violating the 2015 ozone NAAQS, the data indicate no future air quality
problem for this NAAQS by the relevant 2024 attainment date for that
standard. Thus, although commenters state that current ambient
monitoring data in Delaware for 2018 shows that three of Delaware's
monitors (all in New Castle County) are exceeding the 2015 ozone NAAQS,
the commenters have not provided any basis for the EPA to conclude that
Delaware will have an air quality problem relative to the 2015 ozone
NAAQS in the future year that it has selected as relevant for this
analysis.
    Additionally, commenters challenge the EPA's conclusion that
Delaware does not have an air quality problem for the 2008 ozone NAAQS
by pointing out that the Bellefonte site in Delaware has recorded 8-
hour daily maximum values which exceed even the 1997 ozone NAAQS. These
exceedances at the Bellefonte site are not relevant to actual or
projected nonattainment or maintenance issues. Although there may be
some exceedances of the 2008 ozone NAAQS at the Bellefonte monitor, the
EPA does not have information to indicate that the fourth highest daily
ozone value averaged across 3 consecutive years will exceed the 2008
ozone NAAQS at this site. The commenter has not provided information
indicating that the monitor is currently violating the 2008 NAAQS.\46\
As noted in this section,

individual exceedances at monitors do not by themselves indicate that a
state is not attaining or maintaining the NAAQS. Thus, we have no basis
to conclude there are any air quality problems with respect to the 2008
NAAQS in Delaware in a manner relevant for step one of the four-step
transport framework. Thus, because all monitors were projected to
attain and maintain the standard in the CSAPR Update modeling and are
attaining the standard in the most recent monitoring period, the EPA
has no basis to conclude that the sources in the upwind states emit or
would emit in violation of the good neighbor provision in Delaware for
the 2008 NAAQS.
---------------------------------------------------------------------------

    \46\ The most current official design value at this monitor is
71 ppb. See 2017 Design Value Reports, available at https://www.epa.gov/sites/production/files/2018-07/ozone_designvalues_20152017_final_07_24_18.xlsx.
---------------------------------------------------------------------------

    Commenters point out that monitors in the Philadelphia
nonattainment area, located outside of the state of Delaware, are
violating both the 2008 and 2015 ozone NAAQS. The commenters assert
that because Delaware's New Castle County is included with other
counties which make up the Philadelphia nonattainment area for both the
2008 and 2015 ozone NAAQS, Delaware's attainment of the ozone NAAQS is
tied to the attainment of the other monitors in the nonattainment area.
    The EPA disagrees with commenter's suggestion that non-attaining
monitoring data for nearby receptors outside the petitioning state
support a CAA section 126(b) finding for Delaware, even if such
monitors are located in a multistate nonattainment area that includes
the petitioning state. The specific language of CAA section 126(b) does
not say that a state may petition the EPA for a finding that emissions
from a source, or group of sources, is impacting downwind receptors in
a state other than the petitioning state. In addition, the legislative
history for this provision suggests the provision was meant to address
adverse air impacts only in the petitioning state.\47\ Given the
broader context of CAA section 126, the EPA reasonably interprets CAA
section 126(b)'s petition authority to be limited to states and
political subdivisions seeking to address interstate transport of
pollution impacting downwind receptors within their geographical
borders.
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    \47\ When section 126 was added to the CAA, the Senate's
amendment implementing the basic prohibition on interstate pollution
stated that: ``Any State or political subdivision may petition the
Administrator for a finding that a major stationary source in
another state emits pollutants which would adversely affect the air
quality in the petitioning State.'' (emphasis added). Clean Air Act
Amendments of 1977, H.R. 95-564, 95th Cong. at 526 (1977). The House
concurred with the Senate's amendment to CAA section 126, with
changes to other portions of the amendment, but did not indicate
changes to this sentence. Id. The lack of stated changes to this
component of the Senate's original amendment suggest that Congress
did not intend for the scope of the petitioning authority to be
expanded to parties other than a state or political division in
which downwind air quality is adversely affected.
---------------------------------------------------------------------------

    Additionally, the context of CAA section 126 as a whole suggests
these provisions are meant to moderate interstate transport concerns
between affected states and upwind sources, not between any third party
(even if such party is another state) and upwind sources. CAA section
126(a), for example, requires upwind sources to provide notification of
certain potential air quality impacts to nearby states which may be
affected by the source, not to all states. Furthermore, CAA section
126(b) petitions may only be filed by states and political
subdivisions. By contrast, other provisions that contain petition
authority under the CAA expressly allow for any person to petition the
EPA (e.g., CAA section 505(b)(2)'s authority for any person to petition
the EPA to object to the issuance of a Title V petition). The more
restrictive text in CAA section 126(b) suggests that Congress intended
access to the petition process to be narrowly available to states and
political subdivisions directly affected by upwind pollution.
    While the acknowledgement of multistate nonattainment areas in the
CAA reflects Congress's understanding that pollution crosses state
boundaries, that does not indicate that Congress clearly authorized all
states in a multistate nonattainment area to petition EPA under CAA
section 126(b) related to violating monitors outside their state.
Portions of Delaware were included in the Philadelphia nonattainment
area because the EPA determined that those portions were themselves
contributing to the air quality problems in Pennsylvania.\48\ Nothing
in the CAA suggests that section 126(b) was intended to relieve states
like Delaware of the specific planning obligations associated with its
inclusion in an area designated nonattainment. To the extent a state
has concerns about the impacts of upwind pollution on out-of-state
monitors in a shared multistate nonattainment area, these issues can be
addressed under other statutory processes. For example, every state has
an obligation to submit a transport SIP under CAA section
110(a)(2)(D)(i)(I) that contains provisions adequate to prohibit
emissions activity that contribute significantly to nonattainment or
interfere with maintenance of the NAAQS in another state, which may
also include a multistate nonattainment area if such area is being
impacted by upwind emissions activity.
---------------------------------------------------------------------------

    \48\ See Philadelphia-Wilmington-Atlantic City, PA-NJ-;MD-DE
Nonattainment Area Final Designations for the 2015 Ozone National
Ambient Air Quality Standards Technical Support Document. Available
at https://www.epa.gov/sites/production/files/2018-05/documents/phila_tsd_final.pdf.
---------------------------------------------------------------------------

    Furthermore, the commenters' assertion that monitors in the
Philadelphia nonattainment area are currently measuring exceedances of
the 2015 ozone NAAQS does not change the EPA's conclusion that Delaware
has no air quality problem under the 2015 ozone NAAQS when looking
toward a relevant future year. As described in Section IV.A of this
notice, the EPA evaluates downwind ozone air quality problems for the
purposes of step one of the four-step framework using modeled future
air quality concentrations for a year that considers the relevant
attainment deadlines for the NAAQS. Recent analyses projecting emission
levels to a future year indicate that no air quality monitors in
Delaware are projected to have nonattainment or maintenance problems
with respect to the 2015 ozone NAAQS by 2023.\49\ Therefore, consistent
with the EPA's interpretation of the term ``will'' in the good neighbor
provision, available future year information does not suggest Delaware
will have air quality concerns by the relevant attainment date for the
2015 ozone NAAQS. Under step one of the transport framework, since
there are no projected nonattainment or maintenance receptors in
Delaware, the EPA concludes that it does not have sufficient evidence
to determine that the upwind states and sources are significantly
contributing to nonattainment or interfering with maintenance of the
2015 ozone NAAQS in Delaware.\50\
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    \49\ See Supplemental Information on the Interstate Transport
State Implementation Plan Submissions for the 2008 Ozone National
Ambient Air Quality Standards under Clean Air Act Section
110(a)(2)(D)(i)(I) (October 2017), available in the docket for this
proposed action.
    \50\ The EPA notes that even if the Philadelphia area monitors
were relevant to the EPA's analysis of Delaware's petition, EPA's
analysis also shows that those monitors are not projected to have
nonattainment or maintenance problems with respect to the 2015 ozone
NAAQS by 2023.
---------------------------------------------------------------------------

    Several comments challenged the EPA's reliance on air quality
modeling projections for 2023 to indicate that Delaware will not have
an air quality problem under the 2015 ozone NAAQS. First, commenters
asserted that even if attainment of the 2015 ozone NAAQS was assured
for the Philadelphia nonattainment area by 2023, this

analytic year is unacceptable because the agency should consider the
August 2, 2021, marginal area attainment date as informative to the
selection of an analytic year. The EPA does not agree that it is
required to analyze air quality in a future year aligned with the
attainment date for nonattainment areas classified as Marginal for the
2015 ozone NAAQS. Although the North Carolina decision held that the
EPA must consider attainment dates in downwind states when establishing
compliance timeframes for emission reductions in upwind states, the
decision did not speak to which attainment date should influence the
EPA's evaluation when there are several potentially relevant attainment
dates. As the decision explains, the good neighbor provision instructs
the EPA and states to apply its requirements ``consistent with the
provisions of'' title I of the CAA. North Carolina, 531 F.3d. at 911-
12. The EPA notes that this consistency instruction follows the
requirement that plans ``contain adequate provisions prohibiting''
certain emissions in the good neighbor provision. The EPA, therefore,
interprets the requirements of the good neighbor provision to apply in
a manner consistent with the designation and planning requirements in
title I that apply in downwind states and, in particular, the timeframe
within which downwind states are required to implement specific
emissions control measures in nonattainment areas relative to the
applicable attainment dates. See id. at 912 (holding that the good
neighbor provision's reference to title I requires consideration of
both procedural and substantive provisions in title I).
    Ozone nonattainment areas classified as Marginal are not generally
required to implement specific emission controls at existing sources.
See CAA section 182(a).\51\ Existing regulations--either local, state,
or federal--are typically a part of the reason why ``additional'' local
controls are not needed to bring the area into attainment. As described
in the EPA's record for its Classifications and Attainment Deadlines
rule for the 2015 ozone NAAQS, history has shown that the majority of
areas classified as Marginal for prior 8-hour ozone standards attained
the respective standards by the Marginal attainment date (i.e., without
being re-classified to a Moderate designation). 83 FR 10376. As part of
an historical lookback, the EPA calculated that by the relevant
attainment date for areas classified as Marginal, 85 percent of such
areas attained the 1979 1-hour ozone NAAQS, and 64 percent attained the
2008 ozone NAAQS. Id. at Response to Comments, section A.2.4.\52\ Based
on these historical data, the EPA expects that many areas classified
Marginal for the 2015 ozone NAAQS will attain by the relevant
attainment date as a result of emission reductions that are already
expected to occur through implementation of existing local, state, and
federal emission reduction programs. To the extent states have concerns
about meeting their attainment deadline for a Marginal area, the CAA
under section 181(b)(3) provides authority for them to voluntarily
request a higher classification for individual areas, if needed. Where
the ozone nonattainment area is classified as Moderate or higher, the
responsible state is required to develop an attainment plan, which
generally includes the application of various control measures to
existing sources of emissions located in the nonattainment area,
consistent with the requirements in Part D of title I of the Act. See
generally CAA section 182.
---------------------------------------------------------------------------

