Approval and Promulgation of Implementation Plan; Michigan

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[MI51-01-7259; FRL-5840-6]

Approval and Promulgation of Implementation Plan; Michigan

AGENCY: Environmental Protection Agency.

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) proposes to approve

Michigan's request to grant an exemption for the Muskegon County ozone

nonattainment area from the applicable Oxides of Nitrogen

(NOX) transportation conformity requirements. On November

22, 1995, the Michigan Department of Environmental Quality (MDEQ)

submitted to the EPA a State Implementation Plan (SIP) revision request

for an exemption under section 182(b)(1) of the Clean Air Act (Act)

from the transportation conformity requirements for NOX for

the Muskegon ozone nonattainment area, which is classified as moderate.

The request is based on the urban airshed modeling (UAM) conducted for

the attainment demonstration for the Lake Michigan Ozone Study (LMOS)

modeling domain. The rationale for this proposed approval is set forth

in Supplementary Information; additional information is available at

the address indicated.

DATES: Comments on this proposed action must be received by July 14,

1997.

ADDRESSES: Written comments should be sent to: Carlton T. Nash, Chief,

Regulation Development Section, Air Programs Branch (AR-18J), EPA,

Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604-3590.

Copies of the SIP revision, public comments and EPA's responses are

available for inspection at the following address: United States

Environmental Protection Agency, Region 5, Air and Radiation Division,

77 West Jackson Boulevard, Chicago, Illinois 60604. (It is recommended

that you telephone Michael Leslie at (312) 353-6680 before visiting the

Region 5 Office.)

A copy of this SIP revision is available for inspection at the

following location: Office of Air and Radiation (OAR) Docket and

Information Center (Air Docket 6102), room M1500, United States

Environmental Protection Agency, 401 M Street S.W., Washington, D.C.

20460, (202) 260-7548.

FOR FURTHER INFORMATION CONTACT: Michael G. Leslie, Regulation

Development Section (AR-18J), Air Programs Branch, Air and Radiation

Division, United States Environmental Protection Agency, Region 5, 77

West Jackson Boulevard, Chicago, Illinois 60604, Telephone Number (312)

353-6680.

SUPPLEMENTARY INFORMATION:

I. Background

Clean Air Act section 176(c)(3)(A)(iii) requires, in order to

demonstrate conformity with the applicable SIP, that transportation

plans and Transportation Improvement Programs (TIPs) contribute to

emissions reductions in ozone and carbon monoxide nonattainment areas

during the period before control strategy SIPs are approved by EPA.

This requirement is implemented in 40 CFR 51.436 through 51.440 (and

Secs. 93.122 through 93.124), which establishes the so-called ``build/

no-build test.'' This test requires a demonstration that the ``Action''

scenario (representing the implementation of the proposed

transportation plan/TIP) will result in lower motor vehicle emissions

than the ``Baseline'' scenario (representing the implementation of the

current transportation plan/TIP). In addition, the ``Action'' scenario

must result in emissions lower than 1990 levels.

The November 24, 1993, final transportation conformity rule

1 does not

[[Page 32059]]

require the build/no-build test and less-than-1990 test for

NOX as an ozone precursor in ozone nonattainment areas,

where the Administrator determines that additional reductions of

NOX would not contribute to attainment of the National

Ambient Air Quality Standard (NAAQS) for ozone. Clean Air Act section

176(c)(3)(A)(iii), which is the conformity provision requiring

contributions to emission reductions before SIPs with emissions budgets

can be approved, specifically references Clean Air Act section

182(b)(1). That section requires submission of State plans that, among

other things, provide for specific annual reductions of volatile

organic compounds (VOCs) and NOX emissions ``as necessary''

to attain the ozone standard by the applicable attainment date. Section

182(b)(1) further states that its requirements do not apply in the case

of NOX for those ozone nonattainment areas for which EPA

determines that additional reductions of NOX would not

contribute to ozone attainment.

