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C   $X;XXX  21    _Inadditiontothesetwofactors,OTAGconsideredthree  otherfactorsinestablishingthegeographicresolution,  overallsize,andtheextentofthefinegrid.Theseother  factorsdealtwiththecomputerlimitationsandthe | resolutionofavailablemodelinputs.25+M 0_level8   pp x 23  ..  5+ ` hp x 5  22+M 0_level9    x 23  ..  5+ ` hp x 5  <6X9`(Courier New2JM 0_levsl1  X 2( ` hp x 223  Ԁ  5+ ` hp x 5  2GM 0_levsl2   /%` ` hp x /23  Ԁ  5+ ` hp x 5  2DM 0_levsl3   ," hp x ,23  Ԁ  5+ ` hp x 5  (ZEGMSY_ekqAutoList87A.A.A.A.A.A.A.A.A.www.epa.gov/ttnotag/otag/finalrpt/2AM 0_levsl4  ` ) hp x )23  Ԁ  5+ ` hp x 5  2>M 0_levsl5   &hhp x &23  Ԁ  5+ ` hp x 5  %2A`ArialTable_A2;M 0_levsl6   #p x #23  Ԁ  5+ ` hp x 5  28M 0_levsl7  h  p x 23  Ԁ  5+ ` hp x 5  (EGMSY_ekqAutoList451.1.1.1.1.1.1.1.(JEGMSY_ekqAutoList46A.A.A.A.A.A.A.A.25M 0_levsl8   pp x 23  Ԁ  5+ ` hp x 5  (%EGMSY_ekqAutoList891.1.1.1.1.1.1.1.22M 0_levsl9    x 23  Ԁ  5+ ` hp x 5  2JM 0_levnl1  X 2( ` hp x 223   5+ ` hp x 5  2GM 0_levnl2   /%` ` hp x /23   5+ ` hp x 5  2DM 0_levnl3   ," hp x ,23   5+ ` hp x 5  mailto:allman.joann@epa.gov.http://www.epa.gov/ttn/rto/whatsnew.htmlmailto:A-and-R-Docket@epa.gov.http://www.epa.gov/ttn/rto/        $X;XXX  24    _PursuanttothecourtsorderliftingthestayoftheSIP  submissionobligation,the20States,includingAlabamaand  Michigan,wererequiredtosubmitSIPsinresponsetothe  SIPCallbyOctober30,2000.Asdiscussedabove,in | lettersdatedApril11,2000toStateGovernors,weprovided jP thattheStatesthatremainedsubjecttotheSIPCallcould >$ choosetosubmitSIPsmeetingonlythePhaseIemissions   budgetforeachState.WithrespecttoAlabamaand   Michigan,wealsoprovidedthatAlabamaandMichigancould   choosetosubmitSIPsthataddressemissionsonlyinthe  t  finegridportionoftheState.2AM 0_levnl4  ` ) hp x )23   5+ ` hp x 5  2>M 0_levnl5   &hhp x &23   5+ ` hp x 5   $X;XXX  1    _October30,2000wasthefirstbusinessdayfollowingthe  expirationofthe128dayperiod.2;M 0_levnl6   #p x #23   5+ ` hp x 5  28M 0_levnl7  h  p x 23   5+ ` hp x 5  1.25M 0_levnl8   pp x 23   5+ ` hp x 5    $X;XXX  2    _\X;XXX;#X;XX\X;t#\X;XXX;ThePhaseIemissionsreductionsshouldachieve  approximately90percentofthetotalemissionsreductions  calledforbytheNOxSIPCall.#X;XX\X;#  $X;XXX  25    _ԀWeassumedthatsourcesinStatesaffectedundertheOTC e MOUandtheSection126actionwillinstallcontrolsbyMay 9 1,2003,butsourcesintheotherStatesaffectedbytheSIP   Call(Alabama,Illinois,SouthCarolina,Tennesseeand | portionsofIndiana,Kentucky,andMichigan)willhaveuntil P  May31,2004toinstallcontrols.Inthisaction,weare  proposingthatGeorgiaandMissouriwillhaveuntilMay1,  2005toinstallcontrols.Sourcesthatwillnothaveto  completeinstallationofcontrolsuntilMay31,2004 X| representapproximately40percentofthegeneration , P capacityintheSIPCallRegion.newtogether712.wpd  $9 ' jking0jking .   22M 0_levnl9    x 23   5+ ` hp x 5  (եEGMSY_ekqAutoList901.1.1.1.1.1.1.1. 8 $X;XXX  26    _Arkansas,Florida,Iowa,Kansas,Louisiana,Maine, e Minnesota,Mississippi,NorthDakota,Nebraska,New 9 Hampshire,Oklahoma,SouthDakota,Texas,Vermont.(zEGMSY_ekqAutoList61A.A.A.A.A.A.A.A.1.(EGMSY_ekqAutoList911.1.1.1.1.1.1.1. _ X;XXXInterstateOzoneTransport:Responseto#X8XXX;!#X;XXX8Court Decisions#X8XXX;#X;XXX8Ԁ H onthe NOxSIPCall,NOxSIPCallTechnicalAmendments,  (  #X8XXX;#X;XXX8andSection126Rules#X8XXX;#X;XXX8 Page151of151#X8XXX;#     `     h A.<4 9Z .Courier New Regular1.(EGMSY_ekqAutoList62A.A.A.A.A.A.A.A. _ (5H030eEGMSY_ekqAutoList921.a.1.1.1.1.1.1.A.1.(EEGMSY_ekqAutoList631.1.1.1.1.1.1.1.(EGOW_gowAutoList98(1)(1)(1)(1)(1)(1)(1)(1)1.(EGMSY_ekqAutoList941.1.1.1.1.1.1.1.(eEGMSY_ekqAutoList651.1.1.1.1.1.1.1.(EGMSY_ekqAutoList74A.A.A.A.A.A.A.A.1.  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A.(EGMSY_ekqAutoList68A.A.A.A.A.A.A.A.A.(EGMSY_ekqAutoList691.1.1.1.1.1.1.1.1.(UEGMSY_ekqAutoList701.1.1.1.1.1.1.1.(EGMSY_ekqAutoList66A.A.A.A.A.A.A.A.'gacounties &F1.A.(EGMSY_ekqAutoList75A.A.A.A.A.A.A.A.A.A.1.  e 1.mailto:grano.doug@epa.gov;9TABLE FI.(EGMSY_ekqAutoList531.1.1.1.1.1.1.1.i)(EGOW_gowAutoList95(1)(1)(1)(1)(1)(1)(1)(1)&(1)(1),A.-1..A.c1./A.1.A.1I.2A.41.5A.61.7A.(eEGMSY_ekqAutoList991.1.1.1.1.1.1.1.8I.61.0A.(EGMSY_ekqAutoList76I.I.I.I.I.I.I.I.:I.(EGMSY_ekqAutoList77A.A.A.A.A.A.A.A.TABLE BtTABLE ChzTABLE BTABLE CTABLE D e TABLE E<A.(եEGMSY_ekqAutoList781.1.1.1.1.1.1.1.K1.(EGMSY_ekqAutoList791.1.1.1.1.1.1.1.M1.(EGMSY_ekqAutoList80A.A.A.A.A.A.A.A.OA.(EGMSY_ekqAutoList81I.I.I.I.I.I.I.I.QI.( EGMSY_ekqAutoList82A.A.A.A.A.A.A.A.SA.(ťEGMSY_ekqAutoList83I.I.I.I.I.I.I.I.UI.(*EGMSY_ekqAutoList84A.A.A.A.A.A.A.A.WA.0ӨEGMU[agmsAutoList85A.(1)A.A.A.A.A.A.YA.(GIOU[agmsAutoList100A.A.A.A.A.A.A.A.<4 9Z .Courier New Regular $X;XXX  3    _ForIndiana,Kentucky,Michigan,andNewYork,onlysources  inportionsoftheStateareaffectedbythatrule.A.i),A.-1.(F$0  0` (#(#0 ` (#` (#0 (# (#0h(#(#0h(#h(#0(#(#0p(#(#2#     )3  0p(#p(# )bLevel 1Level 2Level 3Level 4Level 5(jEGMSY_ekqAutoList60A.A.A.A.A.A.A.A.eA.  $X;XXX  4    _TheSection126RuleusesthesamedefinitionofEGUsthat  we_ԀareproposingfortheNOxSIPCallintodaysaction.Level 1Level 2Level 3Level 4Level 5 % $X;XXX  6    _X;XXX;AmemodatedJanuary16,2002fromJohnSeitz,Director,  OfficeofAirQualityPlanningandStandardstotheEPA  RegionalAirDivisionDirectors,indicatedourintentto X resetthecompliancedateforEGUsandnonEGUstoMay31, ,| 2004,subjecttoourresponsetothegrowthfactorremand.#X;XXX;t#ԄLevel 1Level 2Level 3Level 4Level 5 $X;XXX  7    _Thenumberingofthestepsinthemethodologyisaddedfor  theconvenienceofthereader.i)Level 1Level 2Level 3Level 4Level 5[A.(GIQYaiqyAutoList101(1)(1)(1)(1)(1)(1)(1)(1)o(1) R $X;XXX  27    _X;XXX;NationalEnergyFoundationwebpage: H http://www.nef1.org/ea/eastats.html#X;XXX;u#X8XXX;݋XX8(GIOU[agmsAutoList103A.A.A.A.A.A.A.A. t $X;XXX  8    _ForpurposesoftheJanuary18,2000Section126final  rule,wedefined"electricityforsaleunderfirmcontract  totheelectricgrid"aswhere"thecapacityinvolvedis X intendedtobeavailableatalltimesduringtheperiod ,| coveredbytheguaranteedcommitmenttodeliver,evenunder P adverseconditions"(65FR2694and2731).Asdiscussed $ below,weproposetoadoptintodaysproposedrulethe   definitionforthetermprovidedintheJanuary18,2000 |  Section126finalrule.Thisdefinitionwasbasedon P  languagefromtheGlossaryofElectricUtilityTerms,Edison $ t  ElectricInstitute,PublicationNo.7040(definitionof  H  "firm"power).Generally,capacity"underfirmcontractto    theelectricitygrid"isincludedonEnergyInformation    Administration(EIA)form860A(calledEIAform860before i 1998)orisreportedascapacityprojectedforsummeror = winterpeakperiodsonEIAform411(Item2.1or2.2,line  10). | <  p`+"Courier NewTT r $X;XXX  9    _ForpurposesoftheJanuary18,2000Section126final  rule,weusedthemorefamiliarterm potentialelectrical   outputcapacity,ratherthantheterm usableenergy.We i defined potentialelectricaloutputusingthelong = standingdefinitionofthelattertermas 33percentofa  unitsmaximumdesignheatinput(65FR2694and2731).As | discussedbelow,weproposetoadoptintodaysproposed  P rulethesametermanddefinitionusedintheJanuary18,  $ 2000Section126finalrule. Potentialelectricaloutput a  capacityisused,anddefinedinthisway,inpart72of 5  theAcidRainProgramregulations(40CFR72.2and40CFR   part72,appendixD)andinthenewsourceperformance  t  standards(40CFR60.41a). H  (GIOU[agmsAutoList104A.A.A.A.A.A.A.A. X $X;XXX  10    _ԀInthepart96modelruleintheNOxSIPCall(63FR  57356,5751438)andsubsequentlyforpurposesofthe  January18,2000Section126finalrule(65FR2729and X 2731),weadoptedthelongstandingdefinitionof nameplate ,| capacityas themaximumelectricalgeneratingoutput(in P MWe)thatageneratorcansustainoveraspecifiedperiodof $ timewhennotrestrictedbyseasonalorotherderatingsas   measuredinaccordancewiththeUnitedStatesDepartmentof |  Energystandards.Asdiscussedbelow,weproposetoadopt P  intodaysproposedrulethesamedefinitionusedinthe $ t  January18,2000Section126finalrule.Thetermis  H  definedinthiswayinpart72oftheAcidRainProgram    regulations(40CFR72.2).   (EGMSY_ekqAutoList93a.a.a.a.a.a.a.a. a $X;XXX  11    _ԀInthepart96modelruleintheNOxSIPCall(63FR  57516)andsubsequentlyforpurposesoftheJanuary18,2000  Section126finalrule(65FR2729),wedefined maximum X designheatinputas theabilityofaunittocombusta ,| statedmaximumamountoffuelperhour(inmmBtu/hr)ona P steadystatebasis,asdeterminedbythephysicaldesignand $ physicalcharacteristicsoftheunit.Asdiscussedbelow,   weproposetoadoptintodaysproposedrulethesame |  definitionusedintheJanuary18,2000Section126final P  rule. $ t  za.(GIOU[agmsAutoList1051.1.1.1.1.1.1.1. 4 $X;XXX  15    _AlternativeControlTechniquesdocument, NOxEmissions  fromStationaryReciprocatingInternalCombustionEngines,  EPA453/R93032,July1993. " $X;XXX  16    _AlargeICengineisonethatemitted,onaverage,more  than1tonperdayduringthe1995ozoneseason(May1  throughSeptember30).(GIOU[agmsAutoList102A.A.A.A.A.A.A.A. n $X;XXX  17    _Thediscussioninthetextgenerallyuses grams/brake  horsepowerhourorg/bhphrratherthanlbs/mmBtusincethe  formeristheconventionfortheindustry.Theuncontrolled  estimateof3.0lbs/mmBtu(fromAP42,October1996) | correspondstoabout11.3g/bhphr.The1993ACTdocument jP forICenginesestimatesaverageuncontrolledemissionsat >$ 5.13lb/mmBtuor16.8g/bhphr.A. $X;XXX  18    _NOxSIPCallRuleat63FR57402.(GIOU[agmsAutoList1061.1.1.1.1.1.1.1.  $X;XXX  19    _ NOxEmissionsControlCostsforStationaryReciprocating  InternalCombustionEnginesintheNOxSIPCallStates  preparedbyPechanAvantiGroupforEPA,August11,2000;  annualcostsin1990dollarsperNOxtonsreducedinthe | ozoneseason.  $X;XXX  14    _ԀInfact,useoftheonethirdpotentialelectricaloutput  capacity/25MWesalescriteriaforcogeneratorswould  distinguishbetweenEGUcogeneratorsandnonEGU  cogeneratorsbasedonthecogeneratorsamountof | electricitysalesandwould_raisethe____same_Ԁ_issue._Ԁ_Under_ jP thesecriteria,twophysicallyidenticalcogeneratorscould >$ havedifferentemissionlimitssimplybecauseoneproduces   andsellstherequisiteamountofelectricityandtheother   produceselectricityforinternaluseanddoesnotsellthe   requisiteamount. N $X;XXX  20    _ NOxEmissionsControlCostsforStationaryReciprocating  InternalCombustionEnginesintheNOxSIPCallStates  preparedbyPechanAvantiGroupforEPA,August11,2000.(GIOU[agmsAutoList107A.A.A.A.A.A.A.A.I.i),A.-1..A.c1./A.1.A.1I.2A.41.5A.61.7A.8I.0A.(+GIOU[agmsAutoList108A.A.A.A.A.A.A.A.(XGIQYaiqyAutoList109(1)(1)(1)(1)(1)(1)(1)(1)  $X;XXX  22    _TheOTAGrecommendationonMajorModeling/AirQuality  ConclusionsapprovedbythePolicyGroup,June3,1997X;XXX;(#X;XXX;#X;XXX;62  FR60318,AppendixB#X;XXX;9#X;XXX;,November7,1997).#X;XXX;#  <4 9Z .Courier New Regular $X;XXX  23    _The2007BaseCaseincludesallcontrolmeasuresrequired  bytheCAA.  $X;XXX  13    _ԀWealsonotethatthedollarpertoncostforthis  installationis$2,800to$3,000pertonofNOxremoved.  ThisishigherthantheaveragecostforEGUsbecausethe  unitstartedatalowNOxrate(0.16lb/mmBtu)andcontrols | downto0.070.08lb/mmBtu,notbecausetheunitisa jP cogenerator.Iftheunitonlygeneratedelectricityandhad >$ thesamestartingNOxrate,thecostwouldbethesame. | $X;XXX  12    _ԀX;XXX;Thesetwoconfigurationsareforcogenerationunitsin e toppingcyclecogenerationfacilities,whereenergyisused 9 sequentiallyfirsttoproduceelectricityandthento   producethermalenergyforprocessuseorheatingand | cooling.Inbottomingcyclecogenerationfacilities,energy P isusedsequentiallyfirsttoproducethermalenergyand $ thentoproduceelectricity.(S#X;XXX;v#X;XXX;eeCogenerationApplications ]  Considerations,R.W.FiskandR.L.VanHousen,GEPower =  Systems,1996,Docket#A9656,item#XIIL04#X;XXX;#X;XXX;Ԁat12.)   Thecogenerationunitssubjecttothe#X;XXX;#X;XXX;NOxSIPCallandthe    Section126Rule#X;XXX;#X;XXX;Ԁareboilers,turbines,orcombinedcycle  `  systemsandsoarelikelytooperateintoppingcycle  4  cogenerationfacilities.#X;XXX;#i)A.(GIQYaiqyAutoList110(1)(1)(1)(1)(1)(1)(1)(1)   (JEGMSY_ekqAutoList86A.A.A.A.A.A.A.A. J $X;XXX  5    _Asdiscussedinthenextsection,onAugust24,2001,the  D.C.CircuitsuspendedthecompliancedateforEGUswhilewe  resolvearemandedissuerelatedtoEGUgrowthfactors.mailto:A-and-R-docket@epa.gov   (5EGMSY_ekqAutoList961.1.1.1.1.1.1.1.1.(EGOW_gowAutoList97(1)(1)(1)(1)(1)(1)(1)(1)(1)(GIOU[agmsAutoList111A.A.A.A.A.A.A.A.A. !  _8;XXdd8X;XXXQRQR OY/P#,&W"O:p FA0.V `     h 󀀀XXXX;0  0(#(#0p(#(#656050P#X;XXXޖ#Ԁ ' Ѐ p(#p(#  @-   ENVIRONMENTALPROTECTIONAGENCY  40CFRParts51,52,96,and97 g @ [FRLXXXXX] '  X;XXX;InterstateOzoneTransport:Responseto#X;XXX;"#Court DecisionsX;XXX;Ԁ    onthe NOxSIPCall,NOxSIPCallTechnicalAmendments,     #X;XXX;#andSection126RulesX;XXX;     AGENCY : EnvironmentalProtectionAgency(EPA). g@   ACTION:0 Proposedrule.  (# (#  `     h    SUMMARY : Intodaysaction,weareproposingtoamendtwo  relatedfinalrulesweissuedundersections110and126of h theCleanAirAct(CAA)relatedtointerstatetransportof 7 nitrogenoxides(NOx),oneofthemainprecursorstoground  levelozone.Wearerespondingtothe#X;XXX;g#March3,2000X;XXX; ` decisionoftheUnitedStatesCourtofAppealsforthe / DistrictofColumbiaCircuit(D.C.Circuit)inwhichthe  CourtlargelyupheldtheNOxStateImplementationPlanCall  X (NOxSIPCall),butremandedfournarrowissuestousfor '"! furtherrulemakingaction;#X;XXX;8#ԀtherelateddecisionbytheD.C. ## CircuitonJune8,2001,concerningtherulemakings w%P% providingtechnicalamendmentstotheNOxSIPCall,inwhich ' ' theCourt,amongotherthings, vacatedandremandedanissue (") forfurtherrulemaking;andthedecisionbytheD.C.Circuit o*H$+ onMay15,2001,concerningtherelated,section126 ,%- rulemaking,inwhichtheCourt,amongotherthings,vacated ' andremandedanissueforfurtherrulemaking;andthe  relateddecisionbytheD.C.CircuitonAugust24,2001, w P concerningtheSection126Rule,inwhichtheCourtremanded   anissue.    ` InthefinalNOxSIPCall,wefoundthatemissionsof oH  NOxfrom22StatesandtheDistrictofColumbia(23States)   significantlycontributetodownwindareasnonattainmentof   the1hourozonenationalambientairqualitystandards g@  (NAAQS).WeestablishedstatewideNOxX;XXX;emissionsbudgetsfor  theaffectedStates.#X;XXX;d #:X;XXX;Inrulemakingsprovidingtechnical  amendmentstotheNOxSIPCallbudgets,werevisedthose _8 budgets.#X;XX:X; #X;XXX;Todaysactionaddressestheissuesremandedby  theCourt#X;XXX;#:X;XXX;inthetwocasesinvolvingchallengestoboththe  NOxSIPCallandtherulemakingsprovidingtechnical W0 amendments#X;XX:X;I#X;XXX;Ԁfornoticeandcommentrulemakingandproposes  relatedamendments.#X;XXX;$#    :X;XXX; ` Intodaysaction,wearealsorespondingtotheD.C. O"(" Circuitsdecisionsinathirdcaseconcerningarelated #$ rulemaking,theSection126Rule,inwhichtheCourt %x& remandedanissue#X;XX:X;#:X;XXX;Ԁandvacatedanissue.Thisaction G' !( addressesthevacated#X;XX:X;#:X;XXX;Ԁissue.#X;XX:X;# ("*  DATES :Commentsmustbepostmarked,faxed,oremailedby *p$, April15,2002.Apublichearing,ifrequested,willbe W,0&. heldinWashington,D.C.onf  March15g ,2002beginningat9:00 ' am.    ADDRESSES :Comments(induplicateifpossible)maybe w P submittedtotheOfficeofAirandRadiationDocketand 7  InformationCenter(6102),Attention:DocketNo.A9656,   U.S.EnvironmentalProtectionAgency,401MStreet,SW, `  Washington,DC20460,telephone(202)2607548,fax(202) /  2604400,andemail4 TO  5  AandRdocket@epa.gov6TO  7 0.Weencourage   electronicsubmissionsofcommentsanddatafollowingthe X  instructionsunderSUPPLEMENTARYINFORMATIONofthis ' document.Noconfidentialbusinessinformation(CBI)should  besubmittedthroughe-mail. wP  ` Thepublichearing,ifrequested,willbeheldatX;XXX;f  g f    CrystalMall2(Room1110;the fishbowl),CrystalCity,  1921JeffersonDavisHwy,Arlington,VA22202f  g .#X;XXX;#Ԁ oH  ` Documentsrelevanttothisactionareavailablefor  inspectionattheU.S.EnvironmentalProtectionAgency,401    MStreet,SW,WatersideMall,RoomM1500,Washington,DC g"@" 20460,betweeng f  8:00f  g Ԁa.m.and5:30p.m.,Mondaythrough $$ Friday,excludinglegalholidays.Areasonablefeemaybe %& chargedforcopying. _'8!(  FORFURTHERINFORMATIONCONTACT :Generalquestions )"* concerningtoday'sactionshouldbeaddressedtoJanKing, *$, OfficeofAirQualityPlanningandStandards,AirQuality o,H&. StrategiesandStandardsDivision,C53902,Research ' TrianglePark,NC,27711,telephone(919)5415665,email  at4 pTO  5  king.jan@epa.gov.6TO  7 hԀ X;XXX;TechnicalquestionsconcerningEGUsin w P todaysdocumentshouldbedirectedtoKevinCulligan,   OfficeofAtmosphericPrograms,CleanAirMarketsDivision,   (6204M),1200PennsylvaniaAve.,NW,Washington,DC20460, oH  telephone(202)5649172,email4 TO  5  culligan.kevin@epa.gov6TO  7 ;   technicalquestionsconcerninginternalcombustionengines   shouldbedirectedtoDougGrano,OfficeofAirQuality g@  PlanningandStandards,C53902,ResearchTrianglePark,  NorthCarolina27711,telephone(919)5413292,email  4 TO  5  grano.doug@epa.gov;6 TO cume  7s Ԁlegalquestionsshouldbedirectedto _8 HowardJ.Hoffman,OfficeofGeneralCounsel,(2344A),1200  PennsylvaniaAve.,NW,Washington,DC20460,telephone(202)  5645582,email4 TO  5  hoffman.howard@epa.gov.6R"TOf"  7 "Ԁ#X;XXX;B#  W0 SUPPLEMENTARYINFORMATION :   ` Todaysactionaddressestheissuesremandedorvacated    fornoticeandcommentrulemakingbytheD.C.Circuitin g"@" Michiganv.EPA,213F.3d663(D.C.Cir.2000),cert. $$ denied,121S.Ct.1225,149L.ED.135(2001), which %& concernedtheNOxSIPCall(the SIPcallcase); _'8!( AppalachianPowerv.EPA,251F.3d1026(D.C.Cir.2001), )"* whichconcernedthetechnicalamendmentsrulemakingsforthe *$, NOxSIPCall(the TechnicalAmendmentscase);and W,0&. AppalachianPowerv.EPA,249F.3d1042(D.C.Cir.2001)and ' AppalachianPowerv.EPA,No.991200,Order(D.C.Cir.,  August24,2001),whichconcernedthesection126rulemaking w P (the Section126case).    ` Inthisaction,weareproposingto:   (1)0 ` retainthedefinitionofEGUsasitrelatesto oH  cogenerationunitsintheNOxSIPCallandinthe   Section126Rule,andretainthedefinitionofEGUsas   itrelatestocogenerationunitsintheNOxSIPCall g@  withonlyminorrevisionstomakethedefinition  consistentwiththeSection126Rule.` (#` (# (2)0 ` revisethecontrollevelsforstationaryinternal _8 combustionenginesthatwereassumedincalculatingNOx  SIPcallbudgetsforeachState,` (#` (# (3)0 ` excludeportionsofGeorgia,Missouri,Alabamaand W0 MichiganfromtheNOxSIPCall(thecourtruling  focusedonGeorgiaandMissouri,butthesameissueis    relevanttoAlabamaandMichigan),O"("` (#` (# (4)0 ` revisestatewideemissionsbudgetsintheNOxSIPCall #$ toreflectthedispositionofthefirstthreeissues %x& above,G' !(` (#` (# (5)0 ` setarangeofdatesfor19StatesandtheDistrictof ("* ColumbiatosubmitStateimplementationplansto *p$, achievetheemissionsreductionsrequiredbythis ?,&. P#    secondphaseoftheNOxSIPCall,andforGeorgiaand  MissouritosubmitSIPsmeetingthefullNOxSIPCall:  6monthsthrough1yearfromfinalpromulgationofthis n P rulemakingbutnolaterthanApril1,2003, ` (#` (# (6)0 ` setacompliancedateofMay31,2004,forallsources   exceptthoseinGeorgiaandMissouri;andsourcesin fH  thosetwoStateswouldhaveaMay1,2005compliance   date, ` (#` (# (7)0 ` excludeWisconsinfromNOxSIPCallrequirements.^@ ` (#` (#  ` Groundlevelozonehaslongbeenrecognizedtoaffect  publichealth.Ozoneinduceshealtheffects,including  decreasedlungfunction(primarilyinchildrenactive V8 outdoors),increasedrespiratorysymptoms(particularlyin  highlysensitiveindividuals),increasedhospitaladmissions  andemergencyroomvisitsforrespiratorycauses(among N0 childrenandadultswithpreexistingrespiratorydisease  suchasasthma),increasedinflammationofthelungs,and    possiblelongtermdamagetothelungs. F"("  PublicHearing  #$  ` Apublichearing,ifrequested,willbeheldonf  g f  g ԀMarch %& 15f  g ,2002beginningat9:00am.Thehearingwillbeheldat V'8!( CrystalMall2(Room1110,the fishbowl),CrystalCity, ("* 1921JeffersonDavisHwy,Arlington,VA22202.f  g ԀThemetro *$, stopisX;XXX;f  g f  g CrystalCityf  g ,whichisg locatedabout1blocksfrom N,0&. CrystalMall2#X;XXX;G4#f  g .Ifyouwishtorequestahearingand  presentoraltestimonyorattendthehearing,youshould  notify,onorbeforef  g f  g ԀMarch7f  g ,2002,Ms.JoAnnAllman , Office n P ofAirQualityPlanningandStandards,AirQuality .  StrategiesandStandardsDivision,C53902,Research     TrianglePark,NC27711,telephone(919)5411815,email ~`  4 %TO  5  allman.joann@epa.gov.6D7TOX7  7 f!7ԀOraltestimonywillbelimitedto5 &  minuteseach.Thehearingwillbestrictlylimitedtothe   subjectmatteroftheproposal,thescopeofwhichis vX  discussedbelow.Anymemberofthepublicmayfilea  writtenstatementbythecloseofthecommentperiod.  Writtenstatements(duplicatecopiespreferred)shouldbe nP submittedtoDocketNo.A9656and,totheextentthey  concerntheSection126Rule,DocketNo.A9743,atthe  addresslistedaboveforsubmittingcomments.Thehearing fH schedule,includinglistsofspeakers,willbepostedon  EPAswebpageat4 TO  5  http://www.epa.gov/ttn/rto/whatsnew.html6:TO;  7 ?;.    Averbatimtranscriptofthehearingandwrittenstatements ^"@" willbemadeavailableforcopyingduringnormalworking $$ hoursattheOfficeofAirandRadiationDocketand %& InformationCenterattheaboveaddresslistedfor V'8!( inspectionofdocuments. ("*  ` Ifnorequestsforapublichearingarereceivedby *$, closeofbusinessMarch7,2002,thehearingwillbe N,0&. cancelled.Thecancellationwillbeannouncedonthe  webpageattheaddressshownabove.   ElectronicAvailability  n P  ` Electroniccommentsareencouragedandcanbesent .  directlytoEPAat:4 ITO  5  AandRDocket@epa.gov6>TO ?  7 ;?.Electronic   commentsmustbesubmittedasanASCIIfileavoidingtheuse ~`  ofspecialcharactersandanyformofencryption.Comments &  anddatawillalsobeacceptedondisksinWordPerfectin   8.0fileformatorASCIIfileformat.Allcommentsanddata vX  inelectronicformmustbeidentifiedbythedocketnumber  A9656and,totheextenttheyconcerntheSection126  Rule,docketnumberA9743.Electroniccommentsonthis nP proposedrulemaybefiledonlineatmanyFederalDepository  Libraries.   AvailabilityofRelatedInformation  fH  ` TheofficialrecordsfortheNOxSIPCallrulemaking & (includingtheTechnicalAmendments)andfortheSection126    Rule,aswellasthepublicversionsoftherecords,have v"X" beenestablishedunderdocketnumbersA9656andA9743, $$ respectively(includingcommentsanddatasubmitted %& electronicallyasdescribedbelow).Wehaveaddednew n'P!( sectionstothosedocketsforpurposesoftodaysproposed )"* rulemaking.Thepublicversionoftheserecords,including *$, printed,paperversionsofelectroniccomments,whichdoes f,H&. notincludeanyinformationclaimedasCBI,areavailable  forinspectionfrom8:00a.m.to5:30p.m.,Mondaythrough  Friday,excludinglegalholidays.Therulemakingrecords n P arelocatedattheaddressinADDRESSESatthebeginningof   thisdocument.Inaddition,theFederalRegister   rulemakingsandassociateddocumentsarelocatedat fH  4 TO  5  http://www.epa.gov/ttn/rto/6CGTOWG  747G.   -,-  Outline     (5H03"3"  3H25H  I  .3  0 `   Background3HI݌vX ` (#` (# Ќ  ! ! (80"3"  3gJ2  A  .3  0 `   WhatWasContainedintheNOxSIPCall?3gJJ݌J,` (#` (# Ќ  "3"  3WK2  B  .3  0 `   WhatWeretheCourtDecisionsontheNOxSIPCall?3WKK݌` (#` (# Ќ  ! ! -(Uh88"3"  3L2Uh  1  .3  0 `   WhatWastheDecisionoftheCourtonthe8HourNAAQS?3L!M݌` (#` (# Ќ  "3"  3M2Uh  2  .3  0 `   WhatEffectDidTheCourtDecisionHaveonthe8Hour  PortionoftheNOxSIPCall?3M!N݌|` (#` (# Ќ  "3"  3)O2Uh  3  .3  0 `   WhatWastheD.C.CircuitDecisionontheStayofthe nP SIPSubmittalSchedulefortheNOxSIPCall?3)OVO݌B$` (#` (# Ќ  "3"  3hP2Uh  4  .3  0 `   WhatWastheCourtsDecisionontheNOxSIPCall?3hPP݌` (#` (# Ќ  "3"  3fQ2Uh  5  .3  0 `   HowDidtheCourtRespondtoEPAsRequesttoLiftthe  Stayofthe1HourSIPSubmissionSchedule?3fQQ݌` (#` (# Ќ  "3"  3R2Uh  6  .3  0 `   WhatWastheCourtsOrderfortheComplianceDate t Order?3RR݌fH` (#` (# Ќ   .(88-! !"3"  3dT2  C  .3  0 `   WhatWastheSection126Rule?3dTT݌:` (#` (# Ќ  ! ! c(ʽ88.1.0 ` WhatWastheD.C.CircuitDecisionontheSection126  Rule?` (#` (#  /(ڽ88c! !"3"  3 W2ڽ  D  .3  0 `   WhatWeretheTechnicalAmendmentsRulemakings?3 W8W݌  ` (#` (# Ќ  ! ! (h88/"3"  3X2h  1  .3  0 `   WhatWastheD.C.CircuitDecisionontheTechnical !l! Amendments?3XX݌^"@"` (#` (# Ќ   (88! !"3"  3cZ2  E  .3  0 `   WhatistheOverviewofD.C.CircuitRemands/Vacaturs?3cZZ݌2##` (#` (# Ќ  "3"  3b[2  F  .3  0 `   WhatisEPAsProcessforAddressingthe $$ Remands/Vacaturs?3b[[݌$%` (#` (# Ќ   :(88! !"3"  3]2  II  .3  0 `   WhatistheScopeofthisProposal?3]K]݌%&` (#` (# Ќ  ! ! x(88:"3"  3^2  A  .3  0 `   HowDoWeTreat_Cogenerators_ԀandNonAcidRainUnits?3^^݌&d '` (#` (# Ќ  ! ! ~(88x"3"  3n`2  1  .3  0 `   WhatistheHistoricalDefinitionofUtilityUnit?3n``݌V'8!