[Federal Register Volume 84, Number 202 (Friday, October 18, 2019)]
[Rules and Regulations]
[Pages 56058-56093]
[FR Doc No: 2019-21207]

Vol. 84

Friday,

No. 202

October 18, 2019

Part III

 Environmental Protection Agency

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

40 CFR Part 52

Response to Clean Air Act Section 126(b) Petition From New York; Final
Rule

Federal Register / Vol. 84 , No. 202 / Friday, October 18, 2019 /
Rules and Regulations

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

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-HQ-OAR-2018-0170; FRL-10000-58-OAR]
RIN 2060-AU04

Response to Clean Air Act Section 126(b) Petition From New York

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notification of final action on petition.

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

SUMMARY: The Environmental Protection Agency (EPA) is denying a Clean
Air Act (CAA or Act) petition submitted by the State of New York on
March 12, 2018. The petition requested that the EPA make a finding that
emissions from a group of hundreds of identified sources in nine states
(Illinois, Indiana, Kentucky, Maryland, Michigan, Ohio, Pennsylvania,
Virginia and West Virginia) significantly contribute to nonattainment
and interfere with maintenance of the 2008 and 2015 ozone national
ambient air quality standards (NAAQS) in Chautauqua County and the New
York Metropolitan Area (NYMA) in violation of the good neighbor
provision. The EPA is denying the petition because the petitioner, New
York, has not demonstrated, and the EPA did not independently find,
that the group of identified sources emits or would emit in violation
of the good neighbor provision for the 2008 or 2015 ozone NAAQS in
Chautauqua County and the NYMA.

DATES: This final action is effective on October 18, 2019.

ADDRESSES: The EPA has established a docket for this action under
Docket ID No. EPA-HQ-OAR-2018-0170. All documents in the docket are
listed and publicly available at http://www.regulations.gov. Publicly
available docket materials are also available in hard copy at the Air
and Radiation Docket and Information Center, EPA/DC, EPA William
Jefferson Clinton West Building, Room 3334, 1301 Constitution Avenue
NW, Washington, DC. The Public Reading Room is open from 8:30 a.m. to
4:30 p.m., Monday through Friday, excluding legal holidays. The
telephone number for the Public Reading Room is<PHONE_NUMBER> and the
telephone number for the Air and Radiation Docket and Information
Center is<PHONE_NUMBER>. For additional information about the EPA's
public docket, visit the EPA Docket Center homepage at: http://www.epa.gov/epahome/dockets.htm.

FOR FURTHER INFORMATION CONTACT: Please direct questions concerning
this final action to Beth W. Palma, U.S. EPA, Office of Air Quality
Planning and Standards, Air Quality Policy Division, Mail Code C539-04,
Research Triangle Park, NC 27711, telephone<PHONE_NUMBER>, email at
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: The information in this document is
organized as follows:

I. General Information
    A. Executive Summary of the EPA's Decision on the CAA Section
126(b) Petition From New York
    B. The CAA Section 126(b) Petition From New York
    C. Summary of the EPA's May 6, 2019, Proposal
II. Background and Legal Authority
    A. Ground-Level Ozone and the Interstate Transport of Ozone
    B. CAA Sections 110 and 126
    C. The EPA's Historical Approach To Addressing Interstate
Transport of Ozone Under the Good Neighbor Provision
III. The EPA's Final Response to the CAA Section 126(b) Petition
From New York
    A. Reasonableness of Applying the Four-Step Interstate Transport
Framework for This Action
    B. The EPA's Standard of Review for This CAA Section 126(b)
Petition Regarding the 2008 and 2015 8-Hour Ozone NAAQS
    C. The EPA's Evaluation of Whether the Petition Is Sufficient To
Support a CAA Section 126(b) Finding
IV. Determinations Under CAA Section 307(b)(1) and (d)
V. Statutory Authority

I. General Information

A. Executive Summary of the EPA's Decision on the CAA Section 126(b)
Petition From New York

    In March 2018, the State of New York submitted a petition
requesting that the EPA make a finding pursuant to CAA section 126(b)
that emissions from approximately 350 facilities in nine states
significantly contribute to nonattainment and/or interfere with
maintenance of the 2008 and 2015 ozone NAAQS in violation of CAA
section 110(a)(2)(D)(i)(I), otherwise known as the good neighbor
provision. On May 6, 2019, the EPA issued a proposal to deny the CAA
section 126(b) petition from New York. 84 FR 22787 (May 20, 2019). The
Agency solicited comments on the proposal and hosted a public hearing
on June 11, 2019, during which four speakers testified. The EPA also
received 44 written comments submitted to the docket on the proposed
denial. This Federal Register notification addresses certain
significant comments the Agency received. The EPA addressed the
remaining comments in the separate Response to Comments (RTC) document
available in the docket for this action.
    As described in further detail in this notification, the EPA is
finalizing the denial of the CAA section 126(b) petition submitted by
the State of New York. Generally, the New York petition (and comments
supportive of the EPA granting this petition) suggests that residents
of New York are exposed to unhealthy levels of ground-level ozone
pollution. The petition identifies approximately 350 electric
generating unit (EGU) facilities and non-EGU facilities emitting, or
projected to emit, 400 tons per year or more of nitrogen oxides
(NOX) in nine upwind states and requests that the EPA
establish permanent and enforceable emissions limitations for the named
major NOX sources at levels designed to prevent them from
significantly contributing to nonattainment or interfering with
maintenance of the 2008 and 2015 ozone NAAQS in New York State. In
crafting this final action, the EPA has considered public comments on
its May 6, 2019, proposal to deny this petition.
    Consistent with the EPA's proposal and based on the best data and
information available to the Agency at this time, the Agency is
finalizing its denial of this petition. This denial is based on New
York's failure to meet its statutory burden to demonstrate that the
group of sources identified in the petition emits or would emit in
violation of the good neighbor provision for the 2008 or 2015 ozone
NAAQS with respect to either Chautauqua County or the New York-Northern
New Jersey-Long Island, New York-New Jersey-Connecticut area
(hereafter, the New York metropolitan area or NYMA).
    As indicated in the EPA's proposal, the EPA evaluated New York's
CAA section 126(b) petition consistent with the same four-step
interstate transport framework that the EPA has used in previous
regulatory actions addressing regional ozone transport problems. The
EPA's denial rests on both the first and third steps of this framework.
With respect to the 2008 and 2015 ozone NAAQS in Chautauqua County, the
EPA is denying the petition at step 1 of the framework (i.e., whether
there will be a downwind air quality problem relative to the relevant
NAAQS) based on the conclusion that the petition does not provide
sufficient information to indicate that Chautauqua County should be
considered a nonattainment or maintenance receptor pursuant to the good
neighbor provision. With respect to the 2008 ozone NAAQS in the NYMA,
the EPA is also denying the petition at step 1 of the framework based
on the conclusion that the

petition does not provide sufficient information to indicate that the
NYMA should be considered a nonattainment or maintenance receptor
pursuant to the good neighbor provision. Furthermore, the EPA's own
independent analysis of available information indicates that there is
not currently, nor is there projected to be in 2023, an air quality
problem with respect to either NAAQS in Chautauqua County, and that in
2023 there is not projected to be any further air quality problem with
respect to the 2008 ozone NAAQS in the NYMA.\1\ Thus, for these areas
and NAAQS, the EPA has found that the petition has not met its burden
at step 1 of the four-step interstate transport framework to
demonstrate that the group of identified sources either emits or would
emit pollution in violation of the good neighbor provision. With
respect to the 2015 ozone NAAQS in the NYMA, the Agency's 2023 modeling
shows a relevant downwind air quality problem, and, thus, the EPA is
not denying this portion of the petition with respect to step 1.
---------------------------------------------------------------------------

