
[Federal Register Volume 81, Number 88 (Friday, May 6, 2016)]
[Proposed Rules]
[Pages 27382-27386]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-10739]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R06-OAR-2012-0022; FRL-9946-11-Region 6]


Approval and Promulgation of Implementation Plans; Louisiana; 
Permitting of Greenhouse Gases

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
partially approve and partially disapprove a revision to the Louisiana 
State Implementation Plan (SIP) submitted by the State of Louisiana on 
December 21, 2011. This revision outlines the State's program to 
regulate and permit emissions of greenhouse gases (GHGs) in the 
Louisiana Prevention of Significant Deterioration (PSD) program. We are 
proposing to approve those provisions to the extent that they address 
the GHG permitting requirements for sources already subject to PSD for 
pollutants other than GHGs. We are proposing to disapprove those 
provisions to the extent they require PSD permitting for sources that 
emit only GHGs above the thresholds triggering the requirement to 
obtain a PSD permit since that is no longer consistent with federal 
law. The EPA is proposing this action under section 110 and part C of 
the Clean Air Act (CAA or Act).

DATES: Written comments must be received on or before June 6, 2016.

ADDRESSES: Submit your comments, identified by Docket No. EPA-R06-OAR-
2012-0022, at http://www.regulations.gov or via email to 
wiley.adina@epa.gov. Follow the online instructions for submitting 
comments. Once submitted, comments cannot be edited or removed from 
Regulations.gov. The 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. The 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, please contact Ms. Adina Wiley, (214) 
665-2115, wiley.adina@epa.gov. For 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.
    Docket: The index to the docket for this action is available 
electronically at www.regulations.gov and in hard copy at the EPA 
Region 6, 1445 Ross Avenue, Suite 700, Dallas, Texas. While all 
documents in the docket are listed in the index, some information may 
be publicly available only at the hard copy location (e.g., copyrighted 
material), and some may not be publicly available at either location 
(e.g., CBI). FOR FURTHER INFORMATION CONTACT: Adina Wiley, (214) 665-
2115, wiley.adina@epa.gov. To inspect the hard copy materials, please 
schedule an appointment with Ms. Wiley or Mr. Bill Deese at 214-665-
7253.

SUPPLEMENTARY INFORMATION: Throughout this document wherever

[[Page 27383]]

``we,'' ``us,'' or ``our'' is used, we mean the EPA.

I. Background

    On January 2, 2011, GHGs became subject to regulation under the 
Clean Air Act and thus regulated under the PSD permitting program. See 
75 FR17004, April 2, 2010. To establish a process for phasing in the 
permitting requirements for stationary sources of GHGs under the CAA 
PSD and title V programs, on June 3, 2010, the EPA promulgated a final 
rule ``Prevention of Significant Deterioration and Title V Greenhouse 
Gas Tailoring Rule'' (referred to as the Tailoring Rule). See 75 FR 
31514. The Louisiana Department of Environmental Quality (LDEQ) adopted 
revisions to the Louisiana Administrative Code on April 20, 2011, to 
address the PSD permitting requirements for sources with GHG emissions. 
These revisions, which included content from the Tailoring Rule, were 
submitted to the EPA on December 21, 2011, for inclusion in the 
Louisiana SIP. Specifically, the LDEQ submitted new definitions for 
``carbon dioxide equivalent emissions (CO2e),'' ``greenhouse 
gases (GHGs)'' and revisions to the existing definitions of ``major 
stationary source'' and ``significant'' at LAC 33:III.509(B). The 
submittal also included revisions to the general permitting program 
requirements at LAC 33:III.501(C)(14) to limit the regulation of GHGs 
under Louisiana's SIP to match any future changes in federal law or 
decisions by the Supreme Court or U.S. Court of Appeals for the D.C. 
Circuit. The December 21, 2011 submittal also included revisions to the 
Louisiana title V program at LAC 33:III.502 which is not a part of the 
SIP requirements under section 110 of the Act and will be addressed by 
the EPA in a separate action at a later date.

