ÿWPC¸ ÆvqKÕݴߤ%y¶0ßÏ}ÂV‘hý¨¾å×ëá'žßÒªy¯›â×Jz®9jíe´Pß¿‹^AFØMê²¼q—*18Í{Á}(ºH{ºTòìý­çÏÏ%‘c‰mÂNñL‹Õ¤3ÜÝ|ñ¤7Qÿ¿÷àe@×ÁÈݰ³-³iH?ÛÐc@´·/õÓO;¥§ }¿‘%Çæòÿ~HRg»¸w‘Ñ©) ¾€pgìó-B«h öÙç±¢ág&jÂÌ 0D  0NNVœMòU.öë$U>UNMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMM A› 0D888 D+| 0K§Æò˜HP LaserJet 6P,ü,,,,,ü0(ÈhH  Z6Times New Roman RegularX($¡¡P’Ý(c ™™ g V D v gEÊTn(ng É„3|xÿU‹ÿÀÀÀ3#37=CIQYag­­1.a.i.(1)(a)(i)1)a)(;3£$´´Ô2#ÔÚ  Ú0Ú  Ú.Ô3  Ôà0  à(Oé;$µµà0  àÔ2#ÔÚ  ÚaÚ  Ú.Ô3  Ôà0` (#(#à(b·¤$¶¶à0  àà0` (#(#àÔ2#ÔÚ  ÚÚ  Ú.Ô3  Ôà0¸ ` (#` (#à(xir$··à0  àà0` (#(#àà0¸ ` (#` (#àÔ2#Ô(Ú  Ú0Ú  Ú)Ô3  Ôà0¸ (#¸ (#à(ŒÜ$¸¸à0  àà0` (#(#àà0¸ ` (#` (#àà0¸ (#¸ (#àÔ2#Ô(Ú  ÚaÚ  Ú)Ô3  Ôà0h(#(#à(ŸF$¹¹à0  àà0` (#(#àà0¸ ` (#` (#àà0¸ (#¸ (#àà0h(#(#àÔ2#Ô(Ú  ÚÚ  Ú)Ô3  Ôà0Àh(#h(#à(³Àô$ººà0  àà0` (#(#àà0¸ ` (#` (#àà0¸ (#¸ (#àà0h(#(#àà0Àh(#h(#àÔ2#ÔÚ  Ú0Ú  Ú)Ô3  Ôà0À(#À(#à(ǵ{$»»à0  àà0` (#(#àà0¸ ` (#` (#àà0¸ (#¸ (#àà0h(#(#àà0Àh(#h(#àà0À(#À(#àÔ2#ÔÚ  ÚaÚ  Ú)Ô3  Ôà0p(#(#à xAGaeimquy}Bullet ListBullets List Harnett SUVsi •Ý ƒ/Q+ÝÔ d ÔÝ  ÝÔ_ÔÔ€â.ÙãXXÔÌÌÌà  àԇܸÜãâ.ÙÔDÐ ’ â ÐÌÌà  àà ` àà ¸ àRÌÌà  àà ` àà ¸ àà  àà h àÌà  àà ` àà ¸ àà  àà h àAÌÌÌà  àà ` àà ¸ àà  àà h àà À àà  àFÌÌÌà  àà ` àà ¸ àà  àà h àà À àà  àà p àà È àTÌà  àà ` àà ¸ àà  àà h àà À àà  àà p àà È àÔ#†â.ÙãÜܸe#Ô((3/Q$««Ý ƒ!ÝÝ  ÝÔ d Ô Ý ƒ¯'ÝÝ  ÝÔ_ÔÓ  ÓÔ_Ôò òÔ‡XÕ„XXXÔDRAFT€DOCUMENT€FOR€PUBLIC€REVIEWÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÔ_ÔÐ ° ÐDOES€NOT€REPRESENT€OFFICIAL€AGENCY€POLICYÔ#†XŽšXXXÕ„J#Ôó óÔ_Ô<è\( 9Z+&Courier Regular(3¯$§§Ý ƒ!ÝÝ  Ý(ÍO$——ÔÿÔòòóóÔÿÔhttp://www.epa.gov/oms/transp/traqconf.htm<è\( 9Z+Courier áÝ ƒ¯'ÝÝ  ÝÔ_ÔÓ  Óò òÔ‡!XÕ„XXXÔCONFIDENTIAL:€DRAFT€FOR€DELIBERATIVE€PURPOSES€ONLYÐ ° ÐNOT€FOR€PUBLIC€DISTRIBUTIONÔ#†"XŽšXXXÕ„:#Ôó ó<è\( 9Z+&Courier Regular(ÈhH  Z6Times New Roman Regular\W[Z I&mage <=8ÿÿÿÿÿÿÿÿÿÿCÿÿ HKKKK(3¯$££Ý ƒ!ÝÝ  Ý'ÈÈÈÈdxd( ±þ$’’ò òFigure€Ú  Ú1Ú  Úó óLevel 1Level 2Level 3Level 4Level 5Ý ƒ!ÝÝ  ÝÔ_ÔññÒe°ÒññÔ‡XÕ„XXXÔò òñ ñÑ8€ŽšXXdðdÈ8Ññ ñÖ€ÿÿÖÔ_ÔññÑ  ÑññÔ_ÔññÔ_ÔÖ€ÿÿÖÔ_ÔññññÖ€ ÿÿÖññÓÓÔ_ÔÔ_ÔÔ_Ôñ ññ ñÑ8€ŽšXXdðdÈ8Ññ ññ ñÔ_ÔÔ_Ôñ ñÑ8€Õ„XXdÈdÈ8Ññ ñÔ_ÔÌÔ_ÔññññÒe°ÒññññDRAFTÔ_ÔÔ_Ôññ€6„19„00ññó óÔ_ÔÐ Hð ÐÓQÓÔ_ÔòòMEMORANDUMÔ_ÔÐ 8 à ÐÌÔ_ÔóóññÒe°ÒññÔ_Ôà0 ½ àà e àSubject:à0 ½(#½(#àUse€of€Emissions€Reductions€from€Motor€VehiclesÐ È p ÐOperated€on€Low„Sulfur€Gasoline€as€New€Source€ReviewÏ(NSR)€Offsets€for€Tier€2/Gasoline€Sulfur€RefineryÏProjects€in€Nonattainment€AreasÐ  (# (# ÐÌFrom:à0  àBill€Harnett,€DirectorаX  (# (# Ðà ½ àà0  àInformation€Transfer€&€Program€Integration€DivisionÐ  (# (# ÐÌTo:à0 ½ àà0 ½(#½(#àAir€Division€Directorsòòóóа  (# (# ÐÌà ½ àIn€December€1999,€EPA€announced€a€major€program€designed€toÏsignificantly€reduce€emissions€from€all€new€passenger€vehicles.€ÏThe€new€vehicle€emissions€standards€(known€as€the€ð ðTier€2Ïstandardsðð)€for€passenger€vehicles€will€cause€them€to€be€77€to€95Ïpercent€cleaner€than€those€on€the€road€today.