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C. Petitions for Judicial Review March 15, 2018 and amended by email No. EPA–HQ–OAR–2018–0048. All Under section 307(b)(1) of the CAA, on May 1, 2020, certifying that there are documents in the docket are listed in petitions for judicial review of this no existing municipal solid waste the https://www.regulations.gov action must be filed in the United States landfills in the City of Philadelphia that website. Although listed in the index, Court of Appeals for the appropriate are subject to 40 CFR part 60, subpart some information may not be publicly circuit by January 25, 2021. Filing a Cf. available, e.g., Confidential Business petition for reconsideration by the [FR Doc. 2020–24690 Filed 11–23–20; 8:45 am] Information or other information whose Administrator of this final rule does not BILLING CODE 6560–50–P disclosure is restricted by statute. affect the finality of this action for the Certain other material, such as purposes of judicial review nor does it copyrighted material, is not placed on extend the time within which a petition ENVIRONMENTAL PROTECTION the internet and will be publicly for judicial review may be filed, and AGENCY available only in hard copy. Publicly shall not postpone the effectiveness of available docket materials are available such rule or action. 40 CFR Parts 51 and 52 electronically through https:// This action, approving the negative [EPA–HQ–OAR–2018–0048; FRL–10016–21– www.regulations.gov. declarations submitted by the City of OAR] In addition, the EPA has a website for NSR rulemakings at: https:// Philadelphia and the District of RIN 2060–AT89 Columbia, certifying that there are no www.epa.gov/nsr. The website includes the EPA’s proposed and final NSR existing municipal solid waste landfills Prevention of Significant Deterioration regulations, as well as guidance in the City of Philadelphia or the (PSD) and Nonattainment New Source documents and technical information District of Columbia that are subject to Review (NNSR): Project Emissions related to preconstruction permitting. the requirements of 40 CFR part 60 Accounting subpart Cf, may not be challenged later FOR FURTHER INFORMATION CONTACT: For in proceedings to enforce its AGENCY: Environmental Protection further information concerning this requirements. (See section 307(b)(2).) Agency (EPA). action, please contact Jessica Montan˜ ez, ACTION: Final rule. U.S. EPA, Office of Air Quality Planning List of Subjects in 40 CFR Part 62 and Standards, Air Quality Policy Environmental protection, Air SUMMARY: The Environmental Protection Division, Mail Code C504–03, 109 T.W. pollution control, Intergovernmental Agency (EPA) is promulgating revisions Alexander Drive, Research Triangle relations, Reporting andrecordkeeping to its major New Source Review (NSR) Park, NC 27709; by telephone at (919) requirements. applicability regulations to clarify when 541–3407 or by email at the requirement to obtain a major NSR [email protected]. Dated: November 2, 2020. permit applies to a source proposing to SUPPLEMENTARY INFORMATION: Cosmo Servidio, undertake a physical change or a change Regional Administrator, Region III. in the method of operation (i.e., a Throughout this document, wherever ‘‘we,’’ ‘‘us,’’ or ‘‘our’’ is used, we mean For the reasons stated in the project) under the major NSR the EPA and wherever ‘‘reviewing preamble, the EPA amends 40 CFR part preconstruction permitting programs. authorities,’’ or ‘‘air agencies’’ is used, 62 as follows: Under these programs, an existing major stationary source proposing to we mean air pollution control agencies. PART 62—APPROVAL AND undertake a project must determine I. General Information PROMULGATION OF STATE PLANS whether that project will constitute a FOR DESIGNATED FACILITIES AND major modification subject to the major A. Does this action apply to me? POLLUTANTS NSR preconstruction permitting Entities potentially affected directly requirements by following a two-step by this action include sources in all ■ 1. The authority citation for part 62 applicability test. The first step is to industry categories. Entities potentially continues to read as follows: determine if the proposed project would affected directly by this action also Authority: 42 U.S.C. 7401 et seq. result in a ‘‘significant emissions include state, local and tribal air increase’’ of a regulated NSR pollutant pollution control agencies responsible Subpart J—District of Columbia (Step 1). If the proposed project is for permitting sources pursuant to the determined to result in such an major NSR programs requirements. ■ 2. Revise § 62.2140 to read as follows: increase, the second step is to determine B. Where can I get a copy of this if the project would also result in a § 62.2140 Identification of plan—negative document and other related declaration. ‘‘significant net emissions increase’’ of information? Letter from the District of Columbia, that pollutant from the source (Step 2). Department of Energy and Environment, In this action, we are promulgating In addition to being available in the submitted November 15, 2019, revisions to our major NSR applicability docket, an electronic copy of this certifying that there are no existing regulations to clarify that both increases Federal Register document will be municipal solid waste landfills in the and decreases in emissions resulting posted at https://www.epa.gov/nsr. District of Columbia that are subject to from a proposed project can be C. How is this document organized? 40 CFR part 60, subpart Cf. considered in Step 1 of the major NSR major modification applicability test. The information presented in this Subpart NN—Pennsylvania We refer to the consideration of document is organized as follows: emissions increases and decreases in I. General Information ■ 3. Revise § 62.9633 to read as follows: Step 1 as project emissions accounting. A. Does this action apply to me? B. Where can I get a copy of this document DATES: This final rule is effective on § 62.9633 Identification of plan—negative and other related information? declaration. December 24, 2020. C. How is this document organized? Letter from the City of Philadelphia, ADDRESSES: The EPA has established a II. Background Department of Public Health, submitted docket for this action under Docket ID A. The New Source Review Program

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B. Major Modifications Under the NSR Step 1 of the NSR major modification thresholds are subject to major NSR Program applicability test in a process known as requirements, while smaller emitting C. Project Emissions Accounting project emissions accounting. sources and modifications may be D. Legal Analysis and Policy Rationale In the subsections that follow, the subject to minor NSR requirements or be III. Final Action EPA introduces the NSR program and A. Summary of Final Action excluded from NSR altogether. B. Comments Received and Basis for Final summarizes information from the Major NSR permits for sources that Action proposal, including: (1) What are located in attainment or 1. General Comments on the Proposal constitutes a major modification under unclassifiable areas are referred to as 2. Revisions to Step 1 of the NSR Major the major NSR programs, (2) the project Prevention of Significant Deterioration Modification Applicability Test emissions accounting process and its (PSD) permits. These permits can also 3. Legal Rationale place in the major modification cover pollutants for which there are no 4. Defining the Scope of a Project applicability test, and (3) the legal NAAQS. Major NSR permits for sources 5. Monitoring, Recordkeeping and rationale for the regulatory revisions located in nonattainment areas and that Reporting of Emissions Decreases in Step that were proposed. The history of the emit pollutants above the specified 1 of the NSR Major Modification EPA’s treatment of emissions increases thresholds for which the area is in Applicability Test 6. Considering Emissions Decreases in Step and decreases in Step 1 of the major nonattainment are referred to as 1 for Delegated and SIP-Approved modification applicability test, nonattainment NSR (NNSR) permits. Programs including the March 2018 Memorandum The pollutant(s) at issue and the air 7. Environmental and Economic Impact titled ‘‘Project Emissions Accounting quality designation of the area where Considerations of Project Emissions Under the New Source Review the facility is located or proposed to be Accounting Preconstruction Permitting Program,’’ 2 built determine the specific permitting IV. Environmental Justice Considerations was provided in the notice of proposed requirements. The CAA requires sources V. Statutory and Executive Order Reviews rulemaking and will not be restated subject to PSD to meet emission limits A. Executive Order 12866: Regulatory here. The public comment period for based on Best Available Control Planning and Review and Executive this proposed rule ended on October 8, Technology (BACT) as specified by CAA Order 13563: Improving Regulation and Regulatory Review 2019. section 165(a)(4), and sources subject to NNSR to meet Lowest Achievable B. Executive Order 13771: Reducing A. The New Source Review Program Regulations and Controlling Regulatory Emissions Rate (LAER) pursuant to CAA Costs As established under the Clean Air section 173(a)(2). Other requirements to C. Paperwork Reduction Act (PRA) Act (CAA), the NSR program is a obtain a major NSR permit vary D. Regulatory Flexibility Act (RFA) preconstruction permitting program that depending on whether it is a PSD or E. Unfunded Mandates Reform Act requires certain stationary sources of air NNSR permit. (UMRA) pollution to obtain permits prior to A new stationary source is subject to F. Executive Order 13132: Federalism beginning construction. The NSR major NSR requirements if its potential G. Executive Order 13175: Consultation permitting program applies to both new to emit (PTE) a regulated NSR pollutant and Coordination With Indian Tribal construction and to modifications of exceeds statutory emission thresholds.4 Governments existing sources, regardless of whether H. Executive Order 13045: Protection of If it exceeds the applicable threshold, Children From Environmental Health the source is in an area where the the NSR regulations define it as a and Safety Risks national ambient air quality standards ‘‘major stationary source.’’ 5 I. Executive Order 13211: Actions That (NAAQS) have been exceeded An existing major stationary source Significantly Affect Energy Supply, (nonattainment area) or if the source is triggers major NSR permitting Distribution or Use in an area where the NAAQS have not requirements when it undergoes a J. National Technology Transfer and been exceeded (attainment or ‘‘major modification.’’ The EPA’s Advancement Act (NTTAA) unclassifiable area). New construction implementing regulations for NSR K. Executive Order 12898: Federal Actions and modifications that emit ‘‘regulated establish a two-step process for to Address Environmental Justice in NSR pollutants’’ 3 over certain determining major NSR applicability for Minority Populations and Low-Income Populations projects at stationary sources. To be 2 L. Congressional Review Act (CRA) Letter from E. Scott Pruitt, to Regional subject to major NSR requirements, the Administrators, ‘‘Project Emissions Accounting project must result in both (1) a M. Judicial Review Under the New Source Review Preconstruction VI. Statutory Authority Permitting Program,’’ March 13, 2018 (‘‘March 2018 significant emissions increase from the Memorandum’’) available at: https://www.epa.gov/ project (the determination of which is II. Background sites/production/files/2018-03/documents/nsr_ On August 9, 2019, the EPA memo_03-13-2018.pdf. As indicated in the are certain modification provisions under Title I, proposed 1 to revise its major NSR proposal, the March 2018 Memorandum explained Subpart D of the CAA and the EPA nonattainment that ‘‘the EPA interpreted the current NSR NSR regulations that apply to certain nonattainment applicability regulations to clarify when regulations as providing that emissions decreases as area classifications. For example, CAA the requirement to obtain a permit well as increases are to be considered in Step 1 of section182(e)(2) and 40 CFR part 51, Appendix S applies to an existing major stationary the NSR applicability process, where those 11.A.5.(v). This final rule does not cover those source proposing to undertake a decreases and increases are part of a single project.’’ provisions. We cite to 40 CFR 52.21 for More specifically, in the March 2018 Memorandum convenience, but the regulatory revisions we are physical change or change in the the EPA interpreted the current major NSR finalizing apply to other regulations as specified in method of operation (i.e., project) under regulations to mean that emissions increases and the regulatory text section of this final rule. the major NSR preconstruction decreases could be considered in Step 1 for projects 4 For PSD, the statute uses the term ‘‘major permitting programs. More specifically, that involve multiple types of emissions units in the emitting facility’’ which is defined as a stationary same manner as they are considered for projects source that emits, or has a PTE, at least 100 tons the EPA proposed to revise its NSR that only involve new or only involve existing per year (tpy) if the source is in one of 28 listed applicability regulations to make it clear emissions units. source categories—or at least 250 tpy if the source that both emissions increases and 3 40 CFR 52.21(b)(50). The regulations at 40 CFR is not—of ‘‘any air pollutant.’’ CAA section 169(1). decreases that result from a given 52.21 apply to the federal PSD program. The EPA For NNSR, the emissions threshold for a major has other NSR regulations including 40 CFR 51.165, stationary source is 100 tpy, although lower proposed project are to be considered in 51.166, and Appendix S of part 51, that contain thresholds may apply depending on the degree of analogous provisions. This final rule also applies to the nonattainment problem and the pollutant. 1 84 FR 39244 (August 9, 2019). those analogous provisions as well. However, there 5 40 CFR 52.21(b)(1)(i).

