[Federal Register Volume 83, Number 153 (Wednesday, August 8, 2018)]
[Proposed Rules]
[Pages 39012-39014]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-16877]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2018-0413; FRL-9981-73--Region 9]


Revisions to California State Implementation Plan; South Coast 
Air Quality Management District; Stationary Source Permits

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing action 
on a revision to the South Coast Air Quality Management District 
(SCAQMD or District) portion of the California State Implementation 
Plan (SIP). We are proposing a conditional approval of an update to 
provisions governing issuance of permits for stationary sources, 
including review and permitting of major sources and major 
modifications under part D of title I of the Clean Air Act (CAA). 
Specifically, the revision pertains to SCAQMD Rule 1325--Federal PM2.5 
New Source Review Program. We are taking comments on this proposal and 
a final action will follow.

DATES: Any comments must arrive by September 7, 2018.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R09-
OAR-2018-0413 at http://www.regulations.gov, or via email to 
[email protected]. For comments submitted at Regulations.gov, follow 
the online instructions for submitting comments. Once submitted, 
comments cannot be removed or edited from Regulations.gov. For either 
manner of submission, 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 the person 
identified in the FOR FURTHER INFORMATION CONTACT section. 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.

FOR FURTHER INFORMATION CONTACT: Laura Yannayon, EPA Region 9, (415) 
972-3534, [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document, the terms ``we,'' 
``us,'' and ``our'' refer to EPA.

Table of Contents

I. The State's Submittal
    A. What rule did the State submit?
    B. Are there other versions of this rule?
    C. What is the purpose of the submitted rule?
II. The EPA's Evaluation
    A. How is the EPA evaluating the rule?
    B. Does the rule meet the evaluation criteria?
III. Proposed Action and Public Comment
IV. Incorporation by Reference
V. Statutory and Executive Order Reviews

I. The State's Submittal

A. What rule did the State submit?

    Table 1 lists the rule addressed by this proposal with the date it 
was adopted by SCAQMD and submitted by the California Air Resources 
Board (CARB), the governor's designee for California SIP submittals. 
Rule 1325 contains the District's New Source Review (NSR) permit 
program applicable to new and modified major sources emitting fine 
particulate matter (PM2.5) and PM2.5 precursors.

                         Table 1--Submitted Rule
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     Rule No.            Rule title           Amended        Submitted
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1325..............  Federal PM2.5 New            11/4/16          5/8/17
                     Source Review
                     Program.
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    On November 1, 2017, CARB's May 8, 2017 submittal of Rule 1325 was 
deemed to meet the completeness criteria in 40 CFR part 51, appendix V. 
Completeness criteria must be met before formal EPA review.

B. Are there other versions of this rule?

    The current SIP contains a version of Rule 1325--Federal PM2.5 New 
Source Review Program, approved into the SIP on May 1, 2015 (80 FR 
24821). Consistent with the District's stated intent to have the 
submitted rule replace the existing SIP-approved rule in its entirety, 
EPA's conditional approval of the rule identified above in Table 1 
would have the effect of entirely superseding our prior approval of the 
same rule in the current SIP-approved program.

C. What is the purpose of the submitted rule?

    For areas designated as nonattainment for one or more National 
Ambient Air Quality Standards (NAAQS), the SIP must include 
preconstruction permit requirements for new or modified major 
stationary sources of such nonattainment pollutant(s), commonly 
referred to as ``Nonattainment New Source Review'' (NNSR). CAA 
172(c)(5).
    SCAQMD Rule 1325 addresses NNSR permit requirements for major 
sources of PM2.5. Rule 1325 has been amended to address 
SCAQMD's reclassification from a Moderate to a Serious PM2.5 
nonattainment area and to implement additional provisions pertaining to 
precursors, as promulgated in EPA's rule entitled Fine Particulate 
Matter National Ambient Air Quality Standards: State Implementation 
Plan Requirements (``2016 Implementation Rule'').\1\
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    \1\ 81 FR 58010, August 24, 2016.
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II. The EPA's Evaluation and Action

A. How is the EPA evaluating the rule?

    Under EPA's 2016 Implementation Rule, which implements the D.C. 
Circuit court's January 2013 decision in NRDC v. EPA,\2\ areas 
classified as nonattainment for any PM2.5 NAAQS are required 
to comply with the parts of CAA subpart 4 section 189(e) \3\ that 
require the control of major stationary sources of PM10 
precursors (and hence under the court decision, PM2.5 
precursors) ``except where the Administrator determines that such 
sources do not contribute significantly

