ENVIRONMENTAL
PROTECTION
AGENCY
40
CFR
Part
52
[
EPA­
R06­
OAR­
2005­
TX­
0023;
FRL
­
]

Approval
and
Promulgation
of
State
Implementation
Plans;
Texas;
Revisions
for
the
Mass
Emissions
Cap
and
Trade
Program
for
the
Houston/
Galveston/
Brazoria
Ozone
Nonattainment
Area
AGENCY:
Environmental
Protection
Agency
(
EPA).

ACTION:
Final
Rule.

SUMMARY:
EPA
is
approving
revisions
to
the
Texas
State
Implementation
Plan
(
SIP)

concerning
the
Mass
Emissions
Cap
and
Trade
(
MECT)
program
for
emissions
of
nitrogen
oxides
(
NOx)
in
the
Houston/
Galveston/
Brazoria
(
HGB)
ozone
nonattainment
area.

Additionally,
EPA
is
approving
several
subsections
of
Chapter
116
of
the
Texas
Administrative
Code
(
TAC)
(
Control
of
Air
Pollution
by
Permits
for
New
Construction
or
Modification)
that
provide
cross­
references
to
the
MECT
program.
EPA
is
approving
these
revisions
in
accordance
with
the
requirements
of
the
Federal
Clean
Air
Act
(
CAA).

DATE:
This
rule
is
effective
on
[
FEDERAL
REGISTER
OFFICE:
Insert
date
30
days
from
date
of
publication
in
the
Federal
Register].
2
ADDRESSES:
EPA
has
established
a
docket
for
this
action
under
Docket
ID
No.
EPA­
R06­

OAR­
2005­
TX­
0023.
All
documents
in
the
docket
are
listed
on
the
www.
regulations.
gov
web
site.
Although
listed
in
the
index,
some
information
is
not
publicly
available,
e.
g.,
CBI
or
other
information
whose
disclosure
is
restricted
by
statute.
Certain
other
material,
such
as
copyrighted
material,
is
not
placed
on
the
Internet
and
will
be
publicly
available
only
in
hard
copy
form.

Publicly
available
docket
materials
are
available
either
electronically
through
www.
regulations.
gov
or
in
hard
copy
at
the
Air
Permitting
Section
(
6PD­
R),
Environmental
Protection
Agency,
1445
Ross
Avenue,
Suite
700,
Dallas,
Texas
75202­
2733.
The
file
will
be
made
available
by
appointment
for
public
inspection
in
the
Region
6
FOIA
Review
Room
between
the
hours
of
8:
30am
and
4:
30pm
weekdays
except
for
legal
holidays.
Contact
the
person
listed
in
the
FOR
FURTHER
INFORMATION
CONTACT
paragraph
below
to
make
an
appointment.
If
possible,
please
make
the
appointment
at
least
two
working
days
in
advance
of
your
visit.
There
will
be
a
15­
cent
per
page
fee
for
making
photocopies
of
documents.
On
the
day
of
the
visit,
please
check
in
at
the
EPA
Region
6
reception
area
at
1445
Ross
Avenue,
Suite
700,
Dallas,
Texas.

The
State
submittal
related
to
this
SIP
revision,
and
which
is
part
of
the
EPA
docket,
is
also
available
for
public
inspection
at
the
State
Air
Agency
listed
below
during
official
business
hours
by
appointment:

Texas
Commission
on
Environmental
Quality,
Office
of
Air
Quality,

12124
Park
35
Circle,
Austin,
Texas
78753.
3
FOR
FURTHER
INFORMATION
CONTACT:
Adina
Wiley,
Air
Permitting
Section
(

6PDR
EPA
Region
6,
1445
Ross
Avenue,
Dallas,
Texas
75202­
2733,
telephone
214­
665­
2115,

wiley.
adina@
epa.
gov.

SUPPLEMENTARY
INFORMATION:

Throughout
this
document
wherever
"
we,"
"
us,"
or
"
our"
is
used,
we
mean
EPA.

