E8-20388. Approval and Promulgation of Implementation Plans; Georgia; Prevention of Significant Deterioration and Nonattainment New Source Review Rules

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Proposed rule.

SUMMARY:

EPA is proposing to partially approve and disapprove portions of revisions to the Georgia State Implementation Plan (SIP) submitted by the State of Georgia in three submittals dated October 31, 2006, March 5, 2007, and August 22, 2007. The proposed revisions modify Georgia's Prevention of Significant Deterioration (PSD) and Nonattainment New Source Review (NNSR) permitting rules in the SIP to address changes to the federal New Source Review (NSR) regulations, which were promulgated by EPA on December 31, 2002, and reconsidered with minor changes on November 7, 2003 (collectively, these two final actions are referred to as the “2002 NSR Reform Rules”). The proposed revisions include provisions for baseline emissions calculations, an actual-to-projected-actual methodology for calculating emissions changes, options for plantwide applicability limits, and recordkeeping and reporting requirements. EPA is proposing to approve Georgia's NSR rule revisions, with the exception of one NNSR provision. EPA is proposing to disapprove the State's incorporation of “baseline emissions calculations” into the Georgia NNSR provisions for the generation of Emissions Reductions' Credits to be used as offsets.

DATES:

Comments must be received on or before October 6, 2008.

ADDRESSES:

Submit your comments, identified by Docket ID No. EPA-R04-OAR-2006-0649, by one of the following methods:

1. http://www.regulations.gov: Follow the on-line instructions for submitting comments.

2. E-mail: [e-mail].

3. Fax: [phone].

4. Mail: (Docket ID No. EPA-R04-OAR-2006-0649), Air Planning Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303-8960.

5. Hand Delivery or Courier: Ms. Kelly Fortin, Air Planning Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303-8960. Such deliveries are only accepted during the Regional Office's normal hours of operation. The Regional Office's official hours of business are Monday through Friday, 8:30 to 4:30, excluding federal holidays.

Instructions: Direct your comments to Docket ID No. EPA-R04-OAR-2006-0649. EPA's policy is that all comments received will be included in the public docket without change and may be made available online at http://www.regulations.gov,, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through http://www.regulations.gov,, your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. For additional information about EPA's public docket, visit the EPA Docket Center homepage at http://www.epa.gov.epahome/​dockets.htm.

Docket: All documents in the docket are listed in the http://www.regulations.gov index. 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, will be publicly available only in hard copy. Publicly available docket materials are available either electronically at http://www.regulations.gov or in hard copy at the Regulatory Development Section, Air Planning Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303-8960. EPA requests that if at all possible, you contact the person listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office's official business hours are Monday through Friday, 8:30 to 4:30, excluding federal holidays.

FOR FURTHER INFORMATION CONTACT:

For information regarding the Georgia State Implementation Plan, contact Ms. Stacy Harder, Regulatory Development Section, Air Planning Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303-8960. Telephone number: [phone]; e-mail address: [e-mail]. For information regarding New Source Review, contact Ms. Kelly Fortin, Air Permits Section, at the same address above. Telephone number: [phone]; e-mail address: [e-mail].

SUPPLEMENTARY INFORMATION:

Throughout this document, references to “EPA,” “we,” “us,” or “our,” are intended to mean the U.S. Environmental Protection Agency. The supplementary information is arranged as follows:

I. What Action Is EPA Proposing?

II. What Is the Background of EPA's Proposed Action?

III. What Is EPA's Analysis of Georgia's NSR Rule Revisions?

A. Prevention of Significant Deterioration

B. Nonattainment New Source Review

IV. Proposed Action

V. Statutory and Executive Order Reviews

I. What Action Is EPA Proposing?

On October 31, 2006, March 5, 2007, and August 22, 2007, the State of Georgia, through the Georgia Environmental Protection Division (EPD), submitted revisions to the Georgia SIP. The SIP submittals consist of changes to the Georgia Rules for Air Quality Control, Chapter 391-3-1. Specifically, the October 31, 2006, proposed SIP revision includes changes to Rules 391-3-1-.02(7) “Prevention of Significant Deterioration of Air Quality” and 391-3-1-.03(8)(c) “Permit Requirements” related to nonattainment new source review. The March 5, 2007, submittal includes changes to Rules 391-3-1-.02(7) “Prevention of Significant Deterioration of Air Quality,” and 391-3-1-.03(13)(c) “Emission Reduction Credits.” Finally, the August 22, 2007, submittal includes changes to Rules 391-3-1-.02(7) “Prevention of Significant Deterioration of Air Quality,” and 391-3-1-.03(8) “Permit Requirements.” Georgia EPD submitted these revisions in response to EPA's December 31, 2002, changes to the federal NSR program. Consistent with section 110(k)(3) of the Clean Air Act (CAA), EPA is now proposing to partially approve NSR Reform related rules included in the above-summarized SIP revisions, with the exception of the revision to subparagraph 391-3-1-.03(13)(c), related to “Emissions Reduction Credits,” which EPA is proposing to disapprove. EPA is not acting on the non-NSR Reform portions of the submittals (Rules 391-3-1-.01(llll), 391-3-1-.02(2)(jjj), 391-3-1-.02(2)(ooo), 391-3-1-.02(6)(a)4, 391-3-1-.02(12), and 391-3-1-.03(6)(b)) in this action. Additionally, EPA is not acting on revisions to rules 391-3-1-.02(8)b, and 391-3-1-.03(9), because these rules are not part of the federally approved SIP.

II. What Is the Background of EPA's Proposed Action?

On December 31, 2002 (67 FR 80186), EPA published final rule changes to 40 Code of Federal Regulations (CFR) parts 51 and 52, regarding the CAA's PSD and NNSR programs. On November 7, 2003 (68 FR 63021), EPA published a notice of final action on the reconsideration of the December 31, 2002, final rule changes. The December 31, 2002, and the November 7, 2003, final actions are collectively referred to as the “2002 NSR Reform Rules.” The purpose of this action is to propose to approve the SIP submittals from the State of Georgia that include State rule changes made as a result of EPA's 2002 NSR Reform Rules.

The 2002 NSR Reform Rules are part of EPA's implementation of parts C and D of title I of the CAA, 42 U.S.C. 7470-7515. Part C of title I of the CAA, 42 U.S.C. 7470-7492, is the PSD program, which applies in areas that meet the National Ambient Air Quality Standards (NAAQS)—“attainment” areas—as well as in areas for which there is insufficient information to determine whether the area meets the NAAQS—“unclassifiable” areas. Part D of title I of the CAA, 42 U.S.C. 7501-7515, is the NNSR program, which applies in areas that are not in attainment of the NAAQS—“nonattainment” areas. Collectively, the PSD and NNSR programs are referred to as the “New Source Review” or NSR programs. EPA regulations implementing these programs are contained in 40 CFR 51.165, 51.166, 52.21, 52.24, and part 51, appendix S.

The CAA's NSR programs are preconstruction review and permitting programs applicable to new and modified stationary sources of air pollutants regulated under the CAA. The NSR programs of the CAA include a combination of air quality planning and air pollution control technology program requirements. Briefly, section 109 of the CAA, 42 U.S.C. 7409, requires EPA to promulgate primary NAAQS to protect public health and secondary NAAQS to protect public welfare. Once EPA sets those standards, states must develop, adopt, and submit to EPA for approval a SIP that contains emissions limitations and other control measures to attain and maintain the NAAQS. Each SIP is required to contain a preconstruction review program for the construction and modification of any stationary source of air pollution to assure that the NAAQS are achieved and maintained; to protect areas of clean air; to protect air quality related values (such as visibility) in national parks and other areas; to assure that appropriate emissions controls are applied; to maximize opportunities for economic development consistent with the preservation of clean air resources; and to ensure that any decision to increase air pollution is made only after full public consideration of the consequences of the decision.