II. The EPA's Evaluation

    In Step 1 of the Tailoring Rule, which began on January 2, 2011, 
the EPA limited application of PSD and title V requirements to sources 
only if they were subject to PSD or title V ``anyway'' due to their 
emissions of pollutants other than GHGs. These sources are referred to 
as ``anyway sources.'' Under its understanding of the CAA at the time, 
the EPA believed the Tailoring Rule was necessary to avoid a sudden and 
unmanageable increase in the number of sources that would be required 
to obtain PSD and title V permits under the CAA because the sources 
emitted GHGs over applicable major source and major modification 
thresholds.
    In Step 2 of the Tailoring Rule, which began on July 1, 2011, the 
PSD and title V permitting requirements under the CAA applied to some 
sources that were classified as major, and, thus, required to obtain a 
permit, based solely on their GHG emissions or potential to emit GHGs, 
and to modifications of otherwise major sources that required a PSD 
permit because they increased only GHG emissions above the level in the 
EPA regulations. We generally describe the sources covered by PSD 
during Step 2 of the Tailoring Rule as ``Step 2 sources.''
    On June 23, 2014, the U.S. Supreme Court issued a decision in 
Utility Air Regulatory Group (UARG) v. EPA, 134 S. Ct. 2427, addressing 
the application of stationary source permitting requirements to GHG 
emissions. The Supreme Court held that the EPA may not treat GHGs as an 
air pollutant for the specific purpose of determining whether a source 
is a major source (or a modification thereof) and thus require the 
source to obtain a PSD or title V permit. The Court also said that the 
EPA could continue to require that PSD permits for emissions of 
pollutants other than GHGs contain limitations on GHG emissions based 
on the application of Best Available Control Technology (BACT). With 
respect to PSD, the ruling effectively upheld PSD permitting 
requirements for GHG emissions under Step 1 of the Tailoring Rule for 
``anyway sources'' and invalidated PSD permitting requirements for Step 
2 sources. In accordance with the Supreme Court decision, on April 10, 
2015, the U.S. Court of Appeals for the District of Columbia Circuit 
(the D.C. Circuit) issued an Amended Judgment vacating the regulations 
that implemented Step 2 of the Tailoring Rule, but not the regulations 
that implement Step 1 of the Tailoring Rule. The amended judgment 
preserves, without the need for additional rulemaking by the EPA, the 
application of the BACT requirement to GHG emissions from Step 1 or 
``anyway sources.'' With respect to Step 2 sources, the D.C. Circuit's 
judgment ordered that the EPA regulations under review (including 40 
CFR 51.166(b)(48)(v) and 40 CFR 52.21(b)(49)(v)) be vacated ``to the 
extent they require a stationary source to obtain a PSD permit if 
greenhouse gases are the only pollutant (i) that the source emits or 
has the potential to emit above the applicable major source thresholds, 
or (ii) for which there is a significant emissions increase from a 
modification.''
    The EPA promulgated a final rule on August 19, 2015, removing the 
portions of the PSD permitting provisions for Step 2 sources from the 
federal regulations that the D.C. Circuit specifically identified as 
vacated (40 CFR 51.166(b)(48)(v) and 52.21(b)(49)(v)). See 80 FR 50199. 
We no longer have the authority to conduct PSD permitting for Step 2 
sources, nor can we approve provisions submitted by a state for 
inclusion in their SIP providing this authority.

A. Evaluation of the Louisiana Automatic Rescission Provisions

    Louisiana's December 21, 2011 SIP submission submittal adds 
automatic rescission provisions to the State's PSD regulations at LAC 
33:III.501(C)(14). The automatic rescission provisions provide that in 
the event that there is a change in federal law, or the D.C. Circuit or 
the U.S. Supreme Court issues an order which limits or renders 
ineffective the regulation of GHGs under title I of the CAA, then the 
corresponding provisions of the Louisiana PSD program shall be limited 
or rendered ineffective to the same extent.
    The EPA is proposing to approve the Louisiana automatic rescission 
provisions. In assessing the approvability of automatic rescission 
provisions, the EPA considers two key factors: (1) Whether the public 
will be given reasonable notice of any change to the SIP that occurs as 
a result of the automatic rescission provisions, and (2) whether any 
future change to the SIP that occurs as a result of the automatic 
rescission provisions would be consistent with the EPA's interpretation 
of the effect of the triggering action on federal GHG permitting 
requirements. See, e.g., 79 FR 8130 (February 11, 2014) and 77 FR 12484 
(March 1, 2012). These criteria are derived from the SIP revision 
procedures set forth in the CAA and federal regulations.
    Regarding public notice, CAA section 110(l) provides that any 
revision to a SIP submitted by a State to EPA for approval ``shall be 
adopted by such State after reasonable notice and public hearing.'' In 
accordance with CAA section 110(l), LDEQ followed applicable notice-
and-comment procedures prior to adopting the automatic rescission 
provisions. Thus, the public is on notice that the automatic rescission 
provisions in the Louisiana PSD program will enable the Louisiana PSD 
program and the Louisiana SIP to update automatically to reflect any 
order by a federal court or any change in federal law that limits or 
renders ineffective the regulation of GHGs under the CAA's PSD 
permitting program. Additionally, the EPA interprets this provision to 
require the