€€This€program€marksÏthe€first€time€that€sports€utility€vehicles€and€other€light„dutyÏtrucks€are€subject€to€the€same€national€pollution€standards€asÏcars.€€And,€for€the€first€time,€EPAððs€program€treats€vehicles€andÏfuels€together€as€a€system.€€To€ensure€the€effectiveness€of€theÏlow€emissions„control€technologies€on€these€vehicles,€EPA€also€isÏrequiring€refineries€to€lower€the€sulfur€content€in€gasoline€byÏapproximately€90€percent.€€Together,€these€new€requirements€makeÏup€the€Tier€2/Sulfur€program.€€The€requirements€and€a€fullÏexplanation€of€them€can€be€found€in€the€òòFederal€Registeróó€(volumeÐ Àh Ð65,€no.€28)€dated€February€10,€2000,€beginning€on€page€6698.€€ÌÌà ½ àIn€order€to€meet€EPAððs€gasoline€sulfur€requirements,€mostÏrefiners€are€required€to€meet€a€gasoline€sulfur€standard€of€120Ïparts€per€million€(ppm)€as€averaged€over€their€entire€corporateÏgasoline€pool,€and€a€per„gallon€cap€of€300€ppm,€beginning€inÏ2004.€€In€2005,€most€refiners€must€meet€a€corporate€pool€averageÏgasoline€sulfur€standard€of€90€ppm,€and€a€refinery€average€of€30Ïppm.€€By€2006,€most€refiners€must€meet€an€80€ppm€per„gallon€capÏand€a€30€ppm€refinery€average€sulfur€level.€òòò òó óóó€Small€refiners€andÐ $8% Ðsome€others€are€subject€to€€different€sets€of€standards€andÏcompliance€dates.Ô#†XŽšXXXÕ„C#ÔÔ‡XÕ„XXXŽšÔ€€In€order€to€meet€these€sulfur„in„gasolineÐ  &È' Ðrequirements,€many€refiners€will€have€to€make€modifications€toÏtheir€existing€facilities.Ô#†XŽšXXXÕ„ #ÔÔ‡XÕ„XXXŽšÔ€€We€believe€that€the€typicalÐ °'X ) Ðmodifications€will€involve€the€installation€of€newÏdesulfurization€process€units,€including€new€process€heaters.€€InÏaddition,€some€refineries€may€have€to€make€changes€related€toÏsulfur€recovery€units,€amine€treatment€units,€hydrogen€productionÏor€other€processes€to€address€the€removal€of€sulfur.€€Any€ofÏthese€changes€could€result€in€a€significant€increase€in€actualÐ `,%/ Ðemissions€of€one€or€more€pollutants€and€therefore€require€theÏissuance€of€major€NSR€permits„„someÔ#†XŽšXXXÕ„ë #ÔÔ‡XÕ„XXXŽšÔ€for€refineries€located€inÐ  È Ðnonattainment€areas„„before€the€necessary€changes€to€the€refineryÏmay€occur.€ÌÌà ½ àOne€of€the€prerequisites€for€a€major€NSR€permit€in€aÏnonattainment€area€is€that€a€new€or€modified€source€must€offsetÏits€proposed€eÔ#†XŽšXXXÕ„E#ÔÔ‡XÕ„XXXŽšÔmissions€increase€with€sufficient€emissionsÐ Ð x Ðreductions€from€another€source€or€sources.Ô#†XŽšXXXÕ„”#ÔÔ‡XÕ„XXXŽšÔ€€Some€States€haveÐ ˜ @ Ðexpressed€concern€that€most,€if€not€all,€of€the€emissionsÏreductions€(particularly€for€NOx)€available€from€existingÏstationary€sources€in€nonattainment€areas€will€be€needed€to€reachÏattainment.