The 2002 NSR Reform Rules made changes to five areas of the NSR programs. In summary, the 2002 Rules: (1) Provide a new method for determining baseline actual emissions; (2) adopt an actual-to-projected-actual methodology for determining whether a major modification has occurred; (3) allow major stationary sources to comply with PALs to avoid having a significant emissions increase that triggers the requirements of the major NSR program; (4) provided a new applicability provision for emissions units that are designated clean units; and (5) excluded pollution control projects (PCPs) from the definition of “physical change or change in the method of operation.” On November 7, 2003 (68 FR 63021), EPA published a notice of final action on its reconsideration of the 2002 NSR Reform Rules, which added a definition for “replacement unit” and clarified an issue regarding PALs. For additional information on the 2002 NSR Reform Rules, see, 67 FR 80186 (December 31, 2002), and http://www.epa.gov/​nsr.

After the 2002 NSR Reform Rules were finalized and effective (March 3, 2003), industry, state, and environmental petitioners challenged numerous aspects of the 2002 NSR Reform Rules, along with portions of EPA's 1980 NSR Rules (45 FR 52676, August 7, 1980). On June 24, 2005, the United States Court of Appeals for the District of Columbia (D.C. Circuit Court) issued a decision on the challenges to the 2002 NSR Reform Rules. New York v. United States, 413 F.3d 3 (D.C. Cir. 2005). In summary, the D.C. Circuit Court vacated portions of the rules pertaining to clean units and PCPs, remanded a portion of the rules regarding recordkeeping and the term “reasonable possibility” found in 40 CFR 52.21(r)(6) and 40 CFR 51.166(r)(6), and either upheld or did not comment on the other provisions included as part of the 2002 NSR Reform Rules. On June 13, 2007 (72 FR 32526), EPA took final action to revise the 2002 NSR Reform Rules to remove from federal law all provisions pertaining to clean units and the PCP exemption that were vacated by the D.C. Circuit Court.

With regard to the remanded portions of the 2002 NSR Reform Rules related to recordkeeping, on December 21, 2007, EPA took final action to establish that a “reasonable possibility” applies where source emissions equal or exceed 50 percent of the CAA NSR significance levels for any pollutant (72 FR 72607). The “reasonable possibility” provision identifies for sources and reviewing authorities the circumstances under which a major stationary source undergoing a modification that does not trigger major NSR must keep records.

The 2002 NSR Reform Rules require that state agencies adopt and submit revisions to their SIP permitting programs implementing the minimum program elements of the 2002 NSR Reform Rules no later than January 2, 2006. (Consistent with changes to 40 CFR 51.166(a)(6)(i), state agencies are now required to adopt and submit SIP revisions within three years after new amendments are published in the Federal Register.) State agencies may meet the requirements of 40 CFR part 51 and the 2002 NSR Reform Rules with different but equivalent regulations.

On October 31, 2006, March 5, 2007, and August 22, 2007, Georgia EPD submitted revisions to EPA for the purpose of including the revised State NSR permitting rules in the SIP. EPA is now proposing to partially approve and disapprove certain portions of these submittals consistent with section 110(k)(3) of the CAA.

III. What Is EPA's Analysis of Georgia's NSR Rule Revisions?

Georgia currently has a SIP-approved NSR program for new and modified stationary sources. EPA is now proposing to approve revisions to Georgia's existing NSR program (with the exception of one NNSR provision). Georgia's SIP submittals consist of a compilation of amendments that became State-effective between April 19, 2006, and July 25, 2007. Copies of Georgia's revised NSR rules, as well as the State's Technical Support Document, can be obtained from the Docket, as discussed in the ADDRESSES section above. Below is a discussion of the specific changes to Georgia's rules now proposed for inclusion into the SIP.

A. Prevention of Significant Deterioration

Georgia Rule for Air Quality Control chapter 391-3-1-.02, paragraph 7, “Prevention of Significant Deterioration of Air Quality,” contains the preconstruction review program that provides for the prevention of significant deterioration of ambient air quality as required under Part C of title I of the CAA (the PSD program). The PSD program applies to sources that are major stationary sources or undergoing major modifications in areas that are designated as attainment or unclassifiable with regard to any NAAQS. Georgia's PSD program was originally approved into the SIP by EPA on February 10, 1982 (47 FR 6017), and has been revised several times since then in order to remain consistent with federal rule changes.

