82_FR_43379 82 FR 43202 - Revisions to California State Implementation Plan; Bay Area Air Quality Management District; Emission Reduction Credit Banking

82 FR 43202 - Revisions to California State Implementation Plan; Bay Area Air Quality Management District; Emission Reduction Credit Banking

ENVIRONMENTAL PROTECTION AGENCY

Federal Register Volume 82, Issue 177 (September 14, 2017)

Page Range43202-43205
FR Document2017-19451

The Environmental Protection Agency (EPA) is proposing action on a revision to the Bay Area Air Quality Management District (BAAQMD or District) portion of the California State Implementation Plan (SIP). We are proposing a conditional approval of one rule. This revision consists of updates to provisions governing the issuance and banking of Emission Reduction Credits for use in the review and permitting of major sources and major modifications under part D of title I of the Clean Air Act (CAA). We are taking comments on this proposal and plan to follow with a final action.

Federal Register, Volume 82 Issue 177 (Thursday, September 14, 2017)
[Federal Register Volume 82, Number 177 (Thursday, September 14, 2017)]
[Proposed Rules]
[Pages 43202-43205]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-19451]


=======================================================================
-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2017-0130; FRL-9967-68-Region 9]


Revisions to California State Implementation Plan; Bay Area Air 
Quality Management District; Emission Reduction Credit Banking

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Environmental Protection Agency (EPA) is proposing action 
on a revision to the Bay Area Air Quality Management District (BAAQMD 
or District) portion of the California State Implementation Plan (SIP). 
We are proposing a conditional approval of one rule. This revision 
consists of updates to provisions governing the issuance and banking of 
Emission Reduction Credits for use in the review and permitting of 
major sources and major modifications under part D of title I of the 
Clean Air Act (CAA). We are taking comments on this proposal and plan 
to follow with a final action.

DATES: Any comments must arrive by October 16, 2017.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R09-
OAR-2017-0130 at https://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 https://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. What is the existing BAAQMD rule governing banking of 
Emission Reduction Credits in the California SIP?
    C. What is the purpose of this proposed rule?
II. EPA's Evaluation
    A. How is 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?

    On April 22, 2013, the California Air Resources Board (CARB) 
submitted an amended rule, BAAQMD Regulation 2, Rule 4 (Rule 2-4), for 
approval as a revision to the BAAQMD portion of the California SIP 
under the CAA. Regulation 2 contains the District's air quality 
permitting programs. Rule 2-4 contains requirements applicable to the 
banking of Emission Reduction Credits (ERCs) for use in the District's 
air quality permitting programs.
    Table 1 lists the rule addressed by this proposal with the dates 
that it was adopted by BAAQMD and submitted to the EPA by CARB, which 
is the governor's designee for California SIP submittals.

[[Page 43203]]



                                             Table 1--Submitted Rule
----------------------------------------------------------------------------------------------------------------
                                                                                     Adopted/
          Regulation & rule number                        Rule title                  amended        Submitted
----------------------------------------------------------------------------------------------------------------
Regulation 2, Rule 4 (Rule 2-4)............  Permits, Emissions Banking.........        12/19/12         4/22/13
----------------------------------------------------------------------------------------------------------------

    On June 26, 2013, Regulation 2, Rule 4 was deemed to meet the 
completeness criteria in 40 CFR part 51, appendix V, which must be met 
before formal EPA review. The submittal includes evidence of public 
notice and adoption of the amended rule. While we can only take action 
on the most recently submitted version of each regulation (which 
supersedes earlier submitted versions), we have reviewed materials 
provided with previous submittals.

B. What is the existing BAAQMD rule governing banking of Emission 
Reduction Credits in the California SIP?

    The existing SIP-approved banking rule in the Bay Area consists of 
the rule identified in Table 2. This rule includes requirements for the 
generation and use of ERCs in nonattainment areas.
    Consistent with the District's stated intent to have the submitted 
banking rule replace the existing SIP-approved banking rule in its 
entirety, EPA's conditional approval of the regulation identified in 
Table 1 would have the effect of entirely superseding our prior 
approval of the same rule in the current SIP-approved program.

                                           Table 2--Existing SIP Rule
----------------------------------------------------------------------------------------------------------------
                                                               BAAQMD       EPA approval
      Regulation & rule No.              Rule title         adoption date       date            FR citation
----------------------------------------------------------------------------------------------------------------
2-4.............................  Permits, Emissions            6/15/1994       1/26/1999  64 FR 3850.
                                   Banking.
----------------------------------------------------------------------------------------------------------------

C. What is the purpose of this proposed rule?

    The purpose of this proposed rule is to present our evaluation 
under the CAA and EPA's regulations of the amended banking rule 
submitted by CARB on April 22, 2013, as identified in Table 1. We 
provide our reasoning in general terms later in this preamble and 
provide a more detailed analysis in our Technical Support Document 
(TSD), which is available in the docket for this proposed rulemaking.

II. EPA's Evaluation

A. How is EPA evaluating the rule?

    In general, banking rules allow a permitting authority to evaluate 
whether certain emission reductions meet the offset integrity criteria 
found in 40 CFR 51.165(a)(3)(ii)(C)(1)(i) and CAA section 173(c)(1) at 
the time of ERC issuance, and, if found to meet these criteria, to 
certify that finding by issuing an ERC Certificate. This process 
provides the Certificate-holder with a greater degree of certainty as 
to the validity of their ERCs for future use as offsets. Since the 
intent of a banking program is to pre-review an emission reduction to 
determine whether it will meet the offset integrity criteria, we 
considered these criteria in our evaluation. In addition, we used EPA's 
Emissions Trading Policy Statement (ETPS),\1\ which provides guidance 
on emissions trading, including the banking of ERCs for future use. EPA 
also evaluated the rules for compliance with the CAA requirements for 
SIP revisions in CAA sections 110(a)(2) and 110(l), and the additional 
requirements laid out in 40 CFR 51.165(a)(3).
---------------------------------------------------------------------------

    \1\ 51 FR 43814, December 4, 1986.
---------------------------------------------------------------------------

    Our TSD, which can be found in the docket for this rule, contains a 
more detailed evaluation and discussion of the approval criteria.

