[Federal Register Volume 82, Number 199 (Tuesday, October 17, 2017)]
[Rules and Regulations]
[Pages 48324-48380]
[FR Doc No: 2017-21947]

Vol. 82

Tuesday,

No. 199

October 17, 2017

Part II

Environmental Protection Agency

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40 CFR Parts 52 and 97

Promulgation of Air Quality Implementation Plans; State of Texas;
Regional Haze and Interstate Visibility Transport Federal
Implementation Plan; Final Rule

Federal Register / Vol. 82 , No. 199 / Tuesday, October 17, 2017 /
Rules and Regulations

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 52 and 97

[EPA-R06-OAR-2016-0611; FRL-9969-07-Region 6]

Promulgation of Air Quality Implementation Plans; State of Texas;
Regional Haze and Interstate Visibility Transport Federal
Implementation Plan

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: Pursuant to the Federal Clean Air Act (CAA or Act), the
Environmental Protection Agency (EPA) is finalizing a partial approval
of the 2009 Texas Regional Haze State Implementation Plan (SIP)
submission and a Federal Implementation Plan (FIP) for Texas to address
certain outstanding requirements. Specifically, the EPA is finalizing
determinations regarding best available retrofit technology (BART) for
electric generating units (EGUs) in the State of Texas. To address the
BART requirement for sulfur dioxide (SO2), the EPA is
finalizing an alternative to BART that consists of an intrastate
trading program addressing the SO2 emissions from certain
EGUs. To address the BART requirement for oxides of nitrogen
(NOX), we are finalizing our proposed determination that
Texas' participation in the Cross-State Air Pollution Rule's (CSAPR)
trading program for ozone-season NOX qualifies as an
alternative to BART. We are approving Texas' determination that its
EGUs are not subject to BART for particulate matter (PM). Finally, we
are disapproving portions of several SIP revisions submitted to satisfy
the CAA requirement to address interstate visibility transport for six
national ambient air quality standards (NAAQS): 1997 8-hour ozone, 1997
fine particulate matter (PM2.5) (annual and 24-hour), 2006
PM2.5 (24-hour), 2008 8-hour ozone, 2010 1-hour nitrogen
dioxide (NO2) and 2010 1-hour SO2. We are finding
that the BART alternatives to address SO2 and NOX
BART at Texas' EGUs meet the interstate visibility transport
requirements for these NAAQS.

DATES: This final rule is effective on November 16, 2017.

ADDRESSES: The EPA has established a docket for this action under
Docket ID No. EPA-R06-OAR-2016-0611. All documents in the docket are
listed on the http://www.regulations.gov Web site. Although listed in
the index, some information is not publicly available, e.g.,
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute therefore is not posted to
regulations.gov. Certain other material, such as copyrighted material,
is not placed on the Internet and will be publicly available only in
hard copy. Publicly available docket materials are available either
electronically through http://www.regulations.gov or in hard copy at
EPA Region 6, 1445 Ross Avenue, Suite 700, Dallas, Texas 75202-2733.

FOR FURTHER INFORMATION CONTACT: Michael Feldman at
<EMAIL_ADDRESS>or<PHONE_NUMBER>

SUPPLEMENTARY INFORMATION: Throughout this document wherever ``we,''
``us,'' or ``our'' is used, we mean the EPA.

Table of Contents

I. Background
    A. Regional Haze
    B. Interstate Transport of Pollutants That Affect Visibility
    C. Previous Actions Related to Texas Regional Haze
II. Our Proposed Actions
    A. Regional Haze
    B. Interstate Transport of Pollutants That Affect Visibility
III. Summary of Our Final Decisions
    A. Regional Haze
    1. BART-Eligible Units
    2. Subject-to-BART Sources
    3. SO2 BART
    4. PM BART
    5. NOX BART
    B. Interstate Transport of Pollutants That Affect Visibility
    C. Reasonable Progress
IV. Summary and Analysis of Major Issues Raised by Commenters
    A. Comments on Relying on CSAPR for SO2 BART or
Developing an Intrastate SO2 Trading Program
    B. Comments on Source-Specific BART
    C. Comments on EPA's Proposed SIP Disapprovals
    D. Legal Comments
    E. Comments on Identification of BART-Eligible Sources
    F. Comments on PM BART
    G. Comments on EPA's Source-Specific SO2 BART Cost
Analyses
    H. Comments on EPA's Modeling
    I. Comments on Affordability and Grid Reliability
V. SO2 Trading Program and Its Implications for
Interstate Visibility Transport, EGU BART, and Reasonable Progress
    A. Background on CSAPR as an Alternative to BART Concept
    B. Texas SO2 Trading Program
    1. Identification of Sources Participating in the Trading
Program
    2. Texas SO2 Trading Program as a BART Alternative
    C. Specific Texas SO2 Trading Program Features
VI. Final Action
VII. Statutory and Executive Order Reviews

I. Background

A. Regional Haze

    Regional haze is visibility impairment that is produced by a
multitude of sources and activities that are located across a broad
geographic area and emit PM2.5 (e.g., sulfates, nitrates,
organic carbon (OC), elemental carbon (EC), and soil dust), and its
precursors (e.g., SO2, NOX, and, in some cases,
ammonia (NH3) and volatile organic compounds (VOCs)). Fine
particle precursors react in the atmosphere to form PM2.5,
which impairs visibility by scattering and absorbing light. Visibility
impairment reduces the clarity, color, and visible distance that can be
seen. PM2.5 can also cause serious health effects and
mortality in humans and contributes to environmental effects, such as
acid deposition and eutrophication.
    Data from the existing visibility monitoring network, the
``Interagency Monitoring of Protected Visual Environments'' (IMPROVE)
monitoring network, show that visibility impairment caused by air
pollution occurs virtually all the time at most national parks and
wilderness areas. In 1999, the average visual range \1\ in many Class I
areas (i.e., national parks and memorial parks, wilderness areas, and
international parks meeting certain size criteria) in the western
United States was 100-150 kilometers, or about one-half to two-thirds
of the visual range that would exist without anthropogenic air
pollution. In most of the eastern Class I areas of the United States,
the average visual range was less than 30 kilometers, or about one-
fifth of the visual range that would exist under estimated natural
conditions.\2\ CAA programs have reduced some haze-causing pollution,
lessening some visibility impairment and resulting in partially
improved average visual ranges.\3\
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    \1\ Visual range is the greatest distance, in kilometers or
miles, at which a dark object can be viewed against the sky.
    \2\ 64 FR 35715 (July 1, 1999).
    \3\ An interactive ``story map'' depicting efforts and recent
progress by EPA and states to improve visibility at national parks
and wilderness areas may be visited at: http://arcg.is/29tAbS3.
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    CAA requirements to address the problem of visibility impairment
are continuing to be addressed and implemented. In Section 169A of the
1977 Amendments to the CAA, Congress created a program for protecting
visibility in the nation's national parks and wilderness areas. This
section of the CAA establishes as a national goal the prevention of any
future, and the remedying of any

existing man-made impairment of visibility in 156 national parks and
wilderness areas designated as mandatory Class I Federal areas.\4\ On
December 2, 1980, EPA promulgated regulations to address visibility
impairment in Class I areas that is ``reasonably attributable'' to a
single source or small group of sources, i.e., ``reasonably
attributable visibility impairment.'' \5\ These regulations represented
the first phase in addressing visibility impairment. EPA deferred
action on regional haze that emanates from a variety of sources until
monitoring, modeling, and scientific knowledge about the relationships
between pollutants and visibility impairment were improved.
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    \4\ Areas designated as mandatory Class I Federal areas consist
of National Parks exceeding 6,000 acres, wilderness areas and
national memorial parks exceeding 5,000 acres, and all international
parks that were in existence on August 7, 1977. 42 U.S.C. 7472(a).
In accordance with section 169A of the CAA, EPA, in consultation
with the Department of Interior, promulgated a list of 156 areas
where visibility is identified as an important value. 44 FR 69122
(November 30, 1979). The extent of a mandatory Class I area includes
subsequent changes in boundaries, such as park expansions. 42 U.S.C.
7472(a). Although states and tribes may designate as Class I
additional areas which they consider to have visibility as an
important value, the requirements of the visibility program set
forth in section 169A of the CAA apply only to ``mandatory Class I
Federal areas.'' Each mandatory Class I Federal area is the
responsibility of a ``Federal Land Manager.'' 42 U.S.C. 7602(i).
When we use the term ``Class I area'' in this action, we mean a
``mandatory Class I Federal area.''
    \5\ 45 FR 80084 (Dec. 2, 1980).
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    Congress added section 169B to the CAA in 1990 to address regional
haze issues, and we promulgated regulations addressing regional haze in
1999.\6\ The Regional Haze Rule revised the existing visibility
regulations to integrate into the regulations provisions addressing
regional haze impairment and established a comprehensive visibility
protection program for Class I areas. The requirements for regional
haze, found at 40 CFR 51.308 and 51.309, are included in our visibility
protection regulations at 40 CFR 51.300-51.309. The requirement to
submit a regional haze SIP applies to all 50 states, the District of
Columbia, and the Virgin Islands. States were required to submit the
first implementation plan addressing regional haze visibility
impairment no later than December 17, 2007.\7\
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    \6\ 64 FR 35714 (July 1, 1999), codified at 40 CFR part 51,
subpart P (Regional Haze Rule).
    \7\ See 40 CFR 51.308(b). EPA's regional haze regulations
require subsequent updates to the regional haze SIPs. 40 CFR
51.308(g)-(i).
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    Section 169A of the CAA directs states to evaluate the use of
retrofit controls at certain larger, often under-controlled, older
stationary sources in order to address visibility impacts from these
sources. Specifically, section 169A(b)(2)(A) of the CAA requires states
to revise their SIPs to contain such measures as may be necessary to
make reasonable progress toward the natural visibility goal, including
a requirement that certain categories of existing major stationary
sources \8\ built between 1962 and 1977 procure, install and operate
the ``Best Available Retrofit Technology'' (BART). Larger ``fossil-fuel
fired steam electric plants'' are included among the BART source
categories. Under the Regional Haze Rule, states are directed to
conduct BART determinations for ``BART-eligible'' sources that may be
anticipated to cause or contribute to any visibility impairment in a
Class I area. The evaluation of BART for EGUs that are located at
fossil-fuel-fired power plants having a generating capacity in excess
of 750 megawatts must follow the ``Guidelines for BART Determinations
Under the Regional Haze Rule'' at appendix Y to 40 CFR part 51
(hereinafter referred to as the ``BART Guidelines''). Rather than
requiring source-specific BART controls, states also have the
flexibility to adopt an emissions trading program or alternative
program as long as the alternative provides greater reasonable progress
towards improving visibility than BART. 40 CFR 51.308(e)(2) specifies
how a state must conduct the demonstration to show that an alternative
program will achieve greater reasonable progress than the installation
and operation of BART. 40 CFR 51.308(e)(2)(i)(E) requires a
determination under 40 CFR 51.308 (e)(3) or otherwise based on the
clear weight of evidence that the trading program or other alternative
measure achieves greater reasonable progress than would be achieved
through the installation and operation of BART at the covered sources.
Specific criteria for determining if an alternative measure achieves
greater reasonable progress than source-specific BART are set out in 40
CFR 51.308(e)(3). Finally, 40 CFR 51.308(e)(4) states that states
participating in CSAPR need not require BART-eligible fossil fuel-fired
steam electric plants to install, operate, and maintain BART for the
pollutant covered by CSAPR.
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    \8\ See 42 U.S.C. 7491(g)(7) (listing the set of ``major
stationary sources'' potentially subject-to-BART).
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    Under section 110(c) of the CAA, whenever we disapprove a mandatory
SIP submission in whole or in part, we are required to promulgate a FIP
within two years unless the state corrects the deficiency and we
approve the new SIP submittal.

B. Interstate Transport of Pollutants That Affect Visibility

    Section 110(a) of the CAA directs states to submit a SIP that
provides for the implementation, maintenance, and enforcement of each
NAAQS, which is commonly referred to as an infrastructure SIP. Among
other things, CAA section 110(a)(2)(D)(i)(II) requires that SIPs
contain adequate provisions to prohibit interference with measures
required to protect visibility in other states. This is referred to as
``interstate visibility transport.'' SIPs addressing interstate
visibility transport are due to the EPA within three years after the
promulgation of a new or revised NAAQS (or within such shorter period
as we may prescribe). A state's failure to submit a complete,
approvable SIP for interstate visibility transport creates an
obligation for the EPA to promulgate a FIP to address this requirement.