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called ‘‘Step 1’’ of the NSR applicability (as determined in Step 1 of the NSR the procedure for calculating whether a analysis); and (2) a significant net major modification applicability test) proposed project would result in a emissions increase at the stationary and a significant net emissions increase significant emissions increase depends source, taking account of emission of that pollutant (as determined in Step upon the type of emissions unit(s) 16 increases and emission decreases 2 of the major modification applicability that would be included in the proposed attributable to other projects undertaken test) 10 from the major stationary source. project. The emissions units involved in at the stationary source within a specific This two-step applicability test, which a project can be new, existing, or a time frame (called ‘‘Step 2’’ of the NSR has been an element of the NSR combination of new and existing units applicability analysis, or programs since the 1980’s, was codified (i.e., multiple types of emissions ‘‘contemporaneous netting’’). For this by the 2002 NSR Reform Rule 11 to units).17 For new units,18 the NSR two-step process, the NSR regulations explicitly include the prior EPA practice regulations require the difference in pre- define what emissions rate constitutes of looking first at whether any emissions and post-project emissions to be ‘‘significant’’ for each NSR pollutant.6 increase that would result from a calculated based on the difference In many cases, these requirements of project 12 by itself is significant before between a unit’s baseline actual the major NSR program (or equivalent evaluating whether there would be a emissions (as applicable to new requirements) are formally adopted by a significant ‘‘net emission increase’’ 13 emissions units) 19 and its potential to state or local air agency, and the agency from the major stationary source. In emit 20 after the project. For existing submits a revised state implementation other words, Step 1 considers the effect units,21 the NSR regulations require that plan (SIP) to the EPA for approval. The of the project alone and Step 2 considers the difference in pre- and post-project EPA’s regulations provide for the the effect of the project and any other emissions be calculated based on the minimum requirements of these emissions changes at the major difference between a unit’s baseline programs. Upon the EPA approving the stationary source that are actual emissions (as applicable to SIP, the air agency becomes the contemporaneous to the project (i.e., existing emissions units) 22 and its ‘‘reviewing authority’’ for major NSR generally within a 5-year period) and projected actual emissions 23 after the permits for sources within its creditable. project. Baseline actual emissions for boundaries. When a state or local air An emissions increase of a regulated new units are based on the units’ agency is not the permitting authority, NSR pollutant is considered significant potential to emit before the project.24 either the EPA issues the major NSR if the emissions increase in Step 1 or 2, Potential to emit represents a unit’s permits or a state or local air agency would be equal to or greater than any of maximum capacity to emit a pollutant issues the major NSR permits on behalf the pollutant-specific Significant under its physical and operational of the EPA by way of a delegation Emissions Rates (SERs) listed under the design. Baseline actual emissions for agreement. For sources located in Indian definition of ‘‘significant’’ in the existing units are determined based on 14 country, the EPA is currently the only applicable PSD or NNSR regulations. the rate of actual emissions (in tons per permitting authority for major NSR. The SERs in the existing NSR year) a unit has emitted in the past. Currently, state and local air agencies regulations are based on an EPA Projected actual emissions for existing issue the vast majority of major NSR determination that increases in units are determined based on the permits each year. emissions below these levels are de maximum rate of actual emissions (in New sources and modifications that minimis and thus need not be subject to tons per year) a unit is projected to emit do not require a major NSR permit may major NSR permitting. For those in the future. instead require a minor NSR permit regulated NSR pollutants not Once a source determines that a specifically listed, any increase in significant emissions increase would prior to construction. Minor NSR 15 permits are almost exclusively issued by emissions is significant. In addition, occur in Step 1, then the source may state and local air agencies, although the deem the project to be a major any pollutant for which a NAAQS has been EPA issues minor NSR permits in some promulgated and other pollutants such as sulfuric emissions rate or any net emissions increase areas of Indian country. Minor NSR acid mist and hydrogen sulfide, among others. associated with a major stationary source or major requirements are approved into a SIP in 10 The NSR major modification applicability test modification, which would construct within 10 order to achieve and maintain the is described in 40 CFR 52.21(a)(2)(iv)(a). kilometers of a Class I area, and have an impact on 11 NAAQS.7 The CAA and the EPA’s In 2002, the EPA issued a final rule that revised such area equal to or greater than 1 mg/m3, (24-hour the regulations governing the major NSR program. average). regulations are less prescriptive The agency refers generally to this rule as the ‘‘NSR 16 40 CFR 52.21(b)(7). There are two types of regarding minimum requirements for Reform Rule.’’ As part of this 2002 rule, the EPA emissions units, new and existing. A ‘‘replacement minor NSR, thus, air agencies generally revised the NSR applicability requirements for unit’’ as defined in the NSR regulations is an modifications to allow sources more flexibility to have more flexibility in designing their existing emissions unit. respond to rapidly changing markets and plan for 17 40 CFR 52.21(a)(2)(iv). minor NSR programs. future investments in pollution control and 18 40 CFR 52.21(b)(7)(i). The NSR regulations prevention technologies. 67 FR 80185 (December define a ‘‘new emissions unit’’ as ‘‘any emissions B. Major Modifications Under the NSR 31, 2002). 12 unit that is (or will be) newly constructed and that Program 40 CFR 52.21(b)(52). We use the term ‘‘project’’ has existed for less than two years from the date to mean the physical change or change in method In the proposal, the EPA explained such emission unit first operated.’’ of operation under review, though this can 19 encompass one or more activities at an existing 40 CFR 52.21(b)(48)(iii). that our NSR regulations define a major 20 modification 8 as any physical change or major source. A subsequent section of this rule’s 40 CFR 52.21(b)(4). preamble discusses how multiple activities should 21 40 CFR 52.21(b)(7)(ii). change in the method of operation of an be evaluated to determine whether these activities 22 40 CFR 52.21(b)(48)(i) and (ii). existing major stationary source that constitute one project. 23 40 CFR 52.21(b)(41). A source may elect to use would result in a significant emissions 13 40 CFR 52.21(b)(3). the potential to emit for the emissions unit in lieu increase of a regulated NSR pollutant 9 14 40 CFR 52.21(b)(23) defines when emissions of of projected actual emissions as provided by 40 CFR listed pollutants are considered significant under 52.21(b)(41)(ii)(d). the federal PSD program. These pollutants include, 24 6 The ‘‘baseline actual emissions for purposes of 40 CFR 52.21(b)(23). but are not limited to, the following: Pollutants for determining the emissions increase that will result 7 CAA section 110(a)(2)(C). which a NAAQS has been promulgated, fluorides, from the initial construction and operation of such 8 40 CFR 52.21(b)(2). and sulfuric acid mist. unit shall equal zero; and thereafter, for all other 9 ‘‘Regulated NSR pollutant’’ is defined at 40 CFR 15 40 CFR 52.21(b)(23)(ii). Per 40 CFR purposes, shall equal the unit’s potential to emit.’’ 52.21(b)(50). A ‘‘regulated NSR pollutant’’ includes 52.21(b)(23)(iii), significant also means any 40 CFR 52.21(b)(48)(iii).

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modification or perform the Step 2 particular change occurs.’’ 28 An project’’ 35 in the process known as contemporaneous netting analysis to increase or decrease in actual emissions ‘‘project emissions accounting.’’ determine if there would be a significant in Step 2 is creditable only if the EPA A project can involve new, existing, net emissions increase at the major Administrator or other reviewing or a combination of new and existing source and thus be subject to major NSR authority has not relied on it in issuing units. Before the March 2018 permitting.25 A net emissions increase a PSD or NNSR permit for the source Memorandum, there was uncertainty means, with respect to any regulated and the permit is still in effect at the and confusion on whether both NSR pollutant emitted at a major time the major modification occurs.29 increases and decreases could be stationary source, the amount by which Furthermore, emissions increases in considered at Step 1 for all types of the sum of the following exceeds zero: Step 2 are only creditable if the new emissions units because of a slight (a) [t]he increase in emissions from a level of actual emissions exceeds the old variation in the regulatory text used for particular physical change or change in level of actual emissions.30 Emissions the NSR major modification the method of operation at a stationary decreases in Step 2, on the other hand, applicability test that applies to projects source as calculated pursuant to [40 are creditable only to the extent that the that involve a combination of new and CFR 52.21](a)(2)(iv); and (b) [a]ny other old level of actual emissions or the old existing units (i.e., hybrid test) as increases and decreases in actual level of allowable emissions, whichever compared to the major modification emissions at the major stationary source is lower, exceeds the new level of actual applicability tests that apply to only that are contemporaneous with the emissions and the decrease in actual new or only existing units. As we particular change and are otherwise emissions is enforceable as a practical explained further in the March 2018 26 creditable. The Step 2 matter at and after the time that actual Memorandum and in this rule’s contemporaneous netting analysis is construction of the particular change proposal, the regulatory text for new conducted by adding the emissions begins.31 In nonattainment areas, units and existing units use the phrase 27 increase from the project as emissions reductions are also only ‘‘sum of the difference,’’ while the determined in Step 1 to all other creditable if they have not been relied hybrid test used the phrase ‘‘sum of the increases and decreases in actual upon for demonstrating attainment or increases.’’ In the March 2018 emissions at the major stationary source reasonable further progress.32 Memorandum, the EPA determined, that are contemporaneous with the after a review of past regulatory project and otherwise creditable. A project that results in a significant interpretations and the existing Emissions increases and decreases are emissions increase in Step 1 and a regulations as whole, that the best contemporaneous if they occur between significant net emissions increase in reading of our regulations is that both ‘‘[t]he date 5 years before construction Step 2 of the NSR major modification increases and decreases in emissions on the particular change commences; applicability test is a major modification could be accounted for at Step 1 for all and [t]he date that the increase from a that requires a major NSR permit. three types of emissions units under C. Project Emissions Accounting their respective NSR major modification 25 Step 2, which is also known as applicability tests. However, contemporaneous netting, is voluntary and can add As we stated in the March 2018 recognizing the uncertainty described complexity to the NSR major modification Memorandum, in 2017 the EPA previously the proposal included applicability process in that it requires the additional accounting of all other increases and ‘‘identified certain elements of the NSR revised regulatory text to clarify the decreases in actual emissions that are regulations and associated EPA policies regulations that define the major contemporaneous to the project and creditable. This that have been sources of confusion and modification applicability test as it includes accounting of all creditable increases and uncertainty’’ for both permitting applies to projects involving multiple decreases in emissions over the five-year period 33 36 prior to the commence construction date for the authorities and stakeholders alike. types of emissions units. The project, regardless of whether those increases and One such element was ‘‘whether proposed regulatory textmade clear that decreases were associated with air permitting emissions decreases from a proposed emissions increases and decreases for actions for which records would be readily project at an existing major stationary projects that involve multiple types of available. It also requires that the source anticipate and include in the netting analysis any creditable source may be taken into account under emissions units can be considered in the increases or decreases in emissions that may occur Step 1 of the major modification same manner as emissions increases and after the commence construction date for the project applicability process in the EPA NSR decreases for projects that only involve and prior to the date the increase from the project 34 new units or only involve existing units is expected to occur, which can range from months regulations.’’ Thus, in the to years. 40 CFR 52.21(b)(3)(i)(b). In aggregate, this Memorandum, we communicated that in Step 1 of the NSR major modification accounting can span well over five years and after review of past regulatory applicability test. The regulatory text involve many emissions units at large, complex interpretations and the existing that governed this hybrid test prior to sources. Additionally, to be creditable, emissions the finalization of this rule said that ‘‘a decreases accounted for in Step 2 must, among regulations as whole, we interpret our other things, be enforceable as a practical matter at ‘‘current NSR regulations [to] provide significant emissions increase of a and after the time actual construction on the project that emissions decreases as well as regulated NSR pollutant is projected to being evaluated in Step 1 begins, which may increases are to be considered at Step 1 occur if the sum of the emissions require one or more additional permitting actions increases for each emissions unit, using to establish such enforceable emission limits. 40 of the NSR applicability process, CFR 52.21(b)(3)(vi)(b). If a project results in a provided they are part of a single the method specified in [40 CFR 52.21] 37 38 significant emissions increase in Step 1, a source (a)(2)(iv)(c) through (d) ... as may choose to forego the potentially complex and 28 40 CFR 52.21(b)(3)(ii). The contemporaneous applicable with respect to each emission cumbersome process of conducting a period could be different from a 5-year time period unit, for each type of emissions unit contemporaneous netting analysis and subject itself for states with approved State Implementation to major NSR permitting requirements after equals or exceeds the significant amount Plans. conducting the Step 1 analysis. 29 40 CFR 52.21(b)(3)(iii)(a). 35 26 40 CFR 52.21(b)(3). Id. 30 40 CFR 52.21(b)(3)(v). 36 27 This emissions increase is the aggregate 40 CFR 52.21(a)(2)(iv)(f). 31 increase in emissions from the project and, thus, it 40 CFR 52.21(b)(3)(vi). 37 Actual-to-projected-actual applicability test for includes any emissions increases and decreases 32 40 CFR 51.165(a)(1)(vi)(E)(3). projects that only involve existing emissions units. from the individual emissions units that are part of 33 March 2018 Memorandum at 1. 38 Actual-to-potential test for projects that only the project. 34 Id. involve construction of a new emissions unit(s).

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of that pollutant.’’ 39 Thus, in the pollutant emitted’’ that is contained in project were not considered in Step 1, proposal, we proposed to revise the this definition of ‘‘modification’’ in the regulations could subject a project to term ‘‘sum of the emissions increases’’ section 111 of the CAA 41 and as cross major NSR when the actual effect of that to ‘‘sum of the difference’’ to mirror the referenced in both Part C (PSD) and Part project would be to reduce emissions or text in 40 CFR 52.21(a)(2)(iv)(c) through D (NNSR) of Title I of the CAA.42 The result in a de minimis increase in (d) to help clarify that projects that United States Court of Appeals for the emissions, which would be contrary to involve multiple types of emissions District of Columbia Circuit (D.C. congressional intent for this program.49 units should treat the calculation of the Circuit) has recognized that the CAA ‘‘is The EPA sees little policy support for change in emissions from the project in silent on how to calculate such such an outcome. Allowing the Step 1 of the NSR major modification ‘increases’ in emissions.’’ 43 Thus, the consideration of both increases and applicability test in the same way as the question of how to determine whether a decreases in emissions in Step 1 allows calculations for projects that only physical change or change in the sources to undertake projects that may involve new units or only involve method of operation ‘‘increases’’ be environmentally beneficial overall existing units (i.e., considering both emissions is ambiguous.44 Accordingly, and that may be forgone if emissions emissions increases and decreases from because the statutory text does not itself decreases cannot be considered in Step the proposed project in Step 1). We also dictate how to determine whether a 1. Therefore, the EPA continues to proposed to clarify that the revised term physical change or change in the believe a two-step process—first ‘‘sum of the difference’’ would apply to method of operation ‘‘increases’’ determining the full scope of emissions ‘‘all emissions units’’ instead of ‘‘for emissions, under principles established changes, both increases and decreases, each emissions unit’’ to make clear that by the Supreme Court,45 the ‘‘EPA has from the project under consideration for projects that involve multiple types the authority to choose an and second, considering any increases of emissions units, the source owner or interpretation’’ of the term ‘‘increases’’ or decreases from other projects at the operator will first calculate the ‘‘sum of in ‘‘administering the NSR program and source that are contemporaneous and the difference’’ for each existing unit filling in the gaps left by Congress.’’ 46 creditable—is a reasonable and and ‘‘sum of the difference’’ for each And in choosing an interpretation of the allowable interpretation of the phrase new unit according to 40 CFR term ‘‘increases’’ in relation to the ‘‘increases the amount of any air 52.21(a)(2)(iv)(c) and (d) respectively, administration of the NSR program, pollutant emitted’’ within the definition and then, the owner or operator would ‘‘[t]here can be no doubt that the EPA of ‘‘modification.’’ proceed to add the ‘‘sum of the is entitled to balance environmental Furthermore, the EPA continues to difference’’ from (c) and (d) according to concerns with economic and believe this approach represents sound 40 CFR 52.21(a)(2)(iv)(f), the hybrid test. administrative concerns, at least to a policy to the extent it encourages In the proposal, we also added point.’’ 47 sources to undertake projects that may regulatory text to clarify that the term The EPA believes that allowing for result in emissions decreases that might ‘‘sum of the difference’’ as used in the consideration of both emissions not otherwise occur or could be referenced subparagraphs shall include increases and decreases from a project is delayed. As stated in the proposal both increases and decreases in consistent with congressional intent for preamble, various sources have emissions as calculated in accordance the PSD and NNSR preconstruction indicated to the EPA that they have with those subparagraphs. permitting programs to cover existing either significantly delayed or sources only when they undertake abandoned altogether projects that D. Legal Analysis and Policy Rationale projects which result in a non-de could have resulted in overall emissions In the March 2018 Memorandum, we minimis increase in emissions.48 If the decreases 50 given the complexities that explained that ‘‘the CAA contains no full scope of emissions changes from a Step 2 contemporaneous netting can statutory definition of the term ‘‘major modification.’’ The CAA does, however, 41 42 U.S.C. 7411(a)(4). 49 Emissions decreases may also be accounted for define the term ‘‘modification’’ as ‘‘any 42 42 U.S.C. 7479(2)(C); 42 U.S.C.7501(4). in Step 2; however, the text in the NSR regulations physical change in, or change in the 43 New York v. EPA, 413 F.3d 3, 22 (D.C. Cir. reads that such decreases are ones ‘‘other’’ than 2005) (New York I). those associated with the project being evaluated in method of operation of, a stationary Step 1. 40 CFR 52.21(b)(3)(i)(b). Emissions 44 New York v. EPA, 443 F.3d 880, 888–89 (D.C. source which increases the amount of decreases may also be accounted for in Step 2. Cir. 2006) (New York II) (‘‘Congress’s use of the However, if the source has had other creditable any air pollutant emitted by such source word ‘increases’ necessitated further definition emissions increases that are contemporaneous with or which results in the emission of any regarding rate and measurement for the term to the project and must be accounted for at Step 2, the 40 have any contextual meaning.’’). air pollutant not previously emitted.’’ effect of these creditable emissions increases may 45 The major NSR applicability regulations Chevron U.S.A. v. Natural Resources Defense be larger than the emissions decreases from the Council, 467 U.S. 837, 843 (1984) (Where the project. In this way, without project emissions discussed previously reflect an ‘‘statute is silent or ambiguous with respect to the interpretation of the statutory phrase accounting, a project that by itself results in a de specific issue, the question for the court is whether minimis increase or even an overall emissions ‘‘increases the amount of any air the agency’s answer is based on a permissible decrease could be subject to major NSR when construction of the statute.’’) emissions increases from other projects are 46 39 40 CFR 52.21(a)(2)(iv)(f) (2019). New York I v. EPA, 413 F.3d at 23, 24. considered in Step 2. 47 40 March 2018 Memorandum at 3. 42 U.S.C. Id. at 23. 50 For example, National Mining Association 7411(a)(4); CAA section 111(a)(4). This definition of 48 Alabama Power v. Costle, 636 F.2d 323, 401 Response to Request for Comments on Regulations ‘‘modification,’’ originally enacted by Congress in (D.C. Cir. 1979) (‘‘Congress wished to apply the Appropriate for Repeal, Replacement, or 1970 as part of the New Source Performance permit process, then, only where industrial changes Modification Pursuant to Executive Order 13777, 82 Standards (NSPS) program, was incorporated by might increase pollution in an area, not where an FR 17793, April 13, 2017, at 3–4, EPA–HQ–2017– reference for purposes of the newly enacted PSD existing plant changed its operations in ways that 0190–37770; Testimony of Paul Noe for American and nonattainment programs by the Clean Air Act produced no pollution increase.’’); Id. at 360 Forest & Paper Association (AF&PA) and American Amendments of 1977. 42 U.S.C. 7479; CAA section (‘‘Categorical exemptions may also be permissible Wood Council (AWC), House Energy & Commerce 169(1)(C) (‘‘The term ‘construction’ when used in as an exercise of agency power, inherent in most Committee, Subcommittee on Environment, and connection with any source or facility includes the statutory schemes, to overlook circumstances that Climate Change, Oversight Hearing on ‘‘New Source modification (as defined in section 7411(a) of this in context may fairly be considered de minimis. It Review Permitting Challenges for Manufacturing title) of any source or facility.’’); 42 U.S.C. 7501(4); is commonplace, of course, that the law does not and Infrastructure,’’ at 2, 5, 7–8, February 14, 2018; CAA section 171(4) (‘‘The terms ‘modifications’ and concern itself with trifling matters, and this AF&PA and AWC April 25, 2019, Executive Order ‘modified’ mean the same as the term ‘modification’ principle has often found application in the 12866 meeting materials (EPA–HQ–OAR–2018– as used in section 7411(a)(4) of this title.’’). administrative context.’’). 0048).

