[Federal Register: December 19, 2005 (Volume 70, Number 242)]
[Rules and Regulations]
[Page 75047-75059]
[DOCID:fr19de05-14]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 63

[OAR-2003-0028, FRL-8009-5]
RIN: 2060-AI72

List of Hazardous Air Pollutants, Petition Process, Lesser
Quantity Designations, Source Category List

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is amending the list of hazardous air pollutants (HAP)
contained in section 112 of the Clean Air Act (CAA) by removing the
compound methyl ethyl ketone (MEK) (2-Butanone) (CAS No. 78-93-3). This
action is being taken in response to a petition submitted by the
Ketones Panel of the American Chemistry Council (formerly the Chemical
Manufacturers Association) on behalf of MEK producers and consumers to
delete MEK from the HAP list. Petitions to remove a substance from the
HAP list are permitted under section 112 of the CAA.
    Based on the available information concerning the potential hazards
of and projected exposures to MEK, EPA has made a determination
pursuant to CAA section 112(b)(3)(C) that there are ``adequate data on
the health and environmental effects [of MEK] to determine that
emissions, ambient concentrations, bioaccumulation, or deposition of
the substance may not reasonably be anticipated to cause adverse
effects to human health or adverse environmental effects.''

EFFECTIVE DATE: December 19, 2005.

ADDRESSES: EPA has established a docket for this action under Docket ID
No. OAR-2003-0028 and A-99-03. All documents in the docket are listed
in the EDOCKET index at http://www.epa.gov/edocket. Although listed in

the index, some information is not publicly available, i.e.,
confidential business information or other information whose disclosure
is restricted by statute. Certain other material, such as copyrighted
material, is not placed on the Internet and will be publicly available
only in hard copy form. Publicly available docket materials are
available either electronically in EDOCKET or in hard copy at EPA
Docket Center (Air Docket), EPA/DC, EPA West, Room B-108, 1301
Constitution Avenue, NW., Washington, DC 20004. The Public Reading Room
is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding
legal holidays. The telephone number for the Public Reading Room is
(202) 566-1744, and the telephone number for the Air Docket is (202)
566-1742.

FOR FURTHER INFORMATION CONTACT: Mr. Mark Morris, Office of Air Quality
Planning and Standards, Emission Standards Division, C404-01,
Environmental Protection Agency, Research Triangle Park, NC 27711;
telephone number:<PHONE_NUMBER>; fax number:<PHONE_NUMBER>; e-mail
address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:
    Regulated Entities. Entities potentially affected by this action
are those industrial facilities that manufacture or use MEK. This
action amends the HAP list contained in section 112(b)(1) of the CAA by
removing the compound MEK. The decision to issue a final rule to delist
MEK removes MEK from regulatory consideration under section 112(d) of
the CAA.
    Judicial Review. Under section 307(b)(1) of the CAA, judicial
review is available only by filing a petition for review in the U.S.
Court of Appeals for the District of Columbia Circuit by 60 days from
publication in the Federal Register. Under section 307(d)(7)(B) of the
CAA, only an objection to a rule or procedure raised with reasonable
specificity during the period for public comment can be raised during
judicial review. Moreover, under section 307(b)(2) of the CAA, the
requirements established by the final rule may not be challenged
separately in any civil or criminal proceeding brought to enforce these
requirements.
    Outline. The information presented in this preamble is organized as
follows:

I. Introduction
    A. The Delisting Process
    B. The Present Petition and Rulemaking
II. Completion of Final Inhalation Reference Concentration
III. Acute Effects From Exposure to MEK
IV. Voluntary Children's Chemical Evaluation Program Peer Review
V. Adverse Comments and EPA Responses
VI. Final Rule
    A. Rationale for Action
    B. Effective Date
VII. References
VIII. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Analysis
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health & Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Congressional Review Act

I. Introduction

A. The Delisting Process

    Section 112 of the CAA contains a mandate for EPA to evaluate and
control emissions of HAP. Section 112(b)(1) includes an initial HAP
list that is composed of specific chemical compounds and compound
classes to be used by EPA to identify source categories for which EPA
will subsequently promulgate emissions standards.
    CAA section 112(b)(2) requires EPA to make periodic revisions to
the initial HAP list set forth in CAA section 112(b)(1) and outlines
criteria to be applied in deciding whether to add or delete particular
substances. Section 112(b)(2) identifies pollutants that should be
listed as:

* * * pollutants which present, or may present, through inhalation
or other routes of exposure, a threat of adverse human health
effects (including, but not limited to, substances which are known
to be, or may reasonably be anticipated to be, carcinogenic,
mutagenic, teratogenic, neurotoxic, which cause reproductive
dysfunction, or which are acutely or chronically toxic) or adverse
environmental effects whether through ambient concentrations,
bioaccumulation, deposition, or otherwise. * * *
    To assist EPA in making judgments about whether a pollutant causes
an adverse environmental effect, CAA section 112(a)(7) defines an
``adverse environmental effect'' as:

* * * any significant and widespread adverse effect, which may
reasonably be anticipated, to wildlife, aquatic life, or other
natural resources, including adverse impacts on populations of
endangered or threatened species or significant degradation of
environmental quality over broad areas.

    Section 112(b)(3) establishes general requirements for petitioning
EPA to modify the HAP list by adding or deleting a substance. Although
the Administrator may add or delete a substance on his own initiative,
in the case where a party petitions the Agency to add or delete a
substance, the burden has historically been on the petitioner to
include sufficient information to support the requested addition or
deletion under the substantive criteria set forth in CAA section
112(b)(3)(B) and (C). The Administrator must either grant or deny a
petition within 18 months of receipt of a complete petition. If the
Administrator decides to grant a petition, EPA publishes a written
explanation of the Administrator's decision, along with a proposed rule
to add or delete the substance. If the Administrator decides to deny
the petition, EPA publishes a written explanation of the basis for
denial. A decision to deny a petition is final Agency action subject to
review in the DC Circuit Court of Appeals under CAA section 307(b).
    To promulgate a final rule deleting a substance from the HAP list,
CAA section 112(b)(3)(C) provides that the Administrator must determine
that:

* * * there is adequate data on the health and environmental effects
of the substance to determine that emissions, ambient
concentrations, bioaccumulation or deposition of the substance may
not reasonably be anticipated to cause any adverse effects to the
human health or adverse environmental effects.

    EPA will grant a petition to delete a substance and publish a
proposed rule to delete that substance if it makes an initial
determination that this criterion has been met. After affording an
opportunity for comment and for a hearing, EPA will make a final
determination whether the criterion has been met.
    EPA does not interpret CAA section 112(b)(3)(C) to require absolute
certainty that a pollutant will not cause adverse effects on human
health or the environment before it may be deleted from the list. The
use of the terms ``adequate'' and ``reasonably'' indicate that EPA must
weigh the potential uncertainties and their likely significance.
Uncertainties concerning the risk of adverse health or environmental
effects may be mitigated if EPA can determine that projected exposures
are sufficiently low to provide reasonable assurance that such adverse
effects will not occur. Similarly, uncertainties concerning the
magnitude

of projected exposure may be mitigated if EPA can determine that the
levels that might cause adverse health or environmental effects are
sufficiently high to provide reasonable assurance that exposures will
not reach harmful levels. However, the burden remains on a petitioner
to resolve any critical uncertainties associated with missing
information. EPA will not grant a petition to delete a substance if
there are major uncertainties that need to be addressed before EPA
would have sufficient information to make the requisite determination.

B. The Petition and Rulemaking

    On November 27, 1996, the American Chemistry Council's Ketones
Panel submitted a petition to delete MEK (CAS No. 78-93-3) from the HAP
list in CAA section 112(b)(1). Following the receipt of the petition,
EPA conducted a preliminary evaluation to determine whether the
petition was complete according to EPA criteria (58 FR 45081). To be
deemed complete, a petition must consider all available health and
environmental effects data. A petition must also provide comprehensive
emissions data, including peak and annual average emissions for each
source or for a representative selection of sources, and must estimate
the resulting exposures of people living in the vicinity of the
sources. In addition, a petition must address the environmental impacts
associated with emissions to the ambient air and impacts associated
with the subsequent cross-media transport of those emissions.
    EPA published a notice of receipt of a complete petition to delist
MEK in the Federal Register on June 23, 1999 (64 FR 33453), and
requested information to assist us in technically reviewing the
petition in addition to other comments. In response to the request for
comment, EPA received ten submissions that included information to aid
in the technical review of the petition.
    Based on a comprehensive review of the data provided in the
petition and from other sources, EPA made an initial determination that
the statutory criterion for deletion of MEK from the HAP list had been
met. EPA, therefore, granted the petition by the American Chemistry
Council's Ketones Panel and issued a proposed rule to delist MEK on May
30, 2003 (68 FR 32608). EPA responded to substantive comments on the
notice of receipt of a complete petition in the preamble to the
proposed rule. The delay between receiving a complete petition and
publishing the proposal to delist was due, in part, to the time it took
to reevaluate and update the human health toxicity value for MEK.
    EPA received a total of 57 comments on the proposed rule and
responds to the substantive comments below. There was no request for a
public hearing.