Ô#†XŽšXXXÕ„@#ÔÔ‡XÕ„XXXŽšÔ€Thus,€in€these€nonattainment€areas,€it€may€beÐ ¸`  Ðdifficult€to€find€sufficient€emissions€reductions€of€theÏappropriate€pollutant€from€existing€stationary€sources€to€satisfyÏthe€requirements€for€emissions€offset€under€the€part€DÏnonattainment€area€NSR€permitting€program.€€€To€help€giveÏcertainty€that€offsets€would€be€available€to€refineriesÏimplementing€the€gasoline€sulfur€controls,€EPA€raised€theÏpossibility€during€the€Tier€2/Sulfur€rulemaking€process€that€suchÏrefineries€could€use€some€of€the€emissions€reductions€resultingÏfrom€vehicles€operated€on€low€sulfur€gasoline€as€NSR€offsets.€ÏThis€memorandum€explains€EPAððs€final€position€that€emissionsÏreductions€resulting€from€motor€vehicles€operated€on€low€sulfurÏgasoline€are€acceptable,€under€certain€conditions,€for€satisfyingÏthe€NSR€emissions€offsets€requirement.€€For€example,€TierÏ2/Sulfur€emissions€reductions€of€NOx€may€be€used€to€offset€NOxÏemissions€increases€from€refineries€undergoing€majorÏmodifications€in€ozone€nonattainment€areas€to€comply€with€theÏTier€2/Sulfur€requirements€so€long€as€the€reductions€meet€theÏcreditability€criteria€for€NSR€offsets.€ÌÌà ½ àIn€general,€any€emissions€reduction€that€is€to€be€used€as€anÏemissions€reduction€credit€must€be€surplus,€quantifiable,Ïenforceable€and€permanent.€€Specific€criteria€for€offsets,€whichÏeither€clarify€or€add€to€the€general€creditability€criteria,€Ô#†XŽšXXXÕ„j#ÔÔ‡XÕ„XXXŽšÔareÐ °"X# Ðcontained€in€the€Clean€Air€Act€under€section€173€(in€part€D€ofÏthe€Act),€as€follows:ÌÌ1.€The€emissions€reduction€must€be€federally€enforceable.€[CAAÏsec.€173(a)]Ô#†XŽšXXXÕ„%#ÔÔ‡XÕ„XXXŽšÔÐ ˜&@( ÐÌ2.€The€emissions€reduction€must€be€in€effect€by€the€time€theÏnew/modified€source€commences€operation.€[CAA€sec.€173(a)(1)(A)]Ô#†XŽšXXXÕ„ #ÔÔ‡XÕ„XXXŽšÔÐ ð(˜!+ ÐÌ3.€The€emissions€reduction€must€ensure€that€new€emissionsÏincreases€will€not€interfere€with€attainment€of€the€nationalÏambient€air€quality€standards.€[CAA€sec.€173(c)(1)]€€Ô#†XŽšXXXÕ„õ#ÔÔ‡XÕ„XXXŽšÔÐ ,¸$/ Ї4.€€The€emissions€reduction€must€be€an€actual€emissions€reductionÏof€the€pollutant€for€which€an€increase€will€occur.€[CAA€sec.Ï173(c)(1)]ÌÌ5.€€The€emissions€reduction€generally€must€be€located€in€the€sameÏnonattainment€area€as€the€source€needing€offsets.€[CAA€sec.Ï173(c)(1)]ÌÌ6.€€The€emissions€reduction€must€be€in€sufficient€amount€toÏsatisfy€the€applicable€offset€ratio.€[CAA€sec.€173(c)(1)]Ô#†XŽšXXXÕ„ù#ÔÔ‡XÕ„XXXŽšÔÐ `  ÐÌ7.€The€emissions€reduction€must€not€be€otherwise€required€underÏthe€Act.€[CAA€sec.€173(c)(2)]ÌÔ#†XŽšXXXÕ„Û#ÔÔ‡XÕ„XXXŽšÔÌà ½ àIn€order€to€provide€the€necessary€assurance€to€States,€whoÏmay€want€to€use€some€of€the€Tier€2/Sulfur€emissions€reductions€toÏoffset€emissions€increases€from€refineries€in€nonattainmentÏareas,€EPA€is€setting€forth€in€the€attachment€to€this€memorandumÏits€explanation€of€how€States€can€use€the€Tier€2/Sulfur€emissionsÏreductions€in€a€manner€consistent€with€the€statutory€criteria€forÏcreditable€emissions€offsets.