Response to Comments on Proposed Sell-Through Amendment and Pellet Fuel Requirements in the `Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces'

U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Sector Policies and Programs Division
Research Triangle Park, NC

March 10, 2020

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                                   FOREWORD

This document summarizes the public comments and provides the EPA's responses to those comments regarding EPA's Sell-Through Final Rule for the Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces. The EPA published the Proposed Rule in the Federal Register on November 30, 2018 (83 FR 61574). The EPA received comments on the proposed rule via e-mail, mail, facsimile, and at a public hearing held in Washington, D.C. on December 17, 2018. Copies of all comments submitted and transcripts for the public hearings are available at the EPA Docket Center Public Reading Room and are also available electronically through http://www.regulations.gov by searching Docket ID EPA-HQ-OAR-2018-0195.

This document contains responses to comments on the proposed two-year retail sell-through amendment and on the pellet fuel requirements in the New Residential Wood Heaters NSPS (40 CFR part 60, subparts AAA and QQQQ). The EPA provided rationale for its decision regarding this proposed action in the preamble of the final rule. This document contains a summary of all issues raised by commenters, extracted from the original letters and public hearing transcripts.

For each comment, the Document Control Number (DCN) is provided in parentheses along with the comment summary. The text within the comment summaries is provided by the commenter(s) and represents their opinion(s), regardless of whether the summary specifically indicates that the statement is from a commenter(s) (e.g., "The commenter stated" or "The commenters asserted"). The comment summaries do not represent the EPA's opinion unless the response to the comment specifically agrees with all or a portion of the comment. In some cases, the same comment was submitted by two or more commenters through submittal of a form letter prepared by an organization, by the commenter incorporating by reference the comments in another comment letter, or by the commenter providing identical or similar language independently. Rather than repeat these comment excerpts for each commenter, the comment summary is provided only once.

The EPA's responses to comments are provided immediately following each comment summary. In instances where several commenters raised similar or related issues, the EPA has grouped these comments together and provided a single response after the last comment summary or excerpt in the group. It should be noted that the EPA does not individually identify every commenter who made a certain point in all instances, particularly in cases where multiple commenters express essentially identical arguments. Finally, the EPA provided rationale for this final action in the preamble to the final rulemaking. Although portions of the preamble are paraphrased in this document, to the extent any ambiguity is introduced by this paraphrasing, the preamble itself remains the definitive statement of the rationale for this final action.

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Table of Contents
1.0 	Introduction	1
2.0 	Legality of the Sell-Through Amendment under the Clean Air Act and other Statutes	6
2.1	The Sell-Through Amendment is Permissible under the CAA	6
2.1.1 Comment: Nothing in the CAA limits EPA's authority to stagger compliance deadlines	6
2.1.2 Comment: EPA has authority under Section 111 to revise the existing NSPS and cure defect in 2015 NSPS by adding sell-through provisions	7
2.2 	The Sell-Through Amendment is not Permissible under the CAA and other Statutes	11
2.2.1 Comment: The proposal is arbitrary and capricious in violation of the Administrative Procedure Act	12
2.2.2 Comment: The proposal fails to meet the procedural requirements of the CAA	18
2.2.3 Comment: The proposal imposes public health and environmental harm on society contrary to CAA's statutory mandate and Agency guidance	24
2.2.4 Comment: EPA does not have authority to extend a sell-through period under the CAA or under consumer protection laws	30
2.2.5 Comment: The proposal would increase emissions in non-attainment areas in violation of the CAA	34
2.3	The Sell-Through as a Component of the Best Systems of Emission Reduction (BSER) Determination	39
2.3.1 Comment: The CAA requires EPA to demonstrate that the proposed revision reflects BSER	40
2.3.2 Comment: The sell-through is part of the already established five-year lead time of BSER	47
2.4	Supplemental Regulatory Impact Analysis (RIA) Comments	56
2.4.1 Comment: The truncated RIA cost-benefit analysis fails to evaluate all pollutant emissions and underestimates environmental and societal costs	56
2.4.2 Comment: The RIA scenario assumptions are not supported and underestimate environmental and societal costs	65
2.4.3 Comment: The RIA fails to evaluate how Step 1 devices will compete with Step 2 devices, to the potential detriment of those manufacturers who have invested in Step 2 technology	72
2.4.4 Comment: The RIA overstates the cost savings to manufacturers	74
2.4.5 Comment: The RIA fails to analyze impacts on sub-populations of concern	75
2.4.6 Comment: The RIA fails to evaluate consumer behavior	82
2.4.7 Comment: The RIA fails to evaluate the costs to state and local governments	83
2.4.8 Comment: The RIA fails to account for incentive programs	85
3.0	Support for Sell-Through	86
3.1	Support for Sell-Through for All Wood Heating Devices	86
3.1.1 Comment: EPA's rationale for proposed sell-through applies to all regulated wood heating devices, under both QQQQ and AAA	86
3.1.2 Comment: Sell-through necessary to allow retailers to continue to purchase and sell Step 1 heaters, so manufacturers can fund Step 2 model development and certification	87
3.1.3 Comment: Sell-through necessary to allow retailers and manufacturers to continue generating revenue and avoid economic harm from stranded inventory	92
3.1.4 Comment: Sell-through necessary to provide consumers affordable choices	96
3.1.5 Comment: Sell-through will not significantly increase emissions because it allows Step 1 models to replace older pre-NSPS models	98
3.1.6 Comment: Suggested length of sell-through	102
3.2	Support for Sell-Through for Hydronic Heaters	105
3.2.1 Comment: Sell-through necessary to allow retailers to continue to purchase Step 1 hydronic heaters so manufacturers can fund Step 2 model development and certification	106
3.2.2 Comment: Sell-through necessary to allow retailers and hydronic heater manufacturers to continue generating revenue and avoid economic harm from stranded inventory	107
3.2.3 Comment: Sell-through will provide manufacturers with the extra time they need to bring Step 2 hydronic heaters to market	109
3.2.4 Comment: Sell-through necessary to provide consumers affordable choices	110
3.2.5 Comment: Sell-through would have negligible environmental impacts	111
3.2.6 Comment: Suggested length of hydronic heater sell-through	111
3.3	Support for Sell-Through for Forced-Air Furnaces	112
3.3.1 Comment: Sell-through necessary to allow retailers to continue to purchase Step 1 forced-air furnaces so manufacturers can fund Step 2 model development and certification	113
3.3.2 Comment: Sell-through necessary to allow retailers and forced-air furnace manufacturers to continue generating revenue and avoid economic harm from stranded inventory	113
3.3.3 Comment: Sell-through necessary to provide consumers affordable choices	115
3.3.4 Comment: Suggested length of forced-air furnace sell-through	116
3.4	Support for Sell-Through for Wood Heaters under AAA	118
3.4.1 Comment: Sell-through necessary to allow retailers to continue to purchase Step 1 heaters so manufacturers can fund Step 2 model development and certification	118
3.4.2 Comment: Sell-through necessary to allow retailers and manufacturers to continue generating revenue and avoid economic harm from stranded inventory and layoffs	120
3.4.3 Comment: Sell-through necessary to provide consumers affordable choices	124
3.4.4 Comment: Lack of sell-through will cause consumers to use higher emitting wood heaters	126
3.4.5 Comment: Sell-through would have negligible environmental impacts	127
3.4.6 Comment: Suggested length of sell-through for AAA wood heaters	128
4.0	Opposition to Sell-Through	131
4.1	Opposition to Sell-Through for All Wood Heating Devices	131
4.1.1 Comment: Manufacturers have had sufficient time already to meet the standards, some models already do, and there is no new rationale to justify the sell-through	131
4.1.2 Comment: Sell-through financially penalizes manufacturers that have made investments to develop Step 2-compliant models	137
4.1.3 Comment: Sell-through will cause states and localities to initiate more stringent and separate certification programs and more intrusive government actions	141
4.1.4 Comment: Sell-through will significantly and unnecessarily increase pollution and public health hazards and damage property values	143
4.2	Opposition to Sell-Through for Hydronic Heaters	160
4.2.1 Comment: Manufacturers have had sufficient time already to meet the standards and some models already do	160
4.2.2 Comment: Sell-through financially penalizes hydronic heater manufacturers that have made investments to develop Step 2-compliant models	162
4.2.3 Comment: Sell-through will significantly and unnecessarily increase pollution and public health hazards	163
4.2.4 Comment: Sell-through not necessary for hydronic heater retailers	165
4.2.5 Comment: Sell-through not necessary for consumers because retail prices will not generally increase	166
4.3	Opposition to Sell-Through for Forced-Air Furnaces	166
4.3.1 Comment: Sell-through financially penalizes forced-air furnace manufacturers that have made investments to develop Step 2-compliant models	166
4.3.2 Comment: Sell-through not necessary or feasible for forced-air furnace retailers	167
4.3.3 Comment: Sell-through will unreasonably delay emission reductions	167
4.4	Opposition to Sell-Through for Wood Heaters under AAA	168
4.4.1 Comment: Manufacturers have had sufficient time already to meet the standards and many models already do	168
4.4.2 Comment: Sell-through financially penalizes manufacturers that have made investments to develop Step 2-compliant models	170
4.4.3 Comment: Sell-through will significantly and unnecessarily increase pollution and public health hazards	171
4.4.4 Comment: Sell-through will eliminate the significant emission reductions achieved when transitioning from Step 1 to Step 2-compliant wood heaters	172
4.4.5 Comment: Sell-through not necessary for retailers because there is ample time to sell-off non-compliant inventory	173
4.4.6 Comment: Sell-through not necessary for consumers because retail prices will not generally increase	173
5.0	Wood Heating Device Step 1 and Step 2 Statistics	175
5.1	Hydronic Heater Step 1 and Step 2 Statistics	175
5.1.1 Comment: Step 2 hydronic heater models designed and certified	175
5.1.2 Comment: Step 1 and Step 2 hydronic heater models available at retailers	177
5.1.3 Comment: Inventory carryover, selling season, and decline in purchases by retailers of Step 1 hydronic heaters	178
5.1.4 Comment: Time required for EPA certification of hydronic heater models	182
5.2	Forced-Air Furnace Step 1 and Step 2 Statistics	183
5.2.1 Comment: Step 2 forced-air furnace models designed and certified	183
5.2.2 Comment: Step 1 and Step 2 forced-air furnace models available at retailers	185
5.2.3 Comment: Inventory carryover, selling season, and decline in purchases by retailers of Step 1 forced-air furnaces	186
5.2.4 Comment: Time required for EPA certification of forced-air furnace models	191
5.2.5 Comment: Cost to certify forced-air furnace model line	191
5.3	Wood Heater Step 1 and Step 2 Statistics (AAA)	192
5.3.1 Comment: Step 2 AAA models designed and certified	192
5.3.2 Comment: Step 1 and Step 2 AAA models available at retailers	196
5.3.3 Comment: Time needed to sell-off Step 1 models	199
5.3.4 Comment: Inventory carryover, selling season, and decline in purchases by retailers of Step 1 AAA devices	199
5.3.5 Comment: Shift to pellet heaters from cord wood heaters	207
5.3.6 Comment: Time required for EPA certification of AAA models	207
6.0	Support for Retaining or Revising Pellet Fuel Requirements	210
6.1	Pellet Requirements Should Be Retained	210
6.1.1 Comment: Pellet requirements are needed to ensure consistent operation and emissions performance to safeguard public health	210
6.1.2 Comment: Retention of trace metals, sulfur, chlorine, ash and fines requirements	212
6.2	Pellet Requirements Should Be Revised	213
6.2.1 Comment: Reasons for strengthening pellet fuel requirements	213
6.2.2 Comment: Maximum length restriction should be eliminated	215
6.2.3 Comment: Fines restriction should be revised	215
6.2.4 Comment: Trace metal restrictions should be retained and strengthened	216
6.2.5 Comment: Ash content restriction should be revised	217
6.2.6 Comment: Demolition /construction waste restrictions should be retained and strengthened	217
6.2.7 Comment: Prohibited fuel list should be revised regarding pallets and seasoned wood prohibitions	218
6.2.8 Comment: Quality assurance program requirements should be revised	221
7.0	Support for Eliminating Pellet Fuel Requirements	223
7.1	The Pellet Fuel Requirements are not Permissible under the CAA	223
7.1.1 Comment: EPA lacks legal authority under the CAA to regulate pellet fuel, did not analyze BSER, unjustifiably regulates a commercial product in homes and must repeal the requirements entirely.	223
7.1.2 Comment: EPA cannot prescribe a specific technology for compliance with a standard under CAA section 111 and doing so precludes innovation	234
7.1.3 Comment: EPA's differential regulation of pellet fuel versus other wood fuels in the same source category is not permitted by the CAA	239
7.1.4 Comment: The pellet fuel requirements cannot be justified on the basis of cost effectiveness	242
7.1.5 Comment: The pellet fuel requirements are unenforceable	244
7.1.6 Comment: EPA provides no basis of information for either retaining or revising the existing pellet fuel standards	246
7.2	The EPA Should Merely Reference the Pellet Fuel Institute's Standards	249
7.2.1 Comment: Referencing PFI's standards in lieu of static requirements allows innovation	249
8.0	Other & Miscellaneous Comments	251
8.1	Other Types of Relief in Lieu of Sell-Through	251
8.1.1 Comment: Other types of relief in lieu of sell-through for hydronic heaters	251
8.1.2 Comment: Other types of relief in lieu of sell-through for AAA wood heaters	252
8.2	Request for Extending the Comment Period and/or Additional Public Hearings	252
8.2.1 Comment: Request for or opposition to an extended comment period	253
8.2.2 Comment: Request for or opposition to an additional public hearing	254
8.3 	Miscellaneous Comments	254
8.3.1 Comment: EPA should focus resources on test methods	254
8.3.2 Comment: EPA should focus resources on compliance and enforcement	255
8.3.3 Comment: Wood heating should be regulated locally not nationally	257
8.3.4 Comment: Wood is a renewable resource and there are more pressing problems than wood heating	258
8.3.5 Comment: Banning wood heating	260
Appendix A: Complete List of Commenters	262