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\1\ ``Criteria and Procedures for Determining Conformity to

State or Federal Implementation Plans of Transportation Plans,

Programs, and Projects Funded or Approved under Title 23 U.S.C. of

the Federal Transit Act'' November 24, 1993 (58 FR 62188).

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For ozone nonattainment areas, the process for submitting waiver

requests and the criteria used to evaluate them are explained in the

December 1993 EPA document ``Guidelines for Determining the

Applicability of Nitrogen Oxides Requirements Under Section 182(f),''

and the May 27, 1994, and February 8, 1995, memoranda from John S.

Seitz, Director of the Office of Air Quality Planning and Standards, to

Regional Air Division Directors, titled ``Section 182(f) NOX

Exemptions--Revised Process and Criteria.''

On July 13, 1994, the States of Illinois, Indiana, Michigan, and

Wisconsin (the States) submitted to the EPA a petition for an exemption

from the requirements of section 182(f) of the Clean Air Act (Act). The

States, acting through the Lake Michigan Air Directors Consortium

(LADCo), petitioned for an exemption from the Reasonably Available

Control Technology (RACT) and New Source Review (NSR) requirements for

major stationary sources of NOX. The petition also asked for

an exemption from the transportation and general conformity

requirements for NOX in all ozone nonattainment areas in the

Region.

On March 6, 1995, the EPA published a rulemaking proposing approval

of the NOX exemption petition for the RACT, NSR and

transportation and general conformity requirements. A number of

comments were received on the proposal. Several commenters argued that

NOX exemptions are provided for in two separate parts of the

Act, in sections 182(b)(1) and 182(f), but that the Act's

transportation conformity provisions in section 176(c)(3) explicitly

reference section 182(b)(1). In April 1995, the EPA entered into an

agreement to change the procedural mechanism through which a

NOX exemption from transportation conformity would be

granted (EDF et al. v. EPA, No. 94-1044, U.S. Court of Appeals, D.C.

Circuit). Instead of a petition under 182(f), transportation conformity

NOX exemptions for ozone nonattainment areas that are

subject to section 182(b)(1) now need to be submitted as a SIP revision

request. The Muskegon ozone nonattainment areas is classified as

moderate and, thus, is subject to section 182(b)(1).

The transportation conformity requirements are found at sections

176(c) (2), (3), and (4). The conformity requirements apply on an area

wide basis in all nonattainment and maintenance areas. The EPA's

transportation conformity rule was amended on August 29, 1995 (60 FR

44762) to reference section 182(b)(1) rather than 182(f) as the means

for exempting areas subject to section 182(b)(1) from the

transportation conformity NOX requirements.

The November 22, 1995, SIP revision request from Michigan, was

submitted to meet the requirements in accordance with 182(b)(1). A

public hearing on this SIP revision request was held on September 6,

1995. The EPA issued a finding of completeness on January 17, 1996.

In evaluating the 182(b) SIP revision request, the EPA considered

whether additional NOX reductions would contribute to

attainment of the standard in Muskegon County and also in the downwind

areas of the LMOS modeling domain.

The role that NOX emissions play in producing ozone at

any given place and time is complex. NOX primarily

represents a sum of two oxides of nitrogen, namely nitrogen oxide (NO)

and nitrogen dioxide (NO2). In the presence of sunlight,

NO2 photo-dissociates into NO2 and a single

oxygen atom. The oxygen atom reacts with molecular oxygen

(O2) to form ozone (O3). NO, on the other hand,

near its source area readily reacts with ozone to form O2

and NO. The generated NO2 is then free to photo-

dissociate and lead to ozone formation further downwind. The reaction

of NO with ozone, which locally reduces ozone concentrations, is

referred to as ozone scavenging and is one of the primary local sinks

for ozone in the lower atmosphere in and near NO source areas. Since

emissions of NOX from fuel combustion sources, whether

internal combustion engines or stationary combustion sources, such as

industrial boilers, contain significant amounts of NO, it is expected

that ozone concentrations immediately downwind of such NOX

sources will be reduced through ozone scavenging. Therefore, reducing

NOX emissions can lead to increased ozone concentrations in

the vicinity of the controlled NOX emission sources, whereas

reducing NOX emissions may lead to reduction in ozone

concentrations further downwind. Reducing NOX emissions in

VOC-limited areas (areas with low VOC emissions relative to

NOX emissions) may produce minimal ozone reductions or even

ozone increases.