    \1\ The EPA notes that on September 13, 2019, the D.C. Circuit
issued an opinion remanding the Cross State Air Pollution Rule
Update (CSAPR Update, 81 FR 74504 (October 26, 2016)) in Wisconsin
v. EPA, No. 16-1406. The court held that the rule is inconsistent
with the CAA because it does not fully address upwind states'
obligations under the good neighbor provision by the relevant
attainment date for downwind areas. Nonetheless, the EPA is subject
to a court-ordered deadline to take final action on New York's CAA
section 126(b) petition by September 20, 2019. As explained in this
notification, the EPA is finalizing its denial of New York's CAA
section 126(b) petition, in part, because the petitioner did not
meet its burden to demonstrate both that there is a relevant
downwind air quality under the good neighbor provision in a relevant
future year in either Chautauqua County or the NYMA, and that there
are cost-effective emissions reductions available at the named
sources. This basis for denial based on Petitioner's failure to meet
its burden is independent and severable from any portion of the
denial based on the EPA's discretionary evaluation of downwind air
quality in New York using the Agency's 2023 modeling data. The EPA
may make any necessary or appropriate modifications to this final
action subsequently to reflect its understanding of the court's
holding in Wisconsin.
---------------------------------------------------------------------------

    The EPA is additionally denying the petition as to all areas for
the 2008 and 2015 NAAQS at step 3 of the framework (i.e., whether,
considering cost and air quality factors, emissions from sources in the
named state(s) will significantly contribute to nonattainment or
interfere with maintenance of a NAAQS at a receptor in another state).
The EPA has found that material elements in the petition's assessment
of whether the sources may be further controlled through implementation
of cost-effective controls are insufficient and, thus, New York did not
meet its step 3 burden to demonstrate that the named sources currently
emit or would emit in violation of the good neighbor provision with
respect to the relevant ozone NAAQS.\2\
---------------------------------------------------------------------------

    \2\ The EPA solicited comment on whether to also deny the
petition because the petitioner did not sufficiently justify that
its identification of such a large, undifferentiated number of
sources located in numerous upwind states constitutes a ``group of
stationary sources'' within the context of CAA section 126(b). Based
on the other bases for denial, the EPA does not need to reach the
question of whether the petitioners' failed to sufficiently justify
its interpretation of a ``group of stationary sources'' but notes
that the absence of supporting information for such a determination
makes the Agency unlikely to side with petitioners on the
information provided.
---------------------------------------------------------------------------

    In making this final decision, the EPA reviewed the petition from
New York, the public comments received, the relevant statutory
authorities and other relevant materials. Accordingly, the EPA denies
the CAA section 126(b) petition from New York.
    The remainder of this notification is organized as follows: The
General Information part of this notification (Section I) continues
with a summary of the relevant issues raised in New York's CAA section
126(b) petition and a summary of the EPA's May 6, 2019, proposed
action. Section II of this notification provides background material
and information regarding the EPA's approach to addressing the
interstate transport of ozone under CAA sections 110(a)(2)(D)(i)(I) and
126(b). Section III of this notification discusses the EPA's standard
of review for this action and details the bases for the EPA's final
action to deny this petition, including responses to significant
comments received on the proposal.

B. The CAA Section 126(b) Petition From New York

    On March 12, 2018, the State of New York, through the New York
State Department of Environmental Conservation (NY DEC), submitted a
CAA section 126(b) petition alleging that emissions from a group of
specified upwind sources in Illinois, Indiana, Kentucky, Maryland,
Michigan, Ohio, Pennsylvania, Virginia and West Virginia significantly
contribute to nonattainment and interfere with maintenance of the 2008
and 2015 ozone NAAQS in the NYMA and in Chautauqua County in western
New York.
    The petition contends that, although the Chautauqua County area
(i.e., the area in and around Jamestown, New York) was at the time of
petition submittal (and is currently) attaining both the 2008 and the
2015 ozone NAAQS, the area may have difficulty maintaining its
attainment status in the future. The petition also explains that the
NYMA is currently designated nonattainment for the 2008 ozone NAAQS
and, at the time New York submitted the petition, the area would likely
be designated nonattainment for the 2015 ozone NAAQS.\3\ The petition
further asserts that all three states in the multistate NYMA (i.e., New
York, New Jersey and Connecticut) have surpassed their three-percent-
per-year emissions reductions requirements for the 2008 NAAQS; yet
certified monitoring data through 2016 and (at the time of the petition
submittal) preliminary 2017 data indicate that the area is not
attaining the 2008 NAAQS, with one monitor in Connecticut recording a
preliminary 2017 design value of 83 parts per billion (ppb).
---------------------------------------------------------------------------

    \3\ The EPA had not yet issued final designations at the time
the petition was submitted. On April 30, 2018, the EPA designated
New York-Northern New Jersey-Long Island, NY-NJ-CT area (NYMA) as a
Moderate nonattainment area for the 2015 ozone NAAQS. 83 FR 25776
(June 4, 2018).
---------------------------------------------------------------------------

    The New York petition alleges that emissions from numerous, named
upwind sources significantly contribute to nonattainment and interfere
with maintenance of the 2008 and 2015 8-hour ozone NAAQS in New York
based on two arguments. First, the petition alleges that the EPA's 2017
contribution modeling conducted in support of the EPA's Cross-State Air
Pollution Rule (CSAPR) Update \4\ shows that the nine states in which
these sources are located contribute 1 percent or more of the 2008 8-
hour ozone NAAQS (or 0.75 ppb or more) to ozone concentrations in New
York. Second, the petition describes a study that allegedly found that
air transported into Chautauqua County on the worst air quality days
results in maximum daily ozone concentrations that, on average, are
within 2 ppb of the 2015 ozone NAAQS and often exceed the standard of
70 ppb.\5\
---------------------------------------------------------------------------

    \4\ 81 FR 74504 (October 26, 2016).
    \5\ The petition discusses the results of a study titled the
``Dunkirk Monitor Transport Study,'' which presents an analysis of
back-trajectories used to single out interstate airflow on ``design
days,'' which the petition defines as days considered in the
calculation of the design values. The subject days include the 4
days in each year from 2013 to 2017 with the largest daily maximum
8-hour ozone concentrations at the Dunkirk monitoring site in
Chautauqua County, New York. The Dunkirk monitoring site is the
design value monitoring site in Chautauqua County (i.e., the site
with the highest design value in the county).
---------------------------------------------------------------------------

    When identifying what constitutes significant ozone contributions,
the petition considers the highest emitting facilities (i.e., EGU and
non-EGU facilities emitting, or projected to emit, 400 tons per year or
more of NOX) from the named states and asserts that these
facilities are expected to have the

greatest impact on the ability of the NYMA and Chautauqua County to
attain and maintain the 2008 and 2015 NAAQS.\6\ The petition uses NY
DEC generated air quality modeling data to show single-day, 8-hour
average impacts from the group of 400 ton-per-year sources identified
in any individual state of up to 6.34 ppb in Chautauqua County and 4.97
ppb in the New York portion of the NYMA nonattainment area.\7\ The
petition asserts that instances in which the maximum impact from an
individual state's total combined 400 ton-per-year sources exceeds 0.75
ppb at a particular monitor indicate significant contribution to
nonattainment or interference with maintenance of the 2008 ozone NAAQS.
The petition further asserts that impacts above 0.70 ppb indicate
significant contribution to nonattainment or interference with
maintenance of the 2015 ozone NAAQS. NY DEC used its own independent
modeling to support the assertions in their CAA section 126(b) petition
because the State ``has significant concerns'' about the assumptions
and results of the EPA's recently released 2023 air quality modeling
and its applicability to the CAA section 126(b) petition process.\8\
The petition takes particular issue with the EPA's expectation that
uncontrolled EGUs will greatly reduce their emissions rates in the
absence of unit-level enforceable limits and expresses the additional
concern that the EPA may have underestimated the ozone concentration
results for monitoring sites located near significant water bodies
based on the treatment of model cells containing a land/water
interface. The petition also asserts that modeling of 2023 is
insufficient to support good neighbor state implementation plans (SIPs)
and cannot be used to support a review of New York's petition because
CAA section 126(c) explicitly states that compliance must be met ``in
no case later than three years after the date of [a CAA section 126(b)]
finding,'' and 2023 is more than 3 years after the deadline by which
the EPA must act on the NY DEC petition.
---------------------------------------------------------------------------