1.0 	Introduction
On November 30, 2018 (83 FR 61574), the U.S. Environmental Protection Agency (EPA) proposed to amend the 2015 New Source Performance Standards (NSPS) for new residential hydronic heaters and new forced-air furnaces by adding a two-year "sell-through" period for all affected new hydronic heaters and forced-air furnaces that are manufactured or imported before the May 2020 compliance date to be sold at retail through May 2022. This proposal would allow retailers additional time, after the May 2020 effective date of the "Step 2" standards, for the sale of Step 1-compliant hydronic heaters and forced-air furnaces remaining in inventory. The EPA also took comment on whether a sell-through period for all affected new residential wood heaters is appropriate following the May 2020 compliance date and, if so, how long a sell-through period is needed and why. In addition, this action took comment on whether the current minimum pellet fuel requirements should be retained and, if so, whether they should be revised.

This Response to Comment (RTC) document provides excerpts and summaries of public comments and the EPA's responses to these comments regarding the proposed rulemaking. The docket for this rule, which includes supporting documents as well as public comments, is available on Regulations.gov, docket ID number EPA-HQ-OAR-2018-0195.

The Clean Air Act (CAA) requires the EPA to set NSPS for industrial categories that cause, or significantly contribute to, air pollution that may endanger public health or welfare. Wood smoke is made up of a mixture of gases and fine particles that are produced when wood and other organic matter burns. The fine particles in smoke  -  also called fine particle pollution or PM2.5 (because these particles have a diameter <= 2.5 micrometers)  -  can get deep into the lungs, harming the lungs, blood vessels and heart. People with heart, vascular or lung disease, older adults and children are the most at risk. The original NSPS for new residential wood heaters was published on February 26, 1988. On March 16, 2015 (80 FR 13672), the EPA updated the NSPS for new residential wood heaters under 40 CFR part 60, subpart AAA, and added performance standards for new residential hydronic heaters and new forced-air furnaces under 40 CFR part 60, subpart QQQQ.

For this comment summary in response to the proposed two year sell-through amendment to the NSPS (83 FR 61574), the terms heaters and stoves refer to appliances covered in 40 CFR part 60, subpart AAA, and the terms hydronic heaters and forced-air furnaces refer to appliances covered in 40 CFR part 60, subpart QQQQ. Also, for this proposed action, the terms wood heating device(s) and pellet heating device(s) refer to all units regulated by the 2015 NSPS (40 CFR part 60, subparts AAA and QQQQ).

The EPA held a public hearing on this proposed action on December 17, 2018 and summaries of the public testimonies presented at that hearing are included in this RTC document. The public comment period originally ended on January 14, 2019 for this proposed amendment but was re-opened on February 7, 2019 for an additional 5 days until February 12, 2019, so that the comment period would be open for a full 30 days after the public hearing. The EPA received 175 comment letters (with and without attachments) in response to the proposed amendment. These public submissions represent commenters from wood heating device manufacturers, retailers, trade groups, state/local/tribal regulatory agencies, multi-jurisdictional organizations, environmental and health advocacy organizations, citizen groups and private (individual) citizens. Appendix A, "Complete List of Commenters" lists all public submissions placed into the docket for this proposed rulemaking.

Throughout this document, we refer to a particular commenter (and/or a particular comment document) by reference to an ID number that corresponds to the last 4 digits of the associated Document Control Number (DCN) in the docket for this rulemaking: EPA-HQ-OAR-2018-0195. The public submissions are typically in email or letter form, from individuals representing either their own personal views or those of a group. We counted each of the public submissions as one commenter, whether the comment was that of an individual or on behalf of a group (such as a state air agency, trade organization, corporation, environmental/health organization or community coalition). Several form letter campaigns were conducted (e.g., by retailers of hydronic heaters manufactured by Central Boilers and by retailers of wood heaters and inserts), but the individual commenters who signed onto these campaigns were processed separately by the Federal Docket Management System (FDMS) and so are counted as separate comments in our tally.

For descriptive purposes, we categorized commenters according to the breakdown shown in Table 1 (on the next page). This table also tallies general support and opposition to the proposed sell-through and pellet fuel requirements.

In light of the overlap among the comments, this document does not respond to each comment individually. Although numerous comment excerpts are included in this RTC document, the EPA also summarizes similar comments and provides a single response to each significant argument, assertion, and question contained within the totality of comments. Within each comment summary section, the EPA provides in parentheses one or more DCN to identify the commenters who raised particular issues. Additionally, where a comment letter endorses or supports another commenter, we include their commenter DCN along with the DCN of the commenter that they support or endorse. We have made an effort to capture every issue raised, even if every commenter attribution is not listed in connection to that issue.

Table 1. Breakdown of Comments
                               Stakeholder Group
                              Number of Comments
Wood Heating Device Manufacturers and Industry Trade Group
                                                                             20
Wood Heating Device Retailers and Distributors
                                                                             73
Pellet Fuel Suppliers, Industry Trade Group, and Pallet Suppliers
                                                                              7
Federal Organizations
                                                                              1
State/Local/Tribal Governments, including Multi-Jurisdictional Organizations
                                                                             20
Environmental/Health Organizations (EHO) and Citizen Advocacy Groups
                                                                              9
Academia
                                                                              1
Private Citizens*
                                                                            44*
                                                                 Total Comments
                                                                            175
                 Support and Opposition to Proposed Actions**

Support for Sell-Through (any or all wood heating devices)
                                                                            120
Opposition to Sell-Through (any or all wood heating devices)
                                                                             31
Support for Current or Revised Pellet Fuel Requirements
                                                                              8
Opposition to Pellet Fuel Requirements (support for elimination)
                                                                              6
Other (comment period extension and/or additional public hearing requests)
                                                                              6
Miscellaneous and Not Applicable
                                                                             12
  *Not included in the tally of 44 private citizen submissions is a mass mail submission containing 186 duplicate submissions.
  **Some commenters are represented more than once in the support/opposition tallies (e.g., the commenters who stated opinions about both the sell-through and pellet fuel requirements are tallied in both respective rows).

In the remaining sections of this RTC document we have summarized the public comments received on the proposed NSPS sell-through amendment, and we provide responses to those comments. A list of frequently used acronyms and abbreviations is provided in Table 1. Section 2 contains comments regarding the legality of the sell-through amendment under the CAA and other statutes. Section 3 contains comments supporting the sell-through for each type of wood heating device. Section 4 contains comments opposing the sell-through for each type of device. Section 5 contains comments regarding Step 1 and Step 2 statistics for each device, including comments regarding a decrease in sales as May 2020 approaches. Section 6 contains comments supporting the retention and/or revision of the pellet fuel requirements. Section 7 contains comments supporting eliminating the pellet fuel requirements from the NSPS and merely referencing external standards. And finally, Section 8 contains other and miscellaneous comments, including comments suggesting other types of relief in lieu of the sell-through.

Appendix A contains a complete list of commenters, including their Document ID#, the date the comment was received by FDMS, and the name and affiliation of the commenter.

Table 2. Explanation of Acronyms and Abbreviations

Acronym
Long Name
ug/m3
Micrograms per cubic meter
AAA
Subpart AAA of the 2015 RWH NSPS, and the wood heaters regulated under that Subpart (wood stoves/heaters, pellet stoves/heaters, single burn rate stoves/heaters)
ANPR
Advance Notice of Proposed Rulemaking
APA
Administrative Procedure Act
ASTM
American Society for Testing and Materials (now ASTM International)
BSER
Best System of Emission Reduction
BTU
British Thermal Unit
CAA
Clean Air Act
CARB
California Air Resources Board
CBI
Confidential Business Information
CFR
Code of Federal Regulations
CI ICE
compression ignition internal combustion engines
CO
Carbon Monoxide
CSA
Canadian Standards Association
DCN
Document Control Number
EPA
U.S. Environmental Protection Agency
EJ
Environmental Justice
EO or E.O.
Executive Order
FAF
Forced-air furnace(s)
FR
Federal Register
g/hr
Grams per hour
HH
Hydronic heater(s)
HPBA
Hearth, Patio and Barbecue Association
ICR
Information Collection Request
ISA
Integrated Science Assessment
kW or KW
Kilowatt
lb/mmBtu
Pounds per million British thermal unit
NAAQS
National Ambient Air Quality Standards
NESCAUM
Northeast States for Coordinated Air Use Management
NPRM
Notice of Proposed Rulemaking
NSPS
New Source Performance Standards
NOx
Nitrogen oxides
NYSERDA
New York State Energy Research and Development Authority
OAQPS
Office of Air Quality Planning & Standards (USEPA)
OAR
Office of Air and Radiation (USEPA)
OMB
Office of Management and Budget
PAH
Polycyclic aromatic hydrocarbon
PFI
Pellet Fuels Institute
PM
Particulate Matter
PM2.5
Particulate Matter with diameter <= 2.5 micrometers ("fine particles")
PM ISA
Integrated Science Assessment for Particulate Matter
QQQQ
Subpart QQQQ of the 2015 RWH NSPS, and the wood heaters regulated under that Subpart (hydronic heaters, forced-air furnaces)
R&D
Research and development
RIA
Regulatory Impact Analysis
RWH
Residential Wood Heater(s)
SBREFA
Small Business Regulatory Enforcement Fairness Act
SRIA
Supplemental Regulatory Impact Analysis
VOC
Volatile organic compound
WESTAR
Western State Air Resources Council

2.0 	Legality of the Sell-Through Amendment under the Clean Air Act and other Statutes
Section 2 presents comment excerpts and summaries regarding the legal arguments both for and against the sell-through amendment, based on the Clean Air Act (CAA) and other statutes. This section also includes comments concerning the sell-through as a component of the best systems of emissions reduction (BSER) for wood heating devices, as well as comments critical of EPA's rationale for the sell-through as presented in the Agency's supplemental Regulatory Impact Analysis (RIA).

2.1	The Sell-Through Amendment is Permissible under the CAA
Section 2.1 presents comment excerpts and summaries that argue from a legal basis and contend that the sell-through amendment is permissible under the CAA and moreover required to cure a defect in the 2015 NSPS. Most comments included herein are from the industry trade group.

2.1.1 Comment: Nothing in the CAA limits EPA's authority to stagger compliance deadlines
Several commenters (0063, 0051) urged the EPA to expand the sell-through period to apply to all types of wood heating devices, under both subparts AAA and QQQQ, noting that there is nothing in the CAA that limits EPA's authority to stagger compliance deadlines for the manufacture and sale of regulated appliances. One commenter (0063 p.2) noted that when EPA initially promulgated standards of performance for wood stoves in 1988, it included a two-year sell-through period for conventional, previously unregulated stoves, which the Agency estimated emitted about 60 to 70 grams per hour (g/hr) of PM. The commenters (0063, 0051) noted moreover that the Agency has extended compliance dates for prior NSPS rules for not only residential wood heating appliances, but also other source categories.

Response:
The EPA has considered these comments in support of the proposed sell-through periods and agrees that the agency has the authority to promulgate a sell-through period following the May 2020 Step 2 deadline. However, for the reasons explained in the final rule preamble and in this response to comment document, the EPA had decided not to promulgate any sell-through periods for the Step 2 standards.