Outline:

I.
What
action
is
EPA
taking?

II.
What
is
the
background
for
this
action?

III.
What
are
EPA's
responses
to
comments
received
on
the
proposed
action?

IV.
What
does
Federal
approval
of
a
State
regulation
mean
to
me?

V.
Statutory
and
Executive
Order
Reviews
I.
What
action
is
EPA
taking?

EPA
is
approving
as
part
of
the
SIP
revisions
to
the
MECT
program
for
NOx
emissions
in
the
HGB
ozone
nonattainment
area
(
consisting
of
Brazoria,
Chambers,
Fort
Bend,
Galveston,

Harris,
Liberty,
Montgomery,
and
Waller
counties)
published
at
Texas
Administrative
Code
(
TAC)
Title
30,
Chapter
101
General
Air
Quality
Rules,
Subchapter
H
Emissions
Banking
and
Trading,
Division
3.
EPA
is
approving
revisions
to
sections
101.350­
101.354,
and
101.360
submitted
on
January
31,
2003,
and
revisions
to
sections
101.356
and
101.359,
submitted
on
4
December
6,
2004.
EPA
is
also
approving
revisions
to
30
TAC
Chapter
116,
Control
of
Air
Pollution
by
Permits
for
New
Construction
or
Modification
that
provide
cross­
references
to
the
MECT
program.
The
revisions
to
Chapter
116
we
are
approving
are
subsections
116.111(
a)(
2)(
L),
116.115(
b)(
2)(
C)(
iii),
116.176,
116.610(
a)(
6),
and
116.615(
5)(
C),
which
were
submitted
as
a
SIP
revision
on
April
12,
2001.

As
discussed
in
our
proposed
action
at
70
FR
58117,
we
conclude
that
these
revisions
to
the
MECT
program
are
consistent
with
section
110(
l)
of
the
Clean
Air
Act.

II.
What
is
the
background
for
this
action?

The
MECT
program
was
adopted
as
a
State
regulation
on
December
6,
2000.
The
program
is
mandatory
for
most
NOx­
emitting
stationary
facilities
in
the
HGB
area.
The
program
sets
a
declining
cap
on
NOx
emissions
beginning
January
1,
2002,
with
the
final
cap
level
set
in
2007.
Each
year,
covered
facilities
receive
NOx
allowances
in
an
amount
determined
by
a
formula,
which
uses
emission
rates
established
in
30
TAC
Chapter
117.
An
allowance
is
the
authorization
to
emit
one
ton
of
NOx
during
a
control
period;
a
control
period
is
the
calendar
year.
By
March
1
each
year,
covered
facilities
must
hold
enough
NOx
allowances
to
cover
their
emissions
during
the
previous
control
period.
Facilities
may
purchase,
bank
or
sell
their
allowances.
The
MECT
program
has
a
provision
to
allow
a
facility
to
use
emission
reduction
credits
(
ERCs)
generated
through
the
TCEQ
Emission
Credit
Banking
and
Trading
program
to
permanently
increase
its
MECT
allowances,
but
only
if
the
credits
were
generated
for
NOx
in
the
HGB
area
before
December
1,
2000.
The
MECT
also
has
a
provision
to
allow
a
facility
to
use
5
discrete
emission
reduction
credits
(
DERCs)
and
mobile
discrete
emission
reduction
credits
(
MDERCs)
generated
through
the
TCEQ
Discrete
Emission
Credit
Banking
and
Trading
program
in
lieu
of
allowances
if
they
are
generated
in
the
HGB
area.
EPA
published
a
final
rule
approving
the
MECT
program
(
except
for
the
use
of
DERCs
and
MDERCs
in
the
MECT,
which
we
deferred
acting
on
until
our
action
on
the
DERC
program)
on
November
14,
2001
(
66
FR
57252).
Texas
has
subsequently
revised
the
MECT
program
in
SIP
submittals
dated
July
15,

2002,
January
31,
2003,
and
December
6,
2004.

The
MECT
allowance
allocations
and
resulting
emission
reductions
were
relied
on
in
the
HGB
attainment
demonstration
submitted
in
2000.
As
of
2000,
the
MECT
rules
were
designed
to
reduce
overall
industrial
NOx
emissions
in
the
HGB
area
by
approximately
90
percent.

Today's
action
approves
several
revisions
to
the
MECT
that
TCEQ
submitted
to
EPA
on
January
31,
2003,
and
December
6,
2004.
These
revisions
made
changes
to
support
a
shift
from
90
percent
control
of
industrial
sources
to
80
percent
control
in
the
HGB
ozone
nonattainment
area,
expanded
the
applicability
of
the
MECT,
updated
and
revised
the
provision
of
the
MECT
allowing
for
the
use
of
DERCs
and
MDERCs
in
lieu
of
MECT
allowances,
and
included
a
variety
of
non­
substantive
changes
to
correct
grammar
and
reorganize
the
rule
text
for
readability.