B. Does the rule meet the evaluation criteria?

    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. Based on our review of the public 
process documentation included in the April 22, 2013 submittal, we find 
that the BAAQMD has provided sufficient evidence of public notice, and 
an opportunity for comment and a public hearing prior to adoption and 
submittal of these rules to EPA.
    With respect to substantive requirements, we have evaluated Rule 2-
4 to ensure it does not conflict with the requirements applicable to 
offsets in accordance with the CAA and regulatory requirements that 
apply to nonattainment NSR permit programs under part D of title I of 
the Act. For the most part, the submitted banking rule satisfies the 
applicable requirements and will strengthen the SIP by updating the 
rule and adding requirements to address fine particulate matter 
(PM2.5). However, the submitted banking rule also contains 
three deficiencies that prevent full approval. Further in this 
preamble, we discuss generally our evaluation of BAAQMD's submitted 
rule and describe the identified deficiencies. Our TSD contains a more 
detailed evaluation and recommendations for program improvements.
    First, Rule 2-4 is deficient because, while it defines the term 
ERCs as emission reductions ``that are in excess of the reductions 
required by applicable regulatory requirements, and that are real, 
permanent, quantifiable, and enforceable,'' it does not contain any 
enforceable provisions requiring the Air Pollution Control Officer to 
determine that the emission reductions under review meet the offset 
integrity criteria prior to issuing an ERC Certificate.
    Second, Rule 2-4 is deficient because it incorporates the emission 
reduction calculation procedures found in Rule 2-2 subsection 605.2. On 
August 1, 2016, EPA finalized a limited approval and limited 
disapproval of BAAQMD's Rule 2-2--New Source Review \2\ because it 
contained deficiencies regarding the calculation of emission 
reductions. Specifically, EPA disapproved Rule 2-2 subsection 605.2 
because it allows existing ``fully-offset'' sources to generate ERCs 
based on the difference between the post-modification potential to emit 
(PTE) and the pre-modification PTE. This may result in crediting 
emission reductions that are not ``actual'' reductions, as required by 
the Act. See 42 U.S.C. 7503(c)(1).
---------------------------------------------------------------------------

    \2\ 81 FR 50339, August 1, 2016.
---------------------------------------------------------------------------

    Third, Rule 2-4 is deficient because Section 2-4-302.3 allows ERC 
Certificates to be issued that do not

[[Page 43204]]

adequately ensure the permanency of an emission reduction due to a 
facility closure.
    With respect to the substantive requirements of CAA section 110(l), 
we have determined that our approval of Rule 2-4, as described in more 
detail in our TSD, represents a strengthening of the rule as compared 
to the District's current SIP-approved banking rule that we approved on 
January 26, 1999 (64 FR 3850), and that our conditional approval of the 
current SIP submittal would not interfere with any applicable 
requirement concerning attainment and Reasonable Further Progress or 
any other applicable requirement of the Act.

III. Proposed Action and Public Comment

    Because the rule deficiencies described previously are 
inappropriate for inclusion in the SIP, EPA cannot grant full approval 
of this rule under section 110(k)(3) of the Act. However, in a letter 
dated August 28, 2017, the District committed to adopt and submit 
specific enforceable measures to address these deficiencies. The 
District committed to submit these revisions to CARB by October 1, 
2018. In addition, in a letter dated August 29, 2017, CARB committed to 
submit the adopted rule revisions to EPA no later than November 1, 
2018. 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 deficiencies listed previously, 
the rule: Ensures that issued ERCs will meet the criteria laid out in 
40 CFR 51.165(a)(3)(ii)(C)(1)(i) at the time of ERC issuance; satisfies 
the requirements of 40 CFR 51.165(a)(3)(i); satisfies the applicable 
requirements found in the ETPS; and satisfies the requirements of 40 
CFR 51.165(a)(3)(ii)(C)(1)(ii), which requires pre-base year shutdown 
credits to be explicitly added back in to the most recent applicable 
air quality plans. Moreover, we conclude that if the District submits 
the changes it has committed to submit, these deficiencies will be 
cured.
    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, would not 
interfere with continued attainment of the National Ambient Air Quality 
Standards in the Bay Area. The intended effect of our proposed 
conditional approval action is to update the applicable SIP with 
current BAAQMD rules and provide BAAQMD the opportunity to correct the 
identified deficiencies, as discussed in their commitment letter dated 
August 28, 2017. If we finalize this action as proposed, our action 
would be codified through revisions to 40 CFR 52.220 (Identification of 
plan) and 40 CFR 52.232 (Part D conditional approval).
    If the State meets its commitment to submit the required measures 
by November 1, 2018, the revisions to Rule 2-4 will remain a part of 
the SIP until EPA takes final action approving or disapproving the new 
SIP revisions. However, if the District fails to submit these revisions 
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.
    There are no sanctions or Federal Implementation Plan (FIP) 
implications should the conditional approval become a disapproval. 
Sanctions would not be imposed under CAA section 179(b) because the 
submittal of Rule 2-4 is discretionary (i.e., not required to be 
included in the SIP). See ETPS, 51 FR 43,813 at 43,825 (``[S]tates are 
by no means required to adopt banking procedures, but . . . banks may 
help states and communities realize important planning and 
environmental benefits.''). A FIP would not be imposed under CAA 
section 110(c)(1) because the disapproval does not reveal a deficiency 
in the SIP that such a FIP must correct. Specifically: (1) The 
deficiencies identified herein do not impact or undermine the 
requirement that offsets satisfy the requirements of 40 CFR 51.165, 
including the requirement that offsets must satisfy the offset 
integrity criteria enumerated in 40 CFR 51.165(a)(3)(ii)(C)(1)(i) at 
the time of use; and (2) Rule 2-4 is not a required CAA submittal 
because states and air districts have the discretion, but are not 
required, to adopt banking rules.
    We will accept comments from the public on the proposed conditional 
approval of Rule 2-4 for the next 30 days.