[[Page 39013]]

to PM10 levels which exceed the standard in the area.'' The 
2016 Implementation Rule amended the definitions of (1) Regulated NSR 
Pollutant with regards to PM2.5 precursors; (2) Major 
Stationary Source with regards to major sources locating in 
PM2.5 nonattainment areas classified as Moderate and 
Serious; and (3) Significant with regards to emissions of 
PM2.5 precursors. Rule 1325 is subject to these new 
regulatory requirements.
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    \2\ 706 F.3d 428 (D.C. Cir. 2013).
    \3\ This requirement was codified in 40 CFR 51.165(a)(13). See 
81 FR 58010, August 24, 2016.
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    The SCAQMD is classified as a Moderate nonattainment area for the 
2012 PM2.5 NAAQS. On January 13, 2016,\4\ the SCAQMD was 
reclassified from a Moderate to a Serious PM2.5 
nonattainment area for the 2006 PM2.5 NAAQS. The major 
source permitting threshold for a Moderate PM2.5 
nonattainment area is 100 tons per year (tpy) of direct 
PM2.5 or any PM2.5 precursor, and 70 tpy for a 
Serious PM2.5 nonattainment area.
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    \4\ 81 FR 1514, January 13, 2016.
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    In addition, EPA has reviewed the submitted rule for compliance 
with: (1) The requirements for SIPs as set forth in CAA section 
110(a)(2); (2) the requirements related to SIP revisions in CAA 
sections 110(l) and 193; (3) the requirements for stationary source 
preconstruction permitting programs in CAA section 173(a) through (c); 
and (4) the requirements related to the review and modification of 
major sources in 40 CFR part 51.165 that pertain to a PM2.5 
nonattainment area classified as Serious.

B. Does the rule meet the evaluation criteria?

    In our previous May 1, 2015 \5\ action we evaluated Rule 1325 in 
accordance with the CAA and regulatory requirements listed in Section 
II.A of this preamble. In that action, we determined Rule 1325 
satisfied the applicable requirements for a PM2.5 NNSR 
permit program. Below we discuss and evaluate the revised portions of 
submitted Rule 1325 to determine if the revisions meet current 
applicable requirements for a PM2.5 NNSR permit program.
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    \5\ 80 FR 24821.
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    Section (a)--Applicability, contains minor revisions to clarify 
that the rule applies to major polluting facilities that will emit 
PM2.5 or its precursors in areas federally-designated as 
nonattainment for PM2.5. EPA finds these clarifying 
revisions approvable.
    Section (b)--Definitions, has been revised to update: (1) The 
effective date of the referenced 40 CFR 51.165(a)(1) definitions; (2) 
the definition of Major Polluting Facility to include a 70 tpy 
emissions threshold, effective upon the date of the EPA's approval of 
the November 4, 2016 amendments to Rule 1325; (3) the definition of 
Precursors to include volatile organic compounds (VOC) and ammonia, 
effective upon the date of the EPA's approval of the November 4, 2016 
amendments to Rule 1325; and (4) the definition of ``Significant'' to 
include VOC and ammonia and specify a 40 tpy threshold. EPA finds these 
revisions approvable, as they are consistent with current applicable 
requirements for a serious PM2.5 nonattainment area.
    The definition of Regulated NSR Pollutant was not revised to 
include VOC and ammonia as PM2.5 precursors. Because the 
definition for the term Major Modification relies on the definition of 
Regulated NSR Pollutant, Rule 1325 does not satisfy the requirement to 
include VOC and ammonia as PM2.5 precursors when evaluating 
if a project will result in a major modification, and it is therefore 
deficient.
    Section (f)--Two Year Limit on Facility Exemption has been revised 
to lower the emissions threshold for this exemption provision from 100 
tpy to 70 tpy, effective upon the date of the EPA's approval of the 
November 4, 2016 amendments to Rule 1325. The provision requires a 
source to aggregate its PM2.5 emissions from any permit 
actions that occur within a two-year period to determine if emissions 
exceed 70 tpy; if so, offsets are required for the aggregated emission 
increase. This provision requiring PM2.5 emissions to be 
aggregated is more stringent that CAA requirements. Therefore, EPA 
finds this more stringent provision acceptable.
    Section (j)--Offset Exemptions for Regulatory Compliance has been 
added.
    This provision allows the Executive Officer to exempt new or 
modified sources installed solely to comply with District, state or 
federal air pollution control regulations from the otherwise applicable 
offset requirements. EPA finds this new provision approvable.
    In addition, other minor editorial or conforming edits have been 
made throughout the rule. EPA finds these revisions approvable.
    With respect to procedural requirements, CAA sections 110(a)(2) and 
110(l) require that revisions to a SIP be adopted by the state after 
reasonable notice and public hearing. EPA has promulgated specific 
procedural requirements for SIP revisions in 40 CFR part 51, subpart V. 
These requirements include publication of notices by prominent 
advertisement in the relevant geographic area, a public hearing or 
notice of an opportunity for a public hearing on the proposed 
revisions, and a public comment period of at least 30 days.
    Based on our review of the public process documentation included in 
the May 5, 2017 submittal, we find that SCAQMD has provided sufficient 
evidence of public notice and opportunity for comment and a public 
hearing prior to adoption and submittal of these rules to EPA.
    Section 193 of the Act, which was added by the Clean Air Act 
Amendments of 1990, includes a clause providing in pertinent part: ``No 
control 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 after November 15, 1990, in any manner unless the modification 
insures equivalent or greater emission reductions of such air 
pollutant.'' Since PM2.5 is a NAAQS adopted after 1990, 
there are no existing PM2.5 control requirements that would 
be subject to the provisions of Section 193 of the CAA. Therefore, for 
the purposes of our analysis of Rule 1325, we find that Section 193 of 
the CAA does not apply to this action.