    \51\ New source review (NSR) and conformity are still required
for marginal areas, but their purpose is to ensure that new
emissions don't interfere with attainment as opposed to reducing
existing emissions.
    \52\ Available at https://www.regulations.gov/document?D=EPA-HQ-OAR-2016-0202-0122.
---------------------------------------------------------------------------

    Thus, given that downwind states are generally not required to
impose additional controls on existing sources in a Marginal
nonattainment area, the EPA believes that it would be inconsistent to
interpret the good neighbor provision as requiring the EPA to evaluate
the necessity for upwind state emission reductions based on air quality
modeled in a future year aligned with the Marginal area attainment
date. Rather, the EPA believes it is more appropriate and consistent
with the nonattainment planning provisions in title I to evaluate
downwind air quality and upwind state contributions, and, therefore,
the necessity for upwind state emission reductions, in a year aligned
with an area classification in connection with which downwind states
are also required to implement controls on existing sources--i.e., with
the Moderate area attainment date, rather than the Marginal one. With
respect to the 2015 ozone NAAQS, the Moderate area attainment date will
be in the summer of 2024, and the last full year of monitored ozone-
season data that will inform attainment demonstrations is, therefore,
2023.
    Even assuming that a year aligned with the Marginal area attainment
date could be an appropriate analytic year for the EPA to consider in
evaluating future air quality in Delaware, the commenters have not
submitted any information that indicates there will be an air quality
problem under the 2015 ozone NAAQS in Delaware in the Marginal
attainment-date year of 2021, nor did the petition provide any. As
discussed in Section III of this notice, the petitioner bears the
burden of establishing, as an initial matter, a technical basis for the
specific finding requested and has not done so here.
    The projected ozone design values for 2023 represent the best
available data regarding expected air quality in Delaware in a future
attainment year. These data were developed over the course of multiple
years of analytic work, reflecting extensive stakeholder feedback and
the latest emission inventory updates. The EPA assembled emissions
inventory and performed air quality analytics in 2016 and released
corresponding data and findings in a Notice of Data Availability (NODA)
in January of 2017. Subsequent to stakeholder feedback on the NODA, the
EPA was able to further update its inventories and air quality modeling
and release results for 2023 future analytic year in October 2017.
There are no comparable data available for earlier analytic years
between 2017 and 2023 that have been through an equally rigorous
analytic and stakeholder review process, and, thus, the 2023 data are
the best data available currently for the EPA to evaluate Delaware's
claims at this time.
    Commenters additionally contend that the 3-year deadline for
implementing a remedy under CAA section 126(c) suggests that the use of
2023, which is 5 years in the future, as an analytic year for purposes
of evaluating Delaware's CAA section 126(b) petitions is inappropriate.
The EPA disagrees. The EPA's evaluation of air quality in 2023 is a
necessary step to determine whether the sources named in Delaware's
petitions are in violation of the good neighbor provision, and the
choice of 2023 as an analytic year does not preclude the implementation
of a remedy in an earlier year if the necessary finding is made. While
CAA section 126 contemplates that a source or group of sources may be
found to have interstate transport impacts, it cannot be determined
whether such source or sources are in violation of the good neighbor
provision and whether controls are justified without analyzing
emissions from a range of sources influencing regional-scale ozone
transport, including sources not named in the petitions. In particular,
as discussed in Section III of this notice, the EPA evaluates air
quality in a year

when emission reductions would be expected to be implemented under the
good neighbor provision. Analysis of a future year aligned with
anticipated compliance also ensures that any emission reductions the
EPA may require under that provision are not in excess of what would be
necessary to address downwind nonattainment and maintenance problems.
The 2023 analytic year that the EPA has chosen for evaluating ozone
transport with respect to the 2015 ozone NAAQS was selected because it
aligns the downwind attainment dates and ensures that emission
reductions required by that date will not over-control upwind state
emissions because it accounts for changes in upwind state emissions and
downwind state ozone concentrations expected between now and 2023.
Additionally, even if the EPA were to determine based on 2023 as an
analytic year that the named sources are projected to be in violation
of the good neighbor provision, the EPA could still implement a remedy
that complies with the earlier timeline set out under CAA section
126(c). Therefore, the EPA's reasonable choice of 2023 as an analytic
year for evaluating Delaware's petition does not in and of itself
preclude implementation of a remedy at an earlier date.
    Commenters further assert that since Delaware's and Maryland's
requested remedies are to require already existing controls to operate
mean the EPA's justification for selecting the 2023 analytic year is
incorrect. The EPA disagrees. First, the EPA believes it is appropriate
for the EPA to consider air quality in 2023 because it is aligned with
the attainment date for the 2015 ozone NAAQS. As discussed earlier, if
there is no future air quality problem relative to this NAAQS, it would
not be appropriate for EPA to require additional upwind emission
reductions under CAA sections 110 or 126. Moreover, as discussed later
in this notice, control optimization at the identified sources has
already been addressed in the CSAPR Update, and emission reductions
associated with the proposed control technology are already being
realized. Thus, the EPA does not agree that the timeframe for
implementation of a control strategy that is already in place should
guide its selection of a future analytic year for this NAAQS.
    Rather than focusing on optimization, the selection of an
appropriate year for any additional mitigation measures necessary to
eliminate upwind contribution would have to accommodate the
corresponding technologies that could deliver incremental reductions.
Therefore, the EPA identified an appropriate future analytic year that
would allow for mitigation measures not yet considered in the CSAPR
Update for sources across the region. These are technologies that were
deemed to be infeasible to install for the 2017 ozone season. In
establishing the CSAPR Update emissions budgets, the EPA identified but
did not analyze the following two EGU NOX control strategies
in establishing the CSAPR Update emissions budgets because
implementation by 2017 was not considered feasible: (1) Installing new
SCR controls; and (2) installing new SNCR controls. For a variety of
labor, material, engineering, and grid-related considerations, the EPA
believes that 2023 would likely be an appropriate year to allow for
these mitigation measures. See 81 FR 33730 (July 17, 2018); 83 FR 31915
(July 10, 2018).
    And fourth, commenters assert that the 2023 modeling is flawed
because it relies on optimistic assumptions that EGU controls would
operate when there is no enforceable requirement for sources to do so
under the existing allowance trading program. The commenter states that
in the 2023 air quality modeling, the EPA incorrectly assumed
individual units would make emission reductions. The EPA has made both
a conceptual case as to why those reductions will be achieved through
the CSAPR Update existing allowance trading program, and an evidence-
based case that reductions based on control optimization already
achieved in 2017. Not only were the anticipated reductions realized
generally from EGUs in the upwind states identified by the petitioners,
but reductions were also made by the fleet of individual sources (on a
seasonal and daily basis) identified by the commenter. The
reasonableness and feasibility of the EPA's 2023 EGU emission
projections regarding the control-optimization reductions under a
trading program are illustrated by the first year of CSAPR Update
compliance emission levels in 2017. EGU emissions in 2017 dropped by 21
percent from 2016 levels and were seven percent below the collective
CSAPR Update budgets for the 22 affected states. The EPA's 2023
projections for the 22 states were 10 percent below the collective
CSAPR Update budgets, meaning in just one year, states have already
achieved the majority of the EGU reductions anticipated by the EPA for
2023, suggesting that sources in these states are on pace to actually
be below that level by 2023. For the five states addressed in the
petitions, ozone-season NOX EGU emissions dropped from
136,188 tons in 2016 to 92,189 tons in 2017 for EGUs greater than 25
MW. This reflects a 32 percent reduction in just one year.\53\
---------------------------------------------------------------------------

    \53\ See Engineering Analysis--Unit File. Available at ftp://ftp.epa.gov/EmisInventory/2011v6/v3platform/reports/2011en_and_2023en/.
---------------------------------------------------------------------------

    Data from 2017, the first year of ozone-season data that would be
influenced by the CSAPR Update compliance requirements, are consistent
with the EPA's assumption that the allowance trading program would
drive SCR operation on a fleet-wide level. The EPA began its
engineering analysis to project 2023 EGU emissions with 2016 monitored
and reported data. For the units with existing SCRs that were operating
below 0.10 lb/mmBtu in 2016, the EPA assumed that their operation would
remain unchanged in 2023. For the units with existing SCRs that were
operating above 0.10 lb/mmBtu in 2016 (totaling 82,321 tons of
emissions in that year), the EPA assumed that SCRs would be optimized
under a CSAPR Update scenario to 0.10 lb/mmBtu on average for 2023.
This collective 2023 emissions estimates for these latter units were,
therefore, adjusted down to 40,590 tons. In 2017, the very first year
of CSAPR Update implementation, collective emissions from these units
were 41,706 tons. This 2017 value is already very close to EPA's 2023
estimated value, and supports the EPA's assumption that these units
would optimize SCR performance at 0.10 lb/mmBtu on average.
    The EPA observes that this assumption is also reasonable for the
units identified in the petitions. When examining the group of sources
named in the petitions, the 2017 average ozone-season NOX
emission rate for SCR-controlled units was reduced by nearly half
during the first year of the program relative to 2016 and 2015 levels.
Moreover, preliminary data for the second quarter of 2018 suggest this
pattern of lower emission rates at SCR-controlled units under the CSAPR
Update is continuing.\54\ Many of the analyses provided by commenters
to suggest the group of named sources were not operating controls are
based in the 2015-2016 time-period, before the CSAPR Update was
implemented, when hourly, daily, and seasonal emissions were higher
because controls were not being consistently run at optimized levels.
Both CSAPR and the CSAPR

Update include assurance provisions that ensure that EGUs in each
covered state will be required to collectively limit their emissions.
These provisions include an assurance level for each state that serves
as a statewide emissions cap. This assurance level is the sum of the
state emission budget plus a variability limit equal to 21 percent of
the state's ozone-season budget. This means that collectively EGU
emissions in each state cannot exceed 121 percent of the state budget
level without incurring penalties. The assurance levels are designed to
help ensure each covered state in a region-wide trading program still
reduces emissions--as opposed to purely relying on allowance
purchases--from historical levels while allowing for the inherent
variability in generation and emissions from year-to-year given changes
in power sector market conditions. 76 FR 48212. These assurance levels
help ensure that the emission reductions associated with the
optimization of existing controls, on which the CSAPR Update budgets
were based, or commensurate emission reductions from elsewhere in the
state continue to be observed going forward. Therefore, even with fleet
turnover and a growing allowance bank, emissions will continue to be
limited within the state.
---------------------------------------------------------------------------

    \54\ Preliminary 2018 data reflects first two months of 2018
ozone season available at the time of finalizing this action. See
EPA's Clean Air Markets Division data, available at https://ampd.epa.gov/ampd/.
---------------------------------------------------------------------------