2.1.2 Comment: EPA has authority under Section 111 to revise the existing NSPS and cure defect in 2015 NSPS by adding sell-through provisions
One commenter (0063 pp.4-8) asserted not only that the EPA has authority under Section 111 of the CAA to establish different compliance or applicability dates in the NSPS, as supported by Agency precedent, but also that adding the sell-through cures a defect in the 2015 NSPS:

      Contrary to what some stakeholders claimed during the public hearing on the current
proposal, EPA has authority under CAA Section 111 to establish different compliance deadlines for the manufacture and sale of residential wood burning appliances. Section 111(b) of the Act establishes various deadlines -- e.g., for publishing a list of regulated source categories, promulgating initial standards, reviewing (and revising, if appropriate) standards. Although that section states that standards "shall become effective upon
      promulgation," that language does not dictate when regulated sources must achieve compliance with such standards.
      Not surprisingly, EPA has long interpreted Section 111 as providing the Agency with the flexibility to establish compliance (or applicability) dates in NSPS rules that are different from the rules' effective dates. When EPA originally promulgated NSPS for residential wood heaters in 1988, it established two sets of compliance deadlines for the dates of manufacture and the dates by which regulated stoves must be sold: the first set of standards applied to stoves "manufactured on or after July 1, 1988, or sold at retail on or after July 1, 1990." The second set of standards applied to stoves "manufactured on or after July 1, 1990, or sold at retail on or after July 1, 1992." None of these dates lined up with that rule's February 26, 1988 effective date. Similarly in 2015, when EPA revised and expanded the NSPS for residential wood heaters, it once again established staggered compliance deadlines after the rule's May 15, 2015 effective date. Of particular relevance, although the Step 1 emissions limits became applicable to appliances manufactured on or after the effective date, room heaters and hydronic heaters that did not meet those Step 1 limits could continue to be sold at retail through December 31, 2015, so long as they were manufactured before the rule's effective date. In addition to the foregoing staggered deadlines, EPA delayed application of the deadlines for the Step 2 standards until May 15, 2020, a full five years after the effective date of the rule.
      The practice of staggering effective dates and compliance deadlines in NSPS rules is not unique to the residential wood heating industry. In the 2006 NSPS for stationary compression ignition internal combustion engines ("CI ICE"), EPA staggered the deadlines for the manufacture and installation of affected engines in a way that is virtually indistinguishable from the sell-through language that EPA has proposed in this rule. The CI ICE rule phased in increasingly stringent emission standards over several years such that the "engine model year in which the Tiers [took] effect varie[d] for different size ranges of engines." Owners and operators of engines were given a full two years after a new, more stringent standard took effect to continue installing previously manufactured engines that did not yet meet the new standard. Thus, for example, owners and operators had until December 31, 2008 to install engines that did not meet the applicable requirements for 2007 model year engines. To use another example, owners and operators had until December 31, 2014 to continue installing non-emergency stationary CI ICE with a maximum engine power of >19 KW (25 HP) and <56 KW (75 HP) that did not meet the applicable requirements for 2013 model year non-emergency engines.
      Notably, when EPA originally proposed the CI ICE standards, it gave owners and
operators only six months to install engines of a previous tier. When EPA finalized that rule, it extended the installation period to two years after receiving critical comments from stakeholders. To support that change, EPA explained that:
            EPA agrees with the commenters that the 6-month deadline for
installing engines of a previous tier is not long enough to allow for
the time that typically elapses between order and installation of an
engine and may prevent engine manufacturers from using up
existing inventories of engines. Therefore, EPA increased the time
limit to 24 months after the beginning of the model year.
      EPA recognized the need to account for market realities and to give engine manufacturers a sufficient amount of time to recoup their investments at each tier, rather than forcing companies to absorb losses from unsellable inventory. To hedge against the possibility that manufacturers would try to take advantage of this two-year lag time, EPA included "antistockpiling provisions similar to those used for nonroad engines to prohibit stockpiling of previous tier engines in the final rule." Under the anti-stockpiling provisions, manufacturers were permitted to "introduce into commerce uncertified engines or engines certified to earlier standards that were manufactured before the new or changed standards took effect until inventories are depleted, as long as such engines are part of normal inventory." The "normal inventory" standard was not an inflexible, one-size-fits-all number. The regulatory text explained, by way of illustration, that "if the engine manufacturers' normal industry practice is to keep on hand a one-month supply of engines based on its projected sales, and a new tier of standards starts to apply for the 2009 model year, the engine manufacturer may manufacture engines based on the normal inventory requirements late in the 2008 model year, and sell those engines for installation."
      While the 2006 CI ICE rule is perhaps the closest analog to EPA's current proposal, EPA has promulgated numerous NSPS rules for other source categories that contain delayed compliance deadlines. For instance, in the 2012 NSPS for the oil and natural gas sector, EPA gave "owners or operators . . . a 1-year phase-in beginning October 15, 2012 before the 95.0- percent control requirement" became applicable to storage vessel affected sources. To justify that later deadline, EPA explained that it "believe[d] this [was] necessary because of initial problems securing control devices that are manufacturer-tested and have appropriate documentation for determining control efficiency." In the 2005 NSPS for coal-fired electric utility steam generating units, EPA established a two-step compliance framework for regulated entities to achieve the emissions cap limits for mercury: "In the final rule, EPA has determined that the technologies necessary to achieve the emission cap limits for 2010 have been adequately demonstrated, and that the technologies necessary to achieve the 2018 caps have been adequately demonstrated to be available to achieve compliance with those limits by 2018." Finally, in the 2008 NSPS for stationary spark ignition internal combustion engines, EPA delayed several of the compliance deadlines well beyond the rule's effective date.
      One final point on EPA's statutory authority warrants a brief discussion. Nothing in the recent D.C. Circuit Air Alliance Houston decision restricts EPA's ability to revise the 2015 wood heater NSPS rule to provide for a two-year sell through period once the Step 2 standards become applicable. Unlike the delay rule at issue in that case, this proposal is not governed by CAA Section 307(d)(7)(B). Equally important, in Air Alliance Houston, the Court found that EPA had failed to explain why it was reaching different conclusions than it had in the underlying risk management plan rule and that EPA had instead delayed the effective date based on speculation about future amendments. That is not the case with EPA's current proposal. EPA has articulated an explanation (discussed below) as to why some of the assumptions in the 2015 wood heaters NSPS have proven to be incorrect.
      In fact, the proposed sell-through provisions would actually remedy a defect in the 2015 rule, i.e., the unexplained and arbitrary inconsistency between the lack of sell-through provisions in the Step 2 standards and the inclusion of such provisions in both the 1988 standards and the Step 1 standards. That EPA added language between the proposed and final 2015 rules to allow "sell-through" of hydronic heaters at Step 1 underscores that EPA continued to believe, on the date of the 2015 rule's promulgation, that allowing sell-through was important to avoid harm to regulated entities. It was especially arbitrary for EPA to simultaneously prohibit, without explanation, the sell-through of Step 1-compliant inventory for a period of time after May 15, 2020 in the very same final rule. As the D.C. Circuit has explained, "dissimilar treatment of evidently identical cases, on the same day, seems the quintessence of arbitrariness and caprice."
      For all of these reasons, not only does EPA have the authority to revise the 2015 Rule to include sell-through provisions in 2020, such a revision is necessary to cure a legal deficiency in that rule.

Response:
The EPA has considered these comments in support of the proposed sell-through periods and agrees that the agency has the authority to promulgate a sell-through period following the May 2020 Step 2 deadline. However, for the reasons explained in the final rule preamble and in this response to comment document, the EPA had decided not to promulgate any sell-through periods for the Step 2 standards.

EPA's decision in 2015 to promulgate sell-through provisions for the Step 1 standards and not for the Step 2 standards is a comment on the final action that EPA took in 2015, and thus, is outside the scope of this rulemaking. EPA's supporting documentation for the 2015 NSPS provided relevant information regarding why a Step 2 sell-through after 2020 was not deemed necessary. Prior to the NSPS proposal in 2014 and as stated in the RIA (https://www.regulations.gov/document?D=EPA-HQ-OAR-2009-0734-1789, p. 5-10) and background Manufacturer Cost Impacts Memorandum (https://www.regulations.gov/document?D=EPA-HQ-OAR-2009-0734-1761, p. 10), manufacturers stated that model development takes anywhere from 8 to 18 months. Using the conservative number of 1.5 years (18 months) to bring Step 2 devices to market (while selling Step 1 devices), this leaves an additional 3.5 years (of the 5 years between Step 1 in 2015 and Step 2 in 2020) for developing additional fireboxes in the model line while selling a mix of increasing Step 2 and decreasing Step 1 heaters. Further, as EPA stated in the 2015 RTC (https://www.regulations.gov/document?D=EPA-HQ-OAR-2009-0734-1775, pp. 40-1, 277, 278), "all manufacturers were on notice as of November 2009 that this NSPS was being developed and that new emission standards would be required." In other words, manufacturers have been on notice for much longer than the 5 years between 2015 and 2020, regarding the need for development of cleaner models and related management of inventory. Furthermore, numerous commenters, in response to the 2014 NSPS proposal, argued that 5 years between Step 1 and Step 2 was much too long and asserted that a shorter phase-in was feasible and appropriate. For example, many argued for 2 to 3 years between Step 1 and Step 2 (https://www.regulations.gov/document?D=EPA-HQ-OAR-2009-0734-1775, pp. 97-8, 266-7, 301). Given all these considerations, EPA determined that 5 years between Steps 1 and 2 was sufficient. This period of time was conservative/long enough to allow Step 2 devices to enter the market ahead of the 2020 deadline and clear out Step 1 inventory, as in fact many manufacturers have been able to achieve.

2.2 	The Sell-Through Amendment is not Permissible under the CAA and other Statutes
Section 2.2 presents comment excerpts and summaries that argue from a legal basis and contend that the sell-through amendment is not permissible under the CAA, other statutes and Agency mandate and guidance. Most comments included herein are from state and local regulatory agencies, multi-jurisdictional organizations, state attorneys general, academia, and environmental, health and citizen organizations.

2.2.1 Comment: The proposal is arbitrary and capricious in violation of the Administrative Procedure Act
One commenter (0057 pp.11-16) asserted that EPA's proposal is arbitrary and capricious in violation of the Administrative Procedure Act and CAA requirements:

      An agency action is arbitrary and capricious, in violation of the Administrative Procedure Act, "if the agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise." Federal agency decision-making must be "reasoned"; "[n]ot only must an agency's decreed result be within the scope of its lawful authority, but the process by which it reaches that result must be logical and rational."

      As noted [elsewhere in comment 0057], U.S. EPA fails to provide any reasoned basis for its proposed amendment. The agency also fails to explain or justify its selection of a two-year sell-through period rather than a longer or shorter period.

      Changes in agency policy positions are permissible only when the agency provides reasoned justification for the change. This includes a reasoned explanation for its rejection of any previous factual findings: "In such cases it is not that further justification is demanded by the mere fact of policy change; but that a reasoned explanation is needed for disregarding facts and circumstances that underlay or were engendered by the prior policy."

      U.S. EPA's proposed amendment fails on multiple fronts. U.S. EPA demonstrates no factual or other reasoned basis for rejecting or revising the conclusions set forth in the rulemaking record for the NSPS. U.S. EPA entirely fails to consider important aspects of the issues, offers justifications that run counter to the evidence before the agency, and insufficiently explains the reasons for its change and rejection of earlier determinations.

      a. Ostensible "new issues" were considered in the 2015 rulemaking.

      U.S. EPA claims, as the basis for its proposed sell-through:

            Recently, the EPA has learned from manufacturers and retailers that a substantial number of retailers are already reducing or even ending their purchases of Step 1-certified wood heating devices from the manufacturers because they are concerned that they will not be able to sell these devices before the May 2020 Step 2 compliance date and will be left with unsaleable inventory. Additionally, some manufacturers have indicated that they will need until May 2020 to develop, test, and certify wood heating devices to meet the 2020 Step 2 standards. As a result, manufacturers may face revenue losses as retailers are not willing to buy the Step 1-certified models and the Step 2-certified models have not yet been developed, tested, and certified.

      While agencies are entitled to change policy positions, such changes must be supported by reasoned explanation. "[T]he requirement that an agency provide reasoned explanation for its action would ordinarily demand that it display awareness that it is changing position."

      U.S. EPA presents the manufacturers' recycled complaints as new concerns that the agency had not previously considered and incorporated into its BSER and policy determinations. However, U.S. EPA considered and addressed these ostensibly new issues in its 2015 rulemaking. Citing the costs of research and development, and retail of the Step 2 heaters and particular burdens on small businesses, myriad manufacturers and trade associations submitted comments on the proposed NSPS requesting grandfathering, sell-through periods, a longer Step 1 period, or other flexibilities before full implementation of the Step 2 requirements. In particular, the Hearth, Patio & Barbecue Association (HPBA) commissioned and submitted a survey of distributors and retailers that it submitted along with its detailed comment letter. As relayed in the HPBA's comment letter, "[T]he majority of retailers felt that they needed 12 to 24 months to sell moderate and slow selling inventory." Moreover, HPBA asserted:

            [R]etailers' reluctance to buy models that are not given an unlimited sell-through period will have profound financial impacts on appliance manufacturers because many retailers will stop buying appliances they are not absolutely sure that they can sell, and the manufacturers will lose the revenue from the sales of these heaters; revenue that is needed to fund the design, testing and the launch costs for new NSPS compliant models.

