Hazardous Air Pollutants: Regulations Governing Equivalent Emission Limitations by Permit

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 9 and 63

[FRL-4881-9]

RIN 2060-AE00

Hazardous Air Pollutants: Regulations Governing Equivalent

Emission Limitations by Permit

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The EPA is promulgating regulations governing the

establishment of equivalent emission limitations by permit, pursuant to

section 112(j) of the Clean Air Act (Act), as amended. This rule

establishes requirements and procedures for owners or operators of

major sources of hazardous air pollutant(s) (HAP), and permitting

authorities, to follow in order to comply with section 112(j). After

the effective date of a title V permit program in a State, each owner

or operator of a major source in a source category for which the EPA

was scheduled to, but failed to promulgate a maximum achievable control

technology (MACT) standard will be required to submit a permit

application 18 months after the EPA's missed promulgation date. This

rule establishes requirements for the contents of these applications.

In addition, the rule contains provisions governing the establishment

of MACT-equivalent emission limitations by the permitting authority.

EFFECTIVE DATE: The rule and guidance announced herein take effect on

June 20, 1994.

ADDRESSES: Docket. Supporting information used in developing the

proposed and final rules contained in Docket Number A-93-32. The docket

is available for public inspection and copying from 8:30 a.m.-12 p.m.

and 1:30 p.m.-3:30 p.m., Monday through Friday, at the EPA's Air Docket

Section, Waterside Mall, room M1500, U.S. Environmental Protection

Agency, 401 M Street, SW., Washington, DC 20460. A reasonable fee may

be charged for copying.

FOR FURTHER INFORMATION CONTACT: For information on today's final rule,

please contact Ms. Katherine Kaufman, Emission Standards Division (MD-

13), U.S. Environmental Protection Agency, Research Triangle Park,

North Carolina, 27711, telephone (919) 541-0102. For information about

the guidance document ``MACT Determinations under Section 112(j)'' (EPA

450/3-92-007a), please contact Ms. Lynn Hutchinson, Emission Standards

Division (MD-13), U.S. Environmental Protection Agency, Research

Triangle Park, North Carolina, 27711, telephone (919) 541-5624.

SUPPLEMENTARY INFORMATION: The information presented in this preamble

is organized as follows:

I. Summary of Final Rule

II. Background Discussion

A. Clean Air Act Amendments: Section 112

B. Clean Air Act Amendments: Provisions for Equivalent Emission

Limitation by Permit.

C. Implementation Principles

III. Significant Comments and Changes to the Proposed Rule

A. Sec. 6.50--Applicability

B. Sec. 6.51--Definitions

C. Sec. 6.52--Approval Process for New and Existing Emission

Units

D. Sec. 6.53--Application Content for a Case-by-Case MACT

Determination

E. Sec. 6.54--Preconstruction Procedures for New Emission Units

F. Sec. 6.55--Maximum Achievable Control Technology (MACT)

Determinations for Emission Units Subject to Case-by-Case

Determination of Equivalent Emission Limitations

G. Sec. 6.56--Requirements for Case-by-Case Determination of

Equivalent Emission Limitations After Promulgation of a Subsequent

MACT Standard

IV. Discussion of the Relationship of the Proposed Requirements to

Other Requirements of the Act

A. Section 112(g) Requirements for Constructed, Reconstructed,

and Modified Major Sources; and Subsequent Standards under Section

112(d) or Section 112(h).

B. Section 112(l) Delegation Process

C. Section 112(i)(5) Early Reductions Program

V. Administrative Requirements

A. Docket

B. Executive Order 12866

C. Regulatory Flexibility Act

D. Paperwork Reduction Act

This preamble provides an overview of the rule implementing the

requirements of the section 112(j) program, and a detailed discussion

of the changes made to the proposed regulation.

The first section provides an overview of the requirements of the

regulation being promulgated today.

The second section provides background information on section

112(j) in the context of the 1990 amendments to the Act.

The third section provides a detailed discussion of the

requirements of the rule, including significant comments as well as

significant changes made since the proposal.

The fourth section of this preamble discusses the relationship of

the requirements of section 112(j) to other requirements of the Act

under other subsections of section 112 of the Act.

The fifth section of this preamble demonstrates that the rulemaking

is consistent with a number of federal administrative requirements.

This preamble makes use of the term ``State,'' usually meaning the

State air pollution control agency which will be the permitting

authority implementing the section 112(j) program. The reader should

assume that use of the word ``State'' also applies, as defined in

section 302(d) of the Act, to the District of Columbia and territories

of the United States, and may also include reference to a local air

pollution control agency. These agencies can either be the permitting

authority for the area of their jurisdiction or assist the State or the

EPA in implementing the section 112(j) program. In some cases, the term

``permitting authority'' is used and can refer to both State agencies

and to local agencies (when the local agency directly makes the

determinations or assists the State in making the determinations). The

term ``permitting authority'' may also apply to the EPA, in rare cases

where the EPA is the title V permitting authority responsible for the

program.

This preamble makes a number of references to a regulation which

has not yet been promulgated. That is the rule governing constructed,

reconstructed, or modified major sources under section 112(g) of the

Act, which EPA has proposed on April 1, 1994, in the Federal Register

at 59 FR 15504.

I. Summary of Final Rule

Today's rule implements the requirements of section 112(j) of the

Clean Air Act, as amended in 1990. Section 112(j) establishes

requirements for regulation of major sources of hazardous air

pollutants in the event that EPA lags more than 18 months behind

schedule in issuing a control technology standard for an industry.

Section 112 requires EPA to set MACT standards for all categories

of major sources of hazardous air pollutants. Specifically, the Act has

required EPA to issue a schedule for regulating all source categories

within 2, 4, 7, or 10 years of enactment. The source category schedule

for standards was published on December 3, 1993 (58 FR 63941).

Section 112(j) is triggered on the date 18 months after the

deadline listed in the final schedule for a source category, if the EPA

has failed to promulgate a MACT standard for that source category by

that date. These deadlines are displayed in Table 1. Upon this 18-month

deadline, the owner or operator of each major source with emission

units in that category must apply for a case-by-case MACT determination

by the title V permitting authority. There are four possible section

112(j) deadlines, as displayed in Table 1 below.

Table 1.--Section 112(J) Deadlines

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MACT standard deadline Section 112(j) deadline Comments

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2-year standards: May 15, 1994 [but not The EPA has

November 15, 1992. before effective date promulgated the 2-

of Title V permit year standards. This

program]. deadline will not be

triggered.

4-year standards: May 15, 1996........... This is the earliest

November 15, 1994. that section 112(j)

could be triggered.

7-year standards: May 15, 1999

November 15, 1997.

10-year standards: May 15, 2002

November 15, 2000.

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The EPA has fulfilled its requirements with respect to the 2-year

MACT standards, so there are essentially three possible dates upon

which section 112(j) requirements could take effect: (1) May 15, 1996,

(2) May 15, 1999, and (3) May 15, 2002. Section 112(j) cannot take

effect before the effective date of a title V permit program in a

State; the EPA expects that permit programs will be operative in all

States by May 15, 1996.

If the deadline for a particular category passes, section 112(j)

requires that any source associated with that category, that is part of

a major source, must obtain an ``equivalent emission limitation by

permit.'' ``By permit'' means that the emission limitation is recorded

in the title V operating permit. ``Equivalent emission limitation''

means a limitation, determined on a case-by-case basis by the

permitting authority, that is judged to be equivalent to the limit the

EPA would have established had the federal MACT standard been

published.

The rule uses the term ``emission unit'' rather than the term

``source'' which appears in section 112(j). The term ``source'' is used

to describe the extent of coverage of standards issued pursuant to

section 112(d) and section 112(h). The EPA is concerned that if the

term ``source'' is used in reference to section 112(j), there may be

potential misperceptions that section 112(j) determinations could

constrain the EPA's definition of ``source'' in a subsequent

rulemaking.

A. Requirements for Existing Emission Units

For emission units in existence at major source plant sites as of

the section 112(j) deadline, today's rule contains some important

clarifications of the Act. The statute is clear that applicants must

submit an application by the section 112(j) deadline, and that the

title V permitting process must be followed in establishing permit

conditions within an 18-month time frame thereafter. Within this

overall framework, the statute is less prescriptive regarding: (1) The

contents of the permit application, (2) the process that is used within

the 18-month permit issuance time frame to establish equivalent

emission limitations, and (3) the nature of the terms and conditions

that must be established in the permit.

Section 6.52 is intended to provide further clarity to the permit

review process. The requirements for permit application content are

listed in Sec. 6.53. Principles governing the establishment of MACT

emission limitations, including the nature of the terms and conditions,

are outlined in Sec. 6.55, and in a more detailed guidance document

titled: ``MACT Determinations under Section 112(j)'' (EPA 450/3-92-

007a), which EPA is making available today.

B. Requirements for New Emission Units

For new emission units subject to the requirements of section

112(j), today's rule provides a number of important statutory

interpretations, and provides a clarification of the minimum

administrative requirements of the Act.

When newly constructed emission points are added to an existing

major source plant site, those emission points could be considered as

either: (1) An addition to an existing ``emission unit'' for which an

existing source level of control would be required, or (2) an entirely

new ``emission unit'' for which new source MACT would be required.

Today's rule contains a definition of ``emission unit'' which gives

broad discretion to the permitting authority to determine whether a

given emission point or points should be treated as ``new.''

Another important clarification in the rule is the date which

triggers new source requirements. Today's rule defines as ``new'' an

emission unit for which construction commences after the section 112(j)

deadline or after proposal of a section 112 (d) or (h) MACT standard,

whichever comes first.

Section 112(j) of the statute does not mandate a preconstruction

review for new emission units subject to section 112(j). However, the

EPA recognizes that there are important reasons for permitting

authorities and affected source owners and operators to follow a

preconstruction or pre-operation review process. The rule contains, as

Sec. 6.54, an optional preconstruction or pre-operation review process

that can be used for this purpose.

C. Relationship to Subsequently Promulgated MACT Standards

The Act provides for a compliance extension when an emission unit

covered by a case-by-case MACT emission limitation under section 112(j)

is later affected by a subsequent federal MACT standard promulgated

pursuant to section 112(d) or section 112(h) of the Act. This provision

is addressed in Sec. 6.56 of today's rule.

II. Background Discussion

A. Clean Air Act Amendments: Section 112

The Clean Air Act Amendments of 1990 [Pub. L. 101-549] contain

major changes to section 112 of the Act pertaining to the control of

HAP emissions. Section 112(b) includes a HAP list that is composed of

189 chemicals, including 172 specific chemicals and 17 compound

classes. Section 112(c) requires publication of a list of source

categories and subcategories of major sources emitting these HAPs, and

also requires the listing of area sources that the EPA determines

warrant regulation. Section 112(d) requires promulgation of emission

standards for each listed source category or subcategory according to a

schedule set forth in section 112(e).

B. Clean Air Act Amendments: Provisions for Equivalent Emission

Limitation by Permit

1. General Requirements of Section 112(j)

The amendments to section 112 include new section 112(j). This

section is entitled ``Equivalent Emission Limitation by Permit.''

Subsection 112(j)(2) of the Act provides that section 112(j) applies if

EPA misses a deadline for promulgation of a standard under section

112(d) established

in the source category schedule for standards: In the event that the

Administrator fails to promulgate a standard for a category or

subcategory of major sources by the date established pursuant to

subsection (e) (1) and (3), and beginning 18 months after such date

(but not prior to the effective date of a permit program under title

V), the owner or operator of any major source in such category or

subcategory shall submit a permit application.

Subsection 112(j)(3) requires the owner or operator to submit a

permit application 18 months after the missed promulgation deadline:

By the date established by paragraph (2), the owner or operator

of a major source subject to this subsection shall file an

application for a permit.

Subsection 112(j)(3) also requires EPA to establish requirements for

permit applications, including content and criteria for the reviewing

agency to determine completeness. In addition, subsection 112(j)(3)

provides that if the reviewing agency deems the application incomplete,

or disapproves the application, then the applicant has up to 6 months

to revise and resubmit the application.

Subsection 112(j)(5) establishes a requirement for case-by-case

MACT determinations:

The permit shall be issued pursuant to title V and shall contain

emission limitations for the hazardous air pollutants subject to

regulation under this section and emitted by the source that the

Administrator (or the State) determines, on a case-by-case basis, to

be equivalent to the limitation that would apply to such source if

an emission standard had been promulgated in a timely manner under

subsection (d).

Subsection 112(j)(5) also establishes compliance dates:

No such pollutant may be emitted in amounts exceeding an

emission limitation contained in a permit immediately for new

sources and, as expeditiously as practicable, but not later than the

date 3 years after the permit is issued for existing sources or such

other compliance date as would apply under subsection(i).

Finally, subsection 112(j)(5) specifies that if the applicable

criteria for voluntary early reductions, established under section

112(i)(5), are met, then this alternative emission limit satisfies the

requirements of section 112(j), provided that the emission reductions

are achieved by the missed promulgation date.

In the event that EPA promulgates a given MACT standard for the

applicable source category before the permit application is approved,

the permit must reflect this promulgated standard, rather than the

case-by-case MACT determination. The source is required to comply with

this standard by the date provided under subsection(i). In this case,

the owner or operator of an existing source has no more than 3 years to

comply, and the owner or operator of a new source must comply

immediately upon startup, except that a new source that commenced

construction or reconstruction between proposal and promulgation of the

MACT standard may elect to comply with the proposed standard for 3

years in lieu of the promulgated MACT standard, if the promulgated MACT

standard is more stringent than the proposal.

In the event that EPA promulgates a given MACT standard after the

permit containing case-by-case emission limits is issued, section

112(j)(6) allows a longer compliance period:

If the Administrator promulgates a standard under subsection (d)

* * * after the date on which the permit has been issued, the

Administrator (or the State) shall revise such permit upon the next

renewal to reflect the standard promulgated by the Administrator

providing such source a reasonable time to comply, but no longer

than 8 years after such standard is promulgated or 8 years after the

date on which the source is first required to comply with the

emissions limitation established by paragraph (5), whichever is

earlier.

C. Implementation Principles

In designing guidance for case-by-case MACT determinations, the

EPA's thinking is guided primarily by the need for section 112(j)

standards to be substantively equivalent to section 112(d) MACT

standards. Subsection 112(j)(5) requires that a case-by-case MACT

determination be ``equivalent to the limitation that would apply to

such source if an emission standard had been promulgated in a timely

manner under subsection (d),'' and subsection 112(j)(6) requires

eventual compliance with subsequently promulgated section 112(d)

standards. Consistency in standard-setting will smooth a major source's

eventual transition from compliance with section 112(j) to compliance

with section 112(d), making implementation of toxics control easier on

both States and industry.

The EPA's other major goal in establishing section 112(j)

requirements is to achieve and maintain consistency across section 112

programs. The EPA intends for administrative and operational

requirements under section 112(j) to be consistent with the

requirements of section 112(g) rules for construction, reconstruction,

and modification of major sources (proposed at 59 FR 15504 on April 1,

1994, as Sec. 63.40 through 63.49 of subpart B) and with the general

provisions for section 112 (published at 59 FR 12408 on March 16, 1994,

as subpart A of this part). Section IV. A. of this preamble discusses

likely overlapping requirements and major substantive differences

across these programs.