C. Previous Actions Related to Texas Regional Haze

    On March 31, 2009, Texas submitted a regional haze SIP to the EPA
that included reliance on Texas' participation in the Clean Air
Interstate Rule (CAIR) as an alternative to BART for SO2 and
NOX emissions from EGUs.\9\ This reliance was consistent
with the EPA's regulations at the time that Texas developed its
regional haze plan,\10\ but at the time that Texas submitted this SIP
to the EPA, the D.C. Circuit had remanded CAIR (without vacatur).\11\
The court left CAIR and our CAIR FIPs in place in order to
``temporarily preserve the environmental values covered by CAIR'' until
we could, by rulemaking, replace CAIR consistent with the court's
opinion. The EPA promulgated CSAPR, a revised multi-state trading
program to replace CAIR, in 2011 \12\ (and revised it in 2012 \13\).
CSAPR established FIP requirements for a number of states, including
Texas, to address the states' interstate transport obligation under CAA
section 110(a)(2)(D)(i)(I). CSAPR requires affected EGUs in these
states to

participate in the CSAPR trading programs and establishes emissions
budgets that apply to the EGUs' collective annual emissions of
SO2 and NOX, as well as seasonal emissions of
NOX. Following issuance of CSAPR, the EPA determined that
CSAPR would achieve greater reasonable progress towards improving
visibility than would source-specific BART in CSAPR states.\14\ We
revised the Regional Haze Rule to allow states that participate in
CSAPR to rely on participation in the trading programs in lieu of
requiring EGUs in the state to install BART controls.
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    \9\ CAIR required certain states, including Texas, to reduce
emissions of SO2 and NOX that significantly
contribute to downwind nonattainment of the 1997 NAAQS for fine
particulate matter and ozone. See 70 FR 25152 (May 12, 2005).
    \10\ See 70 FR 39104 (July 6, 2005).
    \11\ See North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008),
modified, 550 F.3d 1176 (D.C. Cir. 2008).
    \12\ 76 FR 48207 (Aug. 8, 2011).
    \13\ CSAPR was amended three times in 2011 and 2012 to add five
states to the seasonal NOX program and to increase
certain state budgets. 76 FR 80760 (December 27, 2011); 77 FR 10324
(February 21, 2012); 77 FR 34830 (June 12, 2012).
    \14\ 77 FR 33641 (June 7, 2012).
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    In the same action that EPA determined that states could rely on
CSAPR to address the BART requirements for EGUs, EPA issued a limited
disapproval of a number of states' regional haze SIPs, including the
2009 SIP submittal from Texas, due to the states' reliance on CAIR,
which had been replaced by CSAPR.\15\ The EPA did not immediately
promulgate a FIP to address the limited disapproval of Texas' regional
haze SIP in order to allow more time for the EPA to assess the
remaining elements of the 2009 Texas SIP submittal. In December 2014,
we proposed an action to address the remaining regional haze
obligations for Texas.\16\ In that action, we proposed, among other
things, to rely on CSAPR to satisfy the NOX and
SO2 BART requirements for Texas' EGUs; we also proposed to
approve the portions of the SIP addressing PM BART requirements for the
state's EGUs. Before that rule was finalized, however, the D.C. Circuit
issued a decision on a number of challenges to CSAPR, denying most
claims, but remanding the CSAPR emissions budgets of several states to
the EPA for reconsideration, including the Phase 2 SO2 and
seasonal NOX budget for Texas.\17\ Due to potential impacts
of the remanded budgets on the EPA's 2012 determination that CSAPR
would provide for greater reasonable progress than BART, we did not
finalize our decision to rely on CSAPR to satisfy the SO2
and NOX BART requirements for Texas EGUs.\18\ Additionally,
because our proposed action on the PM BART provisions for EGUs was
dependent on how SO2 and NOX BART were satisfied,
we did not take final action on the PM BART elements of Texas' regional
haze SIP. In January 2016, we finalized action on the remaining aspects
of the December 2014 proposal. That rulemaking was challenged, however,
and in December 2016, following the submittal of a request by the EPA
for a voluntary remand of the parts of the rule under challenge, the
Fifth Circuit Court of Appeals remanded the rule in its entirety.\19\
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    \15\ Id.
    \16\ 79 FR 74818 (Dec. 16, 2014).
    \17\ EME Homer City Generation, L.P. v. EPA, 795 F.3d 118, 132
(D.C. Cir. 2015).
    \18\ 81 FR 296 (Jan. 5, 2016).
    \19\ Texas v. EPA, 829 F.3d 405 (5th Cir. 2016).
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    On October 26, 2016, the EPA finalized an update to CSAPR to
address the interstate transport requirements of CAA section
110(a)(2)(D)(i)(I) with respect to the 2008 ozone NAAQS (CSAPR
Update).\20\ The EPA also responded to the D.C. Circuit's remand of
certain CSAPR seasonal NOX budgets in that action. As to
Texas, the EPA withdrew Texas's seasonal NOX budget
finalized in CSAPR to address the 1997 ozone NAAQS. However, in that
same action, the EPA promulgated a FIP with a revised seasonal
NOX budget for Texas to address the 2008 ozone NAAQS.\21\
Accordingly, Texas remains subject to the CSAPR seasonal NOX
requirements.
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    \20\ 81 FR 74504 (Oct. 26, 2016).
    \21\ 81 FR 74504, 74524-25.
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    On November 10, 2016, in response to the D.C. Circuit's remand of
Texas's CSAPR SO2 budget, we proposed to withdraw the FIP
provisions requiring EGUs in Texas to participate in the CSAPR trading
programs for annual emissions of SO2 and NOX.\22\
We also proposed to reaffirm that CSAPR continues to provide for
greater reasonable progress than BART following our actions taken to
address the D.C. Circuit's remand of several CSAPR emissions budgets.
On September 21, 2017, we finalized the withdrawal of the FIP
provisions for annual emissions of SO2 and NOX
for EGUs in Texas \23\ and affirmed our proposed finding that the EPA's
2012 analytical demonstration remains valid and that participation in
CSAPR as it now exists meets the Regional Haze Rule's criteria for an
alternative to BART.
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    \22\ 81 FR 78954.
    \23\ Texas continues to participate in CSAPR for ozone season
NOX. See final action signed September 21, 2017 available
at regulations.gov in Docket No. EPA-HQ-OAR-2016-0598.
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II. Our Proposed Actions

A. Regional Haze

    On January 4, 2017, we proposed a FIP to address the BART
requirements for Texas' EGUs. In that action, we proposed to replace
Texas' reliance on CAIR with reliance on CSAPR to address the
NOX BART requirements for EGUs.\24\ This portion of our
proposal was based on the CSAPR Update and our separate November 10,
2016 proposed finding that the EPA's actions in response to the D.C.
Circuit's remand would not adversely impact our 2012 demonstration that
participation in CSAPR meets the Regional Haze Rule's criteria for
alternatives to BART.\25\ We noted that we could not finalize this
portion of our proposed FIP unless and until we finalized our proposed
finding that the set of actions taken by the EPA in response to the
D.C. Circuit's remand of certain CSAPR budgets would not adversely
impact our prior determination that CSAPR provides for greater
reasonable progress than BART. As noted in section I.C, on September
21, 2017, we finalized our proposed finding that EPA's 2012 analytical
demonstration remains valid and that participation in CSAPR as it now
exists meets the Regional Haze Rule's criteria for an alternative to
BART.
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    \24\ 82 FR 912, 914-15 (Jan. 4, 2017).
    \25\ 81 FR 74504 (Nov. 10, 2016).
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    Also as noted in section I.C, as part of our November 10, 2016
proposed action in response to the D.C. Circuit's remand of Texas'
SO2 CSAPR budget, we also proposed to withdraw the FIP
provisions requiring EGUs in Texas to participate in the CSAPR trading
programs for annual emissions of SO2 and NOX.\26\
In our January 4, 2017 proposed action on BART requirements for Texas
EGUs, we accordingly proposed that because Texas would no longer be
participating in the CSAPR program for SO2, and thus would
no longer be eligible to rely on participation in CSAPR as an
alternative to source-specific EGU BART for SO2 under 40 CFR
51.308(e)(4), our regional haze FIP would need to include the
identification of BART-eligible EGU sources, screening of sources to
identify subject-to-BART sources, and source-by-source determinations
of SO2 BART controls as appropriate. For those EGU sources
we proposed to find subject to BART, we proposed to promulgate source-
specific SO2 requirements. We also proposed to disapprove
Texas' BART determinations for PM from EGUs. In place of these
determinations, we proposed to promulgate source-specific PM BART
requirements for EGUs that we proposed to find subject to BART.
Previously, we proposed to approve the EGU BART determinations for PM
in the Texas regional haze SIP and this proposal has never been
withdrawn.\27\ At that time, CSAPR was an appropriate alternative for
SO2 and NOX BART for EGUs. The Texas Regional
Haze SIP included a pollutant-specific screening analysis for PM to

demonstrate that Texas EGUs were not subject to BART for PM. In a 2006
guidance document,\28\ the EPA stated that pollutant-specific screening
can be appropriate where a state is relying on a BART alternative to
address both NOX and SO2 BART.
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    \26\ 81 FR 78954.
    \27\ 79 FR 74817, 74853-54 (Dec. 16, 2014).
    \28\ See discussion in Memorandum from Joseph Paisie to Kay
Prince, ``Regional Haze Regulations and Guidelines for Best
Available Retrofit Technology (BART) Determinations,'' July 19,
2006.
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B. Interstate Transport of Pollutants That Affect Visibility

    In our January 5, 2016 final action \29\ we disapproved the portion
of Texas' SIP revisions intended to address interstate visibility
transport for six NAAQS, including the 1997 8-hour ozone and 1997
PM2.5.\30\ That rulemaking was challenged, however, and in
December 2016, following the submittal of a request by the EPA for a
voluntary remand of the parts of the rule under challenge, the Fifth
Circuit Court of Appeals remanded the rule in its entirety without
vacatur.\31\ In our January 4, 2017 proposed action we proposed to
reconsider the basis of our prior disapproval of Texas' SIP revisions
addressing interstate visibility transport under CAA section
110(a)(2)(D)(i)(II) for six NAAQS. We proposed that Texas' SIP
submittals addressing interstate visibility transport for the six NAAQS
were not approvable because they relied solely on Texas' 2009 Regional
Haze SIP to ensure that emissions from Texas did not interfere with
required measures in other states. Texas' Regional Haze SIP, in turn,
relied on the implementation of CAIR as an alternative to EGU BART for
SO2 and NOX.\32\ We proposed a FIP to fully
address Texas' interstate visibility transport obligations for: (1)
1997 8-hour ozone, (2) 1997 PM2.5 (annual and 24-hour), (3)
2006 PM2.5 (24-hour), (4) 2008 8-hour ozone, (5) 2010 1-hour
NO2 and (6) 2010 1-hour SO2. The proposed FIP was
based on our finding that our proposed action to fully address the BART
requirements for Texas EGUs was adequate to ensure that emissions from
Texas do not interfere with measures to protect visibility in nearby
states in accordance with CAA section 110(a)(2)(D)(i)(II).
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    \29\ 81 FR 296 (Jan. 5, 2016).
    \30\ Specifically, we previously disapproved the relevant
portion of these Texas' SIP submittals: April 4, 2008: 1997 8-hour
Ozone, 1997 PM2.5 (24-hour and annual); May 1, 2008: 1997
8-hour Ozone, 1997 PM2.5 (24-hour and annual); November
23, 2009: 2006 24-hour PM2.5; December 7, 2012: 2010
NO2; December 13, 2012: 2008 8-hour Ozone; May 6, 2013:
2010 1-hour SO2 (Primary NAAQS). 79 FR 74818, 74821; 81
FR 296, 302.
    \31\ Texas v. EPA, 829 F.3d 405 (5th Cir. 2016).
    \32\ EME Homer City Generation, L.P. v. EPA, 795 F.3d 118, 133-
34 (D.C. Cir. 2015) (holding that SIPs based on CAIR were
unapprovable to fulfill good neighbor obligations).
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III. Summary of Our Final Decisions

A. Regional Haze

    When we finalized a limited disapproval of Texas' 2009 regional
haze SIP for its reliance on CAIR participation as a BART alternative,
we did not immediately finalize a CSAPR-better-than-BART FIP for Texas,
as we had proposed for Texas and ultimately finalized for twelve other
states. Instead of finalizing a CSAPR-better-than-BART FIP for Texas,
the EPA acknowledged that we needed more time to assess the Texas
regional haze SIP in regard to aspects other than its reliance on CAIR
as an alternative to BART.\33\ As the EPA has continued to assess how
best to address the regional haze obligations for Texas, Texas has not
submitted a SIP revision to address the prior disapproval, so the EPA
has a remaining obligation to address BART requirements for Texas EGUs.
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    \33\ 77 FR 33641, 33654 (June 7, 2012).
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    After assessing how we should address BART for Texas EGUs, we
believe that our initial 2011 proposal, to treat Texas like other
similarly situated CSAPR states, was an appropriate and regionally
consistent approach. As discussed above, in 2014, we proposed that
CSAPR would satisfy the NOX and SO2 BART
requirements for Texas EGUs.\34\ However, we did not finalize this part
of the 2014 proposal in the action taken on January 5, 2016.\35\ Given
EPA's response to the D.C. Circuit remand of certain CSAPR emission
budgets, we can no longer rely on CSAPR for Texas' SO2 BART
requirements. Based on comments we received in response to our January
2017 proposal, and giving particular weight to the views expressed by
Texas, we are finalizing various determinations to ensure satisfaction
of the BART requirement for EGUs in Texas. Of particular note, in
making our final decision for the SO2 BART requirement for
EGUs, we centered our focus on a timely comment letter received from
the Texas Commission on Environmental Quality (TCEQ) and the Public
Utility Commission of Texas (PUC). This comment urged us to consider as
a BART alternative the concept of emission caps using CSAPR
allocations. We also received similar comments from Luminant and
American Electric Power (AEP). Based upon the comments, we are
proceeding to address the SO2 BART requirement for EGUs
under a BART alternative. The EPA finds that, because this BART
alternative will result in SO2 emissions from Texas EGUs
that will be similar to emissions anticipated under CSAPR, the
alternative is an appropriate approach for addressing Texas'
SO2 BART obligations.
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    \34\ 79 FR 74817, 74823 (December 16, 2014) (``We propose to
replace Texas' reliance on CAIR to satisfy the BART requirement for
EGUs with reliance on CSAPR.''). This part of the 2014 proposal was
not finalized in the action taken on January 5, 2016, that has since
been remanded by the Fifth Circuit Court of Appeals. 81 FR 295.
    \35\ Final action taken on January 5, 2016, that has since been
remanded by the Fifth Circuit Court of Appeals. 81 FR 295.
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    Specifically, the BART alternative is justified ``based on the
clear weight of the evidence'' that the alternative achieves greater
reasonable progress than would be achieved through BART. See 40 CFR
51.308(e)(2)(i)(E). The program is designed to accomplish environmental
and visibility results by achieving emission levels that will be the
same as or better than the emission levels that would have been
obtained by state participation in the interstate CSAPR program as
finalized and amended in 2011 and 2012, which EPA first deemed to be
better than BART for NOX and SO2 in a 2012
regulatory action.\36\ The TCEQ and EPA recently signed a memorandum of
agreement (MOA) to work together to develop a SIP revision addressing
interstate visibility transport requirements and BART requirements for
EGUs with a BART alternative trading program starting from CSAPR as
allowed under the Regional Haze Rule (40 CFR 51.308(e)).\37\ Texas
envisions that the FIP measures that serve to satisfy this BART
requirement will be replaced by a future SIP submission following the
approach described in the MOA that may be approved as meeting the
requirements of the CAA and the Regional Haze Rule. EPA policy
consistently favors that states will exercise their SIP authority to
avoid need for promulgation and continued implementation of measures
under FIP authority. In the absence of a SIP to address the
SO2 BART requirement for Texas EGUs, however, EPA finds it
necessary to address the requirement under its FIP authority, and the
details of how this is addressed and the accompanying justification are
further discussed below under Section III.A.3, ``SO2 BART.''
---------------------------------------------------------------------------

    \36\ 77 FR 33641 (June 7, 2012).
    \37\ See Memorandum of Agreement Between the Texas Commission on
Environmental Quality and the Environmental Protection Agency
Regarding a State Implementation Plan to Address Certain Regional
Haze and Interstate Visibility Transport Requirements Pursuant to
Sections 110 and 169A of the Clean Air Act, Signed August 14, 2017.