    \6\ The petition identifies which facilities emit 400 tons per
year of more of NOX based on 2017 EGU projections by the
Mid-Atlantic Regional Air Management Association. The petition also
identifies non-EGU sources emitting greater than 400 tons of
NOX in the 2014 National Emissions Inventory.
    \7\ The petition provides additional detail regarding the
modeling methodology. Specifically, the petition notes that NY DEC
used version 5.0.2 of the Community Multiscale Air Quality model
with the EPA's Weather Research Forecast (WRF) 2011 meteorological
data to model hourly ozone concentrations during the period May 18
to July 30 for a 2017 ``baseline'' scenario and additional state-by-
state ``control'' modeling scenarios in which emissions from the
named sources in a given state were set to zero. The petition
explains that NY DEC then used the modeled concentrations to
calculate the 8-hour daily maximum average (MDA8) in each grid cell
on each day of the modeling period for each modeled scenario. The
difference in MDA8 concentrations between the 2017 baseline and each
state zero-out run was used to represent the contributions on each
day. The NY DEC then selected the largest single-day contribution
from among the highest ozone concentration days to support their
analysis of contributions relative to a 1-percent-of-the-NAAQS
threshold.
    \8\ See the EPA's October 27, 2017 memorandum titled,
``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)'' that provided future year ozone design values
for monitoring sites in the U.S. based on updated air quality
modeling (for 2023) and monitoring data.
---------------------------------------------------------------------------

    After asserting that the identified sources within the named upwind
states significantly contribute to nonattainment or interfere with
maintenance of the 2008 and 2015 ozone NAAQS in New York, the petition
further asserts that these named sources can reasonably be retrofitted
with control equipment or can operate existing controls more frequently
to reduce NOX emissions. The petition requests that the EPA
establish permanent and enforceable emissions limitations for the named
sources at levels designed to prevent them from significantly
contributing to nonattainment or interfering with maintenance in New
York State. Specifically, the petition requests that the named sources
be subject to emissions limits consistent with Reasonably Available
Control Technology (RACT) as defined by New York State, which bases its
presumptive limits and facility-specific control analyses on a standard
of $5,000 per ton of NOX reduced. The petition acknowledges
that some of the facilities identified in the petition may already
operate with a NOX emissions rate similar to New York's RACT
limits. Nonetheless, the petition asks that the EPA establish
enforceable daily emissions limits during the ozone season to require
these sources to continue to operate at these rates in the future. The
petition claims that enforceable emissions limits would prevent
emissions controls from being turned off, which the petition asserts
occurs when the sources in the State are collectively emitting well
below their seasonal CSAPR budgets. Section III.D of the proposal
provides more detail regarding the content of the New York CAA section
126(b) petition.
    After receiving New York's CAA section 126(b) petition in March of
2018, and consistent with CAA section 307(d)(10), the EPA determined
that the 60-day period for responding to New York's petition was
insufficient for the EPA to act on the petition. On May 11, 2018, the
EPA published a document extending the deadline for acting on New
York's CAA section 126(b) petition to November 9, 2018.\9\ That
document is in the docket for this rulemaking.
---------------------------------------------------------------------------

    \9\ 83 FR 21909 (May 11, 2018).
---------------------------------------------------------------------------

C. Summary of the EPA's May 6, 2019, Proposal

    In Section IV of the proposal, the EPA explained its basis for
proposing to deny the CAA section 126(b) petition from New York. Given
that ozone is a regional pollutant and that the EPA had recently
evaluated regional ozone pollution in two recent rulemakings--the CSAPR
Update \10\ and the Determination Regarding Good Neighbor Obligations
for the 2008 Ozone National Ambient Air Quality Standard \11\ (the
Determination Rule)--the EPA proposed to evaluate New York's CAA
section 126(b) petition consistent with the same four-step interstate
transport framework (see Section II.C.1 of this action) that the EPA
has used in previous regulatory actions to evaluate regional ozone
transport problems.
---------------------------------------------------------------------------

    \10\ 81 FR 74504 (October 26, 2016).
    \11\ 83 FR 65878 (December 21, 2018).
---------------------------------------------------------------------------

    The EPA identified multiple bases for the proposed denial. The EPA
noted that the Agency's historical approach to evaluating CAA section
126(b) petitions first looks at whether a petition independently
identifies or establishes a technical basis for the requested CAA
section 126(b) finding. 84 FR 22797. In this regard, the Agency
proposed to find that several aspects of New York's analyses are
insufficient to support New York's conclusion that the sources named in
the petitions emit or would emit in violation of the good neighbor
provision. First, considering step 1 of the four-step interstate
transport framework, the EPA proposed to find that New York's petition
does not provide sufficient information to demonstrate that there is a
current or expected future downwind nonattainment or maintenance
problem in Chautauqua County with respect to either the 2008 or the
2015 ozone NAAQS. Id. at 22800. Similarly, with respect to the NYMA,
the EPA proposed to find, at step 1, that the New York petition does
not provide sufficient information to indicate that there will be a
future nonattainment or maintenance problem with respect to the 2008
ozone NAAQS. Id. at 22800-01. Second, considering step 3 of the four-
step interstate transport framework, the EPA proposed to find that
material

elements in New York's analyses are technically deficient, such that
the EPA cannot conclude that any source or group of sources in any of
the named states will significantly contribute to nonattainment or
interfere with maintenance in Chautauqua County or the NYMA relative to
the 2008 and 2015 ozone NAAQS. Id. at 22802.
    The EPA further proposed to rely on its own independent analysis to
evaluate the requested CAA section 126(b) findings at step 1
considering available air quality monitoring and modeling data. Id. at
22800. The EPA proposed to find that its independent analysis provides
no basis to conclude that Chautauqua County will have an air quality
problem relative to either the 2008 or the 2015 ozone NAAQS. The EPA
explained that the 2015-2017 design value in Chautauqua County is 68
ppb, which is below the level of both the 2008 and 2015 ozone
NAAQS.\12\ Furthermore, the EPA indicated that it had recently
finalized a determination that the Jamestown, New York Marginal
nonattainment area (Chautauqua County) has attained the 2008 ozone
NAAQS.\13\ Additionally, Section IV.B of the proposal explained that
the EPA's examination in the Determination Rule of the 2023 projected
design values for Chautauqua County indicates that this area is not
projected to be in nonattainment or have a maintenance problem in 2023
for the 2008 ozone NAAQS. The EPA's air quality modeling supporting the
Determination Rule also indicates that the monitor in Chautauqua County
is expected to continue to both attain and maintain the 2015 ozone
NAAQS standard in 2023, with an average 2023 design value of 58.5 ppb
and a maximum 2023 design value of 60.7 ppb.\14\
---------------------------------------------------------------------------

    \12\ The 2015-2017 design value for Chautauqua County in the
``Jamestown-Dunkirk-Fredonia, NY CBSA'' at AQS site 360130006 is 68
ppb. Available at https://www.epa.gov/sites/production/files/2018-07/ozone_designvalues_20152017_final_07_24_18.xlsx.
    \13\ See Approval and Promulgation of Air Quality Implementation
Plans; New York; Determination of Attainment of the 2008 8-Hour
Ozone National Ambient Air Quality Standard for the Jamestown, New
York Marginal Nonattainment Area, 83 FR 49492 (October 2, 2018).
    \14\ See 2023 design values for AQS site 360130006 in
spreadsheet released with the EPA's March 2018 memorandum. Available
at https://www.epa.gov/sites/production/files/2018-05/updated_2023_modeling_dvs_collective_contributions.xlsx.
---------------------------------------------------------------------------

    The EPA also proposed to find that its independent analysis,
conducted to support the Determination Rule, provides no basis to
conclude that the NYMA will have a future air quality problem relative
to the 2008 ozone NAAQS. The EPA's examination of the 2023 projected
design values for the NYMA indicates that this area is not projected to
be in nonattainment or have a maintenance problem in 2023 for the 2008
ozone NAAQS. However, the modeling indicates that the NYMA is projected
to be in nonattainment in 2023 with respect to the 2015 ozone NAAQS.
    As noted previously, considering step 3 of the four-step interstate
transport framework, the EPA proposed to find that material elements in
New York's analyses are technically deficient, such that the EPA cannot
conclude that any source or group of sources in any of the named states
will significantly contribute to nonattainment or interfere with
maintenance in Chautauqua County or the NYMA relative to the 2008 and
2015 ozone NAAQS. As discussed in Section IV.B of the proposal, the EPA
did not independently conduct a regional step 3 analysis for any
sources with respect to the 2015 ozone NAAQS because the EPA interprets
CAA section 126(b) as placing the burden on the petitioner to establish
a technical basis for the specific finding requested, and, unlike the
step 1 analysis, the EPA lacked information and analysis on which it
could rely for such an independent step 3 analysis.