In
our
proposed
approval
of
the
MECT
revisions
(
70
FR
58112),
we
stated
that
final
action
on
the
MECT
would
not
occur
until
we
published
final
approval
of
the
attainment
demonstration,
which
is
being
processed
concurrently
with
this
approval.
For
a
further
6
discussion
of
the
attainment
demonstration
and
EPA's
responses
to
comments
on
this
action,

please
see
our
action
on
the
attainment
demonstration
(
EPA­
R06­
OAR­
2005­
TX­
0018).

Also
in
our
proposed
approval
of
the
MECT
revisions,
we
stated
that
the
use
of
DERCs
and
MDERCs
in
the
MECT
program
would
not
be
Federally
approved
until
we
published
approvals
of
both
section
101.356,
which
specifically
provides
for
these
uses
and
which
we
are
acting
on
here,
and
the
DERC
program
generally.
EPA
is
publishing
a
final
conditional
approval
of
the
DERC
program
concurrently
with
our
action
on
the
MECT.
Therefore,
the
use
of
DERCs
and
MDERCs
in
the
MECT
is
Federally
approved
as
of
the
effective
date
of
these
two
rules,
but
all
such
uses
must
be
consistent
with
the
conditions
of
the
DERC
conditional
approval.
The
TCEQ
will
not
approve
the
use
of
any
DERCs
that
were
generated
from
shutdowns
since
September
30,
2002,
and
the
use
of
banked
shutdown
DERCs
generated
before
September
30,

2002,
must
occur
within
five
years
from
the
date
of
the
commitment
letter.
In
addition,
with
respect
to
all
DERCs
and
MDERCs
that
are
to
be
used
in
the
MECT
program,
both
generators
and
users
of
such
credits
must
certify
to
a
waiver
of
the
Federal
statute
of
limitations.
EPA
approval
is
also
required
when
DERCs
or
MDERCs
generated
in
another
state
or
nation,
and
in
either
attainment
or
nonattainment
areas
(
other
than
the
HGB
nonattainment
areas)
are
requested
for
use
in
the
MECT
program.
Please
see
the
administrative
record
for
our
action
on
the
DERC
program
for
further
information
(
EPA­
R06­
OAR­
2005­
TX­
0029).

III.
What
are
EPA's
responses
to
comments
received
on
the
proposed
action?
7
EPA's
responses
to
comments
submitted
by
Galveston­
Houston
Association
for
Smog
Prevention
(
GHASP),
Environmental
Defense
(
Texas
Office),
the
Lone
Star
Chapter
of
the
Sierra
Club,
and
Public
Citizen
(
Texas
Office)
on
November
4,
2005,
are
as
follows.
EPA
has
summarized
the
comments
below;
the
complete
comments
can
be
found
in
the
administrative
record
for
this
action
(
EPA­
R06­
OAR­
2005­
TX­
0023).

Comment
1:
EPA
should
not
approve
revisions
to
the
SIP
that
increase
the
approved
industrial
NOx
cap
level.
Further,
GHASP
questions
the
technical
basis
for
the
alternative
Emission
Specifications
for
Attainment
Demonstrations
(
ESADs)
used
by
the
TCEQ
to
establish
the
proposed
NOx
MECT
allocations.

Response
to
Comment
1:
EPA
disagrees
with
this
comment.
First,
although
the
revisions
to
the
allocation
scheme
represent
a
reduced
level
of
control
as
compared
to
the
previous
Federally
approved
SIP,
these
revisions
will
nonetheless
result
in
industrial
NOx
emission
reductions
of
approximately
80
percent
as
compared
to
year
2000
levels.
Additionally,
the
reduction
in
NOx
emission
controls
from
90
percent
to
80
percent
will
be
countered
by
reductions
in
highly­
reactive
volatile
organic
compounds
(
HRVOCs)
to
achieve
an
equivalent
level
of
air
quality
improvement.

Second,
the
reduction
of
the
stringency
of
industrial
NOx
controls
(
from
approximately
90
percent
to
80
percent)
is
not
a
component
of
the
MECT
revisions
evaluated
in
this
rule.
The
reduction
from
90
percent
to
80
percent
control
is
actually
the
result
of
changes
to
the
emission
specifications
for
attainment
demonstrations
(
ESADs)
in
30
TAC
Chapter
117.
These
Chapter
8
117
ESADs
are
then
used
in
the
MECT
allowance
allocation
formulas
in
section
101.353.
Our
full
response
to
this
comment,
which
includes
consideration
of
the
changes
to
the
Chapter
117
ESADs
therefore
appears
in
our
action
on
the
attainment
demonstration
for
HGB
(
EPA­
R06­

OAR­
2005­
0018).
This
approach
is
logical
because
the
change
to
80
percent
industrial
NOx
controls
is
a
part
of
the
overall
HGB
attainment
strategy,
and
should
be
evaluated
in
conjunction
with
other
new
features
of
that
strategy,
principally
the
addition
of
new
controls
for
HRVOCs.