III. Significant Comments and Changes to the Proposed Rule

This section of the preamble is organized by each topic area in

subpart B, and contains a detailed discussion of the principal

regulatory issues and changes made in the final rule, particularly in

response to public comments. It also discusses some comments that did

not result in regulatory changes.

A. Section 63.50--Applicability

1. Section 63.50(a)--Applicability

Paragraph 63.50(a) of today's rule indicates that the intent of the

rule is to implement section 112(j) of the Act. This paragraph

indicates that section 112(j) applies to the owner or operator of a

major source of HAPs after the ``effective date of a Title V program''

in each State, but not before May 15, 1994.

(a) Effective date of title V. The meaning of ``effective date of a

Title V program'' is indicated in the final regulations for

implementation of title V of the Act. Under these regulations, States

were required to submit a permit program for review by the EPA on or

before November 15, 1993. The EPA is required to approve or disapprove

the permit program within one year after receiving the submittal. The

EPA's program approval date is termed the ``effective date.''

The effective date of title V permit programs is defined in section

502(h) of the Act, which says ``The effective date of a permit program,

or partial or interim program, approved under * * * [Title V] * * *

shall be the date of promulgation.'' This language refers to two types

of title V programs: One type where the EPA ``approves'' the title V

program under 40 CFR part 70 and another type where the EPA

``promulgates'' a program. Programs ``approved'' by the EPA under part

70 will be developed by the State or local area and submitted to the

EPA for approval. The language in section 502(h) of the Act makes these

programs immediately effective upon EPA approval. Programs

``promulgated'' by the EPA are anticipated to be rare, and they occur

only where a State failed to submit a program, submitted a program that

EPA could not approve, or has failed to adequately administer an

approved program. For example, the EPA is required by section 502(d)(3)

of the Act to promulgate and administer a title V program if, by

November 1995, the EPA has not approved the State program. The language

in section 112(j), because it refers to the effective date of a title V

program in any State (and not by any State), means that the program

will apply to both the EPA ``approved'' and ``promulgated'' programs.

The title V regulations provide for approval of ``interim'' and

``partial'' programs in certain limited circumstances. The EPA believes

that, because partial programs must ensure compliance with ``all

requirements established under section 112 applicable to `major

sources' and `new sources','' and interim programs must ``substantially

meet the requirements of [title V],'' an interim or partial program

would trigger the requirements of section 112(j) for those sources

covered by the interim program.

(b) Major source. Section 112(j) applies only to an owner or

operator of a major source. Section 112(a)(1) of the Clean Air Act

defines major source as any stationary source or group of stationary

sources located within a contiguous area and under common control that

emits or has the potential to emit considering controls, in the

aggregate, 10 tons per year or more of any hazardous air pollutant or

25 tons per year or more of any combination of hazardous air

pollutants. The requirements of section 112(j) apply to all sources

that comprise a major source, but do not apply to nonmajor sources--

i.e. ``area sources.''

The determination of whether a source is major is based on the

source's ``potential to emit'', which is defined in subpart A of this

part. A source's potential to emit is based on its capacity to emit

hazardous air pollutants considering federally enforceable limits on

that capacity. If a source's potential to emit is equal to or greater

than 10 tons/yr of a single HAP, or 25 tons/yr of any combination of

HAPs, the source is a major source. The EPA is currently developing a

rule to further define a source's potential to emit for section 112

standards. This rule will also provide ways for an owner or operator of

a source to establish voluntary, federally-enforceable restrictions to

limit the source's potential to emit below the major source threshold.

This rule will also address the requirements for major sources that

subsequently reduce their emissions to less than major amounts. If a

source meets conditions in subpart A of this part for limiting its

potential to emit to below the major source threshold within the

timeframe established in the potential to emit rule, then it will not

be subject to the provisions of section 112(j) as long as the source

maintains its emission status.

2. Section 63.50(b)--Relationship to State and Local Requirements

Many State and local regulatory agencies maintain regulatory

programs that involve toxic air pollutant reviews for stationary

sources. This paragraph clarifies that the requirements of section

112(j) do not pre-empt any requirements of these programs that are at

least as stringent as today's rule.

3. Section 63.50(c)--Retention of State Permit Program Approval

Some States may not currently have specific legislative or

administrative authority sufficient to establish the case-by-case

emission limitations required by section 112(j). Paragraph 63.50(c)

requires that States obtain such statutory authority as a condition of

retaining their part 70 permit program approval.

B. Section 6.51--Definitions

1. Terms Defined in the General Provisions

A number of terms used in the proposed rule are defined for all of

40 CFR Part 63 in subpart A of this Part. The terms defined in subpart

A include:

* * * Administrator

* * * Area source

* * * Effective date

* * * Federally enforceable

* * * Hazardous air pollutant

* * * Major source

* * * Permit program

* * * Potential to emit

* * * Relevant standard

* * * Title V permit

The Subpart A General Provisions include a definition of

``federally enforceable'' which lists the types of limitations and

conditions that are considered federally enforceable. The preamble to

Subpart A outlines a set of principles that States and sources should

follow in order to ensure practicable enforceability. The EPA believes

that Subpart B should ensure that the case-by-case determinations are

practicably enforceable in the same way that Subpart A does for section

112(d) and section 112(h) MACT standards. Therefore, the EPA refers the

reader to the discussion of ``practicable enforceability'' in the

preamble to Subpart A for a discussion of the kinds of requirements

that the EPA would consider sufficient to ensure practicable

enforceability for case-by-case MACT determinations. In addition, a

more detailed discussion of the elements necessary to ensure federal

enforceability is contained in section III.E. of this preamble.

2. Terms Related to Maximum Achievable Control Technology

Definitions for the following terms related to levels of control

technology are included in Sec. 63.51 of today's rule:

* * * Maximum Achievable Control Technology

* * * Control Technology

* * * Maximum Achievable Control Technology (MACT) Floor

* * * Maximum Achievable Control Technology (MACT) Emission

Limitation for Existing Sources

* * * Maximum Achievable Control Technology (MACT) Emission

Limitation for New Sources

The basis for all of these definitions is statutory language

contained in section 112(d) of the Act. The term ``maximum achievable

control technology'' appears only in section 112(g) of the Act, and

does not appear elsewhere in section 112. There is, however,

considerable legislative history indicating that this term refers to

the level of control required by section 112(d) emission standards.

This term was used in this context in the House Bill, H.R. 3030. For

purposes of the definitions in today's rule, the EPA assumes that

``maximum achievable control technology'' is a reference to the

``maximum degree of reduction in emissions'' language contained in

section 112(d)(3). The minimum control technology requirements of

section 112(d), often referred to as the ``MACT floor'' are cited a

number of times in today's rule. To avoid repeating these requirements

each time, the regulation includes a definition of ``MACT floor.''

3. Terms Affecting the Extent of Coverage by Maximum Achievable Control

Technology

The following terms are used to describe equipment subject to a

MACT determination:

* * * Emission point

* * * Emission unit

* * * Emission limitation

* * * New emission unit

An ``emission point,'' in this regulation, is defined narrowly to

refer to any individual point of release to the atmosphere. However, an

individual MACT determination will often be made at once for a number

of emission points. The term ``emission unit'' is used to refer to the

collection of all emission points considered when a MACT determination

is made. The term ``emission limitation'' retains the meaning given to

it in section 302(k) of the Act.

New emission unit. The term new emission unit refers to an emission

unit for which construction or reconstruction is commenced after the

section 112(j) deadline for a relevant standard, or after proposal of a

relevant standard under section 112(d) or section 112(h) of the Act,

whichever comes first. For the purposes of section 112(j), new emission

units are those emission units that trigger new source MACT

requirements (see discussion of the definition of ``emission unit''

below). New source is defined in Clean Air Act section 112(a)(4) as

follows:

``* * * a stationary source the construction or reconstruction

of which is commenced after the Administrator first proposes

regulations under this section establishing an emission standard

applicable to such source.''

Section 112(j) requires States to establish case-by-case MACT

limitations where EPA has failed to promulgate a relevant standard, and

there may be instances when a section 112(j) MACT limitation is

required for a source category for which a standard has not yet been

proposed under section 112(d). Since section 112(j)(5) refers

explicitly to case-by-case standards for new sources, the EPA has

determined that the Act did not intend that the EPA's failure to

propose a standard implies that no sources in that source category, no

matter what the date of construction, could ever be considered ``new.''

At proposal the EPA had selected the section 112(e) scheduled deadline

as the date, under a section 112(j) case-by-case MACT determination,

most closely equivalent to the section 112(d) proposal date for the

purposes of defining ``new emission unit,'' because had EPA met the

schedule in setting a standard under section 112(d) the proposal could

not have been any later than the date in the schedule. The EPA

requested comment on this definition. Three commenters supported the

proposed definition. However, upon consideration of the practical

concerns raised by this definition, the EPA has determined that the

section 112(j) deadline would be a more reasonable date beyond which

commencing construction of an emission unit would be considered

``new.''

The following timeline illustrates the EPA's reasoning:

TR20MY94.002

Under the proposed rule, a source would have needed to know, up to 2

years or more in advance of the section 112(j) deadline, that the EPA

was going to miss its scheduled promulgation deadline by 18 months. If

``new source'' requirements were triggered by the section 112(e)

deadline, owners and operators would need to know this in order to plan

what control to build in to their new emission units, and perhaps in

order to apply for preconstruction review. In addition, if an owner or

operator plans to construct between the scheduled promulgation date and

the section 112(j) deadline, and there is a subsequent proposal (as

illustrated in the timeline), then whether the emission unit will be

considered new would depend upon a later event--whether the section

112(j) deadline will pass with no federal MACT standard. The EPA

believes that it is not reasonable to expect owners and operators to be

able to predict the likelihood of EPA missing a promulgation deadline

by 18 months; nor is it reasonable to expect them to make such a

prediction as much as 2 years before its occurrence.

Thus, if EPA proposes a MACT standard before the section 112(j)

deadline, any emission unit for which construction commences after that

proposal will be considered new. If the section 112(j) deadline is

reached without EPA having proposed a standard, then an emission unit

for which construction commences after the section 112(j) deadline will

be considered new. This approach removes the uncertainty raised by the

possibility of EPA proposing a MACT standard during the 18 months

between the section 112(e) schedule deadline and the section 112(j)

deadline. The EPA believes this to be the most reasonable and equitable

way to define which emission units are new for purposes of section

112(j).

Emission unit definition; applicability to new source MACT. MACT

determinations must be made on a wide variety of emitting equipment at

major sources in different source categories. Today's rule defines

emission unit in a way designed to allow permitting authorities broad

flexibility in designing case-by-case MACT emission limitations. This

flexibility is essential because of the variety of source categories,

diverse in size and complexity, that may be subject to section 112(j).

A narrower definition of emission unit would make it difficult for

permitting authorities to tailor MACT determinations to the equipment

specific to a particular source category. Emission unit as defined in

this rule is intended to be synonymous with the term ``source'' as used

in section 112(d). Thus, the State permitting authorities implementing

section 112(j) will have as much flexibility in defining emission unit

as EPA has in defining ``source.'' The definition of source used in

section 112 originated in section 111 a number of years ago. That

definition--any building, structure, facility, or installation which

emits or may emit any (hazardous) air pollutant--has been interpreted

over the years to encompass a broad range of things including

individual process units, production lines and entire plants.

The EPA requested comment both on the desirability of requiring or

not requiring new source MACT on all new emission units, and on the

question of whether new source MACT should be required only on those

emission units that are in and of themselves ``major'' at a major

source.

An approach the EPA considered, but rejected, would be to require

new source MACT only on those emission units that are in and of

themselves ``major'' at a major source--i.e. those emission units at a

major source which themselves emit at least 10 tons per year or more of

a single HAP, or 25 tons per year or more of a combination of HAPs.

This approach generated significant comment. Some commenters disagree

with this approach and support the approach taken in the rule. Many

commenters support the alternative approach.

The EPA agrees with the commenters who support application of new

source MACT to all constructed and reconstructed emission units.

Section 112(j) is intended to stand in place of section 112(d) where

EPA has missed the section 112(e) scheduled date for a category of

major sources. Under section 112(d), when a MACT standard is written

for a major source category it will apply to all sources within that

category. Depending on how the category is defined many of the covered

sources will be a less than 10 ton portion of a major source. These are

not area sources.

Many major sources will be covered by multiple MACT standards, and

the portion of a major source covered by any one MACT standard may well

be less than major by itself. In addition, a major source could contain

several emission units that are all covered by the same MACT standard,

but are separate sources that in combination exceed 10 or 25 tons but

do not exceed the major source threshold individually. In contrast,

area sources in the same category will not be subsets of major sources.

Section 112(j) does not apply to categories of area sources.

Other commenters assert that EPA's interpretation runs counter to

either the Clean Air Act itself, or to the Congressional intent behind

the language in the Act. For the reasons discussed below and in the

preamble to the proposed rule (58 FR 37778), the EPA disagrees with

these commenters.

Prior to a missed promulgation deadline, through section 112(g) the

statute clearly requires new source MACT only on constructed or

reconstructed major sources. Any other equipment added to an existing

major source would be a modification (unless specifically exempted from

regulation by section 112(g)), and would be subject to existing source

MACT levels of control. However, the language of section 112(j) is

somewhat different from that of section 112(g). Section 112(j), while

applying only to major sources, does not limit the application of new

source MACT to new major-emitting equipment, as section 112(g) does.

The EPA believes that the standards developed through section

112(j) must anticipate and reflect the likely requirements of section

112(d) and section 112(h). The basis for the applicability of new

source MACT selected is the section 112(j)(5) requirement that case-by-

case MACT standards must be:

Emission limitations for the hazardous air pollutants * * * emitted

by the source that the Administrator (or the State) determines, on a

case-by-case basis, to be equivalent to the limitation that would

apply to such source if an emission standard had been promulgated in

a timely manner under subsection (d).

It is the judgment of EPA that section 112(j) case-by-case MACT

standards must require new source MACT to be applied to those same

sources, within a covered major source, to which a standard promulgated

under section 112(d) would apply new source MACT. Therefore, it is

necessary to determine what entity is considered a new source under

section 112(d) for the purpose of implementing MACT standards.

Section 112(a) provides that new source shall mean a ``stationary

source the construction or reconstruction of which is commenced after

the Administrator first proposes regulations under this section

establishing an emission standard applicable to such source.'' Section

112(a)(3) gives ``stationary source'' the same meaning as under section

111(a), i.e. any new ``building, structure, facility, or

installation''; thus the term stationary source clearly is not limited

to major sources under section 112(a)(3). Section 112(d) requires MACT

standards to be set for ``sources,'' and ``sources'' can be major,

area, or portions of a major source. Once there is a section 112(d)

standard in place, any new source will be required to meet new source

MACT emission limitations, as defined by the standard. Thus, under

section 112(j), any new emission unit that is either part, or all, of a

major source will be required to meet new source MACT.