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 BAAQMD Regulation 2, Rule 4 (Permits, Emissions Banking), 
which is discussed in section I.A. of this preamble. The EPA has made, 
and will continue to make, this document generally available 
electronically through https://www.regulations.gov and in hard copy at 
the appropriate EPA office (see the ADDRESSES section of this preamble 
for more information).

V. Statutory and Executive Order Reviews

    Additional information about these statutes and Executive Orders 
can be found at https://www2.epa.gov/laws-regulations/laws-and-executive-orders.

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 because this action does not impose additional requirements 
beyond those imposed by state law.

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 beyond those 
imposed by state law.

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. This action does not impose additional requirements 
beyond those imposed by state law. Accordingly, no additional costs to 
state, local, or tribal governments, or to the private sector, will 
result from this action.

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: Coordination With Indian Tribal Governments

    This action does not have tribal implications, as specified in 
Executive Order 13175, because 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

[[Page 43205]]

jurisdiction, and will not impose substantial direct costs on tribal 
governments or preempt tribal law. 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 does not impose additional 
requirements beyond those imposed by state law.

H. Executive Order 13211: Actions 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)

    Section 12(d) of the NTTAA directs the EPA to use voluntary 
consensus standards in its regulatory activities unless to do so would 
be inconsistent with applicable law or otherwise impractical. The EPA 
believes that this action is not subject to the requirements of section 
12(d) of the NTTAA because application of those requirements would be 
inconsistent with the CAA.

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

    The EPA lacks the discretionary authority to address environmental 
justice in this rulemaking.

List of Subjects in 40 CFR Part 52

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

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

    Dated: August 31, 2017.
Deborah Jordan,
Acting Regional Administrator, Region IX.
[FR Doc. 2017-19451 Filed 9-13-17; 8:45 am]
 BILLING CODE 6560-50-P