[[Page 27384]]

LDEQ to provide notice to the general public and regulated community of 
the changes to the Louisiana PSD program in the event that the 
automatic rescission provision is triggered. The EPA invites comment, 
particularly from the State, regarding this interpretation.
    The EPA's consideration of whether any SIP change resulting from 
Louisiana's automatic rescission provisions would be consistent with 
the EPA's interpretation of the effect of the triggering action on 
federal GHG permitting requirements is based on 40 CFR 51.105, which 
states that ``[r]evisions of a plan, or any portion thereof, will not 
be considered part of an applicable plan until such revisions have been 
approved by the Administrator in accordance with this part.'' To be 
consistent with 40 CFR 51.105, any automatic SIP change resulting from 
a court order or federal law change must be consistent with the EPA's 
interpretation of the effect of such order or federal law change on GHG 
permitting requirements. We interpret this provision to mean that 
Louisiana will wait for and follow the EPA's interpretation as to the 
impact of any federal law change or the D.C. Circuit or the U.S. 
Supreme Court issues an order before Louisiana's SIP would be changed. 
In the event of a court decision or federal law change that triggers 
(or likely triggers) application of Louisiana's automatic rescission 
provisions, the EPA intends to promptly describe the impact of the 
court decision or federal law change on the enforceability of its GHG 
permitting regulation. The EPA invites comment, particularly from the 
State, regarding this interpretation.

B. Evaluation of the Submitted Revisions to the Louisiana PSD Program

    Prior to the court decisions, the State submitted amended PSD 
provisions to enable permitting Step 1 and Step 2 sources and the GHG 
emissions from such sources on December 21, 2011. The EPA has an 
obligation under section 110 of the CAA to act upon a submitted 
revision to a state's SIP within 18 months of receipt. The December 21, 
2011 SIP revisions have not been withdrawn; therefore, the EPA has an 
obligation to act on the submitted provisions. We have the authority 
under section 110(k)(3) of the Act to partially approve and partially 
disapprove portions of a SIP submittal that are not wholly approvable. 
Accordingly, we find it appropriate to propose partial approval under 
section 110(k)(3) of the Act of the submitted provisions that enable 
the State to permit GHG emissions from Step 1 sources consistent with 
federal requirements. Simultaneously, we are proposing disapproval of 
the provisions that enable the permitting of Step 2 sources under the 
PSD program.
    Our evaluation finds that the revised rules in Louisiana's December 
21, 2011 SIP submission achieve the same result as the Step 1 
permitting provisions in 40 CFR 51.166 that remain applicable at this 
time. However, the state rules achieve this result in a manner that 
differs from the way the EPA's regulations are presently written. The 
state has not enacted limitations on the meaning of the term ``subject 
to regulation'' as reflected in 40 CFR 51.166(b)(48)(iv). Instead, the 
State has adopted a significance level for GHGs whereby the net 
emissions increase of GHGs calculated on a mass basis equals or exceeds 
0 tpy and the net emission increase of GHGs calculated on a 
CO2e basis is 75,000 tons per year CO2e for new 
major stationary sources or major modifications, which applies to 
determine whether the BACT requirement applies to GHGs in PSD 
permitting. Although the Louisiana SIP submission is structured 
differently than the EPA's federal rules, the primary practical effect 
of both is the same: The PSD BACT requirement does not apply to GHG 
emissions from an ``anyway source'' unless the source emits GHGs at or 
above the 75,000 ton per year threshold. Therefore, we find this aspect 
of Louisiana's SIP submissions to be approvable because it is 
consistent with the relevant provisions of 40 CFR 51.166.
    It is important to note, however, that the EPA's proposed approval 
is not based on determination by either EPA or the state that 75,000 
tons per year CO2e is an appropriate de minimis level for 
GHGs. The EPA's proposed approval of the significant emissions rate for 
GHGs in LDEQ's rule is based only on the recognition that Louisiana's 
rule applies the same applicability level for the GHG BACT requirement 
that is presently reflected in the EPA's regulations.
    In establishing the significance level, the State rulemaking does 
not establish that 75,000 is a de minimis amount of GHG. Nothing in the 
state's rulemaking record and nothing in this EPA action provide 
support to substantiate 75,000 tons per year significance level as a de 
minimis level. See UARG, 134 S. Ct. 2427, at 2449 (noting that the EPA 
had not established the 75,000 tons per year level in the Tailoring 
Rule as a de minis threshold below which BACT is not required for a 
source's GHG emissions).
    Given the deficiencies in the justification for the GHG BACT 
applicability level in the existing EPA regulations, the EPA is 
planning to move forward in a separate, national rulemaking to propose 
a GHG Significant Emission Rate (SER) that would be justified as a de 
minis threshold level for applying the BACT requirement to GHG 
emissions under PSD. In the event that the EPA ultimately promulgates a 
final GHG SER, Louisiana, like all other SIP-approved states, may be 
obligated to undertake rulemaking to demonstrate consistency with 
federal requirements or may be subject to a SIP Call to correct a 
deficiency in the SIP-approved program.