If, however, the language of section 112(g) were interpreted as

dispositive of whether new or existing source MACT must be applied to

any given increase in emissions, new sources within the definition in

section 112(a)(4) would escape having to comply with new source MACT

under section 112(j). If a MACT standard under section 112(d) may

establish a definition of source that would apply to a portion of a

``major source,'' then section 112(j) case-by-case MACT determinations

would not satisfy the requirement that they be ``equivalent to the

limitation that would apply to such source * * *''

In addition, under this reading, major sources adding new sources

that are not major by themselves could avoid new source MACT on those

new sources. But if MACT is then set under section 112(d) for area

sources in that category, any new area source would have to meet new

source MACT, while new parts of a major source would not. This would be

an anomalous result. Therefore today's rule requires new source MACT on

all emission units that are constructed or reconstructed at a major

source plant site.

C. Section 6.52--Approval Process for New and Existing Emission Units

Existing emission units. Section 6.52 of the rule requires that

case-by-case MACT determinations for existing emission units be

established through the title V permit process. The owner or operator

of an existing major source must submit a permit application for all

emission units in a source category not later than 18 months after the

missed promulgation date for that source category. The State must then

review and approve or disapprove the permit in accordance with the

procedures and principles set out in Part 70 and in Sec. 63.55 of

today's rule. Section 63.52(b)(1) of today's rule implements the

requirement in section 112(j)(4) of the Act that if an owner or

operator's permit application is deemed incomplete or disapproved by

the permitting authority, the owner or operator has up to 6 months to

resubmit and meet the requirements of the permitting authority. The

final rule clarifies the intent of the Act that the owner or operator

provide complete information within 6 months of the date the permitting

authority ``first'' identifies its objections. The addition of the word

``first'' is intended to clarify that the applicant may not prolong the

process by resubmitting an incomplete application. In order to ensure

that the application indeed satisfies this 6-month deadline, applicants

will probably wish to respond sooner than 6 months.

For existing emission units, the permitting authority at its

discretion may require compliance as expeditiously as practicable, but

no later than 3 years from permit issuance. In addition, the permitting

authority may allow an extra year, on a case by case basis, when

necessary for the installation of controls. This approach is consistent

with section 112(j)(5), which requires the case-by-case MACT standards

to ensure compliance ``* * * immediately for new sources and, as

expeditiously as practicable, but not later than the date three years

after the permit is issued for existing sources or such other

compliance date as would apply under subsection (i).''

New emission units. Section 63.52 describes the relationship of the

MACT review process for new emission units to the operating program

requirements pursuant to Title V of the Act Amendments. The

requirements for title V permits, contained in 40 CFR part 70, were

published on July 21, 1992 (57 FR 32250). For existing emission units,

the approach to establishing an administrative process for

determinations under section 112(j) of the Act is to rely on the title

V review process as the mechanism for establishing MACT requirements.

For new emission units, however, the EPA believes that reliance on the

title V permit process may not be sufficient. First, the title V

requirements clearly do not require a new ``greenfield'' plant to apply

for an operating permit until 1 year after the plant begins operation.

Because the title V permit must be issued within 18 months of the

application, it could be up to 30 months after commencement of

operation before section 112(j) requirements would be incorporated into

the permit. Second, the title V requirements do not ensure that a MACT

determination will be conducted before construction. While in some

cases permitting authorities with title V programs may require

preconstruction reviews as part of the operating permit process, this

will not always be the case.

Therefore, while for existing emission units the title V permit

process is sufficiently comprehensive to handle section 112(j) reviews,

the EPA believes, based upon the above considerations, that when the

title V process does not occur until after construction has begun, new

emission units should be subject to preconstruction or at least pre-

operation review. However, the statutory language of section 112(j)

does not authorize EPA to mandate either process.

While many commenters also challenged the legality of requiring

preconstruction review, several others agreed with EPA's reasons, as

stated in the proposed rule, in support of a preconstruction review.

Commenters noted that without preconstruction review, owners and

operators will not know their requirements before startup, making it

more difficult for them to design equipment with controls that the

permitting authority is guaranteed to approve. In addition, some

permitting authorities will be deprived of the authority they need to

make appropriate new source MACT determinations. In addition, it was

noted that some permitting authorities will be prohibited from adopting

preconstruction review programs unless they are federally mandated.

The EPA believes that most new equipment covered by section 112(j)

will require some type of State preconstruction permit, for criteria

pollutants if not for HAP. Although the Act does not mandate the

communication of section 112(j) requirements until the eventual

operating permit process, the EPA believes that it would be in the best

interests of both the owner or operator and the permitting authority to

resolve section 112(j) issues as part of its upfront review.

Regardless of the timing for incorporation of section 112(j) new

source MACT determinations into the operating permit, there are certain

requirements that apply. The title V permit must be revised or issued

according to procedures set forth in Sec. 70.7 and 70.8, or issued as a

general permit. In addition, the permit must incorporate the compliance

provisions of Sec. 70.6. If, during the EPA's review of the section

112(j) determination, it becomes apparent that the determination is not

in compliance with the Act, then EPA must object to the issuance or

revision of that permit.

These requirements are obviously satisfied either when part 70

requires revision to an existing title V permit before construction, or

when the permitting authority otherwise requires incorporation of

conditions into a title V permit as a step in the section 112(j) new

source case-by-case MACT determination process. However, even when

there is no formal incorporation of conditions into a title V permit

before operation, subsequent additional title V review may effectively

be avoided if the State's section 112(g) or optional section 112(j)

process is ``enhanced'' to include the important title V procedures,

thereby allowing for later incorporation into the title V permit by

administrative amendment. (The optional procedures contained in

Sec. 63.54 of the rule are intended to provide an example of such an

``enhanced'' process).

Section 70.7(d) of the operating permits rule defines an

``administrative amendment'' to include a revision that

``[i]ncorporates into the part 70 permit the requirements from

preconstruction review permits authorized under an EPA-approved

program, provided that such a program meets procedural requirements

substantially equivalent to those contained in Sec. 70.7 and 70.8 of

this Part . . . and compliance requirements substantially equivalent to

those contained in Sec. 70.6 of this part.'' This process of

``enhancement'' of preconstruction procedures was discussed in the

preamble to the operating permits rule in the context of existing State

new source review programs (see 57 Fed. Reg., at 32289), but was not

discussed in relation to section 112(j) because the procedures

associated with section 112(j) determinations had not yet been

articulated. However, the language of Sec. 70.7(d)(v) would allow for

use of administrative amendments for an enhanced preconstruction review

process, and the EPA believes such use is clearly within the intent of

that provision.

Enhancement of the preconstruction review process may be partial

only, incorporating some elements of the required part 70 review or

compliance provisions in the preconstruction review process itself,

with the remaining elements occurring during the title V process. For

instance, public review of the MACT determination that meets the

requirements of Sec. 70.7(h) need not be repeated at the time of

incorporation into the title V permit. However, for the administrative

amendment procedures to be available for determinations that have been

through an enhanced process, the public, EPA and affected States must

have had the opportunity to review all aspects of the MACT

determination, including any compliance provisions required under

Sec. 70.6. Thus, public review during the preconstruction review

process would not suffice for purposes of title V if the process did

not specify the application of compliance provisions substantially

equivalent to those in Sec. 70.6, including monitoring, reporting,

recordkeeping, and compliance certification.

Finally, Sec. 6.52(d) of today's rule establishes that new emission

units must comply with case-by-case MACT determinations at permit

issuance. This requirement is unchanged from proposal. At proposal the

EPA solicited comment on the implementation consequences for sections

section 112(j) and section 112(d) when preconstruction review is not

required, and on the likely consequences of the lack of an adequate

enforcement mechanism at the federal level for compliance earlier than

permit issuance. Commenters noted the need to prevent situations in

which some sources might have to retrofit in response to subsequent

rulemaking under section 112(d). Commenters also pointed out the likely

negative effect on the public of the compliance delays inherent in

section 112(j) for new emission units, as well as the inability of some

permitting agencies to adopt requirements more stringent than mandated

by the federal government.

In addition, precedent across the board in federal air regulation

requires new sources to comply with control requirements upon startup.

The EPA believes that new emission units should undergo preconstruction

or pre-operation review. However, the EPA believes that the language of

section 112(j)(5), which specifies that ``[n]o such pollutant may be

emitted in amounts exceeding an emission limitation contained in a

permit immediately for new sources,'' does not give the Agency

authority to require compliance with case-by-case MACT by new emission

units until a permit is issued.

The EPA believes that, especially when project lead time is

sufficient, that the best approach would be for a permitting authority

to provide for an ``enhanced'' preconstruction review process that

would assure the source that it would be in compliance with section

112(j). Because the ``enhanced'' review would yield terms and

conditions that could be incorporated into the title V permit by

administrative amendment, ``permit issuance'' would thus be

accomplished upon startup rather than 12-30 months later. In this case,

the source would be in compliance with federally enforceable case-by-

case MACT at the time of administrative amendment to its title V

permit.

Subsequent changes to a major source. The EPA believes that section

112(j) emission limitations apply to subsequent changes made at major

sources already complying with case-by-case MACT limitations under

section 112(j), when EPA has not promulgated a final standard for the

source category under section 112(d). The EPA requires, in subpart A of

this Part, that subsequent changes to a major source already complying

with a section 112(d) or (h) standard shall comply with established

MACT emission limitations for the source to which changes are made.

Therefore requiring subsequent changes to portions of major sources

already meeting case-by-case MACT emission limitations under section

112(j) satisfies the section 112(j)(5) statutory requirement that case-

by-case MACT determinations under section 112(j) be ``equivalent to the

limitation that would apply to such source if an emission standard had

been promulgated in a timely manner under subsection(d).'' Emission

limitations governing those changes would be incorporated into a

source's title V permit according to procedures established pursuant to

title V.

The EPA requested comment on this approach, as well as on the

alternative approach of treating section 112(j) as a one time

permitting requirement applicable 18 months after EPA fails to set a

relevant MACT standard. This would require subsequent changes at major

sources with section 112(j) permits to comply only with section 112(g).

The EPA received a few comments on this issue, most of which agree with

EPA's approach, and one which asserts that prior determinations under

section 112(g) should be deemed to satisfy section 112(j). The EPA

believes that determinations made under section 112(g) that require

MACT control should be considered by the permitting agency to be

sufficient to satisfy the control requirements of section 112(j).

Therefore the EPA retains the interpretation contained in the proposed

rule. (See also the discussion of potential differences in section

112(g) and section 112(j) requirements in section IV. A. of this

preamble).

General permits. The EPA recognizes that there are cases for which

sources would prefer to minimize delays in the process, particularly

for operations which change relatively frequently, and when the owner

or operator is willing to control emissions from those changes with

technologies that could be recognized as best available controls (i.e.

those controls which achieve ``the emission control that is achieved in

practice by the best controlled similar source'' (section 112(d)(3) of

the Act)). General permit procedures, outlined in 40 CFR 70.6(d), could

be available for such situations.

The general permit would have application for section 112(j)

determinations when the permitting authority is able to make a

presumptive determination of MACT for a given type of source. The

general permit would have to set forth the controls required by Part

70. Once the general permit is issued, application of the MACT

determination to a particular emission unit would involve merely a

determination that the emission unit falls within the source category

covered by the general permit. In this way, a single permitting process

could be used to address the section 112(j) requirements for a number

of facilities, rather than conducting a separate process for each

facility. Such a general permit process would not relieve the owner or

operator from the obligation of submitting an ``application'' by the

section 112(j) deadline. The EPA envisions, however, that permitting

authorities could provide guidance to the affected facilities, before

the section 112(j) deadline, of its intention to use the general permit

process such that the burdens of the application are minimized.

As discussed in the preamble to the operating permit regulation,

general permits may be issued to cover discrete emissions units at

permitted facilities. 57 Fed. Reg., at 32279. While a general permit

cannot be used to modify the terms of an existing title V permit, it

may be issued to cover a change at an existing plant, such as addition

of a new emission unit, that would otherwise be eligible to apply for a

new individual permit. In that case, the requirements of the general

permit could be incorporated into the permit for the facility at permit

renewal.

Several commenters agree that using the general permit procedures

is a good idea, in order to streamline MACT determinations under

section 112(j). The EPA agrees that general permits could be used both

for existing and new emission units.

Area sources that become major sources. Today's rule states that

section 112(j) requirements apply to all major sources in a source

category for which EPA has missed its scheduled promulgation deadline.

Implicit in that requirement is the assumption that the requirements of

section 112(j) apply to area sources that increase their emissions or

their potential to emit such that they become major sources after the

section 112(j) deadline.

Subpart A of this part, recently promulgated, explicitly

establishes, for MACT standards under section 112(d) or (h), that area

sources which increase their emissions, or their potential to emit,

such that they become major sources after the applicable date of a

relevant standard, are subject to the requirements of that standard.

Therefore EPA has added Sec. 63.52(f)(1) to today's rule to clarify

that the requirements of section 112(j) likewise apply to area sources

that increase their emissions or their potential to emit such that they

become major sources after the section 112(j) deadline.

One commenter requests clarification on the status of area sources

which, after the section 112(j) deadline, become major sources when EPA

determines that a ``lesser quantity'' of emissions defines ``major

source'' for that source category (see section 112(a)(1)). Therefore

EPA has added Sec. 63.52(f)(2) to today's rule to clarify that the

requirements of section 112(j) apply to all major sources at the point

at which they are determined to be ``major sources'' under section

112(a). These sources are required to submit permit applications within

6 months of becoming major sources. Given the relative siginificance of

the regulation these sources, the EPA believes that requiring permit

applications within 6 months is reasonable.

As discussed previously, the rule generally treats emission units

as ``new'' if constructed after the section 112(j) deadline. However,

in the case where that area source becomes major because the EPA has

set a lesser quantity emission rate after the section 112(j) deadline

for the relevant source category, the EPA recognizes that it would be

inequitable to require new source MACT for such an emission unit at an

existing area source plant site. It would be difficult for any source

constructed at an earlier date to immediately meet new source MACT upon

permit issuance. Such a position would require sources to retrofit to a

new source MACT level of control, despite the fact that, at the time of

a MACT proposal or the section 112(j) deadline, those sources would not

have any reason to anticipate that section 112(j) would appply.

Therefore today's rule has been clarified to provide that, where a

source is not subject to section 112(j) on the section 112(j) deadline,

but becomes subject to section 112(j) at a later date by becoming a

major source, new source MACT will be limited to those emission units

for which construction or reconstruction has commenced after the date

that the source becomes major. This avoids the inequitable outcome of

requiring such sources to retrofit new source MACT.

The rule provides two exceptions to this approach. Consistent with

subpart A (59 FR 12408), if the owner or operator wishes to construct

or reconstruct an emission unit that would cause the plant site to now

become a major source, that emission unit would be treated as ``new.''