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entail, and given past EPA statements 51 emissions. Application of this policy addresses the most significant that emissions decreases could not be may assist sources that are responsible comments received. accounted for in Step 1. Several for determining the scope of a project to 2. Revisions to Step 1 of the NSR Major commenters on the proposal also make that determination and avoid the Modification Applicability Test provided descriptions of actual projects over aggregation or under aggregation of that produced both increases and activities that could subsequently be As we explained in Section II.C. of decreases in emissions to illustrate the considered an effort to circumvent the this final rule preamble, the EPA types of projects that may result in NSR program. As discussed in the 2018 proposed to revise a portion of the major overall emissions decreases in Step 1 of final action on project aggregation, the NSR major modification applicability the NSR major modification ‘‘substantially related’’ test in the regulations to provide needed clarity applicability test.52 project aggregation interpretation and over whether project emissions accounting is allowed for all project III. Final Action policy calls for sources to aggregate emissions from nominally separate categories, including projects that A. Summary of Final Action activities when there is an apparent involve multiple types of emissions units. Specifically, the EPA proposed to In this action, we are finalizing the technical or economical interconnection revise the text ‘‘sum of the emissions proposed clarifications to the Step 1 between those activities. This 2018 final increase’’ in 40 CFR 52.21(a)(2)(iv)(f) to provisions of the major modification action on project aggregation also ‘‘sum of the difference,’’ as reflected in applicability test at 40 CFR includes a rebuttable presumption that subparagraphs 40 CFR 52.21(a)(2)(iv).53 More specifically, we activities that occur outside a 3-year 52.21(a)(2)(iv)(c)–(d), the applicability are finalizing minor revisions to the period are not related and should not be test that applies to only existing units or regulations that apply to projects that grouped into one project. only new units respectively, to clarify involve multiple types of emissions Furthermore, the EPA is concluding that both emissions increases and units 54 to state that both emissions that the provisions at 40 CFR 52.21(r)(6) decreases in emissions resulting from a increases and decreases can be are adequate to ensure sufficient proposed project can be considered in considered in Step 1 of the NSR major monitoring, recordkeeping and Step 1 of the NSR major modification modification applicability test in the reporting of emissions for projects determined not to trigger major NSR, applicability test. same manner as they are considered for We also proposed to clarify that the after considering both emissions projects that only involve existing revised term ‘‘sum of the difference’’ 55 increases and decreases from the project emissions units or only involve new would apply to ‘‘all emissions units’’ 56 in Step 1 of the NSR major modification emissions units. These minor instead of ‘‘for each emissions unit’’ to applicability test. These requirements revisions include, but are not limited to, make clear that for projects that involve apply when there is a ‘‘reasonable changing the term ‘‘sum of the multiple types of emissions units, the possibility’’ that the project could still emissions increase’’ to ‘‘sum of the source owner or operator will first result in a significant emissions difference’’ in the context of the hybrid calculate the ‘‘sum of the difference’’ for increase. Lastly, the EPA is not making test that applies to multiple types of each existing unit and ‘‘sum of the the regulatory changes in this final rule emissions units and adding a provision difference’’ for each new unit according that specifies that the term ‘‘sum of the mandatory for adoption by state and to 40 CFR 52.21(a)(2)(iv)(c) and (d) difference’’ as used for all types of units local air agencies with approved major respectively, and then, the owner or (new, existing and the combination of NSR programs. Thus, state and local air operator would proceed to add the ‘‘sum new and existing units) shall include agencies can adopt these changes at of the difference’’ from (c) and (d) both increases and decreases in their discretion. according to 40 CFR 52.21(a)(2)(iv)(f), emissions as calculated in accordance B. Comments Received and Basis for the hybrid test. with those subparagraphs. Final Action In addition, the EPA proposed to add The EPA is also concluding that it is to the regulation a provision that appropriate to apply its ‘‘project 1. General Comments on the Proposal specifies that the term ‘‘sum of the aggregation’’ interpretation and policy, The EPA received approximately 36 difference,’’ as used in the referenced set forth in the 2018 final action that detailed comments 58 on the project subparagraphs, shall include both completed reconsideration of a 2009 emissions accounting proposal, which increases and decreases in emissions as action on this topic (‘‘the 2018 final included comments from industry and calculated in accordance with those action on project aggregation’’),57 to industry associations, state and local air subparagraphs. With these proposed Step 1 of the NSR major modification agencies, other governmental agencies, revisions, we believe the regulations applicability test for projects that environmental advocacy groups, and a make clear that accounting for involve both increases and decreases in policy advocacy group. The EPA also emissions decreases in Step 1 of the received several comments from major modification applicability test is 51 84 FR 39244, at 39247–39248 (August 9, 2019). The proposal preamble includes a full description individuals and more than 600 allowed for all projects, including of these past statements. comments on the proposed rule from a projects that involve multiple types of 52 For example, see comments in the regulatory mass mailer campaign. emissions units. docket for this action at EPA–HQ–OAR–2018– The EPA’s responses to these Several commenters supported the 0048–0056, EPA–HQ–OAR–2018–0048–0072 and comments are provided in a separate proposal’s premise of revising the EPA–HQ–OAR–2018–0048–0077. 53 Supra n.03. Response to Comments (RTC) document regulatory text to provide clarity that 54 40 CFR 52.21(a)(2)(iv)(f). included in the docket for this final both emissions increases and decreases 55 40 CFR 52.21(a)(2)(iv)(c). action. This final rule preamble can be considered in Step 1 of the NSR 56 40 CFR 52.21(a)(2)(iv)(d). major modification applicability test for 57 83 FR 57324 (November 15, 2018). The EPA 58 A few of the comments received include projects that involve multiple types of notes, however, that state and local air agencies comments from separate entities that joined efforts emissions units. A few of these with approved SIPs are and were not required to to provide comments on the proposal for this final amend their plans to adopt the interpretation that action and thus more than 36 associations, commenters also supported the specific projects should be aggregated when ‘‘substantially government agencies, groups or industry regulatory text revisions proposed. The related.’’ representatives commented on the proposal. commenters stated that the proposal, if

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finalized, would improve and rule does not directly pertain to or projects that avoid major NSR because streamline the permitting process, impact acid rain production in the they include emission decreases in their provide for the timely issuance of Adirondacks. Second, we do not have a calculation of the proposed project’s permits, and spark economic growth, reason to believe that the clarifications emissions in Step 1 would not while still protecting the environment to the NSR regulations reflected in this necessarily otherwise trigger major NSR because sources would be more likely to rule will lead to significant and overall because they may not result in a undertake projects that would reduce emissions increases as a result of significant net emissions increase in emissions if those projects were not construction at stationary sources. Step 2. Furthermore, the EPA has been subject to the NSR major modification Projects that cause emissions increases told by stakeholders that some projects requirements. are already not subject to major NSR may not even move forward if the The EPA agrees with the commenters requirements if the increases in applicant cannot include emissions who believe that the revisions being emissions are below the SERs, with or decreases in its calculation of the finalized in this rule will add clarity to without considering the associated proposed’ project emissions in Step 1. Step 1 of the NSR major modification emissions decreases in Step 1 of the However, quantifying the applicability test and provide a more NSR major modification applicability environmental impacts of this rule, as accurate accounting of a project’s actual test. Nothing in this rule alters those with any NSR rule, is difficult because emissions impact. This clarity and requirements. For many projects, when NSR permitting actions are case-by-case accuracy could potentially incentivize considering both emission increases and determinations that vary based on the energy efficiency and/or other decreases in Step 1, the project will characteristics of the source of environmentally beneficial projects, likely not result in a significant emissions (e.g., location, magnitude of thereby furthering the Congressional emissions and stack heights), the emissions increase and should be purpose of the NSR program which is to attainment status of the area, and many treated as de minimis. This rule is only ensure environmental protection while other characteristics, including business a clarification of our existing regulations allowing for economic growth.59 We decisions on whether to proceed with a regarding how to conduct projections of also agree with the commenters who particular project at a certain point in project emissions changes by including supported the specific regulatory text time. The EPA does not have sufficient revisions we proposed that were emissions increases and decreases in permitting data to make this mentioned previously. this projection as part of Step 1 of the quantification and even if the EPA were On the other hand, several NSR major modification applicability to request that information through an commenters argued that, by allowing test for projects that involve multiple Information Collection Request for the sources to take credit for emissions types of emissions units to make those entire United States or a subset of states, decreases from a project in Step 1, requirements consistent with the the permit application data do not facilities may be able to avoid major applicability test for projects that only include information on many important NSR permitting requirements including involve new units or only involve considerations including, for example, the installation of controls based upon existing units. Those clarifications are the records of any business decisions on BACT or LAER determinations, leading based on a logical reading of the statute whether to proceed with a particular to an increase in emissions. The and consistent with the congressional project. We also do not have access to, commenters stated that the proposed intent for the NSR program, which is to nor do we require, reporting of any rule, if adopted, would potentially ensure environmental protection while information regarding decisions made reverse air quality gains that have been allowing for economic growth. Finally, for projects that were not pursued. accomplished over the last few decades, even though certain projects may not be Thus, to address this information gap, thereby increasing the likelihood of subject to the NSR major modification the EPA requested in its August 2019 adverse impacts to human health and requirements, they may still be subject proposal any examples of the emissions the environment. These commenters to the applicable minor NSR program and cost impacts of considering both urged the EPA to withdraw the permitting requirements. emissions increases and decreases in proposed rule and one commenter also These commenters did not provide Step 1 of the NSR major modification urged the EPA to withdraw the March information that demonstrates that it applicability test. Several commenters 13, 2018 Memorandum on the same would always be more environmentally answered that information request by subject. beneficial for each project potentially providing descriptions of projects that These comments were echoed by the affected by this rule to proceed through produced both increases and decreases mass mailer campaign commenters who the major NSR permitting process and in emissions to illustrate the types of added that the proposed rule would thereby become subject to the applicable projects that may result in overall have the effect of allowing sources to NSR permitting requirements, including emissions decreases in Step 1 of the increase emissions without control the installation of BACT or LAER air NSR major modification applicability requirements, thereby enabling coal- pollution control technology. There may test.61 Two other commenters provided fired power plants to operate longer and be environmental benefits from allowing examples highlighting how finalizing emit more pollution, reversing the a source to consider decreases in Step this action would achieve emissions progress that has been achieved in 1 and, therefore, not trigger major NSR reductions while also reducing the NSR reducing acid rain in the Adirondacks. based on a more accurate accounting of regulatory burden in the electric utility The EPA respectfully disagrees with the emissions from the project. By sector.62 Others provided various these commenters, including the mass clarifying that decreases may be comments that suggest that this rule mailer campaign commenters. First, this considered in Step 1, the rule provides an incentive for sources to design their be as stringent or more stringent than the BACT or 59 Wisconsin Elec. Power Co. v. Reilly, 893 F.2d projects to include emissions decreases LAER requirements. 61 These comments can be found in Section 4.0 901, 909–10 (7th Cir. 1990). (‘‘[The] PSD program 60 ‘‘represented a balance between ‘the economic and pollution controls. In addition, of the Response to Comments document for this interests in permitting capital improvements to action. continue and the environmental interest in 60 By allowing decreases in Step 1, we are 62 These comments can be found in Section 5.0 improving air quality.’ (quoting Chevron, 467 U.S. incentivizing sources to design their projects to of the Response to Comments document for this at 851)). include emissions decreases and controls that may action.