Ô#†XŽšXXXÕ„‘#ÔÔ‡XÕ„XXXŽšÔ€However,€the€use€of€any€portion€ofÐ ø  Ðthe€Tier€2/Sulfur€emissions€reductions€as€NSR€offsets€isÏcontingent€upon€a€decision€by€the€applicable€State€or€local€airÏagency€to€dedicate€the€reductions€for€that€particular€purpose.€ÏThis€guidance€does€not€guarantee€the€availability€of€any€amountÏof€Tier€2/Sulfur€emissions€reductions€specifically€for€NSRÏoffsets,€nor€is€it€intended€to€mandate€that€States€use€TierÏ2/Sulfur€emissions€reductions€as€offsets.Ô#†XŽšXXXÕ„{#ÔÔ‡XÕ„XXXŽšÔÐ p ÐòòóóÔ#†XŽšXXXÕ„Ž!#ÔÔ‡XÕ„XXXŽšÔÌà ½ àThe€guidance€contained€in€this€memorandum€and€attachmentÏsets€forth€EPAððs€legal€interpretation€on€the€creditability€ofÏTier€2/Sulfur€emissions€reductions€as€NSR€offsets.€€This€guidanceÏdoes€not€supercede€existing€Federal€or€State€regulations€orÏapproved€SIPððs.€€The€policies€set€out€in€this€guidance€do€notÏrepresent€final€Agency€action,€and€are€intended€as€guidance€only.€ÏThis€guidance€is€not€ripe€for€judicial€review.€€Moreover,€it€isÏnot€intended,€nor€can€it€be€relied€upon,€to€create€any€rightsÏenforceable€by€any€party€in€litigation€with€the€United€States.€ÏState€and€local€agency€officials€may€decide€to€follow€theÏguidance€provided€in€this€memorandum€and€attachment,€or€to€act€atÏvariance€with€the€guidance,€based€on€an€analysis€of€specificÏcircumstances.€€The€EPA€may€change€this€guidance€at€any€timeÏwithout€public€notice.€€Ìòòò òÌó óóóà ½ àFinally,€we€are€asking€EPA€Regional€Offices€to€promptly€sendÐ à)ˆ", Ðthis€memorandum€and€attachment€to€State€and€local€permittingÏagencies€within€their€jurisdiction.€€Questions€concerning€theÏapplication€of€this€guidance€to€specific€implementation€plans€andÐ 8,à$/ Ðmobile€source€emissions€inventories€should€be€directed€toward€theÏappropriate€Regional€Office.€€Regional€Office€staff€may€contactÏDan€deRoeck€of€the€Integrated€Implementation€Group€at€919/541„¼5593,€if€they€have€any€Ô_Ôquestions.Ô_ÔÌÔ_ÔÌÔ_ÔÔ_ÔÌÔ_ÔÔ_Ôñ ñÐ   ° Ðñ ñÔ_Ôñ ñØØñ ñÌÔ_ÔÔ_ÔÔ_ÔÔ_ÔÓ  ÓÔ_Ôò òñ ñÑ  Ññ ñÔ_ÔÔ_Ôñ ñÜÜÜÜÜÜñ ñATTACHMENTó óÔ_ÔÐ  È ÐÓ{(ÓÌÓ  Óò òDescription€of€EPAððs€Position€Concerning€the€Use€of€Tier€2/SulfurÐ Ø € ÐEmissions€Reductions€in€a€Manner€Consistent€With€the€ÌClean€Air€Act€Requirements€for€New€Source€Review€Offsetsó óÐ ¸ ` ÐÓH)ÓÌ1.a.€€òòHow€can€States€use€the€Tier€2/Sulfur€emissions€reductionsÐ p  Ðas€offsets€without€interfering€with€the€attainment€of€theÏnational€ambient€air€quality€standards?óóò òÐ ¨  ÐÌó óThe€purpose€of€an€emissions€offset€is€to€ensure€that€the€increaseÐ ¸`  Ðin€emissions€in€a€nonattainment€area€resulting€from€a€new€orÏmodified€major€stationary€source€does€not€interfere€with€eitherÏ(a)€the€progress€being€provided€by€the€annual€reductionsÏidentified€by€the€State€to€reach€attainment,€or€(b)€attainment€byÏthe€attainment€date.