      U.S. EPA fully considered these requests, providing some of the requested flexibilities (for example, the unusually long Step 1 period, "designed specifically with small businesses in mind"), and incorporating detailed responses to any denied requests into the NSPS rulemaking record. The agency incorporated several flexibilities into the final NSPS because "if production and sales were to be suspended while designing, testing, field evaluating and certifying cleaner models, the cost of potential lost revenues could be significant, which necessitates reasonable lead times for compliance with emission limitations." U.S. EPA also engaged in an extensive Small Business Advocacy Review process in advance of proposing the NSPS. Despite all of the consideration of business concerns, U.S. EPA wrote, "We have [] determined that the second step represents stronger emission levels achievable for all appliance types at reasonable cost, allowing appropriate lead times for manufacturers to redesign their model lines to accommodate the improved technology across multiple model lines and test, field evaluate, and certify new model lines." U.S. EPA does not now present any reasoned basis, new considerations, or new data that might justify altering this determination, and may not finalize amendments without so doing. U.S. EPA has also failed to contend with new evidence of feasibility suggests that BSER is even better-demonstrated than at the time the NSPS was promulgated.

      b. The proposal's costs would vastly outweigh its benefits.

      As discussed above, Clean Air Act section 111(b) requires U.S. EPA to demonstrate that any standard or revision it promulgates under the section, such as the proposed NSPS amendments, "reflects the degree of emission limitation achievable through the application of the best system of emission reduction," "consider[ing] the emission limitations and percent reductions achieved in practice." Given this, U.S. EPA may not justify its proposed revisions on the basis of cost savings or cost-effectiveness alone, as it attempts to do. Even if doing so were legally permissible, however, U.S. EPA fails to demonstrate that the proposed amendments would provide overall benefits or improve the cost-effectiveness of the NSPS. In fact, even U.S. EPA's own Supplemental Regulatory Impact Analysis (RIA)  -  which is outcome-seeking and flawed, as described [elsewhere in comment 0057]  -  demonstrates likely costs of the proposed amendment that dwarf its anticipated benefits. U.S. EPA estimates that the proposed amendment would generate average monetized particulate-related health impacts ranging from $94 million to $350 million per year, which would extend through the stoves' lifetime of 20 or more years. U.S. EPA estimates that the proposed sell-through would generate average benefits (industry cost savings) of $8.3 to $10.6 million per year, which would begin the year before the Step 2 compliance deadline (2019) and extend through the two years of the proposed sell-through period (2020-2022). Comparing potential costs of $94 million to $350 million per year over 20 years (anticipated costs) versus potential benefits of $8.3 to $10.6 million per year over three years (anticipated benefits) produces an estimated cost-benefit ratio of between 59-to-1 and 123-to-1. It is difficult to conceive how a regulatory amendment with total estimated costs that are 59 to 123 times greater than its total estimated benefits could comprise "reasoned decision-making" that would satisfy the APA.

      Where, as here, rulemaking is predicated on cost savings, failure to quantify quantifiable costs of the rulemaking, as described [elsewhere in comment 0057], also amounts to "fail[ure] to consider an important aspect of the problem" in contravention of the APA.

      Relatedly, U.S. EPA fails to acknowledge that it is proposing to remove protections from the books in this context: It analyzes the proposed amendment as a less-protective regulatory option than the NSPS, citing "foregone benefits," rather than acknowledging that it is considering abrogating a rule now in force.

Likewise, another commenter (0053 p.5) maintained that the proposal runs afoul of the APA, when they stated:

      In order to avoid arbitrary and capricious rulemaking under the Administrative Procedure Act ("APA"), an agency must "examine the relevant data" and "articulate a satisfactory explanation for its action including a rational connection between the facts found and the choice made." When delaying the implementation of a preexisting rule, agencies must "cogently explain" the reasoning behind the suspension. The suspension of a rule represents a reversal, for which the agency must provide a "reasoned explanation" for dismissing the "facts and circumstances that underlay" the original rule. In issuing the Proposed Rule, EPA failed to meet these basic requirements. The agency makes no attempt to explain what circumstances have changed since the 2015 NSPS was finalized that now necessitate a revision of the 2020 compliance date. Nor does it make any effort to demonstrate the extent of the alleged problem of stranded heater inventory.

Other commenters (0066 pp.10-11, 0137) similarly asserted that  -
      The Proposed Rule is Arbitrary and Capricious
      Aside from being unlawful under the Clean Air Act, the proposed rule is also arbitrary and capricious. "A reviewing court shall hold unlawful and set aside agency action, findings, and conclusions found to be . . . arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law[.]" 5 U.S.C. § 706; accord 42 U.S.C. § 7607(d)(9)(A). "[A] rule is arbitrary and capricious if the agency: (1) has relied on factors which Congress has not intended it to consider, (2) entirely failed to consider an important aspect of the problem, (3) offered an explanation for its decision that runs counter to the evidence before the agency, or (4) offers an explanation that is so implausible that it could not be ascribed to a difference in view or the product of agency expertise." Am. Wild Horse Pres. Campaign v. Perdue, 873 F.3d 914, 923 (D.C. Cir. 2017) (internal alterations omitted); see also State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (same).
      Furthermore, "an agency changing its course by rescinding a rule is obligated to supply a reasoned analysis for the change[.]" State Farm, 463 U.S. at 42. The requirement that "[a]n agency [must] provide reasoned explanation for its action would ordinarily demand that it display awareness that it is changing position." F.C.C. v. Fox Television Stations, Inc., 556 U.S. 502, 515 (2009). It "must show that there are good reasons for the new policy." Id. Where, as here, a new policy rests on factual or legal determinations that contradict those underlying the agency's prior policy, the agency must provide a more detailed explanation for its policy. Id. "Unexplained inconsistency" in agency policy is "a reason for holding an interpretation to be an arbitrary and capricious change from agency practice." National Cable & Telecommunications Ass'n v. Brand X Internet Servs., 545 U.S. 967, 981 (2005).

Response:
The EPA has considered these comments in opposition to the proposed sell-through periods following the May 2020 Step 2 deadline, which are largely based on legal arguments and contend that the sell-through amendment is not permissible under the CAA, other statutes and Agency mandate and guidance. For the reasons explained in the final rule preamble and in this response to comment document, the EPA has decided not to promulgate any sell-through periods for the Step 2 standards, and therefore is not providing detailed written responses to these specific comments here.

2.2.2 Comment: The proposal fails to meet the procedural requirements of the CAA
One commenter (0057 pp.7-11) asserted that the proposal fails to meet the procedural requirements of CAA section 307(d):
      Clean Air Act section 307(d) lays out procedural requirements for most rulemaking under the Act, including New Source Performance Standards. It requires that an NPRM be "accompanied by a statement of its basis and purpose." This must include:
            [A] summary of (A) the factual data on which the proposed rule is based; (B) the methodology used in obtaining the data and in analyzing the data; and (C) the major legal interpretations and policy considerations underlying the proposed rule . . . . All data, information, and documents referred to in this paragraph on which the proposed rule relies shall be included in the docket on the date of publication of the proposed rule.
      The proposed sell-through amendment violates these procedural requirements, as U.S. EPA has failed to provide data substantiating its proposal and failed to supply major legal interpretations and policy considerations underlying the proposed amendment.
      a. U.S. EPA fails to provide factual data or otherwise justify the proposed amendment.
      U.S. EPA bases its proposed sell-through exclusively on unsubstantiated assertions from a handful of industry sources claiming that they will lose business if no sell-through is provided. U.S. EPA does not appear to have inquired about or considered whether these manufacturers made a good-faith effort to produce Step 2-compliant heaters on a timeframe that would allow for retail sale by the Step 2 deadline or otherwise avoid the economic harms they claim to anticipate. The agency provides no evidence to demonstrate that stranded assets exist in reality, the quantity of those assets, the monetary losses that are estimated to be incurred by businesses, or potential adverse outcomes of this revenue loss (job loss, bankruptcy, etc.). Instead, the agency simply applies unsupported assumptions to the data underlying promulgation of the NSPS (as detailed further [elsewhere in comment 0057].)
      Nor does U.S. EPA provide any explanation or reasoned basis for its proposal of a two-year sell-through, as opposed to a longer or shorter period, let alone any supporting data.
      b. Requests for comment on additional topics may attempt to evade procedural requirements.
      U.S. EPA has requested comment on certain potential amendments without proposing them, including an unspecified potential sell-through period for new residential wood heaters after the May 2020 compliance date and unspecified potential amendments to the minimum pellet fuel requirements in the NSPS. U.S. EPA's choice to include these requests for comment in the NPRM is noteworthy, given U.S. EPA's concurrent publication of an Advance Notice of Proposed Rulemaking (ANPRM) to solicit input on a variety of potential NSPS amendments. This approach suggests that U.S. EPA may intend to finalize amendments based on these comment solicitations in the NPRM, which would circumvent the Clean Air Act section 307(d) requirements for proposed rulemakings. This is particularly concerning given that U.S. EPA acknowledges, in response to pressure from the White House Office of Management and Budget (OMB) to propose these amendments, having no technical or legal basis for doing so:
            EPA is not proposing a sell-through for wood/pellet stoves because 18% of 110 non-catalytic wood stoves and 89% of 9 catalytic and hybrid wood stoves already met the Step 2 emissions limits in November 2014, and, as noted above, as of March 2018, a total of 78 models meet the limits. (In comparison, there are many fewer hydronic heaters and forced-air furnaces which meet the Step 2 emission limits.) Thus, there is no compelling technical (or legal) basis, and the [OMB] commenter has not provided any such basis, for proposing a sell-through for wood stoves.
      After noting that U.S. EPA cannot justifiably propose these amendments, however, the agency concludes that it could still finalize them based on public comments: "EPA is, however, taking comment on the issue and could, if sufficient information is provided during the public comment period, provide a sell-through for wood stoves in its final action." Finalizing a sell-through for residential wood heaters or amendments to the NSPS pellet fuel requirements, without issuing a supplemental proposal that meets the requirements of Clean Air Act section 307(d), would comprise an end-run of those requirements. CARB [the California Air Resources Board] would be denied the opportunity to comment on the specifics of any potential sell-through, as none are provided in this NPRM.
      U.S. EPA also misinterprets the burden of amending a regulation, both under Clean Air Act section 307(d) and under the Administrative Procedure Act (APA) (as detailed [elsewhere in comment 0057]). Regarding the potential unspecified pellet fuel amendments, the agency requests both "comments that both support the current requirements (and explain why they are necessary) and comments that advocate that the requirements be removed or revised." However, no supportive comments are needed to preserve the legal status quo; the Clean Air Act and the APA give U.S. EPA the onus of proposing and justifying amendments to duly promulgated regulations.
      c. U.S. EPA fails to acknowledge the partial legal and policy basis for its proposal.
      In violation of the Clean Air Act section 307(d) requirement to provide "the major legal interpretations and policy considerations underlying the proposed rule," U.S. EPA provides no explanation of the legal authority for its proposed sell-through. The agency also fails to acknowledge the partial basis for its proposal and comment solicitations in industry challenges to the NSPS. Shortly after the NSPS was finalized, industry groups filed consolidated challenges to the certification test methods prescribed by the rule, among other issues. In an April 2018 declaration supporting a U.S. EPA motion to extend briefing deadlines, Peter Tsirigotis, Director of the U.S. EPA Office of Air Quality Planning and Standards, explained that U.S. EPA would promulgate the NPRM partly as a result of these challenges:
            Since the filing of this challenge to the 2015 Wood Heaters rule, and in particular over the past 12 months, EPA and Petitioners have engaged in discussions concerning the issues that Petitioners have raised with respect to the 2015 Wood Heaters rule that is the subject of this litigation. EPA has now determined that there are certain issues concerning the rule that warrant an opportunity for public comment, and which may lead to revisions to the rule. These issues include issues raised by Petitioners in this litigation and, as well, issues that EPA has itself identified since the rule was promulgated in 2015. As a consequence, EPA is at this time preparing a sequence of Federal Register notices with respect to the 2015 Wood Heaters rule[.]
      A fact sheet about the proposal and ANPRM on U.S. EPA's website (not incorporated into the rulemaking record), also identifies "major legal interpretations and policy considerations underlying the proposed rule" that were not included in the NPRM or its docket, in apparent violation of Clean Air Act section 307(d). The fact sheet explains, under the heading "Basis for Actions," that U.S. EPA has initiated review and potential revision of certain certification test methods and procedures required by the NSPS. "Because this is a technically complex undertaking that is expected to take several years to complete," the fact sheet continues, "the agency will in the meantime be taking steps to provide relief to wood heater manufacturers and retailers so that they are not forced to make inefficient  -  and possibly, ineffective  -  use of their resources in the interim." This explanation, the apparent actual basis for the proposed action, appears nowhere in the NPRM or rulemaking docket. (It also appears to be at least somewhat disingenuous, since U.S. EPA first published a discussion paper and solicited comment on certification test methods nearly three years ago, which itself is not mentioned in either the NPRM or ANPRM or placed within or linked to either docket.)
      d. The public comment deadline violates Clean Air Act section 307(d)(5).
      Clean Air Act section 307(d)(5) requires the Administrator to "give interested persons an opportunity for the oral presentation of data, views, or arguments, in addition to an opportunity to make written submissions;" and to "keep the record of such proceeding open for thirty days after completion of the proceeding to provide an opportunity for submission of rebuttal and supplementary information." In violation of this thirty-day requirement, U.S. EPA held a public hearing on the NPRM on December 17, 2018, but closed the comment period on January 14, 2018.
Commenter 0057 (excerpted above) provided an addendum comment during the comment period's extension (0130), contending that the EPA violated CAA section 307(d) by not referencing litigation from industry trade groups as a basis for the proposed sell-through:

      In our comments [0057], CARB noted that the NPRM fails to meet the Clean Air Act section 307(d) requirement to provide "the major legal interpretations and policy considerations underlying the proposed rule[.]" In part, this is because U.S. EPA failed to acknowledge the partial basis for its proposal in industry challenges to the standards, including Hearth, Patio & Barbecue Association v. EPA. CARB's comments included examples of U.S. EPA documents that cite this litigation as the motivation for some of the proposed amendments.

