[Federal Register Volume 85, Number 143 (Friday, July 24, 2020)]
[Rules and Regulations]
[Pages 44738-44741]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-15220]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R05-OAR-2018-0634; FRL-10012-07-Region 5]


Air Plan Approval; Indiana; Revisions to NOX SIP Call and CAIR 
Rules

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is approving under 
the Clean Air Act (CAA) a request from the Indiana Department of 
Environmental Management (IDEM) to revise the Indiana State 
Implementation Plan (SIP) to incorporate the following: A new rule 
concerning nitrogen oxide (NOX) emissions for the ozone 
season from Electric Generating Units (EGUs) and large non-EGUs; 
revisions concerning NOX emission rate limits for specific 
source categories; the repeal of the NOX Budget Trading 
Program; and the repeal of the Clean Air Interstate Rule (CAIR) 
NOX ozone season trading program. This SIP revision will 
ensure continued compliance by EGUs and large non-EGUs with the 
requirements of the NOX SIP Call.

DATES: This final rule is effective on August 24, 2020.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-R05-OAR-2018-0634. All documents in the docket are listed on 
the www.regulations.gov website. Although listed in the index, some 
information is not publicly available, i.e., Confidential Business 
Information (CBI) or other information whose disclosure is restricted 
by statute. Certain other material, such as copyrighted material, is 
not placed on the internet and will be publicly available only in hard 
copy form. Publicly available docket materials are available either 
through www.regulations.gov or at the Environmental Protection Agency, 
Region 5, Air and Radiation Division, 77 West Jackson Boulevard, 
Chicago, Illinois 60604. This facility is open from 8:30 a.m. to 4:30 
p.m., Monday through Friday, excluding Federal holidays and facility 
closures due to COVID-19. We recommend that you telephone Eric Svingen, 
Environmental Engineer, at (312) 353-4489 before visiting the Region 5 
office.

FOR FURTHER INFORMATION CONTACT: Eric Svingen, Environmental Engineer, 
Attainment Planning and Maintenance Section, Air Programs Branch (AR-
18J), Environmental Protection Agency, Region 5, 77 West Jackson 
Boulevard, Chicago, Illinois 60604, (312) 353-4489, 
svingen.eric@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,'' 
``us,'' or ``our'' is used, we mean EPA.

I. What is the background for this final rule?

    Under the ``good neighbor provision'' of CAA section 
110(a)(2)(D)(i)(I), states are required to eliminate their significant 
contributions to air quality problems in downwind states. To address 
the good neighbor provision for progressively more protective National 
Ambient Air Quality Standards (NAAQS) for ozone and fine particulate 
matter (PM2.5), EPA published a series of regulations 
requiring eastern states, including Indiana, to comply with statewide 
budgets limiting ozone season emissions of NOX, a precursor 
to ozone, as well as annual emissions of NOX and sulfur 
dioxide (SO2), precursors to PM2.5.
    On October 27, 1998, EPA published the NOX SIP Call, 
which addressed the good neighbor provision for the 1979 ozone NAAQS by 
requiring eastern states to submit SIPs complying with statewide 
budgets for ozone season NOX emissions (63 FR 57356). The 
NOX SIP Call also established the NOX Budget 
Trading Program, an allowance trading program that states could adopt 
to meet most of their obligations under the NOX SIP Call. On 
May 12, 2005, EPA published CAIR, which addressed the good neighbor 
provision for the 1997 ozone NAAQS and 1997 PM2.5 NAAQS by 
requiring eastern states to submit SIPs complying with statewide 
budgets for ozone season NOX emissions and annual 
NOX and SO2 emissions (70 FR 25152). CAIR also 
established allowance trading programs that states could adopt to meet 
their obligations. Upon implementation of the CAIR trading program for 
ozone season NOX in 2009, EPA discontinued administration of 
the NOX Budget Trading Program. Both the NOX SIP 
Call and CAIR allowed certain sources to participate in the trading 
programs: EGUs with capacity greater than 25 megawatts; and large non-
EGUs, such as boilers and combustion turbines, with a rated heat input 
greater