Or, if a source, which has been constructed or reconstructed after the

section 112(j) deadline and which has been an area source by virtue of

a limitation on its potential to emit, becomes a major source by virtue

of a relaxation of its emission limitation, then the emission units

whose emission limitations increase would be treated as ``new.'' (This

latter exception is intended to be consistent with subpart A of this

part, and with provisions in Sec. 52.21(r)(4) in the criteria pollutant

program). For these reasons, the definition of new source says ``. . .

except as provided for in Sec. 63.52(f)(1),'' and Sec. 63.52(f)(1)

clarifies these exceptions.

D. Section 63.53--Application Content for a Case-by-Case MACT

Determination

Section 63.53 of today's rule describes the information the owner

or operator is required to provide with an application for a MACT

determination. These information requirements are designed to identify

the emission units to be controlled and to demonstrate that MACT will

be met.

E. Section 63.54--Preconstruction Procedures for New Emission Units

Section 112(j), when read together with title V, presents certain

ambiguities which must be resolved in this rulemaking. Section 112(j)

requires case-by-case determinations of MACT for new as well as

existing sources. Section 112(j)(5) directs that case-by-case MACT is

to be ``equivalent to the limitation that would apply to such source if

an emission standard had been promulgated in a timely manner under

subsection(d).'' The timing for application for new sources subject to

any standard promulgated under section 112(d) is in turn articulated in

section 112(i)(1), which prohibits the construction of a new major

source or reconstruction of an existing major source except when there

has been a determination that the construction or reconstruction will

meet the MACT standard.

However, the timing of this determination for new sources under

section 112(j) is different than the timing required by the statute for

section 112(d) standards. Section 112(j) requires that the permit

containing the case-by-case determination of MACT be ``reviewed and

approved or disapproved according to the provisions of section 505''

(section 112(j)(4)) and issued ``pursuant to Title V,'' (section

112(j)(5)). This conflicts with a requirement for preconstruction or

pre-operation review for new sources subject to only section 112(j),

because title V does not give EPA discretion to require applications

for sources newly subject to the title earlier than 12 months after

commencing operation. (Section 503(c)). (States may, however, opt to do

so). Because the Part 70 permit must be issued within 18 months of the

application, it could be up to 30 months after operation before section

112(j) requirements would be incorporated into the title V permit.

While several commenters state that section 112(j) MACT

determinations should be subject to preconstruction review, a number of

others argued that section 112(j) contains no authority for

preconstruction review. A number of commenters addressed the

relationship of section 112(j) to section 112(g). Several of these

commenters argued that both sections should be reviewed, and the more

stringent requirement applied in each case. Other commenters stated

that the two sections should be applied consistently.

The EPA agrees that section 112(j) determinations for new sources

should be subject to preconstruction or pre-operation review. However,

the Agency acknowledges, as pointed out by other commenters, that

section 112(j) does not provide the EPA with independent authority to

require such review. Therefore, in the final rule EPA is not changing

its proposal that section 112(g) provide the mechanism for review for

modifications to major sources and construction of new major sources.

An optional preconstruction review process is provided in this rule for

the benefit of new emission units not covered by section 112(g).

As noted above in Section III.C. of this preamble, the EPA believes

that sources subject to case-by-case MACT determinations should undergo

upfront review. While in some cases States may require review under the

Part 70 program to occur in the preconstruction phase (or an

``enhanced'' preconstruction process deemed equivalent), the Act does

not authorize EPA to mandate this result. It follows that, while title

V is sufficiently comprehensive to handle the section 112(j) review

process for existing emission units, it is not broad enough in its

mandatory coverage to implement section 112(j) for new emission units.

EPA believes that the preconstruction or pre-operation review

requirements for control technology determinations under section 112(g)

will be applicable to many new sources subject to section 112(j). For

example, construction of all new major sources, and all new emission

units constructed as part of a modification to an existing major

source, would require preconstruction or pre-operation review under

section 112(g). Permitting authorities also have the option of

establishing an administrative process for preconstruction or pre-

operation review of new emission units subject to section 112(j), to

cover those emission units not subject to the requirements of section

112(g). In addition, section 112(j) requirements should be considered

for new emission units requiring other preconstruction permits under a

permit authority's overall air quality program.

As an alternative to relying on the upfront review procedures of

section 112(g) for new major sources, EPA had considered relying on the

language of section 112(i)(1) to require preconstruction review of new

sources under section 112(j). However, section 112(i)(1) requires

preconstruction review only for major-emitting sources. Such major-

emitting sources would already be required to undergo preconstruction

review under the requirements of section 112(g). Therefore adding a

requirement for preconstruction review under section 112(j) based on

section 112(i)(1) adds nothing to the process. For this reason EPA

rejected reliance on section 112(i)(1) authority.

Section 63.54 of today's rule describes an optional preconstruction

review process for new emission units not required to undergo upfront

review under section 112(g). Permitting authorities need not provide

this additional preconstruction review opportunity. Moreover, since the

preconstruction review process set forth in Sec. 63.54 is optional,

permitting authorities may provide for a different process. The

procedures set forth in Sec. 63.54 contain the elements EPA believes to

be necessary for an ``enhanced'' review process that can be

incorporated into the title V permit by administrative amendment. One

important aspect of such ``enhanced'' procedures is to ensure Federal

enforceability. In addition to the discussion in this preamble, the

preamble to subpart A of this part discusses the kinds of requirements

that the EPA would consider sufficient to ensure federal enforceability

for MACT determinations under Clean Air Act sections section 112(d) and

(h); the EPA believes that these same requirements would ensure federal

enforceability for case-by-case MACT determinations under section

112(j), and refers the reader to that discussion.

The EPA believes that the majority of new emission units subject to

section 112(j) will be subject to section 112(g) preconstruction or

pre-operation review requirements prior to filing their permit

applications under Part 70. The overall process for MACT determinations

contained in Sec. 63.54 of today's rule is shown in Figures 1 and 1a.

For those sources not subject to review under section 112(g), the

optional ``enhanced'' review process begins with a MACT application

consistent with the principles described in Sec. 63.55. The owner or

operator provides an application for a MACT determination to the

permitting authority. The contents of this application are outlined in

Sec. 63.53. This application for a MACT determination is then evaluated

by the permitting authority according to procedures described in

Sec. 63.54(b). If approved, the permitting authority would issue a

Notice of MACT Approval containing the basic elements described in

Sec. 63.52(c). Provisions dealing with compliance with the requirements

of the Notice of Approval are described in Sec. 63.54(c) through (g).

Terms and conditions of this Notice could be incorporated into the

operating permit by an administrative amendment.

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The EPA believes that there are substantial implementation

advantages to upfront review for emission units subject to section

112(j), as noted above in section III.C. of this preamble. Without such

review, owners and operators cannot be assured that they will meet a

``new source MACT'' level of control when submitting a title V permit

application.

The preconstruction or pre-operation process outlined in Sec. 63.54

begins with a completeness determination. Once a complete application

is received, approval or an intent to disapprove the application is

required. If an intent to disapprove is issued, the owner or operator

is given the opportunity to provide further information.

Section 63.54(b) establishes an administrative process for

reviewing a request by an owner or operator for a MACT determination.

The proposed decision to either approve or disapprove the application

is then subject to public review. (See discussion in the proposed rule

at 58 FR 37778.) Today's rule would provide for public review through

issuance of a notice containing all the relevant background information

about the application and 30 days for the public to comment on whether

the application should or should not be granted. Section 63.54(d)

establishes the opportunity for EPA to review and veto the application

consistent with the requirements of the title V process. In order to

expedite approval of noncontroversial case-by-case MACT determinations,

today's rule would allow such determinations to be made final following

the close of the comment period if no adverse comments have been

received. If adverse comments are received, a final notice should be

published either approving or disapproving the application and

addressing the comments. The EPA envisions that the permitting

authority would exercise its discretion in determining, where

warranted, that a public hearing should be held.

Emission limits that are federally enforceable include limits on

the allowable capacity of the equipment; requirements for the

installation, operation and maintenance of pollution control

technologies; limits on hours of operation; and restrictions on amounts

of materials combusted, stored, or produced. These limitations or

conditions should be practicably enforceable and ensure adequate

testing, monitoring, and recordkeeping to demonstrate compliance with

the limitations and conditions. These conditions are based on the five

criteria for Federal enforceability established in 40 CFR parts 51 and

52 (54 FR 27274). Part of the criteria for conferring Federal

enforceability to a State or locally established emission limitation

requires the emission limitation to undergo some public scrutiny and be

kept in standardized files in EPA's Regional Offices. In addition, the

emission limitation must be enforceable as a legal and practical

matter. The preamble to the proposed rule contains a more detailed

discussion of the kinds of permit conditions the EPA considers

necessary to establish Federal enforceability.

The end result of the administrative review process for new

emission units is a determination set forth in a document that is

termed a ``Notice of MACT Approval.'' Necessary elements for this

Notice are provided in paragraph 63.52(c) of today's rule. This Notice

should contain the emission limitations, notification, operating and

maintenance, performance testing, reporting, recordkeeping, compliance

dates, and any other requirements needed to ensure that the case-by-

case MACT emission limitation will be met.

The Notice of MACT Approval serves to ensure that the new emission

unit is built with controls that meet the requirements of section

112(j). If the Notice is approved through an ``enhanced'' process, it

can be incorporated into the title V permit through administrative

amendment.

F. Section 63.55--Maximum Achievable Control Technology (MACT)

Determinations for Emission Units Subject to Case-by-Case Determination

of Equivalent Emission Limitations

As discussed previously, Sec. 63.52 requires case-by-case MACT

determinations after the effective date of a title V permit program in

a State. MACT determinations will be conducted for all HAP-emitting

equipment that is located at a major source and is in a source category

for which the Agency has failed to promulgate a relevant maximum

achievable control technology (MACT) standard within 18 months of the

scheduled promulgation date. This section of the preamble discusses

principles and procedures for making these MACT determinations. These

include procedures needed to establish a MACT emission limitation and a

corresponding MACT control technology. In the rule, the overall process

for MACT determinations is outlined in Sec. 63.55.

The primary emphasis is on the procedures for case-by-case MACT

determinations when no applicable MACT standard has been proposed by

the EPA. The procedures for determinations after MACT standards have

been proposed are more straightforward.

Section 63.55 contains general principles that would govern MACT

determinations under today's rule. In general, the purpose of a case-

by-case MACT determination is to develop technology-based limitations

for HAP emissions that the Administrator (or a permitting agency to

whom authority has been delegated) approves as equivalent to the

emission limitations required for the source category if promulgated

MACT standards were in effect under section 112(d) or section 112(h) of

the Act.

The EPA believes that if a MACT standard has been proposed, but not

yet promulgated, this proposed standard is the best estimator of the

Agency's final action, and therefore should be considered in

establishing a case-by-case MACT emission limitation. Accordingly,

paragraph 63.55(a)(1) requires that in the absence of a supportable

alternative, the equivalent emission limitation should be at least as

stringent any such proposed standard. (Permitting authorities retain

the option of requiring MACT that is different from EPA's MACT

determination, provided that the alternative can be supported. An

example of such a supportable alternative would be the case where a

permitting authority possesses additional data that would support

amending EPA's floor finding).

When no MACT standard has been proposed, the rule requires that the

case-by-case MACT determination be consistent with the overall

requirements described in section 112(d) of the Act.

Section 112(d)(3) of the Act describes the general considerations

for a MACT determination. A MACT level of control is ``the maximum

degree of reduction in emissions of the hazardous air pollutants * * *

that the Administrator, taking into consideration the cost of achieving

such emission reduction, and any non-air quality health and

environmental impacts and energy requirements, determines is achievable

for new and existing sources in the category or subcategory * * *''

This paragraph of the Act continues to describe a number of items that

might be considered in designing MACT standards such as material

substitutions, enclosure of processes, capture and control of

emissions, design and work practice standards, and operational

standards. This list of items is included in the definition of

``control technology'' in Sec. 63.51 of today's rule.

Section 112(d) also imposes certain minimum requirements on the

determination of ``maximum achievable control technology.''

Collectively, these minimum requirements are defined in the rule as the

``MACT floor.''

For existing emission units, the MACT floor for the case-by-case

determination, consistent with section 112(d) of the Act, is an

emission limitation equal to the average emission limitation achieved

by the best performing 12 percent of existing sources in the category

for categories or subcategories with 30 or more sources, or the average

emission limitation achieved by the best 5 sources for categories with

fewer than 30 sources.

In rules currently under development, the EPA is considering two

interpretations of the statutory language concerning the MACT floor for

existing sources. One interpretation groups the words ``average

emission limitation achieved by'' the best performing 12 percent. This

interpretation places the emphasis on ``average.'' It would correspond

to first identifying the best performing 12 percent of the existing

sources, then determining the average emission limitation achieved by

these sources as a group. Another interpretation groups the words

``average emission limitation'' into a single phrase and asks what

``average emission limitation'' is ``achieved by'' all members of the

best performing 12 percent. In this case, the ``average emission

limitation'' might be interpreted as the average reduction across the

HAP emitted by an emission point over time. Under this interpretation,

the EPA would look at the average emission limits achieved by each of

the best performing 12 percent of existing sources, and take the

lowest. This interpretation would correspond to the level of control

achieved by the source at the 88th percentile if all sources were

ranked from the most controlled (100th percentile) to the least

controlled (1st percentile).

The EPA has proposed to adopt the first interpretation and has

solicited comment in other rulemakings on its interpretation of ``the

average emission limitation achieved by the best performing 12 percent

of existing sources'' (section 112(d)(3)(A) of the Act). The guidance

document, MACT Determinations under Section 112(j) (EPA-450/3-92-007a),

explains how a MACT floor might be determined using EPA's proposed

interpretation. Should the EPA adopt a different methodology for

determining the MACT floor, the guidance document will be amended to

explain this approach.

The MACT floor for existing sources also takes into account sources

achieving the ``lowest achievable emission rate'' (LAER) as defined for

the criteria pollutant new source review program under section 171 of

the Act, and excludes these limitations from the floor calculation for

sources who have achieved LAER within 18 months before proposal or

within 30 months before promulgation of a standard. The EPA interprets

the ``best performing 12 percent'' to mean the best performing 12

percent of sources in the United States, because all sources in each

category are in the United States. The phrase ``in the United States''

is added to the existing source MACT floor definition in order to

clarify that territories and possessions of the United States are

included.

When a MACT floor has been determined by EPA or the permitting

authority, the rule requires that the MACT emission limitation achieve

an equal or greater level of control than that MACT floor. In

determining whether to require a MACT emission limitation that achieves

a level of control greater than the MACT floor, the permitting

authority should consider the costs, non-air quality health and

environmental impacts and energy requirements of achieving that level

of control. (See section 112(d)(2) of the Act).

For new emission units, the MACT floor for a case-by-case MACT

determination, consistent with section 112(d), is the level of control

that is achieved in practice by the best controlled similar source. The

EPA believes that the legislative history of section 112 suggests that

the ``best controlled similar source'' could be located outside of the

United States. See, Statement of Senator Durenberger, Cong. Rec. S.