II. Completion of the 2003 Inhalation Reference Concentration

    In the preamble to the proposed rule, EPA stated that it would not
make the final decision whether to delist MEK until it considered the
inhalation reference concentration (RfC) resulting from an updated
Integrated Risk Information System (IRIS) review. This review was
completed in 2003. The MEK RfC is a peer-reviewed value defined as an
estimate (with uncertainty spanning perhaps an order of magnitude) of a
daily inhalation exposure to the human population (including sensitive
subgroups) that is likely to be without an appreciable risk of
deleterious effects during a lifetime.
    The 2003 RfC was not yet finalized when EPA received the petition.
However, to support statutory requirements and assist in the
determination of the technical merits of the petition to delist MEK,
EPA's Office of Research and Development derived an interim health
effects threshold for MEK inhalation exposure that considered current
data and current EPA science policy. That process resulted in the
derivation of a prospective RfC of 9 milligrams per cubic meter (mg/
m3). The analysis underlying the development of the
prospective RfC can be found in ``A Prospective Reference Concentration
for MEK (78-93-3),'' which is in the docket. In the preamble to the
proposed rule, EPA stated that while it would base its initial
determination to delist MEK on the prospective RfC, it would rely on
the RfC and other information resulting from the completed IRIS
assessment in making its determination whether to delist MEK.
    The 2003 RfC was published in IRIS on September 26, 2003. Where the
prospective RfC was 9 mg/m3, the 2003 RfC is slightly lower
at 5 mg/m3 because of a difference in dose-response
methodology and interpretation of remaining uncertainties. To evaluate
the potential impact of the 2003 RfC on the decision to delist, EPA
recalculated the inhalation hazard quotient (HQ) using the 2003 RfC and
the estimate of maximum exposure cited in the proposed rule. Whereas
the HQ calculated in the proposed rule was 0.1, the new HQ is 0.2, or
20 percent of the RfC. EPA still finds the recalculated HQ to be below
a level of concern. Thus, the 2003 RfC did not change the scientific
basis of EPA's determination that emissions, ambient concentrations,
bioaccumulation, or deposition of MEK may not reasonably be anticipated
to cause adverse human health or environmental effects.

III. Acute Effects From Exposure to MEK

    In the preamble to the proposed rule, EPA addressed acute exposure
from MEK using the Dick et al. (1992) study (Dick study), which
assessed neurotoxic effects. EPA concluded that the Dick study
indicated that exposures to MEK of up to 200 parts per million (ppm)
(590 mg/m3) for up to 4 hours would be an appropriate no-
adverse-effect concentration for the general population for both
subjective effects (such as objectionable odor or irritancy) and for
neurobehavioral effects.
    EPA used the Dick study to examine the potential effects of short-
term exposure to MEK because no short-term human health values have
been finalized for MEK. The Dick study is the best study in the MEK
database with which to assess short-term effects of MEK exposure.
    During public comment, EPA did not receive any negative comment on
our interpretation of the Dick study. EPA did, however, receive a
request to address the potential for developmental effects as a result
of short-term exposure because the RfC that EPA used to assess long-
term exposure to MEK was based on a developmental endpoint.
    EPA agrees that this is appropriate to do since the Agency, thus
far, has not finalized an acute reference exposure methodology. EPA is
in the process of developing this methodology and sought the Science
Advisory Board's (SAB) review of the draft methodology in 1998 (The SAB
report is available at: http://www.epa.gov/sab/pdf/ehc9905.pdf). Thus,

EPA considered several types of analysis. One type of analysis EPA
considered was a general approach consistent with that used for the
chronic RfC and based on the developmental study that was the basis for
the RfC.
    The quantitative aspect of EPA's RfC methodology is a two-step
approach that distinguishes analysis of the dose-response data from
inferences made about lower doses. The first step is an analysis of
dose and response in the range of observation of the experimental and/
or epidemiologic studies. The modeling or statistical significance
testing yields a point of departure (POD) from the range of
observation. The second step is extrapolation to lower doses. Thus, the
RfC is derived from the POD (in terms of human equivalent

exposure) for the critical effect by consistent application of
uncertainty factors (UFs). The UFs are applied to account for
recognized uncertainties in the extrapolations from the experimental
data conditions to an estimate appropriate to the assumed human
scenario (U.S. EPA, 1994).
    The POD from the developmental study is a 24-hour human equivalent
exposure concentration of 1,517 mg/m3. In the derivation of
the chronic RfC, this POD was divided by a cumulative UF of 300. The
cumulative factor comprised three UFs, accounting for uncertainties in
interspecies (3) and intraspecies (10) extrapolation, as well as
uncertainty in the database with regard to chronic exposures (10). In
calculating an acute reference value, the latter would not be relevant,
resulting in a cumulative UF of 30. Thus, one analysis of the short-
term exposure potential might result in a short-term (24 hour)
reference value of 50 mg/m3 by dividing 1,517 mg/
m3 by a cumulative UF of 30. The petitioner's maximum
modeled 24-hour average MEK concentration in air of 10 mg/m3 is lower
than this potential short-term reference value by a factor of 5.
    An alternate approach is that routinely employed by EPA's Office of
Prevention, Pesticides and Toxic Substances (OPPTS), which involves
consideration of the margin of exposure (MOE) between the POD and the
estimated exposure concentration of interest (67 FR 60886). For
decision-making purposes, the OPPTS MOE level of concern is the value
derived from multiplicative factors representing key outstanding areas
of uncertainty with regard to the chemical's toxicity. Given the
available data for MEK, which includes an animal study on developmental
toxicity, the predominant outstanding areas of uncertainty with regard
to short-term toxicity are the potential for interspecies and
intraspecies differences in susceptibility. Assigning them each the
traditional default value of 10 yields a MOE of 100.\1\ Therefore, in
evaluating the potential for adverse human health effects to occur from
acute exposures to MEK from inhalation, EPA considers adverse effects
to be unlikely if the MOE is at least 100.
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    \1\ Note that the value of 10 that EPA assigned here for
interspecies variability is greater than the value of 3 that EPA
assigned in developing the RfC for MEK. This adds another layer of
conservatism to our evaluation of the potential for MEK to cause
acute effects.
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    Using the petition's maximum modeled 24-hour average MEK
concentration in air of 10 mg/m3, and the 24-hour human
equivalent exposure concentration at the POD from the study used to
develop the RfC of 1,517 mg/m3, EPA calculates a margin of
exposure of 152. Therefore, based on either of the two approaches
outlined above, the predicted 24-hour exposures to MEK may not
reasonably be anticipated to pose appreciable risk of adverse
developmental health effects. This conclusion, when added to the
previous conclusions described in the preamble to the proposed rule,
further supports our determination that emissions of MEK may not
reasonably be anticipated to cause adverse health or environmental
effects.
    Since proposal, EPA's OPPTS has proposed several Acute Exposure
Guideline Levels (AEGLs) for MEK. The AEGLs represent threshold
exposure limits for the general public for various degrees of severity
of toxic effects, and are applicable to emergency exposure periods
ranging from 10 minutes to 8 hours. It is believed that the recommended
exposure levels are applicable to the general population including
infants and children, and other individuals who may be susceptible.
    The AEGL value for the lowest severity level, the AEGL-1, is the
airborne concentration of a substance above which it is predicted that
the general population, including susceptible individuals, could
experience notable discomfort, irritation, or certain asymptomatic
nonsensory effects. However, the effects are not disabling and are
transient and reversible upon cessation of exposure. With increasing
airborne concentrations above each AEGL, there is a progressive
increase in the likelihood of occurrence and the severity of effects
described for each corresponding AEGL. Although the AEGL values
represent threshold levels for the general public, including
susceptible subpopulations, such as infants, children, the elderly,
persons with asthma, and those with other illnesses, it is recognized
that individuals, subject to unique or idiosyncratic responses, could
experience the effects described at concentrations below the
corresponding AEGL.
    The interim AEGL-1 value for MEK is 200 ppm (for all exposure
periods up to 8 hours). This is the same concentration as the no-
adverse-effect concentration for the general population derived from
the Dick Study, which provides further support for the use of the Dick
study for assessing short-term exposures.

IV. Voluntary Children's Chemical Evaluation Program Peer Review

    In the preamble to the proposed rule, EPA stated that it would not
make the final decision whether to delist MEK until it considered the
results of the peer consultation of the industry's tier 1 submission
for MEK under the Voluntary Children's Chemical Evaluation Program
(VCCEP). The VCCEP is intended to provide information to enable the
public to understand the potential health risks to children associated
with exposures to certain chemicals. Under the VCCEP, EPA has asked
industries that manufacture or import certain chemicals to sponsor
these chemicals to develop assessments regarding the potential health
effects, exposures, and risks of those chemicals to children (see
http://www.epa.gov/chemrtk/vccep/index.htm).

    EPA received the industry's submission under the VCCEP on December
1, 2003. The peer consultation meeting for MEK was held on February 19,
2004. On April 19, 2004, EPA received the report of the peer
consultation. Peer consultation panel members concluded that the MEK
database and submission were adequate, and the key areas of hazard,
exposure, and risk were sufficient to characterize risks to children
for the purposes of the VCCEP. None of the panelists thought that
further data or analyses were needed to characterize MEK's risks to
children for the purposes of the VCCEP. Subsequent to completion of the
final meeting report, EPA requested additional MEK exposure information
from the industry sponsors. This information was provided to EPA on
January 12, 2005 (see http://www.tera.org/peer/vccep/MEK/MEKwelcome.html
).

    The only substantive issue raised by the peer consultation that is
relevant to the final rule pertains to acute exposures to MEK. To
characterize potential impacts from short-term exposures to MEK, the
VCCEP submission took much the same approach that EPA took in the
proposed rule. That is, they estimated maximum short-term exposures and
compared them to a short-term health value that was based on
irritation. Like the public commenter, the VCCEP peer consultation
panel requested that the sponsor compare the short-term exposures to a
developmental endpoint because the RfC was based on a developmental
endpoint.
    The sponsors proposed one of the approaches EPA considered above,
the approach based on the RfC. The sponsors proposed to begin with the
2003 RfC of 5 mg/m\3\, then remove the 10-fold database uncertainty
factor. This results in a 24-hour value of 50 mg/m\3\. The reason given
for the removal of the

uncertainty factor is that it was applied to the RfC to account for the
lack of chronic studies. Since considering chronic studies is not
relevant to the development of a short-term health value, there is no
need for the 10-fold database uncertainty factor. EPA agrees with the
approach submitted to the VCCEP and, as described above, EPA considered
this approach as well as other methods.