                                                      43202              Federal Register / Vol. 82, No. 177 / Thursday, September 14, 2017 / Proposed Rules

                                                      to previous notices (80 FR 69161; 81 FR                 Accountability System Negotiated                      restricted by statute. Multimedia
                                                      22039; 81 FR 54768; 82 FR 5473) you                     Rulemaking Committee is in the public                 submissions (audio, video, etc.) must be
                                                      must submit a new nomination package.                   interest.                                             accompanied by a written comment.
                                                      Previous applications will not be                         Authority: 20 U.S.C. 6301; 5 U.S.C. 561; 5          The written comment is considered the
                                                      considered. The BIE will not consider                   U.S.C. Appendix 2.                                    official comment and should include
                                                      nominations for Federal representatives.                                                                      discussion of all points you wish to
                                                                                                               Dated: September 1, 2017.
                                                      Only the Secretary may nominate                                                                               make. The EPA will generally not
                                                      Federal employees to the Committee.                     Michael S. Black,                                     consider comments or comment
                                                         Nominations must include the                         Acting Assistant Secretary—Indian Affairs.            contents located outside of the primary
                                                      following information about each                        [FR Doc. 2017–19111 Filed 9–13–17; 8:45 am]           submission (i.e. on the web, cloud, or
                                                      nominee:                                                BILLING CODE 4337–15–P                                other file sharing system). For
                                                         (1) A current letter from the entity                                                                       additional submission methods, please
                                                      representing one of the interest(s)                                                                           contact the person identified in the FOR
                                                      identified supporting the nomination of                 ENVIRONMENTAL PROTECTION                              FURTHER INFORMATION CONTACT section.
                                                      the individual to serve as a                            AGENCY                                                For the full EPA public comment policy,
                                                      representative for the Committee;                                                                             information about CBI or multimedia
                                                         (2) A resume reflecting the nominee’s                40 CFR Part 52                                        submissions, and general guidance on
                                                      qualifications and experience in Indian                 [EPA–R09–OAR–2017–0130; FRL–9967–68–                  making effective comments, please visit
                                                      education; resume to include the                        Region 9]                                             https://www2.epa.gov/dockets/
                                                      nominee’s name, Tribal affiliation (if                                                                        commenting-epa-dockets.
                                                      applicable), job title, major job duties,               Revisions to California State                         FOR FURTHER INFORMATION CONTACT:
                                                      employer, business address, business                    Implementation Plan; Bay Area Air                     Laura Yannayon, EPA Region 9, (415)
                                                      telephone and fax numbers (and                          Quality Management District; Emission                 972–3534, yannayon.laura@epa.gov.
                                                      business email address, if applicable);                 Reduction Credit Banking
                                                                                                                                                                    SUPPLEMENTARY INFORMATION:
                                                         (3) The interest(s) to be represented by
                                                                                                              AGENCY:  Environmental Protection                     Throughout this document, the terms
                                                      the nominee (see section V, part F) and
                                                                                                              Agency (EPA).                                         ‘‘we,’’ ‘‘us,’’ and ‘‘our’’ refer to EPA.
                                                      whether the nominee will represent
                                                      other interest(s) related to this                       ACTION: Proposed rule.                                Table of Contents
                                                      rulemaking; and                                                                                               I. The State’s Submittal
                                                                                                              SUMMARY:   The Environmental Protection
                                                         (4) A brief description of how the                                                                            A. What rule did the State submit?
                                                                                                              Agency (EPA) is proposing action on a
                                                      nominee will represent the views of the                                                                          B. What is the existing BAAQMD rule
                                                                                                              revision to the Bay Area Air Quality
                                                      identified interest(s), communicate with                                                                            governing banking of Emission
                                                                                                              Management District (BAAQMD or
                                                      constituents, and have a clear means to                                                                             Reduction Credits in the California SIP?
                                                                                                              District) portion of the California State                C. What is the purpose of this proposed
                                                      reach agreement on behalf of the
                                                                                                              Implementation Plan (SIP). We are                           rule?
                                                      interest(s) they are representing.
                                                                                                              proposing a conditional approval of one               II. EPA’s Evaluation
                                                         (5) A statement on whether the
                                                                                                              rule. This revision consists of updates to               A. How is EPA evaluating the rule?
                                                      nominee is only representing one
                                                                                                              provisions governing the issuance and                    B. Does the rule meet the evaluation
                                                      interest or whether the expectation is                                                                              criteria?
                                                                                                              banking of Emission Reduction Credits
                                                      that the nominee represents a specific                                                                        III. Proposed Action and Public Comment
                                                                                                              for use in the review and permitting of
                                                      group of interests.                                                                                           IV. Incorporation by Reference
                                                                                                              major sources and major modifications
                                                         To be considered, nominations must                                                                         V. Statutory and Executive Order Reviews
                                                                                                              under part D of title I of the Clean Air
                                                      be received by the close of business on
                                                                                                              Act (CAA). We are taking comments on
                                                      the date listed in the DATES section, at                                                                      I. The State’s Submittal
                                                                                                              this proposal and plan to follow with a
                                                      the location indicated in the ADDRESSES
                                                                                                              final action.                                         A. What rule did the State submit?
                                                      section.
                                                         Public Availability of Comments:                     DATES: Any comments must arrive by                      On April 22, 2013, the California Air
                                                      Before including your address, phone                    October 16, 2017.                                     Resources Board (CARB) submitted an
                                                      number, email address, or other                         ADDRESSES: Submit your comments,                      amended rule, BAAQMD Regulation 2,
                                                      personal identifying information in your                identified by Docket ID No. EPA–R09–                  Rule 4 (Rule 2–4), for approval as a
                                                      comment, you should be aware that                       OAR–2017–0130 at https://                             revision to the BAAQMD portion of the
                                                      your entire comment—including your                      www.regulations.gov, or via email to                  California SIP under the CAA.
                                                      personal identifying information—may                    R9AirPermits@epa.gov. For comments                    Regulation 2 contains the District’s air
                                                      be made publicly available at any time.                 submitted at Regulations.gov, follow the              quality permitting programs. Rule 2–4
                                                      While you can ask us in your comment                    online instructions for submitting                    contains requirements applicable to the
                                                      to withhold your personal identifying                   comments. Once submitted, comments                    banking of Emission Reduction Credits
                                                      information from public review, we                      cannot be removed or edited from                      (ERCs) for use in the District’s air
                                                      cannot guarantee that we will be able to                Regulations.gov. For either manner of                 quality permitting programs.
                                                      do so.                                                  submission, the EPA may publish any                     Table 1 lists the rule addressed by this
                                                                                                              comment received to its public docket.                proposal with the dates that it was
asabaliauskas on DSKBBXCHB2PROD with PROPOSALS




                                                      VII. Certification                                      Do not submit electronically any                      adopted by BAAQMD and submitted to
                                                        For the above reasons, I hereby certify               information you consider to be                        the EPA by CARB, which is the
                                                      that the Bureau of Indian Education                     Confidential Business Information (CBI)               governor’s designee for California SIP
                                                      Standards, Assessments, and                             or other information whose disclosure is              submittals.




                                                 VerDate Sep<11>2014   16:07 Sep 13, 2017   Jkt 241001   PO 00000   Frm 00008   Fmt 4702   Sfmt 4702   E:\FR\FM\14SEP1.SGM   14SEP1


                                                                                Federal Register / Vol. 82, No. 177 / Thursday, September 14, 2017 / Proposed Rules                                                                      43203

                                                                                                                                     TABLE 1—SUBMITTED RULE
                                                                                                                                                                                                                    Adopted/
                                                               Regulation & rule number                                                                 Rule title                                                                    Submitted
                                                                                                                                                                                                                    amended

                                                      Regulation 2, Rule 4 (Rule 2–4) ......                  Permits, Emissions Banking ......................................................................        12/19/12           4/22/13