(` (#` (# Ќ  "3"  3ia2  2  .3  0 `   WhatistheNOxSIPCallDefinitionofEGU?3iaa݌*( ")` (#` (# Ќ  "3"  3]b2  3  .3  0 `   WhatMinorRevisionsAreBeingMadetotheDefinition ("* ofEGUintheNOxSIPCallandtheSection126Rule?3]bb݌)#+` (#` (# Ќ  "3"  3c2  4  .3  0 `   WhatMethodologyAreWeUsingtoClassifyEGU/nonEGU *$, CogenerationUnits?3cc݌z+\%-` (#` (# Ќ  "3"  3d2  5  .3  0 `   WhatistheEffectonCogenerationUnitClassification N,0&. p  C   ofApplyingtheSameMethodologyAsUsedForOther  Units,RatherThantheOnethirdPotentialElectrical  OutputCapacity/25MWeSalesCriteria?3dd݌` (#` (# Ќ   5(J88~! !"3"  3}g2J  B  .3  0 `   WhatControlLevelisBeingProposedforStationary [| ReciprocatingInternalCombustion(IC)Engines?3}gg݌/ P` (#` (# Ќ  ! ! (885"3"  3_i2  1  .3  0 `   WhatControlLevelWasUsedintheNOxSIPCall?3_ii݌ $` (#` (# Ќ  "3"  3Xj2  2  .3  0 `   WhatWastheMarch3,2000CourtDecisionRegardingIC   Engines?3Xjj݌ ` (#` (# Ќ  "3"  3tk2  3  .3  0 `   WhatAretheEmissionsfromICEngines?3tkk݌ ` (#` (# Ќ  "3"  3dl2  4  .3  0 `   WhatControlTechnologiesAreAvailableForICEngines?3dll݌S t ` (#` (# Ќ  "3"  3dm2  5  .3  0 `   IsSCRAnAppropriateTechnologyForNaturalGasFired 'H  LeanBurnICEngines?3dmm݌ ` (#` (# Ќ  "3"  3n2  6  .3  0 `   IsLECTechnologyAppropriateForNaturalGasFired   LeanBurnICEngines?3nn݌ ` (#` (# Ќ  "3"  3o2  7  .3  0 `   WhatNOxSIPCallBudgetCalculationsAreWe w  Proposing?3oo݌Kl ` (#` (# Ќ   O(88! !"3"  3jq2  C  .3  0 `   WhatisOurResponsetotheCourtDecisiononGeorgia @  andMissouri?3jqq݌` (#` (# Ќ  "3"  3r2  D  .3  0 `   WhatAreWeProposingforAlabamaandMichiganinLight  oftheCourtDecisiononGeorgiaandMissouri?3rr݌` (#` (# Ќ  "3"  3s2  E  .3  0 `   WhatModificationsWillbeMadetotheNOxEmissions o Budgets?3ss݌Cd` (#` (# Ќ  "3"  3t2  F  .3  0 `   HowWilltheComplianceSupplementPoolsBeHandled?3tu݌8` (#` (# Ќ  "3"  3u2  G  .3  0 `   WilltheEGUBudgetChangesAffecttheStatesIncluded   intheThreeStateMemorandumofUnderstanding?3uv݌` (#` (# Ќ  "3"  3'w2  H  .3  0 `   HowDoestheTerm BudgetRelatetoConformity  Budgets?3'wTw݌g` (#` (# Ќ  "3"  3Bx2  I  .3  0 `   HowWillPartialStateTradingBeAdministered?3Bxox݌;\` (#` (# Ќ  "3 "  3:y2  J  .3  0 `   WhatSIPSubmittalDatesAreWeProposing?3:ygy݌0` (#` (# Ќ  "3 "  3-z2  K  .3  0 `   WhatComplianceDatesAreWeProposing?3-zZz݌` (#` (# Ќ  ! ! (88 O"3"  3{2  1  .3  0 `   WhatistheTechnicalFeasibilityoftheCompliance  Dates?3{{݌` (#` (# Ќ  "3"  3|2  2  .3  0 `   HowWillThisAffectElectricReliability?3|}݌_  ` (#` (# Ќ  ! ! (8 8"3 "  3k~2  L  .3  0 `   WhatAreWeProposingforWisconsin?3k~~݌3!T!` (#` (# Ќ   S( 88 "3"  32   A  .3  0 `   HowArethe8HourNAAQSRulesAffectedbyThisAction?3݌"("` (#` (# Ќ   U(ť88S! !"3"  3{2ť  III  .3  0 `   WhatAretheAdministrativeRequirements?3{݌"#` (#` (# Ќ  ! ! (+88U"3"  32+  A  .3  0 `   ExecutiveOrder12866:RegulatoryImpactAnalysis3>݌#$` (#` (# Ќ  "3"  3 2+  B  .3  0 `   ExecutiveOrder12898:EnvironmentalJustice3 8݌$%` (#` (# Ќ  "3"  32+  C  .3  0 `   ExecutiveOrder13045:ProtectionofChildrenfrom W%x& EnvironmentalHealthRisksandSafetyRisks3.݌+&L '` (#` (# Ќ  "3"  3<2+  D  .3  0 `   ExecutiveOrder13132:Federalism3<i݌& !(` (#` (# Ќ  "3"  3&2+  E  .3  0 `   ExecutiveOrder13175:ConsultationandCoordination '!) withIndianTribalGovernments3&S݌("*` (#` (# Ќ  "3"  3V2+  F  .3  0 `   ExecutiveOrder13211:ActionsConcerningRegulations {)#+ ThatSignificantlyAffectEnergySupply,Distribution, O*p$, orUse3V݌#+D%-` (#` (# Ќ  "3"  32+  G  .3  0 `   UnfundedMandatesReformAct3݌+&.` (#` (# Ќ  "3"  32+  H  .3  0 `   RegulatoryFlexibilityAct(RFA),asAmendedbythe  SmallBusinessRegulatoryEnforcementFairnessActof  1996(SBREFA)3̊݌` (#` (# Ќ  "3"  32+  I  .3  0 `   PaperworkReductionAct34݌[|` (#` (# Ќ  "3 "  32+  J  .3  0 `   NationalTechnologyTransferandAdvancementAct3݌/ P` (#` (# Ќ  _H I.Background     A.WhatWasContainedintheNOxSIPCall ?    ` BynoticedatedOctober27,1998(63FR57356),we Wx  tookfinalactiontoprohibitspecifiedamountsofemissions   ofoneofthemainprecursorsofgroundlevelozone,NOx,in   ordertoreduceozonetransportacrossStateboundariesin Op  theeasternhalfoftheUnitedStates.Basedonextensive  airqualitymodelingandanalyses,wefoundthatsourcesin  23StatesemitNOxinamountsthatsignificantlycontribute Gh tononattainmentofthe1hourozoneNAAQSindownwind  States.Wesetforthrequirementsforeachoftheaffected  upwindStatestosubmitSIPrevisionsprohibitingthose ?` amountsofNOxemissionswhichsignificantlycontributeto  downwindairqualityproblems.WeestablishedstatewideNOx    emissionsbudgetsfortheaffectedStates.Thebudgetswere 7"X" calculatedbyassumingtheemissionsreductionsthatwould #$ beachievedbyapplyingavailable,highlycosteffective %& controlstosourcecategoriesofNOx.Stateshavethe /'P!( flexibilitytoadopttheappropriatemixofcontrolsfor ("* theirStatetomeettheNOxemissionsreductions *$, requirementsoftheSIPCall.:X;XXX;Anumberofparties, ',H&. includingcertainStatesaswellasindustryandlabor  groups,challengedourNOxSIPCallRule.#X;XX:X; #   ` Independently,wealsofoundthatsourcesandemitting / P activitiesin23StatesemitNOxinamountsthat   significantlycontributetononattainmentofthe8hour   ozoneNAAQS.However,wehaveindefinitelystayedtheNOx 'H  SIPCallasitappliesforthepurposesofthe8hourNAAQS   (65FR56245,September18,2000). w   B.WhatWeretheCourtDecisions ontheNOxSIPCall?  @   1.WhatWastheDecisionoftheCourtonthe8HourNAAQS?    ` OnMay14,1999,theD.C.Circuitissuedanopinion  which,inrelevantparts,questionedtheconstitutionality Gh oftheCAAasappliedbyEPAinits1997revisionofthe  ozoneNAAQS.SeeAmericanTrucking_Assn_Ԁv.EPA,175F.3d  1027(D.C.Cir.,1999).TheCourtsrulingcurtailedour ?` abilitytorequireStatestocomplywithamorestringent  ozoneNAAQS.     ` OnOctober29,1999,theD.C.Circuitgrantedinpart 7"X" anddeniedinpartourrehearingrequest.AmericanTrucking #$ _Assn_Ԁv.EPA,194F.3d4(D.C.Cir.1999).InMay2000,the %& SupremeCourtgrantedourpetitionandcertainpetitioners /'P!( crosspetitionsofcertiorari.OnFebruary27,2001,the ("* SupremeCourthandeddownitsdecisioninWhitmanv. *$, AmericanTruckingAssociation,531U.S.457(2001).In ',H&. vacatingtheD.C.Circuitsholdingonthepoint,the  SupremeCourtheldthattheCAAwasnotunconstitutionalin  itsdelegationofauthorityforustopromulgatearevised / P ozoneNAAQS.ThecasewasremandedtotheD.C.Circuitto   considerchallengestotherevisedozoneNAAQSonother   grounds. 'H   (E88 ! !"3"  3:2E  2  .3  0 `   WhatEffectDidThisHaveOnthe8hourPortionofthe     NOxSIPCall? 3:j݌ ` (#` (# Ќ   ` Thelitigationcreateduncertaintywithrespecttoour Op  abilitytorelyuponthe8hourozonestandardsasan  alternativebasisfortheNOxSIPCall.Asaresult,we  stayedindefinitelythefindingsofsignificantcontribution Gh basedonthe8hourstandard,pendingfurtherdevelopments  intheNAAQSlitigation(65FR56245,September18,2000).  BecausetheNOxSIPCallRulewasbasedindependentlyonthe ?` 1hourstandards,astayofthefindingsbasedonthe8hour  standardshadnoeffectontheremedyrequiredbythe1998    NOxSIPCall.Thatis,thestaydoesnotaffectour 7"X" findingsbasedonthe1hourstandards. #$  3.WhatWastheD.C.CircuitDecisionontheStayofthe %& SIPSubmittalSchedulefortheNOxSIPCall?  G'h!(  ` TheNOxSIPCallRulerequiredStatestosubmitSIP )(#* revisionsbySeptember30,1999.StatePetitioners *$, challengingtheNOxSIPCallfiledamotionrequestingthe W,x&. CourttostaythesubmissionscheduleuntilApril27,2000.  Inresponse,theD.C.CircuitissuedastayoftheSIP  submissiondeadlinependingfurtherorderoftheCourt. / P Michiganv.EPA,213F.3d663(D.C.Cir.2000)(May25,1999   ordergrantingstayinpart).    4.WhatWastheCourtsDecisionontheNOxSIPCall?  'H  :X;XXX; ) !#$%'((Ax8 ` #X;XX:X; #:X;XXX;OnMarch3,2000,theD.C.Circuit#X;XX:X;ܦ#issueditsdecision   ontheNOxSIPCall,rulinginourfavorontheissuesthat   affectedtherulemakingasawhole,butrulingagainstuson 7X  severalgeographicandproceduralissues.Michiganv.EPA,  213F.3d663(D.C.Cir.2000).TheCourtsdecisionin  Michiganv.EPA,213F.3d663(D.C.Cir.2000)concernsonly /P the1hourbasisfortheNOxSIPCall,andnotthe8hour  basis. TherequirementsoftheNOxSIPCall,includingthe  findingsofsignificantcontributionbythe23States,the 'H emissionsreductionsthatmustbeachieved,andthe  requirementforStatestosubmitSIPsmeetingstatewideNOx w   emissionsreductionsrequirements,arefullyand "@" independentlysupportedbyourfindingsunderthe1hour #$ NAAQSalone.TheCourtdeniedpetitionersrequestsfor o%& rehearingorrehearingenbanc onJuly22,2000. '8!( Specifically,theCourtfoundinourfavoronthefollowing ("* claims: *$, ! ! (8x) !#$%'("3"   ` 32(  1  )3  0   wecouldcallfortheSIPrevisionswithout ',H&. conveningatransportcommission;3݌ (# (# Ќ   (88"3"   ` 32(  2  )3  0   weundertookasufficientlyState-specific  determinationofozonecontribution;3֮݌/ P (# (# Ќ   (88"3"   ` 3W2(  3  )3  0   wedidnotunlawfullyoverridepastprecedent   regarding"significant"contribution;3W݌  (# (# Ќ   (G88"3"   ` 32G(  4  )3  0   ourconsiderationofthecostofNOxreductionas 'H  partofthedeterminationofsignificant   contributionisconsistentwiththestatuteand w  judicialprecedent;3N݌@  (# (# Ќ   (708! !" ;"   ;g0 ` 27(  5  )3  0 ` (#` (#  ourschemeofuniformemissionsreductions  requirementsisreasonable; ;g݌o (# (# Ќ  " ;"   ;0 ` 27(  6  )3  0 ` (#` (#  CAAsection110(a)(2)(D)(i)(I)asconstruedbyus 8 doesnotviolatethenondelegationdoctrine; ;̵݌ (# (# Ќ   (80" ;"   ;p0 ` 2(  7  )3  0 ` (#` (#  wedidnotintrudeonthestatutoryrightsof g StatestofashiontheirSIPs; ;p݌0 (# (# Ќ   (88" ;"   ;.0 ` 2(  8  )3  0 ` (#` (#  weproperlyincludedSouthCarolinaintheSIP  Call;and ;.[݌_   (# (# Ќ   (88" ;"   ;ٺ0 ` 2(  9  )3  0 ` (#` (#  wedidnotviolatetheRegulatoryFlexibilityAct. ;ٺ݌"(" (# (# Ќ   ` However,theCourtruledagainstusonfourspecific #$ issues.Specifically,theCourt: W%x& !  ! (88 "3"   ` 32(  1  )3  0   remandedandvacatedtheinclusionofWisconsin & !( becauseemissionsfromWisconsindidnotshowa ("* significantcontributiontodownwindnonattainment O*p$, oftheNAAQS;3P݌+&. (# (# Ќ   (88"3"   ` 3J2(  2  )3  0   remandedandvacatedtheinclusionofGeorgiaand  MissouriinlightoftheOzoneTransport  AssessmentGroup(OTAG)conclusionsthatemissions / P fromcoarsegridportionsdidnotmeritcontrols;3J݌  (# (# Ќ   (88"3"   ` 32(  3  )3  0   heldthatwefailedtoprovideadequatenoticeof   thechangeinthedefinitionofEGUasappliedto 'H  cogenerationunitsthatsellelectricitytothe   gridinamountsofeitheronethirdorlessof w  theirpotentialelectricaloutputcapacityor25 @  megawattsorlessperyear(smallcogenerators);  and3݌o (# (# Ќ  "3"   ` 32(  4  )3  0   heldthatwefailedtoprovideadequatenoticeof 8 thechangeincontrollevelassumedforlarge  stationaryinternalcombustionengines.3K݌g (# (# Ќ  TheCourtremandedthelasttwomattersforfurther 0 rulemaking.  ! ! z(u88 5.HowDidtheCourtRespondtoEPAsRequesttoLiftthe _   Stayofthe1HourSIPSubmissionSchedule?  "@"  ` OnApril11,2000,wefiledamotionwiththeCourtto #$ liftthestayoftheSIPsubmissiondate.Werequestedthat %& theCourtliftthestayasofApril27,2000.We /'P!( recognized,however,thatatthetimethestaywasissued, ("* Stateshadapproximately4months(128days)remainingto *$, submitSIPs.Therefore,ourmotiontoliftthestay ',H&. indicatedthatwewouldallowStatesuntilSeptember1,2000  tosubmitSIPsaddressingtheSIPCallandprovidedthat  StatescouldsubmitonlythoseportionsoftheSIPCall / P upheldbytheCourt(PhaseISIPs).Theexistingrecordin   theNOxSIPCallrulemakingprovidesabreakdownofthedata   onwhichtheoriginalbudgetsweredevelopedsufficientto 'H  allowStatestodevelopPhaseISIPs.However,wereviewed   therecordandfortheconvenienceoftheStatesandin w  letterstotheStateGovernorsandStateAirDirectors, @  datedApril11,2000,weidentifiedanadjustedPhaseINOx  budgetforeachStateforwhichtheSIPCallapplies. o  ` OnJune22,2000,theCourtgrantedourrequestin 8 part.TheCourtorderedthatweallowtheStates128days  fromtheJune22,2000dateoftheordertosubmittheir g SIPs.Therefore,SIPsinresponsetotheNOxSIPCallwere 0 dueOctober30,2000. X;XXX;  1      ׀   ` Inourmotiontoliftthestay,weinformedtheCourt _   thattheAgencyasked19StatesandtheDistrictof "(" Columbia,inletterstotheGovernorsdatedApril11,2000, #$ tosubmitSIPssubjecttotheCourtsresponsetoourmotion W%x& toliftthestay.The19Statesare:Alabama,Connecticut, & !( Delaware,Illinois,Indiana,Kentucky,Massachusetts, ("* Maryland,Michigan,NorthCarolina,NewJersey,NewYork,  Ohio,Pennsylvania,RhodeIsland,SouthCarolina,Tennessee,  VirginiaandWestVirginia.RatherthansubmitaSIPthat / P fullymeetstheNOxSIPCall,these19Statesandthe   DistrictofColumbiamaychoosetosubmitSIPsthatcover   alloftheNOxSIPCallrequirementsexceptforasmallpart 'H  oftheEGUportionandlargeinternalcombustionengine   portionofthebudget.Werefertothesepartialplansthat w  addresstheportionoftheruleunaffectedbytheCourts @  remandasthe PhaseISIPs. X;XXX;  2      ׀BecausetheSIPCallwas  vacatedwithrespecttoGeorgia,Missouri,andWisconsin, o thoseStateswerenotobligatedtosubmitanySIPsby 8 October30,2000.TheSIPsthatcovertheportionofthe  ruleaffectedbytheCourtdecision!andthesubjectof g todaysaction!aretermed,the PhaseIISIPs. 0  6.0 ` WhatWastheCourtsOrderfortheComplianceDate ?` (#` (#  ` OnAugust30,2000,theD.C.Circuitorderedthatthe w   courtorderfiledonJune22,2000beamendedtoextendthe "@" deadlineforfullimplementationoftheNOxSIPCallfrom #$ May1,2003toMay31,2004.Thisextensionwascalculated o%& inthesamemannerusedbytheCourtinextendingthe '8!( deadlineforSIPsubmissions,sothatsourcesinStates  subjecttotheNOxSIPCallwouldhave1,309daysfor  implementingtheSIPasprovidedintheoriginalNOxSIP / P Call.Thisactionwasinresponsetoamotionfiledbythe   industry/laborpetitioners.    <(08z C.0 ` WhatWastheSection126Rule? 0` (#` (#'H (#(#  (e80< ` WehavealsoaddressedinterstateNOxtransportina   finalrule(Section126Rule)thatrespondstopetitions   submittedbyeightNortheastStatesundersection126ofthe 7X  CAA(65FR2674,January18,2000)(theSection126Rule).  Inthisrule,wemadefindingsthat392sourcesin12States  andtheDistrictofColumbiaaresignificantlycontributing /P to1hourozonenonattainmentproblemsinthepetitioning  StatesofConnecticut,Massachusetts,NewYork,and  Pennsylvania.TheupwindStateswithsourcesaffectedby 'H theSection126Ruleare:Delaware,Indiana,Kentucky,  Maryland,Michigan,NorthCarolina,NewJersey,NewYork, w   Ohio,Pennsylvania,Virginia,WestVirginia,andthe "@" DistrictofColumbia.] XXXX;XXXXXXXXX;XXX  3      ׀Thetypesofsourcesaffectedare #$ largeEGUsg8 XXXX;XXXXXXXXX;XXX  4      ׀andlargeindustrialboilersandturbines(non o%& - C   EGUs).TheruleestablishedFederalNOxemissionslimits r fortheaffectedsourcesandsetaMay1,2003compliance  date. X;XXX;  5      ׀WepromulgatedaNOxcapandtradeprogramasthe  P controlremedy.AllofthesourcesaffectedbythisSection j  126RulearelocatedinStatesthataresubjecttotheNOx   SIPCall. H   ` TheSection126Ruleincludesaprovisiontocoordinate b  theSection126RulewithStateactionsundertheNOxSIP    Call.ThisprovisionautomaticallywithdrawstheSection @  126findingsandcontrolrequirementsforsourcesinaState Z iftheStatesubmits,andwegivefinalapprovalto,aSIP  revisionmeetingthefullNOxSIPCallrequirements, 8 includingtheoriginallypromulgatedMay1,2003compliance R deadline(40CFR52.34(i)).WhiletheCourthaschangedthe  NOxSIPCallcompliancedeadlinetoMay31,2004,we 0 promulgatedandjustifiedtheautomaticwithdrawalprovision J basedonapprovalofaSIPwithaMay1,2003compliance    date(64FR2827476,May25,1999;65FR26792684,January "(" 18,2000).Thus,theautomaticwithdrawalprovisioninthe B$$ Section126Ruledoesnotaddressanyothercircumstances. %x& AdditionalissuesregardingtheinteractionoftheSection ' !( QR 8;XXdXXd8   126RuleandSIPsundertheNOxSIPCallmaybeaddressed r throughfuturerulemaking._i X;XXX;  6      _Ԁ  :X;XXX; 1.WhatWastheD.C.CircuitDecisionontheSection126  P Rule?    #X;XX:X;l#:X;XXX; ` OnMay15,2001,apaneloftheD.C.Circuitlargely B  upheldtheSection126RuleinAppalachianPowerv.EPA,249 x  F.3d1032(2001).(AppalachianPower!Section126).   However,theCourtremandedtousthemethodfordetermining :  growthtotheyear2007inheatinpututilizationbyEGUs. p  Thiscalculationisimportantfordeterminingthe  requirementsforEGUs.Inaddition,theCourtvacatedand 2 remandedtoustheportionoftheruleclassifyingas#X;XX:X;#:X;XXX;EGUs h smallcogenerators(cogenerationunitsthatsellelectricity  tothegridinamountsofeitheronethirdorlessoftheir * potentialelectricaloutputcapacityor25megawattsorless ` peryear).Althoughin#X;XX:X;#theMichigandecision(concerning z theNOxSIPCallrulemaking),theD.C.Circuitremandedthis "!  issueontheproceduralgroundofinadequatenotice,inthe "X" AppalachianPower!Section126decision,theCourtvacated r$$ andremandedongroundsthatwedidnotjustifyour && QR 8;XXdXXd8   classificationofsmall_cogenerators_ԀasEGUs.Inanorder r datedOnAugust24,2001,theD.C.Circuitissuedanorder  intheAppalachianPower!Section126:X;XXX;ԀCase,remandingthe  P Section126Rulewithregardtotheclassificationofany j  cogeneratorsasEGUsandtolling(suspending)thedatefor   EGUstoimplementcontrolspendingEPAsresolutionofthe H  EGUgrowthfactorremand.#X;XX:X;#:X;XXX; b   ` DuringthecourseofthelitigationontheSection126    Rule,individualsourcesorgroupsofsourceschallengedthe @  ruleongroundsthatourallocationsofallowanceswere Z improper.Wesettledthesecaseswithseveralofthose  sources#X;XX:X;|#:X;XXX;Ԁwithouragreementtoproposearulemakingrevising 8 theallocations.#X;XX:X; #:X;XXX; R  D.0 ` WhatWeretheTechnicalAmendmentsRulemakings? ` (#` (#  ` WhenwepromulgatedtheNOxSIPCallRule,wedecided H toreopenpubliccommentonthesourcespecificdatausedto b establisheachStates2007EGUbudget(63FR57427,October  !  28,1998).Weextendedthiscommentperiodbynoticedated "@" December24,1998(63FR71220).Weindicatedthatwewould Z$$ entertainrequeststocorrectthe2007EGUbudgetstotake && intoaccounterrorsorupdatesinsomeoftheunderlying '8!( emissionsinventoryandcertainotherspecifieddata. R)"*  ` Followingourreviewofthecommentsreceived,we *$, publishedarulemakingprovidingTechnicalAmendmentsto, r amongotherthings,the2007EGUbudgets(64FR26298,May  14,1999).Inresponsetoadditionalcommentsreceived,we  P publishedasecondrulemaking,makingadditionalTechnical j  Amendmentstothe2007EGUbudgets(65FR11222,March2,   2000).(Thesetworulemakingsmaybereferredto,together, H  astheTechnicalAmendmentsRule.)Inpromulgatingthe b  TechnicalAmendmentsRule,wekeptintactourmethodfor    determiningthebudgets,includingthemethodsfor @  determininggrowthto2007.Wesimplymadeadjustmentsfor Z particularsources#X;XX:X;#:X;XXX;ԀconcerningwhethertheywerelargeEGUs  ornonEGUs,andadjustmentsintheappropriatebaselines 8 forthosesources. R  1.WhatWastheD.C.CircuitDecisionontheTechnical  Amendments?  H  ` OnJune8,2001,theD.C.Circuitissueditsopinionin z acaseinvolvingtheTechnicalAmendments.Appalachian "!  Powerv.EPA,251F.3d1026(D.C.Cir.2001).(Appalachian "X" Power!TechnicalAmendments).Althoughlargelyupholdingthe r$$ TechnicalAmendments,thecourt,asintheAppalachian && Power!Section126case,remandedtheEGUgrowthfactorsand 'P!( vacatedandremandedtheportionoftheruleclassifying j)"* smallcogeneratorsasEGUs.Inaddition,intheAppalachian +$, PowerTechnicalAmendmentsdecision,theCourtremandedand r vacatedthebudgetundertheTechnicalAmendmentsRulefor  Missouriunderboththe1hourand8hourozoneNAAQS.#X;XX:X;l#:X;XXX;  P  #X;XX:X;B#:X;XXX;E.WhatistheOverviewofD.C.CircuitRemands/Vacaturs?#X;XX:X;#:X;XXX;  j   ` Insummary,theD.C.Circuitdecisionsdescribedabove *  revisedorremanded/vacatedportionsoftheNOxSIPCall, `  Section126,andTechnicalAmendmentsrulemakingsas z  follows:#X;XX:X;#:X;XXX; "   (X88"3"  32X(  1  )3  0 `   remandedtheportionoftheNOxSIPCallrequirements X  basedontheassumedcontrollevelforstationary r internalcombustionengines;3K݌` (#` (# Ќ  "3"  32X(  2  )3  0 `   delayedtheNOxSIPCallSIPsubmittaldatetoOctober P 30,2000.Michigan(NOxSIPCall);3݌j` (#` (# Ќ  "3"  32X(  3  )3  0 `   delayedthedateforimplementationoftheNOxSIPCall  reductionstoMay31,2004.Michigan;3݌H` (#` (# Ќ  "3"  3 2X(  4  )3  0 `   remandedandvacatedtheinclusionofWisconsin. b Michigan;3 :݌ ! ` (#` (# Ќ  "3"  3,2X(  5  )3  0 `   remandedandvacatedtheNOxSIPCallbudgetsfor "@" GeorgiaandMissouriunderthe1hourozoneNAAQS. Z$$ Michigan;3,Y݌&&` (#` (# Ќ  "3"  32X(  6  )3  0 `   remandedandvacatedtheNOxSIPCallbudget,as '8!( revisedbytheTechnicalAmendments,forMissouri, R)"* underthe1hourand8hourozoneNAAQS.Appalachian *$, Power!TechnicalAmendments;3݌r` (#` (# Ќ  "3"  3W 2X(  7  )3  0 `   remandedtheEGUgrowthformula.Appalachian  Power!Section126,AppalachianPower!Technical  P Amendments;3W  ݌j ` (#` (# Ќ  "3"  3 2X(  8  )3  0 `   remanded,orremandedandvacated,theclassification   ofsmallcogeneratorsasEGUS.Michigan,Appalachian H  PowerSection126,AppalachianPower!Technical b  Amendments;and3  ݌  ` (#` (# Ќ  "3"  3 2X(  9  )3  0 `   remandedtheclassificationofanycogeneratorsas @  EGUs.AppalachianPowerSection126#X;XX:X;i#:X;XXX;.#X;XX:X;#:X;XXX;3  ݌Z` (#` (# Ќ  #X;XX:X;# (88 ! ! :X;XXX;F.WhatisOurProcessforAddressingtheRemands/  Vacaturs? #X;XX:X;#:X;XXX; P  ` Todate,wehaverespondedtothesedecisionsas  follows: *  ` InlettersdatedApril11,2000,totheGovernorsof ` theaffectedStates,weadvisedthattheStatesmaysubmit z byOctober30,2000PhaseISIPsthatincludeabudget "!  allowingmoreemissionsthanundertheNOxSIPCallRule. "X" Thisbudgetneednotincludeanyreductionsfromasetof r$$ EGUsthatwebelieveincludesallofthesmallcogenerators && orreductionsfrominternalcombustionengines.In 'P!( addition,weadvisedWisconsinthatitneednotsubmitaNOx j)"* SIPCallSIPrevision.Further,weadvisedGeorgiaand +$, MissourithattheydidnothavetosubmitNOxSIPCallSIPs r atthistime.WeadvisedAlabamaandMichiganthatalthough  theCourtupheldtheNOxSIPCallfortheirentireStates,  P thereasoningoftheCourtsopinionconcerningGeorgiaand j  Missourisupportedexcludingemissionsfromthecoarsegrid   portionoftheirStates.Wealsostatedthatiftheywanted H  thecoarsegridportionoftheirStatesexcluded,theycould b  submitaPhaseIbudgetaddressingsourcesinonlythefine    gridportionoftheState.AllStateswerefurtheradvised @  thattheremandedissueswouldbeaddressedinafuture Z rulemaking.   ` ManyStatesdidnotofficiallysubmitcompleteSIPsas 8 requiredbyOctober30,2000.BynoticedatedDecember26, R 2000(65FR81366),weissuedfindingsoffailuretosubmit.  AchallengetothosefindingshasbeenfiledintheD.C. 0 Circuit.  J #X;XX:X;# ` Todaysactionsetsforthourproposalforthesecond    phaseorPhaseIIoftheNOxSIPCallbyaddressingthe "(" classificationof_cogenerators_ԀasEGUs,andadjustingthe B$$ budgetsaccordingly;thecontrollevelforlargeinternal %x& combustionengines;thedatebywhichStatesmustsubmita ' !( PhaseIIbudget,andGeorgiaandMissourimustsubmitSIPs :)"* tomeetthefullNOxSIPCallbudget;thecompliancedates *p$, forStatestomeettheirPhaseIIbudgets,andforGeorgia r andMissouritomeetthefullNOxSIPCallbudget;andthe  emissionsbudgetsforGeorgiaandMissouri,whichare  P proposedtobebasedononlythefinegridportionofthese j  States.Inaddition,weproposetomodifythebudgetsfor   AlabamaandMichiganbasedoninclusionofonlythefine H  gridportionofthoseStates.Further,weareproposingto b  excludeWisconsinfromtheNOxSIPCall.     ` Anyadditionalemissionsreductionsrequiredasa @  resultofafinalrulemakingonthisproposalwillbe Z reflectedinthePhaseIIportionoftheStatesemissions  budget.TheemissionsreductionsrequiredinPhaseIIare 8 relativelysmall,representinglessthan10percentoftotal R reductionsrequiredbytheSIPCall.Theduedateforthe  SIPsmeetingtheresultingStateemissionsbudgets( Phase 0 IISIPs)andpartialStatebudgetsforGeorgiaandMissouri J isdiscussedbelowinsectionsII.JandII.K.Theproposed    changestotheStatesemissionsbudgetsarediscussedin "(" sectionII.E. B$$ :X;XXX; ` Asnotedabove,todaysactionproposestocontinuethe %x& classificationof_cogenerators_ԀasEGUs,andpresents ' !( supportforthatclassification. :)"*  ` Inaddition,intodaysaction,werequestthat *p$, _cogenerators_ԀthatwouldbesubjecttoclassificationasEGUs r intheNOxSIPCallandtheSection126Ruleidentify  themselvesas_cogenerators_Ԁand,ifapplicable,small  P generators,sothatEPAandtheStateswillbeableto j  clarifythatportionoftheirNOxinventory.    ` Todaysactionalsoincludestechnicalhousekeepingby H  makingminorrevisionstotheNOxSIPCalldefinitionof b  EGUsandnonEGUstomakethosedefinitionsconsistentwith    thedefinitionsofEGUsandnonEGUsintheSection126 @  Rule.Todaysproposalretainsthosedefinitionsinthe Z Section126Rule.   ` TodaysproposaldoesnotaddresstheEGUgrowth 8 remand.Weintendtoactonthatissueseparately.Ifany R additionalrevisionstobudgetsarenecessary,theywillbe  addressedinthataction.BynoticedatedAugust3,2001, 0 wepublishedourpreliminaryresponsetotheremandinwhich J weindicatedthatwebelievedourmethodforestimating    growthinemissionsfromEGUswasreasonable,wenotified "(" thepublicthatwewereexaminingadditionaldata,whichwe B$$ putinthedocket,andinvitedcommentonthatdata(66FR %x& 40609).#X;XX:X; #:X;XXX; ' !(  ` TodaysproposaldoesnotaddressNOxSIPCallissues :)"* relatedtothe8hourNAAQS,andwehavenoplansinthe *p$, immediatefuturetoannounceaspecificprocessfordoing r so.Wehave#X;XX:X;(#:X;XXX;ԀstayedthefindingsintheNOxSIPCallbased  onthe8hourNAAQS,andarecontinuingtoconduct  P rulemakingconcerningthe8hourNAAQS.#X;XX:X;)#   j   II.WhatistheScopeofthisProposal?     ` Inthisaction,wearesolicitingcommentononlythe `  specificchangestheAgencyisproposinginresponsetothe z  CourtsrulingsontheNOxSIPCall,Section126,and "  TechnicalAmendmentsrulemakings.Wearenotreopeningthe X  remainderofthosethreerulemakingsforpubliccommentand r reconsideration.Specifically,wearesolicitingcommenton  thefollowing: P 0 `  (1)0` ` (#` (#CertainaspectsofthedefinitionsofEGUandnonEGU. j Wearenotproposingtochangethemannerinwhichthe  budgetsarecalculatedforEGUsandnonEGUboilersand H turbinesunderthefinalNOxSIPCall,theTechnical b Amendments,andtheSection126Rules.Wealsoarenot  !  proposingtochangethedefinitionsofEGUandnonEGU "@" usedintheSection126Rules(e.g.,intheallocation Z$$ methodology.Weareaddressingtheissuesconcerning && thedefinitionofEGUasappliedtocertain '8!( cogenerationunitsbyproposingtoretaintheEGU R)"* definitionintheSection126Ruleandtoretainthe *$, basicEGUdefinitionusedintheNOxSIPCallRulewith r minor,technicalrevisionstomakeitconsistentwith  thedefinitionintheSection126Rule. P` (#` (# 0 `  Aspartofourtreatmentofthe_cogenerator_ j  issues,weareincreasingtherequiredlevelof   emissionsreductions,andthusreducingthebudgets,to H  requirereductionsfromasetofunits!termedthe b  nonacidrainunits!thatweexcludedaspartofPhase    Iongroundsthattheyincludesmallcogenerators.@ ` (#` (# 0 `  Bywayofbackground,inlightoftheMichigan Z decisionconcerningtheNOxSIPCall,weadoptedthe  viewthattheStatesshouldproceedwithdevelopingand 8 submittingtoustheirSIPcontrolsatthelevelthat R wasundisturbedby theCourtsruling.Accordingly,we  determinedthattheSIPsrequiredtobesubmittedon 0 thescheduleestablishedbytheCourt(October30, J 2000),whichwehavetermedthePhaseISIPs,should    reflectallreductionsrequiredundertheNOxSIPCall "(" rulemakingexceptthosereductionsattributableto B$$ partsoftherulethattheCourtremandedorvacated, %x& includingsmallcogenerators.However,atthetimewe ' !