II. Background and Legal Authority

    This section of the notification discusses background and legal
authority relevant to this action beginning with an overview of ozone
formation and interstate transport in Section II.A. Section II.B of
this notification describes the key statutory provisions under both CAA
sections 126 and 110(a)(2)(D)(i)(I), including the relationship between
the good neighbor provision and CAA section 126(b). Section II.C
summarizes the EPA's historical approach to addressing the interstate
transport of ozone under the good neighbor provision to include a
description of the four-step interstate transport framework and the
EPA's prior regional rulemakings.

A. Ground-Level Ozone and the Interstate Transport of Ozone

    On March 12, 2008, the EPA promulgated a revision to the ground-
level ozone NAAQS, lowering both the primary and secondary standards to
75 ppb.\15\ On October 1, 2015, the EPA further revised the ground-
level ozone NAAQS to 70 ppb.\16\
---------------------------------------------------------------------------

    \15\ See National Ambient Air Quality Standards for Ozone, Final
Rule, 73 FR 16436 (March 27, 2008).
    \16\ See National Ambient Air Quality Standards for Ozone, Final
Rule, 80 FR 65292 (October 26, 2015).
---------------------------------------------------------------------------

    As discussed in Section III.A of the proposal, ground-level ozone
is not emitted directly into the air but is a secondary air pollutant
created by chemical reactions between ozone precursors, chiefly
NOX and non-methane volatile organic compounds (VOCs), in
the presence of sunlight. Emissions from mobile sources, EGUs,
industrial facilities, gasoline vapors, and chemical solvents are some
of the major anthropogenic sources of ozone precursors. These precursor
emissions can be transported downwind directly or, after transformation
in the atmosphere, as ozone. Studies have established that ozone
formation, atmospheric residence, and transport can occur on a regional
scale (i.e., across hundreds of miles) over much of the eastern United
States. Thus, in any given location, ozone pollution levels are
affected by a combination of local emissions and emissions from upwind
sources. Numerous observational studies have demonstrated the transport
of ozone and its precursors and the impact of upwind emissions on high
concentrations of ozone pollution.\17\ For further discussion of ozone-
formation chemistry and health effects, see the National Ambient Air
Quality Standards for Ozone, Final Rule, 80 FR 65292 (October 26,
2015). For further discussion of the regional nature of interstate
transport of ozone pollution see the Determination Rule, 83 FR 65879-80
(December 21, 2018).
---------------------------------------------------------------------------

    \17\ For example, Bergin, M.S. et al. (2007). Regional air
quality: local and interstate impacts of NOX and
SO2 emissions on ozone and fine particulate matter in the
eastern United States. Environmental Sci & Tech. 41: 4677-4689.
---------------------------------------------------------------------------

B. CAA Sections 110 and 126

    CAA sections 126 and 110(a)(2)(D)(i) provide the statutory
authority for this action. Section 126(b) of the CAA provides, among
other things, that any state or political subdivision may petition the
Administrator of the EPA to find that any major source or group of
stationary sources in an upwind state emits or would emit any air
pollutant in violation of the prohibition of CAA section
110(a)(2)(D)(i), referred to as the good neighbor provision of the
Act.\18\ Petitions submitted pursuant to this section are commonly
referred to as CAA section 126(b) petitions. Similarly, findings by the
Administrator, pursuant to this section, that a source or group of

sources emits air pollutants in violation of the CAA section
110(a)(2)(D)(i) prohibition are commonly referred to as CAA section
126(b) findings.
---------------------------------------------------------------------------

    \18\ The text of CAA section 126 as codified in the U.S. Code
cross-references CAA section 110(a)(2)(D)(ii) instead of CAA section
110(a)(2)(D)(i). The courts have confirmed that this is a
scrivener's error and that Congress instead intended to cross-
reference CAA section 110(a)(2)(D)(i). See Appalachian Power Co. v.
EPA, 249 F.3d 1032, 1040-44 (D.C. Cir. 2001).
---------------------------------------------------------------------------

    CAA section 126 explains the effect of a CAA section 126(b) finding
and establishes the conditions under which continued operation of a
source subject to such a finding may be permitted. Specifically, CAA
section 126(c) provides that it is a violation of section 126 of the
Act and of the applicable SIP: (1) For any major proposed new or
modified source subject to a CAA section 126(b) finding to be
constructed or operate in violation of the prohibition of CAA section
110(a)(2)(D)(i) or (2) for any major existing source for which such a
finding has been made to stay in operation more than 3 months after the
date of the finding. The statute, however, also gives the Administrator
discretion to permit the continued operation of a source beyond 3
months if the source complies with emissions limitations and compliance
schedules provided by the EPA to bring about compliance with the
requirements contained in CAA sections 110(a)(2)(D)(i) and 126 as
expeditiously as practicable, but in any event no later than 3 years
from the date of the finding.
    Section 110(a)(2)(D)(i) of the CAA requires states to prohibit
certain emissions from in-state sources if such emissions impact the
air quality in downwind states. Specifically, CAA sections 110(a)(1)
and 110(a)(2)(D)(i)(I) require all states, within 3 years of
promulgation of a new or revised NAAQS, to submit SIPs that contain
adequate provisions prohibiting any source or other type of emissions
activity within the state from emitting any air pollutant in amounts
which will contribute significantly to nonattainment in, or interfere
with maintenance by, any other state with respect to that NAAQS. As
described further in Section II.C.2, the EPA has developed several
regional rulemakings to address the requirements of CAA section
110(a)(2)(D)(i)(I) for the various ozone NAAQS. The EPA's most recent
rulemaking, the Determination Rule, finalized a determination that the
existing CSAPR Update fully addresses certain states' interstate
transport obligations under CAA section 110(a)(2)(D)(i)(I) for the 2008
ozone NAAQS. 83 FR 65878 (December 21, 2018).
    Section 110(a)(2)(D)(ii) of the CAA further requires SIPs to
contain adequate provisions ensuring compliance with the applicable
requirements of, inter alia, CAA section 126. Thus, where the EPA has
made a finding pursuant to CAA section 126(b), this provision requires
states to revise their SIPs to adopt any emissions limitations and
compliance schedules provided by the EPA under CAA section 126(c).

C. The EPA's Historical Approach To Addressing Interstate Transport of
Ozone Under the Good Neighbor Provision

    Given that formation, atmospheric residence, and transport of ozone
can occur on a regional scale (i.e., across hundreds of miles) and that
many separate areas across the eastern U.S. have struggled to attain
and maintain the NAAQS, the EPA has historically addressed the
interstate transport of ozone pursuant to the good neighbor provision
by promulgating rulemakings that addressed significant contribution and
interference with maintenance through regional trading programs to
reduce NOX emissions. Each of these rulemakings followed a
similar four-step interstate transport framework to evaluate and
address the extent of the ozone transport problem (i.e., the breadth of
downwind ozone problems and the contributions from upwind states) and,
ultimately, to find that downwind states' problems attaining and
maintaining the ozone NAAQS result from an interconnected system of
transported pollution emitted by multiple upwind sources located in
different upwind states combined with downwind (i.e., locally
generated) ozone.
1. Description of the Four-Step Interstate Transport Framework
    Through the development and implementation of several previous
rulemakings,\19\ the EPA established the following four-step interstate
transport framework to address the requirements of the good neighbor
provision for regional pollutants such as ozone and fine particulate
matter (PM2.5):
---------------------------------------------------------------------------