                                                        On June 26, 2013, Regulation 2, Rule                                we have reviewed materials provided                                  Consistent with the District’s stated
                                                      4 was deemed to meet the completeness                                 with previous submittals.                                         intent to have the submitted banking
                                                      criteria in 40 CFR part 51, appendix V,                               B. What is the existing BAAQMD rule                               rule replace the existing SIP-approved
                                                      which must be met before formal EPA                                   governing banking of Emission                                     banking rule in its entirety, EPA’s
                                                      review. The submittal includes evidence                               Reduction Credits in the California SIP?                          conditional approval of the regulation
                                                      of public notice and adoption of the                                                                                                    identified in Table 1 would have the
                                                                                                                              The existing SIP-approved banking
                                                      amended rule. While we can only take                                                                                                    effect of entirely superseding our prior
                                                                                                                            rule in the Bay Area consists of the rule
                                                      action on the most recently submitted                                                                                                   approval of the same rule in the current
                                                                                                                            identified in Table 2. This rule includes
                                                      version of each regulation (which                                     requirements for the generation and use                           SIP-approved program.
                                                      supersedes earlier submitted versions),                               of ERCs in nonattainment areas.
                                                                                                                                   TABLE 2—EXISTING SIP RULE
                                                                                                                                                                                             BAAQMD               EPA approval
                                                            Regulation & rule No.                                                       Rule title                                                                                   FR citation
                                                                                                                                                                                           adoption date             date

                                                      2–4 ..........................................   Permits, Emissions Banking ...................................................            6/15/1994            1/26/1999     64 FR 3850.



                                                      C. What is the purpose of this proposed                               requirements for SIP revisions in CAA                             evaluation of BAAQMD’s submitted rule
                                                      rule?                                                                 sections 110(a)(2) and 110(l), and the                            and describe the identified deficiencies.
                                                        The purpose of this proposed rule is                                additional requirements laid out in 40                            Our TSD contains a more detailed
                                                      to present our evaluation under the                                   CFR 51.165(a)(3).                                                 evaluation and recommendations for
                                                      CAA and EPA’s regulations of the                                        Our TSD, which can be found in the                              program improvements.
                                                      amended banking rule submitted by                                     docket for this rule, contains a more                                First, Rule 2–4 is deficient because,
                                                      CARB on April 22, 2013, as identified                                 detailed evaluation and discussion of                             while it defines the term ERCs as
                                                      in Table 1. We provide our reasoning in                               the approval criteria.                                            emission reductions ‘‘that are in excess
                                                      general terms later in this preamble and                                                                                                of the reductions required by applicable
                                                                                                                            B. Does the rule meet the evaluation                              regulatory requirements, and that are
                                                      provide a more detailed analysis in our                               criteria?
                                                      Technical Support Document (TSD),                                                                                                       real, permanent, quantifiable, and
                                                      which is available in the docket for this                               With respect to procedural                                      enforceable,’’ it does not contain any
                                                      proposed rulemaking.                                                  requirements, CAA sections 110(a)(2)                              enforceable provisions requiring the Air
                                                                                                                            and 110(l) require that revisions to a SIP                        Pollution Control Officer to determine
                                                      II. EPA’s Evaluation                                                  be adopted by the State after reasonable                          that the emission reductions under
                                                      A. How is EPA evaluating the rule?                                    notice and public hearing. Based on our                           review meet the offset integrity criteria
                                                                                                                            review of the public process                                      prior to issuing an ERC Certificate.
                                                         In general, banking rules allow a
                                                                                                                            documentation included in the April 22,                              Second, Rule 2–4 is deficient because
                                                      permitting authority to evaluate whether
                                                                                                                            2013 submittal, we find that the                                  it incorporates the emission reduction
                                                      certain emission reductions meet the
                                                      offset integrity criteria found in 40 CFR                             BAAQMD has provided sufficient                                    calculation procedures found in Rule 2–
                                                      51.165(a)(3)(ii)(C)(1)(i) and CAA section                             evidence of public notice, and an                                 2 subsection 605.2. On August 1, 2016,
                                                      173(c)(1) at the time of ERC issuance,                                opportunity for comment and a public                              EPA finalized a limited approval and
                                                      and, if found to meet these criteria, to                              hearing prior to adoption and submittal                           limited disapproval of BAAQMD’s Rule
                                                      certify that finding by issuing an ERC                                of these rules to EPA.                                            2–2—New Source Review 2 because it
                                                      Certificate. This process provides the                                  With respect to substantive                                     contained deficiencies regarding the
                                                      Certificate-holder with a greater degree                              requirements, we have evaluated Rule                              calculation of emission reductions.
                                                      of certainty as to the validity of their                              2–4 to ensure it does not conflict with                           Specifically, EPA disapproved Rule 2–2
                                                      ERCs for future use as offsets. Since the                             the requirements applicable to offsets in                         subsection 605.2 because it allows
                                                      intent of a banking program is to pre-                                accordance with the CAA and                                       existing ‘‘fully-offset’’ sources to
                                                      review an emission reduction to                                       regulatory requirements that apply to                             generate ERCs based on the difference
                                                      determine whether it will meet the                                    nonattainment NSR permit programs                                 between the post-modification potential
                                                                                                                            under part D of title I of the Act. For the                       to emit (PTE) and the pre-modification
asabaliauskas on DSKBBXCHB2PROD with PROPOSALS




                                                      offset integrity criteria, we considered
                                                      these criteria in our evaluation. In                                  most part, the submitted banking rule                             PTE. This may result in crediting
                                                      addition, we used EPA’s Emissions                                     satisfies the applicable requirements                             emission reductions that are not
                                                      Trading Policy Statement (ETPS),1                                     and will strengthen the SIP by updating                           ‘‘actual’’ reductions, as required by the
                                                      which provides guidance on emissions                                  the rule and adding requirements to                               Act. See 42 U.S.C. 7503(c)(1).
                                                      trading, including the banking of ERCs                                address fine particulate matter (PM2.5).                             Third, Rule 2–4 is deficient because
                                                      for future use. EPA also evaluated the                                However, the submitted banking rule                               Section 2–4–302.3 allows ERC
                                                      rules for compliance with the CAA                                     also contains three deficiencies that                             Certificates to be issued that do not
                                                                                                                            prevent full approval. Further in this
                                                        1 51   FR 43814, December 4, 1986.                                  preamble, we discuss generally our                                   2 81   FR 50339, August 1, 2016.