      On February 5, 2019, U.S. EPA filed a motion in Hearth, Patio & Barbecue Association v. EPA to hold the case in abeyance pending finalization of the NPRM. The motion relies on a U.S. EPA manager's accompanying declaration, which states that the NPRM was specifically published "to propose and take comment on amendments to the 2015 Wood Heaters rule related to certain issues raised by the Petitioners in this litigation."

      This statement further demonstrates that the industry challenge to the performance standards constitutes a significant consideration underlying the proposed amendments. U.S. EPA's failure to reference the litigation in explaining the basis of its proposal violates the requirements of Clean Air Act section 307(d).

Other commenters (0066 p.10, 0137) similarly asserted that  -
      EPA Failed to Explain the Legal Basis for the Proposed Sell-Through Period, as Required Under Section 307(d) of the Act
      EPA's failure to explain its legal rationale or cite any legal authority in support of its proposed sell-through provision also violates section 307(d) of the Act, which sets forth the requirements for agency rulemakings. Section 307(d)(3)(C) states that EPA shall include in the preamble of a proposed rule "the major legal interpretations . . . underlying the proposed rule." 42 U.S.C. § 7607(d)(3)(C); see also 1 C.F.R. § 18.12(a) (federal agencies must include "basis and purpose" for a proposed rule). Yet, the preamble of this proposal contains no explanation of EPA's legal authority to allow a sell-through period. This constitutes a violation of section 307(d). At a minimum, therefore, EPA must supplement its proposed rule with an explanation of its legal authority and extend the public comment period to allow for an opportunity for public input on the agency's rationale.

Likewise, another commenter (0054/0200 pp.10-11) questioned the basis of the proposal as well as the length of the comment period  -
      EPA's proposal fails to clearly articulate a legal, environmental or economic basis to move forward with the rule changes. These are well understood and basic elements that federal regulatory agencies must include to ensure informed public comment.
      Finally, we note that due to the government shutdown and EPA's earlier refusal to extend the comment period for this proposal, EPA has not fully provided answers to our questions seeking greater clarification of its proposed changes and its Supplemental RIA approach. For these and all the reasons covered in our comments, NESCAUM urges EPA to abandon this proposal.

      Response:
The EPA has considered these comments in opposition to the proposed sell-through periods following the May 2020 Step 2 deadline, which are largely based on the argument that EPA failed to follow certain procedural and legal requirements. The EPA does not agree with these specific arguments regarding failing to follow such procedural and legal requirements. Nevertheless, for the reasons explained in the final rule preamble and in this response to comment document, the EPA has decided not to promulgate any sell-through periods for the Step 2 standards and therefore is not providing detailed written responses to these specific comments here.

2.2.3 Comment: The proposal imposes public health and environmental harm on society contrary to CAA's statutory mandate and Agency guidance
Many commenters (0045, 0053, 0054/0200, 0059, 0064, 0066, 0068, 0073, 0074, 0075, 0137, 0142) contended that the adverse public health impacts and environmental harm to society caused by the sell-through  -  even by the Agency's own underestimation of adverse impacts  -  is contrary to the CAA's statutory mandate and Agency guidance.

For example, one commenter (0053 pp.3-5) asserted that finalizing the sell-through proposal "would be arbitrary and capricious as it would, even by EPA's own flawed economic analysis, impose net costs on society in a way that ignores the Agency's statutory mandate as well as longstanding agency guidance."  -
      The analysis performed by the agency in the Supplemental RIA significantly underestimates the costs of the Proposed Rule; these deficits are discussed in detail [elsewhere in comment 0053]. Yet even under EPA's faulty analysis, it is clear that the Proposed Rule will generate societal costs that outweigh its benefits, which both violates the Clean Air Act's statutory mandate and Executive Order 12,866's agency guidance.
      The Step 2 emissions limits imposed by the 2015 NSPS are expected to greatly reduce human exposure to ambient fine particulate matter (PM2.5). PM2.5 exposure contributes to a number of detrimental health effects, including heart attacks, strokes, asthma exacerbation, and an array of other respiratory problems. Both short- and long-term exposure to PM2.5 increases the risk of premature death. EPA estimates that the Proposed Rule would increase PM2.5 emissions between 7,740 and 11,640 tons over the 20-year model life of wood heaters as compared to the compliance schedule established by the 2015 NSPS. EPA estimates that the costs to human health from these forgone emissions reductions would be between $250 million and $860 million in the first three years of the Proposed Rule's implementation alone. Taking the compliance costs into account, on net, the rule will impose in present value terms societal costs of between $70 million and $310 million on society in the form of increased morbidity and premature death due to human exposure to particulate emissions from wood heaters.
      But the statutory purpose of the NSPS emissions limits is to "promote the public health and welfare." A regulation that "does significantly more harm than good" cannot be consistent with this mandate. While EPA has some discretion in its implementation of the Clean Air Act's Section 111 mandate, that discretion must be exercised in a reasonable manner and be grounded in the agency's statutory authority. Yet EPA has pointed to nothing in the Clean Air Act that would support the view that the agency has discretion to impose public health and environmental harms on society, as the Proposed Rule would.
      Moreover, Executive Order 12,866 mandates that agencies select the regulatory approach "that maximize[s] net benefits (including potential economic, environmental, public health and safety [impacts])" unless a specific approach is statutorily prescribed. Further, each agency is directed to "tailor its regulations to impose the least burden on society." The agency clearly violates this guidance here. Even when the cost savings to industry from delayed compliance are subtracted from the value of forgone health benefits, the Proposed Rule remains net costly to society  -  on the order of tens to hundreds of millions of dollars in just three years. Executive Order 12,866 further advises that when agencies calculate the costs and benefits of a contemplated action they should also consider "the alternative of not regulating." EPA could spare the imposition of massive health costs on the American people by declining to finalize this Proposed Rule. The agency has provided no rational explanation for declining the no-regulation alternative.

Likewise, other commenters (0066 pp.7,11, 0137) noted that  -

      EPA's cost/benefit analysis in support of the proposed two-year sell-through provision evidenced a change in agency policy, prioritizing industry cost savings over public health benefits. For example, EPA proposed the two-year sell-through provision despite finding that the cost savings for industry (termed "benefits" under the agency's revised approach) would amount to about $10 million annually, compared to the "costs" (foregone public health benefits) of $90 million to $230 million. ...
      EPA made several errors in its analysis supporting the proposed rule and failed to provide a good reason for the change in its rule providing for a five-year phase in period for compliance with step two standards (without a two-year sell through). In promulgating the 2015 NSPS, EPA recognized the dangers of PM2.5 emissions. EPA estimated that the 2015 standards would reduce premature deaths by 360 to 810 people, prevent 180 emergency room visits, and avoid 48,000 lost workdays. Those dangers are still present, and EPA does not even try to argue that the proposed rule will have any health benefits. EPA's lack of justification for the delay in implementation and disregard of the serious public health concerns the statute aims to protect is arbitrary and capricious. See Air All. Houston v. Envtl. Prot. Agency, 906 F.3d 1049, 1066-67 (D.C. Cir. 2018) (finding EPA decision to change the effective date of a rule was arbitrary and capricious); Clean Air Council v. Pruitt, 862 F.3d 1, 8 (D.C. Cir. 2017) (finding EPA's decision to stay a rule was arbitrary and capricious).
      Instead, in the proposed rule, EPA admits that the costs in foregone health benefits ($90 million to $230 million) of modifying the rule outweigh the benefits in savings to manufacturers ($10 million) by a factor of between nine and twenty-three to one. 83 Fed. Reg. at 61,583. Although this ratio of benefits to public health compared to industry compliance costs is less than EPA found in promulgating the 2015 NSPS (nearly 100:1), EPA has not offered any reasoned explanation for why it is now prioritizing cost savings to industry that still pale in comparison to the public health benefits that will be lost.

Another commenter (0068 p.3) similarly asserted that  -

      The NPRM is in direct contradiction to the Clean Air Act's goal of improving air quality,
protecting the environment, and safeguarding human health. EPA's assessment of
environmental and health impacts is grossly inadequate and given little regard
compared to the cost savings to manufacturers of wood burning devices. The NPRM is
unnecessary since the 2015 NSPS rulemaking and supporting documentation address
all of the issues raised therein.

Another commenter (0059 p.2) noted that  -

      The result of this proposal will be that new but inefficient heating devices sold during the compliance extension are in operation for another 20 years, and people lose with bad air quality. The EPA's own truncated assessment of the benefits to industry and the cost of the health impacts from unmitigated wood smoke demonstrates this imbalance: the public health cost is almost four times more than the benefit to industry. If EPA had calculated the public health costs by accounting for the full 20 years that non-compliant stove would be operating, total public health costs would much greater.

Likewise, a commenter (0064 p.2) pointed out that  -

      The implementation of the proposed two-year sell-through for forced air furnaces and hydronic heaters is estimated to result in 257 tons of PM2.5, 271 tons of VOC and 1444 tons of CO being released compared to implementation of the 2015 NSPS as adopted. The annual average cost of these emissions for years 2019 to 2022 in terms of the forgone health benefits is estimated at a range of $70 to $210 million dollars (2016$). The annual average cost savings to industry for 2019-2022 is $8.3 million (2016$). So, the estimated short-term savings for a single industry are achieved at a societal cost that is at least an order of magnitude higher. Given that the estimates are only for a fraction of the lifetime of the furnaces and heaters, the actual costs are likely higher.

Similarly, another commenter (0073 pp.1-2) noted that  -

      We note with concern that EPA's own analysis that the proposed delay implementation of wood heater rule shows that delay would have a negative total economic impact on the U.S. economy. The 2015 final rule for wood stoves and heaters was estimated by EPA to produce an economic benefit of $100 dollars for each $1 of implementation costs. For the proposed rule under consideration, EPA has taken a number to steps to intentionally, and in our opinion, inappropriately, reduce the economic benefits yield from implementation of the 2015 rule. Even with biased analysis of the proposed rule under consideration, EPA analysis estimates the foregone environmental benefits caused by delayed implementation of the 2015 rule outweigh industry savings by 10 to 20 times. EPA's proposal to move forward with delayed implementation of the 2015 rule undermines the Administration's claims of supporting costs effective regulatory policy.

Another commenter (0054/0200 p.9) asserted that  -

      Finally, we note that according to the Office of Management and Budget's Office of Information and Regulatory Affairs (OIRA), "Cost-benefit analysis as required by EO 12866 remains the primary analytical tool to inform specific regulatory decisions. Accordingly, except where prohibited by law, agencies must continue to assess and consider both the benefits and costs of regulatory and deregulatory actions, and issue such actions only upon a reasoned determination that benefits justify costs." Given that the public health and environmental benefits are far greater than the cost to industry for complying with existing timeline in the NSPS, EPA cannot justify the proposed changes according to this directive.

Likewise, another commenter (0075 pp.5-6) contended that  -
      EPA's analysis of the benefits and burdens of the proposal is arbitrary and capricious and further undermines the basis for the proposed sell-through period.
      Though the proposed rule is unlawful in any event for the reasons given in section I [of DCN 0075], EPA's analysis of the benefits and burdens of the proposal further undermines the already unsound basis for the proposed action. That analysis is itself arbitrary and capricious in several respects. In calculating the harm the proposed sell-through period will inflict, EPA ignores that the impacted wood burning devices will emit additional air pollution for decades, not just during the period in which EPA proposes to permit their sale. EPA also underestimates the extent to which allowing a sell-through period will increase the shipments of Step 1 compliant units relative to Step 2 compliant units. Yet even with these defects, EPA's analysis of the costs and benefits of the proposed sell through period shows that the proposed action imposes costs that are far greater than the benefits EPA attributes to the delay. No matter how much EPA tilts the playing field, the proposed sell through period makes no sense. ...

