Calls for State Implementation Plan Revisions for Certain States To Reduce Regional Transport of Ozone

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[FRL-5674-4]

Calls for State Implementation Plan Revisions for Certain States

To Reduce Regional Transport of Ozone

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of intent.

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SUMMARY: In accordance with section 110(k)(5) and 110(a)(2)(D) of the

Clean Air Act (Act), the EPA plans to require States to submit State

implementation plan (SIP) measures to ensure that emission reductions

are achieved as needed to prevent significant transport of ozone (smog)

pollution across State boundaries in the Eastern United States. These

precursors include volatile organic compounds (VOC) and oxides of

nitrogen (NOx).

Today's notice announces the Agency's intention to publish a Notice

of Proposed Rulemaking in the March 1997 timeframe, with final action

scheduled for summer 1997. Ozone has long been recognized, in both

clinical and epidemiological research, to affect public health. There

is a wide range of ozone-induced health effects, including decreased

lung function (primarily in children active outdoors), increased

respiratory symptoms (particularly in highly sensitive individuals),

hospital admissions and emergency room visits for respiratory causes

(among children and adults with pre-existing respiratory disease such

as asthma), inflammation of the lung, and possible long-term damage to

the lungs. Today's notice announces EPA's intention to conduct the

formal process for implementing the regional reductions in ozone

precursors that are necessary for areas in the Eastern United States to

reach attainment. The Ozone Transport Assessment Group (OTAG) was

established approximately 1\1/2\ years ago to undertake an assessment

of the regional transport problem. The OTAG is a collaborative process

conducted by the affected States. The OTAG also includes

representatives from EPA and interested members of the public,

including environmental groups and industry, to evaluate the ozone

transport problem and the development of solutions.

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SUPPLEMENTARY INFORMATION:

Availability of Related Information

Documents related to OTAG are available on the Agency's Office of

Air Quality Planning and Standards' (OAQPS) Technology Transfer Network

(TTN) Bulletin Board System (BBS). The telephone number for the TTN BBS

is (919) 541-5742. To access the bulletin board a modem and

communications software are necessary. The following parameters on the

communications software are required: Data Bits-8; Parity-N; and Stop

Bits-1. The documents will be located on the OTAG BBS. If assistance is

needed in accessing the system, call the help desk at (919) 541-5384 in

Research Triangle Park, NC. Other documents related to OTAG can be

downloaded from OTAG's webpage at http://www.epa.gov/oar/otag/

otag.html.

I. Background

A. Overview of 1990 Amendments to the Clean Air Act (1990 Amendments)

In 1990, Congress amended the Act to address, among other things,

continued nonattainment of the ozone national ambient air quality

standard (NAAQS) (Pub. L. 101-549, Nov. 15, 1990, 104 Stat. 2399,

codified at 42 U.S.C. 7401-7671q). Several of the provisions added, or

revised, by the 1990 Amendments are relevant to today's notice.

The 1990 Amendments divide ozone nonattainment areas into, in

general, five classifications based on air quality design value and

establish specific requirements, including new attainment dates, for

each classification (sections 181-182).

The 1990 Amendments require States containing ozone nonattainment

areas classified as serious, severe, or extreme to submit several SIP

revisions, including controls to progressively reduce emissions of

ozone precursors by 9 percent over each 3-year period from 1996 through

the attainment date (the rate-of-progress (ROP), or SIP submittals),

under section 182(c)(2)(B);\1\ a demonstration of attainment (including

air quality modeling) for the nonattainment area (the attainment

demonstration), as well as SIP measures containing any additional

reductions that may be necessary to attain by the appropriate

attainment date under section 182 (c)-(e). These Act provisions

established November 15, 1994 as the required date for these SIP

submittals.\2\ On March 2, 1995, EPA Assistant Administrator for Air

and Radiation, Mary D. Nichols, sent a memorandum to EPA Regional

Administrators (Memorandum) to provide guidance on an alternative

approach to provide States with serious and above ozone nonattainment

areas flexibility in their planning efforts for the submittals due

November 15, 1994.

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\1\ These ozone nonattainment areas, as well as those classified

as moderate, were also required to submit, by November 15, 1993, a

SIP revision providing for reductions in VOC emissions of 15 percent

by November 15, 1996 under section 182(b)(1).

\2\ For ozone nonattainment areas classified as moderate, the

attainment demonstration was due November 15, 1993 (section

182(b)(1)(A)), except that if the State elected to conduct an urban

airshed model, EPA allowed an extension to November 15, 1994.

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The 1990 Amendments reflect general awareness by Congress that in

some areas of the country, ozone is not merely a local problem, but

rather is a regional problem in that ozone and its precursors can be

transported long distances across State lines to combine with ozone and

precursors downwind, thereby exacerbating the ozone problems downwind.