                                                 VerDate Sep<11>2014         16:07 Sep 13, 2017        Jkt 241001    PO 00000     Frm 00009      Fmt 4702    Sfmt 4702     E:\FR\FM\14SEP1.SGM           14SEP1


                                                      43204              Federal Register / Vol. 82, No. 177 / Thursday, September 14, 2017 / Proposed Rules

                                                      adequately ensure the permanency of an                  the opportunity to correct the identified             at the appropriate EPA office (see the
                                                      emission reduction due to a facility                    deficiencies, as discussed in their                   ADDRESSES   section of this preamble for
                                                      closure.                                                commitment letter dated August 28,                    more information).
                                                        With respect to the substantive                       2017. If we finalize this action as
                                                      requirements of CAA section 110(l), we                                                                        V. Statutory and Executive Order
                                                                                                              proposed, our action would be codified
                                                      have determined that our approval of                    through revisions to 40 CFR 52.220                    Reviews
                                                      Rule 2–4, as described in more detail in                (Identification of plan) and 40 CFR                     Additional information about these
                                                      our TSD, represents a strengthening of                  52.232 (Part D conditional approval).                 statutes and Executive Orders can be
                                                      the rule as compared to the District’s                     If the State meets its commitment to               found at https://www2.epa.gov/laws-
                                                      current SIP-approved banking rule that                  submit the required measures by                       regulations/laws-and-executive-orders.
                                                      we approved on January 26, 1999 (64 FR                  November 1, 2018, the revisions to Rule
                                                      3850), and that our conditional approval                2–4 will remain a part of the SIP until               A. Executive Order 12866: Regulatory
                                                      of the current SIP submittal would not                  EPA takes final action approving or                   Planning and Review and Executive
                                                      interfere with any applicable                           disapproving the new SIP revisions.                   Order 13563: Improving Regulation and
                                                      requirement concerning attainment and                   However, if the District fails to submit              Regulatory Review
                                                      Reasonable Further Progress or any                      these revisions within the required                     This action is not a significant
                                                      other applicable requirement of the Act.                timeframe, the conditional approval will              regulatory action and was therefore not
                                                                                                              automatically become a disapproval,                   submitted to the Office of Management
                                                      III. Proposed Action and Public
                                                                                                              and EPA will issue a finding of                       and Budget (OMB) for review.
                                                      Comment
                                                                                                              disapproval. EPA is not required to
                                                         Because the rule deficiencies                                                                              B. Paperwork Reduction Act (PRA)
                                                                                                              propose the finding of disapproval.
                                                      described previously are inappropriate                     There are no sanctions or Federal                    This action does not impose an
                                                      for inclusion in the SIP, EPA cannot                    Implementation Plan (FIP) implications                information collection burden under the
                                                      grant full approval of this rule under                  should the conditional approval become                PRA because this action does not
                                                      section 110(k)(3) of the Act. However, in               a disapproval. Sanctions would not be                 impose additional requirements beyond
                                                      a letter dated August 28, 2017, the                     imposed under CAA section 179(b)                      those imposed by state law.
                                                      District committed to adopt and submit                  because the submittal of Rule 2–4 is
                                                      specific enforceable measures to address                discretionary (i.e., not required to be               C. Regulatory Flexibility Act (RFA)
                                                      these deficiencies. The District                        included in the SIP). See ETPS, 51 FR                    I certify that this action will not have
                                                      committed to submit these revisions to                  43,813 at 43,825 (‘‘[S]tates are by no                a significant economic impact on a
                                                      CARB by October 1, 2018. In addition,                   means required to adopt banking                       substantial number of small entities
                                                      in a letter dated August 29, 2017, CARB                 procedures, but . . . banks may help                  under the RFA. This action will not
                                                      committed to submit the adopted rule                    states and communities realize                        impose any requirements on small
                                                      revisions to EPA no later than                          important planning and environmental                  entities beyond those imposed by state
                                                      November 1, 2018. Accordingly,                          benefits.’’). A FIP would not be imposed              law.
                                                      pursuant to section 110(k)(4) of the Act,               under CAA section 110(c)(1) because
                                                      EPA is proposing a conditional approval                                                                       D. Unfunded Mandates Reform Act
                                                                                                              the disapproval does not reveal a
                                                      of the submitted rule. We are proposing                                                                       (UMRA)
                                                                                                              deficiency in the SIP that such a FIP
                                                      to conditionally approve the submitted                  must correct. Specifically: (1) The                     This action does not contain any
                                                      rule based on our determination that                    deficiencies identified herein do not                 unfunded mandate as described in
                                                      separate from the deficiencies listed                   impact or undermine the requirement                   UMRA, 2 U.S.C. 1531–1538, and does
                                                      previously, the rule: Ensures that issued               that offsets satisfy the requirements of              not significantly or uniquely affect small
                                                      ERCs will meet the criteria laid out in                 40 CFR 51.165, including the                          governments. This action does not
                                                      40 CFR 51.165(a)(3)(ii)(C)(1)(i) at the                 requirement that offsets must satisfy the             impose additional requirements beyond
                                                      time of ERC issuance; satisfies the                     offset integrity criteria enumerated in 40            those imposed by state law.
                                                      requirements of 40 CFR 51.165(a)(3)(i);                 CFR 51.165(a)(3)(ii)(C)(1)(i) at the time             Accordingly, no additional costs to
                                                      satisfies the applicable requirements                   of use; and (2) Rule 2–4 is not a required            state, local, or tribal governments, or to
                                                      found in the ETPS; and satisfies the                    CAA submittal because states and air                  the private sector, will result from this
                                                      requirements of 40 CFR                                  districts have the discretion, but are not            action.
                                                      51.165(a)(3)(ii)(C)(1)(ii), which requires              required, to adopt banking rules.
                                                      pre-base year shutdown credits to be                                                                          E. Executive Order 13132: Federalism
                                                                                                                 We will accept comments from the
                                                      explicitly added back in to the most                    public on the proposed conditional                      This action does not have federalism
                                                      recent applicable air quality plans.                    approval of Rule 2–4 for the next 30                  implications. It will not have substantial
                                                      Moreover, we conclude that if the                       days.                                                 direct effects on the states, on the
                                                      District submits the changes it has                                                                           relationship between the national
                                                      committed to submit, these deficiencies                 IV. Incorporation by Reference                        government and the states, or on the
                                                      will be cured.                                            In this rule, the EPA is proposing to               distribution of power and
                                                         In support of this proposed action, we               include in a final EPA rule, regulatory               responsibilities among the various
                                                      have concluded that our conditional                     text that includes incorporation by                   levels of government.
                                                      approval of the submitted rule would                    reference. In accordance with
asabaliauskas on DSKBBXCHB2PROD with PROPOSALS