V. Adverse Comments and EPA Responses

    Of the 57 written comments EPA received pertaining to the proposed
delisting of MEK, 42 supported the proposal to delist, 13 opposed the
proposal to delist and 2 comments neither supported nor opposed the
proposal. EPA received comments on the development of the RfC used in
the decision and on the exposure assessment.
    EPA has considered carefully all the comments, focusing in
particular on comments which suggested potential deficiencies in the
substantive rationale upon which EPA based its initial determination
that the criterion in CAA section 112(b)(3)(C) had been met. A summary
of the comments and EPA responses has been included in the docket. In
this preamble, EPA will discuss adverse comments received and our
responses to them.
    The proposed rule invited comment from interested parties on the
proposal to delist MEK. In addition, EPA specifically requested
comments on our prospective RfC for MEK (the interim health value EPA
developed for the proposal). EPA also solicited comment on the portion
of our human health risk characterization based on this prospective
RfC. In addition, EPA requested comment on whether it would be
appropriate to delist MEK if the RfC resulting from an updated IRIS
review differed from the prospective RfC; for example, EPA requested
comment on the appropriateness of delisting if the RfC were 3 mg/m\3\,
the level suggested by industry in its petition, or if it remained
unchanged from the 1992 RfC of 1 mg/m\3\.
    Comment: One commenter asserted that the 1992 RfC of 1 mg/m\3\ was
set to protect against birth defects and it should not be changed.
Another commenter stated that the 2003 RfC (external review draft),
which was based on the same study from 1991, does not adequately
provide an estimate ``likely to be without an appreciable risk of
deleterious effects during a lifetime.''
    Response: The RfC is designed to consider all adverse noncancer
effects associated with lifetime exposure to a chemical. The 2003 RfC
is also based on developmental effects, and is based on the
methodologies that were in place at the time of derivation, including
(1) the methods for the use of inhalation dosimetry to extrapolate from
animal to human exposures (U.S. EPA, 1994) and (2) benchmark dose
methods (U.S. EPA, 2000, external review draft). Those methods have
been subject to peer review.
    Comment: One commenter asserted that the toxicological database is
not complete regarding developmental effects, and stated that there is
inadequate evidence to assess the carcinogenic potential of MEK (i.e.,
there are no 2-year animal cancer bioassays).
    Response: There are adequate data on developmental effects and on
cancer effects to support a decision to delist MEK. The principal study
(Schwetz et al., 1991), a developmental toxicity study in the mouse, is
well-designed and tests several exposure concentrations over a
reasonable range that include maximum tolerated doses for dams and
fetuses. Also, animal studies in a second species (rats) corroborate
the effect level for developmental toxicity (Deacon et al., 1981;
Schwetz et al., 1974).
    Regarding carcinogenicity, the current IRIS file (completed in
September of 2003) states that the data for MEK are characterized as
``inadequate for an assessment of human carcinogenic potential.'' The
``Toxicological Review of Methyl Ethyl Ketone'' (U.S. EPA, 2003)
(Toxicological Review of MEK), upon which the IRIS file is based
states, ``Under EPA's draft revised cancer guidelines (U.S. EPA, 1999),
data are inadequate for an assessment of human carcinogenic potential
for MEK because studies of humans chronically exposed to MEK are
inconclusive, and MEK has not been tested for carcinogenicity in
animals by the oral or inhalation routes.'' Recent revision of these
guidelines does not materially affect this conclusion.
    The traditional 2-year animal cancer study has not been conducted
for MEK, nor is EPA aware of any organization planning to conduct one.
EPA believes one reason no cancer assay has been done is that the
results from the majority of the genotoxicity tests (which are often
used as an indicator of the need to pursue a 2-year cancer study) are
negative, indicating that MEK is a low priority for further study. In
1997, the Organization for Economic Cooperation and Development (OECD)
reached this conclusion. OECD's report states that ``MEK is not
genotoxic and is not likely to be carcinogenic.'' (OECD, 1997). The
report also states that MEK is ``* * * currently of low priority for
further work.'' (OECD, 1997).
    The general descriptors recommended by EPA's ``Guidelines for
Carcinogen Risk Assessment'' (U.S. EPA, 1999) for characterizing the
weight of evidence with regard to a chemical's potential for human
carcinogenicity did not explicitly recognize this situation. The
descriptor applied to MEK in the 2003 IRIS assessment (i.e., ``data are
inadequate for an assessment of human carcinogenic potential'')
pertains to cases where ``* * * there is a lack of pertinent or useful
data.'' (U.S. EPA, 1999). While lacking data or studies that would
clearly support their placement in other categories (e.g., the
traditional 2-year rodent study), chemicals included within this broad
category may, however, have pertinent or useful data which do not
indicate any potential for carcinogenicity, consequently providing no
support for the performance of the traditional, resource-intensive
studies.
    Accordingly, EPA's Toxicological Review of MEK also states, ``the
majority of short-term genotoxicity testing of MEK has demonstrated no
activity, and the Structure Activity Relationship (SAR) analysis
suggests that MEK is unlikely to be carcinogenic.'' (U.S. EPA, 2003).
One study (Woo et al., 2002) has given MEK and other unsubstituted
mono-ketones (a compound class to which MEK belongs) a low concern
rating (unlikely to be of cancer concern) because these chemicals lack
electrophilic activity (i.e., a structural alert of carcinogenicity)
and are generally not associated with carcinogenicity.
    There is an absence of positive results in the majority of
mutagenicity and genotoxicity tests which are designed to indicate the
potential for carcinogenicity. Methyl ethyl ketone has been tested for
activity in an extensive spectrum of in vitro and in vivo genotoxicity
assays and has shown no evidence of genotoxicity in most conventional
assays (National Toxicology Program, no date; World Health Organization
1992; Zeiger et al., 1992). Methyl ethyl ketone tested negative in
bacterial assays (both the S. typhimurium (Ames) assay, with and
without metabolic activation, and E. coli), the unscheduled
deoxyribonucleic acid (DNA) synthesis assay, the assay for sister
chromatid exchange (SCE) in Chinese hamster ovary (CHO) cells, the
mouse lymphoma assay, the assay for chromosome aberrations in CHO
cells, and the micronucleus assay in the mouse and hamster. The only
evidence of mutagenicity was mitotic