As a result, section 184 delineates a multistate ozone transport region

(OTR) in the Northeast part of the country, establishes the Northeast

Ozone Transport Commission (OTC) for the purpose of implementing

regionwide controls affecting all areas (including attainment areas) in

the OTR, and requires specific controls in that region.

Section 110(a)(2)(D) provides an additional tool for addressing the

problem of transport. This provision, which applies by its terms to all

SIP's for each pollutant covered by a NAAQS and for all areas

regardless of their attainment designation, provides that a SIP must

contain provisions preventing its sources from contributing

significantly to nonattainment problems downwind. Specifically, this

provision states, in relevant part, that the SIP must--

contain adequate provisions * * * prohibiting * * * any source

or other type of emissions activity within the State from emitting

any air pollutant in amounts which will--

(I) contribute significantly to nonattainment in, or interfere

with maintenance by, any other State with respect to any such

[NAAQS], or

(II) interfere with measures required to be included in the

applicable implementation plan for any other State * * * to prevent

significant deterioration of air quality or to protect visibility. *

* *

Section 110(k)(5) provides EPA with a tool for assuring that SIP's

include required controls by authorizing EPA to make a finding that a

SIP is inadequate to meet an Act requirement, thereby requiring the

State to submit, within a specified period, a SIP revision to correct

the inadequacy. Specifically, this provision, which may be termed the

SIP call provision, provides, in relevant part--

Whenever the Administrator finds that the applicable

implementation plan for any area is substantially inadequate to

attain or maintain the relevant [NAAQS], to mitigate adequately the

interstate pollutant transport described in section 176A or section

184, or to otherwise comply with any requirement of this Act, the

Administrator shall require the State to revise the plan as

necessary to correct such inadequacies. The Administrator shall

notify the State of the inadequacies, and may establish reasonable

deadlines (not to exceed 18 months after the date of such notice)

for the submission of such plan revisions.

All of the Act provisions summarized above are described in more

detail in EPA's rulemaking notices concerning low emission vehicles

(LEV) in the Northeast OTR (OTC LEV), ``Proposed Rulemaking on Ozone

Transport Commission; Emission Vehicle Program for the Northeast Ozone

Transport Region,'' 59 FR 21720 (April 26, 1994); ``Supplemental Notice

of Proposed Rulemaking on Ozone Transport Commission; Emission Vehicle

Program for the Northeast Ozone Transport Region,'' 59 FR 48664

(September 22, 1994); ``Final Rule on Ozone Transport Commission;

Emission Vehicle Program for the Northeast Ozone Transport Region,'' 60

FR 4712 (January 24, 1995).

B. State Actions and EPA Administrative Policy

Notwithstanding significant efforts, the States generally were not

able to meet the November 15, 1994 deadline for the attainment

demonstration and other SIP submissions required under section 182(c).

The March 2, 1995 Memorandum recognized the efforts made by States

and the remaining difficulties in making the ROP and attainment

demonstration SIP submittals. The Memorandum recognized that in

general, many States were unable to complete these SIP requirements

within the deadlines prescribed by the Act due to circumstances beyond

their control. These States were hampered by unavoidable delays in

developing the underlying technical information needed for the required

SIP submittals. The EPA recognized that development of the necessary

technical information, as well as the control measures necessary to

achieve the large level of reductions likely to be required, had been

particularly difficult for the States affected by ozone transport.

Accordingly, as an administrative remedial matter, the Memorandum

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indicated that EPA would establish new timeframes for SIP submittals.

The Memorandum indicated that EPA would divide the required SIP

submittals into two phases. The Phase I submittals generally consisted

of (i) SIP measures providing for ROP reductions due by the end of 1999

(the first 9 percent of ROP reductions); (ii) a SIP commitment

(sometimes referred to as an enforceable commitment) to submit any

remaining required ROP reductions on a specified schedule after 1996

(with submission no later than the end of 1999); and (iii) a SIP

commitment to submit the attainment demonstration by mid-1997, with

submission by no later than the end of 1999 of any additional rules

needed to attain. By notice dated July 10, 1996 (61 FR 36292-36295 July

10, 1996), EPA issued findings (July 1996 Findings), and thereby

started sanctions clocks, for 10 States and the District of Columbia.

The findings were made for nine nonattainment areas in those States

under the Act for failure to make complete Phase I ozone SIP submittals

as described above.

The Phase II submittals were due at specified times after 1996 and

primarily consisted of the remaining ROP SIP measures, the attainment

demonstration and additional rules needed to attain, and any regional

controls necessary for attainment by all areas in the region. The

Memorandum contemplated that regional controls needed for serious areas

to reach their 1999 attainment date would be submitted and implemented

in a timeframe consistent with that deadline, and that regional

controls needed for severe/extreme areas to attain would be submitted

by the end of 1999.