    Finally, the EPA also disagrees to the extent the commenter claims
that EGU emissions will increase, rather than decrease, in future years
of the CSAPR Update implementation or that the market for allowance
prices would have to price credits much higher in order to ensure that
the emission reductions associated with control optimization will
continue. This claim is not consistent with observed historical
emission patterns over successive years of an allowance trading
program's implementation. It is also not consistent with forward
looking emissions projections in power sector models.\55\ There are a
variety of policy and market forces at work beyond CSAPR allowance
prices that are anticipated to continue to drive generation to shift
from higher emitting to lower emitting sources. These include changes
such as sustained lower natural gas prices that make lower emitting
natural gas combined cycle units more economic to build and dispatch,
state energy policy and technology advancements which have made
renewable energy (e.g., solar and wind) more competitive compared to
higher emitting fossil-fuel fired generation, and the aging of the coal
fleet which is leading many companies to conclude that a significant
number of higher emitting plants are reaching the end of their useful
economic life. The EPA's experience implementing prior allowance
trading programs shows that emissions from covered sources generally
trend downwards (regardless of allowance price) as time extends further
from the initial compliance year.\56\ Both the Acid Rain Program and
CSAPR SO2 allowance banks grew in 2017 from their 2016
levels, indicating that sources are collectively adding to the bank by
emitting below state budgets rather than drawing down the bank because
of the availability of low-cost allowances. This illustrates that the
EPA's assumptions underlying its projection of 2023 ozone-season
NOX levels for EGUs are reasonable and appropriate.
---------------------------------------------------------------------------

    \55\ See results from EPA's power sector modeling platform v6.
Available at https://www.epa.gov/airmarkets/results-using-epas-power-sector-modeling-platform-v6.
    \56\ 2014 Program Progress, Clean Air Interstate Rule, Acid Rain
Program, and Former NOX Budget Trading Program. EPA.
Available at https://www.epa.gov/sites/production/files/2017-09/documents/2014_full_report.pdf.
---------------------------------------------------------------------------

b. The EPA's Step One and Two Analysis for Maryland
    With respect to steps one and two of the four-step framework for
the Maryland petition, as the state noted in its petition and as the
EPA acknowledged in the proposal, the EPA conducted an analysis in the
CSAPR Update regarding the air quality impact of anthropogenic
emissions from the five upwind states named in the state's petition on
downwind air quality in Maryland with respect to the 2008 ozone NAAQS.
In the CSAPR Update, the EPA found Maryland has a maintenance receptor
for the 2008 NAAQS (step one), and that the upwind states that Maryland
identifies in its petition are ``linked'' above the contribution
threshold of one percent of the NAAQS (step two).\57\ However, as
discussed in Section III of this notice, the conclusion that a state's
emissions met or exceeded this threshold only indicates that further
analysis is appropriate to determine whether any of the upwind state's
emissions meet the statutory criteria of significantly contributing to
nonattainment or interfering with maintenance (step three). The EPA's
independent step three analysis of the sources named in Maryland's
petition is discussed in the following sections.
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    \57\ See CSAPR Update, 81 FR 74504 (October 26, 2016). The EPA
notes that based on 2015-2017 data, Maryland's highest ozone design
value is 75 ppb at monitor ID 240251001, which is currently not
violating the 2008 ozone NAAQS. See 2017 Design Value Reports,
available at https://www.epa.gov/sites/production/files/2018-07/ozone_designvalues_20152017_final_07_24_18.xlsx.
---------------------------------------------------------------------------

    The state of Maryland submitted a comment challenging the EPA's
decision to assess Maryland's petition only for the 2008 ozone NAAQS,
asserting that the EPA failed to acknowledge that EPA's extended delay
in acting on the CAA section 126(b) petition has impacted Maryland's
designation under the 2015 ozone standard. Additionally, the comment
asserts that since Maryland has a maintenance problem for the 2008
ozone NAAQS, and the states where the petitioned units are located are
linked to that maintenance problem, applying the EPA's analysis under
the 2008 ozone NAAQS to the more stringent 2015 ozone NAAQS necessarily
demonstrates that the named sources are also linked to the same monitor
under the 2015 ozone standard.
    Maryland's petition did not allege that a source or group of
sources emit or would emit in violation of CAA section
110(a)(2)(D)(i)(I) for the 2015 ozone NAAQS, but rather merely alleged
that emissions reductions resulting from Maryland's requested remedy
could influence the 2015 ozone designations. As noted in the EPA's
proposed action on Maryland's petition, the cover letter of the
petition specifically requests that the agency make a finding ``that
the 36 electric generating units (EGUs) . . . are emitting pollutants
in violation of the provisions of Section 110(a)(2)(D)(i)(I) of the CAA
with respect to the 2008 ozone National Ambient Air Quality
Standards,'' and the petition throughout refers only to the 2008 ozone
NAAQS when identifying alleged air quality problems in Maryland and the
impacts from upwind sources. Maryland acknowledges that it did not
submit a 126(b) petition requesting a finding with respect to the 2015
ozone NAAQS. Furthermore, because the EPA's proposal focused on the
claims related to the 2008 ozone NAAQS raised in the petition, the
EPA's proposed action on the petition did not provide notice to the
public of any proposed conclusions or analysis that the public would
need to appropriately comment on any determinations with respect to the
2015 ozone NAAQS, nor did it inform the public that any action might be
taken with regard to a finding of a good neighbor violation with regard
to the 2015 ozone NAAQS under Maryland's petition. Accordingly, taking
final action on the petition in the context of the 2015 ozone NAAQS in
response to Maryland's comments cannot be construed as a logical
outgrowth of the proposal.

    Commenters further assert that it is improper for the agency to
rely on 2023 ozone modeling projections to claim that Maryland does not
have attainment problems with respect to the 2008 ozone NAAQS. This
comment misconstrues the EPA's basis for denying Maryland's petition.
Maryland's petition only requested a specific finding with respect to
the 2008 ozone NAAQS. As described earlier in this section, the EPA
determined that Maryland was projected to have a downwind air quality
concern with respect to the 2008 ozone NAAQS under step one of the
framework, and that the named upwind states are linked to Maryland in
step two based on the 2017 modeling conducted for the CSAPR Update. The
EPA did not evaluate whether Maryland has an air quality problem in
2023 in assessing its petition.
    In conclusion, under steps one and two of the transport framework,
the EPA has modeled a maintenance problem in 2017 at the Harford County
receptor for the 2008 ozone NAAQS following the implementation of the
CSAPR Update and the upwind states named in the petition are linked to
that receptor in EPA's 2017 contribution modeling. See 81 FR 74533. The
EPA concludes that it is appropriate to assess the additional steps of
the transport framework for the sources named in Maryland's petition.
This analysis is further described in this section.
3. The EPA's Step Three Analysis With Respect to EGUs Equipped With
SCRs Named in Delaware and Maryland's Petitions
    In the previous section, the EPA evaluated the petitions with
regard to steps one and two of the transport framework, and the agency
found that Delaware does not and is not expected to have a requisite
air quality problem under step one for either the 2008 or 2015 ozone
NAAQS, and, therefore, the EPA does not have a basis to impose
additional emission limitations on the named upwind sources. While the
EPA is finalizing a determination that Delaware's petitions should be
denied based on the EPA's conclusions in step one of the four-step
framework, the EPA is also evaluating the EGUs named in the Delaware
petitions in this step three analysis because we believe that
evaluation provides an additional independent basis for denial.
Regarding the Maryland petition, application of steps one and two for
the named upwind states indicated that it is appropriate to assess the
additional steps of the transport framework for the named sources.
Accordingly, this section discusses the step three analysis for the
sources named in both the Delaware petitions (as an additional basis
for denial) and the Maryland petition (as the sole basis for denial).
    Generally, the EPA's analysis in step three considers cost,
technical feasibility, and air quality factors in a multi-factor test
to determine whether any emissions from states linked to downwind air
quality problems in steps one and two will significantly contribute to
nonattainment and/or interfere with maintenance of the NAAQS, and,
therefore, must be eliminated pursuant to the good neighbor provision.
Because the CSAPR Update was recently finalized to address regional
interstate ozone pollution transport, the EPA considered its step three
analysis of the sources named in the section 126(b) petitions in light
of the existing CSAPR Update analysis and in light of additional
analysis evaluating the impact of the CSAPR Update implementation.\58\
Thus, in this section, the EPA explains how it identified and evaluated
cost and air quality factors to evaluate the named sources in a
multifactor test consistent with step three of the framework as applied
in the CSAPR Update. The crucial factors the EPA considered include
whether there are further NOX emission reductions beyond
what was already finalized in the CSAPR Update available at the
specific sources named in the petitions, the cost of any such
reductions, and the potential air quality improvements that would
result from any such reductions. The EPA first analyzes this step with
respect to those units identified in the Delaware and Maryland
petitions that are equipped with SCR. The EPA then considers two named
units that are equipped with SNCR, and finally, the one named unit that
has neither SCR nor SCNR, but that has the ability to shift its fuel
combustion to lower-emitting options.
---------------------------------------------------------------------------

    \58\ All of the EGUs named in the petitions are subject to FIPs
promulgated as part of the CSAPR Update that require EGUs in each
state, including the EGUs named in the petitions, to participate in
the CSAPR NOX Ozone Season Group 2 allowance trading
program, subject to statewide emission budgets with limited
interstate trading.
---------------------------------------------------------------------------

a. Analysis of SCR for NOX Mitigation
    Three of Delaware's petitions identify EGUs (Conemaugh, Harrison,
and Homer City) that are already equipped with SCRs, and 34 of the 36
EGUs identified in Maryland's petition are also equipped with SCRs.\59\
In establishing each state's CSAPR Update EGU NOX ozone
season emission budgets, the agency quantified the emission reductions
achievable from all NOX control strategies that were
feasible to implement within one year \60\ and cost effective at a
marginal cost of $1,400 per ton of NOX removed. This level
of NOX control stringency was established explicitly to
reflect the ability of sources in regulated states to turn on existing,
idled SCR--i.e., the operational behavior that the section 126(b)
petitions generally ask EPA to mandate. In addition to turning on and
optimizing existing idled SCR controls, this level of NOX
control stringency encompassed optimizing NOX removal by
existing, operational SCR controls; installing state-of-the-art
NOX combustion controls; and shifting generation to existing
units with lower NOX emission rates within the same state.
81 FR 74541. Thus, the CSAPR Update emission budgets already reflect
emission reductions associated with turning on and optimizing existing
SCR controls across the 22 CSAPR Update states, including at the EGUs
that are the subject of the Maryland and Delaware petitions. This is
the same control strategy identified in the petitions as being both
feasible and cost effective. The EPA is determining that, as a result
of the CSAPR Update, all identified cost-effective emission reductions
have already been implemented for the 2008 ozone NAAQS with respect to
the sources named in the Delaware and Maryland petitions that are
already equipped with SCR.
---------------------------------------------------------------------------