chromosome loss at high concentrations in a study of aneuploidy in
yeast S. cerevisiae (Zimmerman et al., 1985), but the relevance of this
finding to humans is questionable. Overall, studies of MEK yield little
or no evidence of genotoxicity.
    However, the finding of low potential for genotoxicity alone is not
the sole criterion for an assessment of carcinogenic potential, as non-
genotoxic mechanisms can also result in carcinogenesis. While
developing the final rule, EPA learned that preliminary results of a
recent cancer bioassay by the National Toxicology Program suggested
that methyl isobutyl ketone (MIBK) appears to be a weak or marginally
active carcinogen in rats and mice, possibly by a nongenotoxic mode of
action. Both MEK and MIBK are small molecular weight alkyl ketones, and
this similarity raised some questions regarding the possible relevance
of the preliminary MIBK results to MEK. To investigate this further,
EPA undertook SAR analysis of MIBK and MEK. These two ketones have a
key difference in their chemical structure: MIBK is branched, while MEK
is linear. EPA's SAR analysis indicates that MIBK's toxicity and
possible carcinogenicity are likely due to its branched alkyl
structure. Methyl ethyl ketone, like acetone, is linear and lacks this
structure. Thus, the analysis concluded that in analogy to acetone and
its metabolite isopropanol (which has shown no evidence of
carcinogenicity), MEK and its metabolite (2-butanol) are linear and,
therefore, have low concern for carcinogenicity potential. A short
document describing the analysis, ``Acetone, MEK, and MIBK--SAR
Analysis on Carcinogenicity/Toxicity,'' is included in the docket.
Subsequently, EPA conducted an external peer review of this document.
All three reviewers found the reasoning to be sound and supported the
conclusions of the analysis. These reviews are also included in the
docket. Thus, EPA concludes that the available scientific evidence
shows a low potential for carcinogenicity in MEK.
    Comment: One commenter suggested that the UFs for the prospective
RfC were not adequate. The commenter disagreed with the reduction of
the interspecies UF and stated that it should have remained at 10
because there are no developmental and reproductive studies available
for humans and animals. Another commenter suggested that the human
equivalent concentration (HEC) resulted in low confidence because it
was based on the same mouse study (1991) as the 1992 RfC, and the
prospective RfC was not robust enough to warrant decreasing the
interspecies UF from 10 to 3. This commenter also asserted that the
chronic and reproductive studies are still missing and, therefore,
EPA's proposal of reducing the database UF is not valid. The commenter
contended that the lack of current information results in continued low
confidence in the database because the data used are from the original
studies used to develop the 1992 RfC. The commenter believes that the
Dick study did not provide adequate statistical power. Consequently,
the commenter believes that the lack of toxicity was not demonstrated,
and that the modifying factor should be maintained at 3. The commenter
concluded that the ``absence of data should not conclude an absence of
toxicity.''
    Response: An interspecies UF of 3 was applied in deriving both the
prospective RfC and the 2003 RfC, consistent with EPA guidance for
deriving RfCs in effect at the time (U.S. EPA, 1994). The UF for
interspecies extrapolation is not intended to address database
deficiencies. A database UF of 10 was used in developing the 2003 RfC
to account for the lack of a chronic inhalation toxicity study and
multigeneration reproductive toxicity study.
    Modifying factors have been used in the past in RfC derivations,
where the magnitude of the factor reflected the scientific
uncertainties of the study and database that were not explicitly
treated with standard uncertainty factors. For the 2003 RfC, the
default modifying factor of one was used because EPA concluded that the
modifying factor was sufficiently subsumed in the general database UF.
    Comment: The petitioner stated that EPA did not present adequate
scientific justification for applying a duration adjustment to the
inhalation developmental toxicity study and, at the very least, the
additional conservatism added by the application of this factor should
be explicitly recognized. The commenter pointed to the draft
Toxicological Review that indicated that MEK was rapidly absorbed,
distributed, and metabolized, suggesting that the duration adjustment
may be inappropriate.
    Response: Duration adjustment of the exposure concentrations in the
developmental study of MEK (Schwetz et al., 1991) was performed
consistent with the EPA Risk Assessment Forum RfD/RfC Technical Panel
report, ``A Review of the Reference Dose and Reference Concentration
Processes'' (U.S. EPA, 2002). The report recommends that procedures for
adjusting to continuous exposure based on the product of concentration
and time be used as a default for inhalation developmental toxicity
studies as it is for other health effects from inhalation exposure.
While the recommendation is based on evidence that shows that some
agents cause developmental toxicity more as a function of peak
concentration, the effects of other agents are related to area-under-
the-curve (AUC). The latter is true even of some developmental
toxicants with a short half-life. In the absence of data that support
peak concentration or AUC as more closely correlated with developmental
toxicity, EPA's 2002 review document recommends duration adjustment as
the more health-protective default procedure. As noted in the
Toxicological Review of MEK, because the data are insufficient to argue
convincingly for either peak exposure level or AUC as the most
appropriate metric, the more health-protective procedure (duration
adjustment) was applied as a policy matter.
    Comment: The petitioner commented on our interpretation of the
Cavender et al. (1983) study. They stated that EPA regarded 5,000 ppm
in a 90-day inhalation study as the Lowest Observed Adverse Effect
Level (LOAEL) based on reduced weight gain, increased liver weight, and
decreased brain weight. The commenter stated that this was inconsistent
with the 1992 IRIS database where EPA indicated that a change in liver
weight may not be conclusively caused by MEK inhalation. The petitioner
recommended that 5,000 ppm be the No Observed Adverse Effect Level
(NOAEL).
    Response: In the 2003 IRIS assessment, EPA gave further
consideration to the biological significance of the findings in the
5,000 ppm animals in the Cavender et al. (1983) study, specifically the
organ weight findings. Although the decrease in brain weight in female
high-dose animals is of some concern, EPA agrees that this effect, in
the absence of corresponding histopathology and functional
abnormalities, cannot be clearly characterized as being of
toxicological relevance. In light of these uncertainties,
characterization of the effects associated with the 5,000 ppm exposure
level as adverse, use of that level as a LOAEL, and the use of mid-dose
group (2,518 ppm) as a NOAEL were dropped.
    Comment: Three commenters suggested that the actual emissions of
MEK may result in environmental concentrations below the RfC, but
allowable emissions would not. This

means that should the emissions reach allowable limits, then the
concentrations of MEK will be above the RfC. One commenter provided an
example of a facility that emits 500 tons per year (tpy) of MEK but is
permitted to emit up to 2,200 tpy. The commenter states that a simple
screening model run (most likely similar to the tier 1 or tier 2
analysis submitted by the petitioner) of this facility at the allowable
emission rate predicts 24-hour peak concentrations to be about 75 mg/
m3, which is above the maximum predicted 24-hour average
concentration of 10 mg/m3 that EPA cited in the preamble.
    Response: The maximum offsite 24-hr MEK concentration for the
worst-case facility in the petition as predicted by the Industrial
Source Complex Short Term 3 (ISCST3) model was 10 mg/m3. The
maximum annual concentration was 1.2 mg/m3. This facility
emits about 500 tpy MEK. The maximum offsite concentration occurs
within a few hundred meters of the facility.
    The commenters provided limited information on the facility that
has the potential to emit 2,200 tpy. EPA contacted the commenter in
order to understand how they estimated the value of 75 mg/
m3. EPA was told that the SCREEN3 model was used to estimate
this concentration. However, EPA was unable to obtain the modeling runs
which would contain important model input data (e.g., stack heights and
distances from stacks to fence lines). From the comment, EPA does know
that the maximum offsite concentration for this facility as predicted
by the SCREEN3 model was 75 mg/m3 for a 24-hr average and
1.1 mg/m3 for an annual average. If this facility were
modeled with a more refined dispersion model, such as the ISCST3 model,
EPA would expect impacts that are considerably lower than those
predicted with the more conservative SCREEN3 model. Most likely, the
maximum offsite concentration for the facility would be much closer to
10 mg/m3 for a 24-hr average near the facility, and well
below 1 mg/m3 for the annual average. EPA would suspect that
the facility to which the commenter refers has much better dispersion
characteristics than the petitioner's worst-case facility, which had a
very low stack and nearby fenceline.
    Comment: Three commenters stated that EPA failed to meet the CAA
deadline (18 months) for adding or deleting a substance from the HAP
list, instead taking 78 months total. Therefore, the commenters
believed the 1994 Toxic Release Inventory (TRI) data used in the
assessment were not appropriate and that current TRI data should have
been used. These commenters also contended that the calculations in the
petition did not consider potential increases in MEK use once MEK is
delisted, and that EPA should base its decision to delist MEK on
emission levels and locations expected after delisting.
    Response: EPA interprets the CAA to require consideration of
current emissions. It is not appropriate to make a decision on what can
only be speculative emissions. EPA states in the final rule to delist
caprolactam (61 FR 30816, June 18, 1996) that ``EPA does not interpret
section 112(b)(3)(C) to require consideration of hypothetical emissions
from facilities that might be constructed in the future. The logical
consequence of such an expansive construction would be that no
substance could ever be delisted, due to the hypothetical possibility
of some future facility that has uncontrolled emissions large enough to
cause adverse effects. In the event some future facility has
uncontrolled caprolactam emissions great enough to change the
conclusion of the current EPA risk assessment, EPA can revisit its
decision to delist caprolactam at that time.'' It is not the case,
however, that EPA can never take potential increases in emissions into
account. For example, such consideration is appropriate where EPA has
information regarding specific facilities, such as the information it
considered in denying the methanol delisting petition (66 FR 21929, May
2, 2001).
    Using similar logic in this case, EPA does not interpret CAA
section 112 (b)(3)(C) to require consideration of hypothetical
emissions from facilities that might be constructed in the future, nor
projections of increases in emissions from existing facilities.
    There are several reasons why EPA does not expect that increases in
emissions of MEK will cause health or environmental concerns. With
regard to increased emissions themselves, EPA believes that such
increases will be limited by good housekeeping practices which are
designed to save product. Methyl ethyl ketone is an effective solvent,
but one that evaporates readily. Employing techniques to prevent
wasting the product also results in decreased emissions.
    Due to the health-protective nature of the analysis upon which the
decision to delist is based, EPA concludes that the potential risks
from outdoor exposures to MEK are overestimated. It is unlikely that
future emissions increases will result in unacceptable risk. For
example, the petitioner based the risk assessment on 1994 TRI total air
emissions of MEK, which were 628 tpy for the worst-case facility. This
facility's modeled annual average concentration is only 20 percent of
the RfC. This facility could increase emissions significantly before
the concentration would be above a level of concern. The highest-
emitting facility in the 2003 TRI emits 638 tpy of MEK, only slightly
higher than the 1994 TRI emissions for the worst-case facility.
    In addition, the national trend in MEK emissions is distinctly
downward. Comparing the 1994 and 2003 TRI MEK air emissions data for
the 100 highest-emitting facilities indicates that emissions have
decreased by approximately 20 percent during that nine year period.
    The risk assessment was based on a maximum off-site concentration.
The assessment did not consider the amount of time people would be at
that location, or other factors that address the amount of exposure
faced by actual individuals. Further, this maximum concentration was
located at the entrance to a facility in an industrial park. The
probability that an individual would live at this location in the
future is extremely low.
    Given the low hazard presented by the worst-case facility, the
health-protective nature of the analysis, and the overall downward
trend of MEK emissions over the last several years, EPA believes that
emissions of MEK may not reasonably be anticipated to cause adverse
human health effects.
    The preamble to the proposed rule discussed the March 30, 1998,
Federal Register notice (63 FR 15195) in which EPA issued a Denial of
Petition entitled ``Methyl Ethyl Ketone; Toxic Chemical Release
Reporting; Community Right-to-Know.'' The denial was in response to a
petition from the Ketones Panel of the Chemical Manufacturers
Association (CMA) that requested the deletion of MEK from the list of
chemicals reportable under section 313 of the Emergency Planning and
Community Right-To-Know Act of 1986 (EPCRA) and section 6607 of the
Pollution Prevention Act.
    The American Chemistry Council (formerly the Chemical Manufacturers
Association) filed suit challenging EPA's decision in the United States
District Court for the District of Columbia. Subsequently, the court
granted summary judgment in favor of EPA (American Chemistry Council v.
Whitman, 309 F.Supp. 2d 111 (D.D.C. 2004)). On appeal, the Court of
Appeals for the District of Columbia Circuit reversed the lower court's
decision, vacating the lower court's decision, and directed the
district court to issue an order to ``direct EPA to delete MEK from