In addition, the Memorandum called for a collaborative process

among the States in the Eastern half of the country to evaluate and

address transport of ozone and its precursors. Subsequently, the OTAG

was formed, which includes representatives from States, EPA officials,

and interested members of the public, including environmental groups

and industry, to provide for an assessment of the transport problem and

the development of consensus solutions.

It is becoming increasingly apparent that some of the most highly

polluted ozone nonattainment areas will not be able to demonstrate

attainment simply through the implementation of control measures within

the nonattainment area. In some cases, significant ozone concentration

and precursor emission reductions within the upwind air mass being

transported into the nonattainment area also appear to be necessary.

C. OTAG Process

The OTAG is organized into a number of subgroups and workgroups.

The OTAG's Policy Group provides overall direction to its subgroups for

the assessment of ozone formation and transport, as well as the

development of controls strategies that will reduce concentrations of

ozone and its precursors. The Modeling and Assessment Subgroup

addresses issues relating to emissions inventories, monitoring, and

modeling. It's goal is to assess ozone transport and its impacts. The

Strategies and Controls Subgroup evaluates the availability,

effectiveness, and costs of potential national, regional and local air

pollution control strategies. The Financial Assessment and

Implementation Subgroup addresses funding and budget issues. The

Outreach and Communications Subgroup educates and informs the public

about OTAG's mission and goals, specifically the environmental benefits

of reducing the transport of ozone and its precursors. There are also

work groups that address other issues such as trading and market-based

incentives, criteria for evaluating strategies and implementation

issues.

The OTAG's first meetings were on May 18, 1995, in Reston,

Virginia, and June 19, 1995, in Washington, DC. The OTAG has continued

to meet regularly since then. The goal of OTAG is to--

Identify and recommend a strategy to reduce transported ozone

and its precursors which, in combination with other measures, will

enable attainment and maintenance of the national ambient ozone

standard in the OTAG region. A number of criteria will be used to

select the strategy including, but not limited to, cost-

effectiveness, feasibility, and impacts on ozone levels.\3\

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\3\ OTAG Policy Paper approved by the Policy Group on December

4, 1995.

In addition to sensitivity modeling analyses, OTAG is modeling

three rounds of strategies in order to have the technical information

necessary to make a recommendation to EPA on what is needed to meet the

OTAG goal. The first round of modeling was performed during September

and October 1996 and provided an initial evaluation of possible OTAG

emission reductions. The results from the sensitivity analyses and the

first round of strategy runs indicate that NOX reductions provide

benefits across State or multi-state boundaries and local disbenefits

in some urban areas. Regionwide VOC reductions provide little benefit

on a regional scale but decrease ozone in urban areas, which also may

lessen the disbenefits associated with certain NOx controls. The second

round is being performed during November and December 1996 and is

refining the emission reduction level for the strategies. The third

round will be performed during January and February 1997 and will

evaluate the geographic applicability of the OTAG strategies.

As indicated in the Memorandum, EPA envisioned that OTAG would

complete its work by the end of 1996. The modeling timetable described

above goes beyond the original schedule called for in the Memorandum.

While EPA believes that the results from the third round of modeling

runs are important, the Agency recognizes that the delay, although

relatively brief, will result in some further delay in the development

of regionwide controls based on the OTAG regional assessment.

In addition, according to the March 2, 1995 memorandum, States must

submit, by mid-1997, the Phase II submittals that include a plan for

attainment of the ozone NAAQS and any regional controls necessary for

attainment by all areas in the region. The policy contemplates that

these submittals will take account of the assessment of air quality

controls and modeling runs performed by OTAG, as well as

recommendations as to control strategies that OTAG may develop.

D. Revised Ozone NAAQS and Interim Implementation Policy

On December 13, 1996, EPA issued a notice of proposed rulemaking to

revise the ozone NAAQS (61 FR 65716), as well as set out the Interim

Implementation Policy (IIP) (61 FR 65764), which describes the SIP

requirements applicable to areas during the period from the

promulgation of a revised NAAQS to the creation of the new SIP's

required to attain the revised NAAQS. The proposal noted that a

standard set at a level of 0.09 ppm would result in approximately

equivalent public health protection as that afforded by the current

standard; a 0.08 ppm level would provide greater protection. Thus, OTAG

control strategies targeted at the reduction of boundary ozone and its

precursors would be effective and consistent with any of the proposals

for the new NAAQS.