( adoptedthisposition,wewereuncertainastowhich :)"* unitsconstitutedsmallcogenerators,andthetotal *p$, emissionsattributabletosmallcogenerators.r` (#` (# 0 `  Evenso,wewereawarethatalthoughmostofthe  EGUsthatweresubjecttotheNOxSIPCallwerealso  P controlledundertheAcidRainProgram,noneofthe j  smallcogeneratorswerecontrolledundertheAcidRain   Program.(UnitscontrolledundertheAcidRainProgram H  maybetermed acidrainunits,andthosenotso b  controlledmaybetermed nonacidrainunits.)    Accordingly,weerredonthesideofcautionby @  authorizingStates,intheirPhaseISIPs,toexclude Z therequiredreductionsfromallnonacidrainunits.  Asaresult,thePhaseISIPsmayprovideforfewer 8 requiredreductionsandhigherbudgetsthanwouldhave R beenrequiredifEPAhadbeenabletodeterminewhich  ofthenonacidrainunitsshouldhavebeencategorized 0 assmallcogenerators.J` (#` (# 0 `  Intodaysaction,weareproposingtocontinue    theclassificationofcertain_cogenerators_,including "(" smallcogenerators,asEGUs.Asaresult,itmakes B$$ sensetorequireStatestoincludeintheirPhaseII %x& SIPstheanticipatedemissionsreductionsfromnonacid ' !( rainunits.Thisapproachwillhavetheeffectof :)"* increasingtheSIPsrequiredlevelofreductionsand *p$, decreasingthebudgets.r` (#` (# 0 `  Inthefinalrule,wewillindicatethesourceswe  believeshouldbeclassifiedassmallcogenerators.It  P isconceivablethatthisprocessofidentifyingsources j  willleadustoconcludethatsomeofthenonacidrain   unitsshouldnotbeincludedasEGUsand,therefore, H  thatfurtheradjustmentstothebudgetsofparticular b  Statesmaybenecessary.Inthiscase,wewillmake    thosefurtheradjustmentsinthefinalrule.Because @  weanticipatethatonlyasmallnumberofsources Z currentlymeetthedefinitionofsmallcogenerators,we  expectfew,ifany,revisionstothebudgetsresulting 8 fromtodaysproposal,andifanyrevisionsdoresult, R weanticipatethattheywillbeverysmallandwillnot  affectmostStates.0` (#` (# 0 `  Weareproposingminor,technicalchangestothe J EGUdefinitionintheNOxSIPCalltomakeit    consistentwiththedefinitionofEGUusedinthe "(" Section126Rule.SincetheEGUdefinitionestablishes B$$ thedividinglinebetweentheEGUandnonEGU %x& categories,theproposedchangestotheEGUdefinition ' !( resultincorrespondingproposedchangestothenonEGU :)"* definitionintheNOxSIPCall,whichmakeit *p$, consistentwiththenonEGUdefinitionintheSection r 126Rule.Todaysactionconcerningthesedefinitions  doesnotproposeanyspecificrevisionstothebudgets  P establishedunderthefinalNOxSIPCallandthe j  TechnicalAmendments. ` (#` (# 0 `  (2)0` ` (#` (#Thecontrollevelassumedforlargestationaryinternal H  combustionenginesintheNOxSIPCall.Weare b  proposingarangeofpossiblecontrollevels(82to91    percent)totheinternalcombustionengineportionof @  thebudget.Z` (#` (# 0 `  (3)PartialStatebudgetsforGeorgia,Missouri,Alabama,  andMichiganintheNOxSIPCall.8` (#` (# 0 `  (4)0` ` (#` (#ChangestothestatewideNOxbudgetsintheNOxSIP R Calltoreflecttheappropriateincrementsofemissions  reductionsthatStatesshouldberequiredtoachieve 0 withrespecttothethreeremandedissues(discussed J aboveinnumbers1,2,3).  ` (#` (# 0 `  (5) ` ArangeofSIPsubmissiondatesforthe19Statesand "(" theDistrictofColumbiatoaddressthePhaseII B$$ portionofthebudget,andforGeorgiaandMissourito %x& submitfullSIPsmeetingtheNOxSIPCall: 6months ' !( through1yearfromfinalpromulgationofthis :)"* rulemaking,butnolaterthanApril1,2003.*p$,` (#` (# ! ! s(88 0 `  (6) ` ThecompliancedateofMay31,2004undertheNOxSIP r CallforallsourcesexceptthoseinGeorgiaand  Missouri,andthecompliancedateofMay1,2005for  P sourcesinGeorgiaandMissouri.j ` (#` (# (7)0 ` TheexclusionofWisconsinfromtheNOxSIPCall. ` (#` (#  (88s A. HowDoWeTreat_Cogenerators_ԀandNonAcidRainUnits?  H   ` UndertheNOxSIPCall,theamountofaStates z  significantcontributiontononattainmentinanotherState "  includedtheamountofhighlycosteffectivereductionsthat X  couldbeachievedforlargeEGUsandlargenonEGUsinthe r State.NoreductionsforsmallEGUsorsmallnonEGUswere  included.WedeterminedthatreductionsbylargeEGUsto P 0.15lbNOx/mmBtuandbylargenonEGUsto60percentof j uncontrolledemissionsarehighlycosteffective.In  developingtheStatesbudgets,weapplieddefinitionsof H EGUandnonEGUanddeterminedwhichsourceswerelargeEGUs b orlargenonEGUs.  !   ` InitsMichigandecision,theD.C.Circuitupheldthis "@" approach,butdeterminedthatwedidnotprovidesufficient Z$$ noticeandopportunitytocommentforoneaspectofour && definitionofEGUandremandedtherulemakingtousfor '8!( furtherconsideration.Specifically,apetitionerclaimed, R)"* andtheCourtagreed,that EPAdidnotprovidesufficient *$, W# e   noticeandopportunityforcommenton[the]revisionofthe r EGUdefinitiontoremovetheexclusion,fromthe EGU  category,ofcogenerationunitswithannualelectricity  P salesofonethirdorlessoftheunitspotential j  electricaloutputcapacity,or25megawatts(MWe)orless.   (Acogenerationunitmaybeownedbyautilityoranon H  utilityandisaunitthatusesthesameenergytoproduce b  boththermalenergy(heatorsteam)thatisusedfor    industrial,commercial,orheatingorcoolingpurposes;and @  electricity.)Michiganv.EPA,213F.3dat69192. Z AccordingtotheCourt, twomonthsafterthepromulgation  ofthe[NOxSIPCall]rule,EPAredefinedanEGUasaunit 8 thatservesalargegenerator(greaterthan25MWe)that R sellselectricity.Id.Applicationoftheexclusionfor  cogenerationunitsfromthedefinitionofEGUwouldresult 0 intreatingasnonEGUsthosecogenerationunitsmeetingthe J criteriafortheexclusionandtreatingasEGUsthose    cogenerationunitsnotmeetingtheexclusioncriteria.See "(" BriefofPetitionerCouncilofIndustrialBoilerOwners B$$ (CIBO)at4(submittedinMichigan). %x&  ` Thepetitionerarguedthat,undertheNOxSIPCall,we ' !( shouldapplythecriteriaforexcludingcogenerationunits :)"* fromtreatmentasutilityunits.Accordingtothe *p$, petitioner,theexclusioncriteriahadbeenestablished ,&. undertheregulationsimplementingnewsourceperformance r standardsandundertitleIVoftheCAAandtheregulations  implementingtheAcidRainProgramundertitleIV.The  P petitioneralsostatedthatsection112oftheCAAdefines j   electricitysteamgeneratingunittoexcludecogeneration   unitsmeetingthesamethresholds. H   ` TheCourtfoundthat,infailingtoapplytheexclusion b  criteriaforcogenerationunits,EPA wasdepartingfromthe    definitionofEGUsasusedinpriorregulatorycontextsand @   wasnotexplicitaboutthedeparturefromtheprior Z practiceuntiltwomonthsaftertherulewaspromulgated.  Michigan,213F.3dat692.Further,theCourtfoundthat: 8 8 `  itisanexaggerationtostatethatsome  general themeoftheregulatoryconsequencesof 0 deregulationoftheutilityindustrythroughout J rulemakingmeantthatEPAslastminuterevision    ofthedefinitionofEGUshouldhavebeen "(" anticipatedbyindustrialboilersasa logical B$$ outgrowthofEPAsearlierstatements.%x&` `  Id.TheCourtthereforeremandedtherulemakingtousfor :)"* furtherconsiderationofthisissue. *p$,  ` :X;XXX;InitsdecisionsontheSection126Ruleandthe ,&. TechnicalAmendmentsRulemakings,theD.C.Circuit,after r consideringthemeritsoftheissue,vacatedandremanded  ourclassificationofsmallcogeneratorsasEGUs.TheCourt  P heldthatwehadfailedtojustifythisclassificationand j  baseitonadequaterecordsupportcomparingthe#X;XX:X;tb#NOx:X;XXX;   reductioncostsofcogeneratorstothoseofotherEGUsor H  demonstratingthatthereisnorelevantphysicalor b  technologicaldifferencebetweensmallcogeneratorsand    utilities.IntheSection126decision,theCourtalso @  remandedourclassificationofanycogeneratorsasEGUs.#X;XX:X;kd# Z  ` Wediscussbelowthehistoricaldefinitionofutility  unit,thedefinitionofEGUintheNOxSIPCallandthe 8 Section126rulemaking,todaysproposedruleaddressing R certainaspectsoftheEGUdefinition,andtherationalefor  theproposedrule. Asdiscussedbelow,inpriorregulatory 0 programs,wehavesoughttodistinguishbetweenutilities J (regulatedmonopoliesinthebusinessofproducingand    sellingelectricity)andnonutilities.Inmakingthis "(" distinction,weappliedthe onethirdpotentialelectrical B$$ outputcapacity/25MWesalescriteria.Thesecriteria %x& definedanonutilityunitasaunitproducingelectricity ' !( forannualsalesinanamountequaltothelesserof:(i) :)"* onethirdorlessofaunitspotentialelectricaloutput *p$, capacity;or(ii)25MWeorless.Notethatthecriteria ,&. didnotalwaysapplyonlytocogenerationunitsanddidnot r uniformlyresultin lessregulationforsourcesmeeting  thecriteria.Withthedevelopmentofcompetitivemarkets  P forelectricitygenerationandsale,webelievethatthese j  criterianolongerdistinguishbetweenunitsinthebusiness   ofproducingandsellingelectricity(i.e.,EGUs)andnon H  EGUs.Inaddition,therearenorelevantdifferences b  betweenthewaycogeneratingunitsandnoncogenerating    unitsarebuiltandoperatedthatjustifycontinuingtouse @  thesecriteriaorthataffectthegeneralabilityof Z cogeneratingunitstocontrolNOx.Wearetodayproposing  toretainthebasicdefinitionofEGUintheNOxSIPCall 8 andtheSection126Ruleandtocontinuetoapplyitto R _cogenerators_.  :X;XXX; 1.WhatistheHistoricalDefinitionofUtilityUnit?  0  ` Inpriorregulatoryprograms,wehaveusedvariations b oftheonethirdpotentialelectricaloutputcapacity/25MWe  !  salescriteriatodistinguishbetweenutilitiesandnon "@" utilities.TheAgencybeganusingthesecriteriain1978, Z$$ in40CFRpart60,subpartDa.SubpartDaestablishednew && sourceperformancestandardsfor electricutilitysteam '8!( generatingunitscapableofcombustingmorethan250 R)"* mmBtu/hroffossilfuel. Electricutilitysteamgenerating *$, unitwasdefinedasaunit constructedforthepurposeof ,0&. ,'    supplyingmorethanonethirdofitspotentialelectric i outputcapacityandmorethan25MWeelectricaloutputto  anyutilitypowerdistributionsystemforsale(40CFR  P 60.41a).Inthatcase,thecriteriawerenotusedtoexempt a  unitsentirelyfromnewsourceperformancestandards.   Rather,thecriteriawereusedtoclassifyunitscapableof H  combustingmorethan250mmBtu/hroffossilfuelaseither Y   electricutilitysteamgeneratingunitssubjecttothe   requirementsundersubpartDaortoclassifythemasnon @  utility steamgeneratingunitswhich,dependingonthe Q dateofconstruction,continuedtobesubjecttothe  requirementsfor FossilFuelFiredSteamGeneratorsunder 8 subpartDorsubsequentlybecamesubjecttotherequirements I for IndustrialCommercialInstitutionalSteamGenerating  UnitsundersubpartDb.See40CFR60.41a(definitionsof 0  steamgeneratingunitand electricutilitysteam A generatingunit),60.40b(a)(statingthatsubpartDb    appliesto steamgeneratingunitswithheatinputcapacity "(" ofmorethan100mmBtu/hr),and_60.40b(e)_Ԁ(statingthat 9$$  electricsteamgeneratingunitssubjecttosubpartDaare %x& notsubjecttosubpartDb).Someoftherequirements(e.g., ' !( theemissionlimitsforparticulatematter)insubpartDor 1)"* DbwerelessstringentthanthoseinsubpartDa.These *p$, criteriaappliedtoallsteamgeneratingunits,notjust ,&. cogenerationfacilities. i  ` Weexplainedthatweweredistinguishing,insubpart  Da,between electricutilitysteamgeneratingunitsand  P  industrialboilersbecause therearesignificant a  differencesbetweentheeconomicstructureofutilitiesand   theindustrialsector(44FR33580,33589;June11,1979). H  Theonethirdpotentialelectricaloutputcapacity/25MWe Y  salescriteriawereusedasaproxyforutilityvs.   industrial/commercial/institutional(i.e.,nonutility) @  ownershipoftheunits.Webelievedthataunitinvolvedin Q electricitysalessmallenoughtobeatorbelowthelevels  inthesalescriteriawasownedbyacompanywhosebusiness 8 wasotherthanelectricgenerationandtransmissionand/or I distributionandsowasintheindustrial,nottheutility,  sector.Westatedthat, [s]incemostindustrial 0 cogenerationunitsareexpectedtobelessthan25MWe A electricaloutputcapacity,few,ifany,newindustrial    cogenerationunitswillbecoveredbythese[subpartDa] "(" standards.Thestandardsdocoverlargeelectricutility 9$$ cogenerationfacilitiesbecausesuchunitsarefundamentally %x& electricutilitysteamgeneratingunits.Id. ' !(  ` OurapproachinsubpartDareflectedthefactthat, 1)"* sincebeforethe1970'sandintothe1980's,privateor *p$, publicentitiesinthebusinessofelectricgenerationand ,&. transmissionand/ordistribution(i.e.,utilities)produced i almostalloftheelectricitygeneratedorsoldintheU.S.  Inaddition,utilitieswereregulatedmonopolieswith  P designatedserviceareas.Incontrast,nonutilitiessold a  relativelysmallamountsofelectricity,playedan   insignificantroleinthebusinessofelectricgeneration H  andsales,andwerenotregulatedmonopolies.SeeThe Y  ChangingStructureoftheElectricPowerIndustry:An   Update,EnergyInformationAdministration,December1996at p  57,9,and111. 0  ` Asimilartypeofdistinctionbetweenutilityandnon A utilityunits(usingtheonethirdpotentialelectrical  outputcapacity/25MWesalescriteria)continuedunderthe ( CAAAmendmentsof1990,inbothtitleIVandsection112of 9 titleI,butwasappliedonlytocogenerationunits.As x notedabove,acogenerationunitisaunitthatusesthe   sameenergytoproduceboththermalenergy(heatorsteam) 1!  thatisusedforindustrial,commercial,orheatingor "p" coolingpurposes;andelectricity.TitleIVestablishedthe $$ AcidRainProgramwhoserequirementsapplyto utility )&& units.Section402(17)(C)excludesacogenerationunit 'h!( fromthedefinitionof utilityunitunlesstheunit is y)#* constructedforthepurposeofsupplying,orcommences !+$, constructionafterthedateofenactmentof[titleIV]and i supplies,morethanonethirdofitspotentialelectric  outputcapacityandmorethan25MWeelectricaloutputto  P anyutilitypowerdistributionsystemforsale.42U.S.C. a  7651a(17)(C).Seealso40CFR72.6(b)(4).Noncogeneration   unitsinvolvedinelectricitysalescouldbeutilityunits H  regardlessofwhetherthenoncogenerationunitsmetone Y  thirdpotentialelectricaloutputcapacity/25MWecriteria.    ` Finally,section112oftheCAA,whichaddresses @  hazardousairpollutants,excludesfromthedefinitionof Q  electricutilitysteamgeneratingunitcogenerationunits  (butnotnoncogenerationunits)thatmeettheonethird 8 potentialelectricaloutputcapacity/25MWesalescriteria I (42U.S.C.7412(a)(8)).Undersection112,emissionlimits  establishedbytheAdministratorforhazardousair 0 pollutantslistedinsection112(b)applygenerallyto A stationarysources.However,suchemissionlimitswill    applyto electricutilitysteamgeneratingunitsonlyif "(" theAdministratormakesaspecificfindingafterconsidering 9$$ theresultsofarequiredstudy.Inparticular,section %x& 112(n)(1)(A)requirestheAdministratortostudy the ' !( hazardstopublichealthreasonablyanticipatedtooccuras 1)"* aresultofemissionsbyelectricutilitysteamgenerating *p$, unitsofthelistedpollutants afterimpositionofthe ,&. requirementsof[theCleanAirAct](42U.S.C. i 7412(n)(1)(A)).Thatsectionfurtherprovidesthatthe  Administrator shallregulateelectricutilitysteam  P generatingunitsunderthissection,iftheAdministrator a  findssuchregulationisappropriateandnecessaryafter   consideringtheresultsofthestudy.Id.Thus,in H  general,cogenerationunitsexcludedfromthedefinitionof Y   electricutilitysteamgeneratingunitaresubjectby   statute!withoutanystudyorfindingbytheAdministrator @  !totherequirementsforregulationofhazardousair Q pollutantsundersection112,whilecogenerationunits  includedinthatdefinitiononlybecomesubjecttosection 8 112basedontheAdministratorsstudyandfinding I supportingregulationofunitsmeetingthatdefinition.#X;XX:X;n#:X;XXX;Ԁ(See  64FR63025,63030;November18,1999)(Table1,showing 0 scheduleforpromulgationofstandardsforsources(i.e., A industrialboilersandinstitutional/commercialboilers)of    hazardousairpollutants).Seealso65FR79825,December "(" 20,2001[Administratorsfindingundersection 9$$ 112(n)(1)(A)]. %x&  ` Insummary,theabovedescribedprovisionsvaryasto ' !( both:(1)theapplicationoftheonethirdpotential 1)"* electricaloutputcapacity/25MWesalescriteria,which *p$, applytoallunitsinsomeprovisionsandonlyto ,&. cogenerationunitsinotherprovisions;and(2)the i consequencesofaunitmeetingthecriteria,whichresults  intheunitbeingsubjectto moreregulationundersome  P provisionsand lessor laterregulationunderother a  provisions.    2.WhatistheNOxSIPCallDefinitionofEGU? H    ` IntheNOxSIPCallrulemaking,wecontinuedthe q  generalapproach,describedabove,ofdistinguishingbetween   unitsintheelectricgenerationbusiness(here,EGUs)and X  unitsintheindustrialsector(here,nonEGUs).However, i weadoptedadifferentmethodofdefiningwhichunitsare  intheelectricgenerationbusinessbychangingthe P definitionofEGU.WedefinedEGUbyapplyingtoallfossil a fuelfiredunitsthemethodologydescribedindetailbelow   anddidnotapplytocogenerationunitstheonethird H potentialelectricaloutput/25MWesalescriteriaofthe Y  cogenerationexclusion.Underthemethodologyappliedto !  allunits,afterdeterminingthedateonwhichaunit "@" commencedoperation(e.g.,commencedcombustionoffuel),we#X;XX:X;#:X;XXX; Q$$ determinedwhethertheunitshouldbeclassifiedasanEGU %& oranonEGUbyapplyingtheappropriatecriteriadepending '8!( onthecommencementofoperationdate.Thenweclassified I)"* theunitasalargeorsmallEGUoralargeorsmallnon *$, EGU. ,0&.  ` Specifically,wenotedinaDecember24,1998 i supplementalactionthattheNOxSIPCallusedthefollowing  methodologyk XXX:X;X;XXX  7      ׀forclassifyingallunits(including  P cogenerationunits)intheStatessubjecttotheNOxSIP a  CallasEGUsornonEGUs(63FR71223,December24,1998).   Weappliedthismethodologytocogenerationunitsandnot H  theonethirdpotentialelectricaloutputcapacity/25MWe Y  salescriteriaofthe cogenerationexclusion.Seeid.   0 ` (a)(i)Forunitsthatcommencedoperationbefore @  January1,1996,weclassifiedasanEGUanyunitthat Q sellsanyelectricityforsaleunderfirmcontractto  theelectricgrid.IntheDecember24,1998 8 supplementalaction,wedidnotdefinetheterm I  electricityforsaleunderfirmcontracttothe  electricgrid.t8 XXXX;X;XXX  8      ׀0` (#` (# 0 ` (ii)ForunitsthatcommencedoperationbeforeJanuary i 1,1996,weclassifiedasanonEGUanyunitthatdid  notproduceelectricityforsaleunderfirmcontractto  P thegrid.a ` (#` (# 0 ` (iii)Forunitsthatcommencedoperationonorafter   January1,1996,weclassifiedasanEGUanyunitthat H  servesageneratorthatproducesanyamountof Y  electricityforsale,exceptasprovidedinparagraph   (a)(iv)below.@ ` (#` (# 0 ` (iv)Forunitsthatcommencedoperationonorafter Q January1,1996,weclassifiedasnonEGUsthe  followingunits:anyunitnotservingageneratorthat 8 produceselectricityforsale;oranyunitservinga I generatorthathasanameplatecapacityequaltoor  lessthan25MWe,thatproduceselectricityforsale, 0 andthathasthepotentialtouse50percentorlessof A theusableenergyoftheboilerorturbine.Inthe    December24,1998supplementalaction,wedidnot "(" definetheterm usableenergy.w XXXX;X;XXX  9      ׀9$$` (#` (# Ї0 ` (b)(i)Foraunitclassified[underparagraph(a)(i) i or(a)(iii)above]asanEGU,wethenclassifieditas  asmallorlargeEGU.AnEGUservingageneratorwith  P anameplatecapacitygreaterthan25MWeisalarge a  EGU.AnEGUservingageneratorwithanameplate   capacityequaltoorlessthan25MWeisasmallEGU. H  IntheDecember24,1998supplementalaction,wedid Y  notexpresslydefinetheterm nameplatecapacity.y  XXXX;X;XXX  10      ׀ ` (#` (# 0 ` (ii)Foraunitclassified[underparagraph(a)(ii)or @   OY0      (a)(iv)above]asanonEGU,wethenclassifieditasa i smallorlargenonEGU.AnonEGUwithamaximum  designheatinputgreaterthan250mmBtu/hourisa  P largenonEGU.AnonEGUwithamaximumdesignheat a  inputequaltoorlessthan250mmBtu/hourisasmall   nonEGU.Butsee63FR71220,71224,December24,1998 H  (explainingproceduresusedifdataonboilerheat Y  inputcapacitywerenotavailable).IntheDecember   24,1998supplementalaction,wedidnotexpressly @  definetheterm maximumdesignheatinput.{ XXXX;X;XXX  11      ׀Q` (#` (#   ` Asstatedpreviously, wedefinedtheterm EGUby  applyingtoallunits,includingcogenerationunits,the 8 methodologyinparagraphs(a)(i)and(a)(iii)aboveandused I themethodologyinparagraphs(a)(ii)and(a)(iv)aboveto  defineunitsasnonEGUs.Wedidnotuse,forcogeneration 0 units,theonethirdpotentialelectricaloutputcapacity/25 A MWesalescriteriainthe cogenerationexclusion.Itwas    thefactthatwefailedtoapplythisparticularexclusion i forcogeneratorsthatpetitionerschallengedinMichigan.   (588! !"3"  #X;XXX;ޜ#3s25  3  .3  0 `   WhatMinorRevisionsAreBeingMadetotheDefinition  P ofEGU intheNOxSIPCallandtheSection126Rule? 3sô݌y ` (#` (# Ќ   ` Intodaysrulemaking,weareaddressingthreeaspects 9  oftheEGUdefinition.First,forpurposesoftheNOxSIP x  CallandtheSection126Rule,weareproposingnottoapply   tocogenerationunitstheonethirdpotentialelectrical 1  output/25MWesalescriteriaofthe cogenerationexclusion p  inclassifyingtheunitsasEGUsornonEGUs.Undertodays  proposal,wewouldapplytoallunits,including ) cogenerationunits,thebasicapproachusedintheNOxSIP h CallRule[describedintheDecember24,1998supplemental y action(63FR71233)]andtheapproachintheSection126 ! Ruleforsuchclassification.Weareproposingtochange ` thecategorizationofunitsundertheNOxSIPCall q definitionofEGU(setforthinsectionII.A.2above)as !  unitscommencingoperationbeforeJanuary1,1996orunits "X" commencingoperationonorafterJanuary1,1996.Under i$$ todaysproposal,wewouldinsteadcategorizeunitsasunits && commencingoperationbeforeJanuary1,1997,units 'P!( commencingoperationonorafterJanuary1,1997andbefore a)"* January1,1999,orunitscommencingoperationonorafter  +$, January1,1999forpurposesofclassifyingunitsasEGUsor ,H&. nonEGUs.Thesenewcategoriesbasedoncommencementof i unitoperationarethesameasthecategoriesadoptedinthe  January18,2000Section126finalruleand,undertodays  P proposal,unitsareclassifiedthesamewayasinthe a  January18,2000Section126finalrule.Wearealso   proposingtoadopttheterm potentialelectricaloutput H  capacityandthedefinitionsoftheterms electricityfor Y  saleunderfirmcontracttotheelectricgrid, potential   electricaloutputcapacity, nameplatecapacity,and @   maximumdesignheatinputusedintheJanuary18,2000 Q Section126Rule.Asnotedabove,thesechangestoconform  totheJanuary18,2000Section126Ruledonotaffectthe 8 budgetsthatwereestablishedunderthefinalNOxSIPCall I andtheTechnicalAmendments. p    ` TheonlyaspectsoftheEGUdefinitionthatweare 0 addressingintodaysrulemakingare:theuse,for A cogenerationunits,ofthegenerallyapplicablemethodology    forEGU/nonEGUclassificationratherthanthe cogeneration "(" exclusioncriteria;thechangesincategoriesofunits 9$$ basedoncommencementofoperationdate;andtheadoptionof %x& anewtermandnewdefinitionsofterms.Thechangesto ' !( aspectsoftheEGUdefinitionresultincorresponding 1)"* changestoaspectsofthenonEGUdefinition.Theseaspects *p$, oftheEGUandnonEGUdefinitionsarediscussedindetail ,&. belowandaretheonlyissuesrelatedtoEGUandnonEGU i definitiononwhichwearerequestingcommenttoday.Weare  notreconsidering,andarenottakingcommenton,anyother  P aspectsoftheEGUornonEGUdefinitions. a  0 ` a.UseofthesameEGU/nonEGUclassification   methodologyforcogenerationunitsasforallother H  unitsY ` (#` (#  ` Webelievethatitisappropriatetoapplyto   cogenerationunitsthesamemethodologyforEGU/nonEGU @  classificationasappliedtoallotherunitsandnotto Q applytheonethirdelectricalpotentialoutputcapacity/25  MWesalescriteriainordertoclassifycogenerationunits 8 asEGUsornonEGUs.Thisisappropriatebecausethe I reasonsfordistinguishingbetweenutilitiesandnon  utilitiesnolongerexistinlightofthedramaticchanges 0 thathaveoccurredintheelectricpowerindustrysince1990 A duetotheemergenceofcompetitivemarketsforelectricity    generationinwhichnonutilitygeneratorscompetetoan "(" increasinglysignificantextentwithutilities.Asa 9$$ result,thehistoricaldifferencebetweenutilitiesandnon %x& utilitiesisincreasinglyblurredandirrelevantin ' !( determiningwhatunitsareinvolvedin,andshouldbe 1)"* classifiedas,producingandsellingelectricity.In *p$, addition,therearenophysical,operational,or ,&. technologicaldifferencesthatwarrantuseofadifferent i EGU/nonEGUclassificationmethodologyforcogeneration  unitsthanforotherunits.  P 0 `  i.0` ` (#` (#Distinctionbetweenunitsintheelectricgeneration a  businessandunitsintheindustrialsector ` (#` (#  ` Asdiscussedabove,distinguishingbetweenunits H  producingelectricityforsaleandunitsproducing Y  electricityforinternaluseorproducingsteamisalong   standingapproachinsettingemissionlimits.IntheNOx @  SIPCall,theSection126Rule,andtodaysproposal,we Q continuetotakethisgeneralapproachbysettingdifferent  emissionlimitsforunitsproducingelectricityforsale 8 (EGUs)andunitsthatdonotproduceelectricityforsale I (nonEGUs).   ` Weareretainingthisgeneralapproachforseveral 0 reasons.First,thisisalongstandingapproach,andfew, A ifany,commentersintheNOxSIPCallandSection126    rulemakingssupportedabandoningthedistinctionbetween "(" unitsintheelectricgenerationbusinessandunitsinthe 9$$ industrialsector.Second,afterorganizingtheunitsinto %x& thesetwocategories,wefoundthattherewassome ' !( differenceintheaveragecompliancecostsofthetwo 1)"* groups.See65FR2677(estimatingaveragelargeEGU *p$, controlcostsas$1,432pertonin1990dollarsin1997and ,&. -5    averagelargenonEGUcostsas$1,589perton).Third,this r approachtendstoresultinunitsthatdirectlycompetein  theelectricgenerationbusinesshavingtomeetthesame  P emissionlimit,andthatresultseemsreasonable. j   ` Whileweareusingintodaysproposalthelong   standingapproachofdistinguishingbetweenunitsinthe H  electricgenerationbusinessandunitsintheindustrial b  sector,weareproposingtousethereviseddefinitionof    EGU(i.e.,theEGUdefinitionintheSection126Rule)in @  ordertoreflectrecentchangesintheelectricgeneration Z businessandthetypesofunitsthatcurrentlyparticipate  inthatbusiness.Asdiscussedbelow,thatbusinessisno 8 longerconfinedessentiallytoutilities,andnonutilities R areplayinganincreasinglysignificantrole.Weare  proposingtodefineEGUinawaythatincludesboth 0 utilitiesandnonutilitiesthatareinthatbusinessandto J notapplycriteriatocogenerationunits(i.e.,theone    thirdpotentialelectricaloutputcapacity/25MWesales "(" criteria)thattendtoexcludenonutilitiesfromtheEGU B$$ category. %x& 0 ` ii.Effectofelectricitycompetitionandelectric ' !