National Emission Standards for Hazardous Air Pollutants for Source Categories: Gasoline Distribution (Stage 1)

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 63

[FRL-5325-6]

RIN 2060-AD93

National Emission Standards for Hazardous Air Pollutants for

Source Categories: Gasoline Distribution (Stage 1)

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed amendments.

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

SUMMARY: Today's action provided in this document proposes to amend the

rule, ``National Emission Standards for Hazardous Air Pollutants for

Source Categories: Gasoline Distribution (Stage I)'' (the ``Gasoline

Distribution NESHAP''), promulgated on December 14, 1994. The proposal

would amend the initial compliance date for the equipment leak

provisions applicable to existing sources from no later than December

14, 1995 to no later than December 15, 1997, and would amend the date

by which an existing facility must provide an initial notification to

December 16, 1996 or 1 year after a facility becomes subject to the

Gasoline Distribution NESHAP, whichever is later. These modifications

are being proposed because the compliance date for these provisions is

approaching and the EPA believes that, under current circumstances,

additional time will allow sources a better opportunity to establish

major or area source status without foregoing quantifiable emissions

reductions. The EPA is requesting comments for the next 30 days only on

the proposed changes discussed in this document.

DATES: Comments. Comments must be received on or before December 7,

1995 unless a hearing is requested by November 17, 1995. If a hearing

is requested, written comments must be received by December 22, 1995.

Public Hearing. Anyone requesting a public hearing must contact the

EPA no later than November 21, 1995. If a hearing is held, it will take

place on November 21, 1995, beginning at 9:00 a.m.

ADDRESSES: Comments. Comments should be submitted (in duplicate, if

possible) to: Air Docket (6102), Attention Docket Number A-92-38 (see

docket section below), room M1500, U.S. Environmental Protection

Agency, 401 M St., S.W., Washington, D.C. 20460. The EPA requests that

a separate copy also be sent to the contact person listed below.

Public Hearing. If a public hearing is held, it will be held at the

EPA's Office of Administration Auditorium, Research Triangle Park,

North Carolina. Persons interested in attending the hearing or wishing

to present oral testimony should notify Ms. JoLynn Collins, U.S.

Environmental Protection Agency, Research Triangle Park, N.C. 27711,

telephone (919) 541-5671.

Docket. Docket No. A-92-38, Categories VI Reconsideration and VII

Amendments, contains information considered by the EPA in developing

this proposal document and is available for public inspection and

copying between 8:00 a.m. and 4:00 p.m., Monday through Friday,

including all non-Government holidays, at the EPA's Air and Radiation

Docket and Information Center, room M1500, U.S. Environmental

Protection Agency, 401 M Street, SW., Washington, D.C. 20460; telephone

(202) 260-7548. A reasonable fee may be charged for copying. This

docket also contains information considered by the EPA in proposing and

promulgating the Gasoline Distribution NESHAP.

FOR FURTHER INFORMATION CONTACT: Mr. Stephen Shedd at telephone number

(919) 541-5397 or at facsimile number (919) 541-3470, Emission

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

Research Triangle Park, North Carolina 27711.

SUPPLEMENTARY INFORMATION:

I. Background

On December 14, 1994 (59 FR 64303), the EPA promulgated the

``National Emission Standards for Hazardous Air Pollutants for Source

Categories: Gasoline Distribution (Stage I)'' (the ``Gasoline

Distribution NESHAP''). The Gasoline Distribution NESHAP regulates all

hazardous air pollutants (HAP) emitted from new and existing bulk

gasoline terminals and pipeline breakout stations that are major

sources of HAP emissions or are located at sites that are major sources

of HAP emissions. Among the promulgated requirements for existing

sources under this rule are the requirements that sources institute an

equipment leak prevention program and provide an initial notification

of regulatory status no later than December 14, 1995 (40 CFR

Secs. 63.424(e) and 63.428(a)).

Whether a bulk gasoline terminal or pipeline breakout station is a

major source or at a site that is a major source is determined by a

site's ``potential to emit considering controls'' (Act 112(a), 42

U.S.C. 7412(a)). In the Gasoline Distribution NESHAP, the EPA

promulgated two mechanisms for determining major source status that are

specific to this rule: first, the NESHAP included screening equations

for determining potential emissions from terminals and breakout

stations based on the HAP content of gasoline, gasoline throughput, and

emission rates from equipment used to handle gasoline; and second, the

NESHAP allowed for case-by-case review or ``emissions inventory'' of a

site's emissions (40 CFR Sec. 63.420). The equations could be used only

by bulk terminals and pipeline breakout stations that were at sites

that had no other sources of HAP. Other sources would be able to

establish potential to emit either by an emissions inventory or by

using other means (outside the rule) that are generally available to

sources under Subpart A of part 63, the General Provisions, and related

guidance.