    \59\ These facilities are located in Indiana (Alcoa Allowance
Management Inc., Clifty Creek, Gibson, IPL--Petersburg Generating
Station), Kentucky (East Bend Station, Elmer Smith Station,
Tennessee Valley Authority Paradise Fossil Plant), Ohio (Killen
Station, Kyger Creek, W. H. Zimmer Generating Station), Pennsylvania
(Bruce Mansfield, Cheswick, Homer City, Keystone, Montour), and West
Virginia (Harrison Power Station, Pleasants Power Station).
    \60\ The CSAPR Update was signed on September 7, 2016--
approximately 8 months before the beginning of the 2017 ozone season
on May 1.
---------------------------------------------------------------------------

    Delaware and Maryland's petitions contend that, based on data
available at the time the petitions were filed, the named sources are
operating their NOX emissions controls at low efficiency
levels, or are not operating them at all at certain times. Delaware and
Maryland, therefore, ask the EPA to impose unit-specific 30-day
emission rate limits or other requirements to ensure the controls will
be continually operated. The EPA acknowledges that in years prior to
implementation of the CSAPR Update in 2017, the named sources may have
operated as petitioners describe. However, implementation of the
emission budgets promulgated in the CSAPR Update represents the most
recent data regarding these EGUs' operations. In the years before 2017,
the EPA observed

similar emissions behavior for a substantial number of EGUs across the
eastern United States (i.e., this was not limited to just the named
sources here) and suspected that the additional emissions resulting
from the inefficient operation of controls were detrimentally affecting
air quality for a substantial number of areas. Consequently, through a
notice-and-comment rulemaking and after evaluating and responding to
numerous stakeholder comments, the EPA finalized the CSAPR Update. That
rulemaking found EGUs in the named states had emissions that could be
cost effectively eliminated in order to address interstate ozone
transport under the good neighbor provision. Therefore, the EPA imposed
limits on statewide EGU emissions commensurate with running optimized
SCR controls (and certain other control strategies). These emission
reductions resulted in substantial modeled improvements in air quality
throughout the region and had substantial benefits for the specific
downwind areas identified in the petitions.
    The EPA received several comments suggesting that emissions data
indicate that the EPA's determination that the CSAPR Update would
address interstate transport from these sources is flawed. Accordingly,
the EPA has evaluated emissions data across the CSAPR Update region,
including from the states and sources named in the petitions. As
further described later, the EPA's analysis of such data demonstrates
that, following implementation of the CSAPR Update, EGUs in the CSAPR
Update regional generally and the named EGUs specifically have in fact
achieved emission reductions commensurate with the operation of
existing SCRs. Consequently, the EPA finds that CSAPR Update
implementation is generally achieving the NOX reductions
identified in the section 126(b) petitions for mitigation at these
sources. The EPA, therefore, determines that these sources neither emit
nor would emit in violation of the good neighbor provision.
    The EPA determines that this conclusion is appropriate with regard
to the claims raised under the 2008 ozone NAAQS in both states'
petitions. Moreover, because the cost-effective strategy of optimizing
existing controls relative to the 2008 ozone NAAQS has already been
implemented via the CSAPR Update for the sources Delaware named for its
claims regarding the 2015 NAAQS, the EPA also determines there are no
additional cost-effective control strategies available to further
reduce NOX emissions at these sources to address that most
recent standard.
(1) Current Emissions Data Show NOX Reductions Under the
CSAPR Update
    Based on observed emissions levels and emission rates in 2017,
implementation of the CSAPR Update has resulted in actual emissions
reductions at the named sources and/or commensurate reductions at other
sources in the same state, both seasonally and on a daily basis. In
other words, because the strategy of optimizing existing controls has
already been implemented for these sources through the CSAPR Update,
there is no information suggesting there are additional control
strategies available to further reduce NOX emissions at
these sources to address for the 2008 ozone-NAAQS.
(a) Seasonal Reductions Under the CSAPR Update
    The recent historical observed and reported data regarding
emissions from the sources named in the petitions, and the states they
are located in, illustrate the effectiveness of the EPA's allowance
trading approach to reducing NOX emissions. While much of
the data presented in the petitions focused on emissions and emission
rates prior to 2017, the 2017 ozone-season data illustrates that,
during the first year of the CSAPR Update Rule: (1) The average
emission rate improved nearly 50 percent on average at the 34 units
identified in the petitions as having SCR controls, (2) EGU emissions
declined by 46 percent at these 34 units, and (3) EGU emissions
declined by 32 percent collectively in the states where these
facilities are located.

                Table 1--Ozone-Season NOX Emission Rates and Emissions Pre- and Post-CSAPR Update
----------------------------------------------------------------------------------------------------------------
                                                                       2015            2016            2017
----------------------------------------------------------------------------------------------------------------
Average Ozone-Season Emission rate from 34 identified units (lb/           0.254           0.200           0.115
 mmBtu).........................................................
Total Emissions from 34 identified units (tons).................          55,443          46,023          24,894
Total Emissions from states named in the petitions (tons)*......         154,413         136,188          92,189
----------------------------------------------------------------------------------------------------------------
* IN, KY, OH, PA, and WV.

    Table 1 shows the average emission rate across the 34 units, the
total seasonal emissions from these units, and the total seasonal
emissions from all units greater than 25 MW in the indicated states.
These data illustrate that, in 2017, the control optimization and the
emission reductions anticipated from the CSAPR Update are being
realized from the 34 units with SCR controls. Moreover, the EPA
examined control operation behavior at these units on a more granular
basis and determined that these operating patterns prevailed on a
smaller time scale as well. The EPA looked at the average daily
emission rate and emissions from this group of 34 sources with SCR
controls for 2015, 2016, and 2017 ozone seasons. The time-series
figures in the docket for this action show that 2017 daily ozone values
were significantly lower on both metrics relative to 2015 and 2016.\61\
This finding supports the EPA's contention that no further regulatory
actions are necessary to ensure emission reductions consistent with
operation of these controls at this time.
---------------------------------------------------------------------------

    \61\ The EPA has examined emission rate and tonnage reduction
from the petitioner-identified sources with SCR-optimization
potential prevails on a daily basis in addition to a seasonal basis
and added them to the docket for this action. See Daily
NOX Emissions Rates for Identified SCR-Controlled Sources
for Each Day of the Ozone-Season. Available in the docket for this
action.
---------------------------------------------------------------------------

    The fact that these particular sources are mitigating emissions
using the same technology and for the same standard identified in the
petitions is not the sole fact on which EPA bases its determination
that the measures adopted in the CSAPR Update have addressed reduction
potential from these sources. Because the EPA implemented those
reductions requirements though a limited trading program with state
emission caps, it is also possible that some of the emission reductions
corresponding to this identified mitigation measure are realized
elsewhere in the state and have a similar beneficial impact on downwind
air quality within the petitioning states. The EPA recognizes that a
regional trading program with embedded state emission caps provides the
flexibility to achieve emission reductions either at the sources
through the identified mitigation measures or at

sources elsewhere in the state but disagrees with the petitioners'
notion that this undermines the ability of the program to achieve
meaningful emissions reductions from particular sources. The latest and
best available data demonstrate that reductions are occurring at those
sources. Moreover, even in the event of any single-unit variation in
performance, the overall reductions are occurring within the same
airshed due to the fact that state budgets and assurance levels were
set to ensure those reduction levels statewide and regionwide. Thus,
the design of the CSAPR Update accommodates emissions reductions based
on unit-specific control optimization and observed data affirm its
success at realizing this end.
    In evaluating these petitions, the EPA analyzed ozone-season
emission rates from all coal-fired units in the contiguous U.S.
equipped with SCR and found that, based on 2017 emissions data
reflecting implementation of the CSAPR Update, 261 of 274 units had
ozone-season emission rates below 0.20 lb/mmBtu, indicating they were
likely operating their post-combustion controls through most of the
ozone season, including every unit with SCR named in Delaware's and
Maryland's petitions.\62\ On average, the 274 units were operating at
an average emission rate of approximately 0.088 lb/mmBtu. Nine of the
13 units with 2017 emission rates above 0.20 lb/mmBtu are not located
in the states where petitioners identified sources.\63\ Of the
remaining four, one retired in 2018, and the other three have
preliminary 2018 ozone season data (for reported months of May and
June) below 0.20 lb/mmBtu. Consequently, the EPA finds that on average,
SCR-controlled units are operating their SCRs throughout the season
when operating conditions make it feasible, and that the petitioner's
assertion of the likelihood of not operating controls is not borne out
in the most recently available data.
---------------------------------------------------------------------------

    \62\ As described in the CSAPR Update, optimized operation of
combustion controls and SCR typically results in NOX
emission rates of 0.10 lb/mmBtu or below. Combustion controls alone
typically result in rates down to 0.20 lb/mmBtu but can at times
achieve results in the range of 0.14 lb/mmBtu. Therefore, units
equipped with SCR that have emission rates above 0.20 lb/mmBtu are
likely not significantly utilizing their SCR. The optimized rate for
any particular unit depends on the unit-specific characteristics,
such as boiler configuration, burner type and configuration, fuel
type, capacity factor, and control characteristics such as the age,
type, and number of layers of catalyst and reagent concentration and
type.
    \63\ See Discussion of Short-term Emission Limits Final Rule,
available in the docket for this action.
---------------------------------------------------------------------------