The changes to Georgia's PSD rules, which EPA is now proposing to approve into the Georgia SIP, were made to update the existing Georgia rules to meet the requirements of the 2002 NSR Reform Rules. The SIP revisions including these rule updates address baseline actual emissions, actual-to-projected-actual applicability tests, and PALs. Georgia's PSD rules incorporate by reference (IBR) the federal PSD rules at 40 CFR 52.21, as amended by January 29, 2006. The version of 40 CFR 52.21 that is incorporated by reference into the Georgia rules is the version that existed as of the date of publication of the State's public notice, which was January 29, 2006. The proposed revisions explicitly exclude the PCP and clean unit portions of the 2002 NSR Reform Rules that were vacated as part of the D.C. Circuit Court's June 2005 decision.

With regard to the remanded portions of the 2002 NSR Reform Rules related to recordkeeping and EPA's December 21, 2007, clarifications of the term “reasonable possibility” (72 FR 72607), Georgia did not incorporate by reference or adopt the federal “reasonable possibility” provisions at 40 CFR 52.21(r)(6). In lieu of the federal provisions, Georgia adopted detailed recordkeeping and reporting requirements that apply to all modifications that use the actual-to-projected-actual methodology and are required to obtain a permit under Georgia's general permitting requirements (i.e. minor source construction program). Thus, the Georgia recordkeeping and reporting provisions are more comprehensive than the federal requirements. EPA's December 21, 2007, final action on the recordkeeping and reporting provisions of the federal rules explains state obligations with regard to the reasonable possibility related rule changes. See, 72 FR 72613-72614. Georgia has 3 years from the December 2007 rulemaking to submit revisions to incorporate the reasonable possibility provisions or to submit notice to EPA that their regulations fulfill these requirements.

In addition to incorporating the federal rule by reference, Georgia's rules include several additional provisions, such as the correction of reference errors in the federal rule, clarification of procedures for implementing the rules, and additional recordkeeping and reporting requirements. Each of these provisions is specifically addressed in Georgia's Technical Support Document. As part of the evaluation of the Georgia SIP submittals, EPA performed a line-by-line comparison of Georgia's proposed revisions and the federal requirements. As a general matter, state agencies may meet the requirements of 40 CFR part 51 and the 2002 NSR Reform Rules, with different but equivalent regulations. In addition, as part of its SIP submittal, Georgia EPD provided EPA with an “equivalency demonstration” comparing the differences in the State rule with the corresponding sections of the federal rules.

One notable difference from the federal rules is that the Georgia rules contain an optional provision for the permittee to omit “malfunction” emissions from the calculation of “baseline actual emissions” and “projected actual emissions” (Georgia Rules 391-3-1-.02(7)(a)2.(ii)(II)II). In the equivalency demonstration, EPD notes the difficulty of quantifying past malfunction emissions and estimating future malfunction emissions as part of the projected actual emissions. Georgia's rule specifies that if malfunction emissions are omitted from projected actual emissions, they must also be omitted from baseline actual emissions and vice-versa, so as to provide a comparable estimation of the emissions increases associated with a project. The intent behind this optional calculation methodology is that it may result in a more accurate estimate of emission increases. The federal rules allow for some flexibility, and EPA supports EPD's analysis that the Georgia rule is at least as stringent as the federal rule.

After evaluating the submittals and supporting documentation for changes to Georgia's PSD rules, EPA has determined that the proposed SIP revisions are consistent with the federal program requirements for the preparation, adoption and submittal of implementation plans for the Prevention of Significant Deterioration of Air Quality, set forth at 40 CFR 51.166.

B. Nonattainment New Source Review

Georgia's NNSR program applies to the construction and modification of any major stationary source of air pollution in a nonattainment area, as required by Part D of title I of the CAA. The provisions in the Georgia NNSR Rules 391-3-1-.03(8) were established to meet the current federal nonattainment rule, including the 2002 NSR Reform Rules, which are found at 40 CFR 51.160-165 and part 51, Appendix S.