    \19\ See Finding of Significant Contribution and Rulemaking for
Certain States in the Ozone Transport Assessment Group Region for
Purposes of Reducing Regional Transport of Ozone (also known as the
NOX SIP Call), 63 FR 57356 (October 27, 1998); Clean Air
Interstate Rule (CAIR) Final Rule, 70 FR 25162 (May 12, 2005); CSAPR
Final Rule, 76 FR 48208 (August 8, 2011); CSAPR Update Final Rule,
81 FR 74504 (October 26, 2016); Determination Rule, 83 FR 65878
(December 21, 2018).
---------------------------------------------------------------------------

    (1) Identify downwind receptors that are expected to have problems
attaining or maintaining the NAAQS. The EPA historically identified
downwind areas with air quality problems, referred to as receptors,
using air quality modeling projections for a future analytic year and,
where appropriate, considering monitored air quality data.
    (2) Determine which upwind states are linked to these identified
downwind air quality problems and thus warrant further analysis to
determine whether their emissions violate the good neighbor provision.
In the EPA's most recent transport rulemakings for the 1997 and 2008
ozone NAAQS, as well as the 1997 and 2006 PM2.5 NAAQS, the
Agency identified such upwind states to be those modeled to contribute
at or above an air quality threshold relative to the applicable NAAQS.
    (3) For states linked to downwind air quality problems, identify
upwind emissions (if any) on a statewide basis that will significantly
contribute to nonattainment or interfere with maintenance of a standard
at a receptor in another state. In the EPA's prior rulemakings for
ozone and PM2.5, the Agency identified and apportioned
emissions reduction responsibility among multiple upwind states linked
to downwind air quality problems by identifying a uniform level of
control stringency for certain sources in the state based on cost and
air quality factors evaluated in a multi-factor test.
    (4) For upwind states that are found to have emissions that will
significantly contribute to nonattainment or interfere with maintenance
of the NAAQS downwind, implement the necessary emissions reductions
within the state. When the EPA has promulgated federal implementation
plans (FIPs) addressing the good neighbor provision for ozone and
PM2.5 NAAQS in prior transport rulemakings, the EPA has
typically required affected sources in upwind states to participate in
allowance trading programs to achieve the necessary emissions
reductions.\20\ In addition, the EPA has also offered states the
opportunity to participate in comparable EPA-operated allowance trading
programs to achieve the necessary emissions reductions through SIPs.
---------------------------------------------------------------------------

    \20\ While the EPA has chosen to implement emissions reductions
through allowance trading programs for states found to have a
downwind impact, upwind states can choose to submit a SIP that
implements such reductions through other enforceable mechanisms that
meet the requirements of the good neighbor provision, such as the
enforceable mechanisms that the petitioner apparently favors in its
petition.
---------------------------------------------------------------------------

    Using the four-step framework to evaluate a particular interstate
transport problem allows the EPA to determine whether upwind states
actually contribute to a downwind air quality problem, whether and
which sources can be cost-effectively controlled to address that
downwind air quality

problem, what level of emissions should be eliminated to address the
downwind air quality problem (and thus should be considered
``significant''), and the means of implementing corresponding emissions
limits (i.e., source-specific rates or statewide emissions budgets in a
limited regional allowance trading program). The outcome of this
assessment varies based on the scope of the air quality problem, the
availability and cost of controls at sources in upwind states, and the
estimated impact of upwind emissions reductions on downwind ozone
concentrations.
2. Prior Regional Rulemakings Under the Good Neighbor Provision
    The EPA's first regional interstate transport rulemaking, the
NOX SIP Call, addressed the 1979 ozone NAAQS. 63 FR 57356
(October 27, 1998).\21\ The NOX SIP Call was the result of
the analytic work and recommendations of the Ozone Transport Assessment
Group, which was organized and led by states in consultation with the
EPA and other stakeholders. The EPA used this collaboratively developed
analysis to conclude in the NOX SIP Call that ``[t]he fact
that virtually every nonattainment problem is caused by numerous
sources over a wide geographic area is a factor suggesting that the
solution to the problem is the implementation over a wide area of
controls on many sources, each of which may have a small or
unmeasurable ambient impact by itself.'' 63 FR 57356, 57377 (October
27, 1998). The NOX SIP Call promulgated statewide emissions
budgets and required upwind states to adopt SIPs that would decrease
their NOX emissions to meet these budgets, thereby
prohibiting the emissions that significantly contribute to
nonattainment or interfere with maintenance of the ozone NAAQS in
downwind states. The EPA also promulgated a model rule for a regional
allowance trading program called the NOX Budget Trading
Program that states could adopt in their SIPs as a mechanism to achieve
some or all required emissions reductions. All jurisdictions covered by
the NOX SIP Call ultimately chose to adopt the
NOX Budget Trading Program into their SIPs. The
NOX SIP Call was upheld by the U.S. Court of Appeals for the
District of Columbia Circuit (D.C. Circuit) in all pertinent respects.
See Michigan v. EPA, 213 F.3d 663 (2000).
---------------------------------------------------------------------------

    \21\ As originally promulgated, the NOX SIP Call also
addressed good neighbor obligations under the 1997 8-hour ozone
NAAQS, but the EPA subsequently stayed the rule's provisions with
respect to that standard. 65 FR 56245 (September 18, 2000). The EPA
recently finalized an action rescinding the findings of good
neighbor obligations with respect to the 1997 ozone NAAQS as a basis
for the NOX SIP Call. 84 FR 8422 (March 8, 2019).
---------------------------------------------------------------------------

    In coordination with the NOX SIP Call rulemaking under
CAA section 110(a)(2)(D)(i)(I), the EPA also addressed several pending
CAA section 126(b) petitions submitted by eight northeastern states
regarding the same air quality issues addressed by the NOX
SIP Call, specifically interstate ozone transport for the 1979 ozone
NAAQS. These CAA section 126(b) petitions asked the EPA to find that
ozone precursor emissions from numerous sources located in 30 states
and the District of Columbia had adverse air quality impacts on the
petitioning downwind states. Half of the petitioning states (i.e.,
Connecticut, Maine, New York, and Pennsylvania) requested an allowance
trading program to reduce NOX emissions and remedy regional
interstate ozone transport. 63 FR 56297 (October 21, 1998). Based on
analysis conducted for the NOX SIP Call regarding upwind
state impacts on downwind air quality, the EPA, in May 1999, made
technical determinations regarding the claims in the petitions, but did
not at that time make the CAA section 126(b) findings requested by the
petitions. 64 FR 28250 (May 25, 1999). In making these technical
determinations, the EPA concluded that the NOX SIP Call
would fully address and remediate the claims raised in these petitions
and that the EPA would, therefore, not need to take separate action to
remedy any potential violations of the CAA section 110(a)(2)(D)(i)
prohibition. 64 FR 28252. However, subsequent litigation resulted in a
judicial stay of the NOX SIP Call and led the EPA to ``de-
link'' the CAA section 126(b) petition response from the NOX
SIP Call. The EPA made final CAA section 126(b) findings for 12 states
named in the petitions and the District of Columbia. The EPA found that
sources in these states emitted in violation of the prohibition in the
good neighbor provision with respect to the 1979 ozone NAAQS based on
the affirmative technical determinations made in the May 1999
rulemaking. To remedy the violation under CAA section 126(c), the EPA
required affected sources in the upwind states to participate in a
regional allowance trading program whose requirements were designed to
be interchangeable with the requirements of the optional NOX
Budget Trading Program model rule provided under the NOX SIP
Call. 65 FR 2674 (January 18, 2000). The EPA's action on these CAA
section 126(b) petitions was upheld by the D.C. Circuit. See
Appalachian Power Co. v. EPA, 249 F.3d 1032 (D.C. Cir. 2001).
    The EPA next promulgated the Clean Air Interstate Rule (CAIR), 70
FR 25162 (May 12, 2005), to address interstate transport under the good
neighbor provision with respect to the 1997 ozone NAAQS, as well as the
1997 PM2.5 NAAQS. 70 FR 25172. The EPA adopted the same
approach for quantifying the level of states' significant contribution
to downwind nonattainment in CAIR as it used in the NOX SIP
Call, based on the determination in the NOX SIP Call that
downwind ozone nonattainment is due to the impact of emissions from
numerous upwind sources and states. 70 FR 25162, 25172 (May 12, 2005).
The EPA explained that ``[t]ypically, two or more States contribute
transported pollution to a single downwind area, so that the
`collective contribution' is much larger than the contribution of any
single State.'' 70 FR 25186. CAIR included two distinct regulatory
processes: (1) A rulemaking to define significant contribution (i.e.,
the emissions reduction obligation) under the good neighbor provision
and provide for submission of SIPs eliminating that contribution, 70 FR
25162 (May 12, 2005); and (2) a rulemaking to promulgate, where
necessary, FIPs imposing emissions limitations in the event states did
not submit SIPs. 71 FR 25328 (April 28, 2006). The FIPs required EGUs
in affected states to participate in regional allowance trading
programs, which replaced the previous NOX Budget Trading
Program.
    In conjunction with the second CAIR rulemaking, which promulgated
backstop FIPs, the EPA acted on a CAA section 126(b) petition received
from the State of North Carolina on March 19, 2004, seeking a finding
that large EGUs located in 13 states were significantly contributing to
nonattainment and/or interfering with maintenance of the 1997 ozone
NAAQS and the 1997 PM2.5 NAAQS in North Carolina. Citing the
analyses conducted to support the promulgation of CAIR, the EPA denied
North Carolina's CAA section 126(b) petition in full based on
determinations either that the named states were not adversely
impacting downwind air quality in violation of the good neighbor
provision, or that such impacts were fully remedied by implementation
of the emissions reductions required by the CAIR FIPs. 71 FR 25328,
25330 (April 28, 2006).
    The D.C. Circuit found that the EPA's approach to CAA section
110(a)(2)(D)(i)(I) in CAIR was ``fundamentally flawed'' in several