When the EPA promulgated the Gasoline Distribution NESHAP, the EPA

anticipated that about 75 percent of all gasoline bulk terminals and

pipeline breakout stations would be able to establish area source

status. However, the EPA recognizes that several developments since

promulgation of the rule have affected the number of sources that will

establish area source status.

First, through a petition for reconsideration filed by the American

Petroleum Institute (API), the EPA has learned that virtually all bulk

terminals and pipeline breakout stations have HAP containing fluids

such as distillates (e.g., diesel fuel and heating fuel oil) that are

handled in equipment outside of the source category. According to API,

this limits the utility of the emissions screening equation as a method

for establishing potential to emit.

Second, the EPA has issued two guidance memoranda on options for

and timing of establishing potential to emit limits. See memorandum

from John S. Seitz, Director, Office of Air Quality Planning and

Standards, and Robert I. Van Heuvelen, Director, Office of Regulatory

Enforcement, ``Options for Limiting the Potential to Emit (PTE) of

[[Page 56134]]

a Stationary Source under Section 112 and Title V of the Clean Air Act

(Act)'' (January 25, 1995); and memorandum from John S. Seitz,

``Potential to Emit for MACT Standards--Guidance on Timing Issues''

(May 16, 1995). These memoranda are available in the docket (see

ADDRESSES section). The first memorandum identified a number of ways

States and sources could establish federally enforceable limits for

potential to emit. In addition, the memorandum created a 2-year

transition period (until January 1997) under which sources could be

treated as area sources if (1) the source actually emits less than 50

percent of the major source threshold and keeps adequate records, or

(2) the source emits between 50 and 100 percent of the major source

threshold, and is limited to this level by State limitations that are

enforceable as a practical matter.

The second memorandum addressed timing issues related to the

applicability of NESHAP that affect only major sources. Major sources

can reduce their potential emissions by obtaining federally enforceable

limitations on their potential to emit, and as a result can achieve

area source status. Before the memorandum was released, it was not

clear whether there was a deadline for achieving area source status,

and whether a source that reduced its potential emissions after the

deadline could avoid being subject to the standard. The memorandum

explained that, in the absence of rulemaking, the best reading of

section 112 would require area source status to be achieved by the

first substantive compliance date of a NESHAP. Additionally, the

memorandum explained that unless area source status is achieved by this

deadline, it will be permanently treated as a major source for purposes

of that NESHAP.

Applying these two guidances to the Gasoline Distribution NESHAP

would mean that, in order to avoid being permanently treated as a major

source subject to the NESHAP, gasoline distribution facilities would

need to achieve area source status before December 15, 1995, the

compliance date for the equipment leaks provision. Industry reports

there are a number of sources emitting less than the major source

threshold that do not have what the EPA believes are practicably

enforceable limitations on their potential to emit. Under the

transition policy discussed above, sources emitting more than 50

percent of major source threshold and lacking practicably enforceable

limits, are currently treated as major sources. The mechanisms for

establishing practicably enforceable limitations on ``throughput'' (the

amount of gasoline, distillate, and other HAP emitting liquids handled

at the terminal or breakout station) generally exist. Those mechanisms,

however, require time to process to put into place for sources. Given

the proximity of the date of the May 16 policy guidance to the December

15, 1995 deadline, the EPA believes that some sources emitting more

than 50 percent of the major source threshold may not have a reasonable

time period to establish practical limitations on their potential to

emit.

II. Summary of and Rationale for the Amendments

Because the developments since promulgation of the Gasoline

Distribution NESHAP have led the EPA to believe that fewer sources will

be able to achieve area source status than had been anticipated, the

EPA has considered ways to modify policy or rule provisions so that the

applicability of the NESHAP will reflect the EPA's intent at the time

of promulgation. After considering revising one or both of the

guidances as they would apply to this source category, and after

considering the amendment of the emissions screening equation, the EPA

believes the most appropriate way to allow sources a better opportunity

to establish major or area source status without foregoing quantifiable

emission reductions would be to defer the compliance date for the

equipment leak provisions for existing sources until December 15, 1997.

Furthermore, for the reasons discussed below, the EPA proposes amending

the initial notification provisions so that notice is not required

until December 16, 1996.

Deferral of the existing source compliance dates for equipment leak

programs and initial notifications is consistent with the deadlines for

compliance under the Act section 112(i), which requires existing major

sources to be in compliance with a rule within 3 years of promulgation.