As outlined in relevant EPA guidance, the use of photochemical grid

modeling is the recommended approach for testing the contribution of

NOX emission reductions to attainment of the ozone standard.

This approach simulates conditions over the modeling domain that may be

expected at the attainment deadline for three emission reduction

scenarios: (1) Substantial VOC reductions, (2) substantial

NOX reductions, and (3) both VOC and NOX

reductions. If the area wide predicted maximum one-hour ozone

concentration for each day modeled under scenario (1) is less than or

equal to those from scenarios (2) and (3) for the corresponding days,

the test is passed and the section 182(f) NOX emissions

reduction requirements would not apply.

In making this determination under section 182(b)(1) that the

NOX requirements do not apply, or may be limited in the Lake

Michigan area, the EPA has considered the national study of ozone

precursors completed pursuant to section 185B of the Act. The EPA has

based its decision on the demonstration and the supporting information

provided in the SIP revision request.

II. Summary of Submittal

On November 22, 1995, the State of Michigan submitted as a revision

to the SIP, a request for a waiver from the transportation conformity

NOX requirements. The submittal included the LMOS UAM

modeling for the attainment demonstration for 3 ozone episodes during

1991. The modeling supported the request by documenting that

NOX reductions in the LMOS modeling domain would not

contribute to attainment and, in fact, would be detrimental to the goal

of reaching attainment. The MDEQ held a public hearing on the submittal

on September 6, 1996.

[[Page 32060]]

Pursuant to 40 CFR Part 93, Subpart A, and 40 CFR Part 51, Subpart

T, the SIP revision request seeks an exemption from the transportation

conformity requirements for NOX in the Muskegon County ozone

nonattainment area. The States' have utilized the UAM to demonstrate

that reductions in NOX in the LMOS modeling domain will not

contribute to attainment of the standard. To conduct the modeling

analysis, the following steps were followed: (a) Emissions were

projected to 1996 (the deadline for implementation of the 15 percent

reasonable further progress reduction) and 2007 (the attainment

deadline for the severe nonattainment areas) from the 1990 base year,

(b) it was assumed that a 40 percent VOC emission reduction beyond that

achieved as a result of emission controls mandated by the Act would be

necessary to attain the ozone standard in the LMOS modeling domain, (c)

a 40 percent NOX emission reduction in grid B (that portion

of the LMOS modeling domain that is essentially composed of the ozone

nonattainment areas within the modeling domain) beyond the projected

emission levels was assumed for all anthropogenic NOX

emissions, (d) a 40 percent VOC emission reduction and a 40 percent

NOX reduction in grid B beyond projected emission levels

were assumed for all anthropogenic VOC and NOX emissions,

and (e) the ozone modeling results for (b), (c), and (d) were compared

considering the modeled domain-wide peak ozone concentrations and

temporal and spatial extent of modeled ozone concentrations above 120

parts per billion (ppb).

For all modeled days using 1996 and 2007 conditions, domain-wide

peak ozone concentrations for ``VOC-only'' controls were found to be

lower than or equal to those for ``NOX-only'' controls or

those for ``VOC plus NOX'' controls. In addition,

consideration of daily peak ozone isopleth maps (these maps are

included in the documentation of the section 182(b) SIP revision

request) shows that the ``VOC-only'' control scenario leads to the

smallest areas with predicted peak ozone concentrations exceeding 120

ppb.