17239 (October 26, 1990). The definition of MACT floor for new source

MACT is therefore not restricted to sources in the United States, but

could instead be based on a technology known to be used in practice on

a similar source located anywhere.

The Act states that ``the maximum degree of reduction that is

deemed achievable for new sources in a category or subcategory shall

not be less stringent than the emission control that is achieved in

practice by the best controlled similar source, as defined by the

Administrator.'' The Act does not specifically define the term ``best

controlled similar source.'' In addition, unlike for existing sources

for which the Act states, `` the average emission limitation achieved

by the best performing 12 percent of the existing sources * * * in the

category or subcategory for categories or subcategories with 30 or more

sources,'' the Act does not specifically indicate that the

determination of the best controlled similar source should be limited

to sources within that same source category. The guidance document

``MACT Determinations under Section 112(j)'' provides a detailed

discussion of the criteria that should be used to determine if a source

is ``similar.''

The EPA believes that because the Act specifically indicates that

existing source MACT should be determined from within the source

category, and does not make this distinction for new source MACT, that

Congress intends for transfer technologies to be considered when

establishing the minimum criteria for new sources. The EPA also

believes that the use of the word ``similar'' provides additional

support for this interpretation. The EPA believes that Congress could

have explicitly restricted the minimum level of control for new

sources, but did not. The use of the term ``best controlled similar

source'' rather than ``best controlled source within the source

category'' suggests that the intent is to require a consideration of

transfer technologies when appropriate.

The EPA believes that there will be cases when such technology

transfers are entirely reasonable. For example, suppose that the best

controlled tank within a source category did not have state-of-the-art

controls. Yet, tanks from outside the source category storing similar

organic liquids use state-of-the-art controls vented to an emission

control device. The EPA believes that such tanks are clearly

``similar'' within the language of section 112(d). The EPA also

believes that the Act does not compel all such technology transfers in

all cases, and that emission types and the ability to install such

controls are strong factors in determining when sources should be

considered similar. For example, within source category X, spray booths

tend to be uncontrolled due to gas streams with low concentrations and

relatively high airflows. The EPA does not believe that controls from

another category should be considered in determining the best

controlled similar source when emissions from that category's spray

booths are of high concentration and low airflow. The emissions from

these sources are clearly not similar. However, if it is

technologically feasible, these same controls could be considered in

establishing the new source level of control if consideration is given

to cost, non-air quality health and environmental impacts and energy

requirements.

Subcategorization

When the notice of initial list of categories of sources under

section 112(c)(1) of the Act was published in the Federal Register (57

FR 31579), the EPA listed broad categories of major and area sources

rather than narrowly defined categories. The EPA chose to establish

broad source categories at the time the source category list was

developed because there was too little information to anticipate

specific groupings of similar sources that are appropriate for defining

MACT floors for the purposes of establishing emission standards. During

the standard setting process, the EPA may find it appropriate to

further divide categories to distinguish among classes, types and sizes

of sources, as the Act provides.

The lack of subcategorization and broad nature of the source

category may pose some difficulty in establishing a case-by-case

emission limitation. The source category list contains categories that

will regulate more than one process type. It may be appropriate to

consider all process and emission units as one source when determining

the MACT floor level of control; or, after gathering information on the

source category, the EPA may find that, where there are basic

technological differences between different types of processes or

emission units, grouping all units into one source category is

inappropriate and a more accurate and realistic MACT floor finding can

be made by subcategorizing the industry. Criteria to consider include

air pollution control differences, process operation (including

differences between batch and continuous operation), emission

characteristics, control device applicability and costs, safety, and

opportunities for pollution prevention.

Several commenters encouraged EPA to further subcategorize the

source category list for the purposes of case-by-case MACT

determinations. While this option may provide for the greatest

consistency in MACT determinations from all permitting authorities, the

feasibility of this option is questionable. The EPA did not

subcategorize source categories because there was insufficient

information to properly characterize each source category at the time

the source category list was developed under section 112(c)(1).

Although additional information may be collected for a given category

before the section 112(j) deadline, such information may not always be

sufficient to support subcategorization.

Information burden/MACT floor finding. A significant issue for this

rulemaking is how to avoid placing unmanageable information-gathering

burdens on sources and permitting authorities while ensuring that

emissions limitations under section 112(j) are equivalent to standards

that the EPA would have issued. Commenters raised a variety of concerns

about the resource burden, legality, and sensibility of requiring each

individual source to provide its own MACT floor determination in its

permit application.

Because all section 112(j) MACT determinations occur for a

particular source category within a limited time frame, the EPA agrees

that it would be duplicative and burdensome for each individual source

to initiate a MACT floor finding, and that it would be more efficient

and consistent for EPA or permitting agencies to determine the MACT

floor.

In addition, consistent MACT determinations across sources are in

the interests of both sources and permitting agencies. MACT

determinations would be more likely to be at least as stringent as the

eventual section 112(d) standard if either EPA or the permitting

agency, as opposed to each individual source, provided the initial

floor analysis. If the MACT floor is not determined consistently under

section 112(j), then chances increase that some sources would install

controls under section 112(j) that do not achieve an emission

limitation equivalent to eventual section 112(d) requirements. These

sources would then be required later to retrofit the emission unit with

different controls when the section 112(d) MACT standard is eventually

promulgated (once the compliance extension provided for in Sec. 63.56

has expired).

If section 112(j) requirements are triggered, the EPA anticipates

that a substantial amount of information on the source category will

have been collected, allowing EPA to conduct a MACT floor analysis.

When it appears that the section 112(j) requirements will take effect,

the EPA intends to make the findings of this analysis available to the

public. For example, the floor determination may be readily available

in EPA-developed Background Information Document (BID). The EPA

believes that for such cases it would be reasonable to expect that such

a BID would be taken into consideration in establishing a case-by-case

MACT emission limitation. Regardless of the format in which the MACT

floor finding is presented, the EPA expects that its finding would

include the EPA's view of the definition of source or emission unit, as

well as a delineation of applicable subcategories. However, nothing in

today's rule should be read to diminish the discretion of the

permitting authority to use its own floor finding, if the permitting

authority can present evidence for a MACT floor finding different from

that which the EPA has determined. Such evidence could be, for example,

data provided by affected owners or operators that supports a

correction to the EPA's MACT floor finding.

Although the EPA believes that it holds the greatest responsibility

for making MACT floor findings and MACT determinations available in

cases where the requirements of section 112(j) are triggered, the EPA

must still provide for those instances in which a MACT floor

determination will not be available at the time of the section 112(j)

deadline. The EPA agrees with commenters who argue, as outlined above,

that in such cases the burden for making MACT floor findings should

rest with the permitting agency, not the individual applicant. (In such

cases, the EPA may still have collected a great deal of information on

the industry, which the EPA anticipates sharing with permitting

agencies).

Section 63.55(a)(3) provides that if neither the EPA nor the

permitting authority makes a MACT floor finding by the section 112(j)

deadline, then the source shall submit a permit application, by the

section 112(j) deadline, that will be considered complete if it

contains all relevant information on emissions and controls (as set out

in Sec. 63.53(b)(1)..(9)), but no MACT floor finding or MACT

determination. Section 63.55(a)(3)(i) adds that the source may choose

to include a recommended MACT determination in its permit application.

Section 63.55(b) provides that the source's final permit must

contain a MACT determination which, based on information ``available to

or generated by'' the permitting authority, is at least as stringent as

the MACT floor. In cases where a floor has not been established by the

section 112(j) deadline by the EPA, the EPA believes that the data

collected in the permit application process, in combination with

information already collected by the EPA, can be used to establish

minimum requirements for permits. The EPA envisions that permitting

agencies can share information received in these applications, and that

such information will be reported to EPA's national database. In

addition, information generated by industry trade groups and the public

may be of assistance.

The proposed rule contained a requirement for permitting

authorities to submit copies to the Administrator of all Notice of MACT

Approvals or Title V permits within 60 days of issuance. The EPA

received many comments affirming the need for a mandatory reporting

requirement to a National database. Commenters believe this is

necessary to assure that the information used to determine the MACT

floor is representative of the full range and frequency of controls

achieved by sources in the category or subcategory. The EPA agrees that

information should be submitted to the Administrator to facilitate

information exchange between the permitting agencies making section

112(j) MACT determinations. However, the EPA believes that this

information would be most useful if received before issuance of the

permit or Notice of MACT Approval. Therefore, Sec. 6.55(c) has been

changed to require owners or operator to provide, to the Administrator,

an additional copy of any Notice of MACT Approval or title V permit

submitted to a permitting authority to comply with the requirements of

this rule.

The EPA considered requiring that, in each permit application, the

owner or operator would make a control technology recommendation

evaluating the impacts of alternative control levels and evaluating

whether, in its judgement, the recommended control technology achieves

emission reductions equal to or greater than the MACT floor. The EPA is

concerned that, while such a requirement would satisfy the requirements

of the Act, it may be overly burdensome to require each affected owner

to prepare a separate analysis of costs, environmental impacts, etc.,

needed for such a recommendation.

In today's rule, owners and operators are strongly encouraged to

provide such recommendations at the time of the application, but are

not required to do so. At a minimum, however, the owner or operator is

required to submit information on HAP emissions and current controls

for each emission point, as well as any additional information deemed

necessary by the permitting authority to evaluate control alternatives.

The EPA wishes to clarify that the requirements in Sec. 63.53

(b)(8) and (b)(9) to list emission rates is intended as background

information to enable the permitting authority to identify the

pollutants requiring MACT controls. The EPA recognizes that there is

often a significant effort required to obtain precise estimates of HAP

emission rates and speciation. The EPA does not intend in this

paragraph to require a greater level of detail than is necessary for

evaluating applicability and emission control issues.

The EPA envisions, in cases where a MACT determination has not been

provided by the Administrator, that a multi-stage process will be

involved before issuance of the final title V permit. For the first

stage, affected owners and operators would submit an initial

application identifying the current level of control and data pertinent

to the evaluation of control alternatives. Permitting authorities would

review the application and provide the owner or operator with feedback

on any additional information required. The owner or operator would be

required to supply complete information no later than 6 months from the

date of the initial application. For the second stage, the permitting

authority would, in tandem with other permitting authorities, determine

an emission limitation for each application that represents a MACT

emission limitation for each emission unit. In the last stage, the

emission limitation would be formally incorporated into the permit

through the normal title V processes (public review, etc.)

G. Section 63.56--Requirements After Promulgation of a Subsequent

Standard Under Section 112(d).

Section 63.56 of today's rule sets out requirements for

incorporating subsequent standards into an operating permit after the

owner or operator has submitted a permit application for a section

112(j) case-by-case MACT determination, or after a case-by-case MACT

determination has been made under section 112(j). Section 63.56

implements the specific requirements of subsection 112(j)(6) of the

Act.

Section 63.56 provides, as required in the Act, that if the EPA

promulgates a section 112(d) standard for a source category before

approval of a section 112(j) permit application for a source in that

source category, then the permit must reflect the section 112(d)

standard. New sources must comply upon startup with the section 112(d)

rule except that, if the MACT standard is more stringent than the

proposal, sources commencing construction or reconstruction between

proposal and promulgation may comply with the proposal for 3 years,

then meet the final MACT standard.

If EPA promulgates a section 112(d) standard after issuance of a

section 112(j) permit for a source in the relevant source category,

then the permit must be revised upon renewal to reflect the section

112(d) standard. However, the compliance period must be no longer than

a total of 8 years from the initial section 112(j) compliance date, or

the section 112(d) promulgation date, whichever is earlier.

Paragraph 63.56(c) clarifies a permitting authority's

responsibilities when a case-by-case MACT standard is more stringent

than a subsequent section 112(d) standard, and a permit containing that

case-by-case standard has been issued. In that instance, the permitting

authority is not required to revise the permit to reflect the less

stringent section 112(d) standard, but may presume that the more

stringent case-by-case determination satisfies the requirements of both

section 112(j) and section 112(d). The EPA believes that nothing in

section 112 of the Clean Air Act requires pre-emption of these more

stringent State standards. The initial responsibility for determining

whether a case-by-case MACT determination is more stringent rests with

the permitting authority. The permitting authority should expect that

EPA, in reviewing the permit at permit renewal, would look to the

criteria in subpart E for guidance in approving this determination.

IV. Discussion of the Relationship of Today's Rule to Other

Requirements of the Act

A. Section 112(g) Requirements for Constructed, Reconstructed, and

Modified Major Sources; and Subsequent Standards Under Section 112(d)

or Section 112(h)

States and sources implementing the requirements of section 112 of

the Clean Air Act need to understand the potentially complex

relationships among several interlocking provisions. At proposal the

EPA requested comment on different interpretations of the relationship

among the requirements of sections 112 (d), (g) and (j).

Internal Consistency

As discussed in section II.C. of this preamble, EPA's primary goal

is to create as much consistency as possible between case-by-case MACT

determinations under section 112(j) and implementation of subsequent

section 112(d) standards for those same source categories. In addition,

the Agency desires to rationalize the section 112(j) provisions with

the section 112(g) provisions requiring case-by-case MACT

determinations for constructed, reconstructed, and modified major

sources. While some of the specific substantive requirements of section

112(g) differ from the substantive requirements of section 112(j) and

section 112(d), the EPA intends to ensure the greatest possible

consistency among sections 112 (d), (g), and (j) provisions. This

discussion outlines EPA's preferred approach in implementing section

112(g) and achieving a consistent relationship across sections 112(d),

112(g), and 112(j). EPA recently proposed a rule implementing section

112(g) and a final determination on the relationship between these

provisions will be made in that rulemaking.

One fundamental principal guiding the design of regulations under

all three provisions is that case-by-case maximum achievable control

technology requirements under section 112(g) are applicable only until

the effective date of a section 112(j) or section 112(d) standard for a

source category. After the effective date of a section 112(j) or a

section 112(d) MACT standard, any more stringent emission limitations

required under section 112(j) or section 112(d) supersede the specific

emission limitations required under section 112(g).

The EPA considered an alternative approach, i.e. the finding that

section 112(g) governs all changes and additions of new emission units

at existing sources whether or not a section 112 (d) or (j) standard

exists. This issue generated numerous comments. Some commenters argue

that the requirements of section 112(g) should not be superseded when a

MACT emission limitation is established under either section 112(j) or

section 112(d) is promulgated. A few commenters argue that a control

technology selected for a particular standard under section 112 (j) or

(d) should not remain fixed, and that the way to continually require

better controls is through section 112(g). Others argue that because

section 112(j) does not contain the word ``modification'', that all

modifications should be handled by section 112(g).

Many argue that EPA's approach to coordinating sections section 112

(j), (d), and (g) would result in unnecessary regulatory burdens, such

as: (1) regulating sources that emit below ``de minimis'' amounts under

section 112(g) as new sources, (2) stifling technological advance and

delay needed process changes through over-regulation, and (3)

subjecting some sources to repeated MACT determinations, and perhaps

forcing sources to replace controls required under section 112(g) with

controls required under section 112(j).