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may promote emissions reductions by definition of ‘‘modification.’’ 63 This emissions accounting would create an encouraging industry to seek emissions definition is cross referenced in both exemption from NSR such that not reduction opportunities in their Part C (PSD) and Part D (NNSR) of Title every physical change or change in planning processes that they might I of the CAA.64 The D.C. Circuit has method of operation would be otherwise forego if they were subject to recognized that the CAA ‘‘is silent on considered in the NSR major the major NSR program. However, the how to calculate such ‘increases’ in modification applicability information provided did not fill all the emissions.’’ 65 Thus, the question of determination. These commenters cited data gaps (as explained previously, how to determine whether a physical to a D.C. Circuit decision 70 to argue that these include emissions characteristics, change or change in method of ‘‘any’’ in the statutory phrase ‘‘increases cost impacts, business decisions on operation ‘‘increases’’ emissions is the amount of any air pollutant emitted’’ whether to proceed with a particular ambiguous.66 Accordingly, because the contained in the definition of project, etc.), and it also did not show statutory text does not itself dictate how ‘‘modification means ‘‘any’’ and the that consideration of emissions to determine whether a physical change EPA was creating a ‘‘project decreases in Step 1 would necessarily or change in the method of operation exemption,’’ similar to the equipment result in more emissions than would be ‘‘increases’’ emissions, under principles replacement rule deemed unlawful in allowed if major NSR requirements are established by the Supreme Court,67 the that D.C. Circuit decision, by allowing triggered based on emissions increases ‘‘EPA has the authority to choose an the source to include unrelated alone. interpretation’’ of the term ‘‘increases’’ decreases in Step 1 to ensure a project in ‘‘administering the NSR program and did not result in a significant emissions In the face of this uncertainty over filling in the gaps left by Congress.’’ 68 increase.71 whether the clarification reflected in And in choosing an interpretation of the The EPA does not agree that the this rule will increase emissions from term ‘‘increases’’ in relation to the proposal was intended to create a construction at stationary source of air administration of the NSR program,’’, ‘‘project exemption’’ because, unlike the pollution, we have placed greater ‘‘[t]here can be no doubt that [the] EPA equipment replacement rule found to be importance on ensuring that the NSR is entitled to balance environmental unlawful in that decision, this rule regulations are clear, logical, and concerns with economic and merely clarifies pre-existing consistent with Congressional intent. As administrative concerns, at least to a applicability requirements and does not explained in greater detail in Section point.’’ 69 provide an exemption from major NSR. III.B.3. of this final rule’s preamble and After reviewing comments received This rule simply conforms the in the Response to Comments document on the proposal, the EPA continues to regulatory text for projects that involve for this action, the EPA views allowing believe that when determining whether multiple types of emissions units with for project emissions accounting to be a physical change or change in the the regulatory text that applies to more consistent with the requirement in method of operation ‘‘increases’’ projects that only involve new units or the Act that a physical change or change emissions, allowing for project that only involve existing units, and in the method of operation at an existing emissions accounting at Step 1 of the also expressly articulates a meaning of major stationary source is subject to NSR major modification applicability the term ‘‘sum of the difference’’ that is major NSR if it results in a significant test is more consistent with the Clean inherent in the phrase. The EPA has increase in emissions. If project Air Act, the 2002 NSR Reform Rule, and already applied a similar approach emissions accounting were not allowed, the statutory purpose of the NSR following the March 2018 a project that does not result in an program. Not allowing for project Memorandum, and this final rule overall significant increase in emissions emissions accounting could lead to a merely clarifies the regulations. or that actually decreases emissions into project that actually results in a The EPA also disagrees with the ambient air could be subject to NSR. decrease in emissions being subject to commenters that argue that this rule The EPA believes that allowing for the the major NSR permitting requirements. precludes consideration of ‘‘any’’ consideration of the full effect of a The EPA believes this would undermine physical change or change in method of project, including any associated the congressional intent of the NSR operation under the NSR major decreases, is consistent with the 2002 program of ensuring environmental modification applicability test. NSR Reform Rule and more faithfully protection while allowing for economic Although we proposed that taking implements the intent of Congress for growth because projects that, in total, account of emissions decreases at Step the NSR programs, which is to ensure would result in insignificant emissions 1 did not present any reasonable environmental protection while increases or overall emissions concerns regarding NSR allowing for economic growth. That is reductions might be delayed or foregone circumvention 72 under the EPA’s because projects that, in total, would due to the potential complexities of result in insignificant emissions undergoing a Step 2 contemporaneous 70 New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006) increases or overall emissions (New York II). netting process or the time and expense 71 New York II, 443 F.3d at 887–8 (by using the reductions might be delayed or foregone of major NSR permitting. The EPA word expansive word ‘‘any’’ in describing the due to the potential complexities of explains this conclusion in more detail emissions-increasing changes that qualify as a undergoing a Step 2 major modification in the Response to Comments document ‘‘modification’’ under Clean Air Act section applicability process or requiring a for this final action. 111(a)(4), Congress precluded the EPA from major NSR permit. excluding some such changes from NSR). Several commenters objected to the 72 84 FR 39244, at 39251 (August 9, 2019). (‘‘We 3. Legal Rationale proposal, however, claiming that project do not believe it is necessary to adopt the same criteria that apply for separation of activities (i.e., As noted in Background Section II.D. 63 Supra n.41. under aggregation) to the grouping of activities, by 64 Supra n.42. considering such grouping to potentially constitute of this rule’s preamble, the major NSR ‘‘over aggregation’’ that, in turn, may constitute 65 Supra n.43. applicability regulations reflect an NSR circumvention. The circumvention policy 66 Supra n.44. interpretation of the statutory phrase speaks to the situation where a source carves up 67 Supra n.45. what is plainly a single project into multiple ‘‘increases the amount of any air 68 Supra n.46. projects, where each of those separate projects may pollutant emitted’’ contained in the 69 Supra n.47. Continued

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project aggregation policy,73 the EPA to determine the scope of a project, requirements to help enforcement recognizes that certain aspects of the sources should only aggregate emissions authorities hold sources accountable for proposal could have led to the changes when there is an apparent their projections when there is a conclusion that the proposed rule technical or economical interconnection reasonable possibility the project could change would allow sources to attempt between the physical and operational trigger major NSR. In addition, the NSR to avoid NSR by allowing sources to changes. In addition, sources should regulations provide that ‘‘[r]egardless of include unrelated emissions decreases include in a common project in Step 1 any such preconstruction projections, a as part of the project under all activities (and only those activities) major modification results if the project consideration. Thus, in response to the that meet this ‘‘substantially related’’ causes a significant emissions increase concerns raised by these and other test. and a significant net emissions commenters, the EPA has determined it Commenters also argued that the EPA increase.’’ 75 Therefore, while the EPA is is appropriate to limit the scope of had unlawfully not required that not requiring projections to be emissions decreases that can be emissions decreases be enforceable at Step 1 regardless of considered at Step 1 to only the project contemporaneous or enforceable in Step whether the source owner or operator under review and to not allow sources 1 of the NSR major modification projected increases or decreases in to attempt to avoid NSR by expanding applicability test. However, the EPA emissions, the NSR regulations do the scope of decreases to those that are believes that any emission decreases provide for an overall enforceable not truly part of the project. As considered in Step 1 are and will need limitation on actual emission increases. discussed in more detail in Section to be contemporaneous because, the If any emissions decreases are III.B.4 of this preamble, the EPA has ‘‘substantially related’’ test has a overstated, or any increases understated, concluded that it is appropriate to apply temporal component and, as discussed the source may be subject to liability if its project aggregation policy to both more in Section III.B.4 of this preamble its actual emissions due to the project emissions increases and decreases to and in the Response to Comments exceed de minimis thresholds. determine the scope of the project in document for this final action, the Moreover, the EPA anticipates that even Step 1 of the NSR applicability analysis. decreases must be part of the same if, in accounting for the full impact of Many of the commenters’ concerns project. a project at Step 1, a source would not regarding the review of ‘‘any’’ physical Regarding the comments that be required to obtain a major NSR change or change in method of emissions decreases are required to be permit, the vast majority of these operation can be addressed by rationally enforceable,74 the commenters correctly projects would still be required to defining the scope of a project, pointed to the requirement regarding the obtain a minor NSR permit under the consistent with this policy. The enforceability of Step 2 state minor NSR permit program and the application of the ‘‘substantially- contemporaneous emissions decreases EPA anticipates that the emissions related’’ test of the 2018 final action on and the EPA is not changing those decrease(s) from the project would be project aggregation should be sufficient requirements as part of the rule. documented in the permit record. to prevent sources from arbitrarily However, Step 2 contemporaneous The EPA does not believe the policy grouping activities for the sole purpose netting is a distinct idea from project rationale that the commenters provided of avoiding the NSR major modification emissions accounting and parallel for wanting the EPA to require that requirements through project emissions requirements are not necessarily decreases in Step 1 be enforceable accounting. That is because when warranted when the context is outweighs the EPA’s policy rationale for applying the ‘‘substantially related’’ test considered. Where a source is using not requiring projected actual emissions emissions reductions from another increases from a project to be result in emissions increases below the significance project within a 5-year enforceable and for treating emission threshold but which, if considered collectively as contemporaneous period to ‘‘net out’’ of decreases and increases in the same one project, would result in an emissions increase major NSR permitting, it is important manner when calculating the proposed above the threshold. Separate activities that, when that decreases in emissions from project emissions in Step 1.76 As such, considered together, either decrease emissions or result in an increase that is not significant are not another project that are used for this the EPA is not finalizing, as part of this in view in the EPA’s circumvention policy.’’) purpose be enforceable to ensure that action, a requirement that emissions 73 84 FR 39244, at 39250 (August 9, 2019). As the reduction is real and permanent. increases or decreases be enforceable in explained in more detail in the proposal preamble This is because a project that would Step 1 unless required by the applicable for this action, the 2018 final action on project result in a significant emissions increase 77 aggregation describes the procedure (i.e., the regulations. As the EPA explained in ‘‘substantially related’’ test or ‘‘circumvention is avoiding major NSR due to unrelated the proposal, the EPA intends to treat policy’’) ‘‘for determining the circumstances under changes made at the facility. Project projected actual emissions used in which nominally separate activities should emissions accounting does not allow calculating emissions decreases from a reasonably be considered to be a single project.’’ emissions reductions from another More specifically, the policy calls ‘‘for sources and project in the same manner as it does reviewing authorities to aggregate emissions from project to be used to avoid major NSR emissions increases since they are both nominally-separate activities when they are in this way. Rather, project emissions part of the same project. Emission ‘‘substantially related.’’ For a project to be accounting is part of the process for decreases should be considered simply substantially related, the ‘‘interrelationship and projecting the actual emissions change part of the projected emissions for the interdependence of the activities [is expected], such that substantially related activities are likely to be at a facility resulting from a single jointly planned (i.e., part of the same capital project. In this distinct context, the EPA 75 40 CFR 52.21(a)(2)(iv)(b). improvement project or engineering study), and decided in 2002 against requiring that 76 84 FR 39244, at 39251 (August 9, 2019). (‘‘[T]he occur close in time and at components that are such a projection be enforceable. EPA currently believes that ‘the same reasoning that functionally interconnected.’’ In addition, the final underpinned the 2002 NSR Reform Rule’s treatment ‘‘project aggregation’’ action adds that in general Instead, the EPA established of projected actual increases applies equally to ‘‘[to] be ‘substantially related,’ there should be an recordkeeping and reporting projected emissions decreases at Step 1.’’). apparent interconnection—either technically or 77 For new emissions units (including any units economically—between the physical and/or 74 In this context, the term enforceable is intended that have been in operation for less than two years), operational changes, or a complementary to mean that the projections of a decrease in actual any emissions increases and decreases would be relationship whereby a change at a plant may exist emissions for an existing emissions unit need to be enforceable because the applicability test for new and operate independently, however its benefit is enforceable as a practical matter (e.g., accompanied units is the actual-to-potential test. 40 CFR significantly reduced without the other activity.’’ by an emission limit). 52.21(a)(2)(iv)(d); id. 52.21(b)(4); id. 52.21(b)(7).