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

    The Regional Haze Rule requires that SIP or FIP measures be in
place to ensure that BART is satisfied for all subject-to-BART EGUs and
all haze-causing pollutants. For ease of summarization, we will detail
the relevant final decisions for each of the haze-causing pollutants:
PM, NOX, and SO2.\38\ In our final decisions
today, the relevant BART requirement for all BART-eligible coal-fired
units and a number of BART-eligible gas- or gas/fuel oil-fired units
will be encompassed by BART alternatives for NOX and
SO2 such that we do not deem it necessary to finalize
subject-to-BART findings for these EGUs for these pollutants. The
remaining BART-eligible EGUs not covered by the SO2 BART
alternative have been determined to be not subject to BART based on the
methodologies utilizing model plants and CALPUFF modeling as described
in our proposed rule and BART Screening technical support document
(TSD). Therefore, we are approving the portion of the Texas Regional
Haze SIP that addresses the BART requirement for EGUs for PM, we are
relying upon Texas EGUs' continued participation in the CSAPR program
to serve as a BART alternative for NOX, and we are
promulgating an intrastate trading FIP to address the SO2
BART requirements for EGUs.
---------------------------------------------------------------------------

    \38\ In this action, we did not consider VOCs and ammonia among
visibility-impairing pollutants for several reasons, as discussed in
the TSD.
---------------------------------------------------------------------------

1. BART-Eligible Units
    BART-eligible sources are those sources which have the potential to
emit 250 tons per year or more of a visibility-impairing air pollutant,
which were ``in existence'' on August 7, 1977 but not ``in operation''
before August 7, 1962, and whose operations fall within one or more of
26 specifically listed source categories.\39\ As discussed in detail in
our proposal and the BART FIP TSD, our analysis of BART-eligible EGUs
started with the list of BART-eligible sources provided by TCEQ in the
2009 Texas Regional Haze SIP. Based on additional information from
potential BART-eligible sources and the U.S. Energy Information
Administration (EIA), we converted Texas' facility-specific BART-
eligible EGU list to a unit-specific BART-eligible EGU list, eliminated
those units that have retired, and verified the BART-eligibility of
each remaining unit. We noted in our proposal that Texas' list omitted
some sources that we had identified as BART-eligible. We are finalizing
the identification of BART-eligible units as proposed. A ``BART-
eligible source'' is the collection of BART-eligible units at a
facility. Table 1 shows the list of EGUs in Texas that are BART-
eligible:
---------------------------------------------------------------------------

    \39\ 40 CFR 51.301.
    \40\ Dynegy purchased the Coleto Creek power plant from Engie in
February, 2017. Note that Coleto Creek may still be listed as being
owned by Engie in some of our supporting documentation which was
prepared before that sale.

                 Table 1--Summary of BART-Eligible Units
------------------------------------------------------------------------
                  Facility                               Unit
------------------------------------------------------------------------
Barney M. Davis (Talen/Topaz)...............  1.
Big Brown (Luminant)........................  1.
Big Brown (Luminant)........................  2.
Cedar Bayou (NRG)...........................  CBY1.
Cedar Bayou (NRG)...........................  CBY2.
Coleto Creek (Dynegy \40\)..................  1.
Dansby (City of Bryan)......................  1.
Decker Creek (Austin Energy)................  1.
Decker Creek (Austin Energy)................  2.
Fayette (LCRA)..............................  1.
Fayette (LCRA)..............................  2.
Graham (Luminant)...........................  2.
Greens Bayou (NRG)..........................  5.
Handley (Exelon)............................  3.
Handley (Exelon)............................  4.
Handley (Exelon)............................  5.
Harrington Station (Xcel)...................  061B.
Harrington Station (Xcel)...................  062B.
J T Deely (CPS Energy)......................  1.
J T Deely (CPS Energy)......................  2.
Jones Station (Xcel)........................  151B.
Jones Station (Xcel)........................  152B.
Knox Lee Power Plant (AEP)..................  5.
Lake Hubbard (Luminant).....................  1.
Lake Hubbard (Luminant).....................  2.
Lewis Creek (Entergy).......................  1.
Lewis Creek (Entergy).......................  2.
Martin Lake (Luminant)......................  1.
Martin Lake (Luminant)......................  2.
Martin Lake (Luminant)......................  3.
Monticello (Luminant).......................  1.
Monticello (Luminant).......................  2.
Monticello (Luminant).......................  3.
Newman (El Paso Electric)...................  2.
Newman (El Paso Electric)...................  3.
Newman (El Paso Electric)...................  4.
Nichols Station (Xcel)......................  143B.
O W Sommers (CPS Energy)....................  1.
O W Sommers (CPS Energy)....................  2.
Plant X (Xcel)..............................  4.
Powerlane (City of Greenville)..............  ST1.
Powerlane (City of Greenville)..............  ST2.
Powerlane (City of Greenville)..............  ST3.
R W Miller (Brazos Elec. Coop)..............  1.
R W Miller (Brazos Elec. Coop)..............  2.
R W Miller (Brazos Elec. Coop)..............  3.
Sabine (Entergy)............................  2.
Sabine (Entergy)............................  3.
Sabine (Entergy)............................  4.
Sabine (Entergy)............................  5.
Sim Gideon (LCRA)...........................  1.
Sim Gideon (LCRA)...........................  2.
Sim Gideon (LCRA)...........................  3.
Spencer (City of Garland)...................  4.
Spencer (City of Garland)...................  5.
Stryker Creek (Luminant)....................  ST2.
Trinidad (Luminant).........................  6.
Ty Cooke (City of Lubbock)..................  1.
Ty Cooke (City of Lubbock)..................  2.
V H Braunig (CPS Energy)....................  1.
V H Braunig (CPS Energy)....................  2.
V H Braunig (CPS Energy)....................  3.
WA Parish (NRG).............................  WAP4.
WA Parish (NRG).............................  WAP5.
WA Parish (NRG).............................  WAP6.
Welsh Power Plant (AEP).....................  1.
Welsh Power Plant (AEP).....................  2.
Wilkes Power Plant (AEP)....................  1.
Wilkes Power Plant (AEP)....................  2.
Wilkes Power Plant (AEP)....................  3.
------------------------------------------------------------------------

2. Subject-to-BART Sources
    As discussed elsewhere, it is unnecessary to finalize the subject-
to-BART determinations for BART-eligible sources that are covered by
the BART alternatives for SO2 and NOX. The BART
alternatives cover both BART-eligible and non-BART eligible sources.
This combination provides for greater reasonable progress than source-
specific BART. Even if a unit were individually found to not be subject
to BART, its participation in the BART alternative contributes to the
finding that the program provides greater reasonable progress than
BART. We note that all BART-eligible EGUs in Texas are either covered
by the BART alternative or have screened out of being subject to BART.
The section below that discusses our final SO2 BART
determination lists those units covered by the BART alternative program
and identifies which of those units are BART-eligible. As discussed in
section III.A.4 below, we are approving the portion of the 2009 Texas
Regional Haze SIP that determined that no PM BART determinations are
needed for BART-eligible EGUs in Texas.
    For those BART-eligible EGUs that are not covered by the BART
alternative for SO2, we are finalizing determinations that
those EGUs are not subject-to-BART for NOX, SO2
and PM as proposed, based on the methodologies utilizing model plants
and CALPUFF modeling as described in our proposed rule and BART
Screening TSD.
    The following sources are determined to be BART-eligible, but not
subject-to-BART:

 Table 2--Sources Determined To Be BART-Eligible But Not Subject-to-BART
                          for NOX, SO2, and PM
------------------------------------------------------------------------
                Facility                              Units
------------------------------------------------------------------------
Barney M. Davis (Talen/Topaz)..........  1.
Cedar Bayou (NRG)......................  CBY1 & CBY2.
Dansby (City of Bryan).................  1.

Decker Creek (Austin Energy)...........  1 & 2.
Greens Bayou (NRG).....................  5.
Handley (Exelon).......................  3, 4 & 5.
Jones (Xcel)...........................  151B & 152B.
Knox Lee (AEP).........................  5.
Lake Hubbard (Luminant)................  1 & 2.
Lewis Creek (Entergy)..................  1 & 2.
Nichols Station (Xcel).................  143B.
Plant X (Xcel).........................  4.
Powerlane (City of Greenville).........  ST1, ST2 & ST3.
R W Miller (Brazos Elec. Coop).........  1, 2 & 3.
Sabine (Entergy).......................  2, 3, 4 & 5.
Sim Gideon (LCRA)......................  1, 2 & 3.
Spencer (City of Garland)..............  4 & 5.
Trinidad (Luminant)....................  6.
Ty Cooke (City of Lubbock).............  1 & 2.
V H Braunig (CPS Energy)...............  1, 2 & 3.
------------------------------------------------------------------------

3. SO2 BART
    The BART alternative will achieve SO2 emission levels
that are functionally equivalent to those projected for Texas'
participation in the original CSAPR program. The BART alternative
applies the CSAPR allowance allocations for SO2 to all BART-
eligible coal-fired EGUs, several additional coal-fired EGUs, and
several BART-eligible gas-fired and gas/fuel oil-fired EGUs. In
addition to being a sufficient alternative to BART, it secures
reductions consistent with visibility transport requirements and is
part of the long-term strategy to meet the reasonable progress
requirements of the Regional Haze Rule.
    The combination of the source coverage for this program, the total
allocations for EGUs covered by the program, and recent and foreseeable
emissions from EGUs not covered by the program will result in future
EGU emissions in Texas that are similar to the SO2 emission
levels forecast in the 2012 better-than-BART demonstration for Texas
EGU emissions assuming CSAPR participation. In line with the comment
from the TCEQ/PUC, we are finalizing a BART alternative that will
encompass the SO2 BART requirements for coal-fired EGUs and
a number of gas- and gas/fuel oil-fired EGUs under a program that will
include the sources in the following table. See Section V.B for a
discussion on identification of participating sources.

       Table 3--Texas EGUs Subject to the FIP SO2 Trading Program
------------------------------------------------------------------------
       Owner/operator                 Units             BART-eligible
------------------------------------------------------------------------
AEP.........................  Welsh Power Plant     Yes.
                               Unit 1.
                              Welsh Power Plant     Yes.
                               Unit 2.
                              Welsh Power Plant     No.
                               Unit 3.
                              H W Pirkey Power      No.
                               Plant Unit 1.
                              Wilkes Unit 1 *.....  Yes.
                              Wilkes Unit 2 *.....  Yes.
                              Wilkes Unit 3 *.....  Yes.
CPS Energy..................  JT Deely Unit 1.....  Yes.
                              JT Deely Unit 2.....  Yes.
                              Sommers Unit 1 *....  Yes.
                              Sommers Unit 2 *....  Yes.
Dynegy......................  Coleto Creek Unit 1.  Yes.
LCRA........................  Fayette/Sam Seymour   Yes.
                               Unit 1.
                              Fayette/Sam Seymour   Yes.
                               Unit 2.
Luminant....................  Big Brown Unit 1....  Yes.
                              Big Brown Unit 2....  Yes.
                              Martin Lake Unit 1..  Yes.
                              Martin Lake Unit 2..  Yes.
                              Martin Lake Unit 3..  Yes.
                              Monticello Unit 1...  Yes.
                              Monticello Unit 2...  Yes.
                              Monticello Unit 3...  Yes.
                              Sandow Unit 4.......  No.
                              Stryker ST2 *.......  Yes.
                              Graham Unit 2 *.....  Yes.
NRG.........................  Limestone Unit 1....  No.
                              Limestone Unit 2....  No.
                              WA Parish Unit WAP4   Yes.
                               *.
                              WA Parish Unit WAP5.  Yes.
                              WA Parish Unit WAP6.  Yes.
                              WA Parish Unit WAP7.  No.
Xcel........................  Tolk Station Unit     No.
                               171B.
                              Tolk Station Unit     No.
                               172B.
                              Harrington Unit 061B  Yes.
                              Harrington Unit 062B  Yes.
                              Harrington Unit 063B  No.
El Paso Electric............  Newman Unit 2 *.....  Yes.
                              Newman Unit 3 *.....  Yes.
                              Newman Unit 4 *.....  Yes.
------------------------------------------------------------------------
* Gas-fired or gas/fuel oil-fired units.