The Georgia NNSR Rules incorporate applicable provisions from the state's PSD rules (391-3-1-.02(7)) and include additional provisions unique to nonattainment areas. Many of the changes that Georgia made to its PSD program to incorporate the federal NSR Reform Rules are also applicable to sources subject to NNSR permitting requirements. These include the above-mentioned requirements for baseline emissions calculations, an actual-to-projected-actual methodology for calculating emissions changes, options for plantwide applicability limits, and recordkeeping and reporting requirements. Likewise, the differences from the federal rule that were discussed in reference to the PSD program are also applicable to the Georgia nonattainment program.

As was discussed above, Georgia provided EPA with an equivalency demonstration to show that the State program is at least as stringent as the federal program. For Georgia's NNSR program, the differences from the federal rules for which the State demonstrated equivalency are the same as those identified in the State's PSD program. These deviations from the federal rule are acceptable, and may be retained in Georgia's NNSR program now being proposed for approval into the SIP.

The October 31, 2006, submittal also contains additional requirements related to offsets. These new provisions (subparagraphs 391-3-1-.03(8)(c) 12 (iv) through (vi)) require permittees that are required to obtain offsets for new and modified stationary sources to provide documentation to EPD that they have obtained sufficient offsets prior to start-up of the new or modified stationary source. EPA has determined that these proposed SIP revisions are consistent with the Federal program requirements for the preparation, adoption and submittal of implementation plans for the Review of New Sources and Modifications set forth at 40 CFR 51.160-165, and part 51, Appendix S.

The August 22, 2007, submittal also contains clarifications to specify, in Rule 391-3-1-.03(8)(e), the additional seven counties included in the Atlanta 8-hour ozone nonattainment area (as revised from the thirteen county 1-hour ozone nonattainment area). These counties are subject to nonattainment area permitting requirements, including the revised NSR reform provisions.

The March 5, 2007, submittal includes a revision to Georgia Rule 391-3-1-.03 subparagraph (13)(c), “Quantification of Emission Reduction Credits.” The proposed SIP revision changes the methodology for the calculation of emission reduction credits to incorporate the new Federal definition of “baseline actual emissions.” The State's purpose was to make the method for determining actual emissions, prior to a reduction, consistent with the calculation of baseline emissions reductions used elsewhere in the Federal and State NSR requirements. The emission reduction credits are certified under the Georgia rule to be used as offsets for NSR purposes. However, the federal requirements at 40 CFR 51.165 (a)(3)(i) indicate that the offset baseline shall be the “actual emissions” of the source from which offset credit is obtained. For additional discussion on this topic, see EPA's final action on the NSR Reform Rules (67 FR 80196), under the heading “Am I able to Apply Today's Changes for Calculating the Baseline Actual Emissions to Other Major NSR Requirements?” The Georgia SIP currently contains an approved calculation methodology for emission reduction credits, which is based upon the federal definition of “actual emissions” rather than “baseline actual emissions.” EPA is now proposing to disapprove the State's March 5, 2007, change to Georgia Rule 391-3-1-.03 subparagraph (13)(c) because it is not consistent with EPA's NSR Reform Rules. This provision is severable from the other portions of the Georgia submittals subject to this action. No further changes are necessary in response to EPA's proposed disapproval because Georgia's rules already contain a SIP-approved methodology for calculating emission reduction credits that is consistent with EPA's NSR Reform Rules.

IV. What Action Is EPA Proposing To Take?

EPA is proposing to partially approve and disapprove revisions to the Georgia SIP submitted on October 31, 2006, March 5, 2007, and August 22, 2007, that address changes to Georgia's PSD and NNSR programs. The disapproval involves subparagraph 391-3-1-.03(13)(c) of the March 5, 2007, submittal related to “Emissions Reduction Credits.” EPA's proposal to partially approve and disapprove the NSR permitting portions of the SIP submittals is consistent with section 110(k)(3) of the CAA.

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, EPA's role is to approve State choices, provided that they meet the criteria of the CAA. Accordingly, this proposed 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 proposed action:

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);
• 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, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

• Environmental protection
• Air pollution control
• Carbon monoxide
• Intergovernmental relations
• Lead
• Nitrogen dioxide
• Ozone
• Particulate matter
• Reporting and recordkeeping requirements
• Sulfur oxides
• Volatile organic compounds

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

Dated: August 25, 2008.

Russell L. Wright Jr.,

Acting Regional Administrator, Region 4.