 
2017) regulatory action because SIP approvals are exempted under 
Executive Order 12866;
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     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);
     Does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the 
National

[[Page 56015]]

Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) 
because application of those requirements would be inconsistent with 
the CAA; and
     Does not provide EPA with the discretionary authority to 
address, as appropriate, disproportionate human health or environmental 
effects, using practicable and legally permissible methods, under 
Executive Order 12898 (59 FR 7629, February 16, 1994).
    The SIP is not approved to apply on any Indian reservation land or 
in any other area where EPA or an Indian tribe has demonstrated that a 
tribe has jurisdiction. In those areas of Indian country, the rule does 
not have tribal implications as specified by Executive Order 13175 (65 
FR 67249, November 9, 2000), nor will it impose substantial direct 
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
Reference, Intergovernmental relations, Reporting and recordkeeping 
requirements, Sulfur oxides.

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

    Dated: November 1, 2018.
Onis ``Trey'' Glenn, III,
Regional Administrator, Region 4.
[FR Doc. 2018-24582 Filed 11-8-18; 8:45 am]
 BILLING CODE 6560-50-P