      Despite these glaring errors that skew the agency's analysis in support of the proposed action, the cost reductions EPA claims the proposed sell-through period will provide to manufacturers are far less than the economic value of the harms delaying the Step 2 standards will impose. EPA concludes that the total present value of the cost savings resulting from the proposal is $25 to $29 million, while the present value of the foregone  -  and arbitrarily truncated  -  particulate matter reduction benefits ranges from $250 to $860 million. Supp. RIA at 8, 12. In sum, EPA's proposed sell-through period is not only unlawful, it is manifestly unreasonable.

A commenter testified at the public hearing (0142 p.32) that  -
      Regarding human health, EPA's analysis supporting the 2015 standards estimated that these standards would reduce premature deaths from wood-burning air pollution by between 360 to 810 people, prevent 180 emergency room visits, and avoid 48,000 lost workdays. In its proposed sell-through, EPA admits that the costs of changing the rule outweigh the savings by a ratio of approximately ten to one.
One commenter (0045 p.3) compared the public health benefits of the 2015 NSPS to the benefits to industry of the NPRM, as cited by the EPA  -

      EPA estimated that the annual PM2.5 public health benefits of the 2015 NSPS range from $3.4 to $7.6 billion and the estimated costs totaled $45.7 million, a net benefit between $74 and $165 for every dollar spent.[cites 2015 NSPS] This is in contrast to the $8.3 million benefit to manufacturers and retailers and increased public health cost (or foregone benefits) of $94 to $210 million resulting from the proposal. [cites NPRM]

Another commenter (0074 p.6) concluded that  -

      The Regulatory Impact Analysis (RIA) estimates health costs of the proposed action to be 10 to 40 times greater per year for the life of a stove (20-30 years) than the one-time benefit to manufacturers. That health burden accrues to states and counties in excess deaths and illness and we find the disparity in impact to "benefit" to be unconscionable.

      Response:
The EPA has considered these comments in opposition to the proposed sell-through periods following the May 2020 Step 2 deadline. For the reasons explained in the final rule preamble, and in this response to comment document, the EPA has decided not to promulgate any sell-through periods for the Step 2 standards and therefore is not providing detailed written responses to these specific comments here.

2.2.4 Comment: EPA does not have authority to extend a sell-through period under the CAA or under consumer protection laws
Multiple commenters (0054/0200, 0065, 0066, 0068, 0137, 0142) contended that not only is the sell-through not permissible under the CAA, but its implementation would result in consumer fraud, because the owners and operators who install non-compliant wood heating devices after May 15, 2020 would be in violation of the NSPS.

For example, commenters (0066 pp.8-12, 0137) asserted that EPA lacks the legal authority under the CAA Sections 111(b) and 111(e) to allow a sell-through period, despite the sell-through allowed in the 2015 NSPS  -
      The States oppose the proposed sell-through provision because it would violate the Clean Air Act and lead to increased particulate matter pollution that harms our residents. The proposed rule, if finalized, would violate the Act on substantive and procedural grounds. EPA lacks authority under section 111(b) of the Act to allow a sell-through period, and section 111(e) of the Act would prohibit installation and operation of step one wood-burning devices after May 15, 2020. ... Furthermore, the sale of wood-burning devices that consumers cannot lawfully operate may constitute consumer fraud under state law.
      EPA Lacks Authority under the Clean Air Act to Allow a Sell-Through Period
      Nothing in section 111(b) of the Clean Air Act, or any other provision of the Act, allows EPA to issue a NSPS and then permit manufacturers and retailers to continue to sell non-compliant devices after a standard takes effect. See Michigan v. E.P.A., 268 F.3d 1075, 1081 (D.C. Cir. 2001) ("[A]n administrative agency's power to promulgate legislative regulations is limited to the authority delegated by Congress."). Tellingly, and as discussed further below, EPA cites no legal basis in the preamble of the proposal for authorizing the sell-through of noncompliant units.
      The lack of explicit authority for EPA to grant a sell-through period contrasts with other statutes. For example, in setting standards for formaldehyde emissions from composite wood products, Congress allowed a sell-through period of 180 days for existing inventory. 15 U.S.C. § 2697(d)(3)(A); see Sierra Club v. Pruitt, 293 F. Supp. 3d 1050, 1059 (N.D. Cal. 2018) (holding that EPA could not delay implementation past the 180-days for existing inventory authorized by the statute). The absence of such authority in section 111 should be given effect.
      The proposed sell-through provision is also inconsistent with the language in section 111(b). Specifically, section 111(b)(1)(B) states that "[s]tandards of performance or revisions thereof shall become effective upon promulgation." Id. § 7411(b)(1)(B) (emphasis added). Accordingly, the Act indicates that any NSPS takes effect on its promulgation and applies to all new sources. It does not authorize EPA to allow continued sale of non-compliant devices with an applicable performance standard. EPA's attempt to create a work around to allow new sources to avoid the May 2020 effective date is inconsistent with the statutory scheme.
      To the extent EPA relies on its previous, seven-month, sell-through provision contained in the 2015 rule for its legal authority, it is incorrect. That shorter sell-through provision was not challenged in court, and past agency practice cannot provide a valid legal basis for an agency action that is unauthorized by the governing statute. See Wilderness Soc. v. Morton, 479 F.2d 842, 865 (D.C. Cir. 1973) ("An administrative practice which is plainly contrary to the legislative will may be overturned no matter how well settled and how long standing.").
      The Clean Air Act Prohibits Installation and Operation of Non-Compliant Devices
      Even if EPA had the authority to allow a sell-through period, section 111(e) of the Act still prohibits owners from installing and operating new non-compliant wood-burning devices. "After the effective date of standards of performance promulgated under this section, it shall be unlawful for any owner or operator of any new source to operate such source in violation of any standard of performance applicable to such source." 42 U.S.C. § 7411(e). As explained below, the installation of a new wood boiler, furnace, or heater by an owner after May 15, 2020 would make it a new source that would have to comply with any "applicable" standard under section 111, including the step two standards.
      Under EPA's regulations implementing section 111, a wood-burning device sold and installed after May 15, 2020 would be a "new source" subject to the step two standards. A new source is "any stationary source, the construction or modification of which is commenced after the publication of regulations (or, if earlier, proposed regulations) prescribing a standard of performance under this section which will be applicable to such source." Id. § 7411(a)(2). The devices would become new sources at the time of installation by the owner because construction includes installation. See 40 C.F.R. § 60.2 ("Construction means fabrication, erection, or installation of an affected facility.").
      Although manufacturers would have built the wood boiler or furnace before May 2020, the owner or operator who purchased the device after May 2020 would neither have "undertaken a continuous program of construction" nor entered into a contract for construction of the device. See 40 C.F.R. § 60.2. The actions of the owner, not the manufacturer, control whether the wood boiler or furnace is a new source. See 42 U.S.C. § 7411(a)(2) (defining new source); 40 C.F.R. § 60.2 (defining commenced to include actions by the owner). Section 111(e) prohibits operation of a new source by an owner or operator, which is "any person who owns, leases, operates, controls, or supervises a stationary source." Id. § 7411(a)(5). Here, that definition would therefore apply to a consumer who purchases and installs a wood-burning device, making it unlawful for the owner to operate a noncompliant device purchased after May 15, 2020.
      Governing case law under section 111 supports the conclusion that step one-compliant devices sold after May 2020 would be considered new sources, not existing sources. For step one devices bought after May 2020, the owner would not have been involved with constructing the boiler before the NSPS took effect. See United States v. Painesville, 644 F.2d 1186, 1187, 1188 n.2 (6th Cir. 1981) (holding that a coal boiler was a new source because it was built after a NSPS went into effect). Similarly, it is unlikely that the owner would have contracted to buy the wood-burning device before it arrives in a retail show room. See Sierra Pacific Power Co. v. E.P.A., 647 F.2d 60, 66 (9th Cir. 1981) (finding a boiler was a new source because there was no contract for construction before the NSPS). Except in the odd circumstance where the owner entered into a purchase contract before May 2020, but bought and installed the step one-compliant devices after May 2020, there would be no contract for sale before the step two NSPS took effect. As in Painesville and Sierra Pacific Power, the step one devices would therefore qualify as new sources.
      Furthermore, in the proposed rule, EPA admits that the 2015 NSPS (including the step two standards) apply to not only manufacturers and retailers but also owners and operators. See 83 Fed. Reg. at 61,574, 61,578. EPA cannot now deny that owners and operators would be subject to the step two NSPS, and therefore could not lawfully install and operate step one-compliant devices after May 2020.
      As a newly-installed wood boiler or forced-air furnace would be a new source, the NSPS would be "applicable" to it. Thus, the Act prohibits operation of any wood-burning device bought and installed after May 15, 2020 that does not comply with the step two standards. See 42 U.S.C. § 7411(e); Painesville, 644 F.2d at 1187, 1188 n.2, 1190 (allowing enforcement under section 111(e) for a new source). ...
      Finally, in addition to the numerous problems with the proposal under federal law outlined above, EPA's proposed sell-through provision would also create potential consumer fraud issues under state law. As explained above, if EPA allowed sale of new noncompliant wood boilers and forced-air furnaces past May 15, 2020, it would still be illegal under section 111(e) for owners to install and operate them. Failure by retailers to disclose this issue to consumers may constitute consumer fraud under state laws. See, e.g., N.Y. General Business Law § 349; see also People ex rel. Spitzer v. Applied Card Sys., Inc., 894 N.E.2d 1, 6 (N.Y. 2008) (holding that federal law did not preempt the state Attorney General's ability to seek penalties and restitution for consumer frauds). EPA could avoid these consumer fraud issues by not finalizing the proposed sell-through provision.
Another commenter (0054/0200 p.3 and public hearing testimony 0142 p.23) similarly asserted that EPA does not have the legal authority under Section 111 of the CAA to extend a sell-through period, and that doing so would also raise consumer protection issues  -

      NESCAUM opposes any sell-through period during which retailers can continue to sell newly manufactured or existing inventory of Step 1 compliant hydronic heaters and forced-air furnaces after May 2020 when the Step 2 standards come into effect. CAA §111(b)(1)(B) requires that the performance standards be effective upon promulgation of the NSPS or revisions thereof. Consequently, EPA lacks the legal authority to extend the period by which units that do not meet the Step 2 requirements can be sold after May 2020. Further, CAA §111(e) makes it unlawful to operate a new source in violation of a performance standard. Consequently, the sell-through provision could also raise legal issues under state consumer protection laws. Selling Step 1 heating devices that owners could not lawfully operate for their intended purpose may constitute consumer fraud.

Likewise, another commenter (0065 p.5) noted that the "CAA Section 111 is clear in stating that NSPS must take effect upon their promulgation; EPA has not identified a mechanism that would allow for a sell-through that sanctions violations of the NSPS." A commenter (0142 pp.30-33) similarly testified at the public hearing:

      [T]he proposed sell-through provision is unlawful under the Clean Air Act because Congress did not authorize EPA to adopt a sell-through period after the effective date of a New Source Performance Standard. ... Lastly, the proposed sell-through provision would enable retailers to sell wood-heating devices that the buyers could not legally operate, raising consumer fraud concerns. ... Regarding the unlawfulness of the sell-through provision, EPA lacks the statutory authority to adopt such a provision. The Clean Air Act authorizes EPA to adopt New Source Performance Standards and to establish the effective date of those standards, but does not authorize a sell-through provision for devices that no longer comply with an applicable standard. Under the Clean Air Act, operation of the new non-compliant stoves after May 2020 would be illegal, regardless of whether EPA allowed a sell-through period. Under section 111 of the Clean Air Act, it is unlawful to operate a new source in violation of a performance standard. Case law also confirms that operating a new source that does not comply with the performance standards violates section 111(e). Accordingly, the sell-through provision would raise legal issues under state consumer protection laws. Selling Step 1 heating devices that owners could not lawfully operate for their intended purpose may constitute consumer fraud. These legal problems are easily avoided by abandoning the sell-through proposal.

Another commenter (0068 p.5) similarly argued that a sell-through could subject consumers to enforcement action, because the consumer, as an operator, would be in violation of the U.S. Code governing new stationary sources  -

      The proposed two-year sell-through provision, if adopted, could subject
homeowners to violations of 42 U.S. Code §7411, "standards of performance for
new stationary sources":
      "(e) Prohibited Acts. After the effective date of standards of performance
promulgated under this section, it shall be unlawful for any owner or operator
of any new source to operate such source in violation of any standard of
performance applicable to such source."(emphasis added)

Finally, contrary to assertions made in Section 2.1.2, a commenter (0057 p.5) notes that "It is not evident that a sell-through would be permissible under Clean Air Act section 111(b) ... Federal agencies may only act in accordance with authority granted them by Congress. Congress has included explicit authority for regulatory sell-through provisions in other environmental statutes, and declined to include such a provision in Clean Air Act section 111(b).