Other commenters endorsed EPA's approach to coordinating section

112(j), (g), and (d), by asserting that since section 112(j) standards

will apply to an entire source category, it is important that they be

established according to a philosophy compatible with section 112(d).

The EPA recognizes that changes to a source subject to a section

112(d) MACT standard will be subject to the same control requirements

that already apply under section 112(d). The EPA believes that section

112(g) establishes case-by-case MACT to cover those major sources who

make modifications before a promulgated MACT standard applies.

Therefore consistency would suggest that similarly, changes to a source

subject to a case-by-case MACT standard under section 112(j)--which

acts in place of a section 112(d) standard--should be subject to the

same control requirements that already apply under section 112(j).

While under this approach section 112(g) continues to require

assessment of whether a modification has occurred after a section

112(d) or section 112(j) standard is in effect, it will not dictate the

level of control when the requirements of section 112(d) or section

112(j) are more stringent. The EPA believes that the internal

consistency of this approach would yield a more consistent application

of controls on major sources than would prolonging the use of case-by-

case MACT under section 112(g).

Moreover the EPA does not intend that case-by-case controls applied

under section 112(j) will result in subjecting sources to repeating and

conflicting MACT determinations. The EPA expects that case-by-case MACT

determinations under section 112(j) will require updates to those made

under section 112(g) only in rare cases.

A further reason for rejecting the approach that section 112(g)

control extends to sources covered by more stringent section 112(d) or

section 112(j) standards is that it leads to the conclusion that many

new sources within the section 112(a)(4) definition of new source would

forever escape having to apply a new source MACT level of control.

Section 112(a)(4) defines a new source as ``a stationary source the

construction or reconstruction of which is commenced after the

Administrator first proposes regulations under this section

establishing an emission standard applicable to such source.'' Thus,

once a standard has been set under section 112(d), any new source will

be subject to new source MACT. The MACT standard will define the

portion of a facility that is considered a ``source'' for the purposes

of the particular standard. Such source may be either an entire major

source, or one or more sources within the major source. (Of course a

MACT standard can also be set for area sources, which are stationary

sources that are not part of a major source; but as section 112(j) does

not apply to area sources, that is not relevant here).

Section 112 (g) applies to construction, reconstruction, or

modification of major sources, and in many cases will have an effect on

sources earlier than section 112 (d) or (j) standards. However, section

112 (g) only requires new source MACT on ``constructed'' major sources,

and considers any other new emission unit to be a modification of an

existing major source. As a ``modification,'' such a new emission unit

will be required to apply for existing source case-by-case MACT

determination under section 112(g). Therefore if section 112(g) were to

constrain the application of a subsequent section 112(j) or section

112(d) standard, many new emission units under the section 112(a)(4)

definition of ``new source'' would never be required to comply with new

source MACT.

In addition, under section 112(g) a new emission unit might not

even be required to meet an existing source MACT level of control.

Section 112(g) allows for modifications to either: (1) comply with a

case-by-case ``existing source'' MACT determination under section

112(g); (2) offset emissions increases in lieu of applying section

112(g) existing source MACT requirements; or (3) if its emissions were

below section 112(g) de minimis levels, not be subject to any control

requirements at all. The EPA believes that section 112(g) thus provides

major sources with a great deal of needed flexibility before sections

112 (d) or (j) standards are set; but that once those standards are in

place the Act intends that these sources must comply with the specific

control technology requirements of those standards instead of those of

section 112(g).

Finally, the interpretation that section 112(g) governs the control

requirements on new emission units at major sources to which section

112 (d) or (j) standards already apply would have some anomalous

implications. One example would be a new emission unit whose emissions

are below section 112(g) de minimis levels for a particular hazardous

air pollutant. If that emission unit were added to a major source, it

would be exempt from the requirements of section 112(g), but would be

required to apply new source MACT control under section 112(j).

However, if that emission unit were not below section 112(g) de minimis

levels, it would be required to comply with section 112(g). If section

112(g) requirements limit the application of section 112(j), then the

source would be required to apply existing source MACT. In this

instance, a smaller emission unit would be required to control more

stringently than a larger emission unit.

Another example of anomalies resulting from this reading of the

statute would be a section 112(d) standard that sets new source MACT

for new area sources in a source category. Under this reading, major

sources adding new sources could avoid new source MACT, but any new

area source would have to meet new source MACT. Again, a smaller unit

would be required to control more stringently than a larger emission

unit.

Several commenters argue that the requirements of section 112(j)

should only apply to new and existing major sources once, at the time

the hammer falls, and that subsequent construction of new major

sources, or additions to existing major sources should not be subject

to section 112(j) requirements. These commenters state that such

subsequent changes should be governed by section 112(g) requirements.

The EPA does not believe that section 112(j) is only applicable at

the time that the hammer falls. Section 112(j) is intended to take the

place of section 112(d) standards, and thus should apply to all sources

in the relevant category until the section 112(d) standard takes over.

Thus, a new source constructed after the hammer date, but before a MACT

standard is promulgated, should be subject to section 112(j) to the

same extent as a source that is covered by section 112(j) on the date

the hammer falls.

The EPA believes that under its preferred approach, the substantive

control requirements of section 112(g) would be pre-empted by the more

stringent requirements of a relevant section 112(j) or section 112(d)

standard. Relying on section 112(g) to cover new emission units after

the section 112(j) deadline is insufficient because it does not require

application of the equivalent of section 112(d) standards to all

sources in the relevant source category.

Similarly, some commenters argue that if a major source has

complied with section 112(g), it should have to do no more under

section 112(j). Under the EPA's preferred approach, in most cases

compliance with section 112(g) will be sufficient under section 112(j),

but there are some situations where section 112(j) may require more

control. For example, an existing major source that has been modified

and has met case-by-case MACT under section 112(g) may not have

installed MACT on all emission units in a given source category,

because some emission units may have offset out of control, and

emission units below section 112(g) de minimis emission rates will not

have applied control. Under the EPA's preferred approach, section

112(j) would require case-by-case MACT on all the emission units within

the major source that are included in the category for which the

section 112(j) deadline has passed. However in most cases where

existing source MACT controls have been applied under section 112(g),

those controls under section 112(g) will suffice for emission units

required to install existing source MACT under section 112(j). (There

may be rare cases where section 112(j) will require new source MACT on

some emission units that only have to meet existing source MACT under

section 112(g). For example, an emission unit constructed after

proposal of a section 112(d) MACT standard, but before the section

112(j) deadline, would have to meet existing source MACT under section

112(g) and later new source MACT under section 112(j). This distinction

will require more stringent control in cases where the permitting

authority finds new source MACT to be more stringent than existing

source MACT). Again, this discussion outlines the EPA's preferred

approach in implementing section 112(g) and achieving a consistent

relationship across sections 112(d), 112(g), and 112(j). The EPA

recently proposed a rule implementing section 112(g) and a final

determination on the relationship between these provisions will be made

in that rulemaking.

Administrative consistency. Voluntary administrative procedures for

new sources under section 112(j), as outlined in Sec. 63.54 of today's

rule, are intended to be analogous to administrative requirements that

will be established for modified, constructed, and reconstructed

sources under section 112(g) of the Act. These requirements were

proposed in Sec. 63.40 through 63.48 of this subpart, at 59 FR 15504

(April 1, 1994).

Figure 1 illustrates the link between the voluntary section 112(j)

preconstruction review process and the proposed section 112(g)

administrative requirements. Although the EPA believes that section

112(j) does not provide authority for an upfront review of all new

sources, the EPA believes, as a matter of policy, that whether

preconstruction or pre-operation review is done under the authority of

section 112(g) or section 112(j), the MACT determination can be

incorporated directly into the title V permit by administrative

amendment if the review process contains the elements necessary to make

it an ``enhanced'' process, as discussed in section III.C. of this

preamble.

Before the section 112(j) deadline, such sources will be required

to make a case-by-case MACT determination under section 112(g). After

the section 112(j) deadline, these sources will be required to make a

case-by-case MACT determination under section 112(j). Many of these

sources may still be subject to preconstruction or pre-operation review

under section 112(g). Sources applying for approval of a case-by-case

MACT determination under section 112(g), but who will be subject to

section 112(j) new source MACT, need to know this before they

construct, in order to install the right equipment.

In addition there will be new sources that may not be covered by

section 112(g), but who may be required to install new source MACT

under section 112(j). For example, an owner/operator may intend to make

an offset showing that would avoid a case-by-case MACT determination

under section 112(g). Or a new unit's emissions may fall below a

section 112(g) de minimis level for a specific pollutant. In both of

these cases, the owner or operator should know in advance of the

section 112(j) deadline that they may be required to install new source

MACT under section 112(j).

Therefore, any owner or operator planning to construct a new major

source, or any existing major source planning to install a new emission

unit after a scheduled promulgation date for a source category, is

encouraged to undergo ``enhanced'' preconstruction or pre-operation

review under section 112(j). This is the only way to satisfy the

requirements of title V to allow incorporation of section 112(j) MACT

emission limits in the operating permit by administrative amendment.

B. Section 112(l) Delegation Process

Under section 112(l) of the Act, States have the option of

developing and submitting to the Administrator a program for

implementing the requirements of section 112, including section 112(j).

The EPA rule implementing section 112(l) is contained in Sec. 63.90

through Sec. 63.96 of 40 CFR part 63.

The EPA believes that section 112(l) approvals do not have a great

deal of overlap with the section 112(j) provision, because section

112(j) is designed to use the title V permit process as the primary

vehicle for establishing requirements. There may be, however, some

instances where section 112(l) approvals could streamline the process.

For example, a State may have an existing rule for a source category

for which it could be demonstrated that all sources are achieving a

level of control no less stringent than required under the case-by-case

MACT requirements of section 112(j). The EPA believes that there may be

advantages in obtaining approval under subpart E for such instances.

C. Section 112(i)(5) Early Reductions Program

Section 112(i)(5) of the Act allows EPA to grant a source a 6 year

compliance extension from a section 112(d) MACT standard if the source

achieves ``early reductions'' of its emissions. An early reduction is

defined as a 90 percent reduction in a source's hazardous air pollutant

emissions (95 percent reduction in a source's particulate emissions)

before the relevant MACT standard is proposed. The source's commitment

to achieve early reductions must be federally enforceable, must be

included in the title V permit, and must be submitted to EPA within 120

days of establishment of a title V permit program, or, if later, before

the relevant section 112(d) standard for that source category is

proposed. These commitments to reduce emissions early become classified

as alternative emission limitations throughout the 6 year extension

period. Alternative emission limitations are the ``applicable emission

requirements'' for the early reduction source.

However, Sec. 63.52(c) provides that an alternative emission

limitation established for the purpose of early reduction credit can be

included as a MACT emission limitation in the permit, so long as the

reduction was achieved by the date established in the source category

schedule for standards. This requirement is established pursuant to the

specific provisions of section 112(j)(5).

V. Administrative Requirements

A. Docket

The docket for this regulatory action is A-93-32. The docket is an

organized and complete file of all the information submitted to, or

otherwise considered by, EPA in the development of this rulemaking. The

principal purposes of the docket are:

(1) To allow interested parties a means to identify and locate

documents so that they can effectively participate in the rulemaking

process, and

(2) To serve as the record in case of judicial review. The docket

is available for public inspection at the EPA's Air Docket, which is

listed under the ADDRESSES section of this document.

B. Executive Order 12866

Under Executive Order 12866 (58 FR 51735, 10/04/94), the Agency

must determine whether the regulatory action is ``significant'' and

therefore subject to OMB review and the requirements of the Executive

Order. The Order defines ``significant'' regulatory action as one that

is likely to lead to a rule that may:

(1) Have an annual effect on the economy of $100 million or more,

or adversely and materially affect a sector of the economy,

productivity, competition, jobs, the environment, public health or

safety, or State, local or tribal governments or communities;

(2) Create a serous inconsistency or otherwise interfere with an

action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants,

user fees, or loan programs or the rights and obligation of recipients

thereof;

(4) Raise novel legal or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order.

Pursuant to the terms of Executive Order 12866, the EPA has

determined that this action is a ``significant regulatory action''

within the meaning of the Executive Order, because it may materially

affect the environment, public health, and State and local governments.

For this reason, this action was submitted to the OMB for review.

Changes made in response to the OMB's suggestions or recommendations

will be documented in the public record.

Any written comments from OMB to the EPA and any written EPA

response to any of those comments will be included in the docket listed

at the beginning of today's notice under ADDRESSES. The docket is

available for public inspection at the EPA Air Docket Section, (LE-

131), ATTN: Docket No. A-93-32, U.S. Environmental Protection Agency,

401 M St., SW., Washington, DC 20460.

C. Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601 et. seq.) requires the

EPA to consider potential impacts of proposed regulations on small

entities. If a preliminary analysis indicates that a proposed

regulation would have a significant economic impact on 20 percent or

more of small entities, then a regulatory flexibility analysis must be

prepared.

Present Regulatory Flexibility Act guidelines indicate that an

economic impact should be considered significant if it meets one of the

following criteria: (1) Compliance increases annual production costs by

more than 5 percent, assuming costs are passed on to consumers; (2)

compliance costs as a percentage of sales for small entities are at

least 10 percent more than compliance costs as a percentage of sales

for large entities; (3) capital costs of compliance represent a

``significant'' portion of capital available to small entities,

considering internal cash flow plus external financial capabilities; or

(4) regulatory requirements are likely to result in closures of small

entities.

This regulation does not affect a significant number of small

businesses, small governmental jurisdictions, or small institutions,

because this regulation only affects major sources of hazardous air

pollutants. Pursuant to the provisions of 5 U.S.C. 605(b), I hereby

certify that today's rule will not have a significant economic impact

on a substantial number of small entities.

D. Paperwork Reduction Act

The information collection requirements in this rule have been

approved by the Office of Management and Budget (OMB) under the

Paperwork Reduction Act, 44 U.S.C. 3501 et seq., and has been assigned

the OMB control no. 2060-0266. An Information Collection Request (ICR)

document has been prepared by the EPA (ICR No. 1648.01), and a copy may

be obtained from Sandy Farmer, Information Policy Branch (PM-2136),

U.S. Environmental Protection Agency, 401 M Street SW., Washington, DC

20460, or by calling (202) 260-2740.

This collection of information is estimated to have an average

annual public reporting burden of approximately 200 hours per

respondent. This includes time for reviewing instructions, searching

existing data sources, gathering and maintaining the data needed, and

completing and reviewing the collection of information.

Send comments regarding the burden estimate or any other aspect of

this collection of information, including suggestions for reducing this

burden to Chief, Information Policy Branch (PM-2136), U.S.

Environmental Protection Agency, 401 M Street SW., Washington, DC

20460; and to the Office of Information and Regulatory Affairs, Office

of Management and Budget, Washington, DC 20503, marked ``Attention:

Desk Officer for EPA.''

List of Subjects

40 CFR Part 9

Reporting and recordkeeping requirements.

40 CFR Part 63

Environmental protection, Administrative practices and procedures,

Air pollution control, Hazardous substances, Intergovernmental

relations, Reporting and recordkeeping requirements.