( powerrestructuringondistinctionbetweenutilities :)"* andnonutilities*p$,` (#` (#  ` Thedevelopmentofcompetitiveelectricitymarketsis ,&. ongoing: r 0 ` Propelledbyeventsoftherecentpast,theelectric  powerindustryiscurrentlyinthemidstofchanging  P fromaverticallyintegratedandregulatedmonopolyto j  afunctionallyunbundledindustrywithacompetitive   marketforpowergeneration.Advancesinpower H  generationtechnology,perceivedinefficienciesinthe b  industry,largevariationsinregionalelectricity    prices,andthetrendtocompetitivemarketsinother @  regulatedindustrieshaveallcontributedtothe Z transition.Industrychangesbroughtonbythis  movementareongoing,andtheindustrywillremainina 8 transitionalstateforthenextfewyearsormore.The R ChangingStructureoftheElectricPowerIndustry:  SelectedIssues,1998,EnergyInformation ` Administration,July1998atix. ` (#` (# SeealsoTheChangingStructureoftheElectricPower :!  Industry:AnUpdate3538(discussingthefactorsunderlying "" theongoingdevelopmentofcompetitiveelectricitymarkets $H$ andrestructuringoftheelectricpowerindustry).Because b&& oftheongoingdevelopmentofelectricitymarketsand  (!( electricpowerindustryrestructuring,competitionin )@#* electricgenerationisexpectedtobecomemorepervasivein Z+$, thefuture.ElectricPowerAnnual1998,Vol.II,Energy r InformationAdministration,December1998at1and4. 2  ` Withincreasedcompetitionandindustryrestructuring,  h bothutilitiesandnonutilitiesaregeneratingandselling   significantamountsofelectricity,atrendthatislikely *  toincreaseinthefuture.Inparticular,theincreasing `  roleofnonutilitiesisreflectedinelectricpowerdata z  fortheperiod19921998indicatingthat: "   (88"3"  3n2(  1  )3  0 `   thenumberofinvestorownedutilitieshasdecreasedby X  nearly8percent,whilethenumberofnonutilitieshas r increasedbyover9percent.3n݌` (#` (# Ќ  "3"  32(  2  )3  0 `   nonutilitiesareexpandingandbuyingutilitydivested P generationassets,causingtheirnetgenerationto j increaseby42percentandtheirnameplatecapacityto  increaseby72percentfrom1992to1998.Nonutility H capacityandgenerationwillincreaseevenmoreasthey b acquireadditionalutilitydivestedgenerationassets  !  overthenextfewyears.3݌"@"` (#` (# Ќ  "3"  32(  3  )3  0 `   thenonutilityshareofnetgenerationhasrisenfrom Z$$ 9percent(286millionmegawatthours)in1992to11 && percent(406millionmegawatthours)in1998.3݌'8!(` (#` (# Ќ  "3"  32(  4  )3  0 `   utilitieshavehistoricallydominatedtheadditionof R)"* newcapacitybutadditionstocapacitybyutilitiesare *$, decreasingwhileadditionsbynonutilitiesare ,0&. increasing.Intheperiod19851991,utilitieswere r responsiblefor62percentoftheindustrysadditions  tocapacity,butthatfiguredroppedto48percentin  P theperiod19921998.TheChangingStructureofthe j  ElectricPowerIndustry1999:MergersandOther *  CorporateCombinations,EnergyInformation x  Administration,December1999atx.3F݌8 ` (#` (# Ќ   ` Infact,in1998alone,nonutilitiesaccountedfor R  about11percentofnetgenerationand81percentof   capacityadditions.Id.at8(Figure1);seealsoid.at9 0 10[Figure2(graphshowingnonutilitymegawattadditions J tocapacityfarexceedingutilityadditions)andFigure3  (graphshowingnonutilityannualgrowthrateofadditions ( tocapacityfarexceedingutilityannualgrowthrateof B additions)].Cogenerationunitscurrentlyaccountforabout x 55percentofexistingnonutilitycapacity,andthereisa   largepotentialformorecogeneration,e.g.,inboththe :!  refiningandpaperandpulpindustries.ElectricPower "p" Annual1998,Vol.IIat10. $0$  ` Alongwithincreasesinnonutilitygenerationand b&& capacity,nonutilitysalesofelectricitytoutilitiesand  (!( toendusershaveincreasedduring19941998,eventhough )@#* thevastmajorityofelectricitysalesarestillmadeby Z+$, utilities.Id.at87[Table51(showingsalestoutilities r andendusers)].Withincreasingcompetitionand  restructuring,anyunitservingageneratorregardlessof  P whethertheunitownerisautilityoranonutility(e.g., j  anindependentpowerproduceroranindustrialcompany)   canproduceandsellelectricity.Asaresult,"new H  entrants,generatingandsellingpower,havemadeinroadsin b  anindustrypreviouslyclosedtooutsideparticipants.    Becauseofthisarrayofchanges,theindustryisnowmore @  commonlycalledtheelectricpowerindustryratherthanthe Z erstwhileelectricutilityindustry."TheChanging  StructureoftheElectricPowerIndustry:SelectedIssues, h 1998at5.SeealsoTheChangingStructureoftheElectric ( PowerIndustry2000:AnUpdate,EnergyInformation Z Administration,October2000at1andSupportingStatement  fortheElectricPowerSurveys,OMBNumber19050129,Energy P InformationAdministration,September2001at7(discussing j!  thecontinuedtrendofincreasedparticipationofnon #" utilitiesinelectricpowerindustry).Particularly,in $H$ lightofincreasingnonutilitycapacityadditionsandsales b&& andthelikelihoodofcontinuedgrowthinnonutility  (!( participationincompetitiveelectricitymarkets, )@#* distinctionsbasedonownershipofunitsarebecomingless Z+$, important.Thesedistinctionsareincreasinglyirrelevant r indeterminingwhetherunitsareinvolvedin,andshouldbe  classifiedas,producingandsellingelectricity.  P  ` TheEnergyPolicyActof1992encouragedthesetypesof j  changesintheelectricpowerindustrybyrecognizinganew   categoryofnonutilitygeneratorsunderthePublicUtility H  HoldingCompaniesAct,i.e., exemptwholesalegenerators, b  whichlacktransmissionfacilitiesandareexemptfromthe    corporateandgeographicrestrictionsimposedbythePublic @  UtilityHoldingCompaniesAct.Exemptwholesalegenerators Z maygenerallychargemarketbasedratesbutcannotrequire  utilitiestopurchasetheelectricity.TheChanging 8 StructureoftheElectricPowerIndustry:AnUpdateat28 j 29.TheEnergyPolicyActalsoamendedsection211ofthe * FederalPowerActtobroadentheabilityofnonutility ` generatorstorequestthattheFederalEnergyRegulatory z Commission(FERC)orderutilitiestoprovidetransmission "!  servicesforelectricityproducedandsoldbynonutility "X" generators,e.g.,transmissionaccesstononcontiguous r$$ utilities.TheChangingStructureoftheElectricPower && Industry:SelectedIssues,1998at1.Inresponsetothe 'h!( EnergyPolicyAct,FERChasencouragedcompetitionfor )(#* electricityatthewholesalelevel(i.e.,insalesof B+$, O; e   electricityforresale)byremovingobstaclestosuch ' competition.Forexample,startingin1996,FERCissued  orders[e.g.,OrderNo.888,61FR21540(1996),andOrder w P No.889,61FR21737(1996)]requiringutilitiestoprovide   openaccessforelectricitygeneratorstotransmission   lines,filenondiscriminatoryopenaccesstariffsapplicable oH  toallpartiesseekingtransmissionservice,andparticipate   intheOpenAccessSameTimeInformationSystem(OASIS).   Id.;seealsoTheChangingStructureoftheElectricPower g@  Industry:AnUpdateat5763(describingFERCOrderNos.888 ' and889).TheFERCiscontinuingtotakeactionsaimedat  ensuringopentransmissionaccess.See,e.g.,OrderNo. h 2000,65FR809(2000)(requiringutilitiestosubmit 7 proposalsforparticipationinaregionaltransmission  organizationmeetingspecifiedrequirementsaimedat ` removingimpedimentstoelectricitycompetitionortosubmit / anyplanstoworktowardsuchparticipation).Inshort,    futureFederalactionspromotingwholesalecompetitionand "X" deregulationofelectricitygenerationwilllikelycontinue '$$ theprocessofremovingthedistinctionbetweenutilities %& andnonutilities. w'P!(  ` InsomeStates,Stateactionsmayalsocontinuethis )"* process.ManyStateshaveadoptedlegislationorapproved *$, plansfor,orhavebeguntoconsiderproviding,accessby o,H&. enduserstocompetitiveelectricitymarkets.Anumberof ' Stateshaveadoptedpilotprogramstoinitiateandevaluate  thefeasibilityofcompetitionattheretaillevel(i.e.,in w P salesofelectricitytoendusers).SeeElectricPower   Annual1998,VolIIat4;andTheChangingStructureofthe   ElectricPowerIndustry:SelectedIssues,1998atxiand93. x  Consequently,"[o]neoftheexpectationsforthefutureis _8  thatendusersofelectricitywillbeallowedtoparticipate   inaunifiedwholesale/retailmarket."Id.at3.Seealso   TheChangingStructureoftheElectricPowerIndustry:An W0 Updateat6768(describingStateactions).   ` OtherFederalagenciesthatdealwiththepower  industryhaverealizedthatthehistoricaldistinction X betweenutilitiesandnonutilitiesisnolongermeaningful. ' Inparticular,theEIAisintheprocessofrevisingits  reportingrequirementssothattherewillbevirtuallyno wP distinctionbetweenreportingbyutilitygeneratorsandby !  nonutilitygenerators.Historically,EIArequired "" utilitiestoreportelectricitygeneration,fueluse,and o$H$ otherinformationondifferentformsthannonutilitiesand && treatedtheutilityinformationaspublicinformationand '!( thenonutilityinformationasconfidentialbusiness g)@#* information.Recently,EIAbegananefforttoreduce,and +$, virtuallyeliminate,thedifferencesbetweenutilityand ,&. nonutilityformsandtomakemostinformationavailableto ' thepublic.SeeElectricPowerSurveysSupporting  Statement,EIA,November1998at6,26,289,47,50and w P SupportingStatementfortheElectricPowerSurveys,OMB   Number19050129at1617,28,and30(explainingthat   utilitiesandnonutilitieswillbesubjecttothesamedata oH  collectionanddisclosurepolicies).    ` Insummary,theincreasinglycompetitivenatureofthe   electricpowerindustryandthesignificantandincreasing g@  participationofnonutilitiesincompetitiveelectricity  marketssupportsimilartreatmentofutilitiesandnon  utilities.Webelievethat,withthesechangesinthe _8 electricpowerindustryandelectricitymarkets,thereisno  longerafactualbasisforexcludingcogenerationunitsfrom  treatmentasEGUsbyusingtheonethirdpotential W0 electricaloutputcapacity/25MWesalescriteria.  0 ` iii.Differencesbetweenthedesignandoperationof    cogeneratingunitsandnoncogeneratingunitsO"("` (#` (#  ` Thereappeartobenophysical,operational,or #$ technologicaldifferencesbetweencogenerationunits %x& producingelectricityforsaleandnoncogenerationunits G' !( producingelectricityforsalethatwouldprevent ("* cogenerationunitsclassifiedasEGUsfromachievingaverage *p$, NOxreductions,andataveragecosts,similartothose ?,&. achievedbynoncogenerationunits.Similarly,thereappear ' tobenosuchdifferencesthatwouldjustifyusingtheone  thirdpotentialelectricaloutputcapacity/25MWesales w P criteriaforclassifyingcogenerationunitsasEGUsornon   EGUs,ratherthantheclassificationmethodologyusedfor   allotherunits. oH   ` Cogenerationunitsoperateintwobasic   configurations. X;XXX;  12      ׀Thefirstisaboilerfollowedbya   steamturbinegenerator.Inthisconfiguration,steamis g@  generatedbyaboiler.Thesteamisfirstusedtopowera  steamturbinegenerator,whiletheremainingsteamisused  foranindustrialapplicationorforheatingandcooling. _8 Theboilerthatgeneratesthesteamusedinthismannercan  bedesignedandoperatedinessentiallythesamewayasa  boilerthatgeneratessteamusedonlytopowerasteam W0 turbinegenerator.Therefore,anycontrolsthatcouldbe  usedonaboilerusedtoproduceonlyelectricitycouldalso ' beusedonaboilerusedforcogeneration.Ineachcase,  theboileremitsthesameamountofNOx. w P  ` Thesecondtypicalconfigurationforacogeneration   unitisagasfiredcombinedcyclesystem.Combinedcycle   systemplantreferstoasystemcomposedofagasturbine, oH  heatrecoverysteamgenerator,andasteamturbine.   Combinedcycleunitsthatcogeneratecanbedesignedand   operatedinessentiallythesamewayascombinedcycleunits g@  thatgenerateonlyelectricity.Thewasteheatfromthegas  turbineservesastheheatinputtotheheatrecoverysteam  generatorwhichisusedtopowerthesteamturbine.Both _8 thegasturbineandthesteamturbineareconnectedto  generatorstoproduceelectricity.Thegasturbine  generatorandtheheatrecoverysteamgeneratorportionscan W0 beadaptedtosupplyprocesssteamaswellaselectrical  power.TheseunitstypicallyemitatNOxlevelswellbelow    0.15lbs/mmBtuevenwithouttheuseofpostcombustion O"(" controls.Furthermore,selectivecatalyticreduction(SCR) #$ hasbeenusedextensivelyoncombinedcycleunitsthatare %x& usedforcogenerationandthoseusedforgenerationof G' !( electricityonlyandresultsinNOxemissionsatlevelswell ("* below0.15lb/mmBtu.(SeeGECombinedCycleProductLine *p$, andPerformance,GEPowerSystems,October2000,docket#A W,0&. 9656,itemXIIL04at1011.) '  ` Bothcogenerationconfigurationsidentifiedaboveare  usedatutilityandnonutilityfacilitiesthatproduce w P electricityforsale.Thesteamgeneratedatthese   facilitiesisdividedbetweenpoweringasteamturbineand   servingprocessusesorheatingandcooling.The oH  cogenerationunitsatthesefacilitiesarealmostidentical   indesign,exceptthatanonutilityfacilitymayusemore   ofthesteamforprocessusesorheatingandcooling,rather g@  thanelectricitygeneration.   ` Further,incomparisontoanoncogenerationsystem  thatgenerateselectricityforsale,eithertypeof _8 cogenerationsystemlooksessentiallythesameexceptfor  theadditionofvalvesandpipingtosendthesteamfor  processuseorheatingandcooling.Underboththe W0 cogenerationandnoncogenerationsystemsthatgenerate  electricityforsale,allthefluegas(containingtheNOx    emissions)exitingthecombustionprocesscanbedirected O"(" throughthepollutioncontroldevicesandthenthrougha #$ stack.Becausethecogenerationandnoncogeneration %x& systemsareofessentiallythesamedesignandthefluegas G' !( exitsthesystemsinthesamemanner,thecontrolofNOx ("* emissionscanbeachievedinthesamemanner.Anypost *p$, combustionpollutioncontroldeviceusedforNOxcontrolin ?,&. eithersystemislocatedinthesameplaceandoperatedin ' thesamemanner.[Forexamplesanddiscussionofhowpost  combustioncontrolsapplytocogenerationunits,seedocket w P #A9656,item#XIIL02;XIIL03;andXIIL05at1011   and13(Figure15).]    ` Morespecifically,asdiscussedindetailinthe oH  technicalsupportdocument(LackofRelevantPhysicalor   TechnologicalDifferencesBetweenCogenerationUnitsand   UtilityElectricityGeneratingUnits,September25,2000, g@  docket#A9656,item#XIIK47),postcombustionNOx  controltechnologies,i.e.,selectivenoncatalytic  reduction(SNCR)andSCR,areavailableforuseonbothnon _8 cogenerationandcogenerationunitsproducingelectricity  forsale.Thetechnicalsupportdocumentandtheother  documentscitedabovesupportthefollowingconclusions: W0 ! ! (88"3"  3-2(  1  )3  0 `   Selectivenoncatalyticreductionisafullycommercial  technologythatusesreagentinjectedintotheboiler    abovethecombustionzonetoreduceNOxtoelemental O"(" nitrogenandwater.BecausetheNOxreductiontakes #$ placeabovethecombustionzone,boilertypehasan %x& insignificantimpactontheabilitytouseSNCR. G' !( Selectivenoncatalyticreduction:X;XXX;Ԁhasbeendemonstrated ("* onawiderangeofboilerԀR0typesandsizes(including *p$, cogenerationunits)andonawiderangeoffuels ?,&. FB e   (includingbiomass,wood,orcombinationsoffuels  suchasbark,papersludge,andfiberwaste).  #X;XX:X;/#Selectivenoncatalyticreduction:X;XXX;Ԁsystemshavebeen , P usedatawiderangeoftemperatures(e.g.,from1250   degreesFto2600degreesF)andhavebeendesignedto |  handleawiderangeofloadvariation(e.g.,33percent $H  to100percentofaunitsmaximumcontinuousrating).3--݌ ` (#` (# Ќ  "3"  332(  2  )3  0 `   Selectivecatalyticreductionisafullycommercial t  technologythatusesbothammoniainjectedafterthe @  fluegasesexittheboilerorthecombustionturbine  andcatalystinareactortoreduceNOxtoelemental l nitrogenandwater.BecausetheNOxreductiontakes 8 placeinareactoroutsidethecombustionandheat  transferzones,boilertypehasaninsignificantimpact d ontheabilitytouseSCR.#X;XX:X;1#:X;XXX;Selectivecatalytic  0 reduction#X;XX:X;g6#:X;XXX;Ԁhasbeendemonstratedonawiderangeof  boilertypesandsizesandoncombinedcyclesystems. \   TheSCRsystemshavebeenusedatawiderangeof "(" temperatures(e.g.,450degreesFto1100degreesF) #$ andhavebeendesignedtohandleawiderangeofload T%x& variation. 333݌& !(` (#` (# Ќ   ` Therefore,thesame,provenpostcombustionNOxcontrol ("* technologies(SNCRandSCR)areapplicabletonon L*p$, cogenerationunitsproducingelectricityforsaleandto +&. cogenerationunitsproducingelectricityforsale.Because  norelevantphysical,operational,ortechnological  differencesbetweenthesegroupsofunitsexistandbecause , P thepostcombustionNOxcontroltechnologiesarelocatedin   thesameplaceandoperatedinthesamemanner,wemaintain |  thatthereisnosignificantdifferenceintheaveragecost $H  ofcontrollingNOxemissionsfromtheseunits.   #X;XX:X;6# ` Forexample,inourcostanalysisofEGUs,weusedan t  averagecapitalcostof$69.70to$71.80perkilowattfor @  SCRona200MWecoalfiredEGU.SeeAnalyzingElectric  PowerGenerationUndertheCAAA,U.S.EPA,March1998,:X;XXX;  #X;XX:X; =#docket#A9656,item#VC03atA57(TableA55).The Dh recordalsoshowsthatSCRonanewcoalfiredcogeneration  unithasacapitalcostof$58perkilowatt.SeeStatus  ReportonNOxControlTechnologiesandCostEffectiveness Tx forUtilityBoilers,NESCAUMandMARAMA,June1998,docket# 8 A9656,item#VIB05at15153.:X;XXX;Ԁ#X;XX:X;?#ԀEPAmaintainsthatthis    costisreasonablyconsistentwiththeaveragecostthatEPA |"" determinedforallEGUs. X;XXX;  13      ׀:X;XXX; $$H$  ` Therefore,weconcludethatthecostestimateswemade  forNOxcontroltechnologyretrofitsapplytoboth  cogenerationandnoncogenerationunitsproducing , P electricityforsale.Intodaysrulemaking,werequest   commenton,andspecificinformationsupportingor |  contradicting,ourconclusionsthattherearenorelevant $H  physical,operational,ortechnologicaldifferencesandno   significantdifferenceinaveragecontrolretrofitcostfor t  cogenerationversusnoncogenerationunitsproducing @  electricityforsale.#X;XX:X;`@#:X;XXX;ԀAnycostinformationthatisprovided  musthavesufficientdetailandsupporttoallowevaluation l astowhethertheunitinvolvedrepresentsatypicalunit. 8  6(e88! ! "3"  3E2e  4  .3  0 `   WhatMethodologyAreWeUsingtoClassifyEGU/NonEGU    CogenerationUnits? 3EJE݌|` (#` (# Ќ   ` ForthereasonssetforthaboveinsectionII.A.3of <` todayspreamble,webelievethatitisappropriatetouse  thesamemethodologytoclassifyallunits,including    cogenerationunits,asEGUsornonEGUsandgenerallyto 4"X" classifyasEGUsallunitsthatgenerateelectricityfor #$ sale.Thisisappropriateregardlessofwhethertheowners %& oroperatorsoftheunitsgeneratingelectricityforsale ,'P!( areutilitiesornonutilities.Sincetheonethird ("* potentialelectricaloutputcapacity/25MWesalescriteria |*$, ofthe cogenerationexclusionareessentiallyproxiesfor $,H&. distinguishingbetweenutilityandnonutilityownershipof  cogenerationunits,thosecriteriaarenolongerappropriate  fordistinguishingbetweenEGUsandnonEGUsandclassifying , P cogenerationunitsasEGUsornonEGUs.Inaddition,as   alsoidentifiedinsectionII.A.3above,webelievethere |  areno_relevant_Ԁ_physical,_Ԁ_operational,_Ԁortechnological $H  _differences_Ԁbetweencogeneration_and_Ԁnon_Ԅcogeneration_Ԁunits   _producing_Ԁelectricityfor_sale._Ԁ_ t  _Ԁ ` However,inordertoprovideatransitionforunits @  commencingoperationbeforethedevelopmentofcompetitive  electricitymarketsorasthesemarketswereemerging,we l proposetoapplytocogenerationunitscommencingoperation 8 beforeJanuary1,1999atransitionalcriterionforEGU/non  EGUclassification.Thisisthesamecriterionthatwas d usedintheSeptember24,1998NOxSIPCallRule.  0 Specifically,forcogenerationunitscommencingoperation  beforeJanuary1,1999,wewillclassifyasEGUsunitsthat \   generateelectricityforsaleunderfirmcontracttothe "(" grid.Cogenerationunitsthatgenerateelectricityfor #$ sale,butnotforsaleunderafirmcontracttothegrid T%x& (i.e.,notunderaguaranteedcommitmenttoprovidethe & !( electricity),willbeclassifiedasnonEGUs.For ("* cogenerationunitscommencingoperationonorafterJanuary L*p$, 1,1999,wewillgenerallyclassifyasEGUsallcogeneration +&. unitsthatgenerateelectricityforsale,withthelimited  exceptiondiscussedbelow.Asalsodiscussedbelow,thisis  thesameapproachthatisusedforclassifyingunitsthat , P arenotcogenerationunits.    ` Webelievethatthefirmcontractcriterionprovidesa |  reasonabletransitionalmeansofmakingtheEGU/nonEGU $H  classificationforcogenerationunits.Asdiscussedabove,   withelectricitycompetitionandpowerindustry t  restructuring,thedistinctionbetweenutilityandnon @  utilityownership,andthustheonethirdpotential  electricaloutputcapacity/25MWesalescriteria,nolonger l providesarelevantmeansofdistinguishingbetweenEGUsand 8 nonEGUs.Further,applicationoftheonethirdpotential  electricaloutputcapacity/25MWesalescriteriarequires d historicaldataforeachcogenerationunitontheunits  0 electricaloutputcapacityandelectricalsales,allof  whichdatahasbeentreatedbycogenerationunitownersand \   EIAasconfidentialbusinessinformation.Wedonothave, "(" andthepetitionerandcommentersintheNOxSIPCalland #$ Section126rulemakingshaveneverprovided,complete T%x& informationontheidentificationofallunitsclaimingto & !( becogenerationunitsandonsuchunitshistoricalcapacity ("* andactualgenerationandsales. L*p$,  ` Incontrast,thefirmcontractcriterionprovidesa +&. reasonablewayofidentifyingwhichcogenerationunitshave  beensignificantlyenoughinvolvedinthebusinessof  generatingelectricityforsalethattheirownershave , P providedguaranteedcommitmentstoprovideelectricityfrom   theunitstooneormorecustomers.Moreover,the |  historicalinformationnecessarytoapplythefirmcontract $H  criteriontocogenerationunits(andotherunits)isalready   availabletous.Asdiscussedabove,capacityinvolvedin t  salesofelectricity"underfirmcontracttotheelectricity @  grid"hasbeengenerallyincludedonEIAform860A(called  EIAform860before1998)orreportedtoEIAascapacity l projectedforsummerorwinterpeakperiodsonEIAform411 8 (Item2.1or2.2,line10).Thehistoricalinformationfrom  theseformsispubliclyavailable. d  ` Applicationofthefirmcontractcriterionresultsin  0 classifying,asEGUs,cogenerationunitsthatcommenced  operationbeforeJanuary1,1999andwhoseownershave \   committedtoprovidingelectricityforsalefromtheunits. "(" Thiscriterionreflectsthefactthattheamountor #$ percentageofthesales(whichisaproxyforutilityvs. T%x& nonutilityownership)isnolongerrelevantforEGU/nonEGU & !( classification.Thecriterionisalsopracticalforusto ("* apply.Forcogenerationunitscommencingoperationonor L*p$, afterJanuary1,1999,wewillgenerallyclassifyasEGUs +&. allunitsgeneratingelectricityforsale,regardlessof  whetherthesalesaresalesunderfirmcontracttothegrid.  Thecategoryofcogenerationunitsrecentlycommencing , P operationisrelativelysmall.Inthefuture,EIAwill   likelybetreatingvirtuallyallnewdataforbothutilities |  andnonutilitiesaspublicinformation,eventhoughEIA $H  willcontinuetokeephistoricalnonutilitydata   confidential.We,therefore,believeitispracticalforus t  orStatestoobtainelectricitysalesinformationforsuch @  cogenerationunits.   ` a.Differenceintreatmentofcogenerationunitsthat l produceelectricityforsaleandthosethatproduce 8 electricityforinternaluseonly.   ` IntheMay15,2001decisionintheSection126case, d theD.C.Circuitexpressedconcernthat,undertheSection  0 126Rule,acogeneratorthatproduceselectricityforsale  maybetreatedasanEGU,acogeneratorthatproduces \   electricityforinternaluseonlymaybetreatedasanon "(" EGU,andthustwounitsthatare identicalphysicallymay #$ besubjecttodifferentemissionreductionrequirements. T%x& AppalachianPower,249F.3dat1062.EPAnotesthatthis & !( issueisnotuniquetocogenerationunitsandisinherentin ("* anyregulatoryprogramthatdistinguishesbetweenunitsin L*p$, theelectricgenerationbusinessandunitsthatareinthe +&. industrialsectorandsetsdifferentemissionlimitsforthe  twogroups. XXX:X;X;XXX  14      ׀Aspreviouslydiscussed,thisisalong  standingapproachthat,forthereasonspresentedabove,EPA , P iscontinuingtouseintheNOxSIPCallandSection126#X;XXX;}C#:X;XXX;   Rule.EPArecognizesthatthismayresultinunitsthatare |  physicallyidenticalbeingregulateddifferentlysimply $H  basedonwhetherornotelectricityproducedbytheunitis   sold.However,beforeabandoning#X;XX:X;6i#:X;XXX;thelongstandingapproach t  ofdistinguishingbetweenunitsonthisbasisanaction @  thatfew,ifany,commentersinthe#X;XX:X;j#NOxSIPCallandSection  126:X;XXX;Ԁrulemakingshaveadvocated#X;XX:X;k#:X;XXX;ԀEPAbelievesthatitis l prudenttogainexperienceinoperatingthetradingprogram 8 underthe#X;XX:X;l#NOxSIPCallandSection126:X;XXX;ԀRule.EPAproposes  totakeareasonablefirststeptotakeaccountofelectric d restructuring#X;XX:X;l#:X;XXX;Ԁandderegulationbyrevisingthedefinitionof  0 EGUtofocusonproductionofelectricityforsale,  regardlessofwhetheraunitisautilityoranonutility. \   AfterEPAhasgainedexperiencewiththe#X;XX:X;m#NOxSIPCalland "(" Section126:X;XXX;Ԁtradingprogram,#X;XX:X;4o#:X;XXX;ԀEPAintendstoconsiderwhether  totaketheadditionalstepoftreatingthesameallunits  thatproduceelectricity,whetherforsaleorinternaluse.#X;XX:X;o#:X;XXX; , P  ` b.MinorrevisionstoNOxSIPCalldefinitionofEGU.    ` i.Asnotedabove,weproposetochangethe |  categorizationofunitsusedintheNOxSIPCallfromunits $H  commencingoperationbeforeJanuary1,1996orunits   commencingoperationonorafterJanuary1,1996tounits t  commencingoperationbeforeJanuary1,1997,units @  commencingoperationonorafterJanuary1,1997andbefore  January1,1999,orunitscommencingoperationonorafter l January1,1999.Weproposetousethesenewcategoriesin 8 applyingthefirmcontractcriterionforEGU/nonEGU  classificationofallunits,includingcogenerationunits. d Thisisamodificationofthemethodologythathasbeenused  0 intheNOxSIPCall.Thismodificationissetforthabove  insectionII.Aoftodayspreamble.Undertodaysaction, \   forunitscommencingoperationbeforeJanuary1,1997,we "(" proposetousethesameperiod(i.e.,19951996)to #$ determinetheEGU/nonEGUclassificationoftheunitsaswe T%x& usedtocalculatetheEGUportionofeachStatesbudget & !