respects, and the rule was remanded in July 2008 with the instruction
that the EPA replace the rule ``from the ground up.'' North Carolina v.
EPA, 531 F.3d 896, 929 (D.C. Cir.), modified on reh'g, 550 F.3d 1176
(D.C. Cir. 2008). The decision concluded the EPA's analysis and
compliance mechanisms did not address all elements required by the
statute. The EPA's separate action denying North Carolina's CAA section
126(b) petition was not challenged.
    On August 8, 2011, the EPA promulgated CSAPR to replace CAIR. 76 FR
48208 (August 8, 2011). CSAPR addressed the same (1997) ozone and
PM2.5 NAAQS as CAIR and additionally addressed interstate
transport for the 2006 PM2.5 NAAQS by requiring 28 states to
reduce sulfur dioxide (SO2) emissions, annual NOX
emissions, and/or ozone season NOX emissions that would
significantly contribute to other states' nonattainment or interfere
with other states' ability to maintain these air quality standards.
Consistent with prior determinations made in the NOX SIP
Call and CAIR, the EPA again found that emissions from sources in
multiple upwind states contributed to ozone nonattainment in multiple
downwind states. Specifically, the EPA found ``that the total
`collective contribution' from upwind sources represents a large
portion of PM2.5 and ozone at downwind locations and that
the total amount of transport is composed of the individual
contribution from numerous upwind states.'' 76 FR 48237. Accordingly,
the EPA conducted a regional analysis, calculated emissions budgets for
affected states, and required EGUs in these states to participate in
new regional allowance trading programs to reduce statewide emissions
levels.\22\ CSAPR was subject to nearly 4 years of litigation.
Ultimately, the Supreme Court upheld the EPA's approach to calculating
emissions reduction obligations and apportioning upwind state
responsibility under the good neighbor provision, but also held that
the EPA was precluded from requiring more emissions reductions than
necessary to address downwind air quality problems, or ``over-
controlling'' upwind state emissions. See EPA v. EME Homer City
Generation, L.P., 572 U.S. 489, 521-22 (2014) (EME Homer City).\23\
---------------------------------------------------------------------------

    \22\ The CSAPR trading programs included assurance provisions to
ensure that emissions are reduced within each individual state, in
accordance with North Carolina, 531 F.3d at 907-08 (holding the EPA
must require elimination of emissions from each upwind state that
contribute significantly to nonattainment and interfere with
maintenance in downwind areas). Those provisions were also included
in the CSAPR Update and took effect with the 2017 CSAPR compliance
periods.
    \23\ On remand from the Supreme Court, the D.C. Circuit further
affirmed various aspects of the CSAPR, while remanding the rule
without vacatur for reconsideration of certain states' emissions
budgets where it found those budgets may over-control emissions
beyond what was necessary to address the good neighbor requirements.
EME Homer City Generation, L.P. v. EPA, 795 F.3d 118 (2015) (EME
Homer City II). The EPA addressed the remand in several rulemaking
actions in 2016 and 2017.
---------------------------------------------------------------------------

    In 2016, the EPA promulgated the CSAPR Update to address the good
neighbor provision requirements for the 2008 ozone NAAQS. 81 FR 74504
(October 26, 2016). The CSAPR Update built upon previous regulatory
efforts to address the collective contributions of ozone pollution from
22 states in the eastern U.S. to widespread downwind air quality
problems. As with previous rulemakings, the EPA evaluated the nature
(i.e., breadth and interconnectedness) of the ozone problem and
NOX reduction potential from EGUs, including essentially all
the EGUs at the facilities named in the New York CAA section 126(b)
petition.\24\ In the CSAPR Update, the EPA quantified emissions
reduction obligations for each state based on an analysis of control
strategies that could be implemented by the upcoming 2017 ozone season,
which coincided with the (then) upcoming 2018 Moderate area attainment
date. The EPA implemented those emissions reductions through FIPs which
required EGUs in affected states to participate in a regional allowance
trading program to further reduce statewide NOX emissions
levels. The CSAPR Update is subject to pending legal challenges in the
D.C. Circuit. Wisconsin v. EPA, No. 16-1406 (D.C. Cir. argued October
3, 2018).
---------------------------------------------------------------------------

    \24\ The EPA uses the language ``essentially all the EGUs at the
facilities named . . . .'' (emphasis added) to clarify that the New
York petition identifies sources at the facility, rather than at the
unit, level. The CSAPR Update looked at unit-level data and included
all fossil-fuel-fired boiler or combustion turbine EGUs with a
capacity (electrical output) greater than 25 megawatts (MW). See 81
FR 74563 (October 26, 2016).
---------------------------------------------------------------------------

    At the time the EPA finalized the CSAPR Update in 2016, the EPA was
unable to determine whether the rule fully resolved good neighbor
obligations with respect to the 2008 ozone NAAQS for most (i.e., 21) of
the States subject to that action, including those addressed in New
York's petition (i.e., Illinois, Indiana, Kentucky, Maryland, Michigan,
Ohio, Pennsylvania, Virginia and West Virginia). The EPA stated that,
based on its analysis of 2017 air quality at that time, the emissions
reductions required by the rule ``may not be all that is needed'' to
address transported emissions.\25\ 81 FR 74521-22 (October 26, 2016).
The information available at that time suggested that downwind air
quality problems would remain in 2017 after implementation of the CSAPR
Update and that upwind states continued to be linked to those downwind
problems at or above the 1 percent threshold used at step 2 of the
EPA's analysis. However, in the CSAPR Update, the EPA could not
determine whether, in step 3 of the four-step interstate transport
framework, the EPA had quantified all emissions reductions that may be
considered cost-effective because the rule did not evaluate non-EGU
ozone season NOX reductions or further EGU control
strategies (i.e., the implementation of new post-combustion controls)
that may be achievable on timeframes extending beyond the 2017 analytic
year used in the EPA's analysis. The Agency recognized that completing
such an analysis could extend the timeframe for action and prioritized
the substantial short-term emissions reductions achievable for the 2017
ozone season. See 81 FR 74521 for additional details.
---------------------------------------------------------------------------

    \25\ The EPA determined that the emissions reductions required
by the CSAPR Update satisfied the full scope of the good neighbor
obligation for Tennessee with respect to the 2008 ozone NAAQS. 81 FR
74551-52 (October 26, 2016).
---------------------------------------------------------------------------