      Response:
The EPA has considered these comments in opposition to the proposed sell-through periods following the May 2020 Step 2 deadline. For the reasons explained in the final rule preamble, and in this response to comment document, the EPA has decided not to promulgate any sell-through periods for the Step 2 standards and therefore is not providing detailed written responses to these specific comments here.

2.2.5 Comment: The proposal would increase emissions in non-attainment areas in violation of the CAA
Several commenters (0052, 0057, 0065, 0074, 0129) contended that the increase in emissions caused by the sell-through in NAAQS non-attainment areas, and in areas close to non-attainment, would violate the CAA and unravel state implementation plans (SIPs).

For example, one commenter (0057 pp.5-7) asserted that the proposal would violate section 176(c) of the CAA by increasing emissions in non-attainment areas  -
      The Clean Air Act requires U.S. EPA to identify and establish National Ambient Air Quality Standards (NAAQS) for criteria air pollutants, including primary standards for protecting public health. These health-based air quality standards are used to determine whether a geographic area is in attainment with the national standards, and thereby determine the obligations of the state to reach or maintain those standards.
      Clean Air Act section 176(c) prohibits federal actions or activities that would "cause or contribute to any new violation of any standard in any area; increase the frequency or severity of any existing violation of any standard in any area; or delay timely attainment of any standard or any required interim emission reductions or other milestones in any area."
      There are currently six geographic areas, or air basins, in California, comprised of 27 counties containing about 78 percent of the State's population, that are designated either completely or partially as nonattainment for PM2.5. State Implementation Plans (SIPs), developed by the State in concert with air quality agencies in the affected regions, detail how the areas will attain or maintain the PM2.5 NAAQS. SIPs demonstrating attainment depend on emission reduction strategies that include, at a minimum, reasonably available controls on sources to reduce emissions as expeditiously as practicable. California has many of the nation's PM2.5 nonattainment areas, rendering the NSPS particularly important to public health and to air quality planning processes in the state. Particulate emissions from residential wood burning result in increased public health impacts, particularly in rural and low-income communities, and contribute toward the PM2.5 nonattainment status in many areas of California.
      Postponing the availability of Step 2-compliant heaters in areas with SIPs that rely on the use of such lower-emitting heaters to achieve attainment with the PM2.5 NAAQS would effectively prevent those areas from attaining the standards as expeditiously as practicable and, consequently, is detrimental to public health. The use of wood heaters that meet Step 2 limits under the 2015 NSPS is critical for those PM2.5 nonattainment areas, particularly in rural parts of the State where wood heaters are the primary source of space heating. Analysis of emission sources and their relative contribution to ambient air pollution (i.e., source apportionment analysis) estimates that in certain rural nonattainment areas of the State, wood smoke contributes 76 percent of annual average PM2.5 concentrations and is the primary cause of nonattainment.
      Delaying the more stringent Step 2 standards through the addition of a sell-through period of any duration, or any other amendment that delays or dilutes the NSPS, would impede California's planning efforts toward meeting the NAAQS in these rural areas, as well as other areas of the State. The proposed sell-through is therefore prohibited under Clean Air Act section 176(c).

Likewise, an association of state air agencies (0065 p.5) argued that  -
      The Step 2 NSPS set to take effect in 2020 will put in place consistent health-protective residential wood heater emission standards nationwide and help to ensure the cleanest and most efficient wood heaters are available for purchase, providing significant long-term benefits to reduce fine particulate emissions regionally and locally. A few states have enacted legislation barring their jurisdictions from enforcing the March 2015 federal NSPS for residential wood-burning heating devices. However, emissions from residential wood combustion cause many counties across America to either exceed, or come precariously close to exceeding, the health-based National Ambient Air Quality Standards (NAAQS) for PM2.5.
      Many state and local air quality agencies are relying on the emission reductions that will result from the Step 2 NSPS to attain and maintain the NAAQS and/or meet other clean air goals, and have included these reductions in their State Implementation Plans. If EPA allows the continued sale of Step 1 HHs, FAFs and/or wood heaters after the Step 2 compliance date these states and localities will be left with a shortfall in emission reductions that could impede their attainment efforts and put nonattainment areas at risk of missing statutory deadlines and attainment areas at risk of violating the NAAQS. Furthermore, such an outcome would be directly counter to EPA's first Priority Goal for FY 2018-2019  -  "Improve air quality by implementing pollution control measures to reduce the number of nonattainment areas"  -  as stated in Working Together: FY 2018-2022 U.S. EPA Strategic Plan.
The Western Governors' Association (0197 p.1) similarly argued that  -

      States are depending on the current compliance deadlines for these appliances to meet the responsibilities of their State Implementation Plans, as required by the Clean Air Act. As articulated in WGA Policy Resolution 2018-05, Air Quality and Methane Emissions Regulation, Western Governors request that EPA maintain the current NSPS compliance deadlines for new residential wood heaters

A state regulator (0074 pp.3-6) noted that its state implementation plans (SIPs) were developed assuming the full implementation of the 2015 NSPS  -
      Delaying the implementation of 2015 RWH NSPS Step 2 standards is likely to have negative impacts on communities' ability to attain NAAQS PM2.5 levels.
      Oregon has over a 30-year history of addressing areas that have violated federal health standards due to woodsmoke and has successfully brought those areas back into compliance. Oregon had seven large particulate matter (PM10) nonattainment areas due to woodsmoke and a key strategy to return those areas to attainment was to promote the use of cleaner-burning woodstoves, including the creation of the very first woodstove testing program which EPA subsequently used as the model for the national program. The state and local partnership has been successful and these areas continue to maintain compliance with the PM10 standard. EPA recently updated the standard for PM2.5, due to recent health studies that showed that fine particulate is more dangerous than previously thought. Several Oregon communities are either violating or at risk of violating the new PM2.5 standard. Promoting and ensuring the use of the cleanest burning devices continues to be a key strategy for communities to attain and maintain the new standard.
      Oregon communities depend on the more stringent standards.
      State implementation plans and emissions inventories for these communities to attain and maintain NAAQS have been established and calculated assuming the full implementation of the 2015 NSPS. Relaxing the 2020 deadline will delay the achievement of anticipated benefits and could potentially put these communities at risk of violating the standard. ...

      Oregon DEQ is concerned that extending the sell-through period of woodstoves and reducing projected benefits of woodsmoke curtailment activities will leave these communities at risk of noncompliance, and impact the ability of these communities to attract facilities that will provide the economic growth so deeply needed in these communities. The average "life" of a wood stove is 20 to 30 years in a residential home. The dirtier stoves installed as a result of an extended sell-through would essentially lock in poor performance from these stoves for an entire generation.
      As smoke from catastrophic wildfires continues to increase, the need for PM2.5 reductions from anthropogenic sources increases to minimize public health impacts.
      Wildfires are an increasing source of PM2.5 in the United States, due to warmer temperatures, earlier spring snowmelt, and longer fire seasons. Several studies have suggested that this trend will continue throughout the current century and that smoke could become the dominant source of PM2.5 in the western United States during the fire season. PM2.5 monitor data from 2017 and 2018 support this trend for sites in Oregon. Wildfire models predict that PM2.5 levels from wildfires should double over the next two decades (2040-2050), but overall PM2.5 population exposures to decrease due to reductions in anthropogenic sources, such as residential wood heaters (DEQ emphasis).
      With increased PM2.5 and other pollutant burdens from wildfires throughout the Western United States and Canada, real cumulative annual exposure in these communities will far exceed the standards set by NAAQS. Several studies show PM2.5 to be significantly causally associated with premature deaths, estimated to be between 15,000 and 50,000 excess deaths caused by wildfire smoke by 2050. While the impact from wildfire smoke is minimized in regulatory considerations, a growing body of public and environmental health literature shows that the health effects of wildfire smoke inhalation may be longer and more severe than understood earlier, and emphasize the urgent need to reduce anthropogenic sources of PM2.5 and other criteria pollutants as quickly as possible.
One state environmental agency (0052 pp.1-2) commented  -

      According to the air quality database of the U.S. Environmental Protection Agency (EPA) Office of Air and Radiation (OAR), Fairbanks North Star Borough (FNSB), Alaska, is the most polluted area in the nation for the 2006 24-hour fine particulate matter (PM2.5) National Ambient Air Quality Standard (NAAQS) with woodstoves and wood heaters being the primary source of pollution - contributing between 48% and 63% to pollution levels. On December 14, 2009, EPA designated a portion of the FNSB as a nonattainment area for the 2006 24-hour PM2.5 NAAQS. The burning of wood for heat during the cold winter, coupled with temperature inversions, is the primary reason for the spikes in PM2.5 levels in the area. To address episodes of poor air quality, ADEC implements various control strategies including wood burning curtailment alerts along with education, compliance and enforcement activities to reduce emissions from the use of solid-fuel burning devices (SFBDs). Local programs such as woodstove change-outs and SFBD conversion funded through the FY-16 and FY-17 Targeted Air Shed Grants respectively are ongoing to either reduce the number of SFBDs in the borough or ensure they are the cleanest devices available.

      Other areas in Alaska also have significant numbers of wood heating devices that can lead to poor air quality conditions. Since the 1980s, the community of Juneau, Alaska has also been engaged in control of wood heating devices through episodic wood burning curtailments, which have been necessary to achieve and maintain compliance with particulate matter NAAQS. Given that wood heating is an important source of primary, supplemental and emergency heat throughout the state and a significant contributor to local air pollution, Alaska has a vested interest in EPA's efforts to amend the NSPS for these heating devices... Alaska set its own standards for PM2.5 nonattainment areas in 2014 due to the continued delay to the update of the NSPS.

A local air quality management division (0129 pp.1-2) also pointed out how the sell-through would make their district come close to exceeding the NAAQS and would likely necessitate more intrusive government actions like burn bans  -

      The postponement of the Step 2 standards combined with the unprecedented growth currently being experienced will most certainly cause Washoe County to come precariously close to exceeding the National Ambient Air Quality Standard (NASQS) for PM2.5. The emissions reductions expected from Step 2 have already been built into our State Implementation Plan. A delayed Step 2 will result in a shortfall of emission reductions which will need to be made up through alternative regulatory restrictions on industry and an increase in burn bans during wintertime inversions. While burn bans are an effective tool to reduce wintertime PM2.5 emissions, they are perceived by the community as one of the most intrusive government programs by prohibiting the operation of an appliance in a private residence. Step 2 standards will provide emissions reductions while avoiding additional burn bans and preserving the relationship between air agencies and their community members across the county.

      Response:
The EPA has considered these comments in opposition to the proposed sell-through periods following the May 2020 Step 2 deadline. For the reasons explained in the final rule preamble and in this response to comment document, the EPA has decided not to promulgate any sell-through periods for the Step 2 standards and therefore is not providing detailed written responses to these specific comments here.

2.3	The Sell-Through as a Component of the Best Systems of Emission Reduction (BSER) Determination
Section 2.3 includes comment excerpts and summaries that examine the sell-through from the perspective of BSER determination under the CAA. Section 2.3.1 includes comments that contend the CAA requirements for BSER have not been met by the Agency for the sell-through amendment, as posited by state and local regulatory agencies, state attorneys general and environmental, health and citizen organizations. On the contrary, Section 2.3.2 includes comments that contend the two-year sell-through is part of the already-established BSER because it allows manufacturers the full five-year research and development phase, as posited by the industry trade group, a manufacturer and the US Small Business Administration.

2.3.1 Comment: The CAA requires EPA to demonstrate that the proposed revision reflects BSER
Several commenters (0045, 0056, 0057, 0065, 0071, 0075, 0142) asserted that the sell-through is a component of BSER and, as such, the Agency is required by the CAA to demonstrate why the Agency's previous determination of BSER in the NSPS has changed. These commenters furthermore asserted that the Agency failed to demonstrate how the sell-through is part of the already-established BSER or how BSER changed to now require the sell-through.