The
MECT
establishes
a
declining
cap
for
NOx
emissions
that
is
implemented
in
stages.

Both
the
90
percent
NOx
control
strategy
and
the
80
percent
NOx
control
strategy
that
replaced
it
allocate
allowances
based
on
emission
goals
that
are
a
percentage
of
the
baseline
emission
level.

Allowances
under
the
MECT
were
originally
assigned
based
on
1997,
1998,
and
1999
historical
emissions
or
permit
allowables.
Section
101.353(
a)(
3)
of
the
MECT
controls
the
pace
of
implementation
of
the
declining
cap,
while
the
revisions
to
Chapter
117
(
which
we
are
approving
in
our
separate
and
simultaneous
action
on
the
attainment
demonstration)
reduce
the
stringency
from
a
nominal
90
percent
control
to
a
nominal
80
percent
control.

The
effect
of
the
change
to
a
nominal
80
percent
control
strategy
on
the
MECT
will
be
to
authorize
a
total
number
of
MECT
allowances
in
2007
(
the
year
the
cap
reaches
its
ultimate
level)
that
is
greater
than
it
would
have
been
under
a
nominal
90
percent
strategy.
As
discussed
in
the
attainment
demonstration
rule,
however,
the
80
percent
strategy
is
consistent
with
attainment
when
combined
with
the
other
measures
described
in
the
attainment
demonstration.

Further,
the
final
MECT
allowance
total
under
the
80
percent
strategy
will
result
in
a
reduced
level
of
NOx
emissions
when
compared
to
the
present.
Therefore,
the
80
percent
control
level,
9
which
will
be
fully
implemented
after
the
2007
control
period,
still
results
in
an
actual
emissions
decrease
from
2000
levels,
and
not
an
increase
in
emissions
as
suggested
by
the
commenters.

Comment
2:
The
MECT
lacks
a
formal
oversight
mechanism
sufficient
to
address
potential
environmental
justice
concerns.
The
audit
provisions
in
section
101.311
do
not
specifically
provide
for
an
evaluation
of
the
geographic
distribution
of
NOx
allowances,
and
even
if
a
provision
were
included
in
the
audit,
this
would
not
address
concerns
that
environmental
justice
issues
be
resolved
in
a
timely
manner.
Specifically,
GHASP
is
concerned
about
the
scenario
in
which
large
amounts
of
NOx
MECT
allowances
could
be
traded
into
Harris
County
and
combine
with
the
large
amounts
of
reactive
VOC
emissions
in
the
same
area.
This
could
result
in
higher
ozone
levels
than
predicted
by
current
modeling.
EPA
should
also
consider
requiring
TCEQ
to
establish
a
separate
trading
zone
for
Harris
County
to
address
environmental
justice
concerns.

Response
to
Comment
2:
EPA
disagrees
that
an
additional
formal
oversight
mechanism
for
Harris
County
NOx
levels
is
needed
to
protect
the
region
from
environmental
justice
concerns.
The
MECT
is
a
trading
program
involving
primarily
emissions
of
NOx,
although
section
101.356(
h)
does
provide
that
VOC
DERCs
or
MDERCs
can
be
used
in
lieu
of
NOx
allowances
if
a
demonstration
has
been
made
and
approved
by
the
TCEQ
Executive
Director
and
EPA.
Environmental
justice
concerns
can
arise
when
a
final
EPA
rule,
such
as
a
trading
program,
could
result
in
disproportionate
burdens
on
particular
communities,
including
minority
or
low
income
communities.
Using
this
definition,
environmental
justice
concerns
can
only
arise
when
there
is
a
potential
for
particular
communities
to
be
affected
differently
from
the
10
surrounding
areas.
This
can
occur
for
VOC
programs
because
some
VOC
emissions
have
toxic
components
that
can
affect
discrete
areas.