Dated: April 29, 1994.

Carol M. Browner,

Administrator.

For the reasons set out in the preamble, title 40, chapter I, of

the Code of Federal Regulations is amended as follows:

PART 9--[AMENDED]

1. The authority citation for part 9 continues to read as follows:

Authority: 7 U.S.C. 135 et seq., 136-136y; 15 U.S.C. 2001, 2003,

2005, 2006, 2601-2671; 21 U.S.C. 331j, 346a, 348; 31 U.S.C. 9701; 33

U.S.C. 1251 et seq., 1311, 1313d, 1314, 1321, 1326, 1330, 1344, 1345

(d) and (e), 1361; E.O. 11735, 38 FR 21243, 3 CFR, 1971-1975 Comp.

p. 973; 42 U.S.C. 241, 242b, 243, 246, 300f, 300g, 300g-1, 300g-2,

300g-3, 300g-4, 300g-5, 300g-6, 300j-1, 300j-2, 300j-3, 300j-4,

300j-9, 1857 et seq., 6901-6992k, 7401-7671q, 7542, 9601-9657,

11023, 11048.

2. Section 9.1 is amended by adding a new entry to the table under

the indicated heading to read as follows:

Sec. 9.1 OMB approvals under the Paperwork Reduction Act.

* * * * *

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

40 CFR citation OMB control No.

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*****

National Emission Standards for Hazardous Air

Pollutants for Source Categories:

63.52-63.56....................................... 2060-0266

*****

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

PART 63--[AMENDED]

1. The authority citation for part 63 continues to read as follows:

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

2. Part 63 is amended by adding a new subpart B, consisting of

Secs. 63.40 through 63.56 to read as follows:

Subpart B--Requirements for Control Technology Determinations for Major

Sources in Accordance With Clean Air Act Sections, Sections 112(g) and

112(j)

Sec.

63.40-63.49 [Reserved]

63.50 Applicability.

63.51 Definitions.

63.52 Approval process for new and existing emission units.

63.53 Application content for case-by-case MACT determinations.

63.54 Preconstruction review procedures for new emission units.

63.55 Maximum achievable control technology (MACT) determinations

for emission units subject to case-by-case determination of

equivalent emission limitations.

63.56 Requirements for case-by-case determination of equivalent

emission limitations after promulgation of a subsequent MACT

standard.

Subpart B--Requirements for Control Technology Determinations for

Major Sources in Accordance With Clean Air Act Sections, Sections

112(g) and 112(j)

Secs. 63.40-63.49 [Reserved]

Sec. 63.50 Applicability.

(a) General applicability. The requirements of Secs. 63.50 through

63.56 implement section 112(j) of the Clean Air Act (as amended in

1990). The requirements of Secs. 63.50 through 63.56 apply in each

State beginning on the effective date of an approved title V permit

program in such State. These requirements apply to the owner or

operator of a major source of hazardous air pollutants which includes

one or more stationary sources included in a source category or

subcategory for which the Administrator has failed to promulgate an

emission standard under this part by the section 112(j) deadline.

(b) Relationship to State and local requirements. Nothing in

Secs. 63.50 through 63.56 shall prevent a State or local regulatory

agency from imposing more stringent requirements than those contained

in these subsections.

(c) Retention of State permit program approval. In order to retain

State permit program approval, a State must, by the section 112(j)

deadline for a source category, obtain sufficient legal authority to

establish equivalent emission limitations, to incorporate those

requirements into a title V permit, and to incorporate and enforce

other requirements of section 112(j).

Sec. 63.51 Definitions.

Terms used in Secs. 63.50 through 63.56 of this subpart that are

not defined below have the meaning given to them in the Act, in subpart

A of this part.

Available information means, for purposes of conducting a MACT

floor finding and identifying control technology options for emission

units subject to the provisions of this subpart, information contained

in the following information sources as of the section 112(j) deadline:

(1) A relevant proposed regulation, including all supporting

information;

(2) Background information documents for a draft or proposed

regulation;

(3) Any regulation, information or guidance collected by the

Administrator establishing a MACT floor finding

and/or MACT determination;

(4) Data and information available from the Control Technology

Center developed pursuant to section 112(l)(3) of the Act, and

(5) Data and information contained in the Aerometric Informational

Retrieval System (AIRS) including information in the MACT database, and

(6) Any additional information that can be expeditiously provided

by the Administrator, and

(7) Any information provided by applicants in an application for a

permit, permit modification, administrative amendment, or Notice of

MACT Approval pursuant to the requirements of this subpart.

(8) Any additional relevant information provided by the applicant.

Control technology means measures, processes, methods, systems, or

techniques to limit the emission of hazardous air pollutants including,

but not limited to, measures which:

(1) Reduce the quantity, or eliminate emissions, of such pollutants

through process changes, substitution of materials or other

modifications;

(2) Enclose systems or processes to eliminate emissions;

(3) Collect, capture, or treat such pollutants when released from a

process, stack, storage or fugitive emissions point;

(4) Are design, equipment, work practice, or operational standards

(including requirements for operator training or certification) as

provided in 42 USC 7412(h); or

(5) Are a combination of paragraphs (1) through (4) of this

definition.

Emission point means any part or activity of a major source that

emits or has the potential to emit, under current operational design,

any hazardous air pollutant.

Emission unit means any building, structure, facility, or

installation. This could include an emission point or collection of

emission points, within a major source, which the permitting authority

determines is the appropriate entity for making a MACT determination

under section 112(j), i.e., any of the following:

(1) An emission point that can be individually controlled.

(2) The smallest grouping of emission points, that, when collected

together, can be commonly controlled by a single control device or work

practice.

(3) Any grouping of emission points, that, when collected together,

can be commonly controlled by a single control device or work practice.

(4) A grouping of emission points that are functionally related.

Equipment is functionally related if the operation or action for which

the equipment was specifically designed could not occur without being

connected with or without relying on the operation of another piece of

equipment.

(5) The entire geographical entity comprising a major source in a

source category subject to a MACT determination under section 112(j).

Enhanced review means a review process containing all

administrative steps needed to ensure that the terms and conditions

resulting from the review process can be incorporated into the title V

permit by an administrative amendment.

Equivalent emission limitation means an emission limitation,

established under section 112(j) of the Act, which is at least as

stringent as the MACT standard that EPA would have promulgated under

section 112(d) or section 112(h) of the Act.

Existing major source means a major source, construction or

reconstruction of which is commenced before EPA proposed a standard,

applicable to the major source, under section 112 (d) or (h), or if no

proposal was published, then on or before the section 112(j) deadline.

Maximum achievable control technology (MACT) emission limitation

for existing sources means the emission limitation reflecting the

maximum degree of reduction in emissions of hazardous air pollutants

(including a prohibition on such emissions, where achievable) that the

Administrator, taking into consideration the cost of achieving such

emission reductions, and any non-air quality health and environmental

impacts and energy requirements, determines is achievable by sources in

the category or subcategory to which such emission standard applies.

This limitation shall not be less stringent than the MACT floor.

Maximum achievable control technology (MACT) emission limitation

for new sources means the emission limitation which is not less

stringent than the emission limitation achieved in practice by the best

controlled similar source, and which reflects the maximum degree of

reduction in emissions of hazardous air pollutants (including a

prohibition on such emissions, where achievable) that the

Administrator, taking into consideration the cost of achieving such

emission reduction, and any non-air quality health and environmental

impacts and energy requirements, determines is achievable by sources in

the category or subcategory to which such emission standard applies.

Maximum Achievable Control Technology (MACT) floor means:

(1) For existing sources:

(i) The average emission limitation achieved by the best performing

12 percent of the existing sources in the United States (for which the

Administrator has emissions information), excluding those sources that

have, within 18 months before the emission standard is proposed or

within 30 months before such standard is promulgated, whichever is

later, first achieved a level of emission rate or emission reduction

which complies, or would comply if the source is not subject to such

standard, with the lowest achievable emission rate (as defined in

section 171 of the Act) applicable to the source category and

prevailing at the time, in the category or subcategory, for categories

and subcategories of stationary sources with 30 or more sources; or

(ii) The average emission limitation achieved by the best

performing five sources in the United States (for which the

Administrator has or could reasonably obtain emissions information) in

the category or subcategory, for a category or subcategory of

stationary sources with fewer than 30 sources;

(2) For new sources, the emission limitation achieved in practice

by the best controlled similar source.

New emission unit means an emission unit for which construction or

reconstruction is commenced after the section 112(j) deadline, or after

proposal of a relevant standard under section 112(d) or section 112(h)

of the Clean Air Act (as amended in 1990), whichever comes first,

except that, as provided by Sec. 63.52(f)(1), an emission unit, at a

major source, for which construction or reconstruction is commenced

before the date upon which the area source becomes a major source,

shall not be considered a new emission unit if, after the addition of

such emission unit, the source is still an area source.

New major source means a major source for which construction or

reconstruction is commenced after the section 112(j) deadline, or after

proposal of a relevant standard under section 112(d) or section 112(h)

of the Clean Air Act (as amended in 1990), whichever comes first.

Permitting authority means the permitting authority as defined in

part 70 of this chapter.

Section 112(j) deadline means the date 18 months after the date for

which a relevant standard is scheduled to be promulgated under this

part. The applicable date for categories of major sources is contained

in the source category schedule for standards.

Similar source means an emission unit that has comparable emissions

and is structurally similar in design and capacity to other emission

units such that the emission units could be controlled using the same

control technology.

Source category schedule for standards means the schedule for

promulgating MACT standards issued pursuant to section 112(e) of the

Act.

United States means the United States, its possessions and

territories.

Sec. 63.52 Approval process for new and existing emission units.

(a) Application. (1) Except as provided in Sec. 63.52(a)(3), if the

Administrator fails to promulgate an emission standard under this part

on or before an applicable section 112(j) deadline for a source

category or subcategory, the owner or operator of an existing major

source that includes one or more stationary sources in such category or

subcategory, shall submit an application for a title V permit or

application for a significant permit modification, whichever is

applicable, by the section 112(j) deadline.

(2) If the Administrator fails to promulgate an emission standard

under this part on or before an applicable section 112(j) deadline for

a source category or subcategory, the owner or operator of a new

emission unit in such source category or subcategory shall submit an

application for a title V permit or application for a significant

permit modification or administrative amendment, whichever is

applicable, in accordance with procedures established under title V.

(3) (i) The owner or operator of an existing major source that

already has a title V permit requiring compliance with a limit that

would meet the requirements of section 112(j) of the Act, shall submit

an application for an administrative permit amendment, by the section

112(j) deadline, in accordance with procedures established under title

V.

(ii) The owner or operator of a new emission unit that currently

complies with a federally enforceable alternative emission limitation,

or has a title V permit that already contains emission limitations

substantively meeting the requirements of section 112(j), shall submit

an application for an administrative permit amendment confirming

compliance with the requirements of section 112(j), in accordance with

procedures established under title V, and not later than the date 30

days after the date construction or reconstruction is commenced.

(4) In addition to meeting the requirements of Sec. 63.52(a)(2),

the owner or operator of a new emission unit may submit an application

for a Notice of MACT Approval before construction, pursuant to

Sec. 63.54.

(b) Permit review. (1) Permit applications submitted under this

paragraph will be reviewed and approved or disapproved according to

procedures established under title V, and any other regulations

approved under title V in the jurisdiction in which the emission unit

is located. In the event that the permitting authority disapproves a

permit application submitted under this paragraph or determines that

the application is incomplete, the owner or operator shall revise and

resubmit the application to meet the objections of the permitting

authority not later than six months after first being notified that the

application was disapproved or is incomplete.

(2) If the owner or operator has submitted a timely and complete

application for a title V permit, significant permit modification, or

administrative amendment required by this paragraph, any failure to

have this permit will not be a violation of the requirements of this

paragraph, unless the delay in final action is due to the failure of

the applicant to submit, in a timely manner, information required or

requested to process the application.

(c) Emission limitation. The permit or Notice of MACT Approval,

whichever is applicable, shall contain an equivalent emission

limitation (or limitations) for that category or subcategory determined

on a case-by-case basis by the permitting authority, or, if the

applicable criteria in subpart D of this part are met, the permit or

Notice of MACT Approval may contain an alternative emission limitation.

For the purposes of the preceding sentence, early reductions made

pursuant to section 112(i)(5)(A) of the Act shall be achieved not later

than the date on which the relevant standard should have been

promulgated according to the source category schedule for standards.

(1) The permit or Notice will contain an emission standard or

emission limitation to control the emissions of hazardous air

pollutants. The MACT emission limitation will be determined by the

permitting authority and will be based on the degree of emission

reductions that can be achieved, if the control technologies or work

practices are installed, maintained, and operated properly. Such

emission limitation will be established consistent with the principles

contained in Sec. 63.55.

(2) The permit or Notice will specify any notification, operation

and maintenance, performance testing, monitoring, reporting and

recordkeeping requirements. The permit or Notice will include the

following information:

(i) In addition to the MACT emission limitation required by

paragraph (c)(1) of this section, additional emission limits,

production limits, operational limits or other terms and conditions

necessary to ensure federal enforceability of the MACT emission

limitation;

(ii) Compliance certifications, testing, monitoring, reporting and

recordkeeping requirements that are consistent with requirements

established pursuant to title V, Sec. 63.52(e), and, at the discretion

of the permitting authority, to subpart A of this part;

(iii) A statement requiring the owner or operator to comply with

all requirements contained in subpart A of this part deemed by the

permitting authority to be applicable;

(iv) A compliance date(s) by which the owner or operator shall be

in compliance with the MACT emission limitation, and all other

applicable terms and conditions of the Notice.

(d)(1) Compliance date. The owner or operator of an existing major

source subject to the requirements of this paragraph shall comply with

the emission limitation(s) established in the source's title V permit.

In no case will such compliance date exceed 3 years after the issuance

of the permit for that source, except where the permitting authority

issues a permit that grants an additional year to comply in accordance

with section 112(i)(3)(B), or unless otherwise specified in section

112(i), or in subpart D of this part.

(2) The owner or operator of a new emission unit subject to the

requirements of this paragraph shall comply with a new source MACT

level of control immediately upon issuance of the title V permit for

the emission unit.

(e) Enhanced monitoring. In accordance with section 114(a)(3) of

the Act, monitoring shall be capable of detecting deviations from each

applicable emission limitation or other standard with sufficient

reliability and timeliness to determine continuous compliance over the

applicable reporting period. Such monitoring data may be used as a

basis for enforcing emission limitations established under this

subpart.

(f) Area sources that become major sources. (1) After the effective

date of this subpart, the owner or operator of a new or existing area

source that increases its emissions of, or its potential to emit,

hazardous air pollutants such that the source becomes a major source

that is subject to this subpart shall submit an application for a title

V permit or application for a significant permit modification, or

administrative amendment, whichever is applicable, by the date that

such source becomes a major source.

(i) If an existing area source becomes a major source by the

addition of an emission unit or as a result of reconstructing, that

added emission unit or reconstructed emission unit shall comply with

all requirements of this subpart that affect new emission units,

including the compliance date for new emission units established in

Sec. 63.52(d).