    The CSAPR Update regional trading program has resulted in an
approximately 50 percent improvement in emission rate performance at
SCR-controlled units at the sources named in these petitions. The
statewide EGU emissions limits help make those reductions permanent
within the state and region. Therefore, the EPA has addressed upwind
emission reductions commensurate with SCR optimization in the ozone
season from the named sources.
    Commenters state that the EPA's use of a fleet-wide average to
demonstrate operation of SCRs at these units inappropriately ignores
the ability of the named sources to achieve better emission rates.
However, in the CSAPR Update, the EPA determined that, based on an
aggregation of unit-level emission rates, an average fleet-wide rate
emission rate of 0.10 lb/mmbtu would represent the optimized operation
of SCR controls that were not at that time being operated or optimized.
81 FR 74543. In concluding that this rate would be appropriate for
calculating emission reduction potential from implementation of this
control strategy, the EPA recognized that some units would have
optimized rates above that level and some below that level (consistent
with the petitioner's own comments and analysis). Therefore, in using a
fleet-wide average for setting regional and state emission limits, the
EPA considered and relied on unit-level data. Nevertheless, the 0.10
lb/mmBtu emission rate used to reflect control optimization for the
2008 ozone NAAQS for the identified sources in the CSAPR Update was not
reopened for comment in this action.
(b) Daily Reductions Under the CSAPR Update
    Commenters disagree with the EPA's conclusion that data
demonstrating that SCRs are being operated in the upwind states and at
the named sources seasonally is representative of implementation of
cost-effective controls. It is the commenter's position that for
existing controls to be cost effective, they must be maintained and
operated in accordance with good pollution control practices whenever
feasible. Commenters assert that if shorter-term NOX
emission rate data are evaluated, the SCR controls do not appear to
have been operated in accordance with good pollution control practices
at all times the units were operating.
    The petitions have alleged that short-term limits are necessary to
prevent units from turning controls off intermittently on days with
high ozone in order to harvest additional power that would otherwise be
used for control operation. As described at proposal, the EPA examined
the hourly NOX emissions data reported to the EPA and did
not observe many instances of units selectively turning down or turning
off their emission control equipment during hours with high
generation.\64\ SCR-controlled units generally operated with lower
emission rates during high generation hours, suggesting SCRs generally
were in better operating condition--not worse, let alone idling--during
those days/hours. In other words, the EPA compared NOX rates
for EGUs for hours with high energy demand and compared them with
seasonal average NOX rates and found very little difference.
Thus, the data do not support the notion that units are reducing SCR
operation on high demand days. Moreover, the auxiliary power used for
control operation is small--typically less than one percent of the
generation at the facility--and it is, therefore, unlikely that sources
would cease operation of controls for such a limited energy savings.
Instead, the data indicate that increases in total emissions on days
with high generation are generally the result of additional units that
do not normally operate coming online to satisfy increased energy
demand and units that do regularly operate increasing hourly
utilization, rather than reduced functioning of control equipment. The
EPA notes that if, in fact, the emission reductions expected from the
operation of control equipment at these facilities were no longer being
realized in the future, this final action denying Delaware's and
Maryland's petitions would not preclude either state from submitting
another CAA section 126(b) petition for these sources raising new
information not already considered herein. The EPA is not, however,
pre-determining what action may be appropriate on any such future
petition.
---------------------------------------------------------------------------

    \64\ Id.
---------------------------------------------------------------------------

    Commenters have observed that individual units equipped with SCR
have operated in 2017 ozone season with rates higher than 0.2 lb/mmBtu
on select days, suggesting that their SCR controls have been idled. The
commenters identified the number of days this occurred at individual
units (one unit at Homer City had the highest frequency of 15 days out
of the 153-day ozone season, one unit at Harrison had two days, and
Conemaugh had no days) and acknowledged that there may be engineering
reasons for units to decrease or cease operation of controls on
individual days (e.g., to avoid damaging or plugging of the SCR or
taking a forced outage where a breakdown leaves the

unit unavailable to produce power). The EPA also observes that there
appear to be engineering limitations to operating SCR at low hourly
utilization rates (e.g., at hourly capacity factors below about 25
percent, the EPA has observed limited operation of SCRs).\65\ While
Maryland acknowledges these engineering challenges to SCR performance
in low capacity factor conditions, it is not clear how the suggested
monthly unit-specific emission rate would accommodate those challenges.
In particular, ozone season capacity factors (which reflect the actual
output relative to potential output) have decreased over time, dropping
from a heat-input weighted capacity factor of 77 percent in 2006 to a
value of 67 percent in 2017, suggesting that units may spend fewer
hours operating at the high hourly utilization factors associated with
the most-efficient SCR operation and lowest emission rates.\66\ In
addition, units are now operating more frequently at hourly utilization
rates at or below 40 percent in 2017 compared to 2006.
---------------------------------------------------------------------------

    \65\ Hourly utilization factor is defined here as the ratio of
the hourly heat input to the maximum rated hourly heat input rate.
See Discussion of Short-term Emissions Limits Final Rule, available
in the docket for this action.
    \66\ The EPA selected 2006 because a commenter identified 2006
as the best year of operation for a number of units and 2005 did not
appear to have as comprehensive a data set.
---------------------------------------------------------------------------

    An individual unit may have high emissions from idling an SCR or
SNCR or for burning coal (rather than natural gas) on a specific hour
or day in the 2017 ozone season, or that the absence of daily emission
limits leaves open the possibility that a unit at the facility may have
high emissions on days that Maryland or Delaware monitors record ozone
exceedances. However, in the context of regional ozone pollution, the
EPA has concludes that reducing NOX emissions regionally and
seasonally while allowing flexibility in compliance is effective at
reducing downwind peak ozone concentrations. Because of the regional
nature of interstate ozone transport, in which emissions are
transported hundreds of miles over the course of hours or days, the EPA
has focused on reducing aggregate NOX emissions, an approach
that has successfully led to reductions in ozone concentrations across
the east coast. As such, an emission event in one hour or on one day at
a particular unit is not sufficient to suggest that the source is not
adequately controlled over the course of the ozone season.
    Petitioners and commenters asserted that that additional emission
reductions are achievable (comparing the methodology and rates put
forward by with what would be expected and/or realized under the CSAPR
Update) and that these emission reductions would be cost effective.
    Commenters assert that the maximum 30-day emission rates requested
in Maryland's petition are (1) representative of well-run controls, (2)
flexible to allow for multiple operating conditions and even sub-
optimal operation of controls on some days, and (3) consistently
achievable based on the units' own reported emissions data that
indicates the units achieved this emission rate 123 times out of 123
attempts in their past-best ozone season. However, these assertions are
flawed because the commenters' assessment included historical data
that, through notice-and-comment rulemaking in the CSAPR Update, EPA
determined were not representative of current or future operating
conditions given SCR component degradation and maintenance schedules
and changes in unit operation (i.e., to lower capacity factors). For
example, EPA's analysis of historical SCR performance in the CSAPR
Update evolved through comments on the proposal, ultimately evaluating
data from 2009 through 2015 because in this time period SCR controls
were operated year-round starting in the first compliance period for
the CAIR NOX annual program (and subsequently CSAPR
NOX annual programs) rather than only seasonally as was done
in years before 2009.\67\ Further, the petitioners and commenters
assert that the agency can apply historical SCR operating data to the
future in a manner that is at odds with the EPA's conclusions reached
through notice-and-comment in the CSAPR Update. For example,
petitioners and commenters assert that the agency can consider data
from the year of each unit's lowest historical average NOX
rate. In the CSAPR Update, the agency took comment on the
representativeness of historical data in terms of future ongoing
achievable NOX rates. Stakeholder comment led the EPA to
ultimately to focus on the third lowest ozone season rate from 2009
through 2015 to ensure that its selected rates represented efficient
but routine SCR operation (i.e., when the performance of the SCR was
not simply the result of being new, or having a highly aggressive
catalyst replacement schedule, but was the result of being well-
maintained and well-run). These topics are as described further in the
CSAPR Update RTC. Thus, the petitioners and commenters rely on
inadequate arguments, based in part on analyzing unit behaviors over an
inappropriate time-period and by overstating the potential
NOX reductions achievable at the sources. Considering the
information received and EPA's assessment thereof, the EPA has not
received sufficient information that necessitates updating or otherwise
changing the agency's position with respect to the EPA's previous
findings regarding cost-effective reductions at SCRs.
---------------------------------------------------------------------------

    \67\ The EPA's analysis of SCR NOX rates for the
final CSAPR Update differed from the proposal. The evaluation
focused on a more recent timeframe for analysis: 2009 through 2015,
compared to 2003 through 2014. The EPA believed this change was
reasonable because there were significant shifts in the power sector
since 2003, particularly with respect to power sector economics
(e.g., lower natural gas prices in response to shale gas
development) and environmental regulations (e.g., CAIR and CSAPR).
Because of these changes, the EPA considers it reasonable to
evaluate SCR performance focusing on more recent historical data
that better represent the current landscape of considerations
affecting the power sector. The EPA chose 2009 because that is the
first year of CAIR NOX annual compliance. For further
discussion, see page 522 of EPA's Response to Comments on the CSAPR
Update available in the docket for that rule at EPA-HQ-OAR-2015-
0500-0572 and EPA's EGU NOX Mitigation Strategies Final
Rule TSD available in the docket for that rule at EPA-HQ-OAR-2015-
0500-0554.
---------------------------------------------------------------------------

    In addition, to the extent that commenters argue that the emission
levels assumed for these units in the CSAPR Update (or alternatively as
measured in 2017) are marginally higher than what commenters claim
would be readily achievable, the air quality impacts of these
differences on the design value are likely to be small. Specifically,
Maryland indicates that the state anticipates an air quality benefit of
0.656 ppb attributable to the named units going from idled controls to
Maryland's definition of ``optimized'' control operation. This is
comparable to the estimated improvement in the CSAPR Update from the
engineering base case to the control case of $1,400/ton, wherein the
EPA estimated a 0.6 ppb improvement in air quality at the for Harford,
Maryland receptor.\68\ Subtracting the improvement estimated by the
commenter from the value estimated by the EPA yields a marginal
difference of 0.056 ppb.\69\ Thus, the petitions do not provide system-
wide impacts analysis showing that their requested unit-specific rate
requirements, which would reduce sources' emissions only slightly below
already achieved levels, would result in

regional reductions and air quality improvements as related to the
EPA's analysis regarding the good neighbor provision.
---------------------------------------------------------------------------

    \68\ See CSAPR Update Final Ozone AQAT ``Summary DVs'' tab,
comparing cell L12 and O12 (along with cell O28).
    \69\ While there are differences in modeling platforms, emission
totals, and temporalization of the emissions within the modeling
platforms that would affect this comparison, this provides some
estimate of the difference.
---------------------------------------------------------------------------

(2) Reliance on Allowance Trading To Address Section 126(b) Petitions
    One commenter asserts that evaluating Maryland's CAA section 126(b)
petition for control for a specific source by relying on an average
fleet-wide rate without any consideration of the emission rate that
specific source is capable of achieving undermines the intent of
section 126(b) of the CAA, which gives a state the authority to ask the
EPA to set emissions limits for specific sources of air pollution.
    As described earlier, while CAA section 126(b) addresses the same
substantive prohibition as CAA section 110(a)(2)(D)(i), CAA section
126(b) provides an independent process for downwind states to address
interstate transport. Commenters state that whether a specific source
emits or would emit in violation of the good neighbor provision is
primarily a factual determination based on monitored data and modeling,
not a legal conclusion based on whether a source is meeting an
emissions budget under a SIP or FIP.
    The EPA disagrees with those commenters that argue that the EPA can
only consider unit-level emission rates when evaluating CAA section
126(b) petitions and must ignore prior actions and reductions
addressing interstate transport that pertain to the same NAAQS, the
same mitigation measures, and the same units. If the EPA has already
identified, mandated, and received commensurate emission reductions
from those sources (or sources in a shared geographic region determined
to be equally relevant to the downwind monitor) based on control
optimization through a trading program, then ignoring that related
action could lead to miscounting emission reductions from a mitigation
technology for a given NAAQS. While the EPA does not disagree that
these types of considerations need to be revisited when evaluating
potential reductions to meet future updated NAAQS (just as they have
been revisited in previous updates to the NAAQS) for which SIPs and
FIPs have yet to be promulgated (e.g., the 2015 ozone NAAQS), the
agency disagrees that they are irrelevant considerations for other
actions related to upwind contribution for the 2008 NAAQS for which
actions have been promulgated.
    According to commenters, evaluating Delaware's and Maryland's
section 126(b) petitions based on whether the named sources participate
in a trading program is a strained interpretation of section 126(b)
because it fails to account for CAA section 126(c)'s reference to
source-specific remedies, including emissions limitations. The EPA's
position on why it is appropriate to evaluate a CAA section 126(b)
under the four-step framework and CSAPR Update is described in Section
III of this notice. Additionally, the EPA disagrees with commenters
that taking account of compliance with an emissions budget as part of
an analysis of a CAA section 126(b) petition is inconsistent with the
nature of CAA section 126(c)'s specific alternative remedies. Under CAA
section 302(k), an ``emission limitation'' is ``a requirement that
limits the quantity, rate, or concentration of emission of air
pollutants on a continuous basis.'' Under an allowance trading program,
the Administrator sets an emission limitation for a defined region or
regions and a compliance schedule for each unit subject to the program
in that region. The emission limitation for each unit is the federally
enforceable requirement that the quantity of the unit's emissions
during a specified period cannot legally exceed the amount authorized
by the allowances that the unit holds. The compliance schedule is set
by establishing a deadline by which units must begin to comply with the
requirement to hold allowances sufficient to cover emissions. Because
an allowance trading program is a compliance mechanism that enables
sources to make cost-effective decisions to meet their allowance
requirements, which are, in essence, emission limits, the EPA believes
considering compliance with such a program as part of its analysis of a
CAA section 126(b) petition is in fact consistent with the forms of
remedy authorized under CAA section 126(c).
    Additionally, the EPA has previously relied on regional allowance
trading programs intended to implement CAA section 110(a)(2)(D)(i)(I)
to also address section 126(b) petitions. The EPA first used a regional
trading program as a section 126(c) remedy for findings in response to
section 126(b) petitions from eight states requesting upwind sources be
regulated with respect to the 1979 ozone NAAQS. Based on findings made
through the NOX SIP call, the EPA established its Federal
NOX Budget Trading Program in response to these petitions.
65 FR 2674 (Jan. 18, 2000). The use of the regional analysis of ozone
transport in the NOX SIP call findings to respond to
contemporaneous section 126(b) petitions was challenged in the D.C.
Circuit in Appalachian Power, where Petitioners argued that findings
based on statewide emissions cannot determine whether specific
stationary source emissions are in violation of the good neighbor
provision. Petitioners argued that instead of relying on the
NOX SIP call findings, the EPA needed first to make the more
rigorous finding that the specified stationary sources within a given
state independently met its threshold test for impacts on downwind
areas. Given the linkage between section 126(b) and the good neighbor
provision, the court determined it was reasonable for the EPA to tie
its source-specific findings under section 126(b) to the significance
of a state's total NOX emissions as determined under section
110(a)(2)(D)(i). 249 F.3d at 1049-1050. While the court did not
explicitly speak to the issue of whether an allowance trading program
is an appropriate remedy under CAA section 126(c), the court's
conclusion that a regional analysis is appropriate to evaluate ozone
transport at individual sources also supports the conclusion that a
regional remedy can effectively address the any air quality problem
identified through such an analysis. The court ultimately upheld the
EPA's regulatory action on the section CAA 126(b) petitions, which
included reliance on the allowance trading program.
    The EPA evaluated whether there is newly available information that
leads to a determination that these sources are inadequately controlled
by the CSAPR Update, as commenters assert. The petitioners and
commenters claim that this is so, based on data that preceded
implementation of the CSAPR Update that they assert illustrates that
relatively large sources with existing control equipment were not
operating at appropriate levels of NOX abatement. The
petitioners and commenters further assert that these sources are
inadequately controlled because they do not always operate control
equipment on high ozone days. They support their argument with an
analysis of an allegedly achievable NOX rate, which they
claim is appropriate for regulatory application.
    The EPA does not agree that these assertions support a
determination that these sources are inadequately controlled by the
CSAPR Update, and that additional regulatory measures for these sources
are necessary under the good neighbor provision. Not only was that rule
specifically designed to achieve the reductions necessary under the
good neighbor provision, but recent data indicate that it is in fact
achieving such reductions and that petitioners' assertions are not
borne out by the

current or future operations of the named sources. As discussed
earlier, based on reported 2017 ozone-season emissions under the first
CSAPR Update compliance period, these sources as a group effectively
reduced emissions to a degree consistent with the CSAPR Update remedy.
Commenters provided no compelling additional recent emissions and air
quality data that suggest controls were broadly underperforming on high
ozone days.
    The EPA notes that the power sector is a complex and interconnected
system in which factors affecting one facility can result in effects
across facilities within the state or dispatch region. Thus, granting
the petitioners' request for source-specific emission limitations at
certain EGUs could cause effects at other EGUs. For instance, rate
requirements could result in generation shifting to higher-emitting
units that were not named in the petition, potentially creating worse
downwind air quality impacts on a statewide or regionwide basis.
Petitioners fail to recognize or account for potential re-balancing
across the power sector in response to their requested remedy. By only
examining the impact of a subset of the units subject to the same cap,
the petitioner does not fully account for the potential air quality
impact from implementation of the proposed remedy.
    The EPA received comments on the proposed action asserting that an
allowance trading program, such as that promulgated in the CSAPR
Update, cannot address significant contribution to nonattainment or
interference with maintenance from a source or group of sources under
CAA section 126. Commenters state that an allowance trading program is
insufficient to constrain NOX emissions where there are
excess allowances. Commenters state that since ozone is observed on a
daily basis and the form of the standard is based on daily
observations, daily NOX limits are necessary to prevent
units from emitting at high rates on exceedance days and the days
leading up to the exceedance. The EPA does not agree that an allowance
trading program is an inadequate means of implementing emission
reductions for interstate transport purposes and notes it has done so
in response to CAA section 126(b) petitions previously.\70\ Petitioners
have not provided compelling new or novel information regarding the
EPA's technical analysis of NOX control potential or
observation of CSAPR Update implementation. Implementation mechanisms
based on seasonal NOX requirements have demonstrated success
at reducing peak ozone concentrations. For example, over the past
decade, there has been significant improvement in ozone across the
eastern United States, in part due to season-long allowance trading
programs such as the NOX Budget Trading Program, CAIR, and
the CSAPR NOX ozone-season allowance trading program. As a
result, current measured air quality in all Eastern areas is below the
1997 ozone NAAQS. As such, based on the best information available to
the agency at this time, the EPA believes that its current approach of
implementing an allowance trading program at step four has proven
effective at constraining NOX emissions from covered
sources, including the sources named in the petitions.
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    \70\ See Rulemaking on Section 126 Petition From North Carolina
To Reduce Interstate Transport of Fine Particulate Matter and Ozone;
Federal Implementation Plans to Reduce Interstate Transport of Fine
Particulate Matter and Ozone; Revisions to the Clean Air Interstate
Rule; Revisions to the Acid Rain Program, 71 FR 25328 (April 28,
2006); Findings of Significant Contribution and Rulemaking on
Section 126 Petitions for Purposes of Reducing Interstate Ozone
Transport, 65 FR 2674 (January 18, 2000).
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b. Analysis of SNCR for NOX Mitigation
    In its petition, Maryland also alleges that two facilities
operating SNCR post-combustion controls--Cambria Cogen in Pennsylvania
and Grant Town Power Plant in West Virginia--emit or would emit in
violation of the good neighbor provision with respect to the 2008 ozone
NAAQS and asks that the agency impose emission limits or other
requirements to ensure that the facilities operate their SNCR during
the ozone season. The EPA is finalizing its proposal to deny Maryland's
petition with respect to sources operating SNCR based on its conclusion
that fully operating with SNCR is not a cost-effective NOX
emissions reduction strategy for these sources, considering other
relevant factors such as NOX reduction potential and
downwind air quality impact, with respect to addressing transport
obligations for the 2008 ozone NAAQS. The EPA determined in the CSAPR
Update that operating existing SNCR would be $3,400 per ton, which
exceeded the level that the EPA determined would be cost effective for
the good neighbor provision for the 2008 ozone NAAQS, and, therefore,
the EPA is determining in this action that these sources do not emit
and would not emit in violation of the good neighbor provision with
respect to that NAAQS.
    As discussed in Section IV.C.2 of the proposal, the EPA evaluated
control strategies in the CSAPR Update that were considered feasible to
implement by the 2017 ozone season and determined that EGU control
strategies available at a marginal cost of $1,400 per ton of
NOX reduced were cost effective, using a multi-factor test
that considered cost, NOX reduction potential, and downwind
air quality improvements at various levels of potential NOX
control stringency. In its evaluation, the EPA examined control
strategies available at different cost thresholds, including turning on
existing idled SNCR, which is the remedy proposed by Maryland in its
petition for these two units. The EPA identified a marginal cost of
$3,400 per ton as the level of uniform control stringency that
represents turning on idled SNCR controls.\71\ The EPA identified this
higher marginal cost of operating SNCR at units in the CSAPR Update
region, relative to operation of SCR, predominately based on the cost
and quantity of reagent needed (i.e., SNCRs require substantially more
reagent compared with SCRs due to the absence of catalyst which greatly
facilitates the reactions converting the NOX).
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    \71\ See EGU NOX Mitigation Strategies Final Rule TSD
(docket ID EPA-HQ-OAR-2015-0500-0554), available at http://www.regulations.gov.
---------------------------------------------------------------------------

    The CSAPR Update finalized emission budgets using $1,400 per ton
control stringency, finding within step three of the transport
framework that this level of stringency represented the control level
at which incremental EGU NOX reductions and corresponding
downwind ozone air quality improvements were maximized with respect to
marginal cost. In finding that use of the $1,400 per ton control cost
level was appropriate for the 2008 ozone NAAQS, the EPA determined that
the more stringent emission budget level reflecting $3,400 per ton
(representing turning on idled SNCR controls) yielded fewer additional
emission reductions and fewer air quality improvements per additional
dollar of control costs.
    Based on the information, assumptions, and analysis in the CSAPR
Update, the EPA determined that establishing emission budgets at $3,400
per ton and developing associated emissions budgets based on operation
of idled SNCR controls was not cost effective for addressing good
neighbor provision obligations for the 2008 ozone NAAQS because this
level of control yielded fewer additional emission reductions and fewer
air quality improvements relative to other less-costly control
strategies. 81 FR 74550. A review of the emission levels at the

sources named in Maryland's petition before implementation of the CSAPR
Update, in particular, demonstrates that the two units are relatively
small in size and have low emission levels, indicating that the units
have a relatively limited ability to substantially reduce
NOX emissions and, thereby, improve air quality
downwind.\72\ Neither Maryland's petition nor public commenters provide
any contradictory information demonstrating that fully operating SNCR
is a cost-effective control for the two named sources, considering the
marginal cost of implementation, the anticipated emission reduction,
and the potential air quality benefits.\73\ The EPA, thus, denies
Maryland's petition with respect to these sources based on its
conclusion that fully operating with SNCR is not a cost-effective
NOX emission reduction strategy with respect to addressing
transport obligations for the 2008 ozone NAAQS for these sources, and,
therefore, that these sources do not emit and would not emit in
violation of the good neighbor provision with respect to the 2008 ozone
NAAQS.
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    \72\ Cambria Cogen units one and two emitted 237 tons and 219
tons of ozone season NOX in 2016, respectively, while
Grant Town units 1A and 1B emitted 282 tons and 285 tons of ozone
season NOX in 2016, respectively. Ozone season
NOX emissions rates from these EGUs under the CSAPR
Update in 2017 are described later.
    \73\ Since the EPA does not agree, and Maryland has not
demonstrated in the first instance that the operation of SNCR at
these units is cost effective, the EPA need not address Maryland's
claim that short-term emission limits may be appropriate. In any
event, the EPA notes that the same concerns with relying on the
lowest historical emission rate for purposes of determining what is
achievable for SCRs, discussed in Section IV.B.2 in the proposal,
would also apply to Maryland's contentions with respect to SNCRs.
---------------------------------------------------------------------------

    While the EPA determined that fully operating SNCR across the
region was not cost effective with respect to addressing transport
obligations for the 2008 ozone NAAQS, individual sources may
nonetheless choose how to comply with the CSAPR ozone season
NOX allowance trading program. The operation of existing
SNCR controls is one method to achieve emission reductions needed to
comply with the requirements of the trading program. 81 FR 74561. For
instance, during the 2017 ozone season, likely in part as the result of
economic incentives under the CSAPR Update, the two Cambria units with
SNCR appear to have operated their controls, resulting in average
NOX emissions rates of 0.15 and 0.16 lbs/mmBtu, respectively
(a drop from the 2016 rates of 0.23 and 0.24 lbs/mmBtu,
respectively).\74\
---------------------------------------------------------------------------

    \74\ See 2015, 2016, and 2017 Ozone-Season NOX rates
(lbs/mmBtu) for 41 units named in the petitions, available in the
docket for this action.
---------------------------------------------------------------------------

    One commenter asserts that the EPA incorrectly analyzed Maryland's
argument related to EGUs equipped with SNCR, as the availability of
NOX reductions under a 126(b) petition must be evaluated on
a source-specific basis in order to determine if the proposed
NOX control is cost effective. The commenter alleges that
when the EPA conducts cost-effectiveness determinations for RACT, SNCR
installation is considered cost effective, and, therefore that running
those installed controls is necessarily also cost effective in the
context of the good neighbor provision as well. Another commenter
asserts that the optimization of existing post-combustion controls is
an immediately available cost-effective NOX reduction
strategy available in the EGU sector.
    While the operation of SNCR could be implemented relatively
quickly, as described earlier, the EPA does not have a basis to
determine that the controls are cost effective at these units when
considering cost, NOX reduction potential, and downwind air
quality improvements. Commenters have also not provided information
demonstrating that, even at the unit level proposed by the commenter,
operation of SNCR at the two units named in the Maryland petition are
cost effective relative to NOX reduction potential and
downwind air quality improvements.
    The EPA also does not agree that any conclusions drawn regarding
cost effectiveness of controls in other contexts are directly
applicable here. RACT determinations are evaluating whether
implementation of certain controls within a nonattainment area will be
effective at addressing a local air quality problem relative to the
cost of implementing such controls. However, implementation of the same
controls at sources that are significantly farther from a particular
air quality problem may have very different air quality impacts a
downwind area. As described earlier in this notice, ozone transport is
the result of the collective contribution of many sources in several
upwind states. The relative cost effectiveness of emission reductions
from implementation of controls at a given upwind source, when
considering NOX reduction potential and downwind impacts,
will necessarily be different than evaluation of the same controls at a
more local source. The EPA's approach for assessing cost effectiveness
in the context of regional interstate ozone pollution transport can,
therefore, reasonably be considered as addressing a different air
quality concern and thereby independent from cost-effectiveness
determinations made under RACT.
    Based on the EPA's conclusion that fully operating with SNCR is not
a cost-effective NOX emission reduction strategy with
respect to addressing transport obligations for the 2008 ozone NAAQS
for these sources, the EPA finds that the petition and the comments
provide no grounds for the EPA to determine that that the two sources
identified as operating SNCR emit or would emit in violation of the
good neighbor provision with respect to the 2008 ozone NAAQS.
c. The EPA's Step Three Analysis With Respect to Brunner Island
    The remaining facility addressed in one of Delaware's petitions is
the Brunner Island facility, which currently has neither SCR nor SNCR
installed. As noted earlier, the EPA has already determined that
Delaware's petitions should be denied based on the EPA's conclusions
that there are no downwind air quality impacts in Delaware in steps one
and two of the four-step framework. Nonetheless, the EPA has evaluated
Brunner Island with respect to step three because it provides another
independent basis for EPA's denial of the petition.
    With respect to the question of whether there are feasible and
cost-effective NOX emissions reductions available at Brunner
Island, the facility primarily burned natural gas with a low
NOX emissions rate in the 2017 ozone season, and the EPA
expects the facility to continue operating primarily by burning natural
gas in future ozone seasons. As such, and as described in more detail
in the following paragraphs, the EPA at this time finds that no
additional feasible and cost-effective NOX emissions
reductions available at Brunner Island have been identified. The EPA,
therefore, has no basis to determine, consistent with the standard of
review outlined in Section IV.A of this notice, that Brunner Island
emits or would emit in violation of the good neighbor provision with
respect to the 2008 or 2015 ozone NAAQS.
    Delaware's CAA section 126(b) petition first proposes that the
operation of natural gas is an available cost-effective emissions
reduction measure that could be implemented at Brunner Island. Brunner
Island completed construction of a natural gas pipeline connection
prior to the beginning of the 2017 ozone season (i.e., by May 1, 2017)
and operated primarily using natural gas as fuel for the 2017 ozone
season. As a result, Brunner Island's actual ozone season
NOX emissions declined from 3,765 tons in 2016 to 877 tons
in 2017,

and the facility's ozone season NOX emissions rate declined
from 0.370 lbs/mmBtu in 2016 to 0.090 lbs/mmBtu in 2017. Thus, Brunner
Island has already implemented the emissions reductions consistent with
what Delaware asserted would qualify as a cost-effective strategy for
reducing NOX emissions. Accordingly, the EPA has determined
that Delaware's CAA section 126(b) petition does not demonstrate that,
at this current level of emissions, Brunner Island emits in violation
of the good neighbor provision.
    Similarly, the EPA concludes that Delaware's petition does not
demonstrate that Brunner Island would emit in violation of the good
neighbor provision. The EPA believes Brunner Island will continue to
primarily use natural gas as fuel during future ozone seasons for
economic reasons. First, compliance with the CSAPR Update provides an
economic incentive to cost-effectively reduce NOX emissions.
Specifically, Brunner Island's participation in the CSAPR
NOX Ozone Season Group 2 allowance trading program provides
an economic incentive to produce electricity in ways that lower ozone
season NOX, such as by burning natural gas relative to
burning coal at this particular power plant. Under the CSAPR Update,
each ton of NOX emitted by a covered EGU has an economic
value--either a direct cost in the case that a power plant must
purchase an allowance to cover that ton of emissions for CSAPR Update
compliance or an opportunity cost in the case that a power plant must
use an allowance in its account for compliance and, thereby, foregoes
the opportunity to sell that allowance on the market. The EPA notes
that Brunner Island's 2017 emissions would have been approximately
2,714 tons more than its actual 2017 emissions if it had operated as a
coal-fired generator, as it did in 2016.\75\ This reduction in
NOX emissions that is attributable to primarily burning
natural gas has an economic value in the CSAPR allowance trading
market.
---------------------------------------------------------------------------

    \75\ This estimated emissions difference was calculated as the
difference between 2017 reported NOX emissions of 877
tons and a counterfactual 2017 NOX emissions estimate of
3,591 tons created using 2017 operations (i.e., heat input of
19,406,872 mmBtu) multiplied by the 2016 NOX emission
rate of 0.37 lb/mmBtu reflecting coal-fired generation. These data
are publicly available at https://www.epa.gov/ampd.
---------------------------------------------------------------------------

    Second, there are continuing fuel-market based economic incentives
suggesting that Brunner Island will continue to primarily burn natural
gas during the ozone season. Brunner Island elected to add the
capability to primarily utilize natural gas by way of a large capital
investment in a new natural gas pipeline capacity connection. Brunner
Island's operators would have planned for and constructed this project
during the recent period of relatively low natural gas prices. In the
years preceding the completion of this natural gas pipeline connection
project (i.e., between 2009 and 2016), average annual Henry Hub natural
gas spot prices ranged from $2.52/mmBtu to $4.37/mmBtu.\76\ The capital
expenditure to construct a natural gas pipeline connection suggests
that natural gas prices within this range make it economic (i.e.,
cheaper) for Brunner Island to burn natural gas to generate electricity
relative to burning coal. As such, future natural gas prices in this
same range suggest that Brunner Island will continue to primarily burn
natural gas during future ozone seasons. The EPA and other independent
analysts expect future natural gas prices to remain low and within this
price range exhibited from 2009 to 2016 due both to supply and
distribution pipeline buildout. For example, the Energy Information
Administration's (EIA) 2018 Annual Energy Outlook (AEO) natural gas
price projections for the Henry Hub spot price range from $3.06/mmBtu
in 2018 to $3.83/mmBtu in 2023.\77\ Moreover, the AEO short-term energy
outlook and New York Mercantile Exchange futures further support the
estimates of a continued low-cost natural gas supply.\78\ These
independent analyses of fuel price data and projections lead to the
EPA's expectation that fuel-market economics will continue to support
Brunner Island's primarily burning natural gas during future ozone
seasons through at least 2023.\79\
---------------------------------------------------------------------------