the TRI'' (406 F.3d 738, 742 (DC Cir. 2005)). The circuit court issued
its mandate on June 13, 2005 and, accordingly, on June 30, 2005, EPA
issued a final rule (70 FR 37698) revising the EPCRA section 313 list
of reportable chemicals in 40 CFR 372.65 to delete MEK.
    The deletion of MEK from the EPCRA section 313 list eliminates the
main source of data EPA uses to track MEK emissions. However, there are
other data sources available to estimate MEK emissions, including
market research data on MEK production, import, export, and
consumption. Consumption of MEK should provide an adequate surrogate
for emissions to determine whether significant increases in emissions
are occurring. If data indicate that MEK emissions are increasing
significantly, EPA has the option to add MEK back on the HAP list.
    Comment: One commenter suggested that the risk was not adequately
identified because the industry was not studied comprehensively enough
to determine chronic exposure.
    Response: In order to determine the risks from emissions of MEK,
the petitioner used the 1994 TRI as the basis of an emissions inventory
intended to quantify annual emissions of MEK, to identify and locate
emissions sources, and to acquire some facility-specific emissions
information. The 1994 TRI shows that there are over 2,000 sources with
reported emissions of MEK. The petition states that over 85 percent of
these facilities (approximately 1,700) emit 25 tpy or less. The
petition also states that approximately 800 facilities emit between 10
and 200 tpy, and 27 facilities emit 200 tpy or more. In addition to
using the 1994 TRI, the petitioner queried a subset of individual
sources to obtain site-specific source, release, and facility
information for the purpose of conducting more detailed risk
assessments. EPA has determined that this approach to establishing
reasonable worst-case exposures to MEK emissions is an adequate basis
upon which to base a decision to delist MEK. EPA states in the preamble
to the proposed rule that it does not interpret CAA section
112(b)(3)(C) to require absolute certainty that a pollutant will not
cause adverse effects on human health or the environment before it may
be deleted from the list. The use of the terms ``adequate and
``reasonably'' indicate that EPA must weigh the potential uncertainties
and likely significance. In this case, the uncertainty in the predicted
exposure levels is biased toward protecting public health. Therefore,
EPA concludes that delisting MEK is appropriate.
    Comment: Several commenters contended that chronic effects of MEK
had not been adequately studied or evaluated, and that the delisting
was not supported by new or compelling scientific evidence. One
commenter requested that EPA conduct long-term health effects studies.
Additionally, the commenters stated that there were no lifetime-chronic
studies included, no studies evaluating developmental effects, nor
studies concerning reproductive toxicity. Moreover, these commenters
asserted, there were no multigenerational studies included, and the
evaluation of the carcinogenic potential was not adequate.
    Response: EPA's RfC methodology (U.S. EPA, 1994) does not always
require a complete database in order to develop an RfC; however, the
database must at least meet minimum data requirements. For MEK, ``* * *
confidence in the database is medium * * *.'' (U.S. EPA, 2003). ``The
subchronic study by Cavender et al. (1983) satisfies the minimum
inhalation database requirements for derivation of an RfC.'' (U.S. EPA,
2003).
    In the case where there are enough quality data with which to set
an RfC, but where the database is less than complete, EPA adds a
database uncertainty factor to account for the lack of data. For MEK,
that factor is 10. EPA acknowledges the lack of a chronic toxicity
bioassay and an inhalation multigeneration reproductive toxicity study
(an oral multigeneration is available), but notes that contrary to the
commenters' statements, the developmental toxicity of MEK has been well
studied.
    As stated above, the RfC is an estimate (with uncertainty spanning
perhaps an order of magnitude) of a daily inhalation exposure to the
human population (including sensitive subgroups) that is likely to be
without an appreciable risk of deleterious effects during a lifetime.
Because maximum expected ambient air concentrations are well below the
RfC, EPA does not expect adverse noncancer effects to result.
    In addition, the health-protective nature of the assessment
described above adds to our confidence that no adverse health effects
will occur from ambient exposures to MEK.
    Comment: One commenter asserted that the appropriate averaging time
for assessing the potential for adverse developmental effects to occur
is the 24-hour average, not an annual average. The commenter held that
evaluating developmental toxicity on a 24-hour basis is supported by
EPA guidelines for evaluating developmental risk. This issue was also
raised by the VCCEP review panel as they considered the information
industry submitted on MEK and children's health.
    Response: EPA agrees with the commenter that potential concern for
developmental effects from short-term exposures should be addressed,
and EPA did so elsewhere in this preamble. With regard to the use of
endpoint-specific reference values, EPA's review of the RfD/RfC
processes recommended against the use of endpoint-specific reference
values, and instead recommended that duration-specific reference values
be derived in consideration of the full range of adverse effects.
    Comment: A commenter remarked that EPA did not take into account
all routes of exposure to MEK and, therefore, did not adequately
identify the risk.
    Response: MEK is neither bioaccumulative nor persistent. It has a
half-life of approximately 9 days. The releases of MEK to air are
unlikely to result in elevated concentrations in surface water, ground
water, or the food supply. Therefore, the route of exposure EPA is
concerned with is direct inhalation of MEK released to the ambient air.
For this reason, inhalation was the focus of the analysis. The
petitioner also assessed the potential for risks due to ingestion of
water contaminated with MEK. In both cases, the risks were below a
level of concern.
    Comment: One commenter asserted that the risk assessment did not
fully address: (1) Other solvents released from stationary and area
sources of MEK, (2) actual ambient concentrations near stationary and
area sources (only modeled concentrations were used), and (3) the human
health effects within the facilities as opposed to fenceline ambient
concentrations.
    Response: The maximum annual average air concentration resulting
from emissions of MEK is not expected to exceed an HQ of 0.2. This
value, which is 20 percent of the RfC, is quite low. EPA believes that
there is a large enough margin of exposure to preclude a need to
address any other emitted HAP that may affect the same target organ as
MEK.
    The petitioner did not monitor ambient air around actual MEK-
emitting facilities. Such an effort would not add to the analysis, or
change EPA's conclusion with regard to delisting. This is because the
maximum monitored concentration EPA found in the U.S. was over two
orders of magnitude below the maximum modeled concentration, and
because the modeling conducted was designed to over-estimate ambient
concentrations. For example, the model

assumed that individuals are continuously exposed to the maximum
modeled concentrations of MEK in air for 70 years, and EPA used the
maximum annual average concentration as a surrogate for long-term
exposure. Also, the model used 1994 emission rates which are
significantly higher than current emissions for the facility with the
highest estimated HQ of 0.2. EPA believes that the health-protective
air dispersion modeling performed as part of the petition and described
in detail in the proposed rule resulted in higher concentrations than
would monitoring around facilities.
    EPA cannot consider the health effects of emissions within facility
boundaries. That is the purview of the Occupational Safety and Health
Administration.
    Comment: One commenter recommended that a comparative analysis with
the 1998 Office of Pollution Prevention and Toxics (OPPT) assessment
(located in the docket) be done to fully assess the risks of MEK.
    Response: EPA agrees with the comment, and EPA conducted a
comparison of the 1998 OPPT assessment and the assessment in the
proposal to delist MEK.
    The assessment presented in the petition to delist MEK estimated a
maximum annual average MEK concentration of 1.2 mg/m3. It
used the ISCST3 model, which is a refined air dispersion model that
predicts an annual average by averaging 8,760 hours of real time
meteorological data. The ISCST3 model predicted a maximum 24-hour
average MEK concentration of 10 mg/m3.
    The 1998 OPPT study estimated maximum 24-hour average
concentrations of 100-200 mg/m3. It used a screening model
similar to the SCREEN3 model and predicted 1-hour average
concentrations under defined meteorological conditions with the
assumption that the receptor is always directly downwind from the
source. Such screening model runs typically result in high air
concentrations as compared to the ISCST3 model. EPA would expect the
difference in concentrations to be as high as a factor of 10. In
addition, the OPPT study applied a multiplicative factor to predict
typical (5), stagnant (10), and maximum (60) acute impacts. Thus, the
difference between the two model results can be attributed to the
multiplicative factors and differences between a refined and screening
model.
    Comment: One commenter recommended that EPA not wait for the formal
IRIS review of MEK or the VCCEP results to make a final decision
regarding delisting of MEK, as there was enough evidence to delist MEK
without the additional information. Another commenter asserted that if
the RfC resulting from the completed IRIS assessment is different from
the prospective RfC, then the petition should be reconsidered and an
additional public comment period should be allowed giving the public an
opportunity to comment on EPA's decision. This commenter also stated
that the results of the VCCEP should be concluded before the comments
on the delisting are due.
    Response: Regarding the first comment, EPA waited to make a final
decision to delist MEK until the 2003 IRIS RfC was determined and until
the information submitted by industry under the VCCEP was reviewed in
case the results of each of these processes altered our decision to
remove MEK from the HAP list.
    Regarding the second comment, EPA considers an additional comment
period unnecessary for a number of reasons. First, EPA explicitly
solicited comment on the effect of a difference between the prospective
RfC and the RfC resulting from the completed IRIS assessment. EPA
specifically requested comments on the decision in light of potential
values for the RfC of 9 mg/m3, 3 mg/m3 and 1 mg/
m3. The 2003 RfC of 5 mg/m3 is in the middle of
the range upon which EPA solicited comment. Second, while the 2003 RfC
is lower than the prospective RfC, the result of this change was only
to increase the HQ for the maximum annual average ambient exposure from
0.1 to 0.2 (20 percent of the RfC). This HQ is well below a level of
concern.
    In addition, EPA judges that the exposures to MEK of actual persons
living in the immediate vicinity of an MEK emission source would more
typically be at least a factor of 2 to 10 less than the predicted
maximum ambient concentration presented in the petition of 1 mg/
m3. This is because the concentration of MEK declines very
rapidly as the plume disperses, and the analysis showed that people do
not live at the point of maximum concentration. Therefore, actual
exposed individuals would be subject to MEK concentrations less than 1
mg/m3. If EPA were to replace the maximum ambient
concentration with a more realistic exposure scenario, it would yield
an HQ less than 0.2. Based on the current information, and given the
conservative nature of the parameters used to estimate the maximum
exposure, and because the petition and subsequent analyses characterize
the vast majority of MEK exposures from stationary sources, EPA
concludes that by applying the RfC of 5 mg/m3, potential
ambient exposures to MEK may not reasonably be anticipated to cause
adverse human health effects.
    With respect to the results of the VCCEP, EPA found it unnecessary
to extend the public comment period until after the review of the
industry-submitted information was complete. This is because the
industry provided no new information to EPA that was not already
available. Therefore, there was no new information upon which to
solicit comments.
    Comment: Many commenters noted that the interactions with n-hexane
and other ketones have not been sufficiently investigated should the
MEK emissions increase. These commenters stated that MEK interactions
with n-hexane have been shown to increase neurotoxicity of n-hexane.
    Response: EPA stated in the preamble to the proposed rule that MEK
has been shown to potentiate the neurotoxicity of other solvents in
experiments with laboratory animals when both MEK and the other solvent
are present in high concentrations. EPA also stated that studies of
occupationally-exposed populations (as reviewed by Noraberg and Alien-
Soborg, 2000) provide some evidence of possible interactions in humans.
EPA reviewed the occupational epidemiology literature in more depth
during the development of the 2003 RfC for MEK. These findings are
summarized in the Toxicological Review for MEK (http://www.epa.gov/iris/toxreviews/0071-tr.pdf
, section 4.4.4). Available occupational