    This BART alternative includes all BART-eligible coal-fired units
in Texas, additional coal-fired EGUs, and some additional BART-eligible
gas and gas/fuel oil-fired units. Moreover, we believe that the
differences in source coverage between CSAPR and this BART alternative
are either not significant or, in fact, work to demonstrate the
relative stringency of the BART alternative as compared to CSAPR (See
Section V of this preamble for detailed information). This relative
stringency can be understood in reference to the following points:
    A. Covered sources under the BART alternative in this FIP represent
89% \41\ of all SO2 emissions from all Texas EGUs in 2016,
and approximately 85% of CSAPR allocations for existing units in Texas.
---------------------------------------------------------------------------

    \41\ In 2016, 218,291 tons of SO2 were emitted from
sources included in the program and 27,446 tons from other EGUs
(11.1%).
---------------------------------------------------------------------------

    B. The remaining 11% (100 minus 89) of 2016 emissions from sources
not covered by the BART alternative come from gas units that rarely
burn fuel oil or coal-fired units that on average are better controlled
for SO2 than the covered sources and generally are less
relevant to visibility impairment. (A fuller discussion of this point
is provided in Section V of this preamble.) As such, any shifting of
generation to non-covered sources, as might occur if a covered source
reduces its operation in order to remain within its SO2
emissions allowance allocation, would result in less emissions to
generate the same amount of electricity.
    C. Furthermore, the non-inclusion of a large number of gas-fired
units that rarely burn fuel oil reduces the amount of available
allowances for units that would typically and collectively be expected
to use only a fraction of CSAPR emissions allowances. Many of these
sources typically emit at levels much lower than their allocation
level. Sources not participating in the program may choose to opt in,
thereby increasing the number of available allowances. This will serve
to make the program more closely resemble CSAPR.
    D. The BART alternative does not allow purchasing of allowances
from out-of-state sources. Emission projections under CAIR and CSAPR
showed that Texas sources were anticipated to purchase allowances from
out-of-state sources.\42\
---------------------------------------------------------------------------

    \42\ See CAIR 2018 emission projections of approximately 350,000
tons SO2 emitted from Texas EGUs compared to CAIR budget
for Texas of 225,000 tons. See section 10 of the 2009 Texas Regional
Haze SIP.
---------------------------------------------------------------------------

    Based on these points, and borrowing to the greatest extent
possible from the rules and program design of CSAPR, but applying them
for Texas only, we are proceeding with the commenters', including the
State of Texas', suggested consideration for SO2 BART
coverage for EGUs by means of a BART alternative under an intrastate
trading program. As with any FIP, we also would welcome Texas
submitting a future SIP, as discussed in the MOA, that meets the
Regional Haze Rule and the Act's requirements so as to enable future
withdrawal of this FIP-based BART alternative.\43\
---------------------------------------------------------------------------

    \43\ See Memorandum of Agreement Between the Texas Commission on
Environmental Quality and the Environmental Protection Agency
Regarding a State Implementation Plan to Address Certain Regional
Haze and Interstate Visibility Transport Requirements Pursuant to
Sections 110 and 169A of the Clean Air Act, signed August 14, 2017.
---------------------------------------------------------------------------

    In 2014 we had originally proposed that CSAPR would satisfy the
SO2 BART requirement for Texas EGUs.\44\ Although we never
finalized that proposal, functionally, the final decision relies on
substantially the same technical elements. In contrast to the 2014
proposal, however, we are not finalizing this SO2 BART
alternative as meeting the terms of 40 CFR 51.308(e)(4), as amended,
because that regulatory provision, by its terms, provides BART coverage
for pollutants covered by the CSAPR trading program in the State but on
September 21, 2017, EPA finalized its proposed action to remove Texas
from the CSAPR SO2 trading program.\45\ Instead we are
relying on the BART alternative option provided under 40 CFR
51.308(e)(2). The BART alternative being finalized today is supported
by our determination that the clear weight of the evidence is that the
trading program achieves greater reasonable progress than BART. The
BART alternative is designed to achieve SO2 emission levels
from Texas sources similar to the SO2 emission levels that
would have been achieved under CSAPR. By a quantitative and qualitative
assessment of the operation of the BART alternative, we are able to
conclude that emission levels will be on average no greater than the
emission levels from Texas EGUs that would have been realized from the
SO2 trading program under CSAPR. (See Section V of this
preamble for detailed information). Accordingly, by the measure of
CSAPR better than BART, the SO2 BART FIP for Texas' BART-
eligible EGUs participating in the trading program will achieve greater
reasonable progress than BART with respect to SO2. BART-
eligible EGUs not participating in the program are demonstrated to not
cause or contribute to visibility impairment, and we are finalizing our
determination in this action that these units are not subject to BART.
---------------------------------------------------------------------------

    \44\ 79 FR 74817, 74823 (December 16, 2014) (``We propose to
replace Texas' reliance on CAIR to satisfy the BART requirement for
EGUs with reliance on CSAPR.''). This part of the 2014 proposal was
not finalized in the action taken on January 5, 2016, that has since
been remanded by the Fifth Circuit Court of Appeals. 81 FR 295.
    \45\ See final action signed September 21, 2017 available at
regulations.gov in Docket No. EPA-HQ-OAR-2016-0598.
---------------------------------------------------------------------------

    The Regional Haze Rule at 40 CFR 51.308(e)(2)(iii) requires that
the emission reductions from BART alternatives occur ``during the
period of the first long-term strategy for regional haze.'' The
SO2 BART alternative that EPA is finalizing here will be
implemented beginning in January 2019, and thus emission reductions
needed to meet the allowance allocations must take place by the end of
2019. For the purpose of evaluating Texas's BART alternative, the end
of the first planning period of the first long-term strategy for Texas
is 2021. This is a result of recent changes to the regional haze
regulation, revising the requirement for states to submit revisions to
their long-term strategy from 2018 to 2021.\46\ Therefore, the emission
reductions from the Texas SO2 trading program will be
realized prior to that date and within the period of Texas' first long-
term strategy for regional haze.
---------------------------------------------------------------------------

    \46\ 82 FR 3078 (Jan. 10, 2017).
---------------------------------------------------------------------------

    In promulgating the regulatory terms and rules for implementing the
BART alternative, we are mindful of the minimally required elements for
a BART alternative emissions trading program that are specified in the
provisions of 40 CFR 51.308(e)(2)(vi)(A)-(L). In general, these types
of provisions are foundational, in a generic sense, to the
establishment of allowance markets. CSAPR is a prominent example of
such an allowance market, and by transferring and generally
incorporating program rules and terms from the well-tested provisions
of CSAPR we have ensured that the BART alternative will conform in
detail and coverage to the breadth of provisions that are needed for an
emissions trading program covered by a cap (See Section V of this
preamble for additional discussion). To the extent that Texas would
submit a future SIP revision under its SIP authority to implement
SO2 BART or an SO2 BART alternative for its EGUs
as described in the MOA to meet the Regional Haze Rule and CAA
requirements, it may look to the provisions promulgated under FIP
authority or it may examine its flexibilities and the extent of its

discretion regarding essential provisions detailed at 40 CFR
51.308(e)(2)(vi).
4. PM BART
    In our January 2017 proposal, we proposed to disapprove Texas'
technical evaluation and determination that PM BART emission limits are
not required for any of Texas' EGUs. The Texas Regional Haze SIP
included a pollutant-specific screening analysis for PM to demonstrate
that Texas EGUs were not subject to BART for PM. This approach was
consistent with a 2006 guidance document \47\ in which the EPA stated
that pollutant-specific screening can be appropriate where a state is
relying on a BART alternative to address both NOX and
SO2 BART. Because we proposed to address SO2 BART
on a source-specific basis, however, Texas' pollutant-specific
screening was not appropriate and we proposed source-specific PM BART
emission limits consistent with existing practices and controls. In
this final action, we are not finalizing source-specific SO2
BART determinations. Instead, for the majority of Texas' BART-eligible
EGUs, we are relying on BART alternatives for both SO2 and
NOX emissions. Therefore, we now conclude that Texas'
pollutant-specific screening analysis was appropriate. All of the BART-
eligible sources participating in the intrastate trading program have
visibility impacts from PM alone below the subject-to-BART threshold of
0.5 deciviews (dv).\48\ Furthermore, the BART-eligible sources not
participating in the intrastate trading program screened out of BART
for all visibility impairing pollutants. As such, we are approving the
portion of the Texas Regional Haze SIP that determined that PM BART
emission limits are not required for any Texas EGUs.
---------------------------------------------------------------------------

    \47\ See discussion in Memorandum from Joseph Paisie to Kay
Prince, ``Regional Haze Regulations and Guidelines for Best
Available Retrofit Technology (BART) Determinations,'' July 19,
2006.
    \48\ Stryker Creek is covered by CSAPR for NOX and by
the SO2 trading program but was not included in the 2009
Regional Haze SIP. How Stryker Creek is screened out for PM is
discussed below.
---------------------------------------------------------------------------

    As we explained in the January 2017 proposal, the Texas Regional
Haze SIP did not evaluate PM impacts from all BART-eligible EGUs. We
have evaluated and determined this omission does not affect Texas'
conclusion that no BART-eligible EGUs should be subject-to-BART for PM
emissions. In our proposal, we identified several facilities as BART-
eligible that Texas did not identify as BART eligible in the Texas
Regional Haze SIP. Specifically, we identified the following additional
BART-eligible sources: Coleto Creek Unit 1 (Dynegy), Dansby Unit 1
(City of Bryan), Greens Bayou Unit 5 (NRG), Handley Units 3,4, and 5
(Excelon), Lake Hubbard Units 1 and 2 (Luminant), Plant X Unit 4
(Xcel), Powerlane Units ST1, ST2, and ST3 (City of Greenville), R W
Miller Units 1, 2, and 3 (Brazos Elec.), Spencer Units 4 and 5 (City of
Garland), and Stryker Creek Unit ST2 (Luminant). In our proposal, we
used CALPUFF modeling and a model-plant analysis and found that all of
these facilities except Coleto Creek and Stryker Creek had impacts from
NOX, SO2 and PM below the BART screening
level.\49\ CALPUFF modeling showed that Stryker Creek Unit ST2 had a
visibility impact of 0.786 dv from NOX, SO2 and
PM. However, Stryker Creek Unit ST2 is now covered by a BART
alternative for NOX and SO2, so we evaluated the
visibility impact of Stryker Creek Unit ST2's PM emissions alone. The
CALPUFF modeling files and spreadsheets included in our proposal
indicate that light extinction from PM (PMFine and
PMCoarse) is less than 1% of total light extinction at all
Class I areas. Therefore, because the visibility impact of PM emissions
from Stryker Creek Unit ST2 would be a small fraction of 0.786 dv
(roughly 1%), the source is not subject to BART for PM under EPA's 2006
guidance.
---------------------------------------------------------------------------

    \49\ EPA's Proposal screened out Dansby, Greens Bayou, Handley,
Lake Hubbard, Plant X, Powerlane, R W Miller, and Spencer using
CALPUFF direct modeling and Model Plants.
---------------------------------------------------------------------------

    We also evaluated the potential visibility impact of PM emissions
from Coleto Creek Unit 1 using the CAMx modeling that Texas used for PM
BART screening of its EGU sources in its SIP.\50\ Specifically, we
evaluated the modeling results for two facilities (LCRA Fayette and
Sommers Deely) with stack parameters similar to Coleto Creek's, but
which are located closer to Class I Areas than Coleto Creek. Texas
grouped the LCRA Fayette Facility in Group 2 of their PM screening
modeling along with other sources and found that their maximum
aggregate impacts at all Class I areas were less than 0.25 deciviews
(dv). Texas also explicitly modeled the City Public Service Sommers
Deely Facility's PM impacts. Maximum impacts at all Class I areas from
Sommers Deely were less than 0.32 dv. To extend these model results to
Coleto Creek, we used the Q/D ratio where Q is the maximum annual PM
emissions \51\ and D is the distance to the nearest receptor of a Class
I area. If the Q/D ratio of Coleto Creek is smaller than the ratios for
the two modeling results (Fayette and Sommers Deely) then Coleto Creek
impacts can be estimated as less than the impacts of these source(s)
and thus be screened out. We evaluated the closest Class I Areas (Big
Bend, Guadalupe Mountains, Carlsbad, Wichita Mountains, and Caney
Creek) and the Q/D ratios were: Coleto Creek (0.59-0.86), Fayette
(4.25-6.1), and Sommers Deely (6.0-10.05).\52\ The Q/D ratio for
Fayette is 6 to 8 times larger than for Coleto Creek, while the Q/D
ratio for Sommers Deely is 9 to 11.6 times higher than for Coleto
Creek. Therefore, if we were to model the PM impacts from Coleto Creek,
they would be an order of magnitude smaller than the impacts from these
facilities, which are well below the threshold of 0.5 dv. Therefore,
Coleto Creek is not subject to BART for PM emissions.
---------------------------------------------------------------------------