( undertheNOxSIPCall.See63FR57407,October27,1998. ("* Whethersuchaunithadelectricitysalesunderfirm L*p$, contracttothegridin19951996willbeusedtodetermine +&. theunitsEGU/nonEGUclassification.   ` ForunitscommencingoperationonorafterJanuary1,  1997andbeforeJanuary1,1999,weproposetouse19971998 , P todeterminetheEGU/nonEGUclassificationofunits.   Whethersuchaunithadelectricitysalesunderfirm |  contracttothegridin19971998determinestheunits $H  EGU/nonEGUclassification.    ` Thefirmcontractcriterionwillnotapplytounits t  commencingoperationonorafterJanuary1,1999.The @  classificationofunitscommencingoperationonorafter  January1,1999willbebasedonwhethertheunitproduces l anyelectricityforsale.Ingeneral,anyunitthat 8 produceselectricityforsalewillbeanEGU,exceptthat  thenonEGUclassificationwillapplytoaunitservinga d generatorthathasanameplatecapacityequaltoorless  0 than25MWe,fromwhichanyelectricityissold,andthat  hasthepotential(determinedbasedonnameplatecapacity) \   touse50percentorlessofthepotentialelectricaloutput "(" capacityoftheunit. #$  ` Forseveralreasons,weareestablishingJanuary1, T%x& 1999asthecutoffdateforapplyingEGUandnonEGU & !( definitionsbasedonelectricitysalesunderfirmcontract ("* tothegridandthestartdateforapplyingEGUandnonEGU L*p$, definitionsbasedonanyelectricitysales.First, +&. informationisavailabletousonfirmcontractelectricity  salesonacalendaryearbasisonly.Consequently,the  classificationofunitsbasedonwhetherthegeneratorsthey , P serveareinvolvedinfirmcontractelectricitysalesmust   bemadeonacalendaryearbasis,andanycutoffmuststart |  onJanuary1.Second,useoftheJanuary1,1999cutoff $H  datefortheNOxSIPCallisconsistentwiththeuseofthat   samecutoffdateintheSection126Rule.Third,the t  January1,1999cutoffdatewilllimittheabilityofowners @  oroperatorsofnewunitsthatmightotherwisequalifyas  largenonEGUsfromobtainingsmallEGUclassificationfor l theunitsandtherebyavoidingallemissionreduction 8 requirements.Forexample,sincethecutoffdateandthe  relevantperiodfordeterminingfirmcontractelectricity d salesarepast,theownerofalargenewunitthatwould  0 otherwisenotserveageneratorwillnotbeabletoobtain  smallEGUclassificationsimplybyaddingaverysmall \   generator(e.g.,1MWe)totheunitandsellingasmall "(" amountofelectricityunderfirmcontracttothegrid. #$  ` Intheinterestsofreducingthecomplexityofthe T%x& regulationsaimedatreducinginterstatetransportofozone, & !( webelievethatitisdesirabletohaveconsistentEGU ("* definitionsintheNOxSIPCallandSection126programs. L*p$, Withtheabovedescribedchangesinthecategoriesofunits +&. basedoncommencementofoperationdate,theEGUdefinition  intheNOxSIPCallwillbethesameastheEGUdefinition  reflectedintheapplicabilityprovisions(i.e.,97.8(a)) , P oftheSection126program.    ` ii.Asnotedabove,wealsoproposetouseintheNOx |  SIPCallthesameterm potentialelectricaloutput $H  capacity,andthesamedefinitionsoftheterms    electricityforsaleunderfirmcontracttotheelectric t  grid, potentialelectricaloutputcapacity, nameplate @  capacity,and maximumdesignheatinput,adoptedinthe  January18,2000Section126finalruleandusedintheEGU l definitionintheregulations(i.e.,part97)implementing 8 theSection126program.Thebasisforthesetermsand  definitionsissetforthabove. d  5.WhatistheEffectonCogenerationUnitClassification  0 ofApplyingtheSameMethodologyasUsedforOtherUnits,  RatherThantheOneThirdPotentialElectricalOutput    Capacity/25MWeSalesCriteria?  L"p"  ` ThepetitionerinMichiganwhosuccessfullychallenged  $0$ thelackofapplicationoftheonethirdpotential %& electricaloutputcapacity/25MWesalescriteriato \'!( cogenerationunitsclaimedthatthefailuretoapplysuch )(#* criteriawouldresultin sweepingpreviouslyunaffected *$, nonEGUsintotheEGUcategory.BriefofPetitionerCIBO T,x&. at4(submittedinMichigan).Thepetitionerfurther  suggestedthat,withouttheapplicationofthesecriteria,   anysaleofelectricitywillmakeanonEGUamore , P stringentlyregulatedEGU.ReplyBriefofPetitionerCIBO   at1(submittedinMichigan). |   ` Asdiscussedabove,largeEGUsandlargenonEGUsare $H  includedinthedeterminationoftheamountofaStates   significantcontributiontononattainmentinanotherState. t  NoreductionsbysmallEGUsorsmallnonEGUsareincluded @  inthatdetermination.   ` Neitherthepetitionernoranypartythatcommentedin l theNOxSIPCallortheSection126rulemakingsidentified 8 anyspecific,existingcogenerationunitsthat,withoutthe  applicationoftheonethirdpotentialelectricaloutput d capacity/25MWesalescriteria,wouldbeclassifiedaslarge  0 EGUsbutthat,withtheapplicationofsuchcriteria,would  beclassifiedaseitherlargeorsmallnonEGUs.Infact, \   onecommentersupportingtheonethirdpotentialelectrical "(" outputcapacity/25MWesalescriteriastatedthatapplying #$ thecriteriatotheNOxSIPCall wouldnotalterthe T%x& Agencysbaselineemissionsinventory,sincecogeneration & !( unitswere,forthemostpart,classifiedcorrectlyasnon ("* EGUsinEPAscurrentdatabase.#X;XX:X;p#X8XXX;Ԁ#X;XXX8ɓ#See Responsestothe2007 L*p$, BaselineSubInventoryInformationandSignificantComments 4,X&. fortheFinalNOxSIPCall(63FR57356,October27,1998),  May1999at9.Thiscommentandthefailureofcommenters  toidentifyanyspecificcogenerationunitsaffectedby , P todaysproposedchangesuggestthatuseoftheonethird   potentialelectricaloutputcapacity/25MWesalescriteria, |  insteadoftheclassificationproposedintodaysrule, $H  wouldshiftfew,ifany,existingcogenerationunitsfrom   beinglargeEGUstobeinglargeorsmallnonEGUs. t   ` TheEGU/nonEGUclassificationmethodologythatwe @  proposetouseformostexistingcogenerationunitsisbased  onwhether,duringaspecifiedperiod,theunitserveda l generatorthatsoldelectricityunderfirmcontracttothe 8 grid.Thespecifiedperiodforunitscommencingoperation  beforeJanuary1,1997is19951996,andthespecified d periodforunitscommencingoperationonorafterJanuary1,  0 1997andbeforeJanuary1,1999is19971998.Sincethe  EGU/nonEGUclassificationisbasedonsalesunderfirm \   contractandnotsimplysales,themethodologyproposedfor "(" cogenerationunitsdoesnotclassifyasEGUsallexisting #$ cogenerationunitsthatgenerateelectricityforsale.We T%x& believethatexistingcogenerationunitsthatarenot & !( significantlyinvolvedinthebusinessofgenerating ("* electricityforsalewillbeclassifiedundertheproposed L*p$, methodologyasnonEGUs,ratherthanEGUs,becausethe +&. ownersofsuchunitswillnothavecommittedtoproviding  electricityforsalefromtheunits.   ` Werequestcommenterstoidentifybyname,location, , P andplantandpointidentificationanycogenerationunit   thatcommentersbelievewouldbeclassifiedasanEGUunder |  todaysproposedmethodologyandwouldbeclassifiedasa $H  nonEGUiftheonethirdpotentialelectricaloutput   capacity/25MWesalescriteriawereappliedinsteadofthe t  proposedmethodology.Further,werequestthatcommenters @  alsostatewhethertheunitislargeorsmallundereach  suchclassificationapproachandprovideinformationabout l eachsuchunit,supportinganyclaimedEGU,nonEGU,large, 8 andsmallclassificationsoftheunit.   ` Whilewebelievethattodaysproposedmethodologywill d classifyasnonEGUsexistingcogenerationunitsthatare  0 notsignificantlyinvolvedinthebusinessofgenerating  electricityforsale,werequestinformationaboutwhether \   adoptingtheonethirdpotentialelectricaloutput "(" capacity/25MWesalescriteria,insteadoftheproposed #$ methodology,wouldchangetheclassificationforsome T%x& cogenerationunitsinawaythatwouldmakethempotentially & !( subjecttomorestringentemissionreductionrequirements ("* thanundertheproposedmethodology.Forexample,an L*p$, existingcogenerationunitclassifiedasalargenonEGU +&. undertodaysproposedmethodologymaybecomealargeEGUif  theunitdidnotsellelectricityunderfirmcontracttothe  grid,butsoldmorethanonethirdofitspotential , P electricaloutputcapacityandservesageneratorwitha   nameplatecapacitylargerthan25MWe.Byfurtherexample, |  anexistingcogenerationunitclassifiedasasmallEGU $H  undertodaysproposedmethodologymaybecomealargenon   EGUiftheunitsoldelectricityunderfirmcontracttothe t  grid,butsoldlessthanonethirdofitspotential @  electricaloutputcapacityandhasamaximumdesignheat  inputofgreaterthan250mmBtu/hr. l  ` Werequestcommenterstoidentifybyname,location, 8 andplantandpointidentificationanycogenerationunit  thatcommentersbelievewouldbeclassifiedasalargeor d smallnonEGUundertodaysproposedmethodologyandthat  0 wouldbeclassifiedasalargeEGUiftheonethird  potentialelectricaloutputcapacity/25MWesalescriteria \   wereappliedinsteadoftheproposedmethodology.Wealso "(" requestcommenterstoidentifybyname,location,andplant #$ andpointidentificationanycogenerationunitthatthe T%x& commentersbelievewouldbeclassifiedasasmallEGUunder & !( todaysproposedmethodologyandthatwouldbeclassifiedas ("* alargenonEGUiftheonethirdpotentialelectricaloutput L*p$, capacity/25MWesalescriteriawereappliedinsteadofthe +&. proposedmethodology.Inaddition,werequestthat  commentersalsoprovideinformationabouteachidentified  unitsupportinganyclaimedEGU,nonEGU,large,orsmall , P classificationsoftheunit.   :X;XXX; ` Sourcesthatidentifythemselvesascogeneratorsor |  smallcogenerators(#X;XX:X;x#onethirdpotentialelectricaloutput $H  capacity/25MWesalescriteria:X;XXX;)shouldsubmitthefollowing   informationtoassistusinconfirmingtheiridentification: t   ` (1)Adescriptionofthefacilitytodemonstratethat @  thefacilitymeetsthedefinitionofa cogenerationunit  under40CFR72.2. l  ` (2)Datadescribingtheannualelectricitysalesfrom 8 theunitforeveryyearfromtheunitscommencementof  operationthroughthepresent.Toprovidethisinformation, d sourcesshouldsubmitthesameformastheyusedtoreport  0 theinformationtotheEIA ,or iftheyhavenotreportedthe  informationtoEIA,providethesameinformationonannual t   electricitysalesaswasorwouldhavebeenrequiredtobe "@" reportedtoEIA. #$  ` (3)Informationconcerningtheunitsmaximumdesign l%& heatinput. '8!( #X;XX:X;{# ` Undertodaysproposedmethodology,theEGUdefinition ("* basedgenerallyonwhethertheunithasanyelectricity d*$, saleswillapplytounitsthatcommenceoperationonor  ,0&. afterJanuary1,1999.Thus,ingeneral,anynewunitsthat  servegeneratorsinvolvedingeneratingelectricityforsale  willbeEGUs.Thisreflectstherestructuringofthe , P electricpowerindustryunderwhichanyunitservinga   generator(regardlessofwhethertheownerisautilityora |  nonutility)canbeinvolvedinsellingelectricityandnon $H  utilityunitsareinvolvedinanincreasingportionofthe   electricitymarket.SinceweareclassifyingasEGUs t  cogenerationunitsthatcommenceoperationonorafter @  January1,1999andsellanyelectricity,thismayresultin  classificationasEGUsofsomecogenerationunitsthat l recentlycommencedoperationorcommenceoperationinthe 8 futureandthatwouldbenonEGUsundertheonethird  potentialelectricaloutputcapacity/25MWesalescriteria. d Asdiscussedabove,wemaintainthatthisresultis  0 reasonableinlightoftodayschangingelectricitymarkets  andpowerindustryrestructuring. \    B.WhatControlLevelisBeingProposedforStationary "(" ReciprocatingInternalCombustionEngines(ICEngines)? #$ 1.WhatControlLevelWasUsedintheNOxSIPCall?  %&  ` IndevelopingbudgetsfortheNOxSIPCallproposal(62 D'h!( FR60318,November7,1997),weassumeda70percent (#* reductionatlargesourcesandreasonablyavailablecontrol *$, technology(RACT)atmediumsizedsources(theOTAG <,`&. recommendation)forabout20categoriesofnonEGU  stationarysources.Thesesourcesincluded,amongothers,  industrialboilersandturbines,cementkilns,glass , P manufacturing,ICengines,sandandgraveloperations,and   steelmanufacturing.OnceStateNOxbudgetcomponentswere |  establishedforaparticularoption,controlstrategieswere $H  developedfortheleastcostsolutiontoattainthese   budgets.Theleastcostsolutionwasachievedbyassuming t  controlsonover9,000NOxsourcesofvarioussizesand @  categoriesatanaveragecosteffectivenessof$1,650/ton;  twothirdsoftheNOxemissionsreductionswerefromonly l twosourcecategories:nonEGUboilersandICengines. 8  ` InthefinalNOxSIPCallRule,welookedatapplyinga  sizecutoffforsmallsourcesandconsideredvarious d controllevelsforeachofthecategoriesoflargenonEGU  0 stationarysources.Wedeterminedthathighlycost  effectivecontrolsfornonEGUswereappropriateforonly \   threecategories:largeindustrialboilersandturbines, "(" cementkilns,andICengines.ForlargeICengines,we #$ determined,basedontherelevantAlternativeControl T%x& Techniques(ACT)document XXXX;XXXXXXXXXXXXXXXXXXXXXXXXX;XXX  15      ,thatpostcombustioncontrols & !( areavailablethatwouldachievea90percentreductionfrom ("* uncontrolledlevelsatcostswellbelow$2,000perton.  Therefore,thebudgetcalculationsincludeda90percent  decreaseforlargeICengines. , P  2.WhatWastheMarch3,2000CourtDecision RegardingIC   Engines?     ` InthelitigationontheNOxSIPCall,theInterstate Tx  NaturalGasAssociationofAmerica(INGAA),atrade   associationthatrepresentsmajorinterstatenaturalgas   transmissioncompaniesintheUnitedStates,contendedthat Lp  wedidnotprovideadequatenoticeandopportunityto  commentonthecontrollevelassumedforICenginesinits  determinationofStateNOxbudgetsforthefinalrule.In Dh Michiganv.EPA,213F.3dat693,theCourtagreedand  remandedthisissuetousforfurtherconsideration.   ` TheINGAAfurthercontendedthatthedocumentsthatwe <` reliedondidnotsupportourassumptionof90percent  controllevel.Inremandingduetoinadequatenotice,the    Courtdidnotruleonthemeritsoftheissue,i.e.,the 4"X" levelofcontrolforICengines. #$  ` Inaddition,INGAAchallengedourdefinitionof large %& ICengine XXXX;XXXXXXXXXXXXXXXXXXXXXXXXX;XXX  16      .TheCourt,however,upheldtheAgencys ,'P!( definitionoflargeICengine,statingthatwewentthrough  anextensivecommentperiodonthisissue.Id.at69394.   3.WhataretheEmissionsfromICEngines?  , P  ` ThelargeICenginesaffectedbytheNOxSIPCallare   primarilyusedinpipelinetransmissionservicewithgas   turbinesatcompressorstations.UncontrolledNOxemissions <`  fromlargeICenginesare,onaverage,greaterthan3.0   lbs/mmBtuanduncontrolledNOxemissionsfromgasturbines   areabout0.3lbs/mmBtu.IntheNOxSIPCall,wedetermined 4X  thathighlycosteffectivecontrolsareavailabletoreduce  emissionsfromlargeICenginesby90percentfrom  uncontrolledlevels(i.e.,toabout0.3lbs/mmBtu); XXXX;XXXXXXXXXXXXXXXXXXXXXXXXX;XXX  17      ׀and ,P thatNOxemissionsfromlargegasturbines(andboilers)can  bedecreasedbyhighlycosteffectivecontrolstoanaverage | regionwideemissionrateof0.150.17lbs/mmBtu\ XXXX;XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX;XXX  18      . $H  ` B.` hp x (#XBIntheSeptember24,1998finalNOxSIPCallRule,we  identifiedabout300largeICengines.Subsequently,we t   receivedinformationfromcommentersseekingtomakechanges "@" 0.W    totheemissionsinventory.Wemadecorrectionstothe  emissionsinventorywhichnowincludesabout200largeIC  enginesin___the_ԀfinalNOxSIPCallbudget(65FR11222).The / P vastmajorityoflargeICenginesincludedinthebudgetare   naturalgasfired.    4.WhatControlTechnologiesareAvailableforICEngines?  'H    ` FortheNOxSIPCall,wedividedICenginesintofour   categoriesandassigned(forpurposesofthebudget   calculation)a90percentemissionsdecreaseonaverageto 7X  eachcategory.The90percentdecreasewasbasedon  informationinourACTdocumentforICenginesand  applicationofthefollowingcontrols:nonselective /P catalyticreduction(NSCR)fornaturalgasfiredrichburn  enginesandSCRfordiesel,dualfuel,andnaturalgasfired  leanburnengines. 'H  ` AsdescribedindetailintheACTdocument,several  othercontroltechnologiesareavailabletodecrease w   emissionsofNOxfromICengines.Fornaturalgasfired "@" richburnengines,thefollowingadditionalcontrolsexist: #$ air/fueladjustment,ignitiontimingretard,ignitiontiming o%& retardplusair/fueladjustment,prestratifiedcharge,and '8!( lowemissioncombustion.Fordieselengines,ignition ("* timingretardcanalsobeusedtoreduceemissionsofNOx. g*$, Fordualfuelenginesignitiontimingretardandlow ,0&. emissioncombustionareavailable.Finally,fornatural  gasfiredleanburnengines,thefollowingadditional  controlsexist:air/fueladjustment,ignitiontiming / P retard,ignitiontimingretardplusair/fueladjustment,and   lowemissioncombustion.Thesecontrolstechnologiesvary   intermsofcost,effectiveness,additionalfuelneeded,and 'H  impactonpoweroutput.    ` TheNOxSIPCallbudgetswerecalculatedbyapplying w  controlsdescribedintheACTdocumentforICenginesthat @  representedthegreatestemissionsreductionsthatwouldbe  achievedbyapplyingavailable,highlycosteffective o controls.FornaturalgasfiredrichburnICengines,NSCR 8 providesthegreatestNOxreductionofallthehighlycost  effectivetechnologiesconsideredintheACTdocumentandis g capableofprovidinga90to98percentreductioninNOx 0 emissions.Fordieselanddualfuelengines,SCRprovides  thegreatestNOxreductionofallhighlycosteffective _   technologiesconsideredinthe1993ACTdocumentandis "(" reportedtoprovidean80to90percentreductioninNOx #$ emissions.MorerecentreportsstatethatNOxemissionscan W%x& bereducedbygreaterthan90percentbySCR.Therefore,we & !( estimateNOxreductionsfortheseenginesat90percenton ("* average.Weestimatethepopulationofdiesel/dualfuelIC O*p$, enginesisaverysmallpartofthelargeICengines +&. populationintheNOxSIPCall(lessthan3percent).   ` Inadditiontobeinghighlycosteffectiveand  providinggreateremissionreductions,theaboveselected / P controlsgenerallyhavetheadvantageofrequiringless   additionalfuelandhavelessadverseimpactonpower   output.Forexample,ignitionretardandairfuelratio 'H  adjustmentrequirestheuseofupto7percentadditional   fuelandprestratifiedchargetechnologymayreducepower w  outputupto20percent.Incontrast,NSCRandSCR @  technologiesrequireadditionalfuelintherangeof0.5to  5percentandmayreducepoweroutputonlyinthe1to2 o percentrange. 8  ` ForalllargeICengines,exceptnaturalgasfired  leanburnengines(seediscussionbelowonleanburn g engines),wecontinuetobelievethat90percentcontrolis 0 achievablethroughNSCRorSCRandishighlycosteffective  Є!i.e.,lessthan$2000/tonozoneseason.Thisis _   demonstratedintheACTdocumentforICenginesandinthe "(" ICEnginesTechnicalSupportDocument(TSD)entitled #$ vX;XXX; StationaryReciprocatingInternalCombustionEngines W%x& TechnicalSupportDocumentforNOxSIPCallProposal,EPA, & !( OAQPS,September5,2000(ICEnginesTSD).Therefore,we ("* proposetoassigna90percentemissionsdecreaseonaverage O*p$, forlargenaturalgasfiredrichburn,diesel,anddualfuel +&. ICengines.Weinvitecommentonallthecontrol  technologieslistedabove,aswellasothertechnologiesnot  listed.Theappropriatecontroltechnologyandpercent / P reductionfornaturalgasfiredleanburnenginesis   discussedlaterinthisaction.    ` Thetimerequiredfromarequestforcostproposalto 'H  fieldinstallationofproposedNOxcontrolsforICengines   islessthan11months.Therefore,animplementation w  deadlineofMay31,2004isreasonableforStatesrequired @  toadoptandsubmitPhaseIIrulesnolaterthanApril1,  2003,aswellasforGeorgiaandMissouri.#X;XXvX;*# o  5.IsSCRanAppropriateTechnologyforNaturalGasFired 8 LeanBurnICEngines?    ` Informationreceivedbyusfromthenaturalgas  transmissionindustryafterpublicationoftheNOxSIPCall ?` Ruleindicatesthatmost,ifnotall,largenaturalgas  firedleanburnICenginesintheSIPCallregionarein    naturalgasdistributionandstorageserviceandthatthese 7"X" enginesexperiencefrequentlychangingloadconditionswhich #$ makeapplicationofSCRinfeasible.Theindustryalso %& statesthatlowemissioncombustion(LEC)technologyisa /'P!( proventechnologyfornaturalgasfiredleanburnIC ("* engines,whileSCRisnot.Regardingvariableload *$, operations,ourACTdocumentforICenginesstatesthat ',H&. littledataexistwithwhichtoevaluateapplicationofSCR  fortheleanburn,variableloadoperations.Withthe  understandingthattheselargeICenginesareinvariable / P loadoperations,wenowbelievethereisaninsufficient   basistoconcludethatSCRisanappropriatetechnologyfor   thelargeleanburnengines.Therefore,wearenolonger 'H  proposingthatSCRisahighlycosteffectivecontrol   technologyforthenaturalgasfiredleanburnICengines. w  Asdescribedinthenextsection,webelieveLECtechnology @  isahighlycosteffectivecontroltechnologyandis  appropriatefornaturalgasfiredleanburnICenginesin o eithervariableorcontinuousloadoperation. 8  6.IsLECTechnologyAppropriateforNaturalGasFired  LeanBurnICEngines?    ` LeanburnenginescanreduceNOxemissionsbyadjusting ?` theair/fuelratiotoaleanermodeofoperation.The  increasedvolumeofairinthecombustionprocessincreases    theheatcapacityofthemixture,loweringcombustion 7"X" temperaturesandreducingNOxformation.TheLECtechnology #$ involvesalargeincreaseintheair/fuelratio(toultra %& leanconditions)comparedtoconventionaldesigns. /'P!(  ` EmissionsofNOxfromexistingleanburnenginescan ("* varywidelyduetothespecificair/fuelratioatwhichthe *$, engineisdesignedtooperate.Fornaturallyaspirated ',H&. engines(whichoperateatnearstoichiometricair/fuel  ratios),emissionscanbeashighas26gramsperbrake  horsepowerhour(g/bhphr).Turbochargedenginescan / P reduceemissionsofNOxupto40percentbyair/fuelratio   increases.Further,enginesdesignedtooperateatvery   highair/fuelratiosandwithadvancedignitiontechnology 'H  canreduceemissionstoabout1g/bhphr.    ` Becausetherearemanytypesofexistingleanburn w  engines(e.g.,someturbocharged,somenot),theretrofit @  ofLECtechnologywouldrequiredifferentmodifications  dependingontheparticularengine.Applicationof o componentsofLECtechnologywillyieldincremental 8 emissionsreductions.Therefore,itisimportantto  carefullydefineLECtechnology.Weproposethefollowing g definition,whichissimilartothedescriptionofLEC 0 technologyintheACTdocument,andinvitecommentsonthe  definition.ImplementationofLECtechnologyforleanburn _   ICenginesmeans: "(" 0 ` Themodificationofanaturalgasfueled,spark #$ ignited,reciprocatinginternalcombustionengineto W%x& reduceemissionsofNOxbyutilizing ultra-lean & !( air-fuelratios,highenergyignitionsystemsand/or ("* pre-combustionchambers,increasedturbochargingor O*p$, addingaturbocharger,andincreasedcoolingand/or +&. addinganintercooleroraftercooler,resultinginan  enginethatisdesignedtoachieveaconsistentNOx  emissionrateofnotmorethan1.5-3.0g/bhp-hratfull / P capacity(usually100percentspeedand100percent   load). ` (#` (#  ` TheACTforICenginesandotherdocumentsindicate 'H  thatLECtechnologyisappropriateforleanburnengines,   continuousorvariableload,andishighlycosteffective. w  WebelieveapplicationofLECwouldachieveNOxemission @  levelsintherangeof1.53.0g/bhphr.Thisisan82to  91percentreductionfromtheaverageuncontrolledemission o levels,onaverage,reportedintheACTdocument.We 8 believethatLECretrofitkitsareavailableforalllarge  leanburnICengines. AsdescribedintheICEnginesTSD, g emissionstestdatacollectedoverthelastseveralyears 0 indicatethat91percentofICengineswithinstalledLEC  technologyachievedemissionratesof1.5g/bhphrorless. _   Aguaranteedlevelof2.0g/bhphrisgenerallyavailable "(" fromenginemanufacturers. #$  ` Becausemostoftheenginestestedactuallyarebelow W%x& 1.5g/bhphr,evenifsomeenginesintheSIPcallareawere & !( toexceedthe3.0level,theaverageemissionrateof ("* severalenginesisstillexpectedtobewellwithinthe1.5 O*p$, to3.0range.Thatis,whileenginesthatareequippedwith +&. LECtechnologydesignedtomeeta1.5to3.0g/bhp-hr  standardwillgenerallymeetthedesigngoal,theactual  resultsforaparticularenginemayvary.Thereisonetype / P ofenginemodel,Worthingtonengines,thatmaybe   particularlydifficulttoretrofitandwhichmayexceedthe   1.5to3.0g/bhphrLECretrofitlevel.Werequestcomment 'H  onwhereandhowmanylargeWorthingtonenginesareinthe   areacoveredbytheNOxSIPCallandwhataveragecontrol w  levelshouldbeexpectedwithapplicationofLECtechnology @  forthoseengines.   ` a.CanStatesadoptanLECtechnologystandard? o  ` States,ofcourse,arenotrequiredtoadopttechnology 8 standardrulesnoreventoadoptrulestocontrolemissions  fromICengines.However,ifStateschoosetousea g technologystandardforregulatingICengines,webelieveit 0 wouldbeappropriateforStatestoassumeanaverage  reductionlevelforeachengineinstallingthistechnology _   forpurposesofcalculatingtheState'semissionbudget. "("  ` Inmanycases,wedonotsuggestatechnologybased #$ standardsinceanemissionrateandcontinuousemissions W%x& monitoringapproachcanprovidemoreenvironmental & !( certainty.Inthisinstance,wehavedataidentifyingthe ("* tonnagebaselineforeachlargeICengine,butwedonot O*p$, haveemissionrate(orheatinput)dataforeachICengine. +&. Thus,inordertocalculatethebudgetreductionforIC  engines,wemustidentifyapercentagereductionandapply  thatvaluetothetonnagebaselineinordertocalculatethe / P budgetreductionforICengines.InthecaseofICengines,   atechnologystandardcanbereadilytranslatedintoa   percentagereduction.Further,webelievethereisalarge 'H  amountofconsistenttestdatasupportingLECtechnology   whichprovidesenvironmentalcertainty. w   z(886! ! ` b. WhatisthecosteffectivenessforlargeIC @  enginesusingLECtechnology?   ` Forthecontrolrangeof82to91percent,theaverage o costeffectivenessforlargeICenginesusingLECtechnology 8 hasrecentlybeenestimatedtobe$520to550/ton. XXXX;XXXXXXXXX;XXX  19      ׀We   acknowledgethatspecificcosteffectivenessvalueswill g varyfromenginetoengine.Thekeyvariablesin 0 determiningaveragecosteffectivenessforLECtechnology  aretheaverageuncontrolledemissionsattheexisting _   source,theprojectedlevelofcontrolledemissions, "(" annualizedcostsofthecontrols,andnumberofhoursof #$ operationintheozoneseason.TheACTdocumentusesan W%x& averageuncontrolledlevelof16.8g/bhphr,acontrolled & !