While
EPA
has
acknowledged,
at
section
4.2(
b)
of
"
Improving
Air
Quality
with
Economic
Incentive
Programs"
(
EPA­
452/
R­
01­
001,
January
2001)
(
EIP
Guidance),
that
programs
that
allow
trading
of
VOCs
can
result
in
localized
increases
of
VOCs,
the
MECT
program
is
designed
to
avoid
such
increases.
In
particular,
as
discussed
in
our
July
23,
2001,

MECT
proposal
(
66
FR
38240),
the
use
of
VOC
reductions
in
place
of
NOx
allowances
under
the
MECT
can
only
drive
VOC
emissions
lower.
That
is,
because
the
only
involvement
of
VOCs
in
the
MECT
program
is
the
substitution
of
VOC
decreases
for
NOx
increases,
there
is
no
scenario
under
which
this
program
could
allow
higher
VOC
emissions
than
would
otherwise
occur.

Moreover,
NOx
(
the
focus
of
the
MECT
program)
is
an
area­
wide
pollutant
present
throughout
the
HGB
area,
and
therefore
the
trades
of
NOx
emissions
pursuant
to
the
MECT
would
not
disproportionately
impact
a
local
community.
Therefore,
the
HGB
MECT
does
not
have
the
potential
to
cause
environmental
justice
concerns.

Further,
the
use
of
VOC
DERCs
or
MDERCs
in
the
MECT
is
subject
to
the
stringent
retirement
ratios
of
section
101.356(
h),
which
may
result
in
more
DERCs
being
retired
than
allowances
used.
Users
of
VOC
DERCs
and
MDERCs
must
also
obtain
prior
approval
from
the
TCEQ
according
to
section
101.376.
The
TCEQ
will
consider
potential
environmental
justice
concerns
during
this
approval
process.
11
For
the
above
reasons,
EPA
concludes
that
the
use
of
VOC
DERCs
and
MDERCs
in
the
MECT
will
not
lead
to
a
disproportionate
impact
on
communities
of
concern.

Although
we
disagree
that
the
MECT
raises
environmental
justice
concerns,
GHASP's
comment
about
the
potential
for
high
levels
of
ozone
forming
in
Harris
County
is
relevant
to
the
future
control
strategy
in
the
HGB
area.
The
future
MECT
and
HECT
audits
should
closely
analyze
the
interaction
of
the
two
programs
and
their
combined
impact
on
the
HGB
area.

Because
of
our
conclusion
that
a
NOx
trading
program
does
not
raise
particular
environmental
justice
issues,
we
also
disagree
that
the
MECT
program
requires
additional
oversight
in
order
to
address
potential
environmental
justice
concerns
in
a
timely
manner.
As
approved
by
EPA
on
November
14,
2001
(
66
FR
57252),
the
MECT
does
have
a
formal
audit
provision
that
provides
sufficient
oversight
to
identify
and
address
potential
areas
of
concern.

This
audit
provision
is
in
section
101.363(
a)
of
the
MECT
rules
and
requires
TCEQ
to
conduct
an
audit
every
three
years,
beginning
in
2004.
The
audit
will
evaluate
the
impact
of
the
program
on
the
State's
ozone
attainment
demonstration,
the
availability
and
cost
of
allowances,

compliance
by
the
participants,
and
any
other
elements
the
TCEQ
Executive
Director
may
choose
to
include.
The
TCEQ
Executive
Director
will
recommend
measures
to
remedy
any
problems
identified
during
the
audit,
including
discontinuing
allowance
trading
and
use
of
discrete
emission
reduction
credits
and
mobile
discrete
emission
reduction
credits.
The
audit
data
and
results
must
be
completed
and
submitted
to
EPA
and
made
available
for
public
inspection
within
6
months
from
the
beginning
of
the
audit.
TCEQ's
first
MECT
audit,
finalized
in
May
2006,
is
included
in
the
administrative
record
for
this
rulemaking
action.
12
The
MECT
audit
provisions
described
above
are
consistent
with
EPA's
expectations
for
evaluating
the
results
of
an
economic
incentive
program
(
EIP),
as
outlined
in
section
5.3(
b)
of
the
EIP
Guidance.
Section
5.3(
b)
explains
that
an
appropriate
schedule
for
program
evaluations
is
at
least
every
three
years,
which
coincides
with
other
periodic
reporting
requirements
such
as
those
applicable
to
emission
inventory
requirements
required
by
the
CAA.
EPA
believes
that
the
triennial
MECT
audit
schedule
and
the
required
annual
report
(
section
101.363(
b))
that
summarizes
all
MECT
trades
completed
in
the
most
recent
control
period
will
be
sufficient
to
ensure
the
MECT
does
not
jeopardize
the
HGB
area's
attainment
strategy.
Also,
we
note
that
the
MECT
audit
may
in
any
case
consider
environmental
justice,
because
section
101.363(
a)(
1)

provides
that
the
audit
may
address
"
any
other
elements
the
executive
director
may
choose
to
include."