    \50\ Environ Report--``Final Report Screening Analysis of
Potential BART-Eligible Sources in Texas'', September 27, 2006;
``Addendum 1--BART Exemption Screening Analysis'', Draft December 6,
2006; and ``BARTmodelingparameters V2.csv''.
    \51\ This is calculated by using the maximum daily
PM10 daily emission rate, adding the maximum daily
PM2.5 emission rate and then calculating the total
emissions in tons per year if this max daily rate happened every
day.
    \52\ See `Coleto_Creek_Screen_analysis.xlsx.'
---------------------------------------------------------------------------

    In finalizing an approval of Texas' determinations regarding PM
BART, we offer one additional note. We originally proposed to approve
Texas' screening approach in 2014,\53\ and our final action today
essentially conforms to our technical evaluation in that proposal.
---------------------------------------------------------------------------

    \53\ See 79 FR 74817, 74848 (Dec. 16, 2014).
---------------------------------------------------------------------------

5. NOX BART
    We are finalizing our proposed determination that Texas EGUs'
continued participation in the CSAPR program for interstate transport
for ozone will serve as a BART alternative for NOX for EGUs
in the State of Texas. Our action to address NOX BART for
EGUs as it applies to Texas is based on two other recent rulemakings
concerning CSAPR. The first is the rulemaking to update CSAPR to
address interstate transport of ozone pollution with respect to the
2008 ozone NAAQS, which established a new ozone season budget for
NOX emissions in Texas.\54\ The second is the determination
that CSAPR continues to be a better than BART alternative, on a
pollutant specific basis, for states that participate in the CSAPR
program as it now exists.\55\ Because our FIP relies on CSAPR as a BART
alternative for NOX for Texas EGUs, we are not required in
this action to promulgate source-specific

NOX BART determinations for those sources.
---------------------------------------------------------------------------

    \54\ 81 FR 74504 (Oct. 16, 2016).
    \55\ See final action signed September 21, 2017 available at
regulations.gov in Docket No. EPA-HQ-OAR-2016-0598.
---------------------------------------------------------------------------

    We note that Texas may opt to use its SIP planning authority, as
was noted in its 2009 Regional Haze SIP in a similar context, to
address the NOX BART requirement for EGUs without relying on
CSAPR. If Texas instead wishes to rely upon the CSAPR program to
address the NOX BART requirement, it may submit a SIP
revision to establish its reliance on the program to satisfy the
requirement for NOX BART for EGUs. By using the SIP pathway,
Texas would be exercising the primary responsibility for air pollution
control that is embodied in the Act. See CAA section 101(a)(3).
Recognizing that the 2009 Regional Haze SIP did not, by its terms,
provide an approvable means to address the requirement, however, we are
now required to exercise our FIP authority to address it.\56\ We are
therefore finalizing the determination as proposed.
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    \56\ As explained in our proposal, our ongoing authority and
obligation to address the NOX BART requirement for Texas
EGUs under CAA section 110(c) traces to EPA's limited disapproval of
the 2009 Texas Regional Haze SIP in 2012 due to the State's reliance
on the remanded and replaced CAIR as an alternative to
NOX BART. See also EME Homer City Generation, L.P. v.
EPA, 795 F.3d 118, 133-34 (D.C. Cir. 2015) holding that SIPs based
on CAIR were unapprovable to fulfill good neighbor obligations.
---------------------------------------------------------------------------

B. Interstate Transport of Pollutants That Affect Visibility

    We are finalizing our proposal to disapprove Texas' SIP revisions
addressing interstate visibility transport under CAA section
110(a)(2)(D)(i)(II) for six NAAQS. As explained further in our
proposal, Texas' infrastructure SIPs for these six NAAQS relied on the
2009 Regional Haze SIP, including its reliance on CAIR as an
alternative to EGU BART for SO2 and NOX to meet
the interstate visibility transport requirements.\57\ We are finalizing
a FIP to fully address Texas' interstate visibility transport
obligations for the following six NAAQS: (1) 1997 8-hour ozone, (2)
1997 PM2.5 (annual and 24 hour), (3) 2006 PM2.5
(24-hour), (4) 2008 8-hour ozone, (5) 2010 1-hour NO2 and
(6) 2010 1-hour SO2.
---------------------------------------------------------------------------

    \57\ 82 FR 912, 916 (Jan. 4, 2017).
---------------------------------------------------------------------------

    An EPA guidance document (2013 Guidance) on infrastructure SIP
elements states that CAA section 110(a)(2)(D)(i)(II)'s interstate
visibility transport requirements can be satisfied by approved SIP
provisions that the EPA has found to adequately address a state's
contribution to visibility impairment in other states.\58\ The EPA
interprets interstate visibility transport to be pollutant-specific,
such that the infrastructure SIP submission need only address the
potential for interference with protection of visibility caused by the
pollutant (including precursors) to which the new or revised NAAQS
applies.\59\ The 2013 Guidance lays out two ways in which a state's
infrastructure SIP submittal may satisfy interstate visibility
transport. One way is through a state's confirmation in its
infrastructure SIP submittal that it has an EPA approved regional haze
SIP in place. In the absence of a fully approved regional haze SIP, a
demonstration that emissions within a state's jurisdiction do not
interfere with other states' plans to protect visibility meets this
requirement. Such a demonstration should point to measures that limit
visibility-impairing pollutants and ensure that the resulting
reductions conform with any mutually agreed emission reductions under
the relevant regional haze regional planning organization (RPO)
process.\60\
---------------------------------------------------------------------------

    \58\ See ``Guidance on Infrastructure State Implementation Plan
(SIP) Elements under Clean Air Act Sections 110(a)(1) and (2)''
included in the docket for this action.
    \59\ See Id., at 33.
    \60\ See Id., at 34, and 76 FR 22036 (April 20, 2011) containing
EPA's approval of the visibility requirement of 110(a)(2)(D)(i)(II)
based on a demonstration by Colorado that did not rely on the
Colorado Regional Haze SIP.
---------------------------------------------------------------------------

    To develop its 2009 Regional Haze SIP, TCEQ worked through its RPO,
the Central Regional Air Planning Association (CENRAP), to develop
strategies to address regional haze, which at that time were based on
emissions reductions from CAIR. To help states in establishing
reasonable progress goals for improving visibility in Class I areas,
the CENRAP modeled future visibility conditions based on the mutually
agreed emissions reductions from each state. The CENRAP states then
relied on this modeling in setting their respective reasonable progress
goals.
    This FIP is adequate to ensure that emissions from Texas do not
interfere with measures to protect visibility in nearby states because
the BART FIP emission reductions are consistent with the level of
emissions reductions relied upon by other states during consultation.
The 2009 Texas Regional Haze SIP relied on CAIR to meet SO2
and NOX BART requirements. Under CAIR, Texas EGU sources
were projected to emit approximately 350,000 tpy of SO2. As
discussed elsewhere, Texas EGU emissions for sources covered by the
trading program will be constrained by the number of available
allowances. Average annual emissions for the covered sources will be
less than or equal to 248,393 tons with some year to year variability
constrained by the number of banked allowances and number of allowances
that can be allocated in a control period from the supplemental pool.
Sources not covered by the program emitted less than 27,500 tons of
SO2 in 2016 and are not projected to significantly increase
from this level. Any new units would be required to be well controlled
and similar to the existing units not covered by the program, they
would not significantly increase total emissions of SO2.
Additionally, this FIP relies on CSAPR as an alternative to EGU BART
for NOX, which exceeds the emissions reductions relied upon
by other states during consultation. As such, this BART FIP is
sufficient to address the interstate visibility transport requirement
under CAA section 110(a)(2)(D)(i)(II) for the six NAAQS.

C. Reasonable Progress

    This final action is part of the long-term strategy for Texas and
will contribute to making reasonable progress toward natural visibility
conditions at Texas' and downwind Class I areas. However, the EPA is
not determining at this time that this final action fully resolves the
EPA's outstanding obligations with respect to reasonable progress that
resulted from the Fifth Circuit's remand of our reasonable progress
FIP. We intend to take future action to address the Fifth Circuit's
remand.

IV. Summary and Analysis of Major Issues Raised by Commenters

    We received both written and oral comments at the public hearings
we held in Austin. We also received comments by the internet and the
mail. The full text of comments received from these commenters, except
what was claimed as CBI, is included in the publicly posted docket
associated with this action at www.regulations.gov. The CBI cannot be
posted to www.regulations.gov, but is part of the record of this
action. We reviewed all public comments that we received on the
proposed action. Below we provide a summary of certain comments and our
responses. First, we provide a summary of all of the relevant technical
comments we received and our responses to these comments. We do not
consider some of the technical comments as relevant to the final
action. For these comments we provide a brief summary of the comments
and a discussion as to why they are not relevant. Second, we provide a
summary below of the more significant legal comments with a summary of
our responses. All of the legal comments we received that are relevant
to our final

action are found in a separate document, titled the Legal Response To
Comments (RTC) document. Therefore, if additional information is
desired concerning how we addressed a particular legal comment, the
reader should refer to the Legal RTC document. Third, we provide a
summary of the more significant/relevant modeling related comments with
a summary of our responses. The entirety of the modeling comments and
our responses thereto are contained in a separate document titled the
Modeling RTC document.

A. Comments on Relying on CSAPR for SO2 BART or Developing an
Intrastate SO2 Trading Program

    Comment: We received comments from TCEQ that our proposed
SO2 controls for the coal-fired power plants represents more
control than is necessary to satisfy BART. The EPA should consider an
alternate control approach for these BART-affected units using source
or system caps. Because the CSAPR level of control is better than BART,
the EPA should have considered an equivalent control level in its BART
analysis. For example, a potential alternative is the concept of
system-wide emission caps using CSAPR allocations. A SO2
system-cap approach for BART would be based on establishing a cap on
all the BART subject units under common ownership and control based on
CSAPR allocations to those specific units. System-wide caps for these
BART subject units based on CSAPR allocations would provide flexibility
while actually being more stringent than CSAPR because the companies
would not have the ability to trade allocations with non-BART
facilities or with companies in other states. Furthermore, the EPA has
approved system-cap approaches under the TCEQ's Chapter 117 rules for
NOX. If such an approach using CSAPR allocations or some
other similar variation can be demonstrated to be more stringent than
CSAPR itself, then the EPA's CSAPR-is-better-than-BART determination
should satisfy some of the demonstration requirements for BART
alternatives. Even if not based on CSAPR allocations, the EPA should
consider a source-cap or system cap approach as an alternative to unit-
by-unit rate-based standards. Source and system cap strategies achieve
equivalent reductions by setting mass-based limits (e.g., ton per day)
for a group of units derived from rate-based standards and baseline
levels of activity for the units. In this context, the rate-based
standards used to set the caps would be the emission rates determined
to represent BART. These types of cap approaches allow companies to
consider a broader range of alternative strategies. Under a FIP with
only unit-by-unit rate-based limits, as proposed by EPA, such an
alternative strategy would not be allowed and EPA would have to revise
its FIP to allow the company to pursue the alternative. A similar
approach using system-caps would provide additional flexibility for
companies. If the EPA is averse to creating a system-cap trading
program for a single state, an alternative would be to allow for a
state system-cap trading program that would allow companies to trade
between systems once the EPA has approved the state program.
    We received a comment from American Electric Power (AEP) stating
that in the proposed Texas BART FIP, EPA states that it encourages
Texas to consider adopting SIP provisions that would allow EPA to fully
approve the Regional Haze SIP with respect to Regional Haze and
Interstate Visibility Transport. AEP also suggests that alternatively,
Texas may also elect to satisfy its obligations by demonstrating an
alternative. Although AEP views the most expeditious resolution for
satisfying BART is finalization of CSAPR as a better-than-BART
alternative, AEP would also welcome and support working with the State
and EPA to develop a satisfactory BART compliance alternative. For
example, AEP is open to consideration of a cap and trade program or
other option for BART compliance. AEP is prepared to engage in such
discussions as soon as possible.
    We also received a comment from Luminant stating that the EPA can
and should address BART for Texas, not through EPA-mandated controls on
individual units but through one of several available BART alternatives
that will ensure equivalent or greater benefits at far less costs, as
demonstrated by EPA's own prior analyses of Texas EGUs' emissions.
Among those available alternatives is EPA's original proposed BART plan
for EGUs in Texas--reliance on Texas EGUs' participation in the CSAPR
annual SO2 and NOX trading programs as BART
compliance. Since CSAPR became effective in 2015, SO2
emissions from Texas EGUs have declined substantially and are well
below the levels that EPA previously determined are ``better-than-
BART.'' EPA itself calculated ``major visibility improvements at Class
I areas in and around Texas'' from the CSAPR-for-BART alternative for
Texas. The CSAPR-for-BART alternative remains the most expeditious and
cost effective path for finalizing a BART solution for Texas EGUs.
Indeed, EPA's only lawful path forward to finalize a BART FIP for Texas
by the current September 9, 2017 deadline in EPA's consent decree with
Sierra Club is to finalize a CSAPR-for-BART FIP for Texas EGUs, as EPA
proposed to do in December 2014. That proposal was not withdrawn,
remains a valid and defensible alternative, is supported by the record
and prior EPA technical analyses, and has been fully vetted with
substantial public review and comments.
    Response: Due to these comments requesting a BART alternative in
lieu of source-specific EGU BART, we are finalizing an intrastate
SO2 trading program as an alternative to source-by-source
BART and to meet the interstate visibility transport requirements. This
program will provide the commenters, and other owners of covered EGUs,
with many of the benefits that they attributed to CSAPR. The premise in
the comment that Texas EGUs are subject to CSAPR's SO2
trading program is no longer true, given our recent action to remove
Texas from that trading program.\61\ Hence, we cannot take the
commenter's recommended action of addressing SO2 BART
through reliance on CSAPR.
---------------------------------------------------------------------------

    \61\ See final action signed September 21, 2017 available at
regulations.gov in Docket No. EPA-HQ-OAR-2016-0598.
---------------------------------------------------------------------------

B. Comments on Source-Specific BART

    Comment: We received a number of comments in favor or against our
proposals regarding BART-eligibility status, subject-to-BART status,
and source-specific BART technologies and emission limits. Some were
general and some were very specific.
    Response: Due to the comments we received requesting a BART
alternative in lieu of source-specific BART determinations, we are
finalizing an intrastate SO2 trading program as an
alternative to source-by-source BART and to meet the interstate
visibility transport requirements. As a consequence, we believe that it
is not necessary to respond to comments concerning the merits of the
proposed source-specific BART technologies and emission limits.
Comments related to BART-eligibility status and subject-to-BART status
are addressed elsewhere in this preamble.