III. Proposed Action and Public Comment

    Because the revisions to Rule 1325 do not ensure VOC and ammonia 
emissions are evaluated to determine if a proposed project will result 
in a major modification, EPA cannot grant full approval of this rule 
under section 110(k)(3) of the Act. However, in a letter dated June 26, 
2018, the District committed to adopt and submit specific enforceable 
measures to address this deficiency. The District committed to submit 
these revisions to CARB within 11 months of the date of EPA's final 
action. In addition, in a letter dated July 16, 2018, CARB committed to 
submit the adopted rule revisions to EPA no later than 12 months from 
the date of EPA's final action. Accordingly, pursuant to section 
110(k)(4) of the Act, EPA is proposing a conditional approval of the 
submitted rule. We are proposing to conditionally approve the submitted 
rule based on our determination that separate from the deficiency 
listed above, the rule satisfies the applicable requirements discussed 
in Section II.A of this action.
    In support of this proposed action, we have concluded that our 
conditional approval of the submitted rule would comply with section 
110(l) of the Act because the amended rule, as a whole,

[[Page 39014]]

would not interfere with continued attainment of the NAAQS in the South 
Coast Air Basin. The intended effect of our proposed conditional 
approval action is to update the applicable SIP with current SCAQMD 
rules and provide SCAQMD the opportunity to correct the identified 
deficiencies, as discussed in their commitment letter dated June 26, 
2018. If we finalize this action as proposed, our action would 
incorporate this rule into the federally enforceable SIP and be 
codified through revisions to 40 CFR 52.220 (Identification of plan) 
and 40 CFR 52.119 (Part D conditional approval).
    If the State meets its commitment to submit the required measures 
within 12 months of the date of EPA's final action, Rule 1325 will 
remain a part of the SIP until EPA takes final action approving or 
disapproving any subsequently submitted SIP revision. However, if the 
District fails to submit a revision within the required timeframe, the 
conditional approval will automatically become a disapproval, and EPA 
will issue a finding of disapproval. EPA is not required to propose the 
finding of disapproval.
    We will accept comments from the public on this proposal until 
September 7, 2018. If we take final action to approve the submitted 
rule, our final action will incorporate this rule into the federally 
enforceable SIP.

IV. Incorporation by Reference

    In this rule, the 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, the EPA is proposing to incorporate by 
reference the SCAQMD rule listed in Table 1 of this preamble. The EPA 
has made, and will continue to make, these materials available 
electronically through www.regulations.gov and in hard copy at the EPA 
Region IX Office (please contact the person identified in the FOR 
FURTHER INFORMATION CONTACT section of this preamble for more 
information).

V. Statutory and Executive Order Reviews

    Under the Clean Air Act, 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 Clean Air Act. 
Accordingly, this proposed 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 (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 Clean Air Act; and
     does not provide the EPA with the discretionary authority 
to address disproportionate human health or environmental effects with 
practical, appropriate, 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 the 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).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
reference, Intergovernmental relations, Particulate matter, Reporting 
and recordkeeping requirements.

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

    Dated: July 24, 2018.
Michael Stoker,
Regional Administrator, Region IX.
[FR Doc. 2018-16877 Filed 8-7-18; 8:45 am]
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