III. Proposed Action

    Section 110(k)(3) of the Act states that the EPA may partially 
approve and partially disapprove a SIP submittal if we find that only a 
portion of the submittal meets the requirements of the Act. We are 
proposing to approve the revisions to the Louisiana PSD permitting 
program submitted on December 21, 2011, that provide the State the 
authority to regulate and permit emissions of GHGs from Step 1 sources 
in the Louisiana PSD program. The EPA has made the preliminary 
determination that the revisions are approvable because the submitted 
rules are adopted and submitted in accordance with the CAA and are 
consistent with the laws and regulations for PSD permitting of GHGs. 
Therefore, under section 110 and part C of the Act, the EPA proposes to 
approve the following specific revisions to the Louisiana SIP for PSD 
permitting:
     New provisions at LAC 33:III.501(C)(14) adopted on April 
20, 2011 and submitted December 20, 2011;
     New definitions of ``carbon dioxide equivalent'' and 
``greenhouse gases'' at LAC 33:III.509(B) adopted on April 20, 2011 and 
submitted December 20, 2011; and
     Revisions to the definitions of ``major stationary 
source'' paragraphs (a) and (b) and ``significant'' at LAC 
33:III.509(B) adopted on April 20, 2011 and submitted December 20, 
2011.
    Upon promulgation of a final approval of these proposed revisions, 
the EPA would also remove the provisions at 40 CFR 52.986(c) under 
which the EPA narrowed the applicability of the Louisiana PSD program 
to regulate sources consistent with federal requirements. The 
provisions at 40 CFR 52.986(c) will no longer be necessary when we 
finalize approval of the state regulations into the Louisiana SIP.
    We are also proposing to disapprove the provisions submitted on 
December 21, 2011, that would enable the State of

[[Page 27385]]