C. Comments on EPA's Proposed SIP Disapprovals

    Comment: The root of EPA's flawed proposal is EPA's departure from
the cooperative federalism principles underlying the Clean Air Act. The
State of Texas developed its regional haze SIP

after years of work, technical analysis, and coordination with other
States. For BART, Texas relied on the participation of Texas EGUs in
CAIR and EPA's determination that CAIR was better-than-BART. EPA should
have approved Texas's SIP at the time because it complied with all
statutory requirements and was supported by EPA's own modeling. In no
way does the Proposed Texas BART FIP--which starts over from scratch
and creates an entirely new approach to BART for Texas EGUs--respect
the State's primary role under the statute. At a minimum, to more
closely align with the State of Texas's original choice to meet BART
through a regional trading program, EPA should now finalize its prior
proposal that CSAPR serve as a complete BART alternative for Texas
EGUs.
    Response: Our action in 2012 to disapprove Texas' 2009 SIP
submission due to its reliance on CAIR is not the subject of this
rulemaking and we do not address here the comment opposing that final
action. We agree that CSAPR continues to be available on a pollutant-
specific basis as a BART alternative for participating states for those
pollutants subject to trading by CSAPR program participation; hence, we
are finalizing a determination that CSAPR is better than BART for
NOX at Texas EGUs. However, the premise in the comment that
Texas EGUs are subject to CSAPR's SO2 trading program is no
longer true, given our recent action to remove them from that trading
program.\62\ Hence, we cannot take the specific action recommended in
this comment. Due to these comments requesting a BART alternative in
lieu of source-specific EGU BART determinations, we are, however,
finalizing a SO2 trading program as an alternative to
source-by-source BART and as meeting the interstate visibility
requirements.
---------------------------------------------------------------------------

    \62\ See final action signed September 21, 2017 available at
regulations.gov in Docket No. EPA-HQ-OAR-2016-0598.
---------------------------------------------------------------------------

D. Legal Comments

    We received comments addressing EPA's authority to promulgate a
Federal Implementation Plan (FIP), the use of CSAPR as a better-than-
BART alternative, cooperative federalism, deference to the State, the
new Administration's policies, Executive Orders, and litigation. These
comments, and the response to comments, can be found in the document
titled Legal RTC in the docket for this action. Below is a summary of
some of the more significant comments we received. For a detailed
review of all legal comments and responses, we refer the reader to this
separate document.
1. EPA's Obligation and Authority To Promulgate a FIP
    Comment: Texas' and industry's challenge to CSAPR does not relieve
EPA of its mandatory duty to issue a source-specific BART FIP for
Texas. Although EPA would have permitted Texas to rely on CSAPR's
modest cap-and-trade program to avoid source-specific BART controls,
Texas, Luminant, AEP, and Southwestern Public Service Company all chose
to challenge CSAPR. They were ultimately successful in defeating EPA's
inclusion of Texas in the program for SO2 and ozone-season
NOX. Ever since the D.C. Circuit remanded the Texas
NOX and SO2 budgets to EPA in July 2015, Texas
has been on notice that source-specific BART could well be necessary to
meet its BART obligations. Yet Texas has not put forward either a new
interstate transport SIP to replace CSAPR or a new BART SIP to address
the Regional Haze Rule.
    Response: We agree that we have a mandatory duty to address the
BART requirements for Texas EGUs but we do not agree that we must
address these requirements through a FIP establishing source specific
BART limits. We understand the comment to be referencing the court
action, EME Homer City Generation v. EPA, 795 F.3d 118 (D.C. Cir., July
28, 2015). At all times since the original submission of the 2009
Regional Haze SIP, Texas has been entitled to submit updated or new SIP
revisions to address BART or interstate transport. A State is also
entitled to submit a SIP that may be approved to replace a FIP after a
FIP's promulgation. When and whether Texas has been ``on notice''
regarding a potential need for source-specific BART is not material to
the present need to address the EGU BART requirements through either a
SIP or FIP. We do note that the 2009 Regional Haze SIP stated, ``The
TCEQ will take appropriate action if CAIR is not replaced with a system
that the US EPA considers to be equivalent to BART.'' See 2009 SIP at
9-1. The 2009 SIP further acknowledged, ``Some EGUs may become subject
to BART pending resolution of the CAIR at the federal level.'' See 2009
SIP at 9-17. As circumstances now apply to Texas (and, as this comment
suggests, may have been earlier projected), the State can take
appropriate action to develop a SIP to address the EGU BART and
interstate visibility transport requirements. The TCEQ and EPA recently
signed a MOA to work together to develop a SIP revision addressing
interstate visibility transport requirements and BART requirements for
EGUs with a BART alternative trading program starting from CSAPR.\63\
However, without such a SIP, the Clean Air Act requires a promulgation
of a FIP to address the outstanding BART and interstate transport
requirements.
---------------------------------------------------------------------------

    \63\ See Memorandum of Agreement Between the Texas Commission on
Environmental Quality and the Environmental Protection Agency
Regarding a State Implementation Plan to Address Certain Regional
Haze and Interstate Visibility Transport Requirements Pursuant to
Sections 110 and 169A of the Clean Air Act, Signed August 14, 2017.
---------------------------------------------------------------------------

    Comment: Texas's decision to not meet the BART requirements for its
EGUs through voluntary participation in CSAPR does not relieve EPA of
its mandatory duty to issue a source-specific BART FIP for Texas. Even
if Texas were willing to voluntarily incorporate EPA's invalidated
CSAPR emission budgets into its SIP, the state cannot simply opt in and
avoid source-specific BART. Because Texas cannot reverse course and
adopt emissions budgets that it demonstrated were unnecessary, as a
matter of law, and because the agency cannot achieve ``all'' of the
CSAPR reductions by 2018 (the end of the first planning period), it
cannot voluntarily adopt CSAPR.
    Response: We agree that we have a mandatory duty to address the
BART requirement for Texas EGUs, but we do not agree that we must
address it through a source-specific BART FIP. We understand this
comment to refer to a hypothetical scenario based on the development
and submission of a SIP by Texas providing for voluntary participation
in CSAPR as a means of addressing the SO2 and/or
NOX BART requirements for Texas EGUs. The possibility of
such an option was detailed in a June 27, 2016 memorandum entitled,
``The U.S. Environmental Protection Agency's Plan for Responding to the
Remand of the Cross-State Air Pollution Rule Phase 2 SO2
Budgets for Alabama, Georgia, South Carolina and Texas.'' That
memorandum was provided and available to Texas and other states.
Several other states have pursued this option, but Texas has not, and
it is not within the scope of our proposal. We are not opining on the
operation of state law or otherwise responding to this comment. We
address the issue of whether emission reductions from a BART
alternative must be achieved by 2018 in our response to another
comment.
    Comment: EPA withdrawal of Texas from CSAPR does not relieve EPA of
its mandatory duty to issue a source-specific BART FIP for Texas. After

having given Texas four months' notice of its intent to fully withdraw
the state from the CSAPR program, and made clear the implication that
there would no longer be any doubt that Texas sources would need to
comply with source-specific BART obligations, EPA formally issued its
proposal to withdraw its federal plan to include Texas in the CSAPR
emissions trading program one month before issuing the BART proposal.
81 FR 78954 (Nov. 10, 2016). EPA again made clear the situation: ``[I]f
and when this [CSAPR withdrawal] proposal is finalized, Texas will no
longer be eligible to rely on CSAPR participation as an alternative to
certain regional haze obligations including the determination and
application of source-specific SO2 BART. Any such remaining
obligations are not addressed in this proposed action and would be
addressed through other state implementation plan (SIP) or FIP actions
as appropriate.'' Id. at 78,956. EPA has informed the U.S. District
Court for the District of Columbia that it intends to finalize this
proposal by October 31, 2017.
    After challenging the state's inclusion in CSAPR for years,
industry has done an about face in response to EPA's Texas BART
Proposal and now opposes EPA's withdrawal of Texas from CSAPR. But EPA
has gone on record that the agency does not currently have an
analytical basis to support new CSAPR budgets for Texas. As EPA has
noted, there was no such thing as a legally compliant CSAPR budget for
Texas following the remand. Texas has had many years to submit a state
SIP equivalent to CSAPR or other BART alternative to avoid source-
specific BART, but Texas has taken no action to address its
contribution to interstate pollution or regional haze.
    Response: We agree that we have a mandatory duty to address the
BART requirement for Texas EGUs, but we do not agree that we must
address it through a source-specific BART FIP. We also have a mandatory
duty to address the interstate visibility transport requirements.
    Comment: We have strongly opposed the CSAPR-Better-than-BART rule
since its inception. It is unlawful and unsupported by the scientific
record. Legal challenges to EPA's rule which purports to authorize
reliance on CSAPR to satisfy BART are currently pending in the D.C.
Circuit Court of Appeals. Until the D.C. Circuit rules on the validity
of the CSAPR-Better-than-BART rule, neither EPA nor Texas should assume
that CSAPR is an appropriate substitute for BART.
    Response: The legal and technical determinations of the CSAPR-
Better-than-BART rule are subject to judicial review under existing
challenges and a separate administrative record, as indicated by the
comment. Any challenges raised with regard to the present rulemaking
and outside that litigation may be time-barred or directed to the wrong
forum. As such, we do not believe that the incorporation of arguments
from a brief filed with the D.C. Circuit concerning a separate
regulatory determination warrants responses here, in this rulemaking,
and that to offer responses here would suggest some basis for
collateral, time-barred arguments that are out of the scope of this
action.
    Comment: In addition to the legal uncertainty surrounding the
national CSAPR-Better-than-BART rule, it is too late for Texas to rely
on a BART alternative like CSAPR or any other program. Under EPA's
Regional Haze Rule, any BART alternative must include a ``requirement
that all necessary emission reductions take place during the period of
the first long-term strategy for regional haze''--i.e., no later than
2018. There are no plans in place, or even in development, for any
federal or state program that would ensure the necessary reductions
take place by the end of the first planning period in 2018.
    With the exception of a BART alternative approved for the Navajo
Generating Station, which relied on the Tribal Authority Rule to
provide additional flexibility, EPA has never proposed or approved a
BART alternative that would allow the necessary emission reductions to
be delayed past 2018. In Texas v. EPA, 829 F.3d 405 (5th Cir. 2016),
Texas and industry persuaded the Fifth Circuit of a likelihood that EPA
could not require controls beyond the first planning period for
reasonable progress. While neither the statute nor regulation precludes
emission reductions relative to reasonable progress requirements to
occur beyond the planning period deadline, the BART alternative
requirements contain a provision directly on point. Accordingly,
emission reductions under a BART alternative must be implemented by the
end of the first planning period.
    Response: The Regional Haze Rule at 40 CFR 51.308(e)(2)(iii)
requires that the emission reductions from BART alternatives occur
``during the period of the first long-term strategy for regional
haze.'' The SO2 BART alternative that EPA is finalizing here
will be implemented beginning in January 2019, and thus emission
reductions needed to meet the allowance allocations must take place by
the end of 2019. For the purpose of evaluating Texas's BART
alternative, the end of the first planning period of the first long-
term strategy for Texas is 2021. This is a result of recent changes to
the regional haze regulation, revising the requirement for states to
submit revisions to their long-term strategy from 2018 to 2021.\64\
Therefore, the emission reductions from the Texas SO2
trading program will be realized prior to that date and within the
period of Texas' first long-term strategy for regional haze. Moreover,
we expect that source owners in 2018 will already be taking steps,
including appropriate source-level compliance planning (e.g., purchase
contracts for coal), to be ready for the compliance year beginning on
January 1, 2019. Adding to this, the State has already experienced
reductions in SO2 emissions in response to market conditions
and, to some extent, periods of compliance with CSAPR, including its
allocations for SO2, when those measures were in effect or
otherwise part of source owner planning considerations.
---------------------------------------------------------------------------

    \64\ 82 FR 3078 (Jan. 10, 2017).
---------------------------------------------------------------------------