                                                      comply with section 110(l) of the Act                   requirements of 1 CFR 51.5, the EPA is                F. Executive Order 13175: Coordination
                                                      because the amended rule, as a whole,                   proposing to incorporate by reference                 With Indian Tribal Governments
                                                      would not interfere with continued                      BAAQMD Regulation 2, Rule 4 (Permits,                   This action does not have tribal
                                                      attainment of the National Ambient Air                  Emissions Banking), which is discussed                implications, as specified in Executive
                                                      Quality Standards in the Bay Area. The                  in section I.A. of this preamble. The                 Order 13175, because the SIP is not
                                                      intended effect of our proposed                         EPA has made, and will continue to                    approved to apply on any Indian
                                                      conditional approval action is to update                make, this document generally available               reservation land or in any other area
                                                      the applicable SIP with current                         electronically through https://                       where the EPA or an Indian tribe has
                                                      BAAQMD rules and provide BAAQMD                         www.regulations.gov and in hard copy                  demonstrated that a tribe has


                                                 VerDate Sep<11>2014   16:07 Sep 13, 2017   Jkt 241001   PO 00000   Frm 00010   Fmt 4702   Sfmt 4702   E:\FR\FM\14SEP1.SGM   14SEP1


                                                                         Federal Register / Vol. 82, No. 177 / Thursday, September 14, 2017 / Proposed Rules                                          43205