As
noted,
we
disagree
with
the
commenters
that
the
MECT
program
raises
any
environmental
justice
concerns.
In
addition,
we
disagree
with
their
assertion
that
an
increase
in
ozone
formation
resulting
from
large
amounts
of
NOx
and
HRVOC
emissions
is
an
issue
of
significant
concern.
We
have
reviewed
the
audit
results
for
the
2002
and
2003
control
periods,

which
show
that
MECT­
subject
facilities
in
all
counties
except
Liberty
County
significantly
reduced
their
total
NOx
emissions
from
the
historical
baseline.
Actual
emissions
in
Harris
County
were
reduced
by
47.1
percent
from
the
historical
baseline
in
2002
and
62.2
percent
from
the
historical
baseline
in
2003.
Actual
emissions
in
2003
for
the
entire
HGB
area
were
approximately
86,693
tons;
which
is
already
lower
than
the
total
amount
of
2005
allocations
of
approximately
87,159
tons.
TCEQ
expects
this
trend
to
continue
in
future
control
periods
as
13
further
reductions
are
implemented.
Therefore,
it
is
reasonable
to
conclude
that
under
the
MECT
program
Harris
County
will
not
have
an
increase
in
NOx
emissions
that
could
result
in
increased
ozone
formation.
Additionally,
EPA
continues
to
support
TCEQ's
attainment
strategy
for
HGB
where
the
MECT
and
HECT
are
integral
to
reducing
levels
of
ozone.
The
administrative
record
for
our
final
action
on
the
HGB
attainment
demonstration
may
be
found
at
docket
number
EPAR06
OAR­
2005­
TX­
0018.

Finally,
EPA
also
disagrees
that
a
separate
trading
zone
should
be
established
for
Harris
County
to
address
environmental
justice
concerns.
First,
as
mentioned
above,
if
and
when
VOC
DERCs
and
MDERCs
are
requested
for
use
in
lieu
of
NOx
allowances
the
TCEQ
will
consider
potential
environmental
justice
concerns
during
the
approval
process
for
such
uses.
(
And
in
any
case,
as
discussed
previously,
such
use
of
VOC
reductions
in
lieu
of
NOx
allowances
can
only
drive
VOC
emissions
lower.)
Second,
EPA
has
determined
that
NOx
emissions
are
a
concern
for
the
entire
HGB
ozone
nonattainment
area.
Therefore,
it
is
reasonable
and
appropriate
to
establish
a
cap­
and­
trade
program
for
the
entire
nonattainment
area.

EPA's
response
to
BCCA
Appeal
Group
(
BCCAAG)
and
Texas
Industry
Project
(
TIP)

comments
made
on
November
4,
2005
is
as
follows:

Comment:
BCCA
Appeal
Group
and
TIP
support
EPA's
proposed
approval
of
the
revisions
to
the
MECT
program
and
urge
EPA
to
finalize
its
approval
as
soon
as
practicable.
14
Response:
EPA
acknowledges
the
support
of
BCCAAG
and
TIP
for
our
approval
of
revisions
to
the
MECT.

IV.
What
does
Federal
approval
of
a
State
regulation
mean
to
me?

Enforcement
of
the
State
regulation
before
and
after
it
is
incorporated
into
the
Federally
approved
SIP
is
primarily
a
State
function.
However,
once
the
regulation
is
Federally
approved,

the
EPA
and
the
public
may
take
enforcement
action
against
violators
of
these
regulations.
In
addition,
only
regulations
that
have
been
Federally
approved
can
be
credited
toward
an
area's
attainment
or
rate
of
progress
plan.
EPA
is
approving
the
revisions
to
the
1­
hour
ozone
attainment
plan
for
the
HGB
area
to
shift
the
control
strategy
from
approximately
90
percent
control
of
industrial
NOx
emissions
to
80
percent
control
(
please
see
EPA­
R06­
OAR­
2005­
TX­

0018).
The
revisions
to
the
MECT
enable
the
shift
in
the
control
strategy,
and
therefore
must
be
approved
with
the
attainment
demonstration.