€€Ô#†XŽšXXXÕ„ë!#ÔÔ‡XÕ„XXXŽšÔTherefore,€it€makes€sense€that€emissionsÐ  H  Ðreductions€used€to€offset€a€proposed€emissions€increase€cannotÏalso€be€òòóócredited€toward€either€RFP€or€the€attainmentÐ 0Ø Ðdemonstration.€€This€would€constitute€double€counting,€i.e.,Ïtreating€the€amount€of€motor€vehicle€emissions€as€not€being€inÏthe€air€for€attainment€planning€purposes€while€at€the€same€timeÏallowing€the€emissions€to€be€in€the€air€through€construction€ofÏthe€modified€refinery€using€that€amount€of€emissions€as€an€NSRÏoffset.€€Such€double€counting€is€prohibited€under€the€Clean€AirÏAct.€€See€e.g.,€40€CFR€ðð€51.156(a)(3)(G).ÌÌStates€have€flexibility€in€deciding€how€to€distribute€the€TierÏ2/Sulfur€emissions€reductions€of€NOx€that€will€occur€in€aÏparticular€nonattainment€area.€€For€example,€a€State€that€decidesÏto€use€all€of€the€Tier€2/Sulfur€emissions€reductions€of€NOx€toÏdemonstrate€RFP€or€attainment€will€have€to€find€additional€NOxÏemissions€reductions€elsewhere€for€offsets€or€require€that€theÏproposed€source€or€modification€identify€the€required€NOx€offsetsÏon€their€own.€€Alternatively,€States€choosing€to€use€a€portion€ofÏtheir€Tier€2/Sulfur€emissions€reductions€as€offsets€must€avoidÏdouble€counting€those€reductions€by€explicitly€identifying€theÏamount€of€NOx€emissions€reductions€that€it€will€set€aside€asÏoffsets.ÌÌb.€€òòHow€should€Tier€2/Sulfur€emissions€reductions€and€their€useÐ `' ( Ðas€offsets€be€reflected€in€the€SIPððs€motor€vehicle€emissionsÏbudgets?óó€Ð ð(˜!* ÐÌSIPs€that€are€currently€being€developed€and€submitted€mustÏinclude€the€effects€of€the€Tier€2/Sulfur€rule€when€estimating€theÌfuture€on„road€mobile€inventory.€This€on„road€mobile€inventoryÐ ,¸$. Ðwill€generally€become€the€motor€vehicle€emissions€budgets€forÏconformity€purposes.€€One€potential€exception€is€the€case€whereÏnot€all€of€the€Tier€2/Sulfur€emissions€reductions€are€necessaryÏfor€attainment€or€reasonable€further€progress,€and€the€StateÏchooses€to€increase€the€motor€vehicle€emissions€budgets€in€orderÏto€allow€growth€in€mobile€sources€above€what€the€SIP€currentlyÏexpects.€€In€this€case,€the€amount€by€which€the€budgets€areÏincreased€would€not€be€available€for€use€as€offsets.€€In€order€toÏprevent€double€counting,€States€that€want€to€provide€for€offsetsÏwould€need€to€identify€the€amount€of€emissions€reduction€beingÏset€aside€for€offsets€and€confirm€that€the€emissions€reductionsÏhave€not€been€assigned€to€increase€the€motor€vehicle€emissionsÏbudgets.ÌÌSome€SIPs€that€were€submitted€before€the€final€Tier€2/Sulfur€ruleÏdo€not€reflect€the€effects€of€the€rule€in€the€motor€vehicleÌemissions€budgets.