Louisiana to regulate and permit Step 2 sources, under the Louisiana 
PSD program because the submitted provisions are no longer consistent 
with federal laws. Specifically, the EPA is proposing to disapprove 
revisions to the definitions at LAC 33:III.509 for ``major stationary 
source'' paragraph (c) ``significant'' as it pertains to Step 2 
sources, as adopted on April 20, 2011 and submitted December 20, 2011. 
Finalization of this proposed disapproval will not require the EPA to 
promulgate a Federal Implementation Plan because the Louisiana PSD 
program would continue to regulate GHG emissions consistent with 
federal statutory and regulatory permitting requirements. We are 
proposing this disapproval under section 110 and part C of the Act; as 
such, we will also not impose sanctions as a result of a final 
disapproval.
    The EPA is also taking the opportunity to correct an omission in 
our proposed approval of revisions to the Louisiana Major New Source 
Review program on August 19, 2015. In that action we neglected to 
specifically identify the revisions submitted on December 20, 2005 to 
the PSD definition of ``major stationary source'' at LAC 33:III.509(B) 
as part of our proposed action. In both the TSD associated with docket 
EPA-R06-OAR-2006-0131 and in the TSD accompanying today's action, we 
have evaluated this submission and found the revised regulations to be 
consistent with federal requirements at 40 CFR 51.166(b)(1)(iii). As 
such, we are also proposing approval of the revisions to the definition 
of ``major stationary source'' at LAC 33:III.509(B) submitted on 
December 20, 2005 as subparagraph (e), but was moved to subparagraph 
(f) in the December 20, 2011 submittal.

IV. Incorporation by Reference

    In this action, we are proposing to include in a final rule 
regulatory text that includes incorporation by reference. In accordance 
with the requirements of 1 CFR 51.5, we are proposing to incorporate by 
reference revisions to the Louisiana regulations as described in the 
Proposed Action section above. We have made, and will continue to make, 
these documents generally available electronically through 
www.regulations.gov and/or in hard copy at the EPA Region 6 office.

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 Act and applicable 
Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in 
reviewing SIP submissions, the EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. Accordingly, this 
action proposes approval of the portions of the submitted revisions to 
State law for the regulation and permitting of GHG emissions consistent 
with federal requirements and proposes disapproval of the portions of 
the state laws that do not meet Federal requirements for the regulation 
and permitting of GHG emissions.

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is not a significant regulatory action and was 
therefore not submitted to the Office of Management and Budget (OMB) 
for review.

B. Paperwork Reduction Act (PRA)

    This action does not impose an information collection burden under 
the PRA. There is no burden imposed under the PRA because this action 
proposes to disapprove submitted revisions that are no longer 
consistent with federal laws for the regulation and permitting of GHG 
emissions.

C. Regulatory Flexibility Act (RFA)

    I certify that this action will not have a significant economic 
impact on a substantial number of small entities under the RFA. This 
action will not impose any requirements on small entities. This action 
proposes to disapprove submitted revisions that are no longer 
consistent with federal laws for the regulation and permitting of GHG 
emissions, and therefore will have no impact on small entities.

D. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded mandate as described in 
UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect 
small governments. The action imposes no enforceable duty on any state, 
local or tribal governments or the private sector. This action proposes 
to disapprove submitted revisions that are no longer consistent with 
federal laws for the regulation and permitting of GHG emissions, and 
therefore will have no impact on small governments.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It will 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.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications as specified in 
Executive Order 13175. This action proposes to disapprove provisions of 
state law that are no longer consistent with federal laws for the 
regulation and permitting of GHG emissions; there are no requirements 
or responsibilities added or removed from Indian Tribal Governments. 
Thus, Executive Order 13175 does not apply to this action.

G. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    The EPA interprets Executive Order 13045 as applying only to those 
regulatory actions that concern environmental health or safety risks 
that the EPA has reason to believe may disproportionately affect 
children, per the definition of ``covered regulatory action'' in 
section 2-202 of the Executive Order. This action is not subject to 
Executive Order 13045 because it disapproves state permitting 
provisions that are inconsistent with federal laws for the regulation 
and permitting of GHG emissions.

H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution or Use

    This action is not subject to Executive Order 13211, because it is 
not a significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act (NTTAA)

    This rulemaking does not involve technical standards.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    The EPA believes the human health or environmental risk addressed 
by this action will not have potential disproportionately high and 
adverse human health or environmental effects on minority, low-income 
or indigenous populations. This action is not subject to Executive 
Order 12898 because it disapproves state permitting provisions that are 
inconsistent with federal laws for the regulation and permitting of GHG 
emissions.

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List of Subjects in 40 CFR Part 52

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

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

    Dated: April 29, 2016.
Ron Curry,
Regional Administrator, Region 6.
[FR Doc. 2016-10739 Filed 5-5-16; 8:45 am]
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