The deferral of the equipment leak provisions will give facilities

significant additional time to obtain appropriate limits on potential

to emit hazardous air pollutants. The deferral of the initial

notification for existing sources will give cargo truck operators more

accurate notice of the regulatory status of the terminals that they use

and provide adequate lead time for any necessary truck vapor tightness

testing to be performed during normal testing schedules. Additionally,

the notices will provide Federal, State, and local air pollution

control agencies an opportunity to plan for the implementation of this

rule prior to the first compliance date for existing sources. The

initial notifications will be considered non-binding in the case of

sources that are major sources on December 16, 1996, but become area

sources prior to December 15, 1997. Sources that cannot limit their

potential to emit before December 15, 1997, must comply with the

requirements for major sources under the Gasoline Distribution NESHAP

by that date.

Emissions of HAP associated with equipment leaks at bulk terminals

and pipeline breakout stations were estimated to be less than 2 percent

of baseline HAP emissions for the source category. An industry survey

indicated that 80 percent of bulk terminals were already performing

some type of periodic visual leak detection program; therefore,

deferring the compliance date of the Gasoline Distribution NESHAP

provisions on leak detection would not forego significant emission

reductions.

Deferring the compliance date for the equipment leak provisions for

existing sources is preferable to the other available options. The

other options are: (1) to deem the January 25 or May 16 guidance

memoranda inapplicable to the Gasoline Distribution NESHAP; (2) to

adopt a temporary certification scheme similar to that adopted for the

Hazardous Organic NESHAP (HON); and (3) to modify the emission

screening equations based on data currently before the EPA. While the

guidances do not have the legal status of a rule, the EPA continues to

believe that the analysis expressed in the timing guidance is the best

reading of the Act section 112. Addressing the timing issues by

allowing a site to temporarily be a major source and then subsequently

an area source would mean that many sources would be temporarily

subject to the equipment leak provisions. Not only would this pose

difficulties in assuring compliance but it would also produce little,

if any, emission reduction benefits.

If the EPA were to allow an owner or operator of a source to make a

temporary certification that the source is not at a major source, in a

manner similar to the HON amendments promulgated on April 10, 1995 (60

FR 18020), then potentially hundreds of temporary certifications would

be required. Unlike the source category subject to the HON, which is

estimated to have 20 to 40 eligible plant sites, air pollution control

agencies would have little practical opportunity for oversight of these

numerous temporary certifications. Therefore, because of the temporary

nature of the HON certifications and the vast difference in

[[Page 56135]]

the numbers of potential certifications, the EPA is not proposing to

condition an extension of the compliance date on the filing of a

certification that actual emissions are below major source levels.

At this time, the EPA does not have sufficient analyzed data and

information to propose modification to the emission screening equation

in the rule. The EPA is considering data submitted by the API as part

of its petition for reconsideration (available in the docket) and may

propose modification of the equation and request comment at a later

date. The EPA is not requesting comments at this time on the petition

for reconsideration or potential changes to the emission screening

equation.

III. Administrative Requirements

A. Paperwork Reduction Act

The information collection requirements of the previously

promulgated NESHAP were submitted to and approved by the Office of

Management and Budget (OMB). A copy of this Information Collection

Request (ICR) document (OMB control number 2060-0325) may be obtained

from Ms. Sandy Farmer, Information Policy Branch, Environmental

Protection Agency, 401 M St., S.W. (mail code 2136), Washington, D.C.

20460, or by calling (202) 260-2740.

Today's proposed changes to the Gasoline Distribution NESHAP have

no impact on the information collection burden estimates made

previously. No additional certifications or filings are proposed.

Therefore, the ICR has not been revised.

B. Executive Order 12866

Under Executive Order 12866 (58 FR 51735, October 4, 1993), the EPA

must determine whether a regulation is ``significant'' and therefore

subject to OMB review and the requirements of the Executive Order. The

criteria set forth in section 1 of the Order for determining whether a

regulation is a significant rule are as follows:

(1) Is likely to 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 government communities;

(2) Is likely to create a serious inconsistency or otherwise

interfere with an action taken or planned by another agency;

(3) Is likely to materially alter the budgetary impact of

entitlements, grants, user fees, or loan programs or the rights and

obligations of recipients thereof; or

(4) Is likely to raise novel or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order.