€€In€these€cases,€if€the€State€is€relying€onÏall€or€a€portion€of€the€Tier€2/Sulfur€emissions€reductions€inÏorder€to€demonstrate€attainment€or€reasonable€further€progress,Ïthe€motor€vehicle€emissions€budgets€must€be€lowered€by€thatÌamount.€€Similarly,€if€the€State€wants€to€set€aside€a€portion€ofÏthe€Tier€2/Sulfur€emissions€reductions€for€offsets,€the€motorÌvehicle€emissions€budgets€must€be€lowered€by€that€amount€in€orderÏto€prevent€double€counting.€€If€the€State€does€not€lowerÌthe€motor€vehicle€emissions€budgets€in€the€SIP€to€reflect€theÏTier€2/Sulfur€emissions€reductions,€those€reductions€are€beingÏused€for€conformity€purposes€and€are€not€available€for€use€asÏoffsets.Ô#†XŽšXXXÕ„¥,#ÔÔ‡XÕ„XXXŽšÔÐ p ÐÌ2.€€òòHow€can€States€assure€that€offsets€derived€from€the€TierÐ ¨ Ð2/Sulfur€emissions€reductions€are€federally€enforceable?óóÐ Èp ÐÌò òó óAs€described€above,€each€State€must€account€for€the€amount€ofÐ X   ÐTier€2/Sulfur€emissions€reductions€which€it€intends€to€set€asideÏfor€NSR€offsets€in€the€applicable€implementation€plan.€€TheÏquantification€of€the€amount€and€commitment€in€the€plan€to€use€aÏspecified€portion€of€the€Tier€2/Sulfur€emissions€reductions€asÏoffsets€Ô_ÔÔ#†XŽšXXXÕ„Û9#ÔÔ‡XÕ„XXXŽšÔ(therebyÔ_Ô€removing€them€from€the€SIPððs€motor€vehicleÐ @$è% Ðemissions€budgets)€are€necessary€steps€so€that€Ô#†XŽšXXXÕ„E<#ÔÔ‡XÕ„XXXŽšÔthe€reductions€Ô_ÔÔ#†XŽšXXXÕ„=#ÔÔ‡XÕ„XXXŽšÔcanÔ#†XŽšXXXÕ„r=#ÔÔ‡XÕ„XXXŽšÔÔ_ÔÐ %°& Ðbe€considered€federally€enforceable€Ô_ÔÔ#†XŽšXXXÕ„·=#ÔÔ‡XÕ„XXXŽšÔforÔ_Ô€offset€purposes.Ô#†XŽšXXXÕ„R>#ÔÔ‡XÕ„XXXŽšÔ€€Ô_ÔÔ#†XŽšXXXÕ„¸>#ÔÔ‡XÕ„XXXŽšÔInÔ_ÔÐ Ð%x' Ðaddition,€when€a€State€is€using€the€bulk€of€the€Tier€2/SulfurÏemissions€reductions€as€offsets€it€should€include€contingencyÏmeasures€Ô#†XŽšXXXÕ„ ?#ÔÔ‡XÕ„XXXŽšÔproviding€for€the€acquisition€of€alternative€offsets€inÐ ((Ð * Ðthe€event€that€the€actual€emissions€reductions€from€theÏimplementation€of€the€Tier€2/Sulfur€program€in€a€givenÏnonattainment€area€fail€to€meet€the€amounts€projected€for€theÏarea.Ô#†XŽšXXXÕ„ú?#Ôò òÔ‡XÕ„XXXŽšÔ€ó óÔ#†XŽšXXXÕ„=A#ÔÔ‡XÕ„XXXŽšÔ€EPA€will€work€with€any€State€that€requests€assistance€inÐ H+ð#. Ðquantifying€the€Tier€2/Sulfur€emissions€reductions€as€wellÐ ,¸$/ ÐdevelopingÔ#†XŽšXXXÕ„ƒA#ÔÔ‡XÕ„XXXŽšÔ€Ô_ÔappropriateÔ#†XŽšXXXÕ„lB#ÔÔ‡XÕ„XXXŽšÔÔ_Ô€contingency€measures€Ô_ÔÔ#†XŽšXXXÕ„ÊB#ÔÔ‡XÕ„XXXŽšÔasÔ_Ô€may€be€neededÔ#†XŽšXXXÕ„BC#ÔÔ‡XÕ„XXXŽšÔ.Ô#†XŽšXXXÕ„¤C#ÔÔ‡XÕ„XXXŽšÔÐ X ÐÌ3.€€òòCan€Tier€2/Sulfur€emissions€reductions€be€considered€ð ðinÐ è Ðeffectðð€by€the€time€the€new/modified€source€commences€operation?óóÐ ° X ÐÌEPA€believes€that€the€Tier€2/Sulfur€emissions€reductions€can€beÏconsidered€in€effect€relative€to€the€operation€date€of€theÏrefinery,€even€though€in€some€instances€the€initial€reductionsÏwill€not€occur€(at€least€with€respect€to€the€first€refineryÏundergoing€modification)€until€shortly€after€the€refineryððsÏmodifications€are€complete€and€it€has€begun€producing€the€lowÏsulfur€gasoline.