[[Page 44739]]

than 250 million British thermal units (MMBtu) per hour.
    To meet the requirements of the NOX SIP Call, IDEM 
promulgated rules at 326 IAC 10-3 and 326 IAC 10-4, and to meet the 
requirements of CAIR, IDEM promulgated rules at 326 IAC 24-1, 326 IAC 
24-2, and 326 IAC 24-3. EPA approved the original versions of Indiana's 
NOX SIP Call rules and CAIR rules into the SIP on November 
8, 2001 (66 FR 56465) and October 22, 2007 (72 FR 59480), respectively; 
EPA most recently approved revised versions of these rules on November 
29, 2010 (75 FR 72956).
    On August 8, 2011, EPA published the Cross-State Air Pollution Rule 
(CSAPR), which replaced CAIR and addressed the good neighbor provision 
for the 1997 ozone NAAQS, 1997 PM2.5 NAAQS, and 2006 
PM2.5 NAAQS by establishing new statewide budgets in eastern 
states for ozone season NOX emissions and annual 
NOX and SO2 emissions (76 FR 48208). 
Participation by a state's EGUs in the CSAPR trading program for ozone 
season NOX generally addressed NOX SIP Call 
obligations for EGUs. However, CSAPR did not initially contain 
provisions allowing states to incorporate large non-EGUs into that 
trading program to meet the ongoing requirements of the NOX 
SIP Call for non-EGUs.
    Most recently, on October 26, 2016, EPA published the CSAPR Update, 
which addressed the good neighbor provision for the 2008 ozone NAAQS by 
establishing new statewide budgets in eastern states for ozone season 
NOX emissions (81 FR 74504). The CSAPR Update also expanded 
options available to states for meeting NOX SIP Call 
requirements for large non-EGUs.
    After evaluating the various options available following 
promulgation of the CSAPR Update, IDEM chose to meet NOX SIP 
Call requirements for large non-EGUs by adopting a new rule at 326 IAC 
10-2 and revising its rule at 326 IAC 10-3. The new rule at 326 IAC 10-
2 makes the portion of the state's NOX SIP Call budget 
assigned to non-EGUs enforceable without an allowance trading 
mechanism, and the revised rule at 326 IAC 10-3 provides source-by-
source emission rate limits for certain blast furnace gas-fired units 
formerly regulated under the NOX Budget Trading Program. 
IDEM also repealed its CAIR rules at 326 IAC 24-1, 326 IAC 24-2, and 
326 IAC 24-3 and its NOX Budget Trading Program rule at 326 
IAC 10-4. In its August 27, 2018 submission, IDEM requested that EPA 
approve these changes into the Indiana SIP.
    On December 17, 2018 (83 FR 64472), EPA approved a separate 
November 27, 2017 submission from IDEM, which removed 326 IAC 24-1, 326 
IAC 24-2, and portions of 326 IAC 24-3 from the Indiana SIP. Following 
the December 17, 2018 SIP action, portions of 326 IAC 24-3 are the only 
part of Indiana's CAIR rules that remain in the Indiana SIP.
    On February 21, 2020 (85 FR 10064), EPA published a direct final 
rule approving Indiana's request to modify its SIP to include the new 
rule at 326 IAC 10-2 and the revised rule at 326 IAC 10-3 and to remove 
326 IAC 10-4 and 326 IAC 24-3. The direct final rule contains a 
detailed analysis of Indiana's submittal. In the direct final rule, EPA 
stated that if adverse comments were received by March 23, 2020, the 
rule would be withdrawn and would not take effect. EPA received adverse 
comments prior to the close of the comment period; therefore, EPA 
published a withdrawal of the direct final rule on April 10, 2020 (85 
FR 20165). EPA is addressing the adverse comments in this final action, 
based upon the proposed action also published on February 21, 2020 (85 
FR 10127).