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project, not some discrete change from cases result in the source later preconstruction projections, a major the project subject to different or retroactively becoming subject to major modification results if the project causes additional requirements. A lower NSR requirements.83 The EPA believes a significant emissions increase and a projected emission increase at an such an outcome would be significant net emissions increase.’’ 84 existing emissions unit involved in a unacceptable. Therefore, there is an inherent project can have the same numerical Another commenter added that the enforceable limitation on increases of effect on the result of the Step 1 inclusion of emissions decreases in Step actual emissions. applicability calculation by itself as a 1 in the NSR major modification Finally, an additional commenter projected increase combined with a applicability calculation must be asserted that the agency’s proposal projected emissions decrease at another enforceable, otherwise it would render foregoes statutorily specified benefits— unit that is involved in the project. Step 2 of the analysis meaningless. The avoidance of air quality violations, Therefore, we see no reason why commenter asserted that this rule would improved pollution-control enforceability of projected actual produce an absurd result by eviscerating technologies, offsetting emission emissions should be required in one Step 2’s prohibition against crediting reductions—in a fashion that is instance and not the other. Thus, the unenforceable emissions decreases for incompatible with any lawful exercise reasoning the EPA applied when the purposes of netting out of NSR of de minimis discretion. This declining to require that projected requirements. contention is countered by other The EPA disagrees that allowing for actual emissions be made enforceable as commenters, however, who stated that the consideration of emission decreases part of the 2002 NSR Reform rule this final rule is not an exemption from as part of the projected actual emissions continues to apply to projected actual NSR applicability and is instead a from the project in Step 1 would render clarification of pre-existing regulatory emissions that are derived by combining the contemporaneous netting provisions text specifying how NSR applicability is increases and decreases from the same of the regulations superfluous or lead to to be determined for projects that project in accordance with the absurd results. Allowing emissions involve multiple types of emissions clarification reflected in this rule.78 As decreases from the project under review units. we explain in more detail in Section to be considered in Step 1 does not We agree with the latter commenters. III.B 4 of this preamble, requiring that mean that Step 2 is superfluous. Step 1 The clarification reflected in this rule is projected actual emissions decreases be is limited to emissions increases and not based on inherent de minimis enforceable in Step 1 could effectively decreases from the same project. The exemption authority and does not alter replace the actual-to-projected-actual 79 source could still only account for the EPA’s determination of the level of applicability test for existing units with emissions decreases from another emissions that is significant for any an actual-to-potential test,80 or, more project within the contemporaneous pollutant. As stated previously, each accurately, an actual-to-allowable test,81 period in Step 2, subject to the other physical change or change in method of which would directly conflict with the limitations of contemporaneous netting. operation must still be compared to the EPA’s reasoning for adopting the actual- In addition, the ‘‘substantially related’’ significance levels to determine whether to-projected-actual applicability test in test mentioned previously, and further or not the change results in an 2002. Among other reasons, limiting explained in Section III.B.4. of this emissions increase that is de minimis. projected actual emissions to allowable preamble, applies to prevent aggregating All this rule does is clarify that, in emissions (even if only for emissions into a single project those activities that projecting whether a project will result decreases) could confiscate unused do not represent such project, so in a non-de minimis increase in actual capacity of the source 82 and in some decreases from activities that do not emissions, the source can quantify such meet this test should not be considered an increase based on the full scope of 78 67 FR 80185, at 80204 (December 31, 2002). In in Step 1. Therefore, Step 2 is not the project, including any portions of the 2002 NSR Reform rule, the EPA expressly declined to adopt a requirement under which a superfluous because it clearly still the project that are projected to decrease source’s projected actual emissions would have serves a purpose of considering actual emissions. The EPA believes that become an enforceable emission limitation because: emissions increases and decreases from allowing a source to conduct projections (1) ‘‘we are concerned that such a requirement may other projects that are contemporaneous of actual emissions in Step 1 for the full place an unmanageable resource burden on with the proposed project and otherwise reviewing authorities,’’ and (2) ‘‘we also believe that scope of the project, including any it is not necessary to make . . . future projections creditable. As discussed previously, if decreases in emissions caused by the enforceable in order to adequately enforce the major decreases from the project could not be project, is the best reading of CAA NSR requirements. The Act provides ample considered in Step 1, that could section 111(a)(4) because it will ensure authority to enforce the major NSR requirements if potentially subject a project that . . . [a] physical or operational change results in a that projects that overall decrease significant net emissions increase at . . . [a] major decreases emissions overall to the major emissions or result in a de minimis stationary source.’’ NSR permitting requirements. In increase in emissions will not be subject 79 The actual-to-projected-actual applicability test addition, as noted previously, while the to the major NSR program. for projects that only involve existing emissions EPA is not requiring projections of units is the test defined in 40 CFR 52.21(a)(2)(iv)(c). decreases at Step 1 to be enforceable, 4. Defining the Scope of a Project 80 The actual-to-potential test for projects that only involve new emission units is the test defined the major NSR regulations contain a In the proposal, we said that defining in 40 CFR 52.21(a)(2)(iv)(d). provision that ‘‘[r]egardless of any such the scope of the project was within the 81 This is because under the approach requiring discretion of the source. We also enforceability of emissions decreases, the projected method of operation subject to NSR applicability. indicated that when a source is defining actual emissions for an emissions unit would 40 CFR 52.21(b)(2)(iii)(f). the scope of the project: (1) Separating become the allowable emissions for that unit. The 83 This is the opposite of the confiscation of activities into smaller projects (i.e., definition of allowable emissions can be found at unused capacity: if such an allowable emissions 40 CFR 52.21(b)(16). limitation was required and is subsequently relaxed under aggregation) to circumvent the 82 For example, if a source was required to to accommodate an unrelated increase in NSR major modifications permitting establish an enforceable emission limit to consider production rate or hours of operation, and that requirements could be prevented by a decrease that is the result of the project, the relaxation resulted in the modification becoming source may not be able to later increase production major, the source could become subject to major applying the interpretation and policy or hours of operation, which would otherwise not NSR requirements as if construction had not yet even be considered a physical change or change in commenced. 40 CFR 52.21(r)(4). 84 40 CFR 52.21(a)(2)(iv)(b).

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set forth in the 2018 final action on contemporaneous emission reductions a temporary reduction, thus avoiding project aggregation and (2) adding within the facility and considering them the need to even modify equipment or multiple activities into bigger projects to be part of the project, while not install a pollution control device. A (i.e., over aggregation) was not incorporating similar contemporaneous commenter added that some courts have precluded by any prior interpretation or emission increases in the scope of the imposed a statute of limitations that policy.85 On this latter point, we added project. runs 5 years from the date of the that separate activities which, when The EPA does not concur with the modification and that the proposal, in considered together, either decrease commenters who stated that conjunction with those rulings, invited emissions or result in an increase that circumvention of the NSR permitting a source to claim unenforceable is not significant were not previously requirements is a likely outcome of the decreases to avoid NSR, then simply considered as part of the EPA’s proposed rule because, while not avoid following through once the circumvention policy. However, we previously contemplated by our project limitations period has passed. requested comment on whether we aggregation policy, the EPA has should instead apply the ‘‘substantially concluded after review of the comments We disagree with these commenters. related’’ criteria to prevent over- received on the proposal for this action The decrease in emissions in Step 1 will aggregation in Step 1 and asked what that the ‘‘substantially related’’ test from be calculated in most cases using the the impact of applying such a standard our 2018 final action on project actual-to-projected-actual applicability would be.86 aggregation interpretation and policy test, and the projected actual emissions Multiple commenters expressed provides the appropriate basis for calculation in that test must be based on support for the proposed concept that sources to determine the scope of a consideration of all relevant the scope of a project be at the project in Step 1 of the NSR information.90 If there is a ‘‘reasonable discretion of the source and that the applicability analysis. We believe that possibility’’ that the project may result absence of a provision defining the applying the 2018 final action on project in a significant emissions increase, as scope of a project does not create an aggregation interpretation and policy in defined in the regulations at 40 CFR incentive to over-aggregate.87 this context alleviates concerns about 52.21(r)(6), the source must meet Commenters supported this proposed potential NSR circumvention in Step 1 applicable pre- and post-project concept on the grounds that this of the NSR major modification recordkeeping, monitoring, and discretion would allow sources to applicability test. The ‘‘substantially reporting requirements that apply for 5 undertake activities that would reduce related’’ test, which is reflected in the or 10 years following the resumption of overall emissions in cases where a 2018 final action on project aggregation, regular operation after the project, project is comprised of multiple calls for sources to aggregate emissions depending on the nature of the project. emissions units. from nominally separate activities when As such, the ‘‘reasonable possibility’’ Several commenters, however, there is an apparent technical or provisions would provide the records expressed concerns that the scope of a economical interconnection between the necessary for reviewing authorities to project to which project emissions physical and operational changes. This ensure that the emissions reductions are accounting is applied should be 2018 final action on project aggregation not temporary and provide for 88 defined. Otherwise, any ambiguity in also includes a policy of applying a enforcement of the major NSR program defining the scope of the project would rebuttable presumption that project requirements, as necessary. The EPA constrain a reviewing authority’s ability activities that occur outside a 3-year also believes that the regulatory text at to verify whether the source has period are not related and should not be 40 CFR 52.21(a)(2)(iv)(b) that states, reasonably exercised its discretion in grouped into one project. The EPA has ‘‘[r]egardless of any such applying project emissions accounting observed that ‘‘[w]hen activities are preconstruction projections, a major to a project. Other commenters added undertaken three or more years apart, modification results if the project causes that the lack of criteria for determining there is less of a basis that they have a a significant emissions increase and a the scope of a project would allow substantial technical or economic significant net emissions increase’’ sources to circumvent NSR relationship because the activities are provides a safeguard that will ensure requirements by selectively considering typically part of entirely different that the emissions reductions are not emissions decreases with unrelated and planning and capital funding cycles.’’ 89 temporary or illusory. If a source, upon non-contemporaneous increases. To this Under this 2018 final action on point, commenters expressed concern project aggregation interpretation and resuming regular operation after a that, under the proposed rule, sources policy, sources continue to have project, fails to realize a reduction in would be able to circumvent NSR discretion in defining the scope of the emissions that was projected from a requirements by finding project based on their business needs, particular unit, or if that reduction is but at the same time should not less than was projected, such that the 85 As stated previously, the term ‘‘project’’ is arbitrarily group project activities for overall emissions increase from the defined in our regulations at 40 CFR 52.21(b)(52). the purpose of avoiding the NSR major project exceeds the applicable In general, we use the term ‘‘project’’ to mean the modification requirements. Rather, in significant emissions rates, then the physical change or change in method of operation source could be subject to NSR at that under review, though this can encompass one or accordance with the 2018 final action more activities at an existing major source. On the on project aggregation, sources should time and potentially an enforcement other hand, the term ‘‘project aggregation’’ used in define a project to include all activities, action. While a commenter expressed the agency’s 2018 project aggregation interpretation and only those activities, that meet the concern that some sources may claim and policy discusses how multiple activities should unenforceable decreases to avoid NSR be evaluated to determine whether these activities ‘‘substantially related’’ test. constitute one project. Other commenters asserted that the and then simply avoid following 86 84 FR 39244 at 39251 (August 9, 2019). EPA failed to address the possibility through with those decreases once the 87 These comments can be found in Section 5.0 that facilities could circumvent NSR by statute of limitations period has passed, of the Response to Comments document for this proffering in Step 1 an emissions the EPA views this possibility as remote action. because of the safeguard at 40 CFR 88 These comments can be found in Section 5.0 decrease that turns out to be nothing but of the Response to Comments document for this action. 89 74 FR 2376, at 2380 (January 15, 2009). 90 40 CFR 52.21(b)(41)(ii)(a).

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52.21(a)(2)(iv)(b) and the potential for might increase emissions from that unit in accounting for the full impact of a civil, or even criminal, enforcement.91 trigger major NSR retroactively.93 In project in Step 1, a source would not be Finally, several commenters responding to comments on the actual- required to obtain a major NSR permit, questioned the EPA’s decision to forgo to-potential methodology in 2002, the the large majority of these projects a requirement that emissions reductions EPA noted that the establishment of an would still be required, as noted earlier, be enforceable and creditable in order to enforceable permit limit ‘‘may restrict to obtain a minor NSR permit under the be used in project emissions accounting. the ability of a source to increase its state or local air agency minor NSR These commenters stated that allowing emissions in association with an permitting program and, therefore, the sources to include uncreditable and increase in production or hours of project activities and any emissions unenforceable projected project operation, which when done alone are decrease(s) accounted for would be emission decreases with the knowledge not normally considered as physical or documented in those permit records.97 that the EPA will not second-guess operational changes.’’ 94 The EPA also The EPA-approved implementation those projections, referring to the stated ‘‘[w]e generally agree with plans will also still need to include Actual-to-Projected-Actual Applicability commenters who have argued that enforceable emission limits and other Test Memorandum issued by the EPA in existing emissions units in general control measures intended to protect air December 2017,92 readily invited NSR (including replacement and quality and a program for ‘‘regulation of circumvention and increased air reconstructed units) have ample track the modification and construction of pollution with no ability for third-party record such that the projection of the any stationary source within the areas enforcement. proposed project emissions alone is covered by the plan as necessary to The EPA disagrees with these sufficiently reliable and enforceable and assure that national ambient air quality commenters. First, as explained in the thus the burdens of up-front permit caps standards are achieved, including a August 2019 proposal and in the legal on emissions are unnecessary’’ and permit program as required in parts C rationale section of this final action ‘‘[w]e disagree with the commenters and D of this subchapter.’’ 98 Nothing in (Section III.B.3), the EPA intends to treat who thought that the ‘actual-to- this final rule conflicts with or the calculation of emissions decreases potential’ test should be retained diminishes these SIP requirements. from a proposed project in the same because, among other things, the Finally, the December 2017 ATPA manner as it does emissions increases recordkeeping requirements associated Memorandum is not within the scope of from the same proposed project (i.e., with the ‘actual-to-projected-actual’ test this rulemaking, nor does it have any including emissions increases and would be burdensome . . . for most bearing on this final rule. The December decreases in Step 1 because both are sources, the burden of recordkeeping 2017 ATPA Memorandum necessary to determine the emissions [associated with use of the actual-to- communicated how the EPA intends to resulting from the project). Second, projected-actual applicability test] is apply and exercise its enforcement requiring that projected actual substantially less than the present discretion related to certain aspects of emissions be made enforceable at the burden of obtaining a permit containing the applicability provisions of the NSR time of the project could effectively an up-front cap on actual emissions.’’ 95 regulations. The policy contained in replace the actual-to-projected-actual Thus, consistent with our reasoning in that Memorandum does not constitute a applicability test with an actual-to- 2002, the EPA does not believe that rule, regulation, or other legally binding potential test, or, more accurately, an these outcomes and making emissions requirement and it does not change or actual-to-allowable test, which would reductions enforceable in Step 1 are substitute for any law, rule or directly conflict with the EPA’s necessary in order for sources regulation, or other legally binding reasoning for adopting the actual-to- evaluating projects that involve existing requirement. We, therefore, do not agree projected-actual applicability test in emissions units to reasonably determine that this final rule or the December 2017 2002 and with what the EPA believes is whether such projects would result in a APTA Memorandum will place any the best reading of CAA section significant increase in actual emissions limitations on third-party enforcement 111(a)(4). Third, the EPA believes that a just because the project includes a of the major NSR program. Nothing in requirement that projected actual calculated decrease in emissions at one this final rule changes the enforcement emissions be made enforceable at the or more emissions units. provisions available under the CAA to time of the project would effectively In any event, the regulations provide enforce the major NSR permitting confiscate any unused capacity at the that ‘‘[r]egardless of any such requirements nor the ability of third effected emissions unit and potentially preconstruction projections, a major parties to bring potential enforcement require that any future project(s) that modification results if the project causes actions to the EPA’s attention if they a significant emissions increase and a suspect that a source has avoided the 91 If an activity that was included in an initial significant net emissions increase.’’ 96 major NSR permitting requirements. projection of actual emissions no longer falls within Therefore, the EPA believes the NSR 5. Monitoring, Recordkeeping and the scope of the project, the source should regulations do provide a mechanism for reevaluate the projected emissions change of the Reporting of Emissions Decreases in project without that activity. Therefore, contrary to enforcement if a project is erroneously Step 1 of the NSR Major Modification the commenters concerns, if a source initially projected not to result in a significant Applicability Test includes an activity that decreases emissions in its emissions increase. In addition, many, if projection but subsequently decides that that not most, of emissions decreases that The provisions of 40 CFR 52.21(r)(6) activity is not within the scope of the project, it apply to projects involving existing must redo the project’s projected emissions without result from a project will be due to the installation of controls or the removal of emissions units at a major stationary that emission decreasing activity. source in circumstances where the 92 Letter from E. Scott Pruitt, to Regional an emissions unit. The EPA still Administrators, ‘‘New Source Review believes, as it did in 2002, that even if, Preconstruction Permitting Requirements; 97 The EPA expects that as part of the minor NSR Enforceability and Use of the Actual-to-Projected- permitting process, the emissions increases and 93 Actual Applicability Test in Determining Major 40 CFR 52.21(r)(4). decreases occurring from the project will be Modification Applicability,’’ December 7, 2017 94 2002 NSR Reform Rule Technical Support documented either in the permit application, (‘‘December 2017 ATPA Memorandum’’), available Document at I–4–7. demonstrating the non-applicability of major NSR, at: https://www.epa.gov/sites/production/files/2017- 95 Id. at I–4–7, 8. or as requirements in the minor NSR permit itself. 12/documents/nsr_policy_memo.12.7.17.pdf. 96 40 CFR 52.21(a)(2)(iv)(b). 98 42 U.S.C. 7410(a)(2)(C).