€€Generally,€however,€the€gasoline€produced€by€aÏrefinery€reaches€the€market€within€a€few€weeks€of€production,€andÏvirtually€all€refineries€sell€some€portion€of€their€gasoline€toÏthe€local€market.€€Because€of€these€factors,€and€since€theÏoverall€amount€of€emissions€reductions€from€Tier€2€will€be€veryÏlarge€in€relation€to€the€relatively€small€NOx€emissions€increasesÏexpected€from€refineries,€EPA€anticipates€that€the€amount€ofÏemissions€reductions€needed€for€offset€purposes€will€be€generatedÏwithin€a€few€weeks€after€the€modified€refineries€begin€operating.Ô#†XŽšXXXÕ„çC#ÔÔ‡XÕ„XXXŽšÔÐ 0Ø ÐStates€would€need€to€confirm€this€information€with€any€refineryÏseeking€to€use€such€offsets.Ô#†XŽšXXXÕ„¥H#ÔÔ‡XÕ„XXXŽšÔ€€Thus,€the€benefits€derived€from€theÐ Àh Ðuse€of€low€sulfur€gasoline€will€begin€to€be€experienced€within€aÏmatter€of€weeks€from€the€date€of€production.€€This,€in€EPAððsÏview,€is€an€insignificant€difference€which€should€not€invalidateÏthe€use€of€the€reductions€as€offsets€for€the€affected€refinery.€ÌÌÔ#†XŽšXXXÕ„XI#ÔÔ‡XÕ„XXXŽšÔ4.€€òòWill€the€Tier€2/Sulfur€emissions€reductions€represent€actualÐ p ÐNOx€emissions€reductions?óóÐ 8à ÐÌEPA€believes€that€the€implementation€of€the€Tier€2/Sulfur€programÏwill€result€in€emissions€reductions€that€are€both€real€(actual)Ïand€quantifiable.€€Quantification€of€the€annual€Tier€2/SulfurÏemissions€reductions€(including€the€ozone€season€and€non„ozoneÏseason)€in€any€county€or€combination€of€nonattainment€countiesÏcan€be€achieved€by€determining€the€old€(baseline)€gasoline€sulfurÏlevel€and€the€fraction€that€will€be€changed€by€the€new€low„sulfurÏgasoline€from€the€proposed€refinery€changes,€as€well€as€theÏmakeup€of€the€vehicle€fleet€(model€year€and€vehicle€type),€numberÏof€miles€driven€by€the€local€vehicle€fleet,€and€the€effect€ofÏgasoline€sulfur€levels€on€the€emissions€factor€for€each€modelÏyear„vehicle€type€combination€in€the€affected€area.€€ÌÌEPA€will€soon€have€available€estimates€of€county„by„county€TierÏ2/Sulfur€emissions€reductions€for€NOx€occurring€in€the€year€2004Ïand€beyond.€€Those€estimates€consider€both€the€phasing€in€of€lowÏsulfur€gasoline€and€the€introduction€of€motor€vehicles€whichÏcomply€with€the€Tier€2/Sulfur€standards.€€For€emissionsÐ ,¸$/ Ðreductions€occurring€before€2004,€State€should€calculate€theÏemissions€reductions€attributable€to€the€use€of€low€sulfurÏgasoline€in€the€existing€motor€vehicle€fleet,€which€would€notÏinclude€vehicles€meeting€the€Tier€2€vehicle€emissions€standards.€ÏInformation€on€the€pre„2004€vehicle€mix€and€gasoline€sulfurÏlevels€should€be€determined€by€State€and€local€officials€inÏcooperation€with€the€affected€refiners.