V.
Statutory
and
Executive
Order
Reviews
Under
Executive
Order
12866
(
58
FR
51735,
October
4,
1993),
this
action
is
not
a
"
significant
regulatory
action"
and
therefore
is
not
subject
to
review
by
the
Office
of
Management
and
Budget.
For
this
reason,
this
action
is
also
not
subject
to
Executive
Order
13211,
"
Actions
Concerning
Regulations
That
Significantly
Affect
Energy
Supply,
Distribution,

or
Use"
(
66
FR
28355,
May
22,
2001).
This
action
merely
approves
State
law
as
meeting
Federal
requirements
and
imposes
no
additional
requirements
beyond
those
imposed
by
State
15
law.
Accordingly,
the
Administrator
certifies
that
this
rule
will
not
have
a
significant
economic
impact
on
a
substantial
number
of
small
entities
under
the
Regulatory
Flexibility
Act
(
5
U.
S.
C.

601
et
seq.).
Because
this
rule
approves
pre­
existing
requirements
under
State
law
and
does
not
impose
any
additional
enforceable
duty
beyond
that
required
by
State
law,
it
does
not
contain
any
unfunded
mandate
or
significantly
or
uniquely
affect
small
governments,
as
described
in
the
Unfunded
Mandates
Reform
Act
of
1995
(
Public
Law
104­
4).

This
rule
also
does
not
have
tribal
implications
because
it
will
not
have
a
substantial
direct
effect
on
one
or
more
Indian
tribes,
on
the
relationship
between
the
Federal
Government
and
Indian
tribes,
or
on
the
distribution
of
power
and
responsibilities
between
the
Federal
Government
and
Indian
tribes,
as
specified
by
Executive
Order
13175
(
65
FR
67249,
November
9,
2000).
This
action
also
does
not
have
Federalism
implications
because
it
does
not
have
substantial
direct
effects
on
the
States,
on
the
relationship
between
the
national
government
and
the
States,
or
on
the
distribution
of
power
and
responsibilities
among
the
various
levels
of
government,
as
specified
in
Executive
Order
13132
(
64
FR
43255,
August
10,
1999).
This
action
merely
approves
a
State
rule
implementing
a
Federal
standard,
and
does
not
alter
the
relationship
or
the
distribution
of
power
and
responsibilities
established
in
the
CAA.
This
rule
also
is
not
subject
to
Executive
Order
13045,
A
Protection
of
Children
from
Environmental
Health
Risks
and
Safety
Risks
@

(
62
FR
19885,
April
23,
1997),
because
it
is
not
economically
significant.

In
reviewing
SIP
submissions,
EPA
=

s
role
is
to
approve
State
choices,
provided
that
they
meet
the
criteria
of
the
CAA.
In
this
context,
in
the
absence
of
a
prior
existing
requirement
for
16
the
State
to
use
voluntary
consensus
standards
(
VCS),
EPA
has
no
authority
to
disapprove
a
SIP
submission
for
failure
to
use
VCS.
It
would
thus
be
inconsistent
with
applicable
law
for
EPA,

when
it
reviews
a
SIP
submission,
to
use
VCS
in
place
of
a
SIP
submission
that
otherwise
satisfies
the
provisions
of
the
CAA.
Thus,
the
requirements
of
section
12(
d)
of
the
National
Technology
Transfer
and
Advancement
Act
of
1995
(
15
U.
S.
C.
272
note)
do
not
apply.
This
rule
does
not
impose
an
information
collection
burden
under
the
provisions
of
the
Paperwork
Reduction
Act
of
1995
(
44
U.
S.
C.
3501
et
seq.).

The
Congressional
Review
Act,
5
U.
S.
C.
section
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
rule
and
other
required
information
to
the
U.
S.

Senate,
the
U.
S.
House
of
Representatives,
and
the
Comptroller
General
of
the
United
States
prior
to
publication
of
the
rule
in
the
Federal
Register.
A
major
rule
cannot
take
effect
until
60
days
after
it
is
published
in
the
Federal
Register.
This
action
is
not
a
A
major
rule
@

as
defined
by
5
U.
S.
C.
section
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
[
FEDERAL
REGISTER
OFFICE:
insert
date
60
days
from
date
of
publication
of
this
document
in
the
Federal
Register].
Filing
a
petition
for
reconsideration
by
the
Administrator
of
this
final
rule
does
not
affect
the
finality
of
this
rule
for
the
purposes
of
judicial
review
nor
does
it
extend
the
17
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
40
CFR
Part
52
Environmental
protection,
Air
pollution
control,
Intergovernmental
relations,
Nitrogen
oxides,
Ozone,
Reporting
and
recordkeeping
requirements,
Volatile
organic
compounds.