studies involving multiple chemical exposures do not provide
information adequate to clearly establish an interaction between MEK
and other neurotoxic solvents in humans. In studies suggesting a
potential interaction, neurotoxicity has been observed only in
workplace populations exposed to solvent mixtures where reported MEK
air concentrations reached levels at or above the Threshold Limit Value
(TLV) (200 ppm or 590 mg/m3). EPA concluded that the
concerns for chemical interactions are especially diminished at the low
levels seen in this assessment: Less than 1 mg/m3 for
chronic exposures, 10 mg/m3 for 24-hour exposures and 25 mg/
m3 for a 1-hour exposure. These exposures are all well below
the reversible effects level of 590 mg/m3. Therefore, EPA
does not expect possible potentiation of n-hexane by MEK at the low
environmental concentrations that would be associated with industrial
releases.
    Comment: One commenter was concerned that MEK was detected by

the National Health and Nutrition Examination Survey in biomonitoring
programs.
    Response: EPA acknowledged in the preamble to the proposed rule
that MEK has been reported to be found in blood. EPA also stated that
the data indicated the source of the MEK is likely a by-product of
normal human metabolism, and it is reasonable to expect it did not
result from an air exposure to MEK at the concentrations seen in the
ambient air.
    Comment: One commenter requested that EPA consider the role of MEK
as an ozone precursor in deciding the petition.
    Response: EPA stated in the preamble to the proposed rule that it
was inappropriate to consider the role of MEK as an ozone precursor
because the ``dual structure (differentiating between HAP and criteria
pollutants/precursors) would lose its significance if EPA were to
include substances on the HAP list solely as a result of their
contribution to concentrations of criteria air pollutants.''
Specifically, the structure of the CAA is best protected by including
compounds on the HAP list only where such inclusion is warranted based
upon the HAP noncriteria pollutant related effects. This interpretation
is supported by the following prohibition related to listing of new HAP
contained in CAA section 112(b)(2): ``No air pollutant which is listed
under section 7408(a) of this title [the criteria pollutant list] may
be added to the list under this section, except that the prohibition of
this sentence shall not apply to any pollutant which independently
meets the listing criteria of this paragraph and is a precursor to a
pollutant which is listed under section 7408(a) * * *.''
    Comment: One commenter stated that decisions to list or delist are
governed by the precautionary principle. The commenter stated that,
``in considering whether a petitioner has met the heavy burden of
demonstrating that a substance should be removed from the hazardous air
pollutant list, the precautionary principle requires that EPA resolve
uncertainty in favor of more protection, not less. The recognition of
uncertainty in the listing and delisting process does not give EPA
discretion to delist a chemical based on incomplete and outdated
information as it has proposed to do with MEK.''
    Response: EPA does not believe it is appropriate to require that
all uncertainty be resolved in favor of not delisting. Such a
requirement of absolute certainty is inconsistent with our
interpretation of the requirement that to delist a HAP, EPA must
determine that there are ``adequate data on the health and
environmental effects of the substance to determine that emissions,
ambient concentrations, bioaccumulation or deposition of the substance
may not reasonably be anticipated to cause any adverse effect to human
health or adverse environmental effects.'' As explained in denying the
petition to delist methanol, EPA does ``not interpret CAA section
112(b)(3)(C) to require absolute certainty that the pollutant will not
cause adverse effects on human health * * * before it may be deleted
from the list. The use of the terms `adequate' and `reasonably'
indicate that EPA must weigh the potential uncertainties and their
likely significance.'' (See 66 FR 21929-21930, May 2, 2001.) For the
reasons explained above, EPA determined that this burden has been met
here. Responses with respect to the contention that the database was
outdated and/or incomplete are also addressed elsewhere is this
preamble.
    Comment: One commenter asserted that EPA has not adequately
considered the odor problems associated with MEK. The commenter stated
that odors can cause neurological problems such as fatigue, dizziness,
headache, and nausea resulting in a diminished quality of life. The
commenter also stated that odor thresholds for MEK have been reported
in the range of 6-250 mg/m3, and the estimates presented in
the proposed rule for a 1-hour maximum concentration near MEK sources
is 25 mg/m3, which is within the range of the reported odor
thresholds. The commenter also suggested that EPA recognize that the
risk to sensitive individuals could increase after delisting.
    Response: While EPA does not expressly consider odor as a health
endpoint, EPA considers the physiological effects of chemical
exposures, including the neurological effects that the commenter
described. In the proposed rule, EPA stated the following, ``The IRIS
assessment of MEK states that at present, there is no convincing
experimental evidence that MEK is neurotoxic * * * other than possibly
inducing CNS (central nervous system) depression at high exposure
levels.'' The IRIS documentation shows that no peripheral
neurohistopathological changes were reported in rats exposed
continuously to 3,320 mg/m\3\ of MEK for up to 5 months (Saida et al.,
1976). No treatment-related central or peripheral neurohistopathology
was observed in rats exposed for 90 days (6 hours/day, 5 days/week) at
concentrations of MEK as high as 14,865 mg/m\3\, even among animals in
animal tissues specifically prepared and examined for
neurohistopathology (Cavender et al., 1983). Also, ten of ten rats
exposed to MEK at 17,700 mg/m\3\ and higher for 8 hours/day, 7 days/
week, died in the seventh week of exposure without neurological
symptoms or histopathology (Altenkirch et al., 1978).
    Regarding sensitive individuals, EPA could not identify any
specific data that address the potential differences in susceptibility
to adverse effects from MEK exposure. In the MEK Toxicological Review
in support of the IRIS assessment, EPA did note that ``The potential
exists for increased susceptibility to neurotoxicity, hepatotoxicity,
and renal toxicity following exposure to MEK in combination with
certain other solvents * * *.'' The potentiating effects of MEK on the
toxicity of other solvents have only been demonstrated at relatively
high exposure concentrations (200-1,000 ppm or 590-2950 mg/m\3\).
    Comment: One commenter recommended changing the hazardous waste
regulations that apply to MEK as follows: Remove MEK as a listed
toxicity characteristic in 40 CFR 261.64; remove MEK as a toxic
constituent in part 261, appendix VIII; and remove MEK from the F005
listing, but it may be appropriate to add it to F2003 listing.
    Response: EPA was petitioned under CAA section 112(b)(3) to remove
MEK from the CAA section 112 HAP list. This is the only action under
consideration as part of the final rule.

VI. Final Rule

A. Rationale for Action

    The detailed factual rationale for supporting EPA's initial
determination that the criterion in CAA section 112(b)(3)(C) had been
met is set forth in the proposed rule published in the Federal Register
on May 30, 2003 (68 FR 32606). Although, as described above, EPA has
done some additional analysis pursuant to public comments received on
the subsequent action, none of those comments nor EPA analyses have
caused EPA to revise the scientific basis upon which that initial
determination was predicated. Except as modified or clarified above,
EPA hereby incorporates into its rationale for the final rule the
substantive assessment of potential hazards, projected exposures, human
risk, and environmental effects set forth in the proposed rule to
delist MEK. Based on that assessment, EPA's evaluation of the comments
and additional information submitted during the rulemaking process (as
summarized above), and on other materials, EPA has made a determination
that there are

adequate data on the health and environmental effects of MEK to
determine that emissions, ambient concentrations, bioaccumulation, or
deposition of the compound may not reasonably be anticipated to cause
adverse human health or environmental effects.