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owner or operator elects to use the Various commenters expressed that monitoring, recordkeeping, and actual-to-projected-actual applicability considering emissions increases and reporting requirements for sources test for calculating projected actual decreases in Step 1 of the NSR major whose emissions do not meet the emissions and there is a reasonable modification applicability test would ‘‘reasonable possibility’’ threshold is possibility (as defined in subparagraph not necessitate any additional compounded by the EPA’s decision to (r)(6)(vi)) that a project that is not part monitoring, recordkeeping, or reporting not require that emissions decreases of a major modification may result in a requirements to promote NSR considered in Step 1 be enforceable. significant emissions increase. When compliance because the current According to these commenters, sources the reasonable possibility criteria in requirements under 40 CFR 52.21(r)(6) considering emissions increases and subparagraph (r)(6)(vi) are triggered, are adequate for this purpose. A couple decreases in Step 1 of the NSR major specific pre- and post-project of these commenters came to this modification applicability test would be recordkeeping, monitoring and determination because, in the existing able to pair an unenforceable emission reporting requirements in paragraph rules, the EPA has already determined decrease with an otherwise significant (r)(6) must be met, depending on the that sources should not be required to emission increase to avoid NSR, and can circumstances. Those include the track small projected increases that are then avoid tracking the actual emission requirement that before beginning actual well below the relevant significant increase as a result of the changes by construction on the project, the owner emissions rates, and there is even less ‘‘projecting’’ that the Step 1 net or operator document and maintain a reason to track projected decreases, emissions change would be less than 50 record including a description of the since the ‘‘possibility’’ of a significant percent of the significant emissions project, identification of the emissions increase is even more remote. Some of increase level. These commenters unit(s) whose emissions of a regulated these commenters noted that existing asserted that the Administrator’s NSR pollutant could be affected by the monitoring, recordkeeping, and directive that the EPA not question a project, and a description of the reporting provisions in state and federal source’s NSR calculations (except in applicability test used to determine that laws that cover all NSR-affected ‘‘major cases of ‘‘clear error’’), referring to the the project is not a major modification sources,’’ and particularly the December 2017 APTA Memorandum, for any regulated NSR pollutant requirements for ‘‘. . . semiannual means there is little chance that (including certain specified reporting, compliance reporting and facilities’ calculations will be audited information). certifications, and periodic emissions and even less chance that the EPA will inventory reporting under Title V The requirements of 40 CFR be able to check the actual emission permits, are stringent and adequate to 52.21(r)(6) also include pre-project increases resulting from changes. assure that NSR violations will not reporting (for electric utility steam The EPA agrees with the commenters occur as a result’’ of considering generating units) and post-project that concluded that the regulations at 40 emissions increases and decreases in monitoring and reporting of emissions CFR 52.21(r)(6) are sufficient and Step 1. Another commenter added that of any regulated NSR pollutant that appropriate to ensure that adequate minor source permitting requirements could increase as a result of the project records are maintained in circumstances will often apply to projects that are not where there is a reasonable possibility, and that is emitted by any emissions subject to major NSR permitting and unit identified in the pre-project record as defined in the regulations, that a that the reviewing authority will verify project determined not to constitute a whose emissions could be ‘‘affected’’ by a source’s rationale for determining that the project. Under these monitoring major modification could result in a a project is minor. significant emissions increase. Those provisions, sources must calculate and Other commenters, however, felt that maintain a record of the annual provisions apply equally to projects that the ‘‘reasonable possibility’’ provisions trigger the reasonable possibility emissions, in tons per year on a of 40 CFR 52.21(r)(6) are insufficient to calendar year basis, for a period of 5- or criteria, regardless of whether those guard against potential circumvention of projects include only increases, or 10-years following resumption of NSR requirements. Commenters in this regular operations after the change, increases and decreases in emissions, group stated that sources would be able consistent with the clarifications in this depending on the type of change at the to forgo the reasonable possibility unit(s). Post-project reporting is final rule. We also agree that other requirements by projecting that an records required to be maintained and required for electric utility steam emissions increase will be less than 50 generating units and is triggered when reported under CAA programs will percent of the significant emission support compliance with the NSR certain specific criteria that are increase level. A few commenters added applicable to all other categories of applicability regulations and that reliance on the provisions of 40 enforcement of those regulations as emissions units are met. In accordance CFR 52.21(r)(6) would complicate with 40 CFR 52.21(r)(7), the information necessary. In imposing reasonable enforcement actions because the possibility recordkeeping requirements, required to be documented and calculations sources conduct to comply the EPA ‘‘strove for a balance between maintained pursuant to paragraph (r)(6) with these provisions often do not ease of enforcement and avoidance of shall be available for review upon a include all emissions units associated requirements that would be unnecessary request for inspection by the reviewing with a project, especially affected units or unduly burdensome on reviewing authority or the general public. As that are not modified or constructed authorities or the regulated described in the proposal preamble, the under a project. These commenters community.’’ 99 Beyond alleging requirements of 40 CFR 52.21(r)(6) emphasized that while sources can potential NSR circumvention, the apply equally to units with projected explain if annual emissions from a commenters who oppose the use of the increases and projected decreases in project exceed the baseline emissions by emissions, as long as there is a an amount greater than the significant reasonable possibility provisions did reasonable possibility that the project emission rate, assessing the validity of not provide any persuasive rationale for could result in a significant emissions such explanations places an undue 99 72 FR 72607, at 72610 (December 21, 2007). increase and those units are part of the burden upon the reviewing authority. The ‘‘reasonable possibility’’ provisions of the project (i.e., their emissions ‘‘could be Several commenters suggested that existing regulations are currently in litigation. State affected’’ by the project). the problems related to the lack of of New Jersey v. EPA, No. 08–1065 (D.C. Cir.).

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treating emissions increases and the December 2017 APTA Memorandum 6. Considering Emissions Decreases in decreases differently for purposes of will have any effect on third-party Step 1 for Delegated and SIP-Approved tracking emissions under those enforcement of the major NSR program. Programs requirements. Since projected actual Nothing in this final rule changes the In the proposal, we indicated that if emissions must be based on all relevant enforcement provisions available under this rule was finalized, any revisions to information, sources may not arbitrarily the CAA to enforce the major NSR the regulations at 40 CFR 52.21 would project emissions below the permitting requirements nor the ability apply to the EPA and reviewing applicability levels for these of third parties to alert the EPA if they authorities that have been delegated recordkeeping, monitoring, and suspect that a source has improperly federal authority by the EPA to issue reporting requirements. avoided the major NSR permitting PSD permits on behalf of the EPA (via We agree that in many or most cases, requirements. a delegation agreement with an EPA projects that involve both increases and Regional Office).101 The EPA also Other commenters challenged the decreases in emissions in Step 1 that do indicated that for state and local air not trigger the reasonable possibility EPA’s reference to the reasonable agencies that implement the NSR provisions will be subject to minor NSR possibility standard in the proposal on program through EPA-approved SIPs,102 permitting requirements. As such, procedural grounds. These commenters the EPA also proposed to revise the records of the project activities, the stated that the reasonable possibility regulations for approval of such emissions increases and any emissions provisions are not only insufficient, but programs (40 CFR 51.165 and 40 CFR decreases associated with those that they are ‘‘arbitrary and capricious’’ 51.166) to be consistent with the activities, the applicability test and the because the EPA failed in the proposal proposed revisions to 40 CFR corresponding emissions calculations of this rule to specify how the 52.21(a)(2)(iv).103 For these SIP- should be available or made available provisions of 40 CFR 52.21(r)(6) are approved programs, the EPA also for review as part of the permit applicable to the consideration of indicated that if the EPA were to application and permit records for the emissions increases and decreases in finalize the clarifications being project, which include the permit terms. proposed, reviewing authorities may not The EPA, however, disagrees that the Step 1 project emissions accounting. need to revise their state regulations and ‘‘reasonable possibility’’ provisions at One commenter added that ‘‘at the submit SIP revisions if the current NSR 40 CFR 52.21(r)(6) are insufficient to outset, depending on how ‘the project’ major modification applicability guard against NSR circumvention as a is defined by the source operator, the provisions in those regulations can be result of considering emissions plain text of [40 CFR 52.21(r)(6)], on its interpreted to allow for project increases and decreases in Step 1 and face, does not apply to emissions emissions accounting or if those state that reliance on those provisions would decreases.’’ and local air agencies incorporate the complicate enforcement and/or place The EPA disagrees with these federal NSR regulations by reference undue burden on reviewing authorities commenters. The requirements of 40 without a date restriction. Lastly, the for the reasons cited. First, as explained CFR 52.21(r)(6) apply when there is a EPA mentioned that it was currently in Section III.B.4 of this final rule reasonable possibility that the project aware of a few states and local programs preamble, applying the EPA’s 2018 final could result in a significant emissions where the applicable SIP-approved action on project aggregation increase and that those units are part of regulations expressly preclude project interpretation and policy makes clear the project (i.e., their emissions ‘‘could that any decreases from activities that emissions accounting. Thus, we are accounted for in Step 1 should be be affected’’ by the project). While requested comment on whether the EPA ‘‘substantially related’’ to any increases practically-speaking this would only should determine that the proposed from activities that are part of the same apply to a project resulting in an overall revisions to 40 CFR 51.165(a)(2)(ii)(F) project, meaning that those decreases in increase in emissions because an overall and (G) and 40 CFR 51.166(a)(7)(iv)(f) fact result from the project. Second, decrease would clearly not have a and (g) constitute minimum program manipulating NSR major modification reasonable possibility of triggering NSR, elements that must be included in order applicability calculations to circumvent this does not mean that decreases for state and local agency programs NSR and/or avoid the ‘‘reasonable cannot be considered when determining implementing part C or part D to be 104 possibility’’ requirements in the whether a project would result in an approvable under the SIP. Commenters expressed various regulations could subject a source to the overall increase sufficient to trigger positions regarding whether the NSR requirements, substantial civil these requirements. When the proposed revisions should constitute penalties, and/or criminal liability. The reasonable possibility criteria in minimum program elements that must regulations provide that ‘‘[r]egardless of subparagraph (r)(6)(vi) are triggered by any such preconstruction projections, a be included for state and local programs an overall increase, specific pre- and implementing parts C or D of Title I of major modification results if the project post-project recordkeeping, monitoring causes a significant emissions increase and reporting requirements in paragraph 101 and a significant net emissions There are currently 7 states that have full or (r)(6) must be met, as described partial delegation of authority to issue PSD permits 100 increase.’’ Thus, if any emissions previously. on behalf of the EPA. decreases are overstated, and/or any 102 The applicable regulations for state and local increases understated, such that the Based on the regulations themselves air agencies that implement the NSR program emissions projection at the time shows and the comments received, the EPA is through the EPA-approved SIPs include 40 CFR concluding that the provisions of 40 51.165(2)(ii)(F) and (G); to 40 CFR 51.166(a)(7)(iv)(f) a source is not subject to NSR or the and (g). Any references to SIP-approved plans also reasonable possibility requirements, the CFR 52.21(r)(6) are sufficient for refer to the plans submitted by local air agencies to source will be subject to NSR if and purposes of enforcing the NSR major the EPA for approval. when the project actually results in a modification applicability requirements 103 Supra n. 03. As indicated in footnote n. 03, major modification. Finally, and as including the clarifying revisions to the revisions being finalized in this action also apply to Appendix S of part 51. stated previously, we do not agree that those applicability requirements in this 104 Such a determination was made with respect final rule. to the NSR regulatory revisions the EPA made in 100 40 CFR 52.21(a)(2)(iv)(b). 2002. 67 FR 80185, at 80240 (December 31, 2002).