                                                      jurisdiction, and will not impose                       ENVIRONMENTAL PROTECTION                              Region 8, Mailcode 8P–AR, 1595
                                                      substantial direct costs on tribal                      AGENCY                                                Wynkoop Street, Denver, Colorado
                                                      governments or preempt tribal law.                                                                            80202–1129, (303) 312–6602,
                                                      Thus, Executive Order 13175 does not                    40 CFR Part 52                                        ostigaard.crystal@epa.gov.
                                                      apply to this action.                                   [EPA–R08–OAR–2017–0469; FRL–9967–67–                  SUPPLEMENTARY INFORMATION:
                                                                                                              Region 8]
                                                      G. Executive Order 13045: Protection of                                                                       I. General Information
                                                      Children From Environmental Health                      Approval and Promulgation of Air                         a. Submitting CBI. Do not submit CBI
                                                      Risks and Safety Risks                                  Quality Implementation Plans; State of                to the EPA through https://
                                                        The EPA interprets Executive Order                    Utah; Revisions to the Utah Division of               www.regulations.gov or email. Clearly
                                                      13045 as applying only to those                         Administrative Rules, R307–300                        mark the part or all of the information
                                                      regulatory actions that concern                         Series; Area Source Rule for                          that you claim to be CBI. For CBI
                                                                                                              Attainment of Fine Particulate Matter                 information in a disk or CD–ROM that
                                                      environmental health or safety risks that
                                                                                                              Standards                                             you mail to the EPA, mark the outside
                                                      the EPA has reason to believe may
                                                      disproportionately affect children, per                 AGENCY:  Environmental Protection                     of the disk or CD–ROM as CBI and then
                                                      the definition of ‘‘covered regulatory                  Agency (EPA).                                         identify electronically within the disk or
                                                      action’’ in section 2–202 of the                                                                              CD–ROM the specific information that
                                                                                                              ACTION: Proposed rule.
                                                      Executive Order. This action is not                                                                           is claimed as CBI. In addition to one
                                                      subject to Executive Order 13045                        SUMMARY:   The Environmental Protection               complete version of the comment that
                                                      because it does not impose additional                   Agency (EPA) is proposing to approve                  includes information claimed as CBI, a
                                                      requirements beyond those imposed by                    portions of the fine particulate matter               copy of the comment that does not
                                                      state law.                                              (PM2.5) State Implementation Plan (SIP)               contain the information claimed as CBI
                                                                                                              and related rule revisions submitted by               must be submitted for inclusion in the
                                                      H. Executive Order 13211: Actions That                  the State of Utah. The EPA is proposing               public docket. Information so marked
                                                      Significantly Affect Energy Supply,                     to approve revisions submitted on May                 will not be disclosed except in
                                                      Distribution, or Use                                    9, 2013 and August 25, 2017 for Utah’s                accordance with procedures set forth in
                                                                                                              fugitive dust control rule, and to                    40 CFR part 2.
                                                        This action is not subject to Executive               approve the State’s associated                           b. Tips for Preparing Your Comments.
                                                      Order 13211, because it is not a                        reasonable available control measures                 When submitting comments, remember
                                                      significant regulatory action under                     (RACM) determination, submitted on                    to:
                                                      Executive Order 12866.                                  December 16, 2014. This action is being                  i. Identify the rulemaking by docket
                                                      I. National Technology Transfer and                     taken under section 110 of the Clean Air              number and other identifying
                                                      Advancement Act (NTTAA)                                 Act (CAA or Act).                                     information (subject heading, Federal
                                                                                                              DATES: Written comments must be                       Register date and page number).
                                                        Section 12(d) of the NTTAA directs                    received on or before October 16, 2017.                  ii. Follow directions—The agency
                                                      the EPA to use voluntary consensus                      ADDRESSES: Submit your comments,                      may ask you to respond to specific
                                                      standards in its regulatory activities                  identified by Docket ID No. EPA–R08–                  questions or organize comments by
                                                      unless to do so would be inconsistent                   OAR–2017–0469 at https://                             referencing a Code of Federal
                                                      with applicable law or otherwise                        www.regulations.gov. Follow the online                Regulations (CFR) part or section
                                                      impractical. The EPA believes that this                 instructions for submitting comments.                 number.
                                                      action is not subject to the requirements               Once submitted, comments cannot be                       iii. Explain why you agree or disagree;
                                                      of section 12(d) of the NTTAA because                   edited or removed from https://                       suggest alternatives and substitute
                                                      application of those requirements would                 www.regulations.gov. The EPA may                      language for your requested changes.
                                                      be inconsistent with the CAA.                           publish any comment received to the                      iv. Describe any assumptions and
                                                                                                              public docket. Do not submit                          provide any technical information and/
                                                      J. Executive Order 12898: Federal                       electronically any information you                    or data that you used.
                                                      Actions To Address Environmental                        consider to be Confidential Business                     v. If you estimate potential costs or
                                                      Justice in Minority Populations and                     Information (CBI) or other information,               burdens, explain how you arrived at
                                                      Low-Income Population                                   the disclosure of which is restricted by              your estimate in sufficient detail to
                                                                                                              statute. Multimedia submissions (audio,               allow for it to be reproduced.
                                                        The EPA lacks the discretionary                                                                                vi. Provide specific examples to
                                                      authority to address environmental                      video, etc.) must be accompanied by a
                                                                                                              written comment. The written comment                  illustrate your concerns, and suggest
                                                      justice in this rulemaking.                                                                                   alternatives.
                                                                                                              is considered the official comment and
                                                      List of Subjects in 40 CFR Part 52                      should include discussion of all points                  vii. Explain your views as clearly as
                                                                                                              you wish to make. The EPA will                        possible, avoiding the use of profanity
                                                        Environmental protection, Air                         generally not consider comments or                    or personal threats.
                                                      pollution control, Incorporation by                     comment contents located outside of the                  viii. Make sure to submit your
                                                      reference, Intergovernmental relations,                 primary submission (i.e., on the web,                 comments by the comment period
                                                      Nitrogen dioxide, Ozone, Particulate                    cloud, or other file sharing system). For             deadline identified.
asabaliauskas on DSKBBXCHB2PROD with PROPOSALS




                                                      Matter, Reporting and recordkeeping                     additional submission methods, the full               II. Background
                                                      requirements.                                           EPA public comment policy,
                                                         Authority: 42 U.S.C. 7401 et seq.                    information about CBI or multimedia                   A. Regulatory Background
                                                                                                              submissions, and general guidance on                    On October 17, 2006 (71 FR 61144),
                                                        Dated: August 31, 2017.
                                                                                                              making effective comments, please visit               the EPA strengthened the level of the
                                                      Deborah Jordan,                                         https://www.epa.gov/dockets/                          24-hour PM2.5 National Ambient Air
                                                      Acting Regional Administrator, Region IX.               commenting-epa-dockets.                               Quality Standards (NAAQS), lowering
                                                      [FR Doc. 2017–19451 Filed 9–13–17; 8:45 am]             FOR FURTHER INFORMATION CONTACT:                      the primary and secondary standards
                                                      BILLING CODE 6560–50–P                                  Crystal Ostigaard, Air Program, EPA,                  from 65 micrograms per cubic meter


                                                 VerDate Sep<11>2014   16:07 Sep 13, 2017   Jkt 241001   PO 00000   Frm 00011   Fmt 4702   Sfmt 4702   E:\FR\FM\14SEP1.SGM   14SEP1



Document Created: 2017-09-13 23:49:15
Document Modified: 2017-09-13 23:49:15
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionProposed Rules
ActionProposed rule.
DatesAny comments must arrive by October 16, 2017.
ContactLaura Yannayon, EPA Region 9, (415) 972-3534, [email protected]
FR Citation82 FR 43202 
CFR AssociatedEnvironmental Protection; Air Pollution Control; Incorporation by Reference; Intergovernmental Relations; Nitrogen Dioxide; Ozone; Particulate Matter and Reporting and Recordkeeping Requirements

2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR