[Federal Register Volume 79, Number 213 (Tuesday, November 4, 2014)]
[Proposed Rules]
[Pages 65481-65505]
[FR Doc No: 2014-26112]

Vol. 79

Tuesday,

No. 213

November 4, 2014

Part II

Environmental Protection Agency

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48 CFR Part 60

Carbon Pollution Emission Guidelines for Existing Stationary Sources:
EGUs in Indian Country and U.S. Territories; Multi-Jurisdictional
Partnerships; Proposed Rule

Federal Register / Vol. 79 , No. 213 / Tuesday, November 4, 2014 /
Proposed Rules

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 60

[EPA-HQ-OAR-2013-0602, FRL-9918-54-OAR]
RIN 2060-AR33

Carbon Pollution Emission Guidelines for Existing Stationary
Sources: EGUs in Indian Country and U.S. Territories; Multi-
Jurisdictional Partnerships

AGENCY: Environmental Protection Agency.

ACTION: Supplemental proposed rulemaking.

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SUMMARY: On June 18, 2014, the Environmental Protection Agency (EPA)
proposed emission guidelines for states to follow in developing plans
to address greenhouse gas (GHG) emissions from existing fossil fuel-
fired electric generating units (EGUs). In this supplemental action,
the EPA is proposing emission guidelines for U.S. territories and areas
of Indian country with existing fossil fuel-fired EGUs. Specifically,
the EPA is proposing rate-based goals for carbon dioxide
(CO2) emissions for U.S. territories and areas of Indian
country with existing fossil fuel-fired EGUs, as well as guidelines for
plans to achieve those goals. The EPA is also soliciting comment on
authorizing jurisdictions (including any states, territories and areas
of Indian country) without existing fossil fuel-fired EGUs subject to
the proposed emission guidelines to partner with jurisdictions
(including any states) that do have existing fossil-fuel fired EGUs
subject to the proposed emission guidelines in developing multi-
jurisdictional plans. The EPA is also soliciting comment on the
treatment of renewable energy, demand-side energy efficiency and other
new low- or non-emitting electricity generation across international
boundaries in a state plan. This supplemental proposed rule would
continue progress already underway to reduce CO2 emissions
from existing fossil fuel-fired power plants in the United States.

DATES:
    Comments on the supplemental proposed rule. Comments must be
received on or before December 19, 2014.
    Comments on the information collection request. Under the Paperwork
Reduction Act (PRA), since the Office of Management and Budget (OMB) is
required to make a decision concerning the information collection
request between 30 and 60 days after November 4, 2014, a comment to the
OMB is best assured of having its full effect if the OMB receives it by
December 4, 2014.
    Public Hearing. A public hearing will be held to accept oral
comment on the supplemental proposed rule on November 19, 2014, at the
Phoenix Convention Center and Venues, 100 N. 3rd St., Phoenix, Arizona.
The hearing will begin at 9:00 a.m. (Mountain Standard Time) and will
conclude at 8:00 p.m. (Mountain Standard Time). There will be a lunch
break from 12:00 p.m. to 1:00 p.m. and a dinner break from 5:00 p.m. to
6:00 p.m.

ADDRESSES: Comments. Submit your comments, identified by Docket ID No.
EPA-HQ-OAR-2013-0602, by one of the following methods:
     Federal eRulemaking portal: http://www.regulations.gov.
Follow the online instructions for submitting comments.
     Email<EMAIL_ADDRESS>Include docket ID No. EPA-
HQ-OAR-2013-0602 in the subject line of the message.
     Facsimile:<PHONE_NUMBER>. Include docket ID No. EPA-HQ-
OAR-2013-0602 on the cover page.
     Mail: Environmental Protection Agency, EPA Docket Center
(EPA/DC), Mail code 28221T, Attn: Docket ID No. EPA-HQ-OAR-2013-0602,
1200 Pennsylvania Ave. NW., Washington, DC 20460. In addition, please
mail a copy of your comments on the information collection provisions
to the Office of Information and Regulatory Affairs, OMB, Attn: Desk
Officer for the EPA, 725 17th St. NW., Washington, DC 20503.
     Hand/Courier Delivery: EPA Docket Center (EPA/DC), Room
3334, EPA WJC West Building, 1301 Constitution Ave. NW., Washington, DC
20004, Attn: Docket ID No. EPA-HQ-OAR-2013-0602. Such deliveries are
accepted only during the Docket Center's normal hours of operation
(8:30 a.m. to 4:30 p.m., Monday through Friday, excluding federal
holidays), and special arrangements should be made for deliveries of
boxed information.
    Instructions: All submissions must include the agency name and
Docket ID No. (EPA-HQ-OAR-2013-0602). The EPA's policy is to include
all comments received without change, including any personal
information provided, in the public docket, available online at http://www.regulations.gov, unless the comment includes information claimed to
be Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through http://www.regulations.gov or email. Send or deliver information identified as
CBI only to the following address: Mr. Roberto Morales, OAQPS Document
Control Officer (C404-02), Office of Air Quality Planning and
Standards, U.S. EPA, Research Triangle Park, North Carolina 27711,
Attention Docket ID No. EPA-HQ-OAR-2013-0602. Clearly mark the part or
all of the information that you claim to be CBI. For CBI information on
a disk or CD-ROM that you mail to the EPA, mark the outside of the disk
or CD-ROM as CBI and then identify electronically within the disk or
CD-ROM the specific information you claim as CBI. In addition to one
complete version of the comment that includes information claimed as
CBI, you must submit a copy of the comment that does not contain the
information claimed as CBI for inclusion in the public docket.
Information so marked will not be disclosed except in accordance with
procedures set forth in 40 CFR part 2.
    The EPA requests that you also submit a separate copy of your
comments to the contact person identified below (see FOR FURTHER
INFORMATION CONTACT). If the comment includes information you consider
to be CBI or otherwise protected, you should send a copy of the comment
that does not contain the information claimed as CBI or otherwise
protected.
    The www.regulations.gov Web site is an ``anonymous access'' system,
which means the EPA will not know your identity or contact information
unless you provide it in the body of your comment. If you send an email
comment directly to the EPA without going through http://www.regulations.gov, your email address will be automatically captured
and included as part of the comment that is placed in the public docket
and made available on the Internet. If you submit an electronic
comment, the EPA recommends that you include your name and other
contact information in the body of your comment and with any disk or
CD-ROM you submit. If the EPA cannot read your comment due to technical
difficulties and cannot contact you for clarification, the EPA may not
be able to consider your comment. Electronic files should avoid the use
of special characters, any form of encryption and be free of any
defects or viruses.
    Docket: All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some
information is not publicly available (e.g., CBI or other information
whose disclosure is restricted by statute). Certain other

material, such as copyrighted material, will be publicly available only
in hard copy. Publicly available docket materials are available either
electronically in http://www.regulations.gov or in hard copy at the EPA
Docket Center, EPA WJC West Building, Room 3334, 1301 Constitution Ave.
NW., Washington, DC. The Public Reading Room is open from 8:30 a.m. to
4:30 p.m., Monday through Friday, excluding federal holidays. The
telephone number for the Public Reading Room is<PHONE_NUMBER>, and the
telephone number for the Air Docket is<PHONE_NUMBER>. Visit the EPA
Docket Center homepage at http://www.epa.gov/epahome/dockets.htm for
additional information about the EPA's public docket.
    In addition to being available in the docket, an electronic copy of
this proposed rule will be available on the World Wide Web (WWW).
Following signature, a copy of this proposed rule will be posted at the
following address: http://www2.epa.gov/cleanpowerplan/.
    Public Hearing: To register for the hearing please use the online
registration form available at: http://www2.epa.gov/carbon-pollution-standards/clean-power-plan-proposed-rule. For questions regarding
registration, please contact Ms. Pamela Garrett at<PHONE_NUMBER>. The
last day to pre-register to speak at the hearing will be November 14,
2014. Additionally, requests to speak will be taken the day of the
hearing at the hearing registration desk, although preferences on
speaking times may not be able to be fulfilled. If you require the
service of a translator or special accommodations such as audio
description, we ask that you pre-register for the hearing by November
14, 2014, as we may not be able to arrange such accommodations without
advance notice. Please note that any updates made to any aspect of the
hearing will be posted online at: http://www2.epa.gov/carbon-pollution-standards/clean-power-plan-proposed-rule. While the EPA expects the
hearing to go forward as set forth above, we ask that you monitor our
Web site or contact Pamela Garrett at<PHONE_NUMBER> to determine if
there are any updates to the information on the hearing. The EPA does
not intend to publish a notice in the Federal Register announcing any
such updates. The hearing will provide interested parties the
opportunity to present data, views or arguments concerning the proposed
action. The EPA will make every effort to accommodate all speakers who
arrive and register. The EPA may ask clarifying questions during the
oral presentations, but will not respond to the presentations at that
time. Written statements and supporting information submitted during
the comment period will be considered with the same weight as oral
comments and supporting information presented at the public hearing.
Verbatim transcripts of the hearing and written statements will be
included in the docket for the rulemaking. The EPA plans for the
hearing to run on schedule; however, due to onsite schedule
fluctuations, actual speaking times may shift slightly.

FOR FURTHER INFORMATION CONTACT: Ms. Melanie King, Energy Strategies
Group, Sector Policies and Programs Division (D243-01), Environmental
Protection Agency, Research Triangle Park, North Carolina 27711;
telephone number:<PHONE_NUMBER>; facsimile number:<PHONE_NUMBER>;
email address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Acronyms. A number of acronyms and chemical
symbols are used in this preamble. While this may not be an exhaustive
list, to ease the reading of this preamble and for reference purposes,
the following terms and acronyms are defined as follows:

BART Best Available Retrofit Technology
BSER Best System of Emission Reduction
CAA Clean Air Act
CBI Confidential Business Information
CFR Code of Federal Regulations
CO2 Carbon Dioxide
EGU Electric Generating Unit
EIA Energy Information Administration
EPA Environmental Protection Agency
FR Federal Register
GHG Greenhouse Gas
HAP Hazardous Air Pollutant
HCl Hydrochloric Acid
Hg Mercury
ICR Information Collection Request
LNG Liquefied Natural Gas
MHA Mandan, Hidatsa and Arikara
MW Megawatt
MWh Megawatt-hour
NAAQS National Ambient Air Quality Standards
NAICS North American Industry Classification System
NGCC Natural Gas Combined Cycle
NOX Nitrogen Oxides
OMB Office of Management and Budget
PM Particulate Matter
PM2.5 Fine Particulate Matter
PRA Paperwork Reduction Act
PREPA Puerto Rico Electric Power Authority
RE Renewable Energy
RFA Regulatory Flexibility Act
RIA Regulatory Impact Analysis
SCC Social Cost of Carbon
SO2 Sulfur Dioxide
TAR Tribal Authority Rule
TAS Treatment in the same manner as a State
TSD Technical Support Document
UMRA Unfunded Mandates Reform Act of 1995

    Organization of This Document. The information presented in this
preamble is organized as follows:

I. General Information
    A. Executive Summary
    B. Organization and Approach for This Supplemental Proposal
II. Background
    A. Carbon Pollution Emission Guidelines Proposal
    B. Implications for U.S. Territories
    C. Implications for Areas of Indian Country
    D. Additional Outreach and Consultation
III. Goals for U.S. Territories and Areas of Indian Country
    A. Overview
    B. Proposed Goals and Computation Procedure
    C. Alternate Goals Offered for Comment and Other Approaches
Considered
    D. Additional Considerations for U.S. Territories and Indian
Country
IV. CAA Section 111(d) Plans
    A. U.S. Territories
    B. Areas of Indian Country With Affected EGUs
    C. Applicability of the Proposed Emission Guidelines to U.S.
Territories and Eligible Indian Tribes
    D. Areas Without Affected EGUs
V. Impacts of the Proposed Action
    A. What are the air impacts?
    B. What are the energy impacts?
    C. What are the compliance costs?
    D. What are the economic and employment impacts?
    E. What are the benefits of the proposed action?
VI. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review, and
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health Risks and Safety Risks
    H. Executive Order 13211, Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations
VII. Statutory Authority

I. General Information

A. Executive Summary

1. Purpose of the Regulatory Action
    Under the authority of Clean Air Act (CAA) section 111(d), the EPA
is proposing emission guidelines to

address GHG emissions from existing fossil fuel-fired EGUs located in
U.S. territories and areas of Indian country. The EPA is proposing
rate-based goals for CO2 \1\ emissions in U.S. territories
and areas of Indian country with existing fossil fuel-fired EGUs that
meet applicability requirements (``affected EGUs''),\2\ as well as
guidelines for plans to achieve those goals. This rule, as proposed,
would continue progress already underway to reduce CO2
emissions from existing fossil fuel-fired power plants in the United
States. This action is a supplemental proposal to the June 18, 2014,
proposed carbon pollution emission guidelines for states to follow in
developing plans to address GHG emissions from existing fossil fuel-
fired EGUs.\3\ This action is based on the same analytic framework as
the June 18, 2014, proposal for existing sources, with minor
adjustments to address data limitations and other circumstances unique
to Indian country and/or territories.\4\ This preamble presumes
familiarity with that June 18, 2014, proposal.\5\
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    \1\ In the June 18, 2014, proposal, the EPA noted that the
primary GHG emitted by fossil fuel-fired EGUs is CO2.
Therefore, both that proposal and this supplemental proposal focus
on reductions of CO2 emissions and impose control
requirements on only CO2 emissions.
    \2\ In this preamble, the terms ``existing fossil fuel-fired
EGUs,'' ``existing sources,'' ``existing fossil fuel-fired power
plants,'' ``affected fossil fuel-fired EGUs'' and the like generally
refer to affected EGUs.
    \3\ 79 FR 34830.
    \4\ As noted below, the EPA issued a second proposal on June 18,
2014, under CAA section 111, which proposed standards of performance
for CO2 emissions from modified or reconstructed fossil
fuel-fired EGUs. 79 FR 34960. Unless otherwise indicated, all
references in this preamble to the June 18, 2014, proposal refer to
the proposal for existing sources.
    \5\ The EPA has received numerous comments on the June 18, 2014,
proposal. This supplemental proposal is consistent with the analytic
framework used in the June 18, 2014, proposal and does not reflect
any type of response to the comments that the EPA has received to
date on that proposal.
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2. Summary of the Major Provisions of the Regulatory Action
    The proposal has two main elements: (1) Emission rate-based
CO2 goals specific to each U.S. territory and area of Indian
country that has affected EGUs; and (2) guidelines for the development,
submission and implementation of plans to achieve the goals. The EPA is
aware of three areas of Indian country with affected EGUs: Lands of the
Navajo Nation, lands of the Ute Tribe of the Uintah and Ouray
Reservation and lands of the Fort Mojave Tribe. The EPA's information
is that there are two U.S. territories that have affected EGUs: Puerto
Rico and Guam.
    To set the proposed area-specific CO2 goals, the EPA
generally applied the same approach to determining the ``Best System of
Emission Reduction'' as called for in CAA section 111(d) used in the
June 18, 2014, proposal for establishing CO2 goals for
states. This approach, which relies on four groups of emission
reduction measures that the EPA refers to as ``building blocks,''
includes improvements in efficiency at carbon-intensive power plants;
programs that enhance the dispatch priority of, and spur private
investments in, low emitting and renewable power sources; and programs
that help homes and businesses use electricity more efficiently. As
explained in the June 18, 2014, proposal for existing sources, these
building blocks are based on practical and affordable strategies that
are already being used to lower carbon pollution from the power sector.
In addition, in calculating each CO2 goal, the EPA took into
consideration each area's fuel mix, its electricity market and other
factors that are relevant to application of the four building blocks.
Thus, each goal reflects the unique conditions for each U.S. territory
or area of Indian country.
    For U.S. territories that contain affected EGUs, while this
proposal lays out jurisdiction-specific CO2 goals, it does
not prescribe how the territory should meet its goal. CAA section
111(d) creates a partnership between the EPA and the U.S. territories
(as well as states) under which the EPA sets these goals and the
territories take the lead on meeting them by creating plans that are
consistent with the EPA guidelines. Each territory will have the
flexibility to design a program to meet its goal in a manner that
reflects its particular circumstances and energy and environmental
policy objectives. Each territory can do so alone or can collaborate
with other jurisdictions, including states, on multi-jurisdictional \6\
plans that may provide additional opportunities for cost savings and
flexibility. To facilitate the planning process, this proposal lays out
guidelines for the development and implementation of plans.
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    \6\ The discussion of CAA section 111(d) plans in the June 18,
2014, proposal referred to ``multi-state'' plans. In this
supplemental proposal, the EPA uses the terminology ``multi-
jurisdictional'' plans to account for situations where plans may
include tribes in addition to states.
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    For areas of Indian country that contain affected EGUs, this
proposal also lays out specific CO2 goals, without
prescribing how each area should meet its goal. A tribe with
jurisdiction over the affected EGUs in its area has the opportunity,
but not the obligation, to establish a plan for its area of Indian
country. Each tribe can do so alone or can collaborate with other
jurisdictions, including states and territories, on multi-
jurisdictional plans that may provide additional opportunities for cost
savings and flexibility. If a tribe does not seek and obtain the
authority to establish a plan, the EPA is responsible for establishing
a plan if it determines that a plan is necessary or appropriate. At
this time, the EPA is not including a proposal for whether it is
necessary or appropriate to establish a plan for any area of Indian
country, and is not proposing a federal plan for any area of Indian
country.
3. Costs and Benefits
    Actions taken to comply with the proposed guidelines set out in
this supplemental proposal will reduce emissions of CO2 and
other air pollutants, including sulfur dioxide (SO2) and
nitrogen oxides (NOX), from the electric power industry,
specifically from affected EGUs in Guam and Puerto Rico. The costs and
benefits of these compliance actions are discussed below. As discussed
in more detail in section V of this supplemental proposal, the EPA does
not expect any additional costs or benefits associated with compliance
for areas of Indian country with affected EGUs; one area is expected to
meet its proposed goal through compliance with other regulations, and
the costs and benefits for the other areas were already accounted for
in the June 18, 2014, proposal. The U.S. territories of Guam and Puerto
Rico will make the ultimate determination as to how their proposed
emission guidelines are implemented in their jurisdictions. Thus, all
costs and benefits reported for this action are illustrative estimates.
The illustrative costs and benefits are based upon compliance
approaches that reflect a range of measures consisting of improved
operations at EGUs, increased dispatching of lower-emitting EGUs and
zero-emitting energy sources and increasing levels of end-use energy
efficiency.
    For Guam and Puerto Rico, the EPA estimates that in 2020, the
illustrative compliance approach for Option 1--Approach A \7\ will
yield monetized climate benefits of approximately $73 million (3
percent model average, 2011$), as shown in Table 1. The illustrative
annual compliance costs and monitoring and reporting costs are a

savings of approximately $140 million (2011$) in 2020. The quantified
2020 net benefits (the difference between monetized benefits and costs)
are $210 million (2011$) using a 3 percent discount rate. In 2030, as
shown in Table 1, the illustrative compliance approach for Option 1--
Approach A in Guam and Puerto Rico will yield monetized climate
benefits of approximately $170 million (3 percent model average,
2011$). The illustrative annual compliance costs and monitoring and
reporting costs in 2030 are a savings of $350 million, including
reduced fuel expenditures from energy efficiency programs and re-
dispatch. The quantified 2030 net benefits are $520 million (2011$, 3
percent discount rate).
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    \7\ Option 1 represents compliance with the goals calculated
using the procedure outlined in section III.B of this supplemental
proposal. As explained in more detail in section III.B, Approach A
mirrors the proposed methodology from the June 18, 2014, proposal
for building block 3.
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    For Option 2--Approach A,\8\ the EPA estimates that in 2020, the
illustrative compliance approach for EGUs in Guam and Puerto Rico will
yield monetized climate benefits of approximately $68 million (3
percent model average, 2011$), as shown in Table 2. The illustrative
annual compliance costs and monitoring and reporting costs are a
savings of approximately $130 million (2011$) in 2020. The quantified
2020 net benefits (the difference between monetized benefits and costs)
are $200 million (2011$) using a 3 percent discount rate. In 2025, as
shown in Table 2, the illustrative compliance approach for Option 2--
Approach A in Guam and Puerto Rico will yield monetized climate
benefits of approximately $99 million (3 percent model average, 2011$).
The illustrative annual compliance costs and monitoring and reporting
costs in 2025 are a savings of $190 million, including reduced fuel
expenditures from energy efficiency programs and re-dispatch. The
quantified 2025 net benefits are $290 million (2011$, 3 percent
discount rate).
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    \8\ Option 2 represents compliance with the goals calculated
using the procedure outlined in section III.C of this supplemental
proposal, reflecting less stringent application of the building
blocks and a shorter implementation period.
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    For Guam and Puerto Rico, the EPA estimates that in 2020, the
illustrative compliance approach for Option 1--Approach B \9\ will
yield monetized climate benefits of approximately $77 million (3
percent model average, 2011$), as shown in Table 3. The illustrative
annual compliance costs and monitoring and reporting costs are a
savings of approximately $140 million (2011$) in 2020. The quantified
2020 net benefits (the difference between monetized benefits and costs)
are $220 million (2011$) using a 3 percent discount rate. In 2030, as
shown in Table 3, the illustrative compliance approach for Option 1--
Approach B in Guam and Puerto Rico will yield monetized climate
benefits of approximately $180 million (3 percent model average,
2011$). The illustrative annual compliance costs and monitoring and
reporting costs in 2030 are a savings of $360 million, including
reduced fuel expenditures from energy efficiency programs and re-
dispatch. The quantified 2030 net benefits are $540 million (2011$, 3
percent discount rate).
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    \9\ Option 1 represents compliance with the goals calculated
using the procedure outlined in section III.B of this supplemental
proposal. As explained in more detail in section III.B, Approach B
includes an adjustment to the proposed methodology from the June 18,
2014, proposal for building block 3.
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    For Option 2--Approach B,\10\ the EPA estimates that in 2020, the
illustrative compliance approach for Guam and Puerto Rico will yield
monetized climate benefits of approximately $73 million (3 percent
model average, 2011$), as shown in Table 4. The illustrative annual
compliance costs and monitoring and reporting costs are a savings of
approximately $130 million (2011$) in 2020. The quantified 2020 net
benefits (the difference between monetized benefits and costs) are $210
million (2011$) using a 3 percent discount rate. In 2025, as shown in
Table 4, the illustrative compliance approach for Option 2--Approach B
in Guam and Puerto Rico will yield monetized climate benefits of
approximately $110 million (3 percent model average, 2011$). The
illustrative annual compliance costs and monitoring and reporting costs
in 2025 are a savings of $200 million, including reduced fuel
expenditures from energy efficiency programs and re-dispatch. The
quantified 2025 net benefits are $300 million (2011$, 3 percent
discount rate).
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    \10\ Option 2 represents compliance with the goals calculated
using the procedure outlined in section III.C of this supplemental
proposal, reflecting less stringent application of the building
blocks and a shorter implementation period.
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    For all options and approaches, the proposed guidelines would
reduce emissions of precursor pollutants (e.g., SO2,
NOX and directly emitted particles) in the territories,
which in turn would lower ambient concentrations of fine particulate
(PM2.5) and ozone (O3). Apart from the climate
benefits described above, there will also likely be significant health
co-benefits association with the projected reductions of SO2
and NOX emissions in Guam and Puerto Rico. However, the EPA
is unable to quantify these health co-benefits because the benefit-per-
ton values the EPA typically uses for this purpose are only appropriate
for areas within the continental United States. As is described in the
June 18, 2014, proposal, reducing exposure to PM2.5 is
associated with significant human health benefits, including avoiding
premature mortality for adults and infants, cardiovascular morbidities
such as heart attacks, hospital admissions and respiratory morbidities
such as asthma attacks, acute bronchitis, hospital and emergency
department visits, work loss days, restricted activity days and
respiratory symptoms. Reducing exposure to O3 is also
associated with significant human health benefits, including avoiding
mortality and respiratory morbidity such as fewer asthma attacks,
hospital and emergency room visits and school loss days.

  Table 1--Summary of the Monetized Benefits, Compliance Costs and Net
Benefits for the Proposed Guidelines for Guam and Puerto Rico--Option 1--
                             Approach A \a\
                           [Millions of 2011$]
------------------------------------------------------------------------
                                          2020                2030
------------------------------------------------------------------------
          Proposed Guidelines Illustrative Compliance Approach
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Climate Benefits \b\.............  $73...............  $170.
Annualized Capital, Energy         $24...............  $190.
 Efficiency and Monitoring,
 Reporting, & Recordkeeping Costs.
Change in Fuel Expenditure.......  -$160.............  -$540.
Total Compliance Costs \c\.......  -$140.............  -$350.

Net Monetized Benefits \d\.......  $210..............  $520.
                                  --------------------------------------
Non-monetized Benefits...........  Health benefits of reductions in SO2,
                                    NO2, PM2.5 and O3.
                                   Reductions in hazardous air
                                    pollutants (HAP) such as mercury
                                    (Hg) and hydrochloric acid (HCl).
                                   Ecosystem effects.
                                   Visibility impairment.
------------------------------------------------------------------------
\a\ All estimates are rounded to two significant figures, so figures may
  not sum.
\b\ The climate benefit estimate in this summary table reflects global
  impacts from CO2 emission changes and does not account for changes in
  non-CO2 GHG emissions. Also, different discount rates are applied to
  the social cost of carbon (SCC) than to the other estimates because
  CO2 emissions are long-lived and subsequent damages occur over many
  years. The benefit estimates in this table are based on the average
  SCC estimated for a 3 percent discount rate. However, the EPA
  emphasizes the importance and value of considering the full range of
  SCC values. As shown in the regulatory impact analysis (RIA), climate
  benefits are also estimated using the other three SCC estimates (model
  average at 2.5 percent discount rate, 3 percent and 5 percent; 95th
  percentile at 3 percent). The SCC estimates are year-specific and
  increase over time.
\c\ Total costs include capital costs, monitoring, recordkeeping, and
  reporting costs, demand side energy efficiency program and participant
  costs, and changes in fuel expenditures. Capital costs are annualized
  at a capital charge rate of 14.29 percent. Energy efficiency costs are
  calculated at a 3 percent discount rate.
\d\ The estimates of net benefits in this summary table are calculated
  using the global SCC at a 3 percent discount rate (model average). The
  RIA includes combined climate and health estimates based on these
  additional discount rates.

  Table 2--Summary of the Monetized Benefits, Compliance Costs and Net
Benefits for the Proposed Guidelines for Guam and Puerto Rico--Option 2--
                             Approach A \a\
                           [Millions of 2011$]
------------------------------------------------------------------------
                                          2020                2025
------------------------------------------------------------------------
          Proposed Guidelines Illustrative Compliance Approach
------------------------------------------------------------------------
Climate Benefits \b\.............  $68...............  $99.
Annualized Capital, Energy         $19...............  $78.
 Efficiency and Monitoring,
 Reporting, & Recordkeeping Costs.
Change in Fuel Expenditure.......  -$150.............  -270.
Total Compliance Costs \c\.......  -$130.............  -$190.
Net Monetized Benefits \d\.......  $200..............  $290.
                                  --------------------------------------
Non-monetized Benefits...........  Health benefits of reductions in SO2,
                                    NO2, PM2.5 and O3.
                                   Reductions in HAP such as Hg and HCl.
                                   Ecosystem effects.
                                   Visibility impairment.
------------------------------------------------------------------------
\a\ All estimates are rounded to two significant figures, so figures may
  not sum.
\b\ The climate benefit estimate in this summary table reflects global
  impacts from CO2 emission changes and does not account for changes in
  non-CO2 GHG emissions. Also, different discount rates are applied to
  SCC than to the other estimates because CO2 emissions are long-lived
  and subsequent damages occur over many years. The benefit estimates in
  this table are based on the average SCC estimated for a 3 percent
  discount rate. However the EPA emphasizes the importance and value of
  considering the full range of SCC values. As shown in the RIA, climate
  benefits are also estimated using the other three SCC estimates (model
  average at 2.5 percent discount rate, 3 percent and 5 percent; 95th
  percentile at 3 percent). The SCC estimates are year-specific and
  increase over time.
\c\ Total costs include capital costs, monitoring, recordkeeping, and
  reporting costs, demand side energy efficiency program and participant
  costs, and changes in fuel expenditures. Capital costs are annualized
  at a capital charge rate of 14.29 percent. Energy efficiency costs are
  calculated at a 3 percent discount rate.
\d\ The estimates of net benefits in this summary table are calculated
  using the global SCC at a 3 percent discount rate (model average). The
  RIA includes combined climate and health estimates based on these
  additional discount rates.

  Table 3--Summary of the Monetized Benefits, Compliance Costs and Net
Benefits for the Proposed Guidelines for Guam and Puerto Rico--Option 1--
                             Approach B \a\
                           [Millions of 2011$]
------------------------------------------------------------------------
                                          2020                2030
------------------------------------------------------------------------
          Proposed Guidelines Illustrative Compliance Approach
------------------------------------------------------------------------
Climate Benefits \b\.............  $77...............  $180.
Annualized Capital, Energy         $38...............  $220.
 Efficiency and Monitoring,
 Reporting, & Recordkeeping Costs.
Change in Fuel Expenditure.......  -$180.............  -$580.
Total Compliance Costs \c\.......  -$140.............  -$360.
Net Monetized Benefits \d\.......  $220..............  $540.
                                  --------------------------------------
Non-monetized Benefits...........  Health benefits of reductions in SO2,
                                    NO2, PM2.5 and O3.

                                   Reductions in hazardous air
                                    pollutants (HAP) such as mercury
                                    (Hg) and hydrochloric acid (HCl).
                                   Ecosystem effects.
                                   Visibility impairment.
------------------------------------------------------------------------
\a\ All estimates are rounded to two significant figures, so figures may
  not sum.
\b\ The climate benefit estimate in this summary table reflects global
  impacts from CO2 emission changes and does not account for changes in
  non-CO2 GHG emissions. Also, different discount rates are applied to
  the SCC than to the other estimates because CO2 emissions are long-
  lived and subsequent damages occur over many years. The benefit
  estimates in this table are based on the average SCC estimated for a 3
  percent discount rate. However, the EPA emphasizes the importance and
  value of considering the full range of SCC values. As shown in the
  RIA, climate benefits are also estimated using the other three SCC
  estimates (model average at 2.5 percent discount rate, 3 percent and 5
  percent; 95th percentile at 3 percent). The SCC estimates are year-
  specific and increase over time.
\c\ Total costs include capital costs, monitoring, recordkeeping, and
  reporting costs, demand side energy efficiency program and participant
  costs, and changes in fuel expenditures. Capital costs are annualized
  at a capital charge rate of 14.29 percent. Energy efficiency costs are
  calculated at a 3 percent discount rate.
\d\ The estimates of net benefits in this summary table are calculated
  using the global SCC at a 3 percent discount rate (model average). The
  RIA includes combined climate and health estimates based on these
  additional discount rates.

  Table 4--Summary of the Monetized Benefits, Compliance Costs and Net
Benefits for the Proposed Guidelines for Guam and Puerto Rico--Option 2--
                             Approach B \a\
                           [Millions of 2011$]
------------------------------------------------------------------------
                                          2020                2025
------------------------------------------------------------------------
          Proposed Guidelines Illustrative Compliance Approach
------------------------------------------------------------------------
Climate Benefits \b\.............  $73...............  $110.
Annualized Capital, Energy         $33...............  $98.
 Efficiency and Monitoring,
 Reporting, & Recordkeeping Costs.
Change in Fuel Expenditure.......  -$170.............  -$300.
Total Compliance Costs \c\.......  -$130.............  -$200.
Net Monetized Benefits \d\.......  $210..............  $300.
                                  --------------------------------------
Non-monetized Benefits...........  Health benefits of reductions in SO2,
                                    NO2, PM2.5 and O3.
                                   Reductions in HAP such as Hg and HCl.
                                   Ecosystem effects.
                                   Visibility impairment.
------------------------------------------------------------------------
\a\ All estimates are rounded to two significant figures, so figures may
  not sum.
\b\ The climate benefit estimate in this summary table reflects global
  impacts from CO2 emission changes and does not account for changes in
  non-CO2 GHG emissions. Also, different discount rates are applied to
  SCC than to the other estimates because CO2 emissions are long-lived
  and subsequent damages occur over many years. The benefit estimates in
  this table are based on the average SCC estimated for a 3 percent
  discount rate. However the EPA emphasizes the importance and value of
  considering the full range of SCC values. As shown in the RIA, climate
  benefits are also estimated using the other three SCC estimates (model
  average at 2.5 percent discount rate, 3 percent and 5 percent; 95th
  percentile at 3 percent). The SCC estimates are year-specific and
  increase over time.
\c\ Total costs include capital costs, monitoring, recordkeeping, and
  reporting costs, demand side energy efficiency program and participant
  costs, and changes in fuel expenditures. Capital costs are annualized
  at a capital charge rate of 14.29 percent. Energy efficiency costs are
  calculated at a 3 percent discount rate.
\d\ The estimates of net benefits in this summary table are calculated
  using the global SCC at a 3 percent discount rate (model average). The
  RIA includes combined climate and health estimates based on these
  additional discount rates.

    There are additional important benefits that the EPA could not
monetize. These unquantified benefits include climate benefits from
reducing emissions of non-CO2 GHGs (e.g., nitrous oxide and
methane) \11\ and co-benefits from reducing direct exposure to HAP
(e.g., Hg and HCl), as well as from reducing ecosystem effects and
visibility impairment.
---------------------------------------------------------------------------

    \11\ Although CO2 is the predominant greenhouse gas
released by the power sector, EGUs also emit small amounts of
nitrous oxide and methane. See Chapter 2 of the June 2014 RIA for
more detail about power sector emissions and the U.S. Greenhouse Gas
Reporting Program's power sector summary, http://www.epa.gov/ghgreporting/ghgdata/reported/powerplants.html.
---------------------------------------------------------------------------

B. Organization and Approach for This Supplemental Proposal

    This action presents the EPA's proposed emission guidelines for
developing plans to reduce GHG emissions from the electric power sector
in U.S. territories and areas of Indian country with affected EGUs.
This action is based on the analytical approach of the June 18, 2014,
proposal, and this preamble adopts and relies on all of the information
in that proposal, including the background information, explanations,
analyses, alternatives, solicitations of comment, etc.
    Section II of this supplemental proposal provides background,
implications for U.S. territories and areas of Indian country and a
summary of the EPA's stakeholder outreach efforts. Section III of this
supplemental proposal describes how this proposal is based on the
analytical approach of the June 18, 2014, proposal, including the use
of the four building blocks, as applied to each U.S. territory or each
area of Indian country with affected EGUs, for setting goals, and also
identifies the proposed goals for those areas. Section IV of this
supplemental

proposal provides an explanation of the proposed requirements for the
required jurisdictional plans, which, again, are based on the proposed
requirements in the June 18, 2014, proposal. Impacts of the proposed
action are then described in section V of this supplemental proposal,
followed by a discussion of statutory and executive order reviews in
section VI and the statutory authority for this action in section VII
of this supplemental proposal.
    In addition to relying on, and building upon, the June 18, 2014,
proposal for existing sources, this supplemental proposal is related to
two other recently proposed rulemakings for CO2 emissions:
The proposed rulemaking that the EPA published on January 8, 2014, for
newly constructed affected sources,\12\ and the proposed rulemaking
that the EPA published on June 18, 2014, for modified and reconstructed
sources.\13\ Those two rulemakings each have their own rulemaking
docket, and the comment period for those two rulemakings has closed.
This action is a supplemental proposal for the June 18, 2014, proposal
for existing sources, and, as a result, comments on this supplemental
proposal will be included in the docket for that June 18, 2014,
proposal. Accordingly, commenters who wish to comment on any aspect of
this supplemental proposal, including a topic that overlaps an aspect
of one or both of the other related rulemakings, should make those
comments on this supplemental proposal. Because this supplemental
proposed rulemaking (i) adopts and relies on the information in the
June 18, 2014, proposal, as noted above, as well as generally applies
the same analytic framework described in the June 18, 2014, proposal,
and (ii) is in the same docket as that June 18, 2014, proposal,
commenters should limit their comments on this supplemental proposed
rulemaking to the issues of the analytic framework that are relevant
for U.S. territories and areas of Indian country with affected EGUs, as
well as the question of how areas without affected sources could
participate in multi-jurisdictional plans, as discussed in the next
paragraph and in section IV.D.
---------------------------------------------------------------------------

    \12\ 79 FR 1430.
    \13\ 79 FR 34960.
---------------------------------------------------------------------------

    The EPA is also soliciting comment on whether jurisdictions--
including any states, territories and areas of Indian country--without
existing fossil fuel-fired EGUs subject to this rule can partner with
jurisdictions that are subject to this rule in developing multi-
jurisdictional plans. An important benefit of these types of
partnerships may include crediting investments that jurisdictions
without affected sources may be able to make in renewable energy (RE)
or demand-side energy efficiency resources for reducing CO2
emissions from affected sources in other jurisdictions.

II. Background

A. Carbon Pollution Emission Guidelines Proposal

    On June 18, 2014, the EPA proposed emission guidelines for states
to follow in developing plans to address greenhouse gas emissions from
existing fossil fuel-fired EGUs under the authority of CAA section
111(d).\14\ More specifically, the EPA proposed state-specific rate-
based goals for CO2 emissions from affected EGUs, as well as
guidelines for states to follow in developing plans to achieve the
state-specific goals. The EPA indicated in the June 18, 2014, proposal
that it intended to publish a supplemental proposal to establish
emission performance goals for areas of Indian country and U.S.
territories with affected EGUs.\15\
---------------------------------------------------------------------------

    \14\ 79 FR 34830.
    \15\ 79 FR 34854.
---------------------------------------------------------------------------

    The June 18, 2014, proposal discussed the climate change impacts
from GHG emissions, GHG emissions from fossil fuel-fired EGUs, the
utility power sector, statutory and regulatory requirements, pre-
proposal stakeholder outreach, the applicability requirements, the
legal basis, the authority to regulate CO2 and EGUs,
combining the two existing categories for affected EGUs into a single
category, the best system of emission reduction (BSER) and building
blocks for setting goals, guidelines for plans, implications for other
EPA programs and rules, the impacts of the June 18, 2014, proposal and
other considerations. This supplemental proposal presumes familiarity
with the June 18, 2014, proposal. Moreover, in this supplemental
proposal, the EPA relies on the information and analytic framework
provided in the June 18, 2014, proposal, is not repeating that
information and analytic framework and adopts that information and
analytic framework as they pertain to the requirements for U.S.
territories and areas of Indian country. The EPA specifically solicited
comment on the issues in the analytic framework in the June 18, 2014,
proposal.

B. Implications for U.S. Territories

    As discussed previously, the June 18, 2014, proposal for existing
sources did not propose CO2 goals for U.S. territories with
affected EGUs. The EPA indicated in the June 18, 2014, proposal that,
after conducting additional outreach, it intended to issue this
supplemental proposal to establish territory-specific rate-based goals
for CO2 emissions and guidelines for U.S. territories to
follow for the development, submission and implementation of plans to
achieve their goal. The EPA intends to take final action on this
supplemental proposal in conjunction with the final action for the June
18, 2014, proposal.
    The EPA is aware of two U.S. territories with affected EGUs: Puerto
Rico and Guam. The EPA is not aware of any affected EGUs in American
Samoa or the Commonwealth of the Northern Mariana Islands. Information
provided to the EPA indicates that there are two potentially affected
EGUs in the U.S. Virgin Islands; however, they have not been in
operation since before 2012. Therefore, in this action, Puerto Rico and
Guam are the only U.S. territories for which the EPA is proposing to
set goals. The EPA requests comment on whether there are any other
affected EGUs located in U.S. territories that were not identified for
this supplemental proposal.
    The U.S. territories are generally subject to CAA section 111(d)
requirements in the same manner as states. CAA section 111(d) imposes
obligations on ``each State,'' and CAA section 302(d) defines the term
``State'' to include the U.S. territories. As discussed in more detail
in section IV of this supplemental proposal, the CAA section 111(d)
state plan requirements for U.S. territories are the same as those
proposed for states in the June 18, 2014, proposal for existing
sources.

C. Implications for Areas of Indian Country

    Although affected EGUs located in Indian country operate as part of
the interconnected system of electricity production and distribution,
those affected EGUs would not generally be encompassed within any
state's CAA section 111(d) plan because state plans are generally not
approved in Indian country. The EPA is aware of four facilities with
affected EGUs located in Indian country: The South Point Energy Center,
in Fort Mojave Indian country geographically located within Arizona;
the Navajo Generating Station, in Navajo Indian country geographically
located within Arizona; the Four Corners Power Plant, in Navajo Indian
country geographically located within New Mexico; and the Bonanza Power
Plant, in Ute Indian country geographically located within Utah. The
South Point facility is a natural gas combined cycle (NGCC) power
plant, and the Navajo,

Four Corners and Bonanza facilities are coal-fired EGUs. The operators
and co-owners of these four facilities include investor-owned
utilities, cooperative utilities, public power agencies \16\ and
independent power producers, most of which also own or co-own affected
EGUs within states, but outside of areas of Indian country. The EPA
requests comment on whether there are any other affected EGUs located
in Indian country beyond the four facilities identified for this
supplemental proposal.
---------------------------------------------------------------------------

    \16\ One of these public power agencies is the U.S. Bureau of
Reclamation.
---------------------------------------------------------------------------

    The EPA indicated in the June 18, 2014, proposal that, after
conducting additional outreach, the agency would issue this
supplemental proposal to establish rate-based CO2 emission
performance goals for the three areas of Indian country with affected
EGUs. As noted above, the EPA intends to take final action on this
supplemental proposal in conjunction with the final action for the June
18, 2014, proposal. As discussed in more detail in section IV.B, tribes
are not required to develop plans to implement the guidelines under CAA
section 111(d) for affected EGUs in their areas of Indian country.
Pursuant to the Tribal Authority Rule (TAR),\17\ the EPA must
promulgate federal plan provisions if it determines that such
provisions are necessary or appropriate, unless a tribe on whose lands
an affected source (or sources) is located seeks and obtains authority
from the EPA to establish a plan itself. If the EPA determines that it
is necessary or appropriate to promulgate implementation plan
provisions, it will promulgate such provisions as are necessary or
appropriate to achieve CO2 emission performance goals
through a transparent public process and after providing opportunity
for consultation with the affected tribal government or governments.
---------------------------------------------------------------------------

    \17\ 63 FR 7254, February 12, 1998. See 40 CFR 49.1 to 49.11.
---------------------------------------------------------------------------

D. Additional Outreach and Consultation

    Section III (``Stakeholder Outreach and Conclusions'') of the June
18, 2014, proposal documents the EPA's extensive outreach efforts prior
to the proposal, including outreach to officials in the territories and
tribal officials. Prior to the June 18, 2014, proposal, agency
officials held meetings with the Governor of Puerto Rico, the Governor
of the U.S. Virgin Islands, the Puerto Rico Environmental Quality Board
and the U.S. Virgin Islands Department of Planning and Natural
Resources. The EPA also met with stakeholders from Puerto Rico on July
22 and 23, 2014, to provide an overview of the June 18, 2014, proposal
and ask for input on this supplemental proposal. Issues raised during
the meetings included concerns regarding the crediting of pre-2012
building block control strategies as well as resource plans that
integrate some of the building block control strategies. On September
8, 2014, the EPA met with Guam Environmental Protection Agency, Guam
Power Authority and the Consolidated Commission on Utilities to provide
an overview of the June 18, 2014, proposal and ask for input on this
supplemental proposal. Issues raised during the meeting included Guam's
plans to modify certain power plants, including introduction of ultra-
low sulfur diesel fuel and liquefied natural gas (LNG).
    Tribes are not required to, but may, develop or adopt CAA programs.
Because this supplemental proposal addresses affected sources located
within Indian country, the EPA offered consultation with tribal
officials to permit tribes to have meaningful and timely input into its
development. The EPA held consultations with all three tribes that have
affected EGUs on their lands, as well as other tribes that requested
consultation. The EPA held a consultation with the Ute Tribe, the Crow
Nation, and the Mandan, Hidatsa and Arikara (MHA) Nation (the Three
Affiliated Tribes of Ft. Berthold) on July 18, 2014, the Fort Mojave
Tribe on August 22, 2014, and the Navajo Nation on September 15, 2014.
The Navajo Nation sent a letter to the EPA on September 18, 2014,
summarizing the information presented at the consultation and the
Navajo Nation's position on this supplemental proposal. The EPA also
met with tribal environmental staff with the National Tribal Air
Association, by teleconference, on June 26, 2014, August 4, 2014, and
September 5, 2014. In those teleconferences, the EPA provided
background information on the GHG emission guidelines to be developed
and a summary of issues being explored by the agency. The tribes
expressed an interest in the scope of the guidelines being considered
by the agency (e.g., over what time period, relationship to state and
multi-state plans) and how tribes will participate in these planning
activities. Tribes raised concerns about the impacts of the regulations
on EGUs and the subsequent impact on jobs and revenue for their tribes.
The Navajo Nation raised concerns about the application of certain
building blocks to the EGUs on their lands, the impact of the proposed
rule on renewable energy projects on their lands and the ability of the
Navajo Nation to control any available carbon credits under a trading
program. Detail regarding the EPA's outreach to tribes can be found in
section VI.F of this supplemental proposal.
    The EPA has used information from these meetings to inform this
supplemental proposal. The EPA expects that a dialogue with tribal
governments and other stakeholders will continue through the comment
period and even after the rule is finalized. The EPA recognizes the
importance of working with all stakeholders to ensure a clear and
common understanding of the role they will play in addressing carbon
pollution from power plants.

III. Goals for U.S. Territories and Areas of Indian Country

A. Overview

    In this section, the EPA sets out proposed CO2 emission
performance goals to guide U.S. territories with affected EGUs in
developing their plans. The EPA also sets out proposed emission
performance goals for areas of Indian country with affected EGUs. The
proposed goals reflect the EPA's quantification of each area's adjusted
output-weighted average emission rate from affected EGUs that could be
achieved by 2030 and sustained thereafter. The EPA is also proposing
interim goals that would apply over a 2020-2029 phase-in period,
through reasonable implementation, considering the unique circumstances
of each individual area, of the BSER adequately demonstrated (based on
all four building blocks as described in the June 18, 2014, proposal).
See 79 FR 34855. These goals are presented in section III.B and are the
basis for Option 1 in the discussion of the impacts of this proposed
action in sections I.A and V. In addition, the EPA is taking comment on
a second set of area-specific goals for U.S. territories and Indian
country with affected EGUs that would reflect less stringent
application of the same BSER, in this case by 2025, with interim goals
that would apply over a 2020-2024 phase-in period. These goals are
presented in section III.C and are the basis for Option 2 in the
discussion of the impacts of this proposed action in sections I.A and
V. When promulgated in the final rule following consideration of
comments received, the interim and final goals would be binding
emission guidelines for plans in each area. See 79 FR 34893 for a
discussion of the stringency of the building blocks used to calculate
goals.

    The proposed goals are expressed in the form of area-specific,
adjusted \18\ output-weighted-average CO2 emission rates for
affected EGUs. However, jurisdictions are authorized to translate the
form of the goal to a mass-based form, as long as the translated goal
achieves the same degree of emission limitation.\19\
---------------------------------------------------------------------------

    \18\ As described below, the emission rate goals include
adjustments to incorporate the potential effects of emission
reduction measures that address power sector CO2
emissions primarily by reducing the amount of electricity produced
at an area's affected EGUs (associated with, for example, increasing
the amount of new low- or zero-carbon generating capacity or
increasing demand-side energy efficiency) rather than by reducing
their CO2 emission rates per unit of energy output
produced.
    \19\ A method for translating from a rate-based goal to a mass-
based goal is discussed in the ``Projecting CO2 Emission
Performance in State Plans Technical Support Document'' (TSD) issued
in conjunction with the June 18, 2014, proposal.
---------------------------------------------------------------------------

B. Proposed Goals and Computation Procedure

    The methodology used to compute the proposed interim and final
CO2 emission performance goals for U.S. territories and
areas of Indian country with affected EGUs mirrors to the fullest
extent possible the approach used to calculate goals for states
discussed in section VII of the preamble to the June 18, 2014,
proposal. See 79 FR 34892 for a detailed discussion of the methodology.
That methodology is described in more detail in the ``Goal Computation
Technical Support Document'' \20\ issued in conjunction with the June
18, 2014, proposal, which includes a numerical example illustrating the
full procedure. The development of the data inputs used in the
computation procedure for the state goals is discussed in section VI of
the June 18, 2014, proposal (79 FR 34855), and in the ``GHG Abatement
Measures'' TSD \21\ issued in conjunction with the June 18, 2014,
proposal. The methodology and data inputs used to compute the proposed
goals for U.S. territories and areas of Indian country are discussed in
detail in the ``Technical Support Document for Calculating Carbon
Pollution Goals for Existing Power Plants in Territories and Areas of
Indian Country,'' available in the docket for this rulemaking.
---------------------------------------------------------------------------

    \20\ This document is included in the docket with Document ID
No. EPA-HQ-OAR-2013-0602-0460.
    \21\ This document is included in the docket with Document ID
No. EPA-HQ-OAR-2013-0602-0437.
---------------------------------------------------------------------------

    The EPA has developed proposed CO2 emission performance
goals for territories and areas of Indian country with affected EGUs,
reflecting application of the BSER, based on all four building blocks
described in the June 18, 2014, proposal, to pertinent data for each
territory and area of Indian country with affected EGUs. The final goal
for each area, expressed as a CO2 emission rate on an
output-weighted-average basis, is intended to represent the emission
performance level achievable collectively by all of an area's affected
EGUs by 2030, after a 2020-2029 phase-in period, with certain
computation adjustments described below, to reflect the potential to
achieve emission reductions by avoiding fossil fuel-fired generation.
For each area, in addition to the final goal, the EPA has developed an
interim goal that would apply during the 2020-2029 period on a
cumulative or average basis as the area progresses toward the final
goal. The proposed goals are set forth in Tables 5 and 6 below,
followed by a discussion of several considerations that should be noted
regarding the computation methodology. For U.S. territories, as
detailed in the discussion of the considerations, the EPA is co-
proposing two approaches for the application of building block 3, which
are shown as approaches A and B in Table 5, and also taking comment on
an alternative to the proposed approaches for the application of
building block 3, as shown in Table 7. For areas of Indian country with
affected EGUs, the EPA is proposing one option, as shown in Table 6,
and taking comment on alternatives. (The issue of how areas could
demonstrate emission performance consistent with the interim and final
goals is addressed in section IV of this supplemental proposal, below,
which addresses plans.)

                           Table 5--Proposed Goals for Territories With Affected EGUs
      [Adjusted output-weighted-average pounds of CO2 per net MWh from all affected fossil fuel-fired EGUs]
----------------------------------------------------------------------------------------------------------------
                                            Goal using proposed approach A    Goal using proposed approach B for
                                                 for building block 3                  building block 3
                  Area                   -----------------------------------------------------------------------
                                            Interim goal       Final goal       Interim goal       Final goal
----------------------------------------------------------------------------------------------------------------
Guam....................................             1,733             1,586             1,708             1,556
Puerto Rico.............................             1,470             1,413             1,459             1,399
----------------------------------------------------------------------------------------------------------------

 Table 6--Proposed Goals for Areas of Indian Country With Affected EGUs
  [Adjusted output-weighted-average pounds of CO2 per net MWh from all
                    affected fossil fuel-fired EGUs]
------------------------------------------------------------------------
                                      Goal using proposed approach A for
                                               building block 3
                Area                 -----------------------------------
                                        Interim goal       Final goal
------------------------------------------------------------------------
Lands of the Fort Mojave Tribe......               856               855
Lands of the Navajo Nation..........             1,991             1,989
Lands of the Ute Tribe of the Uintah             2,000             1,988
 and Ouray Reservation..............
------------------------------------------------------------------------

    As stated previously, the EPA applied the same four building blocks
described in the June 18, 2014, proposal to determine the goals.
However, applying the methodology from the June 18, 2014, proposal for
building block 1 would not result in any adjustments to the goals for
Guam or the Fort Mojave Indian country because there are no coal-fired
affected EGUs in those areas. Applying the methodology for building
block 2 would not result in any adjustments to the goal for the Fort
Mojave Indian country for the same reason. Applying the methodology for
building block 2 also would not result in any adjustments to the goals
for Guam or any of the other areas of Indian country because there are
no NGCC units for re-dispatch within those areas. With respect to
Puerto Rico, the EPA believes that

existing and planned LNG import capacity in Puerto Rico supports 70
percent dispatch at the territory's existing NGCC facility in building
block 2 of goal setting.\22\
---------------------------------------------------------------------------

    \22\ The information supporting the potential for the LNG
capacity to support 70 percent dispatch is further detailed in the
``Technical Support Document for Calculating Carbon Pollution Goals
for Existing Power Plants in U.S. Territories and Areas of Indian
Country.''
---------------------------------------------------------------------------

    The EPA is co-proposing two options for the application of building
block 3 for the territories with affected EGUs. The first co-proposal
option, shown as approach A in Table 5, mirrors the proposed
methodology from the June 18, 2014, proposal for determining RE, which
applies, for each jurisdiction, an annual growth factor to the area's
baseline (that is, the year 2012) amount of RE. This methodology
applies the annual growth factor for each year from 2017 to the final
target in 2029. The EPA is also proposing this option for the
application of building block 3 for areas of Indian country, as shown
in Table 6. For the territories, the EPA applied Hawaii's 9 percent
annual growth factor because the territories appear to have relatively
similar RE resource bases and power system characteristics (e.g.,
independent utility grids and unique fossil fuel generation portfolios
with high electricity and fuel costs). For areas of Indian country, the
EPA applied the West region's 6 percent annual average growth factor
because those areas are geographically located within the West region.
However, with respect to all of the U.S. territories and areas of
Indian country for which the EPA is proposing goals in this
supplemental proposal, the available information indicates that there
was no generation from utility-scale, non-hydroelectric RE in 2012.
Because each territory and area of Indian Country has a baseline amount
of RE equal to zero, the application of the growth factor (that is,
multiplying the baseline amount of zero by the growth factor) results
in each of those areas having an RE amount of zero for building block
3. Therefore, strictly applying the methodology from the June 18, 2014,
proposal for building block 3 would result in no additional emission
reductions required, and, therefore, no change to the goals for these
areas.\23\
---------------------------------------------------------------------------

    \23\ Consistent with the methodology used in the June 18, 2014,
proposal, the proposed RE target for Puerto Rico does not include
2012 hydropower generation. The ``Technical Support Document for
Calculating Carbon Pollution Goals for Existing Power Plants in U.S.
Territories and Areas of Indian Country'' presents Puerto Rico's RE
target both with and without the inclusion of 2012 hydropower
generation.
---------------------------------------------------------------------------

    The second co-proposal option for U.S. territories with affected
EGUs, shown as approach B in Table 5, reflects a conclusion that there
is potential for RE development in the territories and includes an
adjustment to the proposed methodology, which results in a positive
amount of RE for building block 3 for each of the territories. This
adjustment is based on the EPA's view that there is in fact potential
for renewable generation in each of the territories with affected EGUs.
With this adjustment, the EPA changed the amount of RE in 2017 to be
0.37 percent of the 2012 total electricity generation, which is
consistent with the lowest amount among the 50 states in 2012.\24\
Proceeding with the methodology, the EPA then applies the annual growth
factor for each area in the assigned amount (noted above) through 2029.
Using this approach, RE targets for the U.S. territories grow from 0.37
percent to 1.0 percent of 2012 total generation by 2030. The goals
calculated using this approach are presented as proposed approach B for
building block 3 in Table 5.
---------------------------------------------------------------------------

    \24\ With 0.37 percent, Kentucky had the lowest percentage of
renewable generation in 2012. See 79 FR 34868 and Table 4-1 in the
``GHG Abatement Measures'' TSD on page 4-6.
---------------------------------------------------------------------------

    The EPA's view is that there is also potential for RE generation in
each of the areas of Indian country with affected EGUs. The EPA notes
that if the methodology described above (changing the amount of RE in
2017 to be 0.37 percent of the 2012 total electricity generation and
applying the annual growth factor for each area in the assigned amount
through 2029) is used for areas of Indian country, the amount of RE
included under this option would be a significant portion of the area's
electricity demand. This is due to the fact that, unlike all other
jurisdictions covered by the June 18, 2014, proposal and this
supplemental proposal, there are significant differences between the
electricity generation in each of the areas of Indian country with
affected EGUs and electricity demand within those same areas. Although
the basis for including RE in building block 3 as part of the BSER, as
discussed in the June 18, 2014, proposal, does not depend on the amount
of electricity demand within state, territory or area of Indian country
(79 FR 34883-34890), the Navajo Nation stated during its consultation,
that building block 3 is not appropriate for the Navajo Nation because
the tribe's use of electricity is small compared to the generation at
the power plants. The EPA seeks comment on whether the methodology co-
proposed for the territories is appropriate for areas of Indian
country, or if adjustments to the proposed option or other approaches
for the application of building block 3 for areas of Indian country are
more appropriate. For example, an RE target could be established based
on a percentage of the electric demand within the jurisdiction, where
the percentage would be consistent with the amounts of RE generation in
building block 3 in other jurisdictions (e.g. the lowest, average or
greatest percentage of RE per electric demand in other affected
jurisdictions).
    In the June 18, 2014, proposal, the EPA solicited comment on an
alternative RE approach for building block 3 that relied on technical
potential within states, and in this supplemental proposal, the EPA is
soliciting comment on that same approach as applied to U.S. territories
with affected EGUs. The goals calculated using this approach are
presented in Table 7. The EPA is presenting information on this
alternative approach for Puerto Rico. The EPA is not presenting
information on this alternative approach for Guam because the EPA does
not have technical potential data for Guam. The EPA is seeking comments
on available technical potential for Guam in order to allow us to
calculate a RE target based on the alternative approach. The EPA has
limited technical potential data for Puerto Rico--that is, only solar
photovoltaic and wind data--and is also seeking comments on available
technical potential for that jurisdiction. Even without RE market
potential data to pair with the technical potential data for Puerto
Rico, the RE target is 1.2 percent of 2012 total generation by 2030,
which is well below the mandatory renewable portfolio standard target
of 15 percent by 2020. For areas of Indian country, similar to the
discussion above regarding the application of approach B for areas of
Indian country, in light of concerns expressed by the Navajo Nation
that its use of electricity is small compared to generation at the
power plants, coupled with the fact that the amount of RE required for
each area of Indian country under this alternative approach would be in
excess of the area's electricity demand, the EPA seeks comment on the
need for, and possible types of, adjustments to the alternative
approach for the application of building block 3 for areas of Indian
country.
    The cumulative RE amounts for each territory using the two options
for the proposed approach and the alternative approach for building
block 3, represented as percentages of 2012 total generation, are shown
in Table 8. The EPA is co-proposing the two RE approaches for U.S.
territories and is

proposing one option and taking comment on alternatives for areas of
Indian country with affected EGUs, as well as seeking comment on the
alternative approach for territories. The EPA is also seeking comment
on sources of RE data from these areas.

    Table 7--Proposed Goals for Territories With Affected EGUs Using
                Alternative Approach for Building Block 3
  [Adjusted output-weighted-average pounds of CO2 per net MWh from all
                    affected fossil fuel-fired EGUs]
------------------------------------------------------------------------
                                        Goal using alternative approach
                                             for building block 3
                Area                 -----------------------------------
                                        Interim goal       Final goal
------------------------------------------------------------------------
Guam................................             1,733             1,586
Puerto Rico.........................             1,452             1,397
------------------------------------------------------------------------

                                             Table 8--RE Generation Levels for Territories Goal Development
                                                          [Percentage of 2012 total generation]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Proposed approach A  for  Proposed approach B  for   Alternative approach  for
                                                                              building block 3          building block 3           building block 3
                                                2012  Non-   2012  Total -------------------------------------------------------------------------------
                     Area                        hydro RE        RE         Interim       Final       Interim       Final        Interim
                                                (percent)     (percent)      level        level        level        level         level     Final  level
                                                                           (percent)    (percent)    (percent)    (percent)     (percent)     (percent)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Guam.........................................            0           0              0            0          0.7          1.0           0             0
Puerto Rico..................................            0           0.7            0            0          0.7          1.0           1.2           1.2
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The proposed goal computation procedure for building block 4,
demand-side energy efficiency, for U.S. territories and Indian country,
mirrors the method and data sources used for setting goals for states
to the fullest extent possible. Data sources the EPA has used for
purposes of establishing demand-side energy efficiency targets for
states are generally available for areas of Indian Country with
identified affected EGUs. These sources include reduced fuel
expenditures from demand-side energy efficiency programs (Energy
Information Administration (EIA) Form 861), retail sales (EIA Form 861)
and projections of future growth of retail sales by region (Annual
Energy Outlook (AEO)). For the U.S. territories, Guam and Puerto Rico,
however, projected retail electricity sales growth is not available
from the 2012 AEO as it was for states.\25\ The EPA is not aware of
another source for this information and, thus, is using a zero percent
per year growth rate for the retail sales data. Other values that the
EPA considered using were the recent historic sales growth value from
EIA Form 861 of -0.19 percent annually for Puerto Rico and -0.76
percent annually for Guam, or the projected sales growth rate for the
continental U.S. from the 2012 AEO of 0.78 percent per year (2012-
2040). The EPA solicits comments identifying alternative approaches
and/or data sources for projections of retail electricity sales in
these two territories. For the three areas of Indian country with
affected EGUs, the EPA was able to employ the exact same method and
data sources as used for states to compute goals for building block 4.
For the Ute Tribe of the Uintah and Ouray Reservation, the source for
retail sales is based on EIA Form 861 data for the Moon Lake Electric
Association in Utah.
---------------------------------------------------------------------------

    \25\ For states, projected retail sales growth was derived from
AEO regional results.
---------------------------------------------------------------------------

    One issue raised by the Navajo Nation during consultation was the
need to increase access to electricity in areas of Indian country where
electricity access and consumption is significantly below the national
average. For example, the Navajo Nation indicated that 32 percent of
the Navajo do not have electricity. The Navajo Nation indicated that
the goal for their area of Indian country should account for the need
to increase energy usage on their lands. The proposed goal is not
intended to limit the ability to increase the availability of
electricity in unserved portions of Indian country. The EPA notes that
the methodology for building block 4 applies demand-side energy
efficiency assuming future growth in sales of electricity, with the
goal of ensuring future growth is accomplished efficiently. For the
areas of Indian country, the EPA used the projected retail electricity
sales growth for the grid region from the 2012 AEO, which is 1.3
percent per year for the Navajo Nation and the Fort Mojave Tribe, and 1
percent per year for the Ute Tribe. The EPA requests comment on this
approach. It should also be noted that sales of electricity in areas of
Indian country are small compared to the total generation from affected
EGUs in those areas. As a result, the avoided generation due to demand-
side energy efficiency measures in building block 4 would yield very
few emission reductions and, therefore, would have a very small impact
on the overall goal for these areas. Accordingly, the EPA is seeking
comment on the appropriateness of using, in the alternative, a minimum
starting value for demand-side energy efficiency in areas of Indian
country, and what that value should be.
    The EPA invites comment on all aspects of the goal computation
procedure for U.S. territories and areas of Indian country with
affected EGUs. The EPA also specifically invites comment on the area-
specific historical data for affected EGUs in U.S. territories and
Indian country to which the building blocks are applied in order to
compute the area's goals, as well as the area-specific data for U.S.
territories and Indian country used to develop the area-specific data
inputs for building blocks 3 and 4. These data are contained in the
``Technical Support Document for Calculating Carbon Pollution Goals for
Existing Power Plants in U.S. Territories and Areas of Indian
Country.'' Consistent with the June 18, 2014, proposal, the EPA also
requests comment on whether CO2 emission reductions
associated with other measures not currently included in any of the
four proposed building blocks

should be accounted for in developing the goals for U.S. territories
and Indian country. Section VI.C.5 of the June 18, 2014, proposal
discusses such other measures. See 79 FR 34875.

C. Alternate Goals Offered for Comment and Other Approaches Considered

    Consistent with the June 18, 2014, proposal, in addition to the
proposed area-specific emission rate-based goals described above, the
EPA has developed for public comment an alternate set of goals
reflecting less stringent application of the building blocks and a
shorter implementation period. The alternate final goals represent
emission performance that would be achievable by 2025, after a 2020-
2024 phase-in period, with interim goals that would apply during the
2020-2024 period on a cumulative or average basis as areas progress
toward the final goals. As discussed in section III.B of this
supplemental proposal, the EPA is co-proposing two approaches for the
application of building block 3 for U.S. territories.
    The alternate goals are set forth in Tables 9 and 10 below. See 79
FR 34898 for a discussion of the alternate goals and how the stringency
of the building blocks used to calculate alternate goals compares to
the proposed goals.

                           Table 9--Alternate Goals for Territories With Affected EGUs
      [Adjusted output-weighted-average pounds of CO2 per net MWh from all affected fossil fuel-fired EGUs]
----------------------------------------------------------------------------------------------------------------
                                            Goal using proposed approach A      Goal using proposed approach B
                                                 for building block 3                for building block 3
                  Area                   -----------------------------------------------------------------------
                                            Interim goal       Final goal       Interim goal       Final goal
----------------------------------------------------------------------------------------------------------------
Guam....................................             1,854             1,794             1,831             1,768
Puerto Rico.............................             1,542             1,521             1,533             1,510
----------------------------------------------------------------------------------------------------------------

Table 10--Alternate Goals for Areas of Indian Country With Affected EGUs
  [Adjusted output-weighted-average pounds of CO2 per net MWh from all
                    affected fossil fuel-fired EGUs]
------------------------------------------------------------------------
                                      Goal using proposed approach A for
                                               building block 3
                Area                 -----------------------------------
                                        Interim goal       Final goal
------------------------------------------------------------------------
Lands of the Fort Mojave Tribe......               857               857
Lands of the Navajo Nation..........             2,035             2,034
Lands of the Ute Tribe of the Uintah             2,052             2,048
 and Ouray Reservation..............
------------------------------------------------------------------------

    In the June 18, 2014, proposal, the EPA discussed issues related to
the stringency and timing of these alternative goals. See 79 FR 34898.
The EPA continues to seek comment on those issues as they relate to
U.S. territories and areas of Indian country with affected EGUs.

D. Additional Considerations for U.S. Territories and Indian Country

    With respect to U.S. territories, the EPA is aware of affected EGUs
in only Puerto Rico and Guam. As noted above, although the EPA has
identified two fossil fuel-fired EGUs in the U.S. Virgin Islands,
neither of these EGUs has operated recently or is currently operating,
and, as a result, the EPA is not proposing a goal for the U.S. Virgin
Islands. The EPA plans to evaluate whether a goal is appropriate for
the U.S. Virgin Islands if either of its affected EGUs resumes
operations in the future.
    In the June 18, 2014, proposal, the EPA sought comment on issues
related to U.S. territories. In particular, the EPA solicited comment
on appropriate alternatives for those territories that do not have
access to natural gas.\26\ In addition, the EPA requested comment on
whether heat rate improvements for non-coal fossil fuel-fired EGUs,
including oil-fired steam EGUs, should be included in the building
blocks and, therefore, be part of the basis for determining the BSER,
with particular reference to the U.S. territories.\27\ The EPA is
reiterating its request for comments on those issues, including on
whether heat rate improvements are appropriate for oil-fired steam EGUs
in territories in light of the fact that these EGUs make up a large
portion of the EGU fleet in the territories.
---------------------------------------------------------------------------

    \26\ 79 FR 34893.
    \27\ 79 FR 34877.
---------------------------------------------------------------------------

    In addition, U.S. territories have many high utilization oil
combustion turbines and oil-fired combined cycle units. These units are
currently not included in the 2012 baseline because they are not
covered by the proposed CAA section 111(b) rules for CO2
emissions from newly constructed or modified/reconstructed fossil fuel-
fired EGUs. See 79 FR 1430, 1446 (January 8, 2014) (newly constructed
EGUs); 79 FR 34960, 34972 (June 18, 2014) (modified/reconstructed
EGUs). The EPA is requesting comment on the appropriateness of
including these units in the CAA section 111(d) plans for the
territories.

IV. CAA Section 111(d) Plans

A. U.S. Territories

    After the EPA establishes the jurisdiction-specific rate-based
CO2 goals in the emission guidelines, as described in
section III above, each territory that has a goal must then develop,
adopt and submit a plan under CAA section 111(d) for achieving its
goal. In the June 18, 2014, proposal, the EPA discusses at length the
procedural and substantive requirements for CAA section 111(d) plans
and solicits comment on numerous issues. Although, as noted above, that
discussion is incorporated by reference in this proposal, for
convenience, key aspects of the plan requirements are reiterated here.
    A territory must first determine the emission performance level it
will include in its plan, which entails deciding whether it will adopt
the rate-based CO2 goal set by the EPA or translate the
rate-based goal to a mass-based goal. The territory must then establish
an emission standard or set of emission standards, and, perhaps, other
measures, along with implementing and

enforcing measures, that will achieve a level of emission performance
that is equal to or better than the level specified in the plan. The
territory has discretion to choose the measures it will include in its
plan to achieve its goal as long as it can demonstrate that those
measures will achieve the goal, and those measures meet and address
necessary plan approvability criteria and plan components. The
territory may use the same set of measures as in the EPA's approach to
setting the goals, or the territory may use other or additional
measures to achieve the required CO2 reductions. A
territory's plan may rely on enforceable CO2 emission limits
that are applied directly to affected EGUs such that those limits are
sufficient to ensure compliance with the territory's CO2
performance goal, or, alternatively, the plan may take a portfolio
approach, which includes enforceable CO2 emission limits
that apply to specific affected EGUs as well as other enforceable
measures, such as RE and demand-side energy efficiency measures, which
avoid EGU CO2 emissions and are implemented by the territory
or by another entity.
    The EPA is proposing that U.S. territories follow the same
guidelines for developing their plans that were proposed for states in
the June 18, 2014, proposal. These guidelines include four general plan
approvability criteria, 12 required components for a plan to be
approvable, the process and timing for plan submittal and the process
and timing for demonstrating achievement of the CO2 emission
performance level in the plan. These guidelines are summarized briefly
below, and discussed in more detail in section VIII of the June 18,
2014, proposal.
    The EPA is proposing to evaluate and approve a territory's plan
based on four general criteria: (1) Enforceable measures that reduce
EGU CO2 emissions; (2) projected achievement of emission
performance equivalent to the goals established by the EPA, on a
timeline equivalent to that in the emission guidelines; (3)
quantifiable and verifiable emission reductions; and (4) a process for
reporting on plan implementation, progress toward achieving
CO2 goals and implementation of corrective actions, if
necessary. In addition, each territory's plan must follow the EPA
framework regulations at 40 CFR 60.23. The proposed components of the
plans that territories are required to submit under CAA section 111(d)
are as follows:
     Identification of affected entities.
     Description of plan approach and geographic scope.
     Identification of territory's emission performance level.
     Demonstration that plan is projected to achieve emission
performance level.
     Identification of programmatic milestones.
     Identification of corrective measures.
     Identification of emission standards and any other
measures.
     Demonstration that each emission standard is quantifiable,
non-duplicative, permanent, verifiable and enforceable.
     Identification of monitoring, reporting and recordkeeping
requirements.
     Description of territory's reporting.
     Certification of hearing on territory's plan.
     Supporting material.
    The plan must also include a process for annual reporting on plan
implementation, provisions ensuring progress toward achieving
CO2 goals and provisions requiring implementation of
corrective actions if necessary. No less frequently than every 2
rolling calendar years, beginning January 1, 2022, the territory will
be required to compare CO2 emission performance achieved by
affected EGUs in the territory with the emissions performance projected
in the territory's plan, and report that to the EPA.
    The proposed timetable for submission of plans by the territories
is the same as described in the June 18, 2014, proposal for the states.
That is, each territory must submit a plan to the EPA by June 30, 2016.
However, the EPA recognizes that some territories may need more than 1
year to complete all of the actions needed for their final plans,
including technical work, legislative and rulemaking activities,
coordination with third parties and coordination among jurisdictions
involved in multi-jurisdictional plans. Therefore, the EPA is proposing
an optional two-phased submittal process for plans. In phase 1, each
territory needing additional time to submit a complete plan would be
required to submit an initial plan containing certain required
components by June 30, 2016. The initial plan would also document the
reasons the territory needs more time and include commitments to take
concrete steps that will ensure that the territory will submit a
complete plan by June 30, 2017 or 2018, as appropriate. To be
approvable, the initial plan must include specific components,
including, among others, a description of the plan approach, initial
quantification of the level of emission performance that will be
achieved through the plan, a commitment to maintain existing measures
that limit CO2 emissions, an explanation of the path to
completion and a summary of the territory's response to any significant
public comment on the approvability of the initial plan.
    If the EPA does not notify the territory within 60 days that the
initial plan is deficient because it does not contain one or more of
the required components, the extension of time to submit a complete
plan will be deemed granted and a territory would have until June 30,
2017, to submit a complete plan if the geographic scope of the plan is
limited to that territory. If the territory develops a plan that
includes a multi-jurisdictional approach, it would have until June 30,
2018, to submit a complete plan. Further, the EPA is proposing that
where a territory is participating in a multi-jurisdictional plan, a
single joint plan may be submitted on behalf of all of the
participating jurisdictions, provided it is signed by authorized
officials for each of the jurisdictions participating in the plan and
contains the necessary regulations, laws, etc., for each jurisdiction
in the plan.
    The EPA is proposing the same process for EPA review of the plans
submitted by the territories as in the June 18, 2014, proposal.
Following submission of complete plans, the EPA will review plan
submittals for approvability. Given the diverse approaches territories
may take to meet the emission performance goals in the emission
guidelines, the EPA is proposing to extend the period for EPA review
and approval or disapproval of territories' plans from the 4-month
period provided in the EPA framework regulations to a 12-month period.
    The EPA is proposing the same timetables for territories to achieve
their emission performance levels as in the June 18, 2014, proposal for
states. Under this proposed timetable, a territory would need to meet
its interim CO2 emission performance level on average over
the 10-year period from 2020-2029, as well as achieve its final
CO2 emission performance level by 2030 and maintain that
level subsequently. For a more detailed discussion of the proposed
guidelines for plans, see section VIII of the June 18, 2014, proposal.
In that proposal, the EPA specifically solicited comment on several
aspects of the guidelines as they relate to state plans, and the EPA
now solicits comment on the same issues as they relate to U.S.
territories.

B. Areas of Indian Country With Affected EGUs

    The TAR identifies CAA provisions for which it is appropriate for
the EPA to grant Indian tribes treatment in the same manner as states
(TAS). Pursuant to the TAR, tribes may apply for TAS for purposes of
CAA section 111(d). As a result, a tribe that has an affected EGU
located in its area of Indian country has the opportunity, but not the
obligation, to apply for TAS status and, if granted that status by the
EPA, to develop a plan that establishes standards of performance for
CO2 emissions from affected EGUs located in its area of
Indian country. The EPA is not proposing a determination regarding any
particular tribe's eligibility for TAS or ability to regulate EGUs
located in its area of Indian country as part of this supplemental
proposal. If a tribe has an affected EGU located in its area of Indian
country, but does not seek and obtain the authority from the EPA to
establish a CAA section 111(d) plan, then the EPA has the
responsibility to establish such plans for the areas of Indian country
where affected sources are located if the EPA determines that such a
plan is necessary or appropriate. If a tribe with affected EGUs located
in its area of Indian country obtains the authority to develop and
submit a plan, the tribe would have the flexibility and authority \28\
described in section VIII of the June 18, 2014, proposal for states in
developing a plan.
---------------------------------------------------------------------------

    \28\ This authority is found in CAA section 301(d) and the TAR.
---------------------------------------------------------------------------

    The EPA asked for comment on a number of specific aspects of plans
in section VIII of the June 18, 2014, proposal, and the EPA solicits
comment on those same issues as they relate to areas of Indian country
with affected EGUs.\29\ In particular, the EPA requested comment on
whether a tribe wishing to develop and implement a CAA section 111(d)
plan should have the option of including the EGUs located in its area
of Indian country in a multi-jurisdictional plan with one or more
states, territories or tribes. As stated previously in section II.D of
this supplemental proposal, the Navajo Nation indicated during
consultation that the Navajo Nation should control, under a trading
program, any available CO2 allowances from the affected EGUs
at Navajo Generating Station and Four Corners Power Plant. The EPA also
requested comment in the June 18, 2014, proposal on whether a federal
plan for areas of Indian country with affected EGUs, should the EPA
conclude at a later date that such a plan is necessary or appropriate,
could be developed on a multi-jurisdictional basis in conjunction with
nearby (or potentially other) states developing CAA section 111(d)
state plans.
---------------------------------------------------------------------------

    \29\ For a list of the topics that the EPA is soliciting comment
on regarding plans please see http://www2.epa.gov/sites/production/files/2014-08/documents/clean-power-plan-comment-categories.pdf
under the Category heading of ``State Plans.''
---------------------------------------------------------------------------

C. Applicability of the Proposed Emission Guidelines to U.S.
Territories and Eligible Indian Tribes

    As stated previously, the EPA is proposing the same emission
guidelines for U.S. territories and tribes that seek and obtain the
authority to establish a plan that were proposed for states in the June
18, 2014, proposal. The term ``state'' as used in the emission
guidelines proposed in the June 18, 2014, proposal would encompass U.S.
territories with one or more affected EGUs that commenced construction
on or before January 8, 2014, and any Indian tribe that has been
approved by the EPA pursuant to 40 CFR 49.9 as eligible to administer
the emission guidelines, in addition to the 50 states and the District
of Columbia that have one or more affected EGUs. The EPA believes that
this is the case without the need for the emission guidelines to
directly and separately refer to these entities. Section 302(d) of the
CAA defines the term ``State'' to include the Commonwealth of Puerto
Rico, the Virgin Islands, Guam, American Samoa and the Commonwealth of
the Northern Mariana Islands. While 40 CFR part 60 contains a separate
definition of ``state'' at Sec.  60.2, this definition expands on,
rather than narrows, the definition in section 302(d) of the CAA. The
introductory language to 40 CFR 60.2 provides: ``The terms in this part
are defined in the Act or in this section as follows.'' Section 60.2
defines ``State'' as ``all non-Federal authorities, including local
agencies, interstate associations, and State-wide programs that have
been delegated authority to implement: (1) The provisions of this part
and/or (2) the permit program established under part 70 of this
chapter. The term State shall have its conventional meaning where clear
from the context.'' (Emphasis added.) The EPA believes that the last
sentence refers to the conventional meaning of ``state'' under the CAA.
Thus, the EPA believes the term ``state'' as used in the emission
guidelines is most reasonably interpreted as including the meaning
ascribed to that term in section 302(d) of the CAA, which expressly
includes U.S. territories. Further, an Indian tribe with one or more
affected EGUs in its area of Indian country seeking to obtain approval
of a plan would need to be approved by the EPA as eligible to
administer the emission guidelines following the procedure set forth in
40 CFR part 49. Once a tribe is approved as eligible for that purpose,
it would be treated in the same manner as a state, and references in
the emission guidelines to states would refer equally to the tribe. The
EPA notes that while tribes have the opportunity to apply for
eligibility to administer CAA programs, they are not required to do so.
Further, the EPA has established procedures in 40 CFR part 49 (see
particularly 40 CFR 49.7(c)) that permit eligible tribes to request
approval of reasonably severable partial program elements. Those
procedures are applicable here. Although the EPA believes the current
emission guidelines are sufficiently inclusive, the EPA has decided to
amend the applicability provision of the emission guidelines slightly
to avoid any doubt that the guidelines apply to territories with
affected EGUs and to any Indian tribe that has been approved by the EPA
as eligible to develop and implement a plan. The revised regulatory
text can be found in the ``Amended Regulatory Text for Supplemental
Proposal: Carbon Pollution Emission Guidelines for Existing Power
Plants in Indian Country and U.S. Territories'' memo in the rulemaking
docket.

D. Areas Without Affected EGUs \30\
---------------------------------------------------------------------------

    \30\ It should be noted that this subsection applies to all
types of areas, and not just territories and areas of Indian
Country.
---------------------------------------------------------------------------

    Certain areas, including the state of Vermont, the District of
Columbia, certain U.S. territories and most areas of Indian country, do
not have any affected EGUs. Numerous stakeholders have expressed
interest in areas that do not have affected EGUs having the opportunity
to participate in multi-jurisdictional plans with areas that have
affected EGUs. With this approach, an area without affected EGUs, which
in many cases consumes energy produced elsewhere, could contribute to
meeting a multi-jurisdictional CO2 goal with its RE
resources, demand-side energy efficiency programs and other new low- or
non-emitting electricity generation.\31\ The Navajo Nation, which does
have affected EGUs on its lands, also expressed an interest during
consultation in the ability of RE resources on the Navajo Nation to
contribute to the achievement of state CO2 goals.
---------------------------------------------------------------------------

    \31\ See the June 18, 2014, proposal at 79 FR 34923 for a more
robust description of how new NGCC can aid in meeting a
jurisdiction's goal.

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

    The EPA requests comment on whether areas without affected EGUs may
participate in multi-jurisdictional plans. The EPA requests comment on
whether there are considerations that would specifically pertain to a
multi-jurisdiction mass-based plan versus a rate-based plan. The EPA
also requests comment on how CO2 emissions avoided through
RE generating resources,\32\ demand-side energy efficiency measures,
and other new low- and non-emitting electricity generation from areas
without affected EGUs could be used to adjust or credit CO2
emission rates in states required to develop CAA section 111(d) plans.
The EPA also requests comment on how RE generating resources, demand-
side energy efficiency measures, and other new low- and non-emitting
electricity generation in areas of Indian country that do have affected
EGUs can be included, and if their inclusion is dependent upon whether
or not the tribe has adopted a CAA section 111(d) plan or EPA has made
a finding and adopted a federal plan for that area of Indian country.
---------------------------------------------------------------------------

    \32\ Further discussion of applying RE (in particular renewable
energy certificates) across jurisdiction borders can be found in the
``State Plan Considerations'' TSD, which is available in the docket
for this rulemaking.
---------------------------------------------------------------------------

    Some stakeholders are also interested in the treatment of RE across
international boundaries, particularly in instances where entities in
another country are providing, or could provide, low- or non-emitting
electricity generation to serve an area in the United States. In
particular, stakeholders have asked whether RE resources from Canada
can be used to contribute to meeting a jurisdiction's goal. The EPA is
soliciting comment on all aspects of the treatment of RE, demand-side
energy efficiency, and other new low- or non-emitting electricity
generation across international boundaries in a CAA section 111(d)
plan, considering the components for approvable plans described in the
June 18, 2014, proposal, including any mechanisms that could be used to
ensure that the low or non-emitting generation was in fact offsetting
fossil-fuel-fired generation in the jurisdiction that would use it to
meet its goal.
    It should be noted that multi-jurisdictional plans that include
areas without affected EGUs must still meet the plan components and
criteria to determine whether a state's plan is ``satisfactory'' under
CAA section 111(d)(2)(A) as described in section VIII of the June 18,
2014, proposal.\33\ The EPA solicits comment on these components and
criteria for jurisdictions without affected EGUs that wish to be a part
of a multi-jurisdiction plan.
---------------------------------------------------------------------------

    \33\ For more information on plan components see the June 18,
2014, proposal at 79 FR 34911.
---------------------------------------------------------------------------

V. Impacts of the Proposed Action

A. What are the air impacts?

    With regard to Guam and Puerto Rico, the EPA estimates
implementation of Option 1--Approach A \34\ will result in emission
reductions of roughly 1.6 million metric tons of CO2 in 2020
and reductions of 3.1 million metric tons of CO2 in 2030.
The EPA estimates that implementation of Option 2--Approach A \35\
would result in emission reductions of roughly 1.5 million metric tons
of CO2 in 2020 and reductions of 2.0 million metric tons of
CO2 in 2025.
---------------------------------------------------------------------------

    \34\ Option 1 represents compliance with the goals calculated
using the procedure outlined in section III.B of this supplemental
proposal.
    \35\ Option 2 represents compliance with the goals calculated
using the procedure outlined in section III.C of this supplemental
proposal, reflecting less stringent application of the building
blocks and a shorter implementation period.
---------------------------------------------------------------------------

    For Guam and Puerto Rico, the EPA estimates implementation of
Option 1--Approach B \36\ will result in emission reductions of roughly
1.7 million metric tons of CO2 in 2020 and reductions of 3.3
million metric tons of CO2 in 2030. The EPA estimates that
implementation of Option 2--Approach B \37\ would result in emission
reductions of roughly 1.6 million metric tons of CO2 in 2020
and reductions of 2.1 million metric tons of CO2 in 2025.
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    \36\ Option 1 represents compliance with the goals calculated
using the procedure outlined in section III.B of this supplemental
proposal.
    \37\ Option 2 represents compliance with the goals calculated
using the procedure outlined in section III.C of this supplemental
proposal, reflecting less stringent application of the building
blocks and a shorter implementation period.
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    For all options and approaches, the EPA also expects reductions of
criteria pollutants including SO2, NOX and
PM2.5 as a result of actions taken to implement the goals
proposed in this action. Due to data limitations, the EPA is not able
to accurately estimate the co-reductions of criteria pollutant that
would occur as a result of actions to implement the proposed goals.
    The EPA does not expect any additional emission reductions from
areas of Indian country with affected EGUs. The EGUs in the Navajo
Nation's area of Indian country are already expected to meet the
proposed goals through compliance with other regulations. Three EGUs at
Four Corners Power Plant shut down at the beginning of 2014 to comply
with requirements for Best Available Retrofit Technology (BART).\38\ At
Navajo Generating Station, the EPA expects that by 2019, one EGU will
shut down or generation will be curtailed to comply with requirements
for BART.\39\ These units represented approximately 30 percent of total
EGU CO2 emissions in Navajo territory in 2012. As a result,
substantial CO2 reductions from the shutdowns are expected
prior to the target date for the goals proposed in this action, which
would mean the Navajo territory would meet the proposed goal without
additional actions beyond the shutdowns, if the goal is converted to a
mass-based goal. The reductions associated with compliance with the
goals for the lands of the Fort Mojave Tribe and the Ute Tribe of the
Uintah and Ouray Reservation were already accounted for in the June 18,
2014, proposal. The impacts analysis for the June 18, 2014, proposal
did not separate out and exclude electricity demand and reduced fuel
expenditures associated with energy efficiency from tribal lands from
the states in which they are located. Thus, the emission reductions
associated with achieving reduced electricity generation levels of
building block 4 as part of this supplemental proposal were previously
accounted for in the June 18, 2014, proposal. There is one affected EGU
on Ute territory. This EGU was not an affected unit in the June 18,
2014, proposal, but had the option to implement a heat rate improvement
in the system-wide modeling conducted for that proposal.\40\ Because
the modeling reflected this optional heat rate improvement, the
emission reductions from a heat rate improvement for this EGU were
accounted for in the June 18, 2014, proposal.
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    \38\ See 79 FR 46514, August 24, 2012.
    \39\ See 77 FR 51620, August 8, 2014.
    \40\ See Integrated Planning Model results at: http://www.epa.gov/airmarkets/powersectormodeling/cleanpowerplan.html.
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B. What are the energy impacts?

    As discussed previously, one area of Indian country with affected
EGUs is expected to meet the proposed goal based on compliance with
other regulations, and the impacts of compliance with the proposed
goals for the other two areas were already accounted for in the June
18, 2014, proposal. In U.S. territories, the EPA anticipates a small
degree of re-dispatch from coal- and oil-fired generation to natural
gas-fired generation. It is possible that some portion of this shift
away from coal- and oil-fired generation may occur in the absence of
the rule, due primarily to the relatively high cost of petroleum-based
fuel and electricity in these areas. For example, the Puerto

Rico Electric Power Authority (PREPA) plans to add natural gas capacity
at existing petroleum-burning plants. Additionally, both Guam and
Puerto Rico are implementing Renewable Portfolio Standards programs.
    While the EPA did not perform a full resource adequacy analysis as
was conducted for the June proposal, the EPA does not expect actions
taken to implement the proposed goals to raise reliability concerns
because these actions are likely consistent with planned activities in
the affected areas. (For example, present and planned actions on Navajo
territory to implement criteria pollutant reductions and planned
expansion of natural gas-fired capacity in Puerto Rico.)

C. What are the compliance costs?

    The compliance costs of this proposed action are represented in
this analysis as the change in electric power generation costs between
the base case and the proposed rule in which U.S. territories pursue a
distinct set of strategies beyond the strategies taken in the base case
to meet the proposed goals. The compliance assumptions and projected
compliance costs set forth in this analysis are illustrative in nature.
There is uncertainty about the precise measures that territories will
adopt to meet the proposed requirements, because there are considerable
flexibilities afforded to them in developing their state plans. These
illustrative compliance scenarios are designed to reflect, to the
extent possible, the scope and the nature of the proposed guidelines.
    For Guam and Puerto Rico, the illustrative annual compliance costs
and monitoring and reporting costs for Option 1--Approach A are a
savings of approximately $140 million (2011$) in 2020 and a savings of
$350 million in 2030, including reduced fuel expenditures from energy
efficiency programs and re-dispatch. For Option 2--Approach A, the
illustrative annual compliance costs and monitoring and reporting costs
for Guam and Puerto Rico are a savings of approximately $130 million
(2011$) in 2020 and a savings of $190 million in 2025, including
reduced fuel expenditures from energy efficiency programs and re-
dispatch.
    For Guam and Puerto Rico, the illustrative annual compliance costs
and monitoring and reporting costs for Option 1--Approach B are a
savings of approximately $140 million (2011$) in 2020 and a savings of
$360 million in 2030, including reduced fuel expenditures from energy
efficiency programs and re-dispatch. For Option 2--Approach B, the
illustrative annual compliance costs and monitoring and reporting costs
for Guam and Puerto Rico are a savings of approximately $130 million
(2011$) in 2020 and a savings of $200 million in 2025, including
reduced fuel expenditures from energy efficiency programs and re-
dispatch.
    The EPA does not expect any additional compliance costs for areas
of Indian country with affected EGUs. As discussed in section V.A of
this supplemental proposal, the EPA expects that the goal for the lands
of the Navajo Nation will be met without any further action beyond the
shutdowns that are occurring, if the goal is converted to a mass-based
goal. The costs for meeting the goal for the lands of the Fort Mojave
Tribe and the Ute Tribe of the Uintah and Ouray Reservation were
already included in the June 18, 2014, proposal.

D. What are the economic and employment impacts?

    Changes in supply or demand for electricity, natural gas, oil and
coal can impact markets for goods and services produced by sectors that
use these energy inputs in the production process or that supply those
sectors. Changes in cost of production may result in changes in price
and/or quantity produced and these market changes may affect the
profitability of firms and the economic welfare of their consumers. The
EPA recognizes that these guidelines provide significant flexibilities
and the territories implementing the guidelines may choose to mitigate
impacts to some markets outside the EGU sector. Similarly, demand for
new generation or energy efficiency can result in changes in production
and profitability for firms that supply those goods and services. The
guidelines provide flexibility for territories that may want to enhance
demand for goods and services from those sectors.
    Executive Order 13563 directs federal agencies to consider
regulatory impacts on job creation and employment. According to the
Executive Order, ``our regulatory system must protect public health,
welfare, safety, and our environment while promoting economic growth,
innovation, competitiveness, and job creation. It must be based on the
best available science.'' Although standard benefit-cost analyses have
not typically included a separate analysis of regulation-induced
employment impacts, during periods of sustained high unemployment,
employment impacts are of particular concern and questions may arise
about their existence and magnitude.
    Under all scenarios analyzed for the territories of Guam and Puerto
Rico, the annualized costs of the illustrative compliance strategies
are expected to be negative for each year in the analysis as a result
of reductions in field expenditures. Quantifying any employment impacts
associated with implementing the proposed goals is difficult, as each
area has the flexibility to implement a wide range of policies and
practices for compliance with the proposed goals. The June 18, 2014,
proposal used the cost projections from the engineering-based
Integrated Planning Model to help estimate employment impacts in the
electricity, natural gas and coal sectors, but these projections are
not available for territories, making quantitative assessment of
employment impacts for Guam and Puerto Rico more difficult. However,
because annualized costs for the territories are relatively low or
negative, the EPA does not expect significant adverse employment
impacts under the illustrative compliance strategies. A critical
component of the overall labor impacts of implementing the GHG
guidelines is the impact of the labor associated with the demand-side
energy efficiency activities. Like the RIA for the June 18, 2014,
proposal indicated, the EPA anticipates that this rule may stimulate
investment in clean energy technologies and services, resulting in
considerable increases in energy efficiency in particular. The EPA
expects these increases in energy efficiency, specifically, to support
a significant number of jobs existing in related industries.
    The EPA does not expect any economic or employment impacts for EGUs
in Indian country arising from this proposed action, as the costs for
meeting the proposed goals for the lands of the Fort Mojave Tribe and
the Ute Tribe of the Uintah and Ouray Reservation were already
accounted for in the June 18, 2014, proposal, and the goal for the
lands of the Navajo Nation is expected to be met without any further
action beyond the shutdowns that are occurring.

E. What are the benefits of the proposed action?

    The EPA has used the SCC estimates presented in the 2013
``Technical Support Document: Technical Update of the Social Cost of
Carbon for Regulatory Impact Analysis Under Executive Order 12866''
(2013 SCC TSD) to analyze CO2 climate benefits of this
rulemaking.\41\

The EPA refers to these estimates, which were developed by the U.S.
government, as ``SCC estimates.'' The U.S. government first published
the SCC estimates in 2010 following an interagency process that
included the EPA and other executive branch entities; the process used
three integrated assessment models (IAM) to develop SCC estimates and
selected four global values for use in regulatory analyses. The U.S.
government recently updated these estimates using new versions of each
IAM and published them in 2013. The 2013 update did not revisit the
2010 modeling decisions (e.g., with regard to the discount rate,
reference case socioeconomic and emission scenarios or equilibrium
climate sensitivity). Rather, improvements in the way damages are
modeled are confined to those that have been incorporated into the
latest versions of the models by the developers themselves and
published in the peer-reviewed literature. The 2010 SCC TSD provides a
complete discussion of the methods used to develop these estimates and
the 2013 SCC TSD presents and discusses the updated estimates.\42\
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    \41\ Docket ID No. EPA-HQ-OAR-2013-0495, Technical Support
Document: Technical Update of the Social Cost of Carbon for
Regulatory Impact Analysis Under Executive Order 12866, Interagency
Working Group on Social Cost of Carbon, with participation by
Council of Economic Advisers, Council on Environmental Quality,
Department of Agriculture, Department of Commerce, Department of
Energy, Department of Transportation, Environmental Protection
Agency, National Economic Council, Office of Energy and Climate
Change, Office of Management and Budget, Office of Science and
Technology Policy, and Department of Treasury (May 2013, Revised
November 2013). Available at: http://www.whitehouse.gov/sites/default/files/omb/assets/inforeg/technical-update-social-cost-of-carbon-for-regulator-impactanalysis.pdf.
    \42\ Docket ID No. EPA-HQ-OAR-2009-0472-114577, Technical
Support Document: Social Cost of Carbon for Regulatory Impact
Analysis Under Executive Order 12866, Interagency Working Group on
Social Cost of Carbon, with participation by the Council of Economic
Advisers, Council on Environmental Quality, Department of
Agriculture, Department of Commerce, Department of Energy,
Department of Transportation, Environmental Protection Agency,
National Economic Council, Office of Energy and Climate Change,
Office of Management and Budget, Office of Science and Technology
Policy, and Department of Treasury (February 2010). Also available
at: http://www.whitehouse.gov/sites/default/files/omb/inforeg/for-agencies/Social-Cost-of-Carbon-for-RIA.pdf.
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    The EPA and other agencies have sought public comment on the SCC
estimates as part of various rulemakings. In addition, OMB's Office of
Information and Regulatory Affairs recently sought public comment on
the approach used to develop the estimates. The comment period ended on
February 26, 2014, and OMB is reviewing the comments received.
    The four SCC estimates, updated in 2013, are as follows: $13, $46,
$68 and $137 per metric ton of CO2 emissions in the year
2020 (2011 dollars).\43\ The first three values are based on the
average SCC from the three IAMs, at discount rates of 5, 3 and 2.5
percent, respectively. SCCs at several discount rates are included
because the literature shows that the SCC is quite sensitive to
assumptions about the discount rate, and because no consensus exists on
the appropriate rate to use in an intergenerational context (where
costs and benefits are incurred by different generations). The fourth
value is the 95th percentile of the SCC from all three models at a 3
percent discount rate. It is included to represent higher-than-expected
impacts from temperature change further out in the tails of the SCC
distribution (representing less likely, but potentially catastrophic,
outcomes).
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    \43\ The 2010 and 2013 TSDs present SCC in $2007. The estimates
were adjusted to 2011$ using the GDP Implicit Price Deflator. Also
available at: http://www.gpo.gov/fdsys/pkg/ECONI-2013-02/pdf/ECONI-2013-02-Pg3.pdf.
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    The proposed guidelines would reduce emissions of precursor
pollutants (e.g., SO2, NOX and directly emitted
particles) in the territories, which in turn would lower ambient
concentrations of PM2.5 and O3. However, the EPA
is unable to quantify the health co-benefits of SO2 and
NOX reductions in the U.S. territories because the benefit-
per-ton values the EPA used in the June 18, 2014, proposal are only
appropriate for areas within the continental U.S. These benefit-per-ton
values are not appropriate to use in estimating co-benefits for the
U.S. territories because those territories were not represented in the
air quality modeling used to generate the benefit-per-ton estimate.
    As described in the June 18, 2014, proposal, reducing exposure to
PM2.5 is associated with significant human health benefits,
including avoiding premature mortality for adults and infants,
cardiovascular morbidities such as heart attacks, hospital admissions,
and respiratory morbidities such as asthma attacks, acute bronchitis,
hospital and emergency department visits, work loss days, restricted
activity days, and respiratory symptoms. Reducing exposure to
O3 is also associated with significant human health
benefits, including avoiding mortality and respiratory morbidity such
as fewer asthma attacks, hospital and emergency room visits and school
loss days. In addition, the EPA could not monetize other important
benefits, including climate benefits from reducing emissions of non-
CO2 GHG and co-benefits from reducing exposure to HAP (e.g.,
Hg and HCl) concentrations, as well as ecosystem and visibility
benefits.
    For Guam and Puerto Rico, the EPA estimates that in 2020, the
illustrative compliance approach for Option 1--Approach A will yield
monetized climate benefits of approximately $73 million with a 3