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the CAA to be approvable under a even where a more-complete accounting require the reporting of any information SIP.105 A few commenters stated that of their emissions (i.e., accounting of concerning projects that are not this final rule should constitute both emissions increases and decreases pursued. Thus, in the proposal, we minimum program elements that must in Step 1 of the NSR major modification asked that commenters provide be included in an EPA-approved SIP on applicability test) would reveal that the information on particular examples that the basis that the changes in this final project produced either an emissions could assist the EPA in providing some rule are clarifications of the regulations decrease or a de minimis increase in level of qualitative impacts analysis adopted by the 2002 NSR Reform Rule. emissions. when finalizing this action. Another one of these commenters stated For SIPs approved under 40 CFR In response to this solicitation, a few that requiring the proposed rule 51.166, the EPA has determined that commenters noted that project revisions to be minimum program conforming state/local plan revisions emissions accounting is consistent with elements for programs implementing will not be subject to the deadline by the CAA and with the congressional part C or part D to be approvable under which a reviewing authority is typically intent that the PSD and NNSR a SIP would ensure national required to revise its implementation preconstruction permitting programs consistency. plan in response to amendments to the only apply when an existing source Various commenters, however, federal regulations.108 Similarly, undertakes a project resulting in a opposed the concept of making project because the EPA views not allowing significant increase in emissions. emissions accounting a minimum project emissions accounting to be at Several commenters, however, indicated program element for programs least as stringent as the requirements that this final rule would result in implementing part C or part D to be under 40 CFR 51.165, plans already negative environmental impacts by approvable under a SIP. Some of these approved under the current version of allowing sources to forgo major NSR commenters noted that under section that section of the CFR will continue to permitting and the associated BACT or 116 of the CAA, states can adopt SIP be at least as stringent as the revised LAER requirement. Commenters stated provisions that are more stringent than regulations and states and local air that the emissions increases that would those required by the EPA’s regulations. agencies will not need to submit result from this final rule would A couple of commenters added that revisions to already approved plans.109 contravene the purpose of the NSR requiring the implementation of project program to require permits where 7. Environmental and Economic Impact emissions accounting would run afoul changes at industrial facilities might Considerations of Project Emissions of the sovereign authority of state increase air pollution. Other Accounting governments. commenters noted that this final rule After reviewing the comments Two commenters asserted that the may have the potential of reducing received on this matter, the EPA has EPA was required to evaluate the overall emissions by removing a determined that the revisions to the environmental impacts of the proposed disincentive for sources seeking to regulations at 40 CFR 52.21 adopted in rule. One of these commenters argued undertake projects that would improve this final rule apply to the EPA and that the EPA’s lack of permitting data the energy efficiency of their operations. reviewing authorities that have been does not excuse the agency from After consideration of the comments delegated federal authority from the conducting an analysis of the received on this matter, we would like EPA to issue major NSR permits on environmental impacts of the rule and to reiterate that this final rule will not behalf of the EPA.106 For state and local that the EPA must use data from its own allow projects that themselves result in air agencies that implement the NSR records and/or request data from state a significant emissions increase (i.e., an program through EPA-approved SIPs, and local reviewing authorities to increase greater than de minimis levels) the EPA agrees with those commenters conduct such an analysis. and a significant net emissions increase who argued that section 116 of the CAA In the proposal preamble we to proceed without obtaining a major allows these states and local air agencies indicated that we are unable at this time NSR permit. Rather, the final rule to adopt more stringent SIP emission to estimate any potential environmental merely clarifies the NSR major control requirements than required by or economic impacts or changes in modification applicability test to allow the EPA’s regulations.107 Thus, the EPA emissions associated with project for a more accurate accounting of a is concluding that reviewing authorities emissions accounting because most NSR project’s impacts on air quality to the that do not allow for project emissions permits are issued by state and local air surrounding area by allowing a source accounting have applicability agencies and the EPA generally lacks to consider all changes in emissions— requirements that are at least as information on the economic and both increase and decreases—that result stringent as those required by the Act or environmental impacts of NSR permits. from a project in its calculation of the the EPA’s implementing regulations NSR permitting is a case-by-case process proposed project emissions. This is and, therefore, are not required to and sources make permitting decisions consistent, rather than contrary, to the submit SIP revisions or stringency based on many factors. Furthermore, congressional intent for the NSR determinations to the EPA as a result of neither the EPA nor state and local program. Additionally, despite a this action. This is because sources that reviewing authorities have access to any commenter’s assertion that this rule will are not allowed to use project emissions records of decisions made by sources allow sources to emit more by accounting may be subject to major NSR which would indicate whether a project circumventing the BACT or LAER was or was not undertaken in view of requirements, there is no evidence to 105 A SIP refers to an implementation plan the unavailability of project emissions suggest that the final rule will result in submitted by a State to the EPA for approval. In this accounting. We do not, for example, greater overall emissions increases than preamble, this term also refers to implementation plans submitted by local agencies. would otherwise be allowed from 106 PSD program provisions have been delegated 108 40 CFR 51.166(a)(6). The EPA’s view is that no projects affected by the rule. For to reviewing authorities. Reviewing authorities in state is ‘‘required to revise its implementation plan example, as the EPA noted in the Indian country can request delegation of the major by reason of’’ the amendment to 51.166 reflected in proposed rule and as indicated by some NA NSR provisions, but to date, none have done this final rule. so. 109 40 CFR 51.165(a)(1), (a)(2)(ii), and (a)(6) commenters, it is equally conceivable 107 Union Electric v. EPA, 427 U.S. 246,263–264 (allowing deviations only when at least as that accounting for emissions decreases (1976). stringent). in Step 1 of the NSR major modification

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applicability test will incentivize throughput and cooling capacity) may reduces the permitting burden for sources to undertake energy efficiency also include the installation of sources undertaking economically- and/or other environmentally beneficial emissions control equipment such as beneficial projects that do not produce projects that they might otherwise have installing a geodesic dome to an a greater than de minimis increase in forgone. In addition, just because a external floating roof tank to control emissions. The EPA has provided a project might result in a significant volatile organic content (VOC) more complete discussion of the increase in emissions in Step 1 without emissions, retrofitting a cooling water potential environmental impacts of the the accounting for emissions decreases tower with drift eliminators to reduce rule as well as the difficulties of from the project, does not mean that the particulate matter emissions; and/or accurately projecting such impacts in project would be subject to the BACT or installing dual-seal pumps to reduce the Environmental Justice LAER requirements. Such a project fugitive VOC emissions. If the Considerations Section of this preamble could still result in a net emissions consideration of emissions decreases as and the same analysis is provided in the decrease, or a net emissions increase part of project emissions accounting at Response to Comments document for that is not significant and does not Step 1 were not available, a project that this final action. also involves the installation of trigger the major NSR permitting IV. Environmental Justice emissions control equipment that requirements. It is therefore improper to Considerations compare the use of project emissions reduces overall emissions could be accounting to the application of BACT foregone due to the complexities of Step In the proposal, the EPA stated that or LAER. These outcomes are not an 2 contemporaneous netting. Project we did not believe that the proposed either-or proposition for a project that emissions accounting may also expedite revisions to the NSR major modification would not result in a significant the environmental benefits associated applicability regulations would have emissions increase when accounting for with converting a unit to a lesser- any effect on environmental justice decreases but would result in a emitting fuel source. For example, when communities because the EPA’s NSR significant emissions increase when emissions decreases are considered at regulations in place since the 2002 NSR decreases from the project are not Step 1, a source owner or operator Reform Rule was finalized to allow considered in Step 1. proposing a project that replaces project emissions accounting. As such, existing oil-fired boilers with lesser- the EPA expected no increase in the Several commenters submitted emitting natural gas boilers might not permitting burden for sources, examples of actual projects that trigger permitting at Step 1, but it would reviewing authorities or environmental involved emissions decreases that reduce its overall emissions. If project justice communities after finalization of would be more likely to proceed with emissions accounting were not the proposed rule revisions. the availability of project emissions available, the source would likely Nevertheless, one commenter argued accounting. These examples included trigger Step 1 and also undergo the Step that because the proposed revisions replacement projects, projects involving 2 analysis to determine if it needs a would alter how major modifications the installation of control equipment, major modification permit for its are determined under the NSR program, and fuel changes—projects that may proposed project. Under Step 2, the they would result in fewer result in a reduction of overall source owner or operator would be modifications being subject to major emissions but may be forgone if required to consider all other NSR and, therefore, the environmental decreases associated with the projects contemporaneous emissions increases justice impacts of the rule must be are not considered. For example and decreases from the project, usually considered accordingly. The commenter commenters mentioned that, a source within a five-year time period, even added that it is clear that the intention may forgo, the installation of an end-of- though the project itself would have of this rulemaking is to reduce the life replacement to avoid NSR already resulted in a decrease in the number of projects that are considered permitting since the emissions would actual emissions from the facility. major modifications under NSR and this appear as an emissions increase in Step Therefore, a source may decide to forgo will reduce public health and welfare 1 of the applicability determination transitioning to a lesser-emitting fuel to protection. According to the commenter, even when the replacement would have avoid going through some of the this is because fewer facilities will be reduced the potential emissions. While complexities of Step 2 contemporaneous required to ensure that the changes they the new unit in general may be larger in netting or potentially having to receive are making are protective of ambient air capacity, their design and material a major NSR permit for a project that quality and fewer facilities will be changes generally entail increased decreases emissions. The Response to required to install pollution controls on efficiency and lower emissions. Newer Comments document for this final new or modified units because their units may also generally contain action contains more details about these changes will not trigger NSR. Moreover, inherent emissions controls (e.g., the commenter stated that projects.110 heaters equipped with low NO X Based on the information and environmental justice initiatives stem burners) that also lower the source’s examples provided, the EPA believes from the fact that facilities with the overall emissions. If the source can that considering the full scope of the worst environmental impact are more count emissions decreases from this impact of a project ensures that likely to be located in areas with higher project under project emissions congressional intent for the NSR poverty rates, communities of color, or accounting, then the source may be program, to ensure environmental tribal lands. We continue to believe that these rule more likely to undertake the project, or protection while allowing for economic revisions will not impact environmental the source owner might expedite it. growth, is met. That is to say, this rule justice communities in a manner that is However, the project may be foregone if provides more clarity to sources and different than any impact this rule the emission decreases could only be reviewing authorities applying the NSR might have in any other area of the considered as part of a more complex applicability test and potentially Step 2 contemporaneous netting country. As we explained in the analysis. Furthermore, commenters 110 These comments can be found in Section 4.0 proposal preamble, and as stated noted that proposing a project (e.g. and 5.0 of the Response to Comments document for elsewhere in this preamble, we interpret expansion that results in increased tank this action. our regulations to already allow for

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project emissions accounting even in the new unit in general may be larger in transitioning to a lesser-emitting fuel to the absence of this rule. This capacity, their design and material avoid going through some of the rulemaking will only serve to provide changes generally entail increased complexities of Step 2 contemporaneous greater clarity with respect to the major efficiency and lower emissions. Newer netting or potentially having to receive NSR applicability procedures and, thus, units may also generally contain a major NSR permit for a project that will incentivize states to implement inherent emissions controls (e.g., decreases emissions. project emissions accounting at their heaters equipped with low NOX While this rule may allow projects discretion. This improved clarity itself burners) that also lower the source’s that produce an overall de minimis confers potential benefits to overall emissions. If the source can increase in emissions to forgo the major environmental justice communities by count emissions decreases from this NSR permitting process, the EPA removing a disincentive to the project under project emissions believes that it is equally conceivable implementation of energy efficiency accounting, then the source may be that the rule will create an incentive for improvements and other more likely to undertake the project, or sources to adopt emissions-reducing environmentally beneficial projects at the source owner might expedite it. processes and technology (that may industrial sources for sources that might However, the project may be foregone if represent control beyond what would be have forgone these projects due to the the emission decreases could only be required for BACT or LAER) that they complexity of the Step 2 considered as part of a more complex would not have otherwise adopted if contemporaneous netting analysis. Step 2 contemporaneous netting project emissions accounting were not However, to aid stakeholders in their analysis. available. At the very least, the final rule assessment of the potential impacts of Examples of projects involving the may expedite efficiency-enhancing this action and to be responsive to the installation of emissions control projects that would have otherwise comments received, we did perform a equipment: Proposing a project (e.g. require a more complex and potentially qualitative analysis of a few examples of expansion that results in increased tank burdensome Step 2 analysis to actual projects that may reduce air throughput and cooling capacity) may determine that the efficiency-enhancing emissions due to the availability of also include the installation of projects would have ‘‘netted out’’ or not project emissions accounting at Step 1 emissions control equipment such as be subject to major NSR permitting. of the NSR major modification installing a geodesic dome to an These efficiency improvements may applicability test. These examples are external floating roof tank to control have collateral benefits. based on the comments received during volatile organic content (VOC) The EPA also notes that projects at the public comment period for this final emissions, retrofitting a cooling water existing major stationary sources that action, are included as part of the tower with drift eliminators to reduce are determined not to trigger major NSR Response to Comments document for particulate matter emissions; and/or permitting requirements, will, in many this final action and are also installing dual-seal pumps to reduce or most cases, be subject to minor NSR summarized in the next few paragraphs fugitive VOC emissions. If the permitting requirements, regardless of of this section of the preamble. This consideration of emissions decreases as the accounting procedures used in analysis, however, does not provide a part of project emissions accounting at determining major NSR applicability. qualitative estimate of the potential Step 1 were not available, a project that Minor NSR permit actions require the environmental impacts of accounting for also involves the installation of opportunity for public comment,112 emissions decreases at Step 1 of the emissions control equipment that which provides an opportunity for NSR major modification applicability reduces overall emissions could be stakeholders to raise potential test since the commenters did not foregone due to the complexities of Step environmental justice concerns based provide information of any potential 2 contemporaneous netting. on the characteristics of the project and emissions increases or decreases that Examples of projects involving fuel the location of the project relative to any would have occurred in these examples changes: Project emissions accounting environmental justice communities based on the availability of project may also expedite the environmental within the vicinity of the source. emissions accounting at Step 1.111 benefits associated with converting a Furthermore, while the EPA shares Examples of replacement projects: A unit to a lesser-emitting fuel source. For the commenter’s concerns regarding the source may forgo, the installation of an example, when emissions decreases are potential impacts of air pollution on end-of-life replacement to avoid NSR considered at Step 1, a source owner or environmental justice communities, the permitting since the emissions would operator proposing a project that EPA notes that the NSR program is but appear as an emissions increase in Step replaces existing oil-fired boilers with one of many programs that address air 1 of the applicability determination lesser-emitting natural gas boilers might pollution under the Clean Air Act. even when the replacement would have not trigger permitting at Step 1, but it In addition, and as noted elsewhere in reduced the potential emissions. While would reduce its overall emissions. If this preamble and in the Response to project emissions accounting were not Comments document for this final 111 In its preamble to the proposal, the EPA also available, the source would likely action, the EPA views project emissions highlighted an example of a source that could have trigger Step 1 and also undergo the Step accounting as being fully consistent saved four additional months of the overall 2 analysis to determine if it needs a with the Act and the 2002 NSR Reform permitting process timeline and $80,000 had it had the opportunity to use project emissions major modification permit for its Rule. Allowing for project emissions accounting, but there were no emissions proposed project. Under Step 2, the accounting will ensure that a project implications tied to this example. Thus, it is source owner or operator would be that itself results in a de minimis conceivable that the permitted source was not required to consider all other increase in emissions, or even a beholden to BACT/LAER emissions reductions or that the source, had it been able to institute the contemporaneous emissions increases decrease in emissions, will not be project earlier, could have instituted emissions and decreases from the project, usually subject to major NSR. As stated reductions to offset any emissions reductions that within a five-year time period, even previously, the NSR program was may have been attributed to the resulting BACT/ though the project itself would have designed to ensure environmental LAER requirements (assuming such requirements were imposed on the source), while reducing the already resulted in a decrease in the protection while allowing for economic permitting time burden and avoiding triggering the actual emissions from the facility. major NSR permitting requirements. Therefore, a source may decide to forgo 112 40 CFR 51.161.