€€EPA€will€respond€toÏrequests€for€assistance€by€working€with€the€States€to€make€theÏnecessary€calculations€of€motor€vehicle€emissions€reductions.€€ÌÌTier€2/Sulfur€emissions€reductions€can€be€calculated€on€a€county„¼by„county€basis€for€any€nonattainment€area.€€Therefore,€StatesÏmay€set€aside€reductions€from€any€county€or€counties€within€theÏsame€nonattainment€area€or€from€counties€in€other€nearbyÏnonattainment€areas€which€meet€the€statutory€conditions€for€theÏlocation€of€offsets€[CAA€at€sec.€173(c)(1).]€€In€addition,€StatesÏmust€take€into€account€the€offset€ratio€applicable€to€theÏaffected€nonattainment€area€in€order€to€accurately€determine€theÏamount€of€offset€needed.€ÌÔ#†XŽšXXXÕ„ØJ#ÔÔ‡XÕ„XXXŽšÔÌ5.€€òòAre€the€Tier€2/Sulfur€emissions€reductions€otherwise€requiredÐ ø  Ðby€the€Act?óóÐ Àh ÐÌNo,€both€the€Tier€2€vehicle€emissions€standards€and€sulfur„in„¼gasoline€limits€are€considered€to€be€based€on€findings€thatÏinvolved€the€Administratorððs€discretion.€€Thus,€since€the€statuteÏdid€not€mandate€that€EPA€promulgate€Tier€2/sulfur€controlÏregulations,€emissions€reductions€resulting€from€either€theÏvehicle€emissions€standards€or€the€gasoline€sulfur€limits€areÏconsidered€to€be€ð ðnot€otherwise€requiredðð€within€the€meaning€ofÏsection€173(c)(2)€of€the€Act,€in€contrast€to,€e.g.,€reasonablyÏavailable€control€technology€(RACT)€requirements€under€Part€D€ofÏTitle€I,€which€are€mandatory€and€thus€ð ðotherwise€required.ððÔ#†XŽšXXXÕ„ T#ÔÔ‡XÕ„XXXŽšÔ€EPAÐ X   Ðadopted€the€Tier€2€motor€vehicle€emissions€standards€under€theÏauthority€of€section€202(i)€of€the€Act,€which€authorizes€EPA€toÏstudy€whether€further€emissions€reductions€beyond€the€reductionsÏalready€required€by€the€Act€from€light„duty€vehicles€and€light„¼duty€trucks€should€be€required.€€While€the€study€itself€wasÏrequired€by€the€Act,€EPA€exercised€considerable€discretion€inÏarriving€at€the€conclusions€which€lead€the€Agency€to€establishÏthe€Tier€2€motor€vehicle€emissions€standards.€€Also,€EPA€adoptedÏthe€sulfur€controls€pursuant€to€its€discretionary€authority€underÏSection€211(c)(1)€of€the€Act€to€adopt€controls€or€prohibitions€onÏthe€manufacture,€introduction€into€commerce,€offering€for€sale,Ïor€sale€of€a€fuel€or€fuel€additive€if,€in€the€Administrator'sÏjudgment,€(1)€any€emissions€product€of€the€fuel€or€additiveÏcauses€or€contributes€to€air€pollution€which€may€reasonably€beÏanticipated€to€endanger€public€health€or€welfare,€or€(2)Ð ,¸$/ Ðemissions€products€of€the€fuel€or€additive€will€impair€to€aÏsignificant€degree€the€performance€of€an€emissions€control€deviceÏor€system€which€is€in€general€use,€or€which€the€AdministratorÏfinds€would€be€in€general€use€in€a€reasonable€time€if€the€fuelÏcontrol€is€adopted.€€EPA€exercised€its€discretion€to€adoptÏgasoline€sulfur€controls€based€on€both€of€these€findings€underÏSection€211(c)(1)€of€the€Act.ÌÌÔ#†XŽšXXXÕ„[W#Ô