B. Effective Date

    The final rule will be effective on December 19, 2005. Although
section 553(d) of the Administrative Procedure Act, 5 U.S.C. 553(d),
provides that substantive rules must be published at least 30 days
prior to their effective date, this requirement does not apply to this
action. First, the final rule was promulgated pursuant to CAA section
307(d), and that provision expressly states that the provisions of
section 553 of the Administrative Procedure Act do not apply to this
action. Second, even under section 553, the requirement that a rule be
published 30 days prior to its effective date does not apply to a rule,
``which grants or recognizes an exemption or relieves a restriction.''

VII. References

Altenkirch, H., G. Stoltenburg, and H.M. Wagner. (1978) Experimental
studies on hydrocarbon neuropathies induced by methyl-ethyl-ketone
(MEK). J Neurol 219:159-70.
Cavender, F.L., H.W. Casey, H. Salem, et al. (1983) A 90-day vapor
inhalation toxicity study of methyl ethyl ketone. Fundam Appl
Toxicol 3(4):264-70.
Cox, G.E., D.E. Bailey, and K. Morgareidge. (1975) Toxicity studies
in rats with 2-butanol including growth, reproduction and
teratologic observations. Food and Drug Research Laboratories, Inc.
Waverly, NY. Report No. 91MR R 1673.
Deacon, M.M., Pilny, M.D., John, J.A., et al. (1984) Embryo- and
Fetotoxicity of Inhaled Methyl Ethyl Ketone in Rats. Toxicol Appl
Pharmacol 59:620-22.
Dick, R.B., E.F. Krieg Jr., J. Setzer, B. Taylor. (1992)
Neurobehavioral effects from acute exposures to methyl isobutyl
ketone and methyl ethyl ketone. Fundam Appl Toxicol 19(3):453-73.
Lowengart, R.A., J.M. Peters, C. Cicioni, et al. (1987) Childhood
leukemia and parents' occupational and home exposures. J Natl Canc
Inst 79(1):39-46.
Noraberg, J., Arlien-S[oslash]borg, P. (2000) Neurotoxicology
21(3):409-18.
OECD. (1997) SIDS Screening Information Assessment Report for Methyl
Ethyl Ketone. (SIAM 6 1997)
Saida, K., J.R. Mendell, and H.S. Weiss. (1976) Peripheral nerve
changes induced by methyl n-butyl ketone and potentiation by methyl
ethyl ketone. J Neuropath Exp Neurol 35(3):205-25.
Schwetz, B.A., Leong, B.K.J, Gehring, P.J. (1974) Embryo- and
Fetotoxicity of Inhaled Carbon Tetrachloride, 1,1-dicloroethane and
Methyl Ethyl Ketone in Rats. Toxicol Appl Pharmacol 28:452-64.
Schwetz, B.A., T.J. Mast, R.J. Weigel, et al. (1991) Developmental
toxicity of inhaled methyl ethyl ketone in mice. Fundam Appl Toxicol
16:742-8.
U.S. EPA. (1992) Integrated Risk and Information System. Online at:
http://www.epa.gov/iris/subst/0071.htm.

U.S. EPA. (1994) Methods for Derivation of Inhalation reference
Concentrations and Application of Inhalation Dosimetry. EPA/600/8-
90/066F. Online at http://cfpub2.epa.gov/ncea/raf/recordisplay.cfm?deid=71993
.

U.S. EPA. (1999) Guidelines for Carcinogen Risk Assessment [Review
Draft]. Risk Assessment Forum. NCEA-F-0644 http://www.epa.gov/ncea/raf/cancer/htm
.

U.S. EPA. (2000) Benchmark Dose Technical Guidance Document
[External Review Draft]. Online at: http://cfpub2.epa.gov/ncea/raf/recordisplay.cfm?deid=20871
.

U.S. EPA. (2002) A Review of the Reference Dose and Reference
Concentration Processes. EPA/630/P-02/002F. Online at: http://cfpub2.epa.gov/ncea/raf/recordisplay.cfm?deid=55365
.

U.S. EPA (2003) Toxicological Review of Methyl Ethyl Ketone. EPA
635/R-03/009 Online at: http://www.epa.gov/iris.

Woo, Y-T., D. Lai, J.L. McLain, et al. (2002) Use of mechanism-based
structure-activity relationships analysis in carcinogenic potential
ranking for drinking water disinfection by-products. Environ Health
Persp 110 (Suppl. 1):75-8.
Zimmermann, F.K., Mayer, V.M., Scheel, I., et al. (1985) Acetone,
methyl ethyl ketone, ethyl acetate, acetonitrile and other polar
aprotic solvents are strong inducers of aneuploidy in Saccharomyces
cerevisiae. Mutat Res 149(3):339-351.

VIII. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), EPA
must determine whether the regulatory action is ``significant'' and,
therefore, subject to Office of Management and Budget (OMB) review and
the requirements of the Executive Order. The Executive Order defines
``significant regulatory action'' as one that is likely to result in a
rule that may:
    (1) Have an annual effect on the economy of $100 million or more or
adverse affect in a material way the economy, a sector to the economy,
productivity, competition, jobs, the environment, public health or
safety, or state, local or tribal governments or communities;
    (2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
    (3) Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs, or the rights and obligation of recipients
thereof; or
    (4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
    It has been determined that this rule is not a ``significant
regulatory action'' under the terms of Executive Order 12866 and is,
therefore, not subject to OMB review.

B. Paperwork Reduction Act

    Today's final action does not impose an information collection
burden under the provisions of the Paperwork Reduction Act, 44 U.S.C.
3501 et seq. The final action will remove MEK from the CAA section
112(b)(1) HAP list and, therefore, eliminate the need for information
collection under the CAA. Burden means the total time, effort, or
financial resources expended by persons to generate, maintain, retain,
or disclose or provide information to or for a Federal agency. This
includes the time needed to review instructions; develop, acquire,
install, and utilize technology and systems for the purposes of
collecting, validating, and verifying information, processing and
maintaining information, and disclosing and providing information;
adjust the existing ways to comply with any previously applicable
instructions and requirements; train personnel to be able to respond to
a collection of information; search data sources; complete and review
the collection of information; and transmit or otherwise disclose the
information. An agency may not conduct or sponsor, and a person is not
required to respond to a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations are listed in 40 CFR part 9 and 48 CFR chapter 15.

C. Regulatory Flexibility Act (RFA)

    EPA has determined that it is not necessary to prepare a regulatory
flexibility analysis in connection with this final rule. For purposes
of assessing the impacts of today's rule on small entities, small
entity is defined as: (1) A small business as defined by the Small
Business Administrations' regulations at 13 CFR 121.201; (2) a small
governmental jurisdiction that is a government of a city, county, town,
school district or special district with a population of less than
50,000; and (3) a small organization that is any not-for-profit
enterprise which is independently owned and operated and is not
dominant in its field.

    After considering the economic impacts of today's final rule on
small entities, EPA has concluded that this action will not have a
significant economic impact on a substantial number of small entities.
In determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the proposed rule on small entities.'' 5 U.S.C.
sections 603 and 604. Thus, an agency may conclude that a rule will not
have a significant economic impact on a substantial number of small
entities if the rule relieves regulatory burden, or otherwise has a
positive economic effect on all of the small entities subject to the
rule.
    The final rule will eliminate the burden of additional controls
necessary to reduce MEK emissions and the associated operating,
monitoring and reporting requirements. EPA has, therefore, concluded
that today's final rule will relieve regulatory burden for all small
entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 1044, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, EPA
generally must prepare a written statement, including a cost-benefit
analysis, for final and final rules with ``Federal mandates'' that may
result in expenditures to State, local, and tribal governments, in the
aggregate, or to the private sector, of $100 million or more in any 1
year. Before promulgating an EPA rule for which a written statement is
needed, section 205 of the UMRA generally requires EPA to identify and
consider a reasonable number of regulatory alternatives and adopt the
least costly, most cost-effective or least burdensome alternative that
achieves the objectives of the rule. The provisions of section 205 do
not apply when they are inconsistent with applicable law. Moreover,
section 205 allows EPA to adopt an alternative other than the least
costly, most cost-effective or least burdensome alternative if the
Administrator publishes with the final rule an explanation why that
alternative was not adopted. Before EPA establishes any regulatory
requirements that may significantly or uniquely affect small
governments, including tribal governments, it must have developed under
section 203 of the UMRA a small government agency plan. The plan must
provide for notifying potentially affected small governments, enabling
officials of affected small governments to have meaningful and timely
input in the development of EPA regulatory proposals with significant
Federal intergovernmental mandates, and informing, educating, and
advising small governments on compliance with the regulatory
requirements.
    Today's final rule contains no Federal mandates for State, local,
or tribal governments or the private sector. The final rule imposes no
enforceable duty on any State, local or tribal governments or the
private sector. In any event, EPA has determined that the final rule
does not contain a Federal mandate that may result in expenditures of
$100 million or more for State, local, and tribal governments, in the
aggregate, or the private sector in any 1 year. Because the final rule
removes a compound previously labeled in the CAA as a HAP, it actually
reduces the burden established under the CAA. Thus, today's final rule
is not subject to the requirements of sections 202 and 205 of the UMRA.
Since the final rule contains no Federal mandates and imposes no
enforceable duties on any entity, EPA has determined that this rule
contains no regulatory requirements that might significantly or
uniquely affect small governments.

E. Executive Order 13132, Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.''
``Policies that have federalism implications'' is defined in the
Executive Order to include regulations that have ``substantial direct
effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.''
    The final rule does not have federalism implications. It will not
have substantial direct effects on the States, on the relationship
between the national government and the States, or on the distribution
of power and responsibilities among the various levels of government,
as specified in Executive Order 13132. Today's final rule removes the
substance MEK from the list of HAP contained under section 112(b)(1) of
the CAA. It does not impose any additional requirements on the States
and does not affect the balance of power between the States and the
Federal government. Thus, Executive Order 13132 does not apply to this
rule.