    We note that the BART alternative is projected to be implemented
before any of the earlier-proposed compliance dates for source-specific
SO2 BART for coal-fired units.
    The last year for which Texas EGUs must meet CSAPR requirements for
SO2 is 2016. We considered and decided not to make the Texas
SO2 trading program effective for 2017 because that would be
unreasonably short notice to the affected EGUs in light of the late
date in 2017 on which this action will become effective. We considered
and decided not to make the program effective for 2018 because that
also would be unreasonably short notice given that affected EGU owners
should be allowed more than a few months to determine their strategy
for compliance with the program in light of it having some features
that are different from the CSAPR trading program they have been
operating under until recently, for example the fact that they will no
longer be able to purchase and use allowances from out-of-state EGUs.
    Comment: Adopting an emissions trading program for Texas that
allows anywhere close to the tonnage of SO2 permitted by the
emissions caps in CSAPR would also fail to meet the substantive
requirements for a BART alternative. While the D.C. Circuit is
considering whether CSAPR meets these substantive requirements in the
CSAPR-Better-than-BART litigation, Texas's situation is unique in that
EPA has

actually completed a source-specific BART proposal that can be directly
compared with the CSAPR program. Thus, even if the CSAPR-Better-than-
BART rule is upheld as a national rule that EPA has the option of
relying upon in certain states, and even if Texas were to join CSAPR or
voluntarily adopt its budgets, it would be arbitrary for EPA to rely on
CSAPR as a BART alternative without actually comparing the CSAPR or
CSAPR-like program with its BART proposal. When comparing the two head-
to-head, it is obvious as a practical matter that allowing Texas's
coal-fired power fleet to essentially continue emitting the same levels
of SO2 as the status quo is not going to achieve equivalent
visibility gains as the BART proposal would. As detailed in ``EPA's
Fact Sheet for the Open House on EPA's Clean Air Plan Proposal for
Texas Regional Haze'', the proposed BART limits are expected to reduce
emissions of SO2 from 16 EGUs and would cut emissions from
approximately 89 to 98 percent--a reduction of over 194,000 tons of
SO2 every year.
    To satisfy the requirements for a BART ``alternative,'' an
emissions trading program must make a technical demonstration that the
trading program ``will achieve greater reasonable progress [towards
natural visibility] than would have resulted from the installation and
operation of BART at all sources subject to BART.'' Id. Sec.
51.308(e)(2)(i). Under EPA's regulations, if the distribution of
emissions is different under an alternative program, a state ``must
conduct dispersion modeling'' to determine differences in visibility
between BART and the trading program for each impacted Class I area,
for the worst and best 20 percent of days. The modeling only
demonstrates ``greater reasonable progress'' if both of the following
two criteria are met: (i) Visibility does not decline in any Class I
area, and (ii) There is an overall improvement in visibility,
determined by comparing the average differences between BART and the
alternative over all affected Class I areas. Id. Sec.  51.308(e)(3).
    Response: The comment addresses the approvability of a hypothetical
SIP offered to meet the requirements of 40 CFR 51.308(e)(2). First, we
do not agree with the premise of the comment that merely proposed
determinations of BART in the context of a possible FIP set a
stringency threshold for a demonstration set forth in a hypothetical
SIP. Proposed determinations are only proposals and the facts put forth
to support those proposals are themselves subject to correction via
public comment and new information. Second, we also do not agree with
any extension of the commenter's assertion to a FIP. While the comment
does not address all the pertinent requirements for a BART alternative,
we have done so elsewhere in this preamble. For example, as allowed by
the requirements for a BART alternative in Sec.  51.308(e)(2)(i)(C), we
are declining to conduct the analysis that would include making
determinations of BART for each source subject to BART and we are
instead exercising the exception allowed when the alternative measure
``has been designed to meet a requirement other than BART (such as the
core requirement to have a long-term strategy to achieve the reasonable
progress goals established by States).'' \65\ Third, we disagree that
51.308(e)(3) applies to this action. Rather, we find justification for
the BART alternative under the ``clear weight of the evidence'' that
the trading program will provide greater reasonable progress than would
be achieved through the installation and operation of BART at the
covered sources. This means of validating a BART alternative, described
by one Court as the ``catch-all,'' is permitted by 40 CFR
51.308(e)(2)(i)(E). We are allowed but not required to validate the
BART alternative under the test set out in 40 CFR 51.308(e)(3).
Although we are not applying that test here, we believe this intrastate
trading program meets the intent of (e)(3). When promulgating the 2012
CSAPR-Better-than-BART rule, the EPA relied on an analysis showing that
CSAPR would result in greater reasonable progress than BART under the
test in 40 CFR 51.308(e)(3). In this action we are relying, in part, on
that demonstration to show that the clear weight of evidence
demonstrates that the SO2 Trading Program will provide for
greater reasonable progress than BART in Texas. This is based on a
showing that the emissions in Texas under the BART alternative will be
on average no greater than the emission levels from Texas EGUs that was
forecast in the demonstration for Texas EGU emissions assuming CSAPR
participation.
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    \65\ See 40 CFR 51.308(e)(2)(i)(C).
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2. Statutory or Regulatory Text
    Comment: A state should be able to independently rely on EPA's
CSAPR-is-better-than-BART determination if the state can demonstrate
that a state-only program for EGUs is more stringent than CSAPR. While
the TCEQ has not proposed any action to implement a Texas-only program
for EGUs based in some way on CSAPR as a means of satisfying BART, and
these comments in no way represent a commitment to propose such an
action, the TCEQ should be able to rely on the EPA's CSAPR-is-better-
than-BART determination to satisfy certain aspects of the BART
alternative provisions in 40 CFR part 51, Sec.  51.308(e)(2) if such a
program can be demonstrated to be more stringent than CSAPR.
Specifically, the state should be able to rely on the EPA's
determination that CSAPR resulted in greater reasonable progress than
source-specific BART to satisfy the requirements of Sec.
51.308(e)(2)(i)(E) and (e)(3).
    We acknowledge that other requirements of Sec.  51.308(e)(2) would
still need to be satisfied, such as monitoring, recordkeeping,
reporting, and provisions for emission trading programs. While the
CSAPR option is specifically listed at Sec.  51.308(e)(4), the EPA's
Regional Haze rules do not prohibit a state from relying on EPA's
modeling demonstration that CSAPR resulted in greater reasonable
progress when using an alternative under Sec.  51.308(e)(2). If a
state-only program is more stringent than CSAPR, for example a program
based on CSAPR allocations but without interstate trading, requiring a
state to conduct extensive modeling to demonstrate what the EPA has
already demonstrated for a less stringent program is illogical and
places an unnecessary and wasteful burden on states.
    Response: We agree with this comment. In response to this comment,
our final FIP establishes an intrastate trading program that operates
much like the CSAPR program did in Texas. This program is discussed in
more detail elsewhere.
3. EPA's Reliance on CSAPR for NOX BART
    Comment: Agree with EPA's proposal regarding CSAPR as a BART
alternative for NOX which is proposed for separate
finalization. EPA could have followed the D.C. Circuit's directive and
updated NOX (and SO2) budgets for Texas. EPA
could have but declined to do so. EPA notes that finalization of CSAPR
as better-than-BART for NOX is contingent on a separate
finalization that the D.C. Circuit remands would not adversely impact
2012 demonstrations. Uncertainty in this proposal does not seem to be
an issue for NOX and EPA is again basing a proposal on an
action yet to be finalized.
    Response: Whether we were in a position to provide updated annual
NOX and SO2 budgets for Texas is not relevant to
this rulemaking. Because Texas EGUs are required to continue

participation in CSAPR for ozone transport, which involves
NOX trading, we are determining that the NOX BART
requirement for EGUs continues to be met through our determination that
CSAPR is better than BART.
    We interpret the comment as supporting this action, even as it
appears to criticize our reference to another proposed action, which
has since been finalized, as part of the proposal for the
NOX aspect of this action. Our proposed and finalized action
for the NOX BART requirement addresses the Act's
requirements for Texas. This action and our recent action to remove
Texas EGUs from CSAPR's SO2 trading program are distinct
actions, but we have provided appropriate transparency and notice
regarding how the proposed actions relate and have given careful
consideration to comments received that have bearing on each of the
actions.
    Comment: EPA's proposal is unlawful because it exempts sources from
installing BART controls without going through the exemption process
Congress prescribed. The visibility protection provisions of the Clean
Air Act include a ``requirement'' that certain sources ``install, and
operate'' BART controls. 42 U.S.C. 7491(b)(2)(A). Congress specified
the standard by which sources could be exempted from the BART
requirements, which is that the source is not reasonably anticipated to
cause or contribute to a significant impairment of visibility in any
Class I area. Appropriate federal land managers must concur with any
proposed exemption. EPA has not demonstrated that any of the Texas EGUs
subject to BART meet the standards for an exemption, nor has EPA
obtained the concurrence of federal land managers. Therefore, EPA must
require source-specific BART for each power plant subject to BART.
    Response: To the extent the comment is directed to the prior rules
that determined and redetermined that CSAPR is better than BART and may
be relied upon as an alternative to BART, we disagree that relying on
CSAPR is in conflict with the CAA provision regarding exemptions from
BART. In addition, the commenter's objection does not properly pertain
to this action, but instead to our past action that established 40 CFR
51.308(e)(4). We believe this comment to fall outside of the scope of
our action here. To the extent the comment objects to BART alternatives
generally, we also disagree. In addition, that objection does not
properly pertain to this action, but instead to our past regulatory
action that provided for BART alternatives.
    Comment: Even if EPA could use a BART alternative without going
through the statutory exemption process, the CSAPR-Better-than-BART
Rule was fatally flawed, and even if it were valid in 2012, is now
woefully outdated. EPA's regulations purport to allow the use of an
alternative program in lieu of source-specific BART only if the
alternative makes ``greater reasonable progress'' than would BART. 40
CFR 51.308(e)(2). To demonstrate greater reasonable progress, a state
or EPA must show that the alternative program does not cause visibility
to decline in any Class I area and results in an overall improvement in
visibility relative to BART at all affected Class I areas. Id. Sec.
51.308(e)(3)(i)-(ii).
    EPA compared CSAPR to BART in the Better-than-BART Rule by using
CSAPR allocations that are more stringent than now required as well as
by using presumptive BART limits that are less stringent than are
actually required under the statute. Even under EPA's skewed 2012
comparison, CSAPR achieves barely more visibility improvement than BART
at Big Bend and Guadalupe Mountains. The NOX emissions
allowed under CSAPR from Texas EGUs are higher than would be allowed
under BART. This was true even before EPA revised CSAPR to increase the
emissions allocations for all Texas EGUs.
    If it were assumed that the CSAPR-Better-than-BART Rule were valid
in 2012, it is based on assumptions for both CSAPR and BART emissions
which are now woefully outdated. The CSAPR-Better-than-BART Rule's
reliance on presumptive BART emission limits is now outdated, given
that EPA has issued or approved source-specific BART determinations for
dozens of sources since 2012. In particular, for Texas sources, EPA has
proposed SO2 BART limits which are far below the presumptive
BART limits EPA used in the Better-than-BART Rule. For units other than
Martin Lake, EPA proposes SO2 BART limits of 0.04 to 0.06
lbs/MMBtu, which are well below the presumptive SO2 BART
limit of 0.15 lbs/MMBtu; even at Martin Lake, EPA proposes limits of
0.11 to 0.12, which are still below presumptive BART for
SO2.
    Similarly, the CSAPR-Better-than-BART Rule is based on a version of
CSAPR that no longer exists. Accordingly, any conclusion that EPA made
in the 2012 Better than BART rule regarding whether CSAPR achieves
greater reasonable progress than BART is no longer valid. Since 2012,
EPA has significantly changed the allocations and the compliance
deadlines for CSAPR. Of particular relevance here, after 2012, EPA
dramatically increased the CSAPR allocations for every covered EGU in
Texas. EPA later withdrew the February 21, 2012 rule revision, but
issued a new rule that included both the changes in the February 21,
2012 rule as well as additional changes to state budgets.
    By the time EPA finalized the Better-than-BART-Rule in June 2012,
EPA had changed the state emissions budgets by tens of thousands of
tons, yet EPA proceeded to finalize the Better-than-BART Rule based
solely on the emissions budgets in the original, 2011 CSAPR rule. EPA
also extended the compliance deadlines by three years, such that the
phase 1 emissions budgets take effect in 2015-2016 and the phase 2
emissions budgets take effect in 2017 and beyond. Even more changes to
CSAPR have occurred as a result of the D.C. Circuit's decision in EME
Homer City II Generation, including the proposed withdrawal of Texas
from the annual NOX and SO2 trading programs.
Given the large number of final BART determinations made since 2012,
and the significant changes to CSAPR budgets since 2012, it is
arbitrary and capricious to rely on the outdated assumptions about
emissions which were made in the CSAPR-Better-than-BART Rule.
    Response: As we had proposed, our finalized determination that
CSAPR participation will resolve NOX BART requirements for
Texas EGUs is based on a separately proposed and finalized action. This
comment falls outside of the scope of our action here.
    Comment: EPA's November 2016 ``Sensitivity Analysis'' purports to
update its CSAPR-Better-than-BART analysis to show that CSAPR still
makes greater reasonable progress than BART. We agree with EPA that the
2016 Sensitivity Analysis is not a proper legal basis for demonstrating
that CSAPR makes greater reasonable progress than BART, because the
2016 analysis is merely a proposed rule. It would be unlawful to issue
a final BART rule relying on CSAPR to satisfy the NOX BART
requirements in the absence of a final rule demonstrating that the
CSAPR Update makes greater reasonable progress than BART.
    To demonstrate that CSAPR makes greater reasonable progress than
BART, EPA must show that (1) visibility does not decline in any Class I
area under CSAPR, and (2) there is an overall improvement in
visibility, based on comparing the average differences between CSAPR
and BART across all affected Class I areas. EPA's analysis falls well
short of making such a