    On December 6, 2018, the EPA finalized a determination that, based
on the latest available emissions inventory and air quality modeling
data for a 2023 analytic year, the CSAPR Update fully addresses the
good neighbor provision requirements for the 2008 ozone NAAQS for 20
eastern states (among the 22) previously addressed in the CSAPR Update.
83 FR 65878 (December 21, 2018). The EPA's Determination Rule applied
the four-step interstate transport framework but did not move beyond an
analysis at step 1, because the EPA found that there would be no
remaining nonattainment or maintenance receptors for the 2008 ozone
NAAQS in the eastern U.S. in 2023. Therefore, with the CSAPR Update
fully implemented, the EPA finalized in the Determination Rule a
finding that the 20 states addressed by that action (including eight of
the nine states named in New York's petition) will not contribute
significantly to nonattainment in, or interfere with maintenance by,
any other state regarding the 2008 ozone NAAQS. The EPA had already
determined that the remaining two states would have no remaining good
neighbor obligation for the 2008 ozone NAAQS--one in the CSAPR Update
(Tennessee), 81 FR 74540 (October 26, 2016), and the other in a
separate SIP approval (Kentucky,

the ninth state named in New York's petition), 83 FR 33730 (July 17,
2018), that relied on the same air quality modeling used in the
Determination Rule. The Determination Rule is subject to pending legal
challenges in the D.C. Circuit. New York v. EPA, No. 19-1019 (D.C.
Cir.).
    Most recently, the EPA acted on six CAA section 126(b) petitions
pertaining to the 2008 and 2015 ozone NAAQS submitted by the States of
Connecticut, Delaware, and Maryland regarding various sources in five
upwind states. In denying the petitions, the EPA applied the same four-
step interstate transport framework used in prior rulemakings and
relied on analysis and determinations made in the CSAPR Update for
purposes of evaluating the good neighbor obligations with respect to
the 2008 ozone NAAQS. 83 FR 16064 (April 13, 2018) (Connecticut) 83 FR
50444 (October 5, 2018) (Delaware and Maryland).\26\ The EPA found that
the downwind areas were not projected to have problems attaining or
maintaining the NAAQS (step 1) and/or that the petition failed to
identify cost-effective emissions reductions for the affected sources
(step 3), particularly where enforceable emissions limits had already
been implemented for certain sources in the form of state-wide
emissions budgets and, thus, the EPA already had addressed their
significant contribution or interference with maintenance for those
sources.
---------------------------------------------------------------------------

    \26\ The EPA's denial of the Delaware and Maryland petitions is
subject to pending legal challenges in the D.C. Circuit. Maryland v.
EPA, No. 18-1285 (D.C. Cir. filed October 15, 2018).
---------------------------------------------------------------------------

III. The EPA's Final Response to the CAA Section 126(b) Petition From
New York

    The EPA is finalizing a denial of the CAA section 126(b) petition
from New York. Section III.A of this notification describes the
reasonableness of applying the four-step interstate transport framework
as the standard of review in evaluating New York's CAA section 126(b)
petition. Section III.B discusses the EPA's general standard of review
of CAA section 126(b) petitions. Section III.C describes the EPA's
determination that New York has not demonstrated that the sources named
in its petition emit or would emit in violation of the good neighbor
provision such that they will significantly contribute to nonattainment
or interfere with maintenance of the 2008 or 2015 ozone NAAQS in New
York. Where the EPA has currently available information to inform an
independent analysis of New York's petition, we also present this
information in Section III.C. In Section III, generally, and in the RTC
document included in the docket for this action, the Agency explains
the rationale supporting its final action and provides its response to
significant public comments on the proposed action.

A. Reasonableness of Applying the Four-Step Interstate Transport
Framework for This Action

    As discussed in Section II.C of this notification, the EPA has
consistently analyzed ozone transport with the understanding that
nonattainment and maintenance concerns result from the cumulative air
quality impacts of contributions from numerous anthropogenic sources
across several upwind states (as well as from within the downwind
state). Consistent with this understanding, the EPA has historically
evaluated ozone transport based, in part, on the relative contribution
of all anthropogenic sources within a state, as measured against a
screening threshold, and then identified particular source sectors and
units for regulatory consideration.\27\ This approach to evaluating
ozone transport is reasonable because the statute's use of
``significantly'' as a modifier to ``contribute'' implies a
relationship (e.g., the impact a source or collection of sources has
relative to other relevant sources of that pollutant). Therefore,
although CAA section 126(b) allows downwind states to petition the EPA
regarding specific sources or groups of sources that they believe are
contributing to the downwind air quality problems, the EPA believes it
is reasonable and appropriate to evaluate the emissions from sources
named in a CAA section 126(b) petition in the context of all relevant
anthropogenic sources of that pollutant to determine whether emissions
from the named sources violate the good neighbor provision. In this
way, the EPA can evaluate whether the petitioner has appropriately
identified the source or group of sources that should be regulated.
---------------------------------------------------------------------------

    \27\ The EPA has used cost as a factor in its multi-factor
approach for quantifying significant contribution from multiple
contributing states. Cost is used in a relative (i.e., least-cost
abatement) approach that also requires examining individual source
impact and reduction potential in the context of the larger universe
of contributors.
---------------------------------------------------------------------------

    The EPA notes that the four-step framework provides a logical,
consistent and systematic approach for addressing interstate transport
for a variety of criteria pollutants under a broad array of national,
regional and local scenarios. Consequently, the EPA finds it reasonable
to apply the same four-step interstate transport framework used to
evaluate regional ozone transport under the good neighbor provision in
considering a CAA section 126(b) petition addressing the impacts of
individual sources on downwind attainment and maintenance of the ozone
NAAQS. As the four-step interstate transport framework is applied to
evaluate a particular interstate transport problem, the EPA can
determine whether upwind sources are actually contributing to a
downwind air quality problem; whether and which sources can be cost
effectively controlled relative to that downwind air quality problem;
what level of emissions should be eliminated to address the downwind
air quality problem and the means of implementing corresponding
emissions limits (i.e., source-specific rates, or statewide emissions
budgets in a limited regional allowance trading program). The outcome
of this assessment will vary based on the scope of the air quality
problem, the availably and cost of controls at sources in upwind states
and the relative impact of upwind emissions reductions on downwind
ozone concentrations.
    The complexity of atmospheric chemistry and nature of ozone
transport also demonstrate the appropriateness of applying the four-
step interstate transport framework in considering a CAA section 126(b)
petition. As a result of this complexity, including domestic and
international as well as anthropogenic and background contributions to
ozone and its precursors, it is less likely that a single source is
entirely responsible for impacts to a downwind area. Thus, a
determination regarding whether this impact is sufficient to
significantly contribute to nonattainment or interfere with maintenance
of the NAAQS--in light of other anthropogenic emissions sources
impacting a downwind area--is necessarily more complicated. The EPA
therefore evaluates within step 3 of the framework whether upwind
sources have emissions that significantly contribute to nonattainment
or interfere with maintenance of the ozone NAAQS based on various
control, cost and air quality factors, including the magnitude of
emissions from upwind states, the amount of potential emissions
reductions from upwind sources, the cost of those potential emissions
reductions, and the potential air quality impacts of emissions
reductions.\28\ The

EPA believes it is reasonable to consider these factors whether
evaluating ozone transport in the context of a good neighbor SIP under
CAA section 110 or a CAA section 126(b) petition.
---------------------------------------------------------------------------

    \28\ ``We believe it is important to consider both [cost and air
quality] factors because circumstances related to different downwind
receptors can vary and consideration of multiple factors can help
EPA appropriately identify each state's significant contribution
under different circumstances . . . . Using both air quality and
cost factors allows EPA to consider the full range of circumstances
and state-specific factors that affect the relationship between
upwind emissions and downwind nonattainment and maintenance
problems. For example, considering cost takes into account the
extent to which existing plants are already controlled as well as
the potential for, and relative difficulty of, additional emissions
reductions. Therefore, EPA believes that it is appropriate to
consider both cost and air quality metrics when quantifying each
state's significant contribution.'' Proposed Federal Implementation
Plans To Reduce Interstate Transport of Fine Particulate Matter and
Ozone, 75 FR 45210, 45271 (August 2, 2010) (CSAPR proposal)
(describing potential disparities between upwind and downwind state
contributions to identified air quality problems and between levels
of controls between states).
---------------------------------------------------------------------------