II. What are EPA's responses to comments?

    During the comment period, EPA received three comments, all of 
which are available in the docket for this action. A summary of these 
comments, and EPA's response, is provided below.
    Comment: A commenter refers to a court case involving Monsanto. 
Without further clarifying the source at issue, the commenter alleges 
that these rule revisions would allow an increase in NOX 
emissions at ``the plant''. The commenter raises concerns that hearings 
have been closed to the public and asserts that approving IDEM's 
revisions would violate the CAA by increasing EPA's regulatory 
authority.
    Response: The commenter's objection does not appear to be relevant 
to EPA's approval of Indiana's SIP submission and is therefore outside 
of the scope of this action. According to a list of affected sources 
provided by IDEM, these rule revisions would not modify any 
requirements for any Monsanto facility. Further, as discussed in EPA's 
direct final rule, the majority of these revisions either add new 
requirements, remove provisions that have no impact on emissions, or 
replace existing requirements under one rule with identical 
requirements under another rule. For two sources, ArcelorMittal Indiana 
Harbor East and US Steel Gary Works, these revisions modify emissions 
monitoring requirements, but the revisions are not expected to cause a 
change in emissions levels. The commenter did not raise any specific 
objections to EPA's conclusion that IDEM's revisions will not result in 
increased NOX emissions from affected sources. Finally, EPA 
notes that the commenter did not explain why these revisions might 
increase EPA's regulatory authority and did not explain how any 
hearings were closed to the public. In fact, there was no public 
hearing associated with the comment period for this rulemaking.
    Comment: A commenter states that ``EPA's illegal approval of these 
revisions is hampered by the Court's decision in Wisconsin v. EPA and 
New York v. EPA.'' The commenter alleges that these cases require EPA 
to consider the environmental impacts of its decisions. The commenter 
writes that ``EPA's only primary consideration should be whether the 
decision will reduce adverse impacts on human health or the 
environment, not whether it will increase economic growth or stave off 
any harm to the environment.''
    Response: The decisions apparently referenced by this commenter, 
Wisconsin v. EPA, 938 F.3d 303 (2019) and New York v. EPA, 781 Fed. 
App'x 4 (2019), both involve challenges to the CSAPR Update. In 
Wisconsin, the D.C. Circuit considered consolidated challenges from 
environmental petitioners, who argued that the rule was too lenient, as 
well as state and industry petitioners, who argued that the rule was 
too strict. The court's Wisconsin decision upheld the CSAPR Update in 
most respects but found that the rule improperly allows upwind states 
to continue their significant contributions to downwind air quality 
problems beyond attainment dates provided under the CAA. 938 F.3d at 
312-20. On this issue, the court remanded CSAPR Update to EPA. Id. at 
336. In New York, the D.C. Circuit considered a parallel challenge to 
EPA's CSAPR Close-Out, published December 21, 2018 (83 FR 65878). In 
the Close-Out, EPA determined that CSAPR Update fully addressed eastern 
states' obligations under the good neighbor provision for the 2008 
ozone NAAQS. However, consistent with the Wisconsin court's holding 
that EPA had not properly considered the CAA attainment dates, the 
court in New York vacated the Close-Out. 781 Fed. App'x at 6-7.
    The commenter does not explain how the decisions in Wisconsin or 
New York would prevent EPA from approving IDEM's revisions. Aside from 
its holding that EPA must adhere to the attainment dates when 
addressing good neighbor obligations under the 2008 ozone NAAQS, the 
D.C. Circuit in Wisconsin

[[Page 44740]]

otherwise found ``that EPA acted lawfully and rationally'' in 
promulgating the CSAPR Update. 938 F.3d at 309. In particular, the 
court in Wisconsin upheld EPA's analysis of appropriate cost-control 
levels for emissions reductions, which was the primary economic issue 
considered by the court. Id. at 322-23. The court's remand of the CSAPR 
Update was focused solely on EPA's obligation to implement emission 
reductions consistent with the attainment dates associated with the 
2008 ozone NAAQS. The Wisconsin and New York decisions have no impact 
on EPA's evaluation of NOX SIP Call requirements pertaining 
to the 1979 ozone NAAQS, or CAIR requirements pertaining to the 1997 
ozone NAAQS and 1997 PM2.5 NAAQS, which are the requirements 
being addressed under these rule revisions. In the February 21, 2020 
direct final rule, EPA appropriately addressed the environmental 
impacts of these revisions and determined that the SIP revisions would 
not result in a change to NOX emissions from Indiana EGUs or 
large non-EGUs.
    Comment: A commenter alleges that ``EPA can't approve these 
revisions because the Court vacated CSAPR Update in the Wisconsin case 
leaving EPA with a gaping regulatory hole.'' The commenter further 
asserts that the court's vacatur upended the reporting and testing 
requirements in the NOX SIP call rule. The commenter 
therefore contends that EPA cannot approve IDEM's revisions until EPA 
replaces the CSAPR Update and ``fixes the Wisconsin v. EPA and New York 
v. EPA vacatures.''
    Response: This commenter also apparently references Wisconsin v. 
EPA, 938 F.3d 303 (2019) and New York v. EPA, 781 Fed. App'x 4 (2019). 
In Wisconsin, the D.C. Circuit rejected arguments that the CSAPR Update 
should be vacated, holding that ``as a general rule, we do not vacate 
regulations when doing so would risk significant harm to the public 
health or the environment.'' 938 F.3d at 336. Because the CSAPR Update 
remains in place, there is no ``regulatory hole'' that EPA must address 
before IDEM's revisions can be approved. Further, the vacatur in New 
York involves only EPA's finding in the Close-Out that the CSAPR Update 
resolves upwind states' obligations under the good neighbor provision 
for the 2008 ozone NAAQS.
    Following EPA's approval of these revisions into the Indiana SIP, 
large non-EGUs will satisfy their ongoing obligations under the 
NOX SIP Call in a manner that does not rely on the CSAPR 
trading programs. IDEM continues to satisfy its obligations under the 
NOX SIP Call as to EGUs through participation in the CSAPR 
trading programs. Neither the Wisconsin remand nor the New York vacatur 
affect EPA's finding in the CSAPR Update that ``compliance with the 
budgets established under the CSAPR Update would satisfy the 
requirements of the NOX SIP Call'' for EGUs (81 FR 74504 at 
74571), nor have any of the monitoring and reporting requirements of 
the CSAPR Update been affected. Therefore, the decisions in Wisconsin 
or New York have not created any ``regulatory hole'' for either EGUs or 
large non-EGUs which would prevent EPA from approving these rule 
revisions.