( levelof2.0g/bhphr,andnearlycontinuousoperationin  theozoneseason.WebelievetheACTdocumentprovidesa  reasonableapproachtocalculatingcosteffectivenessfor / P LECtechnology.Further,webelievethecosteffectiveness   analysisshoulduseupdatedannualizedcostdataas   describedintheICEnginesTSD.Foradditional 'H  information,weanalyzedalternativeuncontrolledand   controlledlevels,hoursofoperation,andannualizedcosts w  (seeICEnginesTSD).Thesensitivityanalysisindicatesa @  rangeofcosteffectivenessforlargeICenginesusingLEC  technologyof$510to870/ton(ozoneseason). o  7.WhatNOxSIPCallBudgetCalculationsAreWeProposing?  8  ` Weproposetoassigna90percentemissionsdecreaseon  averageforlargenaturalgasfiredrichburn,diesel,and  dualfuelICengines.Forlargenaturalgasfiredleanburn 'H ICengines,weproposetoassignapercentreductionfrom  withintherangeof82to91percent.Basedonavailable w   dataregardingdemonstratedcosts,effectiveness, "@" availability,andfeasibilityofLECtechnology,and #$ considerationofcommentsreceivedinresponsetothe o%& proposal,weintendtodetermineapercentreductionnumber '8!( touseincalculatingthisportionoftheNOxSIPCall ("* budgetdecrease;thereductionislikelytobewithinthe82 g*$, to91percentrange.Theaveragecosteffectivenessforall ,0&. largeICenginesintheSIPCallpopulationisestimatedto  be$530/tonozoneseason,whereLECtechnologyisassigned  an87percentreductionandSNCRandSCRachieve90percent / P reduction. XXXX;XXXXXXXXXXXXXXXXXXXXXXXXX;XXX  20      ׀TheAgencyinvitescommentonthecontrol   levelandassociatedcosteffectivenesscalculationswith   respecttoallICenginetypes,andweareespecially 'H  interestedincommentsregardingthenaturalgasfiredlean   burnICengines. w   ` TheNOxSIPCallemissionsinventoryidentifiesnatural @  gasfiredICengines,butdoesnotseparaterichandlean  burnICengines.Inthefinalrulemaking,ifwechooseto o usedifferentcontrollevelsforrichandleanburnIC 8 engines,asproposedabove,itwouldbenecessaryto  estimatetheemissionsineachcategoryinorderto g calculatetheemissionsreductions.Weproposetoassume 0 thattwothirdsoftheemissionsfromlargenaturalgas  firedICenginesarefromleanburnoperationandonethird _   isfromrichburn.Weinvitecommentsonthisestimate. "("  C.WhatisOurResponsetotheCourtDecisiononGeorgia #$ andMissouri?  o%&   ` GeorgiaandMissouriindustrypetitionerschallenged /'P!( ourdecisiontocalculateNOxbudgetsforthesetwoStates  basedontheentiretyofNOxemissionsineachState.The  petitionersmaintainedthattherecordsupportsincluding / P onlyeasternMissouriandnorthernGeorgiaascontributing   todownwindozone.Thechallengefromthesepetitioners   generallystemsfromtheOTAGrecommendations.TheOTAG 'H  recommendedNOxcontrolstoreducetransportforareas   withinthe finegrid,butrecommendedthatareaswithin w  the coarsegridnotbesubjecttoadditionalcontrols, @  otherthanthoserequiredbytheCAA.Thiswasbasedon  OTAGsmodelinganalysis.TheOTAGrecommendationon o UtilityNOxControlswasapprovedbythePolicyGroup,June 8 3,1997(62FR60318,AppendixB,November7,1997).   ` TheCourtvacatedourdeterminationofsignificant g contributionforallofGeorgiaandMissouri.Michiganv. 0 EPA,213F.3dat685.TheCourtdidnotseemtocallinto  questionthepropositionthatthefinegridportionofeach _   Stateshouldbeconsideredtomakeasignificant "(" contributiondownwind.However,theCourtemphasizedthat #$  EPAmustfirstestablishthatthereisameasurable W%x& contribution,id.at684,fromthecoarsegridportionof & !( theStatebeforedeterminingthatthecoarsegridportionof ("* theStatesignificantlycontributestoozonenonattainment O*p$, downwind.Elsewhere,theCourtseemedtoidentifythe +&. standardas materialcontribution[]id.   ` Initsmodeling,OTAGusedgridsdrawnacrossmostof  theeasternhalfoftheUnitedStates.The finegridhas / P gridcellsofapproximately12kilometersoneachside(144   squarekilometers).The coarsegridextendsbeyondthe   perimeterofthefinegridandhascellswith36kilometer 'H  resolution.Thefinegridincludestheareaencompassedby   aboxwiththefollowinggeographiccoordinatesasshownin w  Figure1,below:SouthwestCorner:92degreesWest @  longitude,32degreesNorthlatitude;NortheastCorner:  69.5degreesWestlongitude,44degreesNorthlatitude(OTAG o FinalReport,Chapter2).TheOTAGcouldnotincludethe 8 entireEasternU.S.withinthefinegridbecauseofcomputer  hardwareconstraints. g  `   [INSERTFIGURE1]   OYp$ ` Itisimportanttonotethattherewerethreekey  factorsdirectlyrelatedtoairqualitywhichOTAG  consideredindeterminingthelocationofthefinegrid / P coarsegridline. X;XXX;  21      ׀(OTAGTechnicalSupportingDocument,   Chapter2,pg.6;4onxTO  5  www.epa.gov/ttnotag/otag/finalrpt/6/TO/ols  7onh/).   Specifically,thefinegridcoarsegridlinewasdrawnto: 'H  1)includewithinthefinegridasmanyofthe1hourozone   nonattainmentproblemareasaspossibleandstillstay w  withinthecomputerandmodelruntimeconstraints,(2) @  avoiddividinganyindividualmajorurbanareabetweenthe  finegridandcoarsegrid,and(3)belocatedalonganarea o ofrelativelylowemissionsdensity.Asaresult,thefine 8 gridcoarsegridlinedidnottrackStateboundaries,and  MissouriandGeorgiawereamongseveralStatesthatwere g splitbetweenthefineandcoarsegrids.EasternMissouri 0 andnorthernGeorgiawereinthefinegridwhilewestern  MissouriandsouthernGeorgiawereinthecoarsegrid. _    ` TheanalysisOTAGconductedfoundthatemissions "(" controlsexaminedbyOTAG,whenmodeledintheentirecoarse #$ grid(i.e.,allStatesandportionsofStatesintheOTAG W%x& regionthatareinthecoarsegrid)hadlittleimpacton & !( high1hourozonelevelsinthedownwindozoneproblemareas  ofthefinegrid. X;XXX;  22      ׀   ` BasedonOTAGsmodelingandrecommendations,the / P technicalrecordforourfinalNOxSIPCallrulemaking,and   emissionsdata,webelievethatemissionsinthefinegrid   portionsofGeorgiaandMissouricompriseameasurableor 'H  materialportionoftheentireStatessignificant   contributiontodownwindnonattainment.Specifically, w  OTAGstechnicalfindingsandrecommendationsstatethat @  areaslocatedinthefinegridshouldreceiveadditional  controlsbecausetheycontributetoozoneinotherareas o withinthefinegrid.Inaddition,weperformedStateby 8 StatemodelingforGeorgiaandMissouriaspartofthefinal  NOxSIPCallrulemaking.Theresultsofthismodelingshow g thatemissionsinbothGeorgiaandMissourimakea 0 significantcontributiontononattainmentinotherStates.  Again,ourfindingofsignificantcontributionwasnot _   disturbedbytheCourt,andtheCourtstatedthatthe "(" GeorgiaandMissouriindustrypetitionerschallengingthe #$ ruledidnotchallengethispartofthedecision.Michigan W%x&  v.EPA,213F.3d68182. & !(  ` Examiningthe2007BaseCase X;XXX;  23      ׀NOxemissionsfor   GeorgiaindicatesthattheamountofNOxemissionsper  squaremileinthefinegridportionoftheStateisover60 / P percentgreaterthaninthecoarsegridpart.InMissouri,     theamountofNOxemissionspersquaremileinthefinegrid   portionoftheStateismorethan100percentgreater(i.e., 'H  morethandouble)thaninthecoarsegridpart.X8XXX;Ԁ#X;XXX8>#ԀMoreover,   andastheCourtpointedout,thefinegridportionofeach   Stateliesclosertodownwindnonattainmentareas.Michigan _  v.EPA,213F.3dat683.TheOTAGconcludedfromits ( modelingthatthecloseranupwindareaistothedownwind  area,thegreaterthebenefitsinthedownwindareafrom Wx controlsintheupwindarea.    ` Weseenoreasontorevisetheexistingdetermination  thatsourcesinthefinegridpartsofGeorgiaandMissouri Op contributesignificantlytononattainmentdownwind.The  basisforthisdeterminationcontinuestobe:(1)the    resultsofEPAsStatebyStatemodeling;(2)OTAGsfine G"h" gridcoarsegridmodeling;(3)therelativelyhighamountof #$ NOxemissionspersquaremileinthefinegridportionsof %& eachState;and(4)thecloselocationsofthefinegrid ?'`!( portionsofeachStatetodownwindnonattainmentareas (#* comparedtothecoarsegridpart,asdescribedabove.We  arenotmakingafindingtodayastowhethersourcesinthe  coarsegridportionsofGeorgiaand/orMissourimakea / P measurableormaterialpartofthesignificantcontribution   ofeachoftheseStates,respectively.Inthisregard,as   withtheStateofWisconsindescribedbelow,wewilllookat 'H  theimpactsofthecoarsegridportionsofGeorgiaand   Missouriinconjunctionwithanyfurtheranalysisonthe w  remaining15OTAGStates.Inaddition,apartfromour @  findingsrelatingtotheSIPcall,aStatemay,ofcourse,  assesstheinStateimpactsofNOxemissionsfromitscoarse o gridarea,andimposeadditionalNOxreductions,beyondthe 8 NOxSIPCallrequirementsinthefinegrid,asnecessaryto  demonstrateattainmentormaintenanceoftheozoneNAAQSin g theState. 0  ` WeareproposingtorevisetheNOxbudgetsforGeorgia  andMissouritoincludeonlythefinegridportionsofthese _   States.Theemissionsreductionsarethereforerequired "(" fromthefinegridportionoftheState.Forpurposesof #$ determiningbudgetsforthefinegridportion,webelieve W%x& thattheOTAGlongitudeandlatitudelinesshouldbeused & !( withanadjustmenttoaccountforthefactthatsome ("* countieshaveaportionoftheiremissionsinbothgrids O*p$, (i.e.,countiesthatstraddlethelineseparatingfineand +&. coarsegrids).Becauseofdifficultiesanduncertainties  withaccuratelydividingemissionsbetweenthefineand  coarsegridofindividualcountiesforthepurposeof / P settingoverallNOxemissionsbudgets,webelievethatthe   calculationoftheemissionsbudgetsshouldbebasedonall   countieswhicharewhollycontainedwithinthefinegrid.  'H  Thatis,countieswhichstraddlethefinegridcoarsegrid   lineorwhicharecompletelywithinthecoarsegridare w  excludedfromthebudgetcalculationsforGeorgiaand @  Missouriintodaysproposal.Thecountiesthatweare  includinginthecalculationofNOxbudgetsforeachof o theseStatesarelistedinTable1 . 8 К Table1.FineGridCountiesinGeorgiaandMissouri   RXX;f R*Iddd Xdd Xdd X(#(#, ( ,  ,  , ( +  7- s87#R fN# RGeorgia -# -#R EP#f R       <2 8 s f(<#R fP# RBaldwinCo 3) 3EffinghamCo 3)  3JeffersonCo 3)! 3PutnamCo KA#" ( f f(KBanksCo 3)o# 3ElbertCo 3)o$ 3JenkinsCo 3)o% 3RabunCo KA#o& ( f f(KBarrowCo 3)?`' 3EmanuelCo 3)?`( 3JohnsonCo 3)?`) 3RichmondCo KA#?`* ( f f(KBartowCo 3)0+ 3EvansCo 3)0, 3JonesCo 3)0- 3RockdaleCo KA#0. ( f f(KBibbCo 3)/ 3FanninCo 3)0 3LamarCo 3)1 3SchleyCo KA#2 ( f f(KBleckleyCo 3) 3 3FayetteCo 3) 4 3LaurensCo 3) 5 3ScrevenCo KA# 6 ( f f(KBullochCo 3)!7 3FloydCo 3)!8 3LincolnCo 3)!9 3SpaldingCo KA#!: ( f f(KBurkeCo 3)O"p; 3ForsythCo 3)O"p< 3LumpkinCo 3)O"p= 3StephensCo KA#O"p> ( f f(KButtsCo 3)#@? 3FranklinCo 3)#@@ 3McDuffieCo 3)#@A 3TalbotCo KA##@B ( f f(KCandlerCo 3)#C 3FultonCo 3)#D 3MaconCo 3)#E 3TaliaferroCo KA##F ( f f(KCarrollCo 3)$G 3GilmerCo 3)$H 3MadisonCo 3)$I 3TaylorCo KA#$J ( f f(KCatoosaCo 3)%K 3GlascockCo 3)%L 3MarionCo 3)%M 3TownsCo KA#%N ( f f(KChattahoocheeCo 3)_& O 3GordonCo 3)_& P 3MeriwetherCo 3)_& Q 3TreutlenCo KA#_& R ( f f(KChattoogaCo 3)/'P!S 3GreeneCo 3)/'P!T 3MonroeCo 3)/'P!U 3TroupCo KA#/'P!V ( f f(KCherokeeCo 3)' "W 3GwinnettCo 3)' "X 3MorganCo 3)' "Y 3TwiggsCo KA#' "Z ( f f(KClarkeCo 3)("[ 3HabershamCo 3)("\ 3MurrayCo 3)("] 3UnionCo KA#("^ ( f f(KClaytonCo 3))#_ 3HallCo 3))#` 3MuscogeeCo 3))#a 3UpsonCo KA#)#b ( f f(KCobbCo 3)o*$c 3HancockCo 3)o*$d 3NewtonCo 3)o*$e 3WalkerCo F<#o*$f ( f (FColumbiaCo 3)?+`%g 3HaralsonCo 3)?+`%h 3OconeeCo 3)?+`%i 3WaltonCo F<?+`%j ( f(FCowetaCo 3),0&k 3HarrisCo 3),0&l 3OglethorpeCo 3),0&m 3WarrenCo KA#,0&n ( f f(KCrawfordCo 3)( 3HartCo 3)( 3PauldingCo 3)( 3WashingtonCo KA#( ( f f(KDadeCo 3) 3HeardCo 3) 3PeachCo 3) 3WhiteCo KA# ( f f(KDawsonCo 3)  3HenryCo 3)  3PickensCo 3)  3WhitfieldCo KA#  ( f f(KDeKalbCo 3)w  3HoustonCo 3)w 3PikeCo 3)w 3WilkesCo KA#w ( f f(KDoolyCo 3)G h 3JacksonCo 3)G h 3PolkCo 3)G h 3WilkinsonCo KA#G h ( f f(KDouglasCo 3) 8 3JasperCo 3) 8 3PulaskiCo -# 8 -#R uQ#f R 6, 8 ( f `(6             <2  ( ` s(<#R fcl# RMissouri -#  -#R qm#f R         <2   ( s f(<#R fm# RBollingerCo 3) ! 3IronCo 3) " 3OregonCo 3) # 3St.FrancoisCo KA# $ ( f `(KButlerCo 3) % 3JeffersonCo 3) & 3PemiscotCo 3) ' 3St.LouisCo KA# ( ( ` f(KCapeGirardeauCo 3)o) 3LewisCo 3)o* 3PerryCo 3)o+ 3St.LouisCity KA#o, ( f f(KCarterCo 3)?` - 3LincolnCo 3)?` . 3PikeCo 3)?` / 3ScottCo KA#?` 0 ( f f(KClarkCo 3)0 1 3MadisonCo 3)0 2 3RallsCo 3)0 3 3ShannonCo KA#0 4 ( f f(KCrawfordCo 3) 5 3MarionCo 3) 6 3ReynoldsCo 3) 7 3StoddardCo KA# 8 ( f f(KDentCo 3) 9 3MississippiCo 3) : 3RipleyCo 3) ; 3WarrenCo KA# < ( f f(KDunklinCo 3) = 3MontgomeryCo 3) > 3St.CharlesCo 3) ? 3WashingtonCo KA# @ ( f f(KFranklinCo 3)Op A 3NewMadridCo 3)Op B 3St.GenevieveCo 3)Op C 3WayneCo KA#Op D ( f f(KGasconadeCo -#@E -#R n#f R  @F   @G $@H ( f & $#R fx##X;XRN#  (:88zD.WhatAreWeProposingforAlabamaandMichigan inLight H oftheCourtDecisiononGeorgiaandMissouri?  oJ  ` WeareproposingtocalculateAlabamasandMichigans /PL budgetsinthesamemannerasGeorgiaandMissouri,as N describedabove.Whilenopetitionersraisedanyissues P concerningtheinclusionofonlypartsofAlabamaand 'HR MichiganintheNOxSIPCall,theCourtsreasoning T regardingGeorgiaandMissouriappliesequallytoAlabama w!V andMichigan.Basedontheinformationintherecord,we #@X areproposingtorevisetheNOxbudgetsforAlabamaand $Z Michigantoreflectreductionsonlyinthefinegrid o& \ portionsoftheseStates.Again,likeGeorgiaandMissouri, (8"^ weseenoreasontodisturbthedeterminationthatsources )#` inthefinegridcontributesignificantlytononattainment g+%b downwind. LikeGeorgiaandMissouri,thefinegridportions  ofbothAlabamaandMichiganareclosertodownwind1hour  ozonenonattainmentareasthanthecoarsegridpartsof / P theseStates. Also,theamountofNOxemissionspersquare   mileinthefinegridportionofAlabamaisnearly60   percentgreaterthaninthecoarsegridpart;andin 'H  MichiganthefinegridNOxemissionspersquaremileare   morethan500percentgreaterthanemissionspersquaremile w  inthecoarsegridportionofthisState.Countiesin @  MichiganandAlabamawhichstraddlethefinegridcoarse  gridareexcludedfromthebudgetcalculationsasdescribed o aboveforGeorgiaandMissouri. ThecountiesinAlabamaand 8 MichiganthatweareincludinginthecalculationofNOx  budgetsforeachoftheseStatesarelistedinTable2 . g  @Table2.FineGridCountiesinAlabamaandMichigan   * d'd (      ( I(#(#,,,,,+  AWWW.    A?+ 4 <DL!X? Alabama RXX; VWG/ !  WWW VAutaugaCo 6,!o!"W 6ColbertCo 'o!# 'GreeneCo 'o!$ 'MaconCo 0Wo!% 0St.ClairCo SWD,o!&  W SBibbCo 6,!#"D'W 6CoosaCo '#"D( 'HaleCo '#"D) 'MadisonCo 0W#"D* 0ShelbyCo SWD,#"D+  W SBlountCo 6,!",W 6CullmanCo '"- 'JacksonCo '". 'MarionCo 0W"/ 0SumterCo SWD,"0  W SCalhounCo 6,!#1W 6DallasCo '#2 'JeffersonCo '#3 'MarshallCo 0W#4 0TalladegaCo SWD,#5  W SChambersCo 6,!?$`6W 6DeKalbCo '?$`7 'LamarCo '?$`8 'MorganCo 0W?$`9 0TallapoosaCo SWD,?$`:  W SCherokeeCo 6,!$;W 6ElmoreCo '$< 'LauderdaleCo '$= 'PerryCo 0W$> 0TuscaloosaCo SWD,$?  W SChiltonCo 6,!%@W 6EtowahCo '%A 'LawrenceCo '%B 'PickensCo 0W%C 0WalkerCo SWD,%D  W SClayCo 6,![&| EW 6FayetteCo '[&| F 'LeeCo '[&| G 'RandolphCo 0W[&| H 0WinstonCo SWD,[&| I  W SCleburneCo 6,!'0!JW 6FranklinCo ''0!K 'LimestoneCo ''0!L 'RussellCo 0W'0!M 0 SWD,'0!N  W S 6,!'!O3W 6 ''!P3 ' ''!Q3 ' 0W'!R3 0 [WWH,'!S3  W [ #X;XR#Michigan RXX; VWG/w("T  WW VAlleganCo 6,!W)x#UW 6EatonCo 'W)x#V 'KalamazooCo 'W)x#W 'MonroeCo 0WW)x#X 0St.ClairCo SWD,W)x#Y  W SBarryCo 6,! *,$ZW 6GeneseeCo ' *,$[ 'KentCo ' *,$\ 'MontcalmCo 0W *,$] 0St.JosephCo SWD, *,$^  W SBayCo 6,!*$_W 6GratiotCo '*$` 'LapeerCo '*$a 'MuskegonCo 0W*$b 0SanilacCo SWD,*$c  W SBerrienCo 6,!s+%dW 6HillsdaleCo 's+%e 'LenaweeCo 's+%f 'NewaygoCo 0Ws+%g 0ShiawasseeCo SWD,s+%h  W SBranchCo 6,!',H&iW 6InghamCo '',H&j 'LivingstonCo '',H&k 'OaklandCo 0W',H&l 0TuscolaCo SWD,',H&m  W SCalhounCo 6,!W 6IoniaCo ' 'MacombCo ' 'OceanaCo 0W 0VanBurenCo SWD,  W SCassCo 6,!W 6IsabellaCo ' 'MecostaCo ' 'OttawaCo 0W  0WashtenawCo UWWD,   W UClintonCo =W,!Gh WW =JacksonCo =W,!Gh W =MidlandCo =W,!Gh W =SaginawCo ?WW,!GhW ?WayneCo#X;XRP#<20Gh   WW < ` Today,weareproposingtorevisethebudgetsfor  AlabamaandMichiganintheSIPCallregulationstoreflect W x onlythefinegridportionsofthoseStates.Aswith   GeorgiaandMissouri,theemissionsreductionsaretherefore   requiredfromthefinegridportionoftheState.We Op  believethisapproachisconsistentwiththereasoningof   theCourtsMarch3,2000opinionconcerningGeorgiaand   Missouriandisjustifiedasprovidedabove. X;XXX;  24      ׀ Gh   ( 88E.WhatModificationsWillbeMadetotheNOxEmissions  Budgets?  !   ` Today,weareproposingasmallchangeinthestatewide o# emissionsbudgets.Weareproposingtocalculatethe 8% budgetsinthesamemannerasthetechnicalamendments(65 ' FR11222,March2,2000)forpurposesofdefiningEGUs.In g) addition,weareproposingarangeofpossiblecontrol  0+ levels(82to91percent)forthenaturalgasfiredlean !- OYm    burnICengines.XXXX;Ԁ#X;XXXۡ#FortheotherICenginesubcategories u (naturalgasfiredrichburn,diesel,anddualfuel)weare % proposing90percentcontrol.Becausethevastmajorityof  X largeICenginesarenaturalgasfiredandabouttwothirds u  oftheseareleanburn,weareapplyingthe82and91   percentreductionstoalllargeICenginesforthepurpose P  ofroughlyestimatingthisportionoftheproposedbudget. m  Therefore,weareproposingtorevisethestatewide   emissionsbudgetstoreflectthisrangeofpossiblecontrol H  levels.Thefinalbudgetswillmorepreciselyreflectthe e finalrule'sXXXX;Ԁ#X;XXX%#breakdownofcontrolpercentageper   subcategory.XXXX; H #X;XXXެ# ` WeareproposingtocalculatethebudgetsforGeorgia, e Missouri,Alabama,andMichiganassumingcontrolsinall   countiesthatarefullylocatedinthefinegrid,as @ discussedinsectionsII.C.andII.D.XXXX;Ԁ#X;XXX#ThepartialState ] budgetsforGeorgia,Missouri,Alabama,andMichiganin  !  todaysactionarecalculatedusing82percentand91 "@" percent,aswellasusingthedefinitionofEGUsas ]$$ describedabove. XXXX; && #X;XXXv# ` OurproposedbudgetsareshowninTables36.For '8!( StatesthathavesubmittedPhaseISIPs,Tables7and8show U)"* theincrementaldifferencebetweenPhaseIandPhaseII *$, budgets.SeveralStateshavealreadysubmittedSIPsthat ,0&. meettheentirebudget.However,otherStateshave ' submittedonlyaPhaseISIP.Weproposetorequirethose  Statestosupplementtheircontrolplanswithrulesthat w P willmeettheproposedPhaseIIincrement.   x      Table3.ProposedStateEmissionsBudgetsandPercent   Reduction(82PercentICEngineControl&ProposedEGU    Definition) `  h@@&(tons/season)  g@  *=IW>dd(#(#,dd P,4dd ,4dd ,4dd ,4dd P+  2(G G  ,2State 3)sL " P3ЀFinal sL  Base 3)S, "P P3ЀProposed sL  Budget 3)S, "P 3Tons sL  ЀReduced 3)S, " 3Percent sL  Reduction F<S, " , ,FConnecticut PF_8  w@46015w@P46,015 lb4_8 3 w@46015 w@ @@42850@@l42,850f  g f  g f  g g]4_8 3 @@42850 @@  @@@g3,16f  g f  g 5f  g pf/_8 3  @@ @ @@@Of?p7% pfH_8 3 @@@ , Of? ,pDelaware PF_8  @=@23797@=@P23,79f  g f  g 7f  g lb4_8 3 @=@23797 @=@ S@22862S@l22,86f  g f  g 2f  g g]4_8 3 S@22862 S@  @@8@g93f  g f  g 5f  g pf/_8 3  @@ 8@ @@@s?p4% pfH_8 3 @@@ , s? ,pDistrictof _8  Columbia OE3 ! G@6471G@O6,471 j`3_8"3 G@6471 G@ @6658@j6,658 f\3_8#3 @6658 @  @@`gf-187 pf/_8$3  @@ `g @@@;zp-3% pfH_8%3 @@@ , ;z ,pIllinois QG3 & A368870AQ368,870 nd53 '3 A368870 A ̋A271091̋An271,f  g f  g 091f  g h^53 (3 ̋A271091 ̋A  @@0@h9f  g f  g 7f  g ,f  g f  g 779f  g pf/3 )3  @@ 0@ @@@UR?p2f  g f  g 7f  g % pfH3 *3 @@@ , UR? ,pIndiana QG3 + A340654AQ340,654 nd53 ,3 A340654 A h A230381h An230,381 h^53 -3 h A230381 h A  @@@h110,273 pf/3 .3  @@ @ @@@sɩ֨?p32% pfH3 /3 @@@ , sɩ֨? ,pKentucky QG3 0 ( A237413( AQ237,41f  g f  g 3f  g nd53 13 ( A237413 ( A A162519An162,519 h^53 23 A162519 A  @@H@h74,89f  g f  g 4f  g pf/3 33  @@ H@ @@@d@yy0?p32% pfH3 43 @@@ , d@yy0? ,pMaryland QG3 5 @C@103476@C@Q103,476 mc53 63 @C@103476 @C@ @81947@m81,947 g]43 73 @81947 @  @@@@g21,529 pf/3 83  @@ @@ @@@do9?p21% pfH3 93 @@@ , do9? ,pMassachusetts PF3 : pC@87095pC@P87,09f  g f  g 5f  g lb43 ;3 pC@87095 pC@ @84922@l84,922 g]43 <3 @84922 @  @@@g2,17f  g f  g 3f  g pf/3 =3  @@ @ @@@fn?p2% kaH3 >3 @@@ , fn? ,kNewJersey QG3 ? @105489@Q105,489 mc53 @3 @105489 @ @96876@m96,876 g]43 A3 @96876 @  @@@g8,613 pf/3 B3  @@ @ @@@YL?p8% kaC3 C3 @@@ , YL? ,kNewYork QG3 D P5A255658P5AQ255,65f  g f  g 8f  g nd53 E3 P5A255658 P5A V A240322V An240,322 h^53 F3 V A240322 V A  @@@h15,33f  g f  g 6f  g pf/3 G3  @@ @ @@@,-?p6% pfH3 H3 @@@ , ,-? ,pNorthCarolina QG3 I m A224696m AQ224,69f  g f  g 6f  g nd53 J3 m A224696 m A -A165306-An165,306 h^53 K3 -A165306 -A  @@@h59,39f  g f  g 0f  g pf/3 L3  @@ @ @@@doձ?p26% pfH3 M3 @@@ , doձ? ,pOhio QG3 N A373222AQ373,22f  g f  g 2f  g nd53 O3 A373222 A (vA249541(vAn249,541 h^53 P3 (vA249541 (vA  @@2@h123,68f  g f  g 1f  g pf/3 Q3  @@ 2@ @@@Dr5?p33% pfH3 R3 @@@ , Dr5? ,pPennsylvania QG3 S A345203AQ345,20f  g f  g 3f  g nd53 T3 A345203 A @|A257928@|An257,928 h^53 U3 @|A257928 @|A  @@N@h87,27f  g f  g 5f  g pf/3 V3  @@ N@ @@@H_tb=.?p25% pfH3 W3 @@@ , H_tb=.? ,pRhodeIsland OE3 X {@9463{@O9,463 j`33 Y3 {@9463 {@ Q@9378Q@j9,378 f\33 Z3 Q@9378 Q@  @@@U@f85 pf/3 [3  @@ @U@ @@@YVe?p1% pfH3 \3 @@@ , YVe? ,pSouthCarolina QG3! ] (A152805(AQ152,805 nd53! ^3 (A152805 (A &@123496&@n123,496 h^53! _3 &@123496 &@  @@@@h29,309 pf/3! `3  @@ @@ @@@J~?p19% kaH3! a3 @@@ , J~? ,kTennessee QG3" b WA256765WAQ256,765 nd53" c3 WA256765 WA p4A198286p4An198,286 h^53" d3 p4A198286 p4A  @@@h58,479 pf/3" e3  @@ @ @@@+E'?p23% kaC3" f3 @@@ , +E'? ,kVirginia QG3# g  A210786 AQ210,78f  g f  g 6f  g nd53# h3  A210786  A H A180521H An180,521 h^53# i3 H A180521 H A  @@@@h30,26f  g f  g 5f  g pf/3# j3  @@ @@ @@@ q`?p14% kaH3# k3 @@@ ,  q`? ,kWestVirginia QG3$ l ؑA176699ؑAQ176,699 mc53$ m3 ؑA176699 ؑA }@83921}@m83,921 g]43$ n3 }@83921 }@  @@@g92,778 pf/3$ o3  @@ @ @@@>sO?p53%SIG3$ p3 @@@ ,  >sO? S=   Table4.ProposedStateEmissionsBudgetsandPercent & r Reduction(91PercentICEngineControl&ProposedEGU 't!s Definition) {(T"t @@&(tons/season) [)4#u  *?IW@dddd P4dd 44dd 44dd 44dd P4=IW>(#(#,dd P,4dd ,4dd ,4dd ,4dd P+  2(+$w+$ ,2State 3);+%x" P3ЀFinal ;+%y Base 3),%z"P P3ЀProposed ;+%{ Budget 3),%|"P 3Tons ;+%} ЀReduced 3),%~" 3Percent ;+% Reduction F<,%" , ,FConnecticut PFS, w@46015w@P46,015 lb4S,3 w@46015 w@ @@42850@@l42,8f  g f  g 50f  g g]4S,3 @@42850 @@  @@@g3,16f  g f  g 5f  g pf/S,3  @@ @ @@@Of?p7% pfHS,3 @@@ , Of? ,pDelaware PFS, @=@23797@=@P23,79f  g f  g 7f  g lb4S,3 @=@23797 @=@ S@22862S@l22,86f  g f  g 2f  g g]4S,3 S@22862 S@  @@8@g93f  g f  g 5f  g pf/S, 3  @@ 8@ @@@s?p4% pfHS, 3 @@@ , s? ,pDistrictof S,  Columbia OE'   G@6471G@O6,471 j`3S, 3 G@6471 G@ @6658@j6,658 f\3S,3 @6658 @  @@`gf-187 pf/S,3  @@ `g @@@;zp-3% pfHS,3 @@@ , ;z ,pIllinois QG'  A368870AQ368,870 nd5' 3 A368870 A tA270493tAn270,493 h^5' 3 tA270493 tA  @@@h98,377 pf/' 3  @@ @ @@@?p27% pfH' 3 @@@ , ? ,pIndiana QG'  A340654AQ340,654 nd5' 3 A340654 A  A229913 An229,913 h^5' 3  A229913  A  @@P @h110,741 pf/' 3  @@ P @ @@@<+?p33% pfH' 3 @@@ , <+? ,pKentucky QG'  ( A237413( AQ237,41f  g f  g 3f  g nd5' 3 ( A237413 ( A A162242An162,242 h^5' 3 A162242 A  @@0Z@h75,17f  g f  g 1f  g pf/' 3  @@ 0Z@ @@@#nmC?p32% kaH' 3 @@@ , #nmC? ,kMaryland QG'   @C@103476@C@Q103,476 mc5' !3 @C@103476 @C@ @@81892@@m81,892 g]4' "3 @@81892 @@  @@@g21,584 pf/' #3  @@ @ @@@?p21% kaC' $3 @@@ , ? ,kMassachusetts PF'% pC@87095pC@P87,09f  g f  g 5f  g lb4'&3 pC@87095 pC@ `@84838`@l84,838 g]4''3 `@84838 `@  @@@g2,25f  g f  g 7f  g pf/'(3  @@ @ @@@B?p3% pfH')3 @@@ , B? ,pNewJersey QG' * @105489@Q105,489 mc5' +3 @105489 @ @96876@m96,876 g]4' ,3 @96876 @  @@@g8,613 pf/' -3  @@ @ @@@YL?p8% pfH' .3 @@@ , YL? ,pNewYork QG' / P5A255658P5AQ255,65f  g f  g 8f  g nd5' 03 P5A255658 P5A T A240285T An240,285 h^5' 13 T A240285 T A  @@@h15,3f  g f  g 73f  g pf/' 23  @@ @ @@@4ۭTɮ?p6% pfH' 33 @@@ , 4ۭTɮ? ,pNorthCarolina QG' 4 m A224696m AQ224,69f  g f  g 6f  g nd5' 53 m A224696 m A #A164987#An164,987 h^5' 63 #A164987 #A  @@'@h59,f  g f  g 709f  g pf/' 73  @@ '@ @@@9T?p27% pfH' 83 @@@ , 9T? ,pOhio QG' 9 A373222AQ373,22f  g f  g 2f  g nd5' :3 A373222 A lA249241lAn249,241 h^5' ;3 lA249241 lA  @@D@h123,98f  g f  g 1f  g pf/' <3  @@ D@ @@@(B?p33% pfH' =3 @@@ , (B? ,pPennsylvania QG' > A345203AQ345,20f  g f  g 3f  g nd5' ?3 A345203 A xpA257551xpAn257,551 h^5' @3 xpA257551 xpA  @@@f@h87,65f  g f  g 2f  g pf/' A3  @@ @f@ @@@-Z"@?p25% pfH' B3 @@@ , -Z"@? ,pRhodeIsland OE'C {@9463{@O9,463 j`3'D3 {@9463 {@ Q@9378Q@j9,378 f\3'E3 Q@9378 Q@  @@@U@f85 pf/'F3  @@ @U@ @@@YVe?p1% pfH'G3 @@@ , YVe? ,pSouthCarolina QG'H (A152805(AQ152,805 nd5'I3 (A152805 (A  @123056 @n123,056 h^5'J3  @123056  @  @@@ @h29,749 pf/'K3  @@ @ @ @@@x?p19% pfH'L3 @@@ , x? ,pTennessee QG'M WA256765WAQ256,765 nd5'N3 WA256765 WA +A198015+An198,015 h^5'O3 +A198015 +A  @@@h58,750 pf/'P3  @@ @ @@@vVI?p23% pfH'Q3 @@@ , vVI? ,pVirginia QG'R  A210786 AQ210,78f  g f  g 6f  g nd5'S3  A210786  A A180154An180,154 h^5'T3 A180154 A  @@@h30,63f  g f  g 2f  g pf/'U3  @@ @ @@@1E?p15% pfH'V3 @@@ , 1E? ,pWestVirginia QG'W ؑA176699ؑAQ176,699 mc5'X3 ؑA176699 ؑA v@83822v@m83,822 g]4'Y3 v@83822 v@  @@Ь@g92,877 pf/'Z3  @@ Ь@ @@@?p53%XNL'[3 @@@ ,  ? X   Table5.ProposedPartialStateEmissionsBudgetsand ] PercentReduction(82PercentICEngineControl&Proposed h^ EGUDefinition) oH_ @@&(tons/season) O(`  A *AIWBdddd P4dd 44dd 44dd 44dd P4?IW@(#(#,dd P,dd ,dd ,dd ,dd P+  2(b ,2State 3)/c" P3ЀFinal /d Base 3) e"P P3ЀProposed /f Budget 3) g"P 3Tons /h ЀReduced 3) i" 3Percent /j Reduction F< k" , ,FGeorgia QG!l П A209914П AQ209,914 nd5!m3 П A209914 П A dA150656dAn150,656 h^5!n3 dA150656 dA  @@@@h59,258 h^/!o3  @@ @@  @@w%?h28% h^@!p3  @@ , w%? ,hMissouri PF"q @92697@P92,697 lb4"r3 @92697 @  @61433 @l61,433 g]4"s3  @61433  @  @@@g31,264 j`/"t3  @@ @  (\?34(\?j34% j`B"u3  (\?34 , (\? ,jAlabama QG#v  A169156 AQ169,156 nd5#w3  A169156  A 0A@1198270A@n119,827 h^5#x3 0A@119827 0A@  @@ @h49,329 h^/#y3  @@  @  @@&+?h29% h^@#z3  @@ , &+? ,hMichigan QG${ HA245929HAQ245,929 nd5$|3 HA245929 HA MA190908MAn190,908 h^5$}3 MA190908 MA  @@@h55,021 h^/$~3  @@ @  @@@?h22%PFD$3  @@ ,  @? P   Table6.ProposedPartialStateEmissionsBudgetsand &  PercentReduction(91PercentICEngineControl&Proposed 'h! EGUDefinition) o(H" @  '(tons/season) O)(# *CIWDdddd Pdd dd dd dd PAIWB(#(#,dd P,dd ,dd ,dd ,dd P+  2(+$+$ ,2State 3);+%" P3ЀFinal ;+% Base 3),%"P P3ЀProposed ;+% Budget 3),%"P 3Tons ;+% ЀReduced 3),%" 3Percent ;+% Reduction F<,%" , ,F Georgia QGS, П A209914П AQ209,914 nd5S,3 П A209914 П A 0WA1502460WAn150,246 h^5S,3 0WA150246 0WA  @@"@h59,668 h^/S,3  @@ "@  @@>%1?h28% h^@S,3  @@ , >%1? ,hMissouri PFS, @92697@P92,697 lb4S,3 @92697 @ `@61403`@l61,403 g]4S,3 `@61403 `@  @@@g31,294 h^/S, 3  @@ @  @@&?h34% h^@S, 3  @@ ,  &? ,hAlabama QG    A169156 AQ169,156 nd5  3  A169156  A @119290@n119,290 h^5  3 @119290 @  @@@Y@h49,866 h^/ 3  @@ @Y@  @@TBW?h29% h^@ 3  @@ , TBW? ,hMichigan QG  HA245929HAQ245,929 nd5 3 HA245929 HA `LA190860`LAn190,860 h^5 3 `LA190860 `LA  @@@h55,069 h^/ 3  @@ @  @@ܼl|?h22%PFD 3  @@ ,  ܼl|? P   Table7.ComparisonofPhaseIandProposedPhaseIIState i B NOxBudgetsComparison I" (82PercentICEngineControl) )  #$@@&(tons/season)    $ *EIWFdddd Pdd dd dd dd PCIWD(#(#,dd P,dd ,dd ,dd +  2(   ,2State 3) " P3ЀPhaseI   Budget 3) "P P3ЀProposed   PhaseII   Budget 3) !"P 3PhaseII  " Incremental  # Difference A7 $" , ,AAlabama QG% w@124795w@Q124,795 nd5&3 w@124795 w@ 0A@1198270A@n119,827 lb5'3 0A@119827 0A@ h@4968h@l4,968 aW9(3 h@4968 , h@ ,aConnecticut PF) `@42891`@P42,891 lb4*3 `@42891 `@ @@42850@@l42,8f  g f  g 50f  g g]4+3 @@42850 @@  @@D@g4f  g f  g 1f  g bX:,3  @@ , D@ ,bDelaware PF- @23522@P23,522 lb4.3 @23522 @ S@22862S@l22,86f  g f  g 2f  g g]4/3 S@22862 S@  @@@g66f  g f  g 0f  g bX:03  @@ , @ ,bDistrictof 1 Columbia OEn2 @6658@O6,658 j`333 @6658 @ @6658@j6,658 f\343 @6658 @  @@f0 bX:53  @@ ,  ,bIllinois QGn6 A278146AQ278,146 nd5n73 A278146 A ̋A271091̋An271,091 h^5n83 ̋A271091 ̋A  @@@h7,055 bX:n93  @@ , @ ,bIndiana QGn:  A234625 AQ234,625 nd5n;3  A234625  A h A230381h An230,381 h^5n<3 h A230381 h A  @@@h4,244 bX:n=3  @@ , @ ,bKentucky QGn> &A165075&AQ165,075 nd5n?3 &A165075 &A A162519An162,519 h^5n@3 A162519 A  @@@h2,556 bX:nA3  @@ , @ ,bMaryland PFnB p2@82727p2@P82,727 lb4nC3 p2@82727 p2@ @81947@l81,947 g]4nD3 @81947 @  @@`@g780 bX:nE3  @@ , `@ ,bMassachusetts PFnF @85871@P85,871 lb4nG3 @85871 @ @84922@l84,922 g]4nH3 @84922 @  @@@g949 ]S:nI3  @@ , @ ,]Michigan QGnJ (nA191941(nAQ191,941 nd5nK3 (nA191941 (nA MA190908MAn190,908 lb5nL3 MA190908 MA $@1033$@l1,033 aW9nM3 $@1033 , $@ ,aNewJersey PFnN h@95882h@P95,882 lb4nO3 h@95882 h@ @96876@l96,876 g]4nP3 @96876 @  @@g-994 bX:nQ3  @@ ,  ,bNewYork QG nR  A241981 AQ241,981 nd5 nS3  A241981  A V A240322V An240,322 h^5 nT3 V A240322 V A  @@@h1,659 bX: nU3  @@ , @ ,bNorthCarolina QG!nV  A171332 AQ171,332 nd5!nW3  A171332  A -A165306-An165,306 h^5!nX3 -A165306 -A  @@@h6,026 bX:!nY3  @@ , @ ,bOhio QG"nZ A252282AQ252,282 nd5"n[3 A252282 A (vA249541(vAn249,541 h^5"n\3 (vA249541 (vA  @@j@h2,741 bX:"n]3  @@ , j@ ,bPennsylvania QG#n^ ]A268158]AQ268,158 nd5#n_3 ]A268158 ]A @|A257928@|An257,928 h^5#n`3 @|A257928 @|A  @@@h10,230 bX:#na3  @@ , @ ,bRhodeIsland OE$nb @9570@O9,570 j`3$nc3 @9570 @ Q@9378Q@j9,378 f\3$nd3 Q@9378 Q@  @@h@f192 bX:$ne3  @@ , h@ ,bSouthCarolina QG%nf 0@1277560@Q127,756 nd5%ng3 0@127756 0@ &@123496&@n123,496 h^5%nh3 &@123496 &@  @@@h4,260 bX:%ni3  @@ , @ ,bTennessee QG&n j XA201163XAQ201,163 nd5&n k3 XA201163 XA p4A198286p4An198,286 h^5&n l3 p4A198286 p4A  @@z@h2,877 bX:&n m3  @@ , z@ ,bVirginia QG'n!n A186689AQ186,689 nd5'n!o3 A186689 A H A180521H An180,521 h^5'n!p3 H A180521 H A  @@@h6,168 bX:'n!q3  @@ , @ ,bWestVirginia PF(n"r P@85045P@P85,045 lb4(n"s3 P@85045 P@ }@83921}@l83,921 g]4(n"t3 }@83921 }@  @@@g1,124J@>(n"u3  @@ ,  @ J  `   GO Table8.ComparisonofPhaseIandProposedPhaseIIState )+%w NOxBudgetsComparison  ,%x (91PercentICEngineControl) ' I@@&(tons/season)  J *HIWIdddd Pdd dd dd EIWF(#(#,dd P,dd ,dd ,dd +  2( ,2State 3)" P3ЀPhaseI  Budget 3) "P P3ЀProposed  PhaseII   Budget 3)  "P 3PhaseII   Incremental    Difference A7  " , ,AAlabama QG   w@124795w@Q124,795 nd5 3 w@124795 w@ @119290@n119,290 lb5 3 @119290 @ @5505@l5,505 aW9 3 @5505 , @ ,aConnecticut PF  `@42891`@P42,891 lb4 3 `@42891 `@ @@42850@@l42,8f  g f  g 50f  g g]4 3 @@42850 @@  @@D@g4f  g f  g 1f  g bX: 3  @@ , D@ ,bDelaware PF  @23522@P23,522 lb4 3 @23522 @ S@22862S@l22,86f  g f  g 2f  g g]4 3 S@22862 S@  @@@g66f  g f  g 0f  g bX: 3  @@ , @ ,bDistrictof  Columbia OEl  @6658@O6,658 j`33 @6658 @ @6658@j6,658 f\33 @6658 @  @@f0 bX:3  @@ ,  ,bIllinois QGl  A278146AQ278,146 nd5l 3 A278146 A tA270493tAn270,493 h^5l 3 tA270493 tA  @@@h7,653 bX:l !3  @@ , @ ,bIndiana QGl "  A234625 AQ234,625 nd5l #3  A234625  A  A229913 An229,913 h^5l $3  A229913  A  @@h@h4,712 bX:l %3  @@ , h@ ,bKentucky QGl & &A165075&AQ165,075 nd5l '3 &A165075 &A A162242An162,242 h^5l (3 A162242 A  @@"@h2,833 bX:l )3  @@ , "@ ,bMaryland PFl * p2@82727p2@P82,727 lb4l +3 p2@82727 p2@ @@81892@@l81,892 g]4l ,3 @@81892 @@  @@@g835 bX:l -3  @@ , @ ,bMassachusetts PFl. @85871@P85,871 lb4l/3 @85871 @ `@84838`@l84,838 g]4l03 `@84838 `@  @@$@g1,033 ]S:l13  @@ , $@ ,]Michigan QGl2 (nA191941(nAQ191,941 nd5l33 (nA191941 (nA `LA190860`LAn190,860 lb5l43 `LA190860 `LA @1081@l1,081 aW9l53 @1081 , @ ,aNewJersey PFl6 h@95882h@P95,882 lb4l73 h@95882 h@ @96876@l96,876 g]4l83 @96876 @  @@g-994 bX:l93  @@ ,  ,bNewYork QGl:  A241981 AQ241,981 nd5l;3  A241981  A T A240285T An240,285 h^5l<3 T A240285 T A  @@@h1,696 bX:l=3  @@ , @ ,bNorthCarolina QGl>  A171332 AQ171,332 nd5l?3  A171332  A #A164987#An164,987 h^5l@3 #A164987 #A  @@ɸ@h6,345 bX:lA3  @@ , ɸ@ ,bOhio QGlB A252282AQ252,282 nd5lC3 A252282 A lA249241lAn249,241 h^5lD3 lA249241 lA  @@§@h3,041 bX:lE3  @@ , §@ ,bPennsylvania QGlF ]A268158]AQ268,158 nd5lG3 ]A268158 ]A xpA257551xpAn257,551 h^5lH3 xpA257551 xpA  @@@h10,607 bX:lI3  @@ , @ ,bRhodeIsland OElJ @9570@O9,570 j`3lK3 @9570 @ Q@9378Q@j9,378 f\3lL3 Q@9378 Q@  @@h@f192 bX:lM3  @@ , h@ ,bSouthCarolina QGlN 0@1277560@Q127,756 nd5lO3 0@127756 0@  @123056 @n123,056 h^5lP3  @123056  @  @@\@h4,700 bX:lQ3  @@ , \@ ,bTennessee QGlR XA201163XAQ201,163 nd5lS3 XA201163 XA +A198015+An198,015 h^5lT3 +A198015 +A  @@@h3,148 bX:lU3  @@ , @ ,bVirginia QGlV A186689AQ186,689 nd5lW3 A186689 A A180154An180,154 h^5lX3 A180154 A  @@@h6,535 bX:lY3  @@ , @ ,bWestVirginia PFlZ P@85045P@P85,045 lb4l[3 P@85045 P@ v@83822v@l83,822 g]4l\3 v@83822 v@  @@@g1,223J@>l]3  @@ ,  @ J F.HowWilltheComplianceSupplementPoolsbeHandled?  "_   ` Thecompliancesupplementpoolisapoolofallowances #a thatcanbeusedinthebeginningoftheprogramtoprovide w%Pc affectedsourcesadditionalcomplianceflexibilityinorder ' e toaddressconcernsraisedbycommentersontheSIPCall ("g proposalregardingelectricreliability.IntheSIPCall o*H$i Rule,thecompliancesupplementpoolmaybeusedinthe ,%k years2003and2004(see63FR5742857430,October27, ' 1998,forfurtherdiscussionofthecompliancesupplement  pool).InMichigan,theCourtofAppealsfortheDistrict w P ofColumbiaCircuitruledthatMay31,2004,ratherthanMay   1,2003isthedatebywhichsourcesmustinstallcontrols   tocomplywiththeSIPCall.Consequently,tobeconsistent oH  withtheoriginal2yearwindowspecifiedintheSIPCallin   whichweallowedthecompliancesupplementpoolallowances   tobeused,weareextendingthetimethatallowancesfrom g@  thecompliancesupplementpoolcanbeusedfromSeptember  30,2004toSeptember30,2005.Wearealsoproposingto  includecompliancesupplementpoolsforGeorgiaand _8 Missouri.AsundertheoriginalNOxSIPCall,Georgiaand  Missourimaydistributetheallowancesintheirrespective  poolseitherbasedonearlyreductions,directlytosources W0 basedonademonstratedneed,orbysomecombinationofthe  twomethods.(Foramorecompletediscussionofhow    compliancesupplementpoolallowancesmaybedistributed O"(" undertheNOxSIPcallsee63FR57429.)Theallowances #$ fromGeorgiasandMissouriscompliancesupplementpools %x& maybeusedtoaccountforemissionsduringthefirst2 G' !( yearsozoneseasonsthatsourcesinthoseStatesare ("* requiredtocomply. *p$, Ѐ ` WearenotproposingtochangetheindividualState ?,&. compliancesupplementpoolvaluesthatwerefinalizedinthe ' March2,2000technicalcorrectionstotheemissionbudgets  (65FR11222)withtheexceptionofAlabama,Georgia, w P Michigan,Missouri,andWisconsin.ChangingtheState   compliancesupplementpoolstoreflecttheStatebudget   changesmadeinthisactionwouldresultinminimalimpacts oH  onthesizeofanyStatescompliancesupplementpool.   Therefore,wehavedecidedtomaintainthecompliance   supplementpoolsatthelevelsdeterminedintheMarch2, g@  2000technicalamendment(withtheexceptionofAlabama,  Georgia,Michigan,Missouri,andWisconsin).   ` SincetheproposedrequiredreductionsinGeorgia, _8 Missouri,Alabama,andMichiganarelessthantherequired  reductionsoftheSeptember24,1998NOxSIPCallreflecting  fullStateemissionsbudgets,weproposetomake W0 correspondingdecreasestothecompliancesupplementpools  fortheportionofeachStatethatisstillsubjecttothe    SIPCall.WeproposetocalculatethepartialState O"(" compliancesupplementpoolsbyproratingthesizeofthe #$ fullStatecompliancepoolbytheratioofthereductions %x& thatweareproposingforthepartialStatetothe G' !( reductionsthatwerequiredintheMarch2,2000Technical ("* Amendment(65FR11222).However,tobeconsistentwiththe *p$, waythecompliancesupplementpoolwascalculatedinthe ?,&. otherStates,weareassuminga90percentreductionfromIC ' enginesforpurposesofcalculatingthecompliance  supplementpool.Inaddition,sinceWisconsinisnotbeing w P requiredtomakereductionsatthistime,Wisconsinisno   longerreceivingashareofthecompliancesupplementpool.   (Wisconsinsoriginalcompliancesupplementpoolwas6,920 oH  tons.)Forthesereasons,thetotalcompliancesupplement   poolisnowlessthan200,000tons.Therevisedcompliance   supplementpoolsforGeorgia,Missouri,Alabama,and g@  MichiganareshowninTable9.   ` Table9.ComplianceSupplementPools(CSP)   *!W"dddd Pdd dd dd HIWI(#(#,dd ,dd ,dd ,dd ,dd +  wPwP    FullState  TonsReduced  (fromMarch t 2,2000FR) '{T 'PartialState  TonsReduced  With90%IC t Engine {T Control [4   FullState ! CSP  "  Partial # StateCSP $ With90%IC t% Engine {T& _Control _  [4' GA A7 (  @63582 @A63,582 lb4)3  @63582  @ "@57623"@l?+ 4 <DL!X?57,623 cY4*3 "@57623 "@ X@11440X@c11,440 ZP++ X@11440 X@ @10728@Z10,728 7-+, @10728 @ 7MO A7 7- @d@62242@d@A62,242 lb47.3 @d@62242 @d@ @31291@l31,291 cY47/3 @31291 @ @11199@c11,199 YO+70 @11199 @ @5630@Y5630 6,*71 @5630 @ 6AL A7  x2 @@64954@@A64,954 lb4 x33 @@64954 @@ Q@49806Q@l49,806 cY4 x43 Q@49806 Q@ @11687@c11,687 YO+ x5 @11687 @ @8962@Y8962 6,* x6 @8962 @ 6MI A7 "7 @63118@A63,118 lb4"83 @63118 @ @55064@l55,064 cY4"93 @55064 @ .@11356.@c11,356 YO+": .@11356 .@ Y@9907Y@Y9907:0."; Y@9907  Y@ : G.WilltheEGUBudgetChangesAffecttheStatesIncluded #; intheThreeStateMemorandumofUnderstanding?  %x=  ` InFebruary1999,Connecticut,Massachusetts,Rhode _'8!? Island,andEPAsignedaMemorandumofUnderstanding(the )"A threeStateMOU).ThethreeStateMOUredistributed *$C Connecticut,Massachusetts,andRhodeIslandsEGUemissions W,0&E budgetstominimizethesizedifferentialbetweentheirEGU ' budgetsundertheNOxSIPCallandPhaseIIIoftheOzone  TransportCommission(OTC)NOxBudgetprogram.Italso w P reallocatedthethreeStatescompliancesupplementpools.   ЀUnderthethreeStateMOU,Connecticut,Massachusetts,   andRhodeIslandwouldcollectivelybemeetingtheirNOxSIP oH  Callreductionresponsibilitiesbecausethebudget   redistributiondidnotresultinahighercombinedoverall   EGUbudgetforthethreeStates.Wetookactionto g@  implementthethreeStateMOUandconcurrentlypublished  proposedanddirectfinalrulesonSeptember15,1999(64FR  50036and49987).Wesubsequentlywithdrewthedirectfinal _8 ruleonNovember1,1999duetothereceiptofadverse  comment(64FR58792).TheEGUbudgetsproposedintodays  actionwouldnotaffecttheEGUbudgetsforConnecticut, W0 Massachusetts,andRhodeIslandthatweproposedinresponse  tothethreeStateMOU.Wedidnotfinalizetheproposalto    actonthethreeStateMOU.Instead,weproposedtoapprove O"(" thethreeStatesNOxSIPcallSIPsubmittals,withbudgets #$ thatreflectedthethreeStateMOU,ascollectivelymeeting %x& theirNOxSIPcallbudgets.Wedidnotreceiveanycomments G' !( ontheproposedapprovalofthesethreeStatesSIPsand ("* finalizedapprovalofthemonDecember27,2000. *p$,  H.HowDoestheTerm BudgetRelatetoConformityBudgets? ?,&.   ` Wewishtoclarifythattheuseoftheterm budgetin ' thisactiondoesnotrefertothetransportationconformity  rulesuseoftheterm motorvehicleemissionsbudget, w P definedat40CFR93.101.Thebudgetsproposedtodaydonot   setbudgetsforspecificozonenonattainmentareasforthe   purposesoftransportationconformity.Transportation oH  conformitybudgetscannotbetieddirectlytotheSIPCall   budgetsbecausethelatterareforalloralargepartof   theStateandtheformerarenonattainment-area-specific. g@   ! ! FornonattainmentormaintenanceareasinaStatecoveredby  theSIPCall,transportationconformitybudgetsmustreflect  themobilesourcecontrolsassumedintheSIPCallbudgets _8 totheextentthattheattainmentSIPultimatelyreliesupon  thosecontrols.   I.HowWillPartialStateTradingbeAdministered?  W0  ` InthefinalNOxSIPCall,weofferedtoadministera  multiStateNOxBudgetTradingProgramforStatesaffected    bytheNOxSIPCall.Intodaysaction,weareproposingto g"@" includeonlypartialStatebudgetsforAlabama,Georgia, $$ Michigan,andMissouri.Therefore,weareofferingto %& administeratradingprogramfortheNOxSIPCallregion _'8!( that,forthesefourStates,includesonlytheportionof )"* theStatesproposedforinclusionintheNOxSIPCall.In *$, thefinalNOxSIPCall,aswellastheJanuary18,2000 W,0&. finalrulemakingontheoriginaleightSection126 ' petitions,weauthorizedsourcesinStatesaffectedby  eithertheNOxSIPCallortheSection126rulemakingto w P tradewitheachotherthroughthemechanismsoftheNOx   BudgetTradingProgramprovidedcertaincriteriaweremet.   ThesecriteriaincludedthatStatesmustbesubjecttothe oH  NOxSIPCallandthatStatesmustmeettheemissioncontrol   levelunderthefinalrulefortheNOxSIPCall.The   justificationforallowingtradingacrossStatesisthetest g@  ofsignificantcontributionwhichunderliesboththeSection  126rulemakingandtheNOxSIPCall.Therefore,atthis  time,onlysourcesintheportionsoftheStatesforwhicha _8 findingofsignificantcontributionhasbeenmadeand  budgetshavebeenestablishedwouldbeallowedto  participateintradingwithsourcesinStateswhichare W0 subjecttoeithertheNOxSIPCallortheSection126  rulemaking.     e(j88! ! "3 "  3Ф2j  J  .3  0 `   WhatSIPSubmittalDatesAreWeProposing? 3Ф݌O"("` (#` (# Ќ   -(Uh88 e ` Intodaysaction,weareproposingarangeofdue $$ datesforStatestosubmitSIPsmeetingthePhaseIINOx %& budgetsandthepartialStatebudgetsforGeorgiaand _'8!( Missouri.Webelievethattheappropriate_timeframe_Ԁto )"* considerforSIPsubmittalis6monthsto1yearfromfinal *$, promulgationofthisrulemakingbutnolaterthanApril1, W,0&. 2003,andwerequestcommentonwhichdatewithinthis ' _timeframe_Ԁisappropriate.Webelievethatadeadlinewithin  thisrangewillallowadequatetimeforStatestopromulgate w P rules,andforsourcesaffectedbyaStatesPhaseIINOx   strategyandbyGeorgiaandMissourisNOxstrategyto   complywiththeregulationsbythedatesproposedinthis oH  action.PleaseseesectionK,below,foradiscussionof   thecompliancedates.    ` Inestablishingtheendoftherange,i.e.,April1, g@  2003,weconsideredthefactthattheoriginalNOxSIPCall  Ruleallowed12monthsfromthedateofpromulgationfor  SIPstobedue.Wearehopefulthatwewillfinalizethis _8 rulemakinginSpring2002.Thepurposeofhavinganend  datetotherangeistoensurethatsourcescancomplyby  thedatesdiscussedbelow,whichwillensurethatthe W0 reductionsnecessarytominimizeozonetransportoccur  expeditiously.     ` WebelievethataSIPsubmittalduedatewithinthe O"(" proposedrangewouldgiveStatesadequatetimetoadopt #$ rulesandgivesourcesadequatetimetoinstallcontrol %x& equipmentneededtocomply. G' !(  (88- "3"  32  A  .3  0 `   WhatComplianceDatesAreWeProposing? 3݌("*` (#` (# Ќ   (5H08 ` Therearetwoprimaryissuesthatneedtobeconsidered *$, whendeterminingareasonabledatebywhichEGUscoveredby W,0&. anyPhaseIISIPsorbySIPsinGeorgiaandMissouri,can ' installcontrolstoachievetheemissionsreductions  required: w P  o(80"3"   ` 3:2(  1  )3  0   Howlongdoesittaketocompletethedesign,   construction,andtestingofthecontrolsonlarge   boilersusedtogenerateelectricity?3:s݌oH  (# (# Ќ  ! !" ;"   ;߳0 ` 2(  2  )3  0 ` (#` (#  DoestheamountoftimethatEGUsaretakenoff   linetoinstallcontrolsadverselyaffectthe   reliabilityoftheelectricpowersystem?In g@  otherwords,doesinstallationofcontrolsreduce  theamountofavailablegenerationtothepoint  wherenopowercanbesuppliedtocertainusers _8 foraperiodoftime? ;߳ ݌ (# (# Ќ   ` Webelievecontrolequipmentcangenerallybeapplied  inanexpeditiousmanner.Forexample,controlsonIC W0 enginesmaybeinstalledinlessthan1year.Statesthat  choosetocontrollargeEGUs,however,mayexperiencelonger    _timeframes_Ԁforinstallationofpostcombustioncontrols. O"(" Forthisreason,weanalyzedthe_timeframe_Ԁrequiredto #$ installcontrolsonlargeEGUsaspartofourdecisionon %x& theappropriatecompliancedatetoset. G' !(  ` InanefforttoremainconsistentwiththeAugust30, ("* 2000CourtofAppealsdecisionregardingthecompliance *p$, dateforPhaseIoftheNOxSIPCall,weareproposinga ?,&. compliancedateofMay31,2004forPhaseIIsources.We ' areproposingaMay1,2005compliancedateforaffected  sourcesinGeorgiaandMissouri.Werequestcommentonthe w P feasibilityofthesecompliancedates.    ` GivenaPhaseIISIPsubmittaldateaslateasApril1,   2003,ownersandoperatorsofaffectedunitssubjectto oH  Statecontrolrequirementswouldhaveabout13months,and   affectedunitsinGeorgiaandMissouriwouldhaveabout25   monthstoinstallthenecessarycontrols.   g@   ` ThediscussionbelowsupportsaPhaseIISIPsubmittal  dateaslateasApril1,2003forthe19StatesandDistrict  ofColumbia,aswellasforGeorgiaandMissouri.Of _8 course,adoptingandsubmittingtheSIPearlierwould  provideadditionaltimefortheinstallationofcontrols.   1.WhatistheTechnicalFeasibilityoftheCompliance W0 Dates?    ` UnderSection126,weissuedafinalruledetermining    thatsourcesinninejurisdictions(Delaware,Districtof "X" Columbia,Maryland,NewJersey,NorthCarolina,Ohio, '$$ Pennsylvania,Virginia,andWestVirginia)andportionsof %& fourotherjurisdictions(Indiana,Kentucky,Michigan,and w'P!( NewYork)namedintheNOxSIPCallsignificantlycontribute )"* tononattainmentinoneormoreofthepetitioningStates. *$, AsfinalizedbyEPA,thatruledirectlyregulatedsources o,H&. GO{ Ge G  withinthe13StatesandrequiredcompliancebyMay1,2003  (64FR28250,May25,1999and65FR2674,January18,  2000).OnAugust24,2001,theD.C.Circuitissuedanorder , P intheAppalachianPower126Case,tollingthedatefor   implementingthecontrolsrequiredundertheSection126 |  Rule.Ouranalysisofthetimeneededtocomplywiththe $H  PhaseIIrulemakingisstillapplicableaslongassources   arerequiredtocomplywiththeSection126requirementsby t  May31,2004.Inaddition,aspartoftheOTCNOxBudget @  Program,theremainingNortheastStatescoveredintoday's  action(Connecticut,Massachusetts,NewYorkandRhode l Island)havesubmittedSIPs,whichwehaveapproved,to 8 complybyMay1,2003withtheNOxSIPCall.  ЀWeexaminedthetimeneededtoinstallthepost d combustioncontrols(SCRandSNCR)onlargeboilersusedto  0 generateelectricitybecausetheyrepresentthemosttime  consumingNOxcontrolretrofits.Inthisfeasibility \   analysis,welookedattheretrofitsweprojectedwere "(" neededforaffectedunitsinGeorgiaandMissouriandPhase #$ IIunitsintheremainingStatestocomplywiththeNOxSIP T%x& Call.TheseremainingStatesinclude:Alabama,Georgia, & !( Illinois,Missouri,SouthCarolina,andTennesseeand ("* portionsofIndiana,Kentucky,andMichigan. L*p$,  ` WebelievethatifStates(otherthanGeorgiaand +&. Missouri)submitSIPsbyAprilof2003,thereisstill  sufficienttimeforsourcestoinstallthenecessary  controlsbyMay31,2004.Todeterminetheamountoftime , P involved,weanalyzedwhichsourceswouldreasonablybe   expectedtobesubjecttothePhaseIIrule.WhileStates |  maymeettherequirementsoftheSIPCallbyrequiring $H  reductionsfromanysourcesthatareavailable,mostStates,   asameansofcompliancewithPhaseIoftheSIPCall,are t  choosingtorequirereductionsfromthesamegroupof @  sourcesthatweconsideredindeterminingthebudgets.  Therefore,webelieveitisreasonabletoassumethatStates l willalsoregulate,aspartoftheirPhaseIIcompliance 8 strategy,thesamesourcesthatweusedtodevelopthePhase  IIbudgets. d  ` OuranalysisshowedthatunderPhaseII,andassuming  0 themultistatetradingprogram,threesmallcoalburning  unitswouldelecttoinstallSNCRcontroltechnology \   (September2000Feasibilitymemorandum,docket#A9656, "(" item#XIIK46).Weprojectedthatmostoftheotherunits #$ wouldnotneedtoinstallpostcombustioncontrolsbecause T%x& theywereeitheralreadyunderanemissionrateof0.15 & !( lbs/_mmbtu_,ortheywereinfrequentlyoperatedsourcesthat ("* wouldfinditmoreeconomicaltopurchaseallowancesthanto L*p$, installpostcombustioncontrolequipment.Although +&. installationofSNCRmayinsomecasesbetimeconsuming,we  believethatthesesourceswillbeabletocomplybytheMay  31,2004compliancedateforseveralreasons.First,weare , P settingemissionbudgetsfortheyear2004basedona5   monthozoneseason.BecauseStatesarerequiredtosubmit |  SIPsthatdemonstratecompliancewithonlya4monthperiod $H  in2004,theiremissionbudgetswillbelargerthanneeded   tomeetanemissioncapof0.15lbs/_mmbtu_Ԁin2004. t  Therefore,Stateswillhavemorethantheirsourcesneedto @  achievethe0.15lb/mmBtulevelin2004.TheStateswill  haveflexibilitytoallocatetheseallowancesrecognizing l thatsomesources!suchasthethreesourcesnotedabove! 8 mayneedextratimetocomply.   ` Furthermore,eventhoughweprojectedthatitwould d take19monthstoinstallSNCR,theactualinstallation  0 processisprojectedtotakeonly8months.Themajorityof  the19monthinstallationisrelatedtoobtaininga \   constructionpermit(9months).Becausesourcesshouldhave "(" astrongindicationofwhethertheyaregoingtobe #$ regulatedunderaStatesPhaseIIrulemakingbeforethe T%x& rulemakingiscomplete,sourcescouldbeginthisprocess & !( beforeaStatesrulewasfinalized.Inaddition,because ("* onlyasmallnumberofsourcesareinvolved,Statesmayhave L*p$, opportunitiestoexpeditetheirconstructionpermitting +&. process.   ` However,forsourcesinthefinegridportionsof  GeorgiaandMissouri,weproposeaMay1,2005compliance , P date.Thisdatewillgivethem25monthstoinstall   necessarycontrolsifStatessubmitSIPsbyApril1,2003. |  InMissouri,atmostthreeinstallationsofSNCRare $H  projected,ortwoinstallationsofSCRandoneinstallation   ofSNCR.InGeorgia,installationswouldbenotmorethan t  seven_SNCRs_,ortwoSCRsandoneSNCR.Inouranalysis,we @  projectedthattwoSCRsandoneSNCRcouldbeinstalledin  lessthan25monthsandthatsevenSNCRscouldbeinstalled l in23months(September2000Feasibilitymemorandum,docket 8 #A9656,item#XIIK46).Furthermore,sourcesinboth  GeorgiaandMissouriarealreadyinstallingsomepost d combustioncontrolstocomeintocompliancewithozone  0 nonattainmentSIPs.Inaddition,becausemuchofthework  thatwillbedoneinGeorgiaandMissouriwillbedoneafter \   postcombustioncontrolshavebeeninstalledinmanyother "(" States,sourcesintheseStateswillbeabletotake #$ advantageofexpertisegainedintheseotherinstallations T%x& toreducetheamountoftimerequiredtoinstallthe & !( controls.Forthesereasons,webelievetheMay1,2005 ("* implementationdateisfeasibleforGeorgiaandMissouri. L*p$,  ` WearealsoawarethatStatescouldchoosetoutilize +&. thecompliancesupplementpooltoassistunitsthat  demonstrateaneedforalongercompliance_timeframe_,  particularly,thesmallnumberofunitsinPhaseIIStates , P thatmightdecidetoinstallpostcombustioncontrols.   Furthermore,sourcescouldchoosetousethetradingsystem |  tohelpmeetthesecompliancedates,eitherbypurchasing $H  creditsfromotherpartiesorbybankingemissionsatother   unitstheycontrolandusingthosecreditsasneeded. t   2.0 ` HowWillThisAffectElectricReliability? @ ` (#` (#  ` Concernsaboutelectricreliabilityarisewhenever  unitsaredown,particularlyduringperiodsofpeakdemand.  Sinceunitsmayneedtobeofflineforlongerperiodsof ,P timetoinstallemissioncontrolsthantheynormallywould  beiftheunitswerejustbeingshutdowntoperformother | scheduledmaintenance,theinstallationofemissioncontrols $H mayincreaseconcernsaboutreliability.Thepotential  impactvariesdependingonthenumberofunitsthathaveto t   installcontrols,theadditionaltimethattheseunitshave "@" tobetakenoffline,andthenumberofunitsthatareoff #$ lineatonetime. l%&  ` WedonotanticipatethattheinstallationofNOx '8!( controls,includingSCR,willthreatenthereliabilityof ("* thepowersupply,evenduringthesummermonthswhenthe d*$, demandforelectricityishighest.SinceSCRisapost  ,0&. combustioncontroldevicethatisnotpartoftheboiler,  mostoftheSCRretrofitcanbeconstructedwhiletheboiler  isoperatingtosupplyelectricity.Theboilerneedstobe , P turnedoffonlywhentheSCRisactuallyconnectedtothe   ductsleavingtheboiler.Ownersandoperatorsofelectric |  powerplantsnormallyscheduleconnectionsofthesecontrols $H  duringoffpeakperiods(usuallyspringorfall),whenthey   alreadyplantoshutdowntheunittoperformother t  scheduledmaintenance. @   ` TheEPAandindustrygroupsexaminedthereliabilityof  thepowersupplyinthecontextofaMay2003compliance l datefortheentireNOxSIPcallregion.Basedonthese 8 studies,weconcludedthatinstallationofNOxcontrolsfor  theentireNOxSIPCallregion(includingPhaseIandPhase d IIaffectedunitsandaffectedunitsinGeorgiaand  0 Missouri)byMay1,2003willnotthreatenthereliability  oftheelectricpowersupply.Therefore,weconcludethat \   providingadditionaltime(anadditionalyearand1month) "(" fortheinstallationofcontrolsonsomeoftheaffected #$ unitsfurtherensuresthatthereliabilityoftheelectric T%x& powersupplywillnotbethreatenedbythisrule. XXXX;X;XXX  25       & !( p$     ` a.ReliabilityinGeorgiaandMissouri   ` InthefinalNOxSIPCallandthefinalSection126  Rule,weincludedthecompliancesupplementpooltoaddress , P commentersconcernsregardingelectricityreliability.   