Additional sensitivity tests were conducted for a 40 percent

NOX emission reduction that was applied only to point

sources in Grid B for episode 2 and 1996 conditions for both an assumed

NOX reduction alone and a 40 percent reduction in both VOCs

and NOX. These sensitivity tests compared to the scenarios

with across the board anthropogenic NOX reductions

demonstrated that control of ground level NOX sources (such

as transportation sources) did not contribute to attainment of the

standard and in fact increased the domain wide peak ozone

concentrations exceeding 120 ppb and the number of hours that exceeded

120 ppb. This result was more pronounced than with the point source

only NOX control.

III. Analysis of the Submittal

Review of the modeling results show a very definite directional

signal indicating that application of NOX controls in the

Muskegon County ozone nonattainment area would exacerbate peak ozone

concentrations not in the LMOS modeling domain. The LMOS modeling

domain includes Chicago, Northwest Indiana, Western Michigan and

Eastern Wisconsin. The States and LADCo have now completed the

validation process for the UAM modeling system to be used in the

demonstration of attainment for the LMOS modeling domain. Therefore,

documentation supporting the validity of the modeling results has been

submitted with the SIP revision request.

It is noted that the use of simple, area-wide emission projection

factors raises some uncertainty in the modeling results for 1996 and

2007. Some changes in modeling results may be expected if area-specific

and source category-specific projection factors are used instead of the

average factors used in these analyses. These more detailed projection

factors will be used in the final demonstration of attainment for the

LMOS domain. These changes, however, are not expected to reverse the

directional signal of the modeling done to date, which shows that

NOX reductions will not contribute to attainment in Muskegon

County ozone nonattainment and throughout the LMOS domain.

Although ozone concentrations modeled further downwind from the

urban source areas increase as a result of increased NOX

point source emissions, this is not the case with the ground level

NOX sources. LADCo and the States view the potential

increase in outflow ozone concentrations with increasing NOX

point source emissions to be marginal. More importantly, the SIP

revision request demonstrates that additional reductions in

NOX would not contribute to attainment of the ozone standard

in the LMOS domain. These results are believed to be consistent with

EPA's section 185B report to Congress. Therefore, based on it's

conformance with EPA guidance, the EPA believes the State of Michigan's

demonstration is adequate, and thus is approving the transportation

conformity waiver request. It is noted by LADCo, however, that

subsequent modeling analyses may lead to an ozone attainment plan which

includes, for specified portions of the LMOS domain only, both

NOX and VOC emission controls. The modeling indicates that

these NOX emission controls will most likely be limited to

rural areas, but would not be required in the Michigan nonattainment

area and will also not likely be applied to ground level sources.

Monitoring data such as concentrations of non-methane hydrocarbons

and NOX and derived/monitored ozone production potentials of

air parcels, collected for the urban source areas during the 1991 field

study support the approval of the NOX waiver. However, the

primary basis for the approval of the NOX waiver is the

modeling results submitted in support of the waiver. The 1991 field

data by themselves may not be an adequate support for the waiver since

these data are limited in nature and do not assess the impacts of post-

1991 NOX controls on LMOS modeling domain peak ozone

concentrations.

VOC and NOX emission reductions were found to produce

different impacts spatially. In and downwind of major urban areas,

within the ozone nonattainment areas, VOC reductions were effective in

lowering peak ozone concentrations, while NOX emission

reductions resulted in increased peak ozone concentrations. Farther

downwind, within attainment areas, VOC emissions reductions became less

effective for reducing ozone concentrations, while NOX

emission reductions were effective in lowering ozone concentrations. It

must be noted, however, that the magnitude of ozone decreases farther

downwind due to NOX emission reductions was less than the

magnitude of ozone increases in the ozone nonattainment areas as a

result of the same NOX emission reductions.

Analyses of ambient data by LMOS contractors provided results which

corroborated the modeling results. These analyses identified areas of

VOC-and NOX-limited conditions (VOC-limited conditions would

imply a greater sensitivity of ozone concentrations to changes in VOC

emissions; the reverse would be true for NOX-limited

conditions) and tracked the ozone and ozone precursor concentrations in

the urban plumes as they moved downwind. The analyses indicated VOC-

limited conditions in the Chicago/Northwest Indiana and Milwaukee areas

and NOX-limited conditions further downwind. These results

imply that VOC controls in the Chicago/Northwest Indiana, Milwaukee,

and Western Michigan areas would be

[[Page 32061]]

more effective at reducing peak ozone concentrations within the Lake

Michigan ozone nonattainment areas.