III. What action is EPA taking?

    EPA is approving IDEM's request to modify its SIP to include the 
new rule at 326 IAC 10-2 and the revised rule at 326 IAC 10-3 and to 
remove 326 IAC 10-4 and 326 IAC 24-3.

IV. Incorporation by Reference

    In this rule, EPA is finalizing regulatory text that includes 
incorporation by reference. In accordance with requirements of 1 CFR 
51.5, EPA is finalizing the incorporation by reference of the Indiana 
Regulations described in the amendments to 40 CFR part 52 set forth 
below. EPA has made, and will continue to make, these documents 
generally available through www.regulations.gov, and at the EPA Region 
5 Office (please contact the person identified in the ``For Further 
Information Contact'' section of this preamble for more information). 
Therefore, these materials have been approved by EPA for inclusion in 
the State implementation plan, have been incorporated by reference by 
EPA into that plan, are fully federally enforceable under sections 110 
and 113 of the CAA as of the effective date of the final rulemaking of 
EPA's approval, and will be incorporated by reference in the next 
update to the SIP compilation.\1\
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    \1\ 62 FR 27968 (May 22, 1997).
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    Also in this document, as described in the amendments to 40 CFR 
part 52 set forth below, EPA is removing provisions of the EPA-Approved 
Indiana Regulations from the Indiana SIP, which is incorporated by 
reference in accordance with the requirements of 1 CFR part 51.

V. Statutory and Executive Order Reviews.

    Under the CAA, the Administrator is required to approve a SIP 
submission that complies with the provisions of the CAA and applicable 
Federal regulations. 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. Accordingly, this 
action merely approves state law as meeting Federal requirements and 
does not impose additional requirements beyond those imposed by state 
law. For that reason, this 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 (Pub. L. 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 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).
    In addition, 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 and will not impose 
substantial direct costs on tribal governments or preempt tribal law as 
specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

[[Page 44741]]

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit a report containing this action and 
other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).
    Under section 307(b)(1) of the CAA, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the appropriate circuit by September 22, 2020. Filing a petition for 
reconsideration by the Administrator of this final rule does not affect 
the finality of this action for the purposes of judicial review nor 
does it extend the time within which a petition for judicial review may 
be filed, and shall not postpone the effectiveness of such rule or 
action. This action may not be challenged later in proceedings to 
enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
reference, Intergovernmental relations, Nitrogen dioxide, Ozone, 
Particulate matter, Reporting and recordkeeping requirements, Sulfur 
oxides.

    Dated: July 9, 2020.
Kurt Thiede,
Regional Administrator, Region 5.

    For the reasons states in the preamble, the EPA amends 40 CFR part 
52 as follows:

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

0
1. The authority citation for part 52 continues to read as follows:

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


0
2. In Sec.  52.770, the table in paragraph (c) is amended by:
0
a. Revising the section entitled ``Article 10. Nitrogen Oxides Rules''; 
and
0
b. Removing the heading ``Rule 3. Clean Air Interstate Rule (CAIR) 
NOX Ozone Season Trading Program'' and the entries for ``24-
3-1'', ``24-3-2'', ``24-3-4'', and ``24-3-11''.
    The revision reads as follows:


Sec.  52.770  Identification of plan.

* * * * *
    (c) * * *

                                        EPA--Approved Indiana Regulations
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                                                    Indiana
   Indiana citation              Subject           effective       EPA approval date             Comments
                                                      date
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                                        Article 10. Nitrogen Oxides Rules
----------------------------------------------------------------------------------------------------------------
10-1..................  Nitrogen Oxides Control     6/12/1996  6/3/1997, 62 FR 30253...
                         in Clark and Floyd
                         Counties.
10-2..................  NOX Emissions from Large    8/26/2018  7/24/2020, [Insert
                         Affected Units.                        Federal Register
                                                                citation].
10-3..................  Nitrogen Oxide Reduction    8/26/2018  7/24/2020, [Insert
                         Program for Specific                   Federal Register
                         Source Categories.                     citation].
10-5..................  Nitrogen Oxide Reduction    2/26/2006  10/1/2007, 72 FR 55664..
                         Program for Internal
                         Combustion Engines
                         (ICE).
10-6..................  Nitrogen Oxides Emission    8/30/2008  11/10/2009, 74 FR 57904.
                         Limitations for
                         Southern Indiana Gas
                         and Electric Company.
 
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[FR Doc. 2020-15220 Filed 7-23-20; 8:45 am]
BILLING CODE 6560-50-P