demonstration, as we noted in our prior comments on EPA's 2016
Sensitivity Analysis.
    EPA's 2016 analysis is markedly different from the CSAPR-Better-
than-BART Rule, which relied on quantitative modeling of electric power
section emissions, using the Integrated Planning Model, and
quantitative modeling of visibility at all affected Class I areas,
using CAMx. Instead of updating that modeling, EPA's 2016 analysis
consists of a back-of-the-envelope, qualitative discussion. This is
wholly insufficient. There have been enormous changes in the electric
power sector since EPA issued the Better-than-BART Rule in 2012,
including changes in regulatory requirements (e.g., CSAPR revisions,
NAAQS updates, etc.) and changes in unit operations caused by changes
in fuel prices, demand, etc. Given that EPA believed in 2012 that it
was necessary to conduct quantitative modeling of power sector
emissions and the visibility impacts of such emissions, EPA must update
that modeling in order to prove that CSAPR still makes greater
reasonable progress than BART.
    EPA's failure to update the modeling upon which it relied in the
2012 Better than BART Rule is even more arbitrary given EPA's
assumption, in the 2016 Sensitivity Analysis, that no trading of CSAPR
allowances would occur across state lines. The Sensitivity Analysis
uses ``emissions that would occur if the state budgets are increased as
proposed assuming that all of the additional allowances are used by
sources in the respective state (i.e., we did not re-model trading).''
This assumption bears no relationship to reality, in which CSAPR--both
the original rule, and the updated rule--expressly allows trading
across state lines. EPA's failure to create a realistic depiction of
the geographic distribution of emissions under the updated CSAPR
budgets dooms its Sensitivity Analysis, as EPA must demonstrate that
visibility does not decline in any Class I area. Trading across state
lines can increase emissions from particular sources, which in turn can
degrade visibility at particular Class I areas. Having failed to
consider how inter-state trading will affect the distribution of
emissions under CSAPR, EPA cannot possibly show that visibility will
not decline in any Class I area under CSAPR.
    Similarly, EPA failed to account for intra-state trading under
CSAPR. Even assuming all changes in budgets would apply only within the
affected state--that is, assuming interstate emissions trading did not
change at all--EPA has not accounted for trading within the states. A
20% reduction in statewide emissions does not imply that each unit will
reduce its emissions by 20%; indeed, some units could increase
emissions while statewide emissions went down. EPA does not seem to
have accounted for this in its analysis. Thus, even within EPA's
scenario whereby no changes to reflect current conditions need to be
made, EPA's ad hoc analysis fails to demonstrates that the ``Better-
than-BART'' test above would be met because EPA has failed to account
for changes in emissions distribution based on the altered budgets.
    In addition, EPA cannot simply assume that the visibility
improvement averaged across all Class I areas, 40 CFR 51.308(e)(3)(ii),
will still be better under the updated CSAPR than under BART. Without
updated visibility modeling, EPA has no data to demonstrate that the
second prong of the BART alternative test will be met in spite of the
substantial changes in coverage and budgets under CSAPR.
    Response: In part, the comment makes the point that this final
action cannot rely on another action that has only been proposed. We
agree with this aspect of the comment, but this part of the comment is
no longer relevant because the other action has now been finalized. As
we had proposed, our finalized determination that CSAPR participation
will resolve NOX BART requirements for Texas EGUs is based
on a separately proposed and now finalized action. This comment in its
discussion of the 2016 sensitivity analysis and other particulars
raises issues that are addressed in the record for that separately
finalized action. This comment falls outside of the scope of our action
here.
    Comment: Under the updated version of CSAPR, Texas will not have
allowances for annual NOX emissions. Instead, Texas will
have a CSAPR budget for NOX for only the ozone season, which
runs a few months each year. But BART is not a seasonal requirement;
BART requires continuous operation of pollution controls. ``The
determination of BART must be based on an analysis of the best system
of continuous emission control technology available and associated
emission reductions achievable for each BART-eligible source that is
subject to BART within the State.'' It violates EPA's regulations to
use seasonal emissions reductions under CSAPR to satisfy the BART
requirement to install and operate ``continuous emission control
technology.''
    Response: We disagree with this comment, but also note that it
should not be directed to this action but rather to the past rulemaking
determination that provided BART coverage for pollutant trading under
CSAPR as specified at 40 CFR 51.308(e)(4). In any event, the argument
that BART must be based on ``continuous'' control does not transfer to
the application and operation of a BART alternative. Sources that would
operate under an annual trading program that provides tons per year
allocations for a unit are not necessarily applying ``continuous''
controls either. In fact, they are also free to operate seasonally or
with intermittent use of controls so long as they operate within the
allocation or purchase allowances whenever emissions may exceed that
allocation. We necessarily disagree that EPA regulations would bar
seasonal emissions reductions to satisfy requirements for a BART
alternative.
4. Other CSAPR Comments
    Comment: The EPA should proceed to finalize CSAPR as a better-than-
BART alternative not only as to NOX but also as to
SO2. In the Texas Regional Haze SIP, Texas relied on EPA's
Regional Haze Rule that allows states to implement an alternative to
BART as long as the alternative has been demonstrated to achieve
greater reasonable progress toward the national visibility goal than
BART. EPA made such a demonstration for CAIR and many states, including
Texas, relied on CAIR's cap and trade programs as a BART alternative
for EGU emissions of SO2 and NOX in their SIP
submittals. Following EPA's demonstration in 2005 that CAIR is better-
than-BART and after Texas submitted the Regional Haze SIP, the D.C.
Circuit Court remanded CAIR to EPA but ultimately did not vacate the
CAIR rule. EPA approved certain States' SIPs that implemented CAIR as a
BART alternative, yet, EPA did not do so for Texas.
    CSAPR was issued to replace CAIR and because of EPA's action on
CAIR, EPA subsequently withdrew reliance on CAIR as a BART alternative
and finalized the demonstration that compliance with CSAPR is better
than application of BART. This action occurred after Texas had
submitted its SIP.
    On December 16, 2014, EPA published a proposed FIP program to
``replace reliance on CAIR with reliance on the trading programs of
CSAPR as an alternative to BART for SO2 and NOX
emissions for EGUs.'' The CSAPR rule had been challenged in the D.C.
Circuit and the court held that EPA had over-controlled certain States'
budgets and remanded the CSAPR rule without vacatur for further
revision by EPA. In January 2016, EPA did not finalize BART controls
for EGUs, citing

uncertainty. EPA issued the CSAPR Update on October 24, 2016 but did
not revise SO2 or NOX annual budgets for Texas.
    EPA's Proposed FIP and the imposition of source-specific BART
relies on the EPA's proposed rulemaking for the withdrawal of Texas
from the CSAPR Phase 2 trading budgets for SO2. In November
2016, EPA published a proposal to withdraw the FIP provisions that
required affected EGUs to participate in Phase 2 of the CSAPR trading
programs for annual emissions of SO2 and NOX
purportedly to address a decision of the U.S. Court of Appeals for the
District of Columbia Circuit that had remanded for further
consideration the CSAPR Phase 2 SO2 budgets for Texas and
other states.
    EPA's proposed withdrawal of Texas from the Phase 2 CSAPR program
for SO2 included a ``sensitivity analysis'' indicating that
removal of Texas from the Phase 2 SO2 budget trading program
(and including the removal of the Florida trading program) would not
adversely impact the demonstration that CSAPR participation continued
to qualify as an alternative to compliance with BART, in other states
that were relying on CSAPR for BART compliance.
    EPA also noted that ``[n]o changes to the Regional Haze Rule are
proposed as part of the rulemaking.'' Id. However, in support of this
FIP proposal addressing Regional Haze, EPA notes that it, ``had earlier
proposed to rely on CSAPR participation to address these BART-related
deficiencies in Texas' SIP submittals referencing its December, 2014
proposed FIP.'' EPA did not address the D.C. Circuit Court's remand as
directed.
    The D.C. Circuit had remanded without vacatur the Phase 2 budgets
in EME Homer City Generation, L.P. v. EPA, 795 F.3d 118 (D.C. Circuit
2015) and directed the EPA to reconsider the emission budgets and
propose revised budgets. AEP said they did not support EPA's proposal
to withdraw Texas from CSAPR, stating that the EPA had provided
insufficient justification and explanation for the proposal and had not
considered the impact on the trading market. AEP noted that the court
had specifically not vacated the Phase 2 budgets due to concerns that
such a decision would disrupt the trading markets. AEP also expressed
concern that withdrawing Texas from CSAPR would impact the compliance
strategies facilities have developed for compliance with BART, as BART
eligible facilities had developed compliance strategies assuming BART
compliance would be achieved through compliance with CSAPR. AEP said
they supported the CSAPR trading programs because of their flexibility
and administrative convenience, cost-effectiveness and the ``remarkable
reductions that have occurred across the electric utility industry.''
AEP also considered EPA's analysis of the impact of sources in Texas on
nonattainment areas in other states was inadequate and the explanation
provided by EPA for its decision to change the initial determination
was insufficient and potentially exposed Texas EGUs to future liability
for the impact of PM2.5 emissions on Madison County and
other upwind locations. AEP concluded their comments on 81 FR 78954 by
recommending the EPA finalize CSAPR as a compliance alternative to BART
for SO2 and revise the Phase 2 budgets, instead of
withdrawing Texas from CSAPR.
    The D.C. Circuit requires EPA to propose acceptable budgets
consistent and confirm that those budgets are a BART alternative and
allow Texas to remain in the CSAPR trading program. Source specific
controls, then, would no longer be necessary since CSAPR as a BART
alternative would provide a more cost-effective, less burdensome and
flexible program for compliance with Texas' visibility obligations.
    By EPA's reliance on the proposed withdrawal of Texas from the
CSAPR trading program for SO2 as the basis for the proposed
Texas BART FIP, EPA is illegally proposing BART controls on facilities
premised on a proposed rule. Buttressing the proposed FIP on a
proposed-not-yet-finalized rule is inconsistent with the APA. EPA seems
concerned with uncertainty created by the remand yet, this action by
EPA creates its own uncertainty with regard to whether the proposed
withdrawal will be finalized as proposed. The APA requires that an
agency provide notice and an opportunity to comment on proposed rules.
5 U.S.C. 553(c). An agency must be open to taking comments and
responding to them. This necessarily requires that EPA must consider
comments from the public before finalizing a proposed rule. In fact,
the comment period for the proposed withdrawal of Texas from the
SO2 CSAPR budgets ended after the date of the proposed BART
FIP. Clearly, EPA gave itself no opportunity to consider public comment
on the proposed withdrawal prior to relying on it as if it were final
as proposed to justify the need for proposing source-specific BART.
EPA's actions demonstrate that it had no intention of accepting public
comment and had already made up its mind that the proposal would be
finalized as proposed, a direct contravention of the APA.
    Response: Several contentions provided by this commenter are
relevant to the action withdrawing Texas from Phase 2 CSAPR program
budget, but given the finalization of that action they are not relevant
to this action. We are required to address the BART requirements for
both pollutants under our CAA FIP authority, in the absence of an
approvable SIP. We are finalizing our proposal that NOX BART
is met by continued participation in CSAPR and we are finalizing a BART
alternative to address the SO2 BART requirement. The BART
alternative applies the CSAPR allowance allocations for SO2
to all BART-eligible coal-fired EGUs, several additional coal-fired
EGUs, and several BART-eligible gas-fired and gas/fuel oil-fired EGUs.
In addition to being a sufficient alternative to BART, it secures
reductions consistent with visibility transport requirements and is
part of the long-term strategy to meet the reasonable progress
requirements of the Regional Haze Rule.
    We do not agree with the commenter's suggestion that we were not
open to the consideration of comments in our proposed action or in any
related actions in violation of the APA. Moreover, the assertion that
EPA had made up its mind that any proposal would be finalized as
proposed regardless of comments that might be offered is not correct.
For efficiency and because of time constraints, our proposal for the
NOX aspect of this action was based on a scenario of later
finalization of the CSAPR remand response rule, but that does not mean
that we did not fairly consider all comments on the CSAPR remand
response rule or pre-decided the outcome of that rule. Our final
decisions in this action reflect the final CSAPR remand rule, and
consideration of comments on our proposal for this action.
    Comment: Recommend the CSAPR budgets be revised. Revising the CSAPR
budgets is supported by actual SO2 emissions. The Texas EGU
SO2 and NOX emissions have steadily decreased and
have fallen well below 2017 CSAPR budgets. These emissions are well
below the original better-than-BART budgets for SO2. EPA's
determinations that CSAPR is better-than-BART is still valid and
supported even if emissions were increased.
    We anticipate that EPA may respond that a September 9, 2017 Consent
Decree deadline (derived from a case in which the EGUs were not party)
did not permit time to consider comments before proposing the Texas
BART FIP.

Clearly, the most expeditious approach would be for EPA to revise the
invalid Phase 2 CSAPR budgets for Texas and propose that reliance on
the revised budgets satisfies BART compliance. Any delays in addressing
Texas' BART obligations are the result of EPA not establishing an
acceptable CAIR or CSAPR program, and EPA's refusal to revise CSAPR
Phase 2 budgets and not Texas' failure to agree to accept invalid CSAPR
budgets. In fact, the D.C. Circuit instructed EPA to act ``promptly''
in revising the budgets.
    Additionally, EPA's attempt to comply with a court deadline does
not justify noncompliance with the APA. With its current proposal
(Texas BART FIP), EPA has done nothing but create further uncertainty
and violate the APA. EPA could have requested an extension of the
deadline to revise the budgets, but did not. Consistent with the
Administration's Executive Order on Reducing Regulation and Controlling
Regulatory Costs, EPA could revise the CSAPR budgets adhere to CSAPR is
better-than-BART, as they have in many other states, and remove two
proposed regulations in doing so without the promulgation of another
rule (proposed withdrawal of Texas from the CSAPR Phase 2 program and
proposed source-specific BART for Texas source.) EPA should update the
Phase 2 SO2 budgets as directed and post-haste proceed to
finalize CSAPR as a better an alternative to the application of source-
specific BART.
    Response: Texas declined to submit a SIP to voluntarily participate