Therefore,toremainconsistentwiththeintentofthe |  originalNOxSIPCall,weareproposingtoinclude $H  compliancesupplementpoolsforGeorgiaandMissouri.As   undertheoriginalNOxSIPCall,GeorgiaandMissourimay t  distributetheallowancesintheirrespectivepoolseither @  basedonearlyreductions,directlytosourcesbasedona  demonstratedneed,orbysomecombinationofthetwo l methods.(Foramorecompletediscussionofhowcompliance 8 supplementpoolallowancesmaybedistributedundertheNOx  SIPcallsee63FR57429.)Theallowancesfromthepools d maybeusedtoaccountforemissionsduringthefirsttwo  0 ozoneseasonsthatGeorgiaandMissouriarerequiredto  comply,whichunderthisproposalwouldbein2005and2006. \   Thesizeoftheircompliancesupplementpoolshavebeen "(" adjustedtoaccountfortheproposedchangeingeographic #$ coverage.Seesection_II.F._Ԁoftodaysactionfora T%x& completediscussionofhowthesizeofGeorgiaand  Missouriscompliancesupplementpoolswerecalculated.   ` Withalatercompliancedate(May1,2005asproposed) , P thantherestoftheSIPCallregionandtheSection126   region,webelievethatconcernsabouttherisktoelectric |  reliabilityduetotheinstallationofcontrolsinGeorgia $H  andMissouriarenotjustified.SourcesinbothGeorgiaand   MissouriareexpectedtoinstallsomeNOxcontrolsbefore t  May1,2005aspartoftheStatesozoneattainmentplans. @  Furthermore,byMay1,2005,weexpecttheretobeanactive  NOxallowancemarketonwhichsourcesinGeorgiaand l Missouricouldrelyshouldtheyexperienceanunexpected 8 delayininstallingcontrols.   L.WhatAreWeProposingforWisconsin?    d  ` IntheNOxSIPCalllitigation,theWisconsinindustry $H petitionersarguedthattheemissionsfromWisconsindonot  contributesignificantlytononattainmentinanyother t   State.Section110(a)(2)(D)(i)(I)requiresthataState "@"  contributesignificantlytononattainmentin...anyother #$ StateinordertobeincludedinthechallengedSIPCall. l%& 42U.S.C.7410(a)(2)(D)(i)(I).TheCourtheldthat EPA '8!( erroneouslyincludedWisconsinintheNOxSIPCallbecause ("* EPAfailed d*$, ЀtoexplainhowWisconsincontributestononattainmentin  ,0&. anyotherState,213F.3dat361(emphasisinoriginal).  TheCourtnotedthattherecordshowedonlythatemissions  fromWisconsincontributetoviolationsofthestandardover D h LakeMichigan.    ` Our zerooutmodelingofWisconsinemissionsusing   UAMVshowsthatemissionsfromWisconsinimpactozone <`  levelsinneighboringStates,butnotduringexceedancesof   the1hourNAAQS(i.e.,theseimpactsoccurwhenozone   levelsarebelowtheNAAQS).FortheOTAGepisodeswe 4X  modeled,theozoneimpactsofWisconsinon1hour  nonattainmentarepredictedinthenorthwesternpartofLake  MichiganneartheshorelineofWisconsin.IntheNOxSIP ,P Callrulemaking,weconcludedthatimpactsoverthelake  shouldbeconsideredascontributionstoStatesbordering | thelake(i.e.,Michigan,Indiana,andIllinois)becauseof $H lakebreezeeffects(63FR57386,October27,1998).The  Courtfoundthatwehadnotprovidedadequatesupportfor t   thisdeterminationandvacatedtherulesapplicationto "@" Wisconsinforthe1hourstandard(Michiganv.EPA,213F.3d #$ at681). l%&  ` Weagreethatadditionalmodelingwouldbenecessaryin '8!( ordertofindthatWisconsinsignificantlycontributesto ("* downwind1hournonattainmentinanyotherStateandto d*$, includeWisconsinintheNOxSIPCallatthistime.Since  ,0&. wedonotcurrentlyhavethemodelingnecessarytomakesuch  aproposal,weintendtoexcludetheentireStateof  Wisconsinfromtherequirementsofthe1hourbasisofthe , P NOxSIPCalltoconformtotheCourtsdecision.    ` Wearenot,however,proposingtodeterminethat |  Wisconsinsemissionsdonotcontributesignificantlyto $H  nonattainmentdownwind.Wehavenotcompletedthe   additionalmodelinganalysisfortheStatesthatarepartof t  theOTAGregionbutwerenotincludedinthefinalNOxSIP @  Call.InthefinalNOxSIPCall,wetooknoactionon  whetheremissionsfromsourcesin15States X;XXX;  26      ׀intheOTAG l regiondoordonotcontributesignificantlytodownwind 8 nonattainment,orinterferewithmaintenancedownwind,under  eitherthe1hourorthe8hourozoneNAAQS.Wewill d continuetoreviewavailableinformationonthedownwind  0 impactsoftheseStates.Weplantolookattheimpactsof  Wisconsininconjunctionwithanyfurtheranalysisonthe \   remaining15States.Todate,wehavestayedthe8hour "(" basisoftheSIPCallRule(65FR56245,September18,2000) #$ andtheCourthasstayedconsiderationofthe8hourbasis T%x& oftheSIPCallRule.TodaysactiontoexcludeWisconsin & !( fromthe1hourbasisoftheSIPCalldoesnotaddress ("* whetherWisconsinshouldremainsubjecttothe8hourbasis  oftheSIPCall.Wewilladdressthatissueatthetimeit  liftsthestayasitappliestoWisconsin. , P  M.HowArethe8hourNAAQSRules AffectedbythisAction?     ` Asnotedabove,therevisionstotheNOxSIPCall   proposedintodaysactionrespondtotheCourtsdecision <`  inMichiganv.EPA.TheCourtsdecisionandtodays   proposalconcernissuesarisingunderonlythe1hourozone   NAAQS,andnotthe8hourNAAQS.Accordingly,noneofthe 4X  actionsproposedtodaythedefinitionofEGUandthe  controlrequirementsforICengines,andimplicationsfor  theStatebudgets;theSIPsubmissiondates;therevised ,P emissionsbudgetsforAlabama,Georgia,Michigan,and  Missouri;andtheexclusionofWisconsiniffinalized, | wouldhaveanyeffectonanyrequirementsoftheSIPCallon $H Statesunderthe8hourNAAQS.Becauseofthelitigation  concerningthe8hourozoneNAAQS,wehavestayedallofthe t   requirementsoftheSIPCallunderthe8hourNAAQS,ranging "@" fromtheSIPsubmissiondatestothecontrolrequirements #$ (65FR56245,September18,2000).Afterthelitigation l%& concerningthe8hourNAAQSisresolved,wewilldetermine '8!( whethertoproceedwiththe8hourrequirementsunderthe ("* SIPCall. d*$,  III.WhatAretheAdministrativeRequirements?   ,0&. К A.0 ` ExecutiveOrder12866:RegulatoryImpactAnalysis ` (#` (#  ` UnderExecutiveOrder12866(58FR51735,October4,  1993),theAgencymustdeterminewhethertheregulatory D h actionis"significant"and,therefore,subjecttoOfficeof   ManagementandBudget(OMB)reviewandtherequirementsof   theExecutiveOrder.TheOrderdefines"significant <`  regulatoryaction"asonethatislikelytoresultinarule   thatmay:    ` 1.Haveanannualeffectontheeconomyof$100 4X  millionormoreoradverselyaffectinamaterialwaythe  economy,asectoroftheeconomy,productivity,competition,  jobs,theenvironment,publichealthorsafety,orState, ,P local,ortribalgovernmentsorcommunities;   ` 2.Createaseriousinconsistencyorotherwise | interferewithanactiontakenorplannedbyanotheragency; $H  ` 3.Materiallyalterthebudgetaryimpactof  entitlements,grants,userfees,orloanprogramsorthe t   rightsandobligationsofrecipientsthereof;or "@"  ` 4.Raisenovellegalorpolicyissuesarisingoutof #$ legalmandates,thePresident'spriorities,orthe l%& principlessetforthintheExecutiveOrder. '8!(  ` Thisproposedaction,whichrespondstothecourt ("* decisionsinMichiganv.EPA,213F.3d663(D.C.Cir. d*$, 2000)(NOxSIPCall);AppalachianPowerv.EPA,249F.3d1032  ,0&. (D.C.Cir.2001)(Section126Rule),andAppalachianPowerv.  EPA,251F.3d1026(D.C.Cir.2001)(NOxSIPCallTechnical  Amendments),isa significantregulatoryactionunder , P ExecutiveOrder12866becauseitraisesnovellegalor   policyissuesandis,therefore,subjecttoreviewbyOMB. |   ` Sincethisisa significantregulatoryaction,a $H  RegulatoryImpactAnalysis(RIA)isrequired.Weareusing   theoriginal_RIAs_Ԁpreparedforthethreeactionsatissuein t  thecaseslistedabove[ RegulatoryImpactAnalysisforthe @  NOxSIPCall,FIP,andSection126Petitions(DocketA96  56)]and[ RegulatoryImpactAnalysisfortheFinalSection l 126Rule(DocketA9743)],whichcontaincostandbenefit 8 analysesandeconomicimpactanalysesreflecting  requirementsofthoserules.Inaddition,weareusingan d updatetosomeoftheinformationinthefinalNOxSIPCall  0 RIAentitled, NOxEmissionsControlCostsforStationary  ReciprocatingInternalCombustionEnginesintheNOxSIP \   CallStates(August11,2000),ananalysispreparedforthe "(" ICengineportionofthisaction.Thisanalysisindicates #$ thatthereislesscostincurredperenginethanshownin T%x& theoriginalRIAwhichwaspreparedforthefinalNOxSIP & !( Call.Thisdocumentisavailableforpublicinspectionin ("* DocketA9656whichislistedintheADDRESSESsectionof L*p$, thispreamble.  +&.  (88o! !"3"  32  B  .3  0 `   ݀ExecutiveOrder12898:EnvironmentalJustice 3݌` (#` (# Ќ   ` Thisactiondoesnotinvolvespecialconsiderationof  environmentaljusticerelatedissuesasrequiredby D h ExecutiveOrder12898(59FR7629,February16,1994).For   thefinalNOxSIPCallandSection126Rules,theAgency   conductedgeneralanalysesofthepotentialchangesinozone <`  andparticulatematterlevelsthatmaybeexperiencedby     minorityandlowincomepopulationsasaresultofthe   requirementsoftheserules.Thesefindingswerepresented 4X  intheRIAforeachoftheserules.Todaysactiondoesnot  affecttheseanalyses.   c(ʽ88  C.ExecutiveOrder13045:ProtectionofChildrenfrom ,P EnvironmentalHealthRisksandSafetyRisks    ` ExecutiveOrder13045: ProtectionofChildrenfrom  EnvironmentalHealthRisksandSafetyRisks(62FR19885, Tx April23,1997)appliestoanyrulethat(1)isdetermined   tobe economicallysignificantasdefinedunderExecutive    Order12866,and(2)concernsanenvironmentalhealthor L"p" safetyriskthatEPAhasreasontobelievemay havea #$ disproportionateeffectonchildren.Iftheregulatory %& actionmeetsbothcriteria,theAgencymustevaluatethe \'!( environmentalhealthorsafetyeffectsoftheplannedrule )(#* onchildren,andexplainwhytheplannedregulationis *$, preferabletootherpotentiallyeffectiveandreasonably T,x&. feasiblealternativesconsideredbytheAgency.   ` TheEPAinterpretsExecutiveOrder13045asapplying g onlytothoseregulatoryactionsthatarebasedonhealthor P safetyrisks,suchthattheanalysisrequiredundersection   5-501oftheOrderhasthepotentialtoinfluencethe _  regulation.This actionisnotsubjecttoExecutiveOrder  H  13045becauseitdoesnotconcernanenvironmentalhealthor   safetyriskthatwehavereasontobelievemayhavea W  disproportionateeffectonchildrenanditisnot @  economicallysignificantunderExecutiveOrder12866.   D.ExecutiveOrder13132:Federalism  O HeHe ` ExecutiveOrder13132,entitled Federalism(64FR P 43255,August10,1999),requiresEPAtodevelopan  accountableprocesstoensure meaningfulandtimelyinput _ byStateandlocalofficialsinthedevelopmentof H regulatorypoliciesthathavefederalismimplications.   Policiesthathavefederalismimplicationsisdefinedin W  theExecutiveOrdertoincluderegulationsthathave  @"  substantialdirecteffectsontheStates,onthe "$ relationshipbetweenthenationalgovernmentandtheStates, O$& oronthedistributionofpowerandresponsibilitiesamong %8!( thevariouslevelsofgovernment.Undersection6of '"* ExecutiveOrder13132,EPAmaynotissuearegulationthat G)$, hasfederalismimplications,thatimposessubstantialdirect *0&. compliancecosts,andthatisnotrequiredbystatute, ,'0 unlesstheFederalgovernmentprovidesthefundsnecessary  topaythedirectcompliancecostsincurredbyStateand g localgovernments,orEPAconsultswithStateandlocal P officialsearlyintheprocessofdevelopingtheproposed   regulation.TheEPAalsomaynotissuearegulationthat _  hasfederalismimplicationsandthatpreemptsStatelaw,  H  unlesstheAgencyconsultswithStateandlocalofficials   earlyintheprocessofdevelopingtheproposedregulation. W   (5H08c ` ThisproposedactionaddressingtheNOxSIPCalland @  Section126Rulesdoesnothavefederalismimplications.It  willnothavesubstantialdirecteffectsontheStates,on O therelationshipbetweenthenationalgovernmentandthe 8 States,oronthedistributionofpowerandresponsibilities  amongthevariouslevelsofgovernment,asspecifiedin G ExecutiveOrder13132. 0  ` InissuingtheSIPCall,EPAactedundersection  110(k)(5),whichrequirestheAgencytorequireaStateto ?  correctadeficiencythatEPAhasfoundintheSIP.In  (" October1998,EPAissueditsfinalSIPCallRulefinding "$ thattheSIPsfor22StatesandtheDistrictofColumbia 7$x& weresubstantiallyinadequatebecausetheydidnotregulate % !( emissionsthatsignificantlycontributetodownwind '"* nonattainmentinotherStates.OnMarch3,2000,theD.C. /)p$, Circuitlargelyupheldthatrulebutremandedcertainminor *&. issuesandvacatedandremandedotherminorissuestothe ,'0 Agencyforfurtherconsideration.Michiganv.EPA,213F.3d  663(D.C.Cir.2000)(NOxSIPCall).Today,EPAisproposing g actionontheseremandedandremandedandvacatedportions P oftherule.Thisactionalsorespondstoanissuethatthe   courtremandedandvacatedinthechallengetotheNOxSIP _  CallTechnicalAmendments.AppalachianPowerv.EPA,251  H  F.3d1026(D.C.Cir.2001)(NOxSIPCallTechnical   Amendments). W   ` Withrespecttotheproposedactionconcerningthe @  definitionofEGUandthelevelofcontrolforinternal  combustionengines,theproposedactionrevisingthe O emissionbudgetsforGeorgia,Missouri,Alabama,and 8 Michigan,andtheSIPsubmissionandsourcecompliance  dates,EPAsproposaldoesnotimposeanyadditionalburdens G beyondthoseimposedbythefinalNOxSIPCall.Thus, 0 todaysactiondoesnotaltertherelationshipestablished  bythefinalSIPCallRule,whichremainsinplacefor19 ?  States(includingAlabamaandMichigan)andtheDistrictof  (" Columbia.Moreover,noaspectoftheproposedrulechanges "$ theestablishedrelationshipbetweentheStatesandEPA 7$x& undertitleIoftheCAA.UndertitleIoftheCAA,States % !( havetheprimaryresponsibilitytodevelopplanstoattain '"* andmaintaintheNAAQS.Asfoundbythecourt,theStates /)p$, havefulldiscretionundertheSIPCallRuletochoosethe *&. controlrequirementsnecessarytoaddressthetransported ,'0 emissionsidentifiedbyEPAintheSIPCall.   ` AsprovidedinthefinalactionpromulgatingtheSIP g CallandtheTechnicalAmendments,theSIPCallwillnot P imposesubstantialdirectcompliancecosts.Whilethe   Stateswillincursomecoststodeveloptheplan,those _  costsarenotexpectedtobesubstantial.Moreover,under  H  section105oftheCAA,theFederalgovernmentsupportsthe   StatesSIPdevelopmentactivitiesbyprovidingpartial W  fundingofStateprogramsforthepreventionandcontrolof @  airpollution.Thus,therequirementsofsection6ofthe  ExecutiveOrderdonotapplytothisrule. O  ` TodaysrulealsorespondstotheCourtsdecisionin 8 AppalachianPowerv.EPA,249F.3d1032(D.C.Cir.  2001)(Section126Rule).Thisactionimposesnonew G requirementsthatimposecomplianceburdensbeyondthose 0 thatEPAestablishedunderthefinalSection126Rule  (January18,2000). ?   E.! !ExecutiveOrder13175:ConsultationandCoordination  (" withIndianTribalGovernments  "$  ` ExecutiveOrder13175,entitled Consultationand g$& CoordinationwithIndianTribalGovernments(65FR67249, &P!( November6,2000),requiresEPAtodevelopanaccountable '"* processtoensure meaningfulandtimelyinputbytribal _)$, officialsinthedevelopmentofregulatorypoliciesthat +H&. havetribalimplications. Policiesthathavetribal ,'0 implicationsisdefinedintheExecutiveOrdertoinclude  regulationsthathave substantialdirecteffectsononeor g moreIndiantribes,ontherelationshipbetweentheFederal P governmentandtheIndiantribes,oronthedistributionof   powerandresponsibilitiesbetweentheFederalgovernment _  andIndiantribes.  H   ` Thisproposedruledoesnothavetribalimplications.   Itwillnothavesubstantialdirecteffectsontribal W  governments,ontherelationshipbetweentheFederal @  governmentandIndiantribes,oronthedistributionof  powerandresponsibilitiesbetweentheFederalgovernment O andIndiantribes,asspecifiedinExecutiveOrder13175. 8 Today'sactiondoesnotsignificantlyoruniquelyaffectthe  communitiesofIndiantribalgovernments.TheEPAstatedin G thefinalNOxSIPCallRule,theTechnicalAmendmentsRule, 0 andtheSection126RulethatExecutiveOrder13084didnot  applybecausethosefinalrulesdonotsignificantlyor ?  uniquelyaffectthecommunitiesofIndiantribalgovernments  (" orcallonStatestoregulateNOxsourceslocatedontribal "$ lands.Thesameistrueoftodaysaction.Thus,Executive 7$x& Order13175doesnotapplytothisrule.   % !( &   ` InthespiritofExecutiveOrder13175,andconsistent '"* withEPApolicytopromotecommunicationsbetweenEPAand O)$, tribalgovernments,EPAspecificallysolicitsadditional *8&. commentonthisproposedrulefromtribalofficials.''TM ,'0   `  F.ExecutiveOrder13211:ActionsConcerningRegulations  ThatSignificantlyAffectEnergySupply,Distribution,or  Use  ? :X;XXX; ` Thissummaryoftheenergyimpactanalysisreport  @ estimatestheenergyimpactsassociatedwiththePhaseII   portionoftheNOxSIPCall,inaccordancewithExecutive O   Order13211.ItcoversallEGUsthatdonotparticipatein 8  theAcidRainTradingProgramandreciprocatinginternal   combustionengines(RICE)intheDistrictofColumbiaand G  the21StatesoftheNOxSIPCallregion,aswellasallNOx 0 SIPCallsources(cementkilns,utilityboilers,industrial  boilers,combustionturbines,andRICE)inthefinegrid ? portionsofGeorgiaandMissouri.Inaddition,this ( analysisdoesnotconsiderimpactsonsourcesinthecoarse  gridportionsofMichiganandAlabamasincethesesources 7x arenotcoveredinthePhaseIIrulemaking.TheAgency   identifiedapplicationsofcontroldevicesappropriatefor   thisanalysisthatprovidehighlevelsofNOxreductionat /!p" relativelylowcost,withanaveragecostoflessthan "$ $2,000(1990dollars)perozoneseasontonofNOxremoved, $& amongthem:SCRandNSCR,fluidinjection(steamorammonia '&h!( Єtermed_SNCR),_ԀandLEC.Throughitsanalysis,theAgency '#* identifiedthreerelevantenergyeffectsthatoccurduring w)$, normaloperationofthesedevices:increasedenergydemands +`&. requiredbycontroldevicesandequipment,increasedenergy ,(0 useduetopressuredropandchangesinthe_stoichiometry_Ԁof  thecombustionprocess,andenergycreditsfromimproved g combustion.EachoftheseNOxcontrolshasatleastoneof P theseenergyeffectsaspartoftheirnormaloperation.    ` TheUnitedStatesconsumedover22quads(quadrillion _  _Btus_)ofnaturalgasin1999.q XXX:X;X;XXX  27      ׀Withrespecttoenergy  H  sources,theapplicationofLECtechnologytonaturalgas   driveninternalcombustion(IC)enginesamountstoasavings W  ofabout4,000millionBritishthermalunits(_MMBtus_)per @  unit,orabout70billion_Btus_ԀforallaffectedICengines  (about70millioncubicfeetofgas).Thisamountstoabout O threetenthsofonepercentofthenationsannual 8 consumption.Consequently,theapplicationofLEC  technologyleadstoasmallsavingsinnaturalgasuse G nationwidebyaffectedsourcesandtheirfirms,butnota 0 largeenoughsavingstoaffectthepriceordistributionof  gasintheUnitedStates. ?   ` Theadditionalcoalnecessarytocompensateforthe  (" lossofefficiencyfromSCRandSNCRcontrolsamountsto "$ about11_MMBtus_Ԁperaffectedcoalfiredboiler,or89_MMBtus_ 7$x& peryearpersource.Forallaffectedutilityand % !( industrialcoalfiredboilers,thistranslatestoslightly '"* morethan70billion_Btus_.TheUnitedStatesalsoconsumed /)p$, over22quadsofcoalin1999.Therefore,thenetincrease  incoalconsumptionnecessaryforaffectedboilersto g compensatefortheirefficiencylossamountstoaboutthree P tenthousandthsofonepercentofthenationsannualdemand   forcoal.ThechangeindemandforcoalcausedbyNOx _  controlefficiencylosswillnotbeofsufficientmagnitude  H  toaffectcoalprices.Inaddition,thereductionin   electricityoutputinresponsetotherequirementsofthe W  PhaseIINOxSIPallrulemakingislessthanonehalfofone @  percentofpredictednationwideoutputbetween2005and2010  (toapproximatea2007projection).Becauseutilities O constantlyadjusttheiroutputtomatchdemand,andbecause 8 demandfluctuatesmorewidelythanthepredictedreduction  inelectricityoutputfromthePhaseIIrulemaking,this G reportindicatestherewillbenosignificanteffecton 0 productionorthefactorsofproductionimposedbytheNOx  SIPCallforaffectedboilers. ?   ` Therefore,weconcludethattheproposedrulewhen  (" implementedisnotlikelytohaveasignificantadverse "$ effectonthesupply,distribution,oruseofenergy.For 7$x& moreinformationontheresultsofthisanalysis,please % !( consulttheenergyimpactanalysisreportinthepublic '"* docketforthisrule.#X;XXX;O#:X;XXX;     p    /)p$, #X;XX:X;e# (80! ! "3"  3f2  G  .3  0 `   UnfundedMandatesReformAct 3fg݌*&.` (#` (# Ќ   ` TitleIIoftheUnfundedMandatesReformActof1995 ,'0 (UMRA),PublicLaw1044,establishesrequirementsfor  Federalagenciestoassesstheeffectsoftheirregulatory g actionsonState,local,andtribalgovernmentsandthe P privatesector.Undersection202oftheUMRA,2U.S.C.   1532,EPAgenerallymustprepareawrittenstatement, _  includingacostbenefitanalysis,foranyproposedorfinal  H  ruleswith Federalmandatesthatmayresultinthe   expenditurebyState,local,andtribalgovernments,inthe W  aggregate,orbytheprivatesector,of$100millionormore @  inany1year.A Federalmandateisdefinedtoincludea   Federalintergovernmentalmandateanda Federalprivate O sectormandate[2U.S.C.658(6)].A Federal 8 intergovernmentalmandate,inturn,isdefinedtoincludea  regulationthat wouldimposeanenforceabledutyupon G State,local,ortribalgovernments,[2U.S.C. 0 658(5)(A)(i)],exceptfor,amongotherthings,adutythat  is aconditionofFederalassistance[2U.S.C. ?  658(5)(A)(I)].A Federalprivatesectormandateincludes  (" aregulationthat wouldimposeanenforceabledutyuponthe "$ privatesector,withcertainexceptions[2U.S.C. 7$x& 658(7)(A)].   % !(  ` TheEPApreparedastatementforthefinalNOxSIPCall '"* thatwouldberequiredbyUMRAifitsstatutoryprovisions /)p$, applied.Todaysactiondoesnotcreateanyadditional *&. requirementsbeyondthoseofthefinalNOxSIPCall, ,'0 thereforenofurtherUMRAanalysisisneeded.   ` AnUnfundedMandatesAnalysiswaspreparedforthe g proposedSection126RulewhichwaspublishedonMay25, P 1999.TheEPAupdatedthisanalysisforthefinalSection   126Rule(January18,2000).This GovernmentEntity _  AnalysisfortheFinalSection126PetitionsUndertheClean  H  AirActAmendmentsTitleI,isavailableforpublic   inspectioninDocketA9743whichislistedinthe W  ADDRESSESsectionofthispreamble.Thisanalysis @  determinedthatthefinal126rulemakingcontainedno  regulatoryrequirementsthatmightsignificantlyoruniquely O affectsmallgovernments.Todaysactionimposesnonew 8 additionalrequirementsabovethoseestablishedinthefinal  Section126Rule. G  H.RegulatoryFlexibilityAct(RFA),asAmendedbythe 0 SmallBusinessRegulatoryEnforcementFairnessActof1996  (SBREFA),5USC601et.seq.  o   ` TheRFAgenerallyrequiresanagencytopreparea /!p" regulatoryflexibilityanalysisforanyrulesubjectto "$ noticeandcommentrulemakingrequirementsunderthe $& AdministrativeProcedureActoranyotherstatuteunlessthe '&h!( agencycertifiesthattherulewillnothaveasignificant '#* economicimpactonasubstantialnumberofsmallentities. w)$, Smallentitiesincludesmallbusinesses,small +`&. organizations,andsmallgovernmentaljurisdictions. ,(0  ` Forpurposesofassessingtheimpactsoftoday'srule  onsmallentities,smallentityisdefinedas:(1)asmall g businessasdefinedintheSmallBusinessAdministrations P (SBA)regulationsat13CFR12.201 ;(2)asmallgovernmental   jurisdictionthatisagovernmentofacity,county,town, _  schooldistrictorspecialdistrictwithapopulationof  H  lessthan50,000;and(3)asmallorganizationthatisany   notforprofitenterprisewhichisindependentlyownedand W  operatedandisnotdominantinitsfield. @   ` Afterconsideringtheeconomicimpactsoftodays  proposedaction onsmallentities,Icertifythatthis O actionwillnothaveasignificanteconomicimpactona 8 substantialnumberofsmallentities. & P Thisproposedaction    willnotimposeanyrequirementsonsmallentities.  'PzThis G actionrespondstothecourtdecisionsinMichiganv.EPA, 0 213F.3d663,AppalachianPowerv.EPA,249F.3d1032(D.C.  Cir.2001),andAppalachianPowerv.EPA,251F.3d1026 ?  (D.C.Cir.2001)(decisionsontheNOxSIPCall,Section126  (" Rule,andNOxSIPCallTechnicalAmendments,respectively). "$ TheRIAfortheoriginalfinalNOxSIPCallincludedimpacts 7$x& tosmallentitiespresumingtheapplicationofthecontrol % !( strategieswemodeledassurrogatesforwhattheStates '"* wouldactuallyemployintheirNOxSIPs.Wealsoprepared /)p$, ananalysisofimpactstosmallentitiesaffectedbythe *&. Section126Rule.ThisanalysisissummarizedintheRIA ,'0 forthefinalSection126Ruleandincludedinthedocket  forthatrule.Thisactiondoesnotimposeanyrequirements g onsmallentitiesnorwilltherebeimpactsonsmall P entitiesbeyondthose,ifany,requiredbyorresultingfrom   theNOxSIPCallandtheSection126Rules. _   I.PaperworkReductionAct   H   ` Todaysactiondoesnotaddanyinformationcollection   requirementsorincreaseburdenundertheprovisionsofthe o  PaperworkReductionAct(44U.S.C.3501etseq.),and X  thereforeisnotsubjecttotheserequirements. x    ! ! (J8 8"3 "  32J  J  .3  0 `   NationalTechnologyTransferandAdvancementAct 3݌g` (#` (# Ќ   ` Inaddition,theNationalTechnologyTransferand 'h AdvancementActof1997doesnotapplybecausetodays  proposedactiondoesnotrequirethepublictoperform w activitiesconducivetotheuseofvoluntaryconsensus ` standardsunderthatActintheNOxSIPCall,andNOxSIP  CallTechnicalAmendments.Todaysproposedactionalso o  doesnotimposeadditionalrequirementsoverthoseinthe !X" finalSection126Rule.TheEPAscompliancewiththese "$ statutesandExecutiveOrdersfortheunderlyingrules,the g$& finalNOxSIPCall(63FR57477,October27,1998),theNOx &P!( SIPCallTechnicalAmendments(64FR26298,May14,1999;65 '"* FR11222,March2,2000),andthefinalSection126Rule(65 _)$, FR2674,January18,2000)isdiscussedinmoredetailin +H&. thecitationsshownabove. ,'0 ЇListofSubjects K  ` TheEPAisnotproposingrulelanguageintodays   notice.Inthefinalrulemakingnoticeinthisproceeding,  P EPAwilladoptrulelanguageimplementingthefinalnotice. C  40CFRPart51@- p     Administrativepracticeandprocedure,Airpollution H  control,Environmentalprotection,Intergovernmental ;  relations,Ozone,Reportingandrecordkeepingrequirements.   40CFRPart52 @  Airpollutioncontrol,Ozone,Reportingandrecordkeeping 3 requirements.  40CFRPart96 8 Administrativepracticeandprocedure,Airpollution + control,Nitrogenoxides,Ozone,Reportingandrecord  keepingrequirements. {0 40CFRPart97 #! Administrativepracticeandprocedure,Airpollution "  control,IntergovernmentalRelations,Nitrogenoxides, s$(" Ozone,Reportingandrecordkeepingrequirements. &$ Dated:  ,p$, Ї______________________________ H ChristineT.Whitman,    Administratorx | " `