    \76\ Henry Hub is a significant distribution hub located on the
natural gas pipeline system located in Louisiana. Due to the
significant volume of trades at this location, it is seen as the
primary benchmark for the North American natural gas market. These
data are publicly available at https://www.eia.gov/dnav/ng/hist/rngwhhdA.htm.
    \77\ In the 2018 reference case Annual Energy Outlook (AEO)
released February 6, 2018, created by the U.S. Energy Information
Administration (EIA), natural gas prices for the power sector for
2018 through 2023. Available at https://www.eia.gov/outlooks/aeo/data/browser/#/?id=13-AEO2018&cases=ref2018&sourcekey=0. Projected
delivered natural gas prices for the electric power sector in the
Middle Atlantic region, where Brunner Island is located, ranged
between $3.56 in 2018 and $4.08/mmBtu in 2023. The projected
delivered coal prices for the electric power sector in the Middle
Atlantic region remain relatively constant, ranging from $2.51 to
$2.56/mmBtu. These data are publicly available at https://www.eia.gov/outlooks/aeo/data/browser/#/?id=3-AEO2018®ion=1-2&cases=ref2018&start=2016&end=2023&f=A&linechart=ref2018-d121317a.3-3AEO2018.1-2↦=ref2018-d121317a.4-3-AEO2018.1-2&sourcekey=0.
    \78\ AEO short-term energy outlook available at https://www.eia.gov/outlooks/steo/report/natgas.php.
    \79\ The EPA also notes that a proposed consent decree between
Sierra Club and Talen Energy may further ensure that Brunner Island
will operate by burning gas in the ozone season in 2023 and future
years. Under the settlement, Brunner Island agrees to operate only
on natural gas during the ozone season (May 1-September 30) starting
on January 1, 2023, (subjected to limited exceptions) and cease coal
operations after December 31, 2028. Sierra Club, Talen Energy, and
Brunner Island jointly moved the Middle District of Pennsylvania to
enter the proposed the consent decree, and on August 31, 2018, the
court granted the motion and entered the agreement. See Order
Granting Joint Motion for Entry of Proposed Consent Decree and
Stipulation Extending Defendants' Time to Respond to Complaint,
Sierra Club. v Talen Energy Corp., Case No. 1:18-cv-01042-CCC.
---------------------------------------------------------------------------

    The context in which Brunner Island installed natural gas-firing
capability and burned natural gas is consistent with observed recent
trends in natural gas utilization within the power sector, suggesting
that Brunner Island's economic situation in which it primarily burns
gas as fuel during the ozone season is not unique or limited. Comparing
total heat input from 2014 with 2017 for all units that utilize natural
gas and report to the EPA's Clean Air Markets Division, historical data
showed an increased use of natural gas of 14 percent.\80\ This overall
increase results from both an increase in capacity from the
construction of additional units and an increased gas-fired capacity
factor at existing sources. The available capacity increased six
percent while average capacity factor increased from 23 percent to 25
percent, which reflects an eight percent increase in utilization.
---------------------------------------------------------------------------

    \80\ From 8.4 billion mmBtu to 9.6 billion mmBtu. See EPA's
Clean Air Markets Division data available at https://ampd.epa.gov/ampd/.
---------------------------------------------------------------------------

    Considering the projected continued broader downward trends in
NOX emissions resulting in improved air quality in Delaware,
the EPA anticipates that Brunner Island will likely continue to
primarily burn natural gas during the ozone season as air quality in
Delaware continues to improve. Accordingly, the EPA has no basis to
conclude that the facility would emit in violation of the good neighbor
provision with respect to either the 2008 or 2015 ozone NAAQS.
    Commenters assert that the EPA's interpretation of ``emits'' or
``would emit'' inappropriately proposes to evaluate only a single
year's worth of emissions data or anticipated future rates, without
ensuring that the emission reductions (i.e. evaluated rates) are
permanent and federally enforceable. The EPA disagrees that it is
required to impose federally enforceable limitations at Brunner Island
based on the facts before the agency. The prohibition of CAA section

110(a)(2)(D)(i)(I) is linked directly to CAA section 126(b), in that a
violation of the prohibition in CAA section 110(a)(2)(D)(i) is a
condition precedent for action under CAA section 126(b) and,
critically, that significant contribution to nonattainment and
interference with maintenance should be construed identically for
purposes of both provisions where EPA has already given meaning to the
terms under one provision. 83 FR 7711 through 7722; see also
Appalachian Power, at 1048-50 (affirming as reasonable the EPA's
approach to interpreting a violation of CAA section 110(a)(2)(D)(i)(I)
under CAA section 126 consistent with its approach in the
NOX SIP Call).
    Given the inextricable link between the substantive requirements of
the two provisions, the EPA applied the same four-step framework used
in previous ozone transport rulemakings, including the CSAPR Update,
for evaluating whether Brunner Island significantly contributes to
nonattainment, or interferes with maintenance, of the 2008 and 2015
ozone NAAQS in Delaware. Pursuant to this framework, the EPA first
determines in steps one and two whether emissions from an upwind state
impact downwind air quality problems at a level that exceeds an air
quality threshold, such that the state is linked and, therefore,
contributes to the air quality problem. In step three, the EPA then
determines whether the contribution is ``significant'' or interferes
with maintenance of the NAAQS based on several factors, including the
availability of cost-effective emission reductions at sources within
the state. Where the EPA determines that a source does not have cost-
effective emission reductions available, the EPA concludes that the
source does not significantly contribute to nonattainment or interfere
with maintenance of the NAAQS, and thus, that there are no emissions at
the source that must be ``prohibited'' under CAA section
110(a)(2)(D)(i)(I), and the petition can also be denied on this basis.
    Importantly, the EPA only implements federally enforceable limits
under step four of the four-step framework for sources that the EPA
determines have emissions that significantly contribute to
nonattainment or interfere with maintenance of the ozone NAAQS downwind
under steps one, two, and three. See 81 FR 74553 (declining to impose
CSAPR Update FIP obligations for EGUs in District of Columbia and
Delaware despite linkages to downwind receptors where EPA determined no
cost-effective emission reductions were available). This is consistent
with the statutory language of CAA section 110(a)(2)(D)(i)(I), which
``prohibit[s]'' only those emissions that significantly contribute to
nonattainment or interfere with maintenance of the NAAQS in another
state. The EPA has reasonably interpreted this to mean that where there
is no such impact, the EPA and the states are not required to impose
emission limitations.\81\ The EPA does not dispute that, were it to
find that Brunner Island emits or would emit in violation of the
prohibition under CAA section 110(a)(2)(D)(i)(I), an appropriate remedy
to mitigate the emission impacts would necessarily have to be federally
enforceable, both under CAA section 126(c) (requiring compliance by a
source with EPA-imposed emission limitations and compliance schedules)
and CAA section 110(a)(2)(D)(ii) (requiring a state implementation plan
to contain provisions ensuring compliance with the requirements of CAA
section 126).
---------------------------------------------------------------------------

    \81\ This is also consistent with designation requirements
elsewhere in title I. Downwind areas are initially designated
attainment or nonattainment for the ozone NAAQS based on actual
measured ozone concentrations, regardless of whether the level of
ozone concentrations is due to enforceable emission limits.
Similarly, the EPA generally evaluates whether sources in nearby
areas contribute to measured nonattainment in such areas for
purposes of designations based on actual emission levels, and thus
sources in those nearby areas are generally subject to nonattainment
planning requirements only if actual emissions from that area are
considered to contribute to the air quality problem. Here, where
``significant contribution'' is necessarily a higher standard than
the contribution threshold used in designations, it is reasonable
and consistent to determine that states or EPA need only impose
emission limitations if it is determined that there is significant
contribution or interference with maintenance.
---------------------------------------------------------------------------

    However, for the reasons described in the proposal and in this
final action, the EPA has determined at this time that Brunner Island
does not emit, or would not emit, in violation of CAA section
110(a)(2)(D)(i)(I) under steps one, two, and three for either the 2008
or 2015 ozone NAAQS. Therefore, under the four-step framework, the EPA
does not reach step four's requirement of federally enforceable
emission reductions. However, the EPA notes that if, in fact, Brunner
Island's operations change such that the facility is operating
primarily on coal during future ozone seasons and future emission
levels increase so as to be in violation of the good neighbor
provision, then this final action denying Delaware's petition would not
preclude Delaware from submitting another petition regarding Brunner
Island's impacts. The EPA is not, however, pre-determining what action
may be appropriate on any such future petition, which would depend upon
a variety of factors, including the level of emissions at Brunner
Island and future ozone concentrations in Delaware.

V. Determinations Under Section 307(b)(1)

    Section 307(b)(1) of the CAA indicates which Federal Courts of
Appeal have venue for petitions of review of final actions by the EPA.
This section provides, in part, that petitions for review must be filed
in the Court of Appeals for the District of Columbia Circuit if (i) the
agency action consists of ``nationally applicable regulations
promulgated, or final action taken, by the Administrator,'' or (ii)
such action is locally or regionally applicable, if ``such action is
based on a determination of nationwide scope or effect and if in taking
such action the Administrator finds and publishes that such action is
based on such a determination.''
    The EPA finds that this final action regarding the pending CAA
section 126(b) petitions is ``nationally applicable.'' or, in the
alternative, is based on a determination of ``nationwide scope and
effect'' within the meaning of CAA section 307(b)(1). Through this
rulemaking action, the EPA interprets sections 110 and 126 of the CAA,
statutory provisions which apply to all states and territories in the
United States. In addition, the final action addresses emissions
impacts and sources located in seven States, which are located in
multiple EPA Regions and federal circuits.\82\ This action is also
based on a common core of factual findings and analyses concerning the
transport of pollutants between the different states. Furthermore, the
EPA intends this interpretation and approach to be consistently
implemented nationwide with respect to CAA section 126(b) petitions for
the 2008 and 2015 ozone NAAQS. Courts have found similar actions to be
nationally applicable.\83\ For these reasons, the Administrator finds
that any final action related to this proposal is nationally applicable
or, in the alternative, is based on a determination of nationwide scope
and effect for purposes of CAA section 307(b)(1).
---------------------------------------------------------------------------

    \82\ See H.R. Rep. No. 95-294 at 323, 324, reprinted in 1977
U.S.C.C.A.N. 1402-03.
    \83\ See, e.g., Texas v. EPA, 2011 U.S. App. LEXIS 5654 (5th
Cir. 2011) (finding SIP call to 13 states to be nationally
applicable and thus transferring the case to the U.S. Court of
Appeals for the D.C. Circuit in accordance with CAA section
307(b)(1)).
---------------------------------------------------------------------------

    Thus, the EPA finds that pursuant to CAA section 307(b)(1) any
petitions for review of this final action would be filed in the Court
of Appeals for the District of Columbia Circuit within 60

days from the date any final action is published in the Federal
Register.

VI. Statutory Authority

    42 U.S.C. 7410, 7426, 7601.

    Dated: September 14, 2018.
Andrew R. Wheeler,
Acting Administrator.
[FR Doc. 2018-20854 Filed 10-4-18; 8:45 am]
 BILLING CODE 6560-50-P