The consistency between the modeling results and the ambient data

analysis results for all episodes with joint data supports the view

that the UAM modeling system developed in the LMOS may be used to

investigate the relative merits of VOC versus NOX emission

controls. The UAM-V results for all modeled episodes point to the

benefits of VOC controls versus NOX controls in reducing the

modeled domain peak ozone concentrations.

For a more detailed analysis of the modeling analysis results,

please see the August 22, 1994 ``Technical Review of a Four State

Request for a Section 182(f) Exemption from Oxides of Nitrogen

(NOX) Reasonably Available Control Technology (RACT) and New

Source Review (NSR) Requirements'' memorandum contained in the docket

for this action.

The EPA believes LADCo's UAM application has adequately met the

requirement to demonstrate that NOX controls within the

Muskegon County ozone nonattainment area and throughout the LMOS domain

will not contribute, but instead will interfere with attainment of the

ozone standard.

IV. EPA Action

The EPA is proposing approval of the transportation conformity

NOX waiver SIP revision for the State of Michigan. In light

of the modeling completed thus far and considering the importance of

the Ozone Transport Assessment Group (OTAG) process and attainment plan

modeling efforts, EPA proposes to approve this NOX waiver on

a contingent basis. When the results of OTAG technical work are

available, EPA intends to require appropriate States to submit SIP

measures to ensure emissions reductions of ozone precursors needed to

prevent significant transport of ozone. The EPA will evaluate the OTAG

technical work, along with EPA's emissions reduction requirements, to

determine whether the NOX waiver should be continued,

altered, or removed.

The EPA also reserves the right to require NOX emission

controls for transportation sources under section 110(a)(2)(D) of the

Act if future ozone modeling demonstrates that such controls are needed

to achieve the ozone standard in downwind areas.

V. Miscellaneous

A. Applicability to Future SIP Decisions

Nothing in this action should be construed as permitting, allowing

or establishing a precedent for any future request for revision to any

SIP. The EPA shall consider each request for revision to the SIP in

light of specific technical, economic, and environmental factors and in

relation to relevant statutory and regulatory requirements.

B. Executive Order 12866

This action has been classified as a Table 3 action for signature

by the Regional Administrator under the procedures published in the

Federal Register on January 19, 1989 (54 FR 2214-2225), as revised by a

July 10, 1995 memorandum from Mary Nichols, Assistant Administrator for

Air and Radiation. The Office of Management and Budget has exempted

this regulatory action from E.O. 12866 review.

C. Regulatory Flexibility

Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., EPA

must prepare a regulatory flexibility analysis assessing the impact of

any proposed or final rule on small entities (5 U.S.C. 603 and 604).

Alternatively, EPA may certify that the rule will not have a

significant economic impact on a substantial number of small entities.

Small entities include small businesses, small not-for-profit

enterprises, and government entities with jurisdiction over populations

of less than 50,000.

This approval does not impose any requirements on small entities.

Therefore, I certify that this action does not have a significant

economic impact on any small entities.

D. Unfunded Mandates Reform Act

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 of $100 million or more 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 approval proposed 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.

This Federal document does not imposes any Federal requirements.

Accordingly, no additional costs to State, local, or tribal

governments, or the private sector, result from this action.

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Hydrocarbons,

Intergovernmental relations, Ozone, Oxides of Nitrogen, Transportation

conformity, Transportation-air quality planning, Volatile organic

compounds.

Authority: 42 U.S.C. 7401-7671q.

Dated: May 30, 1997.

Valdas V. Adamkus,

Regional Administrator.

[FR Doc. 97-15411 Filed 6-11-97; 8:45 am]

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