For example, one commenter (0075 pp.2-4) argued that "EPA's proposal would unlawfully and arbitrarily weaken the standards of performance adopted in 2015" because EPA did not establish that the extended sell-through reflects BSER, as required by section 111 of the CAA  -
      The proposed sell-through period would violate the Clean Air Act because the agency has failed to demonstrate that as so revised the resulting standards of performance would reflect the "best system of emission reduction" ("BSER"). Section 111 of the Clean Air Act requires EPA to set standards that reflect the "best system of emission reduction which (taking into account the cost of achieving such reduction and any non-air quality health and environmental impact and energy requirements) the Administrator determines has been adequately demonstrated." 42 U.S.C. § 7411(a)(1), (b)(1). "An adequately demonstrated system is one which has been shown to be reasonably reliable, reasonably efficient, and which can reasonably be expected to serve the interests of pollution control without becoming exorbitantly costly in an economic or environmental way." Essex Chem. Corp. v. Ruckelshaus, 486 F.2d 427, 433 (D.C. Cir. 1973). Section 111(b) further provides that when EPA revises a previously-issued standard of performance, it must "follow[] the procedure required by this subsection for promulgation of such standards." 42 U.S.C. § 7411(b)(1)(B). Accordingly, when EPA proposes to revise standards of performance in a way that would increase emissions, it must have good reasons for concluding that the requirements in place do not reflect the BSER.
      In 2015, EPA adopted a two-step approach to compliance for wood burning devices. Although Step 1 established separate compliance deadlines for manufacturers and retailers for some products, the Step 2 standards applied a single compliance deadline to both manufacturers and retailers. Compare, e.g., 40 C.F.R. § 60.5474(a)(1) (requiring manufacturer compliance with Step 1 limits on May 15, 2015, but allowing retailers to sell hydronic heaters manufactured before that date until December 31, 2015), with id. § 60.5474(a)(2) (prohibiting manufacturers and retailers from producing or selling units that fail to comply with Step 2 limits beginning on May 15, 2020); see also 80 Fed. Reg. 13,672, 13,680 (Mar. 16, 2015) ("Step 1 p.m. emission limits will apply to each hydronic heater[] manufactured on or after May 15, 2015 or sold at retail after December 31, 2015. Step 2 p.m. emission limits will apply to each hydronic heater manufactured or sold at retail on or after May 15, 2020."). EPA made clear that these deadlines were themselves components of the agency's determination of the BSER: the agency was adopting "the appropriate emission limits and compliance deadlines that together are representative of BSER." 80 Fed. Reg. at 13,675. EPA further explained that the requirements adopted in 2015 were designed "to allow manufacturers lead time to develop, test, field evaluate and certify current technologies across their consumer product lines to meet Step 2 emission limits and in most cases to allow retailers to sell-through inventory." Id. at 13,676. In sum, the Step 2 standards adopted in 2015 reflected EPA's considered judgment that a May 2020 compliance deadline for all units sold at retail reflected the BSER.
      In proposing an extended sell-through period for Step 2, however, EPA does not discuss the BSER factors at all, much less explain why weakening the standards to allow a sell-through period for products that fail to comply with Step 2 requirements is the BSER and is better than the current standards of performance. In fact, the agency does not even assert that its proposed revisions reflect the BSER. Instead, EPA claims that it "is not proposing any changes to its BSER determination and is not proposing any changes to the 5-year compliance period for Step 2 or the associated May 2020 compliance date." 83 Fed. Reg. at 61,579. These assertions do not withstand scrutiny. As explained above, when it adopted the current standards of performance in 2015, EPA made clear that the May 2020 compliance date-imposed obligations on both manufacturers and retailers and that those obligations reflected the agency's assessment of the BSER. Changing the date by when retailers must sell only Step 2 compliant models is a change to the May 2020 compliance date, a change to the 5-year compliance period for Step 2 that EPA put in place in 2015, and a departure from the agency's prior BSER determination. Yet EPA nowhere explains either why its delayed compliance date reflects the BSER or why the current requirements no longer reflect the BSER
      Had EPA acknowledged the Clean Air Act's applicable limits on the agency's discretion, it is inconceivable that the agency's rationale for delaying compliance would pass muster. To weaken a standard of performance, EPA must explain why the current BSER is no longer the "best" system. 42 U.S.C. § 7411(a)(1), (b)(1). Further, EPA must provide "a reasoned explanation . . . for disregarding facts and circumstances that underlay or were engendered by the prior policy." FCC v. Fox Television Stations, Inc., 556 U.S. 502, 515 (2009). Ignoring these requirements, the proposed rule relates only that "a substantial number of retailers" are curtailing their purchases of wood burning devices that do not meet the Step 2 standards and that "some manufacturers have indicated" they will need the full 5-year phase-in period to bring certified Step 2 compliant models to market. 83 Fed. Reg. at 61,578-79. EPA points out that these manufacturers "may face revenue losses," id. at 61,579, but that speculative possibility does not undermine the soundness of EPA's 2015 BSER determination. EPA's standards must reflect the "maximum practicable degree" of control, Essex, 486 F.2d at 437,  constrained only be the agency's obligation to ensure that the performance standards reflective of the BSER are not "greater than the industry could bear and survive." Portland Cement Association v. Train, 513 F.2d 506, 508 (D.C. Cir. 1975); see also Lignite Energy Council v. EPA, 198 F.3d 930, 933 (D.C. Cir. 1999) ("EPA's choice [of the BSER] will be sustained unless the environmental or economic costs of using the technology are exorbitant."). Accordingly, the possibility that some manufacturers will lose revenue to comply with the Step 2 limits for wood burning devices does not justify a conclusion that the applicable compliance deadlines no longer reflect the best system of emission reduction under section 111.

This same commenter summarized the above in his testimony at the public hearing (0142 pp.66-68) as follows  -
      Section 111 of the Clean Air Act requires that EPA set standards of performance which reflect the best system of emission reduction which, taking into account the cost of achieving such reduction and any non-air quality health and environmental impact and energy requirements, the Administrator determines has been adequately demonstrated. The standards of performance the EPA adopted for residential wood heaters required compliance with the Phase II emission limits for all units sold at retail. To delay the standard as the date approaches, EPA must show that revising the NSPS to increase emissions into the air is necessary because the standards EPA previously adopted no longer apply to that system of emission reduction. The EPA has not claimed that the best system of emission reduction for the NSPS is not achievable. Instead, the proposed rule claims that the compliance deadline is somehow not a component of the standards of performance, which is wrong, but even if it were correct, EPA would need to explain why the delaying compliance is necessary. But the only evidence EPA presents as part of delaying the standards is that some of the retailers are reducing their purchases of Step 1 certified units this year and that some manufacturers are concerned about meeting the 2020 deadline. Now, even if those assertions are true, they do not justify delaying the Step 2 limits. Moreover, as EPA's own analysis shows, weakening the standard by allowing the sale of non-compliant wood heaters would impose substantial costs in the form of additional harmful emissions that far exceed any benefits from the proposed action. There is simply no permissible reason grounded in the Agency's statutory authority to allow the standards to delay.
Another commenter (0057 pp.3-5) argued similarly that  -

      U.S. EPA must demonstrate that any proposed amendments to the NSPS are consistent with Clean Air Act requirements. In particular, U.S. EPA must demonstrate that the standard or revision "reflects the degree of emission limitation achievable through the application of the best system of emission reduction" (BSER), as required by Clean Air Act section 111(b). U.S. EPA must also "consider the emission limitations and percent reductions achieved in practice," a mandate that is designed to be technology-forcing. U.S. EPA does not endeavor to explain how the proposed amended NSPS would meet either of these requirements  -  presumably because the proposed amendment does not. U.S. EPA bases its proposed amendment exclusively on the pursuit of cost savings for industry that are dwarfed by public health impacts, entirely ignoring its statutory mandate.
      U.S. EPA asserts that it "is not proposing any changes to its BSER determination" because, "[a]lthough this proposed action may result in the delay of the emission reductions from the 2015 NSPS by up to two years, this proposed action to establish a sell-through period does not change the standards upon implementation." This statement contains multiple errors. The proposal would not merely delay the Step 2 emission reductions by two years, but would allow for the operation of any additional non-compliant heaters manufactured and sold as a result of the sell-through throughout their lifetimes of 20 years or more. U.S. EPA's 2015 BSER determination applies both to manufacture and retail:
            The level of control prescribed by section 111 of the CAA [Clean Air Act] is BSER. In analyzing BSER, the EPA uses available information and considers the emissions reductions and incremental costs for different systems available at reasonable cost. The residential wood heaters source category is different from most NSPS source categories in that it is for mass-produced residential consumer products. Thus, important elements in determining BSER include the significant costs and environmental impacts of delaying production while models with those systems are designed, tested, field evaluated and certified. Section 111(b)(1)(B) of the CAA requires that the standards be effective upon the effective date of the NSPS . . . . the stepped (phased) approach for residential wood stoves/ heaters, hydronic heaters and forced-air furnaces that the EPA is promulgating considers these factors. That is, for this rulemaking, the EPA has determined the appropriate emission limits and compliance deadlines that together are representative of BSER.
      U.S. EPA considered both dates of manufacture and dates of sale in determining BSER in 2015, and a proposal to extend the compliance deadline for sales by two years, resulting in significant emissions increases and health impacts, comprises a re-determination of BSER. U.S. EPA's simple assertion to the contrary has no basis or effect. U.S. EPA does not attempt to demonstrate that the proposed sell-through qualifies as BSER, presumably because it cannot.
      Additionally, U.S. EPA does not, because it cannot, claim that the NSPS is not "adequately demonstrated." More Step 2-compliant models currently exist than in 2015, when U.S. EPA determined that the Step 2 standards were technology-forcing but adequately demonstrated. As the basis of its proposal, U.S. EPA simply references a handful of industry complaints about the burdens of research and development, as further discussed below. These communications cannot justify redetermination of BSER.
      It is not evident that a sell-through would be permissible under Clean Air Act section 111(b), even if it did constitute BSER in this instance (which it does not). Federal agencies may only act in accordance with authority granted them by Congress. Congress has included explicit authority for regulatory sell-through provisions in other environmental statutes, and declined to include such a provision in Clean Air Act section 111(b). Regardless, U.S. EPA clearly may not belatedly add a sell-through period without redetermining that an NSPS with a sell-through constitutes BSER, which U.S. EPA explicitly has declined to do. To the extent that U.S. EPA is to be taken at its word that is not changing its BSER determination, the agency has no authority to relax the NSPS.

This commenter (0057 p.25) concluded by asserting their full support for the 2015 NSPS and "cautions [the] U.S. EPA that its proposal to weaken this standard is illegal, inappropriate, and contrary to its legal obligations to protect public health and welfare."

Likewise, another commenter (0065 pp.4-5) noted that  -
      As EPA acknowledges in the NPRM, Section 111 of the Clean Air Act (CAA) requires the agency to establish standards of performance that reflect "'the degree of emission limitation achievable through the application of the best system of emission reduction which (taking into account the cost of achieving such reduction and any non-air quality health and environmental impact and energy requirement) the Administrator determines has been adequately demonstrated.' This definition makes clear that the standard of performance must be based on controls that constitute `the best system of emission reduction (BSER)' ... Section 111(b)(1)(B) of the CAA requires that the standards be effective upon promulgation of the NSPS. Given this statutory requirement, as discussed more fully in the Federal Register notice for the 2015 NSPS rulemaking (80 FR 13672), the EPA adopted the stepped (phased) approach for residential wood heaters, hydronic heaters and forced-air furnaces to provide sufficient implementation time for manufacturers and retailers to comply with Step 2 limits."
      First, the NSPS EPA established for HHs, FAFs and wood heaters require full compliance with Step 2 by all devices sold at retail beginning May 15, 2020. A sell-through would allow for compliance with a weaker standard of performance than EPA has concluded reflects BSER even though EPA has not asserted that the BSER upon which the Step 2 standards are based cannot be achieved; in fact, such an assertion cannot be made because it has been demonstrated that the Step 2 standards are achievable for all categories of devices.

Another commenter (0071 pp.5-6) also argued that the "EPA proposed changes fail the Clean Air Act requirements" because a "BSER review" is required  -
      Under Section 111 of the Clean Air Act, EPA must establish standards that reflect the "best system of emissions reduction" (BSER) that take into account "the cost of achieving such reduction and any non-air quality health and environmental impacts and energy requirements." EPA completed such an assessment in the 2015 standards, concluding that a two-step approach that allowed the existing units (Step 1) to be sold until 2020 as the industry developed the cleaner, more fuel-efficient units (Step 2), meets the requirements for BSER.
      However, in this proposal, EPA states that, despite allowing the dirtier devices to be manufactured and sold for two more years, the Agency "is not proposing any changes to its BSER determination and is not proposing any changes to the 5-year compliance period for Step 2 or that associated May 2020 compliance date." (83 FR 61579).
      EPA provides no analysis to justify its determination that allowing the manufacturers to sell dirtier devices for two more years past the Step 2 deadline continues to meet with BSER requirements. Instead, EPA justifies its two-year delay in concerns from retailers that they will not be able to sell the dirtier devices. This comes despite increasing availability of models that meet the Step 2 requirements.
      Not only does this argument ignore the impact that such continued sales will have on public health, it fundamentally undercuts EPA's argument that there should be no changes to the BSER. It fails to address the reality that adding two more years for manufacturers to produce and sell non-compliant devices will allow more pollution. It also ignores the likelihood that the retailers would argue that they suffer that same dilemma in 2022. EPA has provided the industry with five years to phase in compliant products (following 28 years of no changes to the standards), and many have. EPA's explanation that these changes do not change the BSER determination ignores the realties that this proposal creates.