Dated:
August
24,
2006
Richard
E.
Greene,

Regional
Administrator,
Region
6.
18
40
CFR
part
52
is
amended
as
follows:

PART
52­­[
AMENDED]

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

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

Subpart
SS
­
Texas
2.
The
table
in
§
52.2270(
c)
entitled
"
EPA
Approved
Regulations
in
the
Texas
SIP"
is
amended:

a.
Under
Chapter
101
 
General
Air
Quality
Rules,
Subchapter
H
 
Emissions
Banking
and
Trading,
Division
3
 
Mass
Emissions
Cap
and
Trade
Program,
by
revising
the
entries
for
sections
101.350,
101.351,
101.352,
101.353,
101.354,
101.356,
101.358,
101.359,

101.360
and
101.363;

b.
Under
Chapter
116
(
Reg
6)
 
Control
of
Air
Pollution
by
Permits
for
New
Construction
or
Modification,
Subchapter
B
 
New
Source
Review
Permits,
Division
1
 
Permit
Applications,
by
revising
the
entries
for
sections
116.111
and
116.115;

c.
Under
Chapter
116
(
Reg
6)
 
Control
of
Air
Pollution
by
Permits
for
New
Construction
or
Modification,
Subchapter
B
 
New
Source
Review
Permits,
Division
7
 
Emission
Reductions:
Offsets,
by
revising
the
entry
for
section
116.170
and
by
adding
a
new
entry
for
section
116.176;
19
d.
Under
Chapter
116
(
Reg
6)
 
Control
of
Air
Pollution
by
Permits
for
New
Construction
or
Modification,
Subchapter
F
 
Standard
Permits,
by
revising
the
entries
for
sections
116.610
and
116.615.

The
addition
and
revisions
read
as
follows:

§
52.2270
Identification
of
plan.

*
*
*
*
*

(
c)
*
*
*

EPA
Approved
Regulations
in
the
Texas
SIP
State
Citation
Title/
Subject
State
approval
/
submittal
date
EPA
approval
date
Explanation
Chapter
101
 
General
Air
Quality
Rules
*
*
*
*
*
*
*
Subchapter
H
 
Emissions
Banking
and
Trading
*
*
*
*
*
*
*
Division
3
 
Mass
Emissions
Cap
and
Trade
Program
Section
101.350
Definitions
12/
13/
02
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
Section
101.351
Applicability
12/
13/
02
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
20
document
begins]
Section
101.352
General
Provisions
12/
13/
02
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
Section
101.353
Allocation
of
Allowances
12/
13/
02
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
Section
101.354
Allowance
Deductions
12/
13/
02
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
Section
101.356
Allowance
Banking
and
Trading
11/
10/
04
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
Section
101.358
Emission
Monitoring
and
Compliance
Demonstration
12/
06/
00
11/
14/
01,
66
FR
57252
Section
101.359
Reporting
11/
10/
04
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
Section
101.360
Level
of
Activity
Certification
12/
13/
02
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
Section
101.363
Program
Audits
and
Reports
09/
26/
01
11/
14/
01,
66
FR
57252
*
*
*
*
*
*
*
21
Chapter
116
(
Reg
6)
 
Control
of
Air
Pollution
by
Permits
for
New
Construction
or
Modification
*
*
*
*
*
*
*
Subchapter
B
 
New
Source
Review
Permits
Division
1
 
Permit
Application
*
*
*
*
*
*
*
Section
116.111
General
Application
03/
07/
01
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
The
SIP
does
not
include
subsections
116.111(
a)(
2)(
K)
and
116.111(
b).

*
*
*
*
*
*
*
Section
116.115
General
and
Special
Conditions
11/
20/
02
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
The
SIP
does
not
include
subsection
116.115(
c)(
2)(
B)(
ii)(
I).

*
*
*
*
*
*
*
Division
7
 
Emission
Reductions:
Offsets
Section
116.170
Applicability
of
Reduction
Credits
06/
17/
98
09/
18/
02,
67
FR
58697
The
SIP
does
not
include
section
116.170(
2).
Section
116.176
Use
of
Mass
Cap
Allowances
for
Offsets
03/
07/
01
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
*
*
*
*
*
*
*
Subchapter
F:
Standard
Permits
*
*
*
*
*
*
*
Section
116.610
Applicability
03/
07/
01
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
The
SIP
does
not
include
subsection
116.610(
d).

*
*
*
*
*
*
*
Section
116.615
General
Conditions
03/
07/
01
[
Insert
date
of
FR
publication]
[
Insert
FR
page
number
where
document
begins]
22
*
*
*
*
*
*
*