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growth by managing increases in for under the approved information such, the clarifying revisions being emissions from economic development. collection requests. proposed will not impose direct The EPA believes that project emissions burdens on tribal authorities. Thus, D. Regulatory Flexibility Act (RFA) accounting properly balances those Executive Order 13175 does not apply interests. In addition, as noted I certify that this action will not have to this action. elsewhere, reviewing authorities have a significant economic impact on a H. Executive Order 13045: Protection of the discretion to not allow project substantial number of small entities Children From Environmental Health emissions accounting and to create or under the RFA. This action will not and Safety Risks maintain requirements under their SIPs impose any requirements on small that are at least as stringent as the entities. Before this rule was finalized, The EPA interprets Executive Order requirements specified in the EPA’s the EPA interpreted its NSR regulations 13045 as applying only to those regulations. to allow for project emissions regulatory actions that concern accounting and, as such, no increased or environmental health or safety risks that Finally, current analytical tools and decreased burden is expected for the EPA has reason to believe may methods do not allow for a more sources or reviewing authorities after disproportionately affect children, per quantitative analysis of environmental the finalization of the clarifications the definition of ‘‘covered regulatory and economic costs associated with the included in this rule. Furthermore, the action’’ in section 2–202 of the NSR applicability test at this time. EPA is not making the regulatory Executive Order. This action is not However, the EPA will consider changes in this final rule mandatory for subject to Executive Order 13045 whether any newly developed analytical adoption and, as such, only major because it does not concern an tools or methods would allow for such stationary sources located in areas environmental health risk or safety risk. a quantitative analysis in connection where reviewing authorities decide to with some future NSR regulatory action. I. Executive Order 13211: Actions newly implement project emissions Concerning Regulations That V. Statutory and Executive Order accounting might see a burden Significantly Affect Energy Supply, Reviews reduction if the consideration of Distribution, or Use emissions increases and decreases in A. Executive Order 12866: Regulatory Step 1 does not trigger further This action is not a ‘‘significant Planning and Review and Executive permitting requirements that may have energy action’’ because it is not likely to Order 13563: Improving Regulation and otherwise required these major have a significant adverse effect on the Regulatory Review stationary sources to obtain a major NSR supply, distribution or use of energy. In This action is a significant regulatory permit. addition, and before this rule was action that was submitted to the Office finalized, the EPA interpreted its NSR E. Unfunded Mandates Reform Act regulations to allow for project of Management and Budget (OMB) for (UMRA) review since it raises policy issues emissions accounting and, as such, no arising from the President’s priorities. This action does not contain any increased burden is expected for sources Any changes made in response to OMB unfunded federal mandate as described or reviewing authorities after the recommendations have been in UMRA, 2 U.S.C. 1531–1538, and does finalization of the clarifications documented in the docket as required not significantly or uniquely affect small included in this rule. Furthermore, the by section 6(a)(3)(E) of Executive Order governments. The action imposes no EPA is not making the regulatory 12866. enforceable duty on any state, local or changes in this final rule mandatory for tribal governments or the private sector. adoption and, as such, only major B. Executive Order 13771: Reducing stationary sources located in areas F. Executive Order 13132: Federalism Regulations and Controlling Regulatory where state and local reviewing Costs This action does not have federalism authorities decide to newly implement implications. It will not have substantial project emissions accounting might see This action is considered an direct effects on the states, on the a burden reduction if the consideration Executive Order 13771 deregulatory relationship between the national of emissions increases and decreases in action. Before completing this rule, the government and the states, or on the Step 1 does not trigger further EPA interpreted its NSR regulations to distribution of power and permitting requirements that may have allow for project emissions accounting. responsibilities among the various otherwise required these major To the extent the clarifications included levels of government. stationary sources to obtain a major NSR in this rule influence the actions of permit. sources and reviewing authorities to G. Executive Order 13175: Consultation increase the use of project emissions and Coordination With Indian Tribal J. National Technology Transfer and accounting, this final rule will provide Governments Advancement Act burden reduction. This action does not have tribal This rulemaking does not involve C. Paperwork Reduction Act (PRA) implications as specified in Executive technical standards. Order 13175. The EPA’s NSR major This action does not impose any new modification applicability regulations in K. Executive Order 12898: Federal information collection burden under the place after the 2002 NSR Reform Rule Actions To Address Environmental PRA. OMB has previously approved the allow for the consideration of emissions Justice in Minority Populations and information collection activities increases and decreases in Step 1 of the Low-Income Populations contained in the existing regulations NSR major modification applicability The EPA believes that this action does and has assigned OMB control numbers test and, as such, the clarifying revisions not have disproportionately high and 2060–0003 for the PSD and NNSR being proposed in this rule will not adverse human health or environmental permit programs. The burden associated have exclusive tribal implications. effects on minority populations, low- with obtaining an NSR permit for a Furthermore, the EPA is currently the income populations and/or indigenous major stationary source undergoing a reviewing authority for PSD and NNSR peoples, as specified in Executive Order major modification is already accounted permits issued in tribal lands and, as 12898 (59 FR 7629, February 16, 1994).

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Before this rule was finalized, the EPA 40 CFR Part 52 equals or exceeds the significant amount interpreted its NSR regulations to allow Environmental protection, Air for that pollutant (as defined in for project emissions accounting and pollution control, Incorporation by paragraph (b)(23) of this section). this action only finalized clarifying reference. (g) The ‘‘sum of the difference’’ as revisions to the NSR major modification used in paragraphs (c), (d) and (f) of this applicability regulations. Further Andrew Wheeler, section shall include both increases and information on the Environmental Administrator. decreases in emissions calculated in Justice considerations are included in For the reasons stated in the accordance with those paragraphs. Section IV of this final action’s preamble, title 40, chapter I of the Code * * * * * preamble. of Federal Regulations is amended as follows: Subpart CC—Provisions for L. Congressional Review Act (CRA) Implementation of the 2015 Ozone PART 51—REQUIREMENTS FOR National Ambient Air Quality This action is subject to the CRA, and PREPARATION, ADOPTION, AND Standards the EPA will submit a rule report to SUBMITTAL OF IMPLEMENTATION ■ each House of the Congress and to the PLANS 4. Appendix S to part 51 is amended Comptroller General of the United by revising section IV.I.1.(v) and adding States. This action is not a ‘‘major rule’’ ■ 1. The authority citation for part 51 paragraph (vi) to read as follows: as defined by 5 U.S.C. 804(2). continues to read as follows: Appendix S to Part 51—Emission Offset M. Judicial Review Authority: 23 U.S.C. 101; 42 U.S.C. 7401– Interpretative Ruling 7671q. * * * * * Under CAA section 307(b)(1), petitions for judicial review of any Subpart I—Review of New Sources and IV. Sources That Would Locate in a nationally applicable regulation, or any Modifications Designated Nonattainment Area * * * * * action the Administrator ‘‘finds and ■ 2. Section 51.165 is amended by publishes’’ as based on a determination I. Applicability procedures. revising paragraph (a)(2)(ii)(F) and 1. * * * of nationwide scope or effect must be adding paragraph (G) to read as follows: (v) Hybrid test for projects that involve filed in the United States Court of multiple types of emissions units. A Appeals for the District of Columbia § 51.165 Permit requirements. significant emissions increase of a regulated Circuit within 60 days of the date the (a) * * * NSR pollutant is projected to occur if the promulgation, approval, or action (2) * * * sum of the difference for all emissions units, appears in the Federal Register.113 This (ii) * * * using the method specified in paragraphs action is nationally applicable, as it (F) Hybrid test for projects that IV.I.1(iii) through (iv) of this Ruling as involve multiple types of emissions applicable with respect to each emissions clarifies the applicability provisions that unit, equals or exceeds the significant apply to Step 1 of the NSR major units. A significant emissions increase of a regulated NSR pollutant is projected amount for that pollutant (as defined in modification applicability test in 40 paragraph II.A.10 of this Ruling). to occur if the sum of the difference for CFR 51.165, 51.166, 52, and appendix S (vi) The ‘‘sum of the difference’’ as used in all emissions units, using the method to part 51. As a result, petitions for paragraphs (iii), (iv) and (v) of this section specified in paragraphs (a)(2)(ii)(C) review of this final action must be filed shall include both increases and decreases in through (D) of this section as applicable emissions calculated in accordance with in the United States Court of Appeals with respect to each emissions unit, those paragraphs. for the District of Columbia Circuit by equals or exceeds the significant amount * * * * * January 25, 2021. Filing a petition for for that pollutant (as defined in reconsideration by the Administrator of paragraph (a)(1)(x) of this section). PART 52—APPROVAL AND this final action does not affect the (G) The ‘‘sum of the difference’’ as PROMULGATION OF finality of this action for the purposes of used in paragraphs (C), (D) and (F) of IMPLEMENTATION PLANS judicial review nor does it extend the this section shall include both increases time within which a petition for judicial and decreases in emissions calculated in ■ 5. The authority citation for part 52 review must be filed and shall not accordance with those paragraphs. continues to read as follows: postpone the effectiveness of this * * * * * Authority: 42 U.S.C. 7401 et seq. 114 action. ■ 3. Section 51.166 is amended by Subpart A—General Provisions VI. Statutory Authority revising paragraph (a)(7)(iv)(f) and adding paragraph (g) to read as follows: ■ 6. Section 52.21 is amended by The statutory authority for this action revising paragraph (a)(2)(iv)(f) and is provided by 42 U.S.C. 7401, et seq. § 51.166 Prevention of significant deterioration of air quality. adding paragraph (g) to read as follows: List of Subjects (a) * * * § 52.21 Prevention of significant (7) * * * deterioration of air quality. 40 CFR Part 51 (iv) * * * (a) * * * Environmental protection, Air (f) Hybrid test for projects that involve (2) * * * pollution control. multiple types of emissions units. A (iv) * * * significant emissions increase of a (f) Hybrid test for projects that involve regulated NSR pollutant is projected to multiple types of emissions units. A occur if the sum of the difference for all significant emissions increase of a emissions units, using the method regulated NSR pollutant is projected to specified in paragraphs (a)(7)(iv)(c) occur if the sum of the difference for all 113 42 U.S.C. 7607(b)(1). through (d) of this section as applicable emissions units, using the method 114 42 U.S.C. 7607(d)(7)(B). with respect to each emissions unit, specified in paragraphs (a)(2)(iv)(c)

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through (d) of this section as applicable • Federal eRulemaking Portal: Go to name and a mailing address, an email with respect to each emissions unit, http://www.regulations.gov/ address, or a phone number in the body equals or exceeds the significant amount #!docketDetail;D=FMCSA-2018-0348. of your document so that FMCSA can for that pollutant (as defined in Follow the online instructions for contact you if there are questions paragraph (b)(23) of this section). submitting comments. regarding your submission. (g) The ‘‘sum of the difference’’ as • Fax: (202) 493–2251. To submit your comment online, go used in paragraphs (c), (d) and (f) of this • Mail: Dockets Operations, U.S. to: http://www.regulations.gov/ section shall include both increases and Department of Transportation, West #!docketDetail;D=FMCSA-2018-0348, decreases in emissions calculated in Building Ground Floor, Room W12–140, click on the ‘‘Comment Now!’’ button, accordance with those paragraphs. 1200 New Jersey Avenue SE, and type your comment into the text * * * * * Washington, DC 20590–0001. box on the following screen. Choose [FR Doc. 2020–23784 Filed 11–23–20; 8:45 am] • Hand delivery: Same as mail whether you are submitting your BILLING CODE 6560–50–P address above, between 9 a.m. and 5 comment as an individual or on behalf p.m., Monday through Friday, except of a third party and then submit. Federal holidays. If you submit your comments by mail FOR FURTHER INFORMATION CONTACT: or hand delivery, submit them in an DEPARTMENT OF TRANSPORTATION Mr. 1 Richard Clemente, Driver and Carrier unbound format, no larger than 8 ⁄2 by Federal Motor Carrier Safety Operations Division, FMCSA, 1200 New 11 inches, suitable for copying and Administration Jersey Avenue SE, Washington, DC electronic filing. If you submit 20590–0001, (202) 366–4325, MCPSD@ comments by mail and would like to 49 CFR Part 395 dot.gov. If you have questions on know that they have reached the facility, please enclose a stamped, self- [Docket No. FMCSA–2018–0348] viewing or submitting material to the docket, contact Dockets Operations, addressed postcard or envelope. FMCSA will consider all comments RIN 2126–AC24 (202) 366–9826. and material received during the Hours of Service of Drivers; Definition SUPPLEMENTARY INFORMATION: This IFR is comment period and may change this of Agricultural Commodity organized as follows: IFR based on your comments. FMCSA I. Public Participation and Request for may issue a final rule at any time after AGENCY: Federal Motor Carrier Safety Comments the close of the comment period. Administration (FMCSA), DOT. A. Submitting Comments ACTION: Interim final rule with request B. Viewing Comments and Documents Confidential Business Information for comment. C. Privacy Act Confidential Business Information II. Executive Summary (CBI) is commercial or financial SUMMARY: FMCSA clarifies the III. Legal Basis for the Rulemaking information that is both customarily and IV. Background definition of the terms ‘‘any agricultural actually treated as private by its owner. commodity,’’ ‘‘livestock,’’ and ‘‘non- V. Discussion of Interim Final Rule VI. Questions Under the Freedom of Information Act processed food,’’ as the terms are used (FOIA, 5 U.S.C. 552), CBI is exempt in the definition of ‘‘agricultural VII. International Impacts VIII. Section-by-Section Analysis from public disclosure. If your commodity’’ for the purposes of the IX. Regulatory Analyses comments responsive to this IFR Agency’s ‘‘Hours of Service (HOS) of A. E.O. 12866 (Regulatory Planning and contain commercial or financial Drivers’’ regulations. Under current Review), E.O. 13563 (Improving information that is customarily treated regulations, drivers transporting Regulation and Regulatory Review), and as private, that you actually treat as agricultural commodities, including DOT Regulations private, and that is relevant or B. E.O.13771 (Reducing Regulation and livestock, from the source of the responsive to this IFR, it is important commodities to a location within 150 air Controlling Regulatory Costs) C. Congressional Review Act that you clearly designate the submitted miles of the source, during harvest and comments as CBI. Please mark each planting seasons as defined by each D. Regulatory Flexibility Act (Small Entities) page of your submission that constitutes State, are exempt from the HOS E. Assistance for Small Entities CBI as ‘‘PROPIN’’ to indicate it contains requirements. Furthermore, the HOS F. Unfunded Mandates Reform Act of 1995 proprietary information. FMCSA will requirement for a 30-minute rest break G. Paperwork Reduction Act treat such marked submissions as does not apply to drivers transporting H. E.O. 13132 (Federalism) confidential under the FOIA, and they livestock in interstate commerce while I. Privacy will not be placed in the public docket the livestock are on the commercial J. E.O. 13175 (Indian Tribal Governments) K. Environment of this IFR. Submissions containing CBI motor vehicle. This interim final rule should be sent to Mr. Brian Dahlin, (IFR) clarifies the meaning of these I. Public Participation and Request for Chief, Regulatory Analysis Division, existing definitional terms to ensure that Comments Federal Motor Carrier Safety the HOS exemptions are utilized as A. Submitting Comments Administration, 1200 New Jersey Congress intended. Avenue SE, Washington DC 20590. Any DATES: This IFR is effective December 9, If you submit a comment, please comments that FMCSA receives which 2020. You must submit comments on or include the docket number for this IFR are not specifically designated as CBI before December 24, 2020. (FMCSA–2018–0348), indicate the will be placed in the public docket for Petitions for Reconsideration of this specific section of this document to this rulemaking. IFR must be submitted to the FMCSA which your comment applies, and Administrator no later than December provide a reason for each suggestion or B. Viewing Comments and Documents 24, 2020. recommendation. You may submit your To view comments, as well as any ADDRESSES: You may submit comments comments and material online or by fax, documents mentioned in this preamble identified by docket number FMCSA– mail, or hand delivery, but please use as being available in the docket, go to 2018–0348 using any one of the only one of these means. FMCSA http://www.regulations.gov/ following methods: recommends that you include your #!docketDetail;D=FMCSA-2018-0348

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