In the proposed IIP, EPA recognized that replacing the existing

NAAQS has ramifications for the controls scheme for existing ozone

nonattainment areas. For example, the attainment dates for

nonattainment areas under the current NAAQS would be replaced by

revised attainment dates under the revised NAAQS. Also, the proposed

IIP states that nonattainment areas currently classified as serious and

higher must continue to meet the same ROP

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requirements as under the current NAAQS, which are provided by section

182(c)(2)(B), except that if the NAAQS is revised as proposed, areas

should submit ROP controls covering only the period up to the time they

submit new SIPs to attain the revised NAAQS and not up to their

attainment date under the current NAAQS. In addition, if the NAAQS is

revised as proposed, areas would not be required to submit attainment

demonstrations (including the controls) geared towards the existing

NAAQS and attainment dates; rather, they would be required at a future

time to submit an attainment demonstration geared to the revised NAAQS.

The IIP further proposes to require States to submit, within 90

days after promulgation of the final ozone NAAQS, a preliminary

estimate of the amount of emissions reductions needed for their ozone

nonattainment area to attain the revised NAAQS. Finally, the IIP

proposes making revisions to the July 1996 Findings consistent with its

principles.

II. Notice of Intent To Propose Rulemaking

In this notice, the Agency is announcing its plans to issue SIP

calls, under section 110(k)(5) of the Act, as needed to ensure that the

necessary regional reductions are achieved that will allow current

nonattainment areas to prepare attainment demonstrations for the

current NAAQS. This action will reflect the technical work done by

OTAG, as well as any OTAG recommendations for adoption of additional

NOX and/or VOC controls. The EPA wants to ensure that the

necessary regional reductions would be implemented by the relevant

States within a specified timeframe. It is EPA's intention to review

the assessments, modeling work, and any recommendations made by OTAG,

and to base the SIP call on this review as well as any other

information available. In the March 1997 timeframe, EPA intends to

publish a Notice of Proposed Rulemaking (NPR). The EPA anticipates that

the NPR will propose overall amounts or ranges of NOX and/or VOC

emission reductions that each State would need to achieve to reduce the

boundary condition concentrations of ozone and its precursors within a

specified timeframe and require the submission of SIP controls to

achieve these reductions. The EPA may or may not identify or require

specific control measures. The SIP revision must also contain a

schedule for adoption and implementation of these measures, and EPA

intends to set out this schedule in more detail in the proposed

rulemaking. The EPA intends to publish the final SIP call notice in

summer 1997.

Under section 110(k)(5) of the Act, EPA has the authority to

establish the date by which a State must respond to a SIP call. This

date can be no later than 18 months after the SIP call is issued. The

EPA believes that it is appropriate for attainment areas to meet the

same schedule as nonattainment areas for making SIP submittals. The EPA

could thus allow up to 18 months for these submittals. However, EPA is

considering a more accelerated schedule for submittals under this SIP

call to attain air quality benefits sooner and to facilitate area

specific SIP planning. The EPA will be requesting comment on deadlines

ranging from 6 months to 18 months following the date of publication of

the notice of final rulemaking.

If EPA makes a finding under section 179(a) that the appropriate

States have not made the required complete submittals by the date

established in the SIP call, EPA plans to provide by rule that the

offset sanction identified in section 179(b) will be applied in the

affected areas, pursuant to section 179(a) and 40 CFR 52.31. If the

States have still not made a complete submission 6 months after the

offset sanction is imposed, then the highway funding sanction will

apply in the affected nonattainment areas in accordance with 40 CFR

52.31. In addition, section 110(c) provides that EPA promulgate a

Federal implementation plan (FIP) no later than 2 years after a finding

under section 179(a).

The EPA believes that expedited implementation of regional control

strategies to facilitate attainment of the current standard would also

be beneficial if the Agency makes a final decision to revise the ozone

NAAQS standard. In fact, it is likely that regional reductions in ozone

and ozone precursors in upwind States will be even more critical to

allow downwind States to attain a revised standard. Regional reductions

could also minimize the number of areas designated nonattainment under

a revised standard and/or lessen the severity of the nonattainment

problem. In addition, as EPA goes through the process of developing an

implementation program for the new standard, it will be able to take

advantage of the information gathered by OTAG and account for emission

reductions that result from the recommended strategy.

The EPA's authority under section 110(k)(5) to issue a SIP call

will not be changed by promulgation of a revised NAAQS because the

requirements of section 110(a)(2)(D) will not be affected by the

revised NAAQS. Under the revised NAAQS, upwind States must continue to

demonstrate that their sources do not significantly contribute to

nonattainment problems downwind.

Dated: January 6, 1997.

Mary D. Nichols,

Assistant Administrator, Office of Air and Radiation.

[FR Doc. 97-645 Filed 1-9-97; 8:45 am]

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