(ii) If an area source, constructed after the section 112(j)

deadline, becomes a major source solely by virtue of a relaxation in

any federally enforceable emission limitation, established after the

section 112(j) deadline, on the capacity of an emission unit or units

to emit a hazardous air pollutant, such as a restriction on hours of

operation, then that emission unit or units shall comply with all

requirements of this subpart that affect new emission units, on or

before the date of such relaxation.

(2) After the effective date of this subpart, if the Administrator

establishes a lesser quantity emission rate under section 112(a)(1) of

the Act that results in an area source becoming a major source, then

the owner or operator of such major source shall submit an application

for a title V permit or application for a significant permit

modification, or administrative amendment, whichever is applicable, on

or before the date 6 months from the date that such source becomes a

major source. If an existing area source becomes a major source as a

result of the Administrator establishing a lesser quantity emission

rate, then any emission unit, at that source, for which construction or

reconstruction is commenced before the date upon which the source

becomes major shall not be considered a new emission unit.

Sec. 63.53 Application content for case-by-case MACT determinations.

(a) MACT Demonstration. Except as provided by Sec. 63.55(a)(3), an

application for a MACT determination shall demonstrate how an emission

unit will obtain the degree of emission reduction that the

Administrator or the State has determined is at least as stringent as

the emission reduction that would have been obtained had the relevant

emission standard been promulgated according to the source category

schedule for standards for the source category of which the emission

unit is a member.

(b) MACT Application. The application for a MACT determination

shall contain the following information:

(1) The name and address (physical location) of the major source;

(2) A brief description of the major source, its source category or

categories, a description of the emission unit(s) requiring a MACT

determination pursuant to other requirements in this subpart, and a

description of whether the emission unit(s) require new source MACT or

existing source MACT based on the definitions established in

Sec. 63.51;

(3) For a new emission unit, the expected date of commencement of

construction;

(4) For a new emission unit, the expected date of completion of

construction;

(5) For a new emission unit, the anticipated date of startup of

operation;

(6) The hazardous air pollutants emitted by each emission point,

and an estimated emission rate for each hazardous air pollutant.

(7) Any existing federally enforceable emission limitations

applicable to the emission point.

(8) The maximum and expected utilization of capacity of each

emission point, and the associated uncontrolled emission rates for each

emission point;

(9) The controlled emissions for each emission point in tons/year

at expected and maximum utilization of capacity, and identification of

control technology in place;

(10) Except as provided in Sec. 63.55(a)(3), the MACT floor as

specified by the Administrator or the permitting authority.

(11) Except as provided in Sec. 63.55(a)(3), recommended emission

limitations for the emission unit(s), and supporting information,

consistent with Sec. 63.52(c) and Sec. 63.55(a).

(12) Except as provided in Sec. 63.55(a)(3), a description of the

control technologies that will apply to meet the emission limitations

including technical information on the design, operation, size,

estimated control efficiency, and any other information deemed

appropriate by the permitting authority, and identification of the

emission points to which the control technologies will be applied;

(13) Except as provided in Sec. 63.55(a)(3), parameters to be

monitored and frequency of monitoring to demonstrate continuous

compliance with the MACT emission limitation over the applicable

reporting period.

(14) Any other information required by the permitting authority

including, at the discretion of the permitting authority, information

required pursuant to subpart A of this part.

Sec. 63.54 Preconstruction review procedures for new emission units.

(a) Review process for new emission units. (1) If the permitting

authority requires an owner or operator to obtain or revise a title V

permit before construction of the new emission unit, or when the owner

or operator chooses to obtain or revise a title V permit before

construction, the owner or operator shall follow the administrative

procedures established under title V before construction of the new

emission unit.

(2) If an owner or operator is not required to obtain or revise a

title V permit before construction of the new emission unit (and has

not elected to do so), but the new emission unit is covered by any

preconstruction or pre-operation review requirements established

pursuant to section 112(g) of the Act, then the owner or operator shall

comply with those requirements, in order to ensure that the

requirements of section 112(j) and section 112(g) are satisfied. If the

new emission unit is not covered by section 112(g), the permitting

authority, in its discretion, may issue a Notice of MACT Approval, or

the equivalent, in accordance with the procedures set forth in

paragraphs (b) through (h) of this section, or an equivalent permit

review process, before construction or operation of the new emission

unit.

(3) Regardless of the review process, the MACT determination shall

be consistent with the principles established in Sec. 63.55. The

application for a Notice of MACT Approval or a title V permit, permit

modification, or administrative amendment, whichever is applicable,

shall include the documentation required by Sec. 63.53.

(b) Optional administrative procedures for preconstruction or pre-

operation review for new emission units. The permitting authority may

provide for an enhanced review of section 112(j) MACT determinations

that provides for review procedures and compliance requirements

equivalent to those set forth in paragraphs (b) through (h) of this

section.

(1) The permitting authority will notify the owner or operator in

writing as to whether the application for a MACT determination is

complete or whether additional information is required.

(2) The permitting authority will approve an applicant's proposed

control technology, or the permitting authority will notify the owner

or operator in writing of its intention to disapprove a control

technology.

(3) The owner or operator may present in writing, within a time

frame specified by the permitting authority, additional information,

considerations, or amendments to the application before the permitting

authority's issuance of a final disapproval.

(4) The permitting authority will issue a preliminary approval or

issue a disapproval of the application, taking into account additional

information received from the owner or operator.

(5) A determination to disapprove any application will be in

writing and will specify the grounds on which the disapproval is based.

(6) Approval of an applicant's proposed control technology will be

set forth in a Notice of MACT Approval (or the equivalent) as described

in Sec. 63.52(c).

(c) Opportunity for public comment on Notice of MACT Approval. The

permitting authority will provide opportunity for public comment on the

preliminary Notice of MACT Approval prior to issuance, including, at a

minimum,

(1) Availability for public inspection in at least one location in

the area affected of the information submitted by the owner or operator

and of the permitting authority's tentative determination;

(2) A period for submittal of public comment of at least 30 days;

and

(3) A notice by prominent advertisement in the area affected of the

location of the source information and analysis specified in

Sec. 63.52(c). The form and content of the notice will be substantially

equivalent to that found in Sec. 70.7 of this chapter.

(4) An opportunity for a public hearing, if one is requested. The

permitting authority will give at least 30 days notice in advance of

any hearing.

(d) Review by the EPA and Affected States. The permitting authority

will send copies of the preliminary notice (in time for comment) and

final notice required by paragraph (c) of this section to the

Administrator through the appropriate Regional Office, and to all other

State and local air pollution control agencies having jurisdiction in

the region in which the new source would be located. The permitting

authority will provide EPA with a review period for the final notice of

at least 45 days, and will not issue a final Notice of MACT approval

unless EPA objections are satisfied.

(e) Effective date. The effective date for new sources under this

subsection shall be the date a Notice of MACT Approval is issued to the

owner or operator of a new emission unit.

(f) Compliance date. New emission units shall comply with case-by-

case MACT upon issuance of a title V permit for the emission unit.

(g) Compliance with MACT Determinations. An owner or operator of a

major source that is subject to a MACT determination shall comply with

notification, operation and maintenance, performance testing,

monitoring, reporting, and recordkeeping requirements established under

Sec. 63.52(e), under title V, and at the discretion of the permitting

authority, under subpart A of this part. The permitting authority will

provide the EPA with the opportunity to review compliance requirements

for consistency with requirements established pursuant to title V

during the review period under paragraph (d) of this section.

(h) Equivalency under Section 112(l). If a permitting authority

requires preconstruction review for new source MACT determinations

under this subpart, such requirement shall not necessitate a

determination under subpart E of this part.

Sec. 63.55 Maximum achievable control technology (MACT) determinations

for emission units subject to case-by-case determination of equivalent

emission limitations.

(a) Requirements for emission units subject to case-by-case

determination of equivalent emission limitations. The owner or operator

of a major source submitting an application pursuant to Sec. 63.52 or

Sec. 63.54 shall include elements specified in Sec. 63.53, taking into

consideration the following requirements:

(1) When the Administrator has proposed a relevant emission

standard for the source category pursuant to section 112(d) or section

112(h) of the Act, then the control technologies recommended by the

owner or operator under Sec. 63.53(b)(12), when applied to the emission

points recommended by the applicant for control, shall be capable of

achieving all emission limitations and requirements of the proposed

standard unless the application contains information adequate to

support a contention that:

(i) different emissions limitations represent the maximum

achievable control technology emission limitations for the source

category, or

(ii) requirements different from those proposed by EPA will be

effective in ensuring that MACT emissions limitations are achieved.

(2) When the Administrator or the permitting authority has issued

guidance or distributed information establishing a MACT floor finding

for the source category or subcategory by the section 112(j) deadline,

then the recommended MACT emission limitations required by

Sec. 63.53(b)(11) must be at least as stringent as the MACT floor,

unless the application contains information adequately supporting an

amendment to such MACT floor.

(3)(i) When neither the Administrator nor the permitting authority

has issued guidance or distributed information establishing a MACT

floor finding and MACT determination for a source category or

subcategory by the section 112(j) deadline, then the owner or operator

shall submit an application for a permit or application for a Notice of

MACT Approval, whichever is applicable, containing the elements

required by Sec. 63.53(b) (1) through (9) and (14), by the section

112(j) deadline.

(ii) The owner or operator may recommend a control technology that

either achieves a level of control at least as stringent as the

emission control that is achieved in practice by the best controlled

similar source, or obtains at least the maximum reduction in emissions

of hazardous air pollutants that is achievable considering costs, non

air quality health and environmental impacts, and energy requirements.

(4) The owner or operator may select a specific design, equipment,

work practice, or operational standard, or combination thereof, when it

is not feasible to prescribe or enforce an equivalent emission

limitation due to the nature of the process or pollutant. It is not

feasible to prescribe or enforce a limitation when the Administrator

determines that a hazardous air pollutant (HAP) or HAPs cannot be

emitted through a conveyance designed and constructed to capture such

pollutant, or that any requirement for, or use of, such a conveyance

would be inconsistent with any Federal, State, or local law, or the

application of measurement methodology to a particular class of sources

is not practicable due to technological and economic limitations.

(b) Requirements for permitting authorities. The permitting

authority will determine whether the permit application or application

for a Notice of MACT Approval is approvable. If approvable, the

permitting authority will establish hazardous air pollutant emissions

limitations equivalent to the limitation that would apply if an

emission standard had been issued in a timely manner under subsection

112 (d) or (h) of the Act. The permitting authority will establish

these emissions limitations consistent with the following requirements

and principles:

(1) Emission limitations will be established for all emission units

within a source category or subcategory for which the section 112(j)

deadline has passed.

(2) Each emission limitation for an existing emission unit will

reflect the maximum degree of reduction in emissions of hazardous air

pollutants (including a prohibition on such emission, where achievable)

that the permitting authority, taking into consideration the cost of

achieving such emission reduction and any non-air quality health and

environmental impacts and energy requirements, determines is achievable

by emission units in the category or subcategory for which the section

112(j) deadline has passed. This limitation will not be less stringent

than the MACT floor, and will be based upon available information and

information generated by the permitting authority before or during the

application review process, including information provided in public

comments.

(3) Each emission limitation for a new emission unit will not be

less stringent than the emission limitation achieved in practice by the

best controlled similar source, and must reflect the maximum degree of

reduction in emissions of hazardous air pollutants (including a

prohibition on such emissions, where achievable) that the permitting

authority, taking into consideration the cost of achieving such

emission reduction, and any non-air quality health and environmental

impacts and energy requirements, determines is achievable. This

limitation will be based at a minimum upon available information and

information provided in public comments.

(4) When the Administrator has proposed a relevant emissions

standard for the source category pursuant to section 112(d) or section

112(h) of the Act, then the equivalent emission limitation established

by the permitting authority shall ensure that all emission limitations

and requirements of the proposed standard are achieved, unless the

permitting authority determines based on additional information that:

(i) Different emissions limitations represent the maximum

achievable control technology emission limitations for the source

category; or

(ii) Requirements different from those proposed by EPA will be

effective in ensuring that MACT emissions limitations are achieved.

(5) When the Administrator or the permitting authority has issued

guidance or collected information establishing a MACT floor finding for

the source category or subcategory, the equivalent emission limitation

for an emission unit must be at least as stringent as that MACT floor

finding unless, based on additional information, the permitting

authority determines that the additional information adequately

supports an amendment to the MACT floor. In that case, the equivalent

emission limitation must be at least as stringent as the amended MACT

floor.

(6) The permitting authority will select a specific design,

equipment, work practice, or operational standard, or combination

thereof, when it is not feasible to prescribe or enforce an equivalent

emission limitation due to the nature of the process or pollutant. It

is not feasible to prescribe or enforce a limitation when the

Administrator determines that a hazardous air pollutant (HAP) or HAPs

cannot be emitted through a conveyance designed and constructed to

capture such pollutant, or that any requirement for, or use of, such a

conveyance would be inconsistent with any Federal, State, or local law,

or the application of measurement methodology to a particular class of

sources is not practicable due to technological and economic

limitations.

(7) Nothing in this subpart will prevent a State or local

permitting authority from establishing an emission limitation more

stringent than required by Federal regulations.

(c) Reporting to National Data Base. The owner or operator shall

submit additional copies of its application for a permit, permit

modification, administrative amendment, or Notice of MACT Approval,

whichever is applicable, to the EPA by the section 112(j) deadline for

existing emission units, or by the date of the application for a permit

or Notice of MACT Approval for new emission units.

Sec. 63.56 Requirements for case-by-case determination of equivalent

emission limitations after promulgation of a subsequent MACT standard.

(a) If the Administrator promulgates an emission standard that is

applicable to one or more emission units within a major source before

the date a permit application under this paragraph is approved, the

permit shall contain the promulgated standard rather than the emission

limitation determined under Sec. 63.52, and the owner or operator shall

comply with the promulgated standard by the compliance date in the

promulgated standard.

(b) If the Administrator promulgates an emission standard under

section 112 (d) or (h) of the Act that is applicable to a source after

the date a permit is issued pursuant to Sec. 63.52 or Sec. 63.54, the

permitting authority shall revise the permit upon its next renewal to

reflect the promulgated standard. The permitting authority will

establish a compliance date in the revised permit that assures that the

owner or operator shall comply with the promulgated standard within a

reasonable time, but not longer than 8 years after such standard is

promulgated or 8 years after the date by which the owner or operator

was first required to comply with the emission limitation established

by permit, whichever is earlier.

(c) Notwithstanding the requirements of paragraph (a) or (b) of

this section, if the Administrator promulgates an emission standard

that is applicable to a source after the date a permit application is

approved under Sec. 63.52 or Sec. 63.54, the permitting authority is

not required to change the emission limitation in the permit to reflect

the promulgated standard if the level of control required by the

emission limitation in the permit is at least as stringent as that

required by the promulgated standard.

[FR Doc. 94-10971 Filed 5-19-94; 8:45 am]

BILLING CODE 6560-50-P