F. Executive Order 13175, Consultation and Coordination With Indian
Tribal Governments

    Executive Order 13175 (65 FR 67249, November 9, 2000), requires EPA
to develop an accountable process to ensure ``meaningful and timely
input by tribal officials in the development of regulatory policies
that have tribal implications.'' The final rule does not have tribal
implications, as specified in Executive Order 13175.
    A review of the available emission inventory does not indicate
tribal MEK emissions sources subject to control under the CAA and,
therefore, the final rule is not anticipated to have tribal
implications. In addition, the final rule will eliminate control
requirements for MEK and, therefore, reduce control costs and reporting
requirements for any tribal entity operating a MEK source subject to
control under the CAA which EPA might have missed. Thus, Executive
Order 13175 does not apply to the final rule.

G. Executive Order 13045, Protection of Children From Environmental
Health Risks and Safety Risks

    Executive Order 13045 (62 FR 19885, April 23, 1997) applies to any
rule that: (1) Is determined to be ``economically significant'' as
defined under Executive Order 12866, and (2) concerns an environmental
health or safety risk that EPA has reason to believe may have a
disproportionate effect on children. If the regulatory action meets
both criteria, EPA must evaluate the environmental health or safety
effects of the planned rule on children, and explain why the planned
regulation is preferable to other potentially effective and reasonably
feasible alternatives considered by the Agency.
    EPA interprets Executive Order 13045 as applying only to those
regulatory actions that are based on health or safety risks, such that
the analysis required under section 5-501 of the Executive Order has
the potential to influence the regulation. The final rule is not
subject to Executive Order 13045 because it is not economically
significant as defined in Executive Order 12866, and because EPA does
not have reason to believe the environmental health or safety risks
addressed by this action present a disproportionate risk to children.
This determination is based on the fact that the RfC is determined to
be protective of sensitive sub-populations, including

children. Also, the single study cited during public comment to
indicate a potential effect on children has been reviewed during this
petition process and found to be limited in design and execution.
Consequently, EPA determined that the study was of insufficient quality
to provide information regarding health risks (leukemia) of MEK to
children. Also, EPA evaluated industry's submission to the first tier
of the VCCEP program and has determined that there are no data which
specifically indicate that the RfC will not be protective of children.

H. Executive Order 13211, Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use

    The final rule is not subject to Executive Order 13211, ``Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use'' (66 FR 28355 (May 22, 2001)) because it is not a
significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 112(d) of the National Technology Transfer and Advancement
Act of 1995 (NTTAA), Public Law 104-113, section 12(d) 915 U.S.C. 272
note), directs all Federal agencies to use voluntary consensus
standards instead of government-unique standards in their regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., material specifications, test method, sampling and
analytical procedures, business practices, etc.) that are developed or
adopted by one or more voluntary consensus standards bodies. Examples
of organizations generally regarded as voluntary consensus standards
bodies include the American society for Testing and Materials (ASTM),
the National Fire Protection Association (NFPA), and the Society of
Automotive Engineers (SAE). The NTTAA requires Federal agencies like
EPA to provide Congress, through OMB, with explanations when an agency
decides not to use available and applicable voluntary consensus
standards. The final rule does not involve technical standards.
Therefore, EPA is not considering the use of any voluntary consensus
standards.

J. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing today's final rule
and other required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. This action is not
a ``major rule'' as defined by 5 U.S.C. 804(2). The final rule will be
effective on December 19, 2005.

List of Subjects in 40 CFR Part 63

    Environmental protection, Air pollution control, Hazardous
substances, Reporting and recordkeeping requirements.

    Dated: December 13, 2005.
Stephen L. Johnson,
Administrator.

0
For the reasons set out in the preamble, part 63, title 40, chapter I
of the Code of Federal Regulations is amended as follows:

PART 63--[AMENDED]

0
1. The authority citation for part 63 continues to read as follows:

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

Subpart C--[Amended]

0
2. Subpart C is amended by adding Sec.  63.61 to read as follows:

Sec.  63.61  Deletion of methyl ethyl ketone from the list of hazardous
air pollutants.

    The substance methyl ethyl ketone (MEK, 2-Butanone) (CAS Number 78-
93-3) is deleted from the list of hazardous air pollutants established
by 42 U.S.C. 7412(b)(1).

[FR Doc. 05-24200 Filed 12-16-05; 8:45 am]

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[Federal Register Volume 85, Number 2 (Friday, January 3, 2020)]
[Proposed Rules]
[Page 265]
[FR Doc No: 2019-27922]

========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.

========================================================================

Federal Register / Vol. 85, No. 2 / Friday, January 3, 2020 /
Proposed Rules

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 35

[Docket No. RM01-8-012]

Revised Public Utility Filing Requirements for Electric Quarterly
Reports

AGENCY: Federal Energy Regulatory Commission, Department of Energy.

ACTION: Withdrawal of notice of proposed rulemaking and termination of
rulemaking proceeding.

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

SUMMARY: The Commission withdraws a notice of proposed rulemaking,
which proposed to revise the Electric Quarterly Report (EQR) Data
Dictionary to add ``Simultaneous Exchange'' to the list of available
Product Names in the EQR.

DATES: This withdrawal will become effective February 3, 2020.

FOR FURTHER INFORMATION CONTACT:  Suthima Malayaman (Legal
Information), Office of the General Counsel, Federal Energy Regulatory
Commission, 888 First Street NE, Washington, DC 20426,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:
    1. On March 15, 2012, the Commission issued a Notice of Proposed
Rulemaking (NOPR) in this proceeding.\1\ For the reasons set forth
below, we are exercising our discretion to withdraw the NOPR and
terminate this rulemaking proceeding.
---------------------------------------------------------------------------

    \1\ Revised Public Utility Filing Requirements for Electric
Quarterly Reports, 77 FR 16494 (Mar. 21, 2012), FERC Stats. & Regs.
] 32,687 (2012).
---------------------------------------------------------------------------

I. Background

    2. In the NOPR, the Commission proposed to revise the Electric
Quarterly Report (EQR) Data Dictionary to add ``Simultaneous Exchange''
to the list of available Product Names in the EQR and to require all
EQR filers to use this term, when appropriate, in the Contract Data
section and the Transaction Data section of the EQR.\2\ The Commission
stated that, simultaneous exchanges, which occur in both organized and
non-organized energy markets, are complicated and varied. The
Commission expressed its concern that the complexity of simultaneous
exchanges may obscure the true nature of these transactions, and may
enable market participants to circumvent market rules. Thus, in order
to enhance transparency, the Commission asserted that it is important
that EQR filers report simultaneous exchanges in the EQR.
---------------------------------------------------------------------------

    \2\ Id. P 6. The Commission proposed the following definition:
``Simultaneous exchanges occur when a pair of simultaneously
arranged (i.e., part of the same negotiations) wholesale power
transactions between the same counterparties in which party A sells
an electricity product to party B at one location and party B sells
a similar electricity product to party A at a different location
have an overlapping delivery period. The simultaneous exchange is
the overlapping portion (both in volume and delivery period) of
these wholesale power transactions.'' Id.
---------------------------------------------------------------------------

    3. The Commission clarified that only the overlapping portion of a
simultaneous exchange transaction should be reported as a simultaneous
exchange.\3\ In addition, the Commission proposed that non-overlapping
portions of the arrangements should be reported in a separate entry as
a power sale.
---------------------------------------------------------------------------

    \3\ Id. P 9.
---------------------------------------------------------------------------

    4. The Commission further proposed that parties reporting
simultaneous exchange transactions report the price spread for these
transactions, rather than the price assigned by the parties of the
individual power sales that make up the simultaneous exchange.\4\ The
Commission stated that, for the parties to a simultaneous exchange
transaction, prices assigned to the power at either point in the
transaction (if applicable) do not necessarily represent the economic
values of the power being exchanged at those points. Thus, to ensure
the presence of meaningful price information in EQR, the Commission
proposed to adopt the requirement that EQR filers report the price
spread of each simultaneous exchange.
---------------------------------------------------------------------------

    \4\ Id. P 10.
---------------------------------------------------------------------------

    5. Finally, the Commission proposed to require each party entering
into a simultaneous exchange to report both the point of delivery and
the point of receipt associated with the simultaneous exchange
transaction.\5\
---------------------------------------------------------------------------

    \5\ Id. P 12.
---------------------------------------------------------------------------

II. Discussion

    6. Subsequent to the issuance of the NOPR, significant changes have
occurred in the way power is exchanged in markets across the country.
For instance, in November 2014, the California Independent System
Operator Corporation and PacifiCorp launched the Western Energy
Imbalance Market (EIM).\6\ The EIM provides EQR-reportable products
that are similar to simultaneous exchange transactions, and the
availability of these products may have reduced the use of simultaneous
exchange transactions. As a result, we conclude that it is no longer
necessary to adopt the regulation proposed in the NOPR. We therefore
withdraw the NOPR and terminate this rulemaking proceeding.
---------------------------------------------------------------------------

    \6\ Cal. Indep. Sys. Operator Corp., 147 FERC ] 61,231 (2014).
As of 2019, the EIM now has nine active participants.
---------------------------------------------------------------------------

    The Commission orders: The Notice of Proposed Rulemaking is hereby
withdrawn and Docket No. RM01-8-012 is hereby terminated.

    By direction of the Commission.

    Issued: December 19, 2019.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2019-27922 Filed 1-2-20; 8:45 am]
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