The Gasoline Distribution NESHAP promulgated on December 14, 1994,

was treated as a ``significant regulatory action'' within the meaning

of the Executive Order. An estimate of the cost and benefits of the

NESHAP was prepared at proposal as part of the Background Information

Document (BID) and was updated in the BID for the final rule to reflect

comments and changes to the final rule. The amendments proposed today

would have no impact on the estimates in the BID. The EPA's earlier

estimates of costs and emission reductions were based on the Gasoline

Distribution NESHAP affecting only major sources and did not quantify

the emissions reductions associated with the visual equipment leak

detection program; in any event, these emission reductions are small

relative to the total reduction for the source category.

Pursuant to the terms of Executive Order 12866, it has been

determined that this action is a ``non-significant regulatory action''

within the meaning of the Executive Order. As such, this action was not

submitted to OMB for review.

C. Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires the

EPA to consider potential impacts of regulations on small business

entities. The Act specifically requires the preparation of a Regulatory

Flexibility Analysis in those instances where small business impacts

are possible. When the EPA promulgated the Gasoline Distribution

NESHAP, it analyzed the potential impacts on small businesses,

discussed the results of this analysis in the Federal Register, and

concluded that the promulgated regulation would not result in financial

impacts that significantly or differentially stress affected small

companies. Because today's proposal imposes no additional impacts, a

Regulatory Flexibility Analysis has not been prepared.

Pursuant to the provisions of 5 U.S.C. 605(b), I hereby certify

that this rule will not have a significant economic impact on a

substantial number of small business entities.

D. Unfunded Mandates

Under section 202 of the Unfunded Mandates Reform Act of 1995

(Unfunded Mandates Act), signed into law on March 22, 1995, the EPA

must prepare a budgetary impact statement to accompany any proposed or

final rule that includes a Federal mandate that may result in estimated

costs to State, local, or tribal governments in the aggregate, or to

the private sector, of $100 million or more. Under section 205, the EPA

must select the most cost effective and least burdensome alternative

that achieves the objectives of the rule and is consistent with

statutory requirements. Section 203 requires the EPA to establish a

plan for informing and advising any small governments that may be

significantly or uniquely impacted by the rule.

The EPA has determined that the action proposed today does not

include a Federal mandate that may result in estimated costs of $100

million or more to either State, local, or tribal governments in the

aggregate, or to the private sector. Therefore, the requirements of the

Unfunded Mandates Act do not apply to this action.

List of Subjects in 40 CFR Part 63

Environmental protection, Air pollution control, Hazardous

substances, Petroleum bulk stations and terminals, Reporting and

recordkeeping requirements.

Dated: November 1, 1995.

Carol M. Browner,

Administrator.

For the reasons set out in the preamble, part 63 of chapter I of

title 40 of the Code of Federal Regulations is proposed to be amended

as follows:

PART 63--NATIONAL EMISSION STANDARDS FOR HAZARDOUS AIR POLLUTANTS

FOR SOURCE CATEGORIES

1. The authority citation for part 63 continues to read as follows:

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

2. Section 63.424 is amended by revising paragraph (e) to read as

follows:

Sec. 63.424 Standards: Equipment leaks.

* * * * *

(e) Initial compliance with the requirements in paragraphs (a)

through (d) of this section shall be achieved by existing sources as

expeditiously as practicable, but no later than December 15, 1997. For

new sources, initial compliance shall be achieved upon startup.

* * * * *

3. Section 63.428 is amended by revising paragraphs (a) and the

first sentence of paragraph (f)(1) to read as follows:

Sec. 63.428 Reporting and recordkeeping.

(a) The initial notifications required for existing affected

sources under

[[Page 56136]]

Sec. 63.9(b)(2) shall be submitted by 1 year after an affected source

becomes subject to the provisions of this subpart or by December 16,

1996, whichever is later. Affected sources that are major sources on

December 16, 1996 and plan to be area sources by December 15, 1997

shall include in this notification a brief, non-binding description of

and schedule for the action(s) that are planned to achieve area source

status.

* * * * *

(f) * * *

(1) In the case of an existing source or a new source that has an

initial startup date before the effective date, the report shall be

submitted with the notification of compliance status required under

Sec. 63.9(h), unless an extension of compliance is granted under

Sec. 63.6(i). * * *

* * * * *

4. Table 1 to subpart R is amended by revising the entry

``63.9(b)(2)'' to read as follows:

* * * * *

Table 1 to Subpart R.--General Provisions Applicability to Subpart R

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

Applies to subpart

Reference R Comment

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

* * * *

* * *

63.9(b)(2)............. Yes................ Subpart R allows addition

time for existing sources

to submit initial

notification. Sec.

63.428(a) specifies

submittal by 1-year after

being subject to rule or

December 16, 1997,

whichever is later.

* * * *

* * *

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

[FR Doc. 95-27568 Filed 11-6-95; 8:45 am]

BILLING CODE 6560-50-P