    For any analysis of a CAA section 126(b) petition regarding
interstate transport of ozone, a regional pollutant with contribution
from a variety of sources, the EPA reviews whether the particular
sources identified by the petitioner should be controlled in light of
the collective impact of emissions on air quality in the area,
including emissions from other anthropogenic sources. Thus, review of
the named sources in New York's petition provides a starting point for
the EPA's evaluation, but does not--as the commenters suggest--complete
the evaluation to determine whether the named sources emit or would
emit in violation of the good neighbor provision.
    Several commenters assert that the EPA incorrectly applied the
four-step interstate transport framework used to address CAA section
110(a)(2)(D)(i)(I) to the separate provision under CAA section 126(b).
Specifically, one commenter states that the four-step interstate
transport framework aligns with the planning requirements under CAA
section 110(a)(2)(D)(i)(I) because it allows contribution to be
apportioned by state boundaries particularly at step 2, which considers
whether an upwind state is linked to the downwind air quality problem
above an identified air quality threshold. The commenter explains that
applying such a threshold allows the collective ``significant
contribution'' from a group of sources located in multiple upwind
states to be apportioned into ``non-significant contributions''
according to state boundaries. The commenter continues by stating that
the provisions in CAA section 126 apply to source emissions regardless
of state boundaries, thereby better reflecting the science of air
pollution transport and allowing a state to petition for, were the EPA
to grant the petition, the application of emissions reductions
requirements to a group of stationary sources located in multiple
upwind states.
    A second commenter notes that the EPA's use of the four-step
interstate transport within CAA section 126(b) does not facilitate the
application of the CAA section 126(b) petition mechanism as intended,
which the commenter articulates as including the use of such petitions
and the EPA's action thereupon as a precise tool to control specific
sources (e.g., EGUs), potentially through the imposition of emissions
limits including shorter averaging times. The commenter notes that the
good neighbor provision, as the EPA has historically implemented it,
relies on regional trading programs and robust emissions allowance
pools, which do not guarantee control of emissions from nearby, upwind
sources on high electric demand days that are most conducive to
downwind ozone formulation.
    The EPA disagrees with commenters who assert that its application
of the four-step interstate transport framework used to address
requirements under the good neighbor provision is not appropriate to
address CAA section 126(b) petitions. While either CAA section 126(b)
or CAA section 110(a)(2)(D)(i)(I) may be applied to address interstate
transport, as discussed in Section III.B, the cross-reference in CAA
section 126(b) to the prohibition in CAA section 110(a)(2)(D)(i) means
that the same substantive standard is used to determine whether there
is a violation under either section and, therefore, whether emissions
should be prohibited in either a good neighbor SIP or in a finding
under CAA section 126(b). Moreover, the EPA also believes its use of
the four-step interstate transport framework to evaluate a CAA section
126(b) petition continues to be technically justified, especially as it
applies to New York's petition addressing the impacts of hundreds of
sources to alleged ozone nonattainment downwind.
    As discussed earlier, the EPA agrees with commenters that ozone
nonattainment problems result from the cumulative air quality impacts
of relatively smaller contributions from numerous anthropogenic sources
across several upwind states (as well as from within the downwind
state). Thus, evaluating which upwind states and sources should be held
responsible for addressing downwind nonattainment presents a ``thorny
causation problem.'' EME Homer City, 572 U.S. at 514. This is true
whether the EPA is evaluating the problem in the context of reviewing a
SIP or promulgating a FIP under CAA section 110(a)(2)(D)(i)(I) or in
the context of evaluating a petition targeting individual sources under
CAA section 126(b). The four-step interstate transport framework
provides a reasonable approach to identifying which upwind states and
sources among many should bear the responsibility for implementing
emissions reductions to benefit downwind air quality.
    Thus, the EPA disagrees with commenters asserting that application
of a statewide air quality threshold at step 2 is inappropriate under
CAA section 126(b). First, as discussed further in Section III.C of
this notification, while the EPA is not taking a position regarding
what air quality threshold is most appropriately applied with respect
to the 2015 ozone NAAQS, the EPA agrees that its modeling shows that
upwind states named in the petition are all linked to a projected air
quality problem in the NYMA using the 1 percent threshold that the EPA
has used in other recent rulemakings to evaluate step 2 linkages.
Accordingly, although the EPA is not here deciding whether the 1
percent threshold is the only appropriate screening level that might be
applied for good neighbor analysis for the 2015 ozone NAAQS in other
contexts (such as the EPA's review of SIP submissions \29\ addressing
2015 ozone NAAQS good neighbor obligations), the EPA has not proposed
to deny the petition on the basis of any analysis at step 2, and the
commenter's concern that the use of any statewide air quality threshold
is ill-suited to a CAA section 126(b) petition is not raised in this
action.
---------------------------------------------------------------------------

    \29\ See Analysis of Contribution Thresholds for Use in Clean
Air Act Section 110(a)(2)(D)(i)(I) Interstate Transport State
Implementation Plan Submissions for the 2015 Ozone National Ambient
Air Quality Standards (August 2018) (providing analysis to support
potential use of a 1 ppb threshold in the development of good
neighbor SIPs for the 2015 ozone NAAQS). Available at https://www.epa.gov/sites/production/files/2018-09/documents/contrib_thresholds_transport_sip_subm_2015_ozone_memo_08_31_18.pdf.
---------------------------------------------------------------------------

    The EPA further notes that both New York's petition and the
commenters conflate the EPA's use of an air quality threshold at step 2
with the full analysis used under the four-step interstate transport
framework as a whole for apportioning responsibility for emissions
reductions among upwind states and sources. New York's CAA section
126(b) petition uses a 1 percent threshold to identify states that are
linked to the downwind air quality problems and asserts that all the
emissions from the named sources that collectively exceed 1 percent are
deemed significant. However, this

misunderstands the EPA's use of the air quality threshold in the
context of the four-step interstate transport framework. If an upwind
state's air quality impact to an identified downwind air quality
problem exceeds the threshold as determined at step 2, the EPA then
turns to the evaluation of additional cost and air quality factors at
step 3 to determine what amount of emissions, if any, from an upwind
state should be considered to significantly contribute to the downwind
air quality problems. If the collective air quality contribution does
not exceed the threshold, then emissions from within the state are
considered not to significantly contribute to the downwind air quality
problem. Thus, the EPA reasonably uses an air quality threshold at step
2 of the four-step interstate transport framework as one aspect of the
resolution of the ``thorny causation'' problem by identifying which
states' collective impact is sufficiently large to merit further review
of the emissions reduction potential at sources within the state. As
the cumulative nature of the ozone problem remains the same whether
evaluated under CAA section 110(a)(2)(D)(i)(I) or section 126(b), the
EPA believes that it is reasonable to apply a statewide air quality
threshold in this case as in the four-step interstate transport
framework that it has historically used to implement the good neighbor
provision.
    The EPA also disagrees that its use of the four-step interstate
transport framework precludes the targeted, source-specific remedy
provided for by CAA section 126(c). Although the EPA has used regional
trading programs to address good neighbor obligations in past
rulemakings under both CAA section 110(a)(2)(D)(i)(I) and CAA section
126(b), the application of the framework does not dictate that the
remedy at step 4 necessarily be implemented in a particular manner.
Thus, the four-step interstate transport framework can be applied in
the context of CAA section 126(b) to determine whether a source is
operating in violation of the good neighbor provision with sufficient
flexibility to permit the application of an appropriately demonstrated
remedy under CAA section 126(c), whether through a regional trading
program or source-specific emissions limits.

B. The EPA's Standard of Review for This CAA Section 126(b) Petition
Regarding the 2008 and 2015 8-Hour Ozone NAAQS

    As discussed in Section II.B of this action, section 126(b) of the
CAA provides a mechanism for states and other political subdivisions to
seek abatement of pollution in other states that may be affecting their
air quality. CAA section 126(b) does not, however, identify a specific
methodology or specific criteria for the Administrator to apply when
making a CAA section 126(b) finding or denying a petition. Therefore,
the EPA has the discretion to identify relevant criteria and develop a
reasonable approach for evaluating a CAA section 126(b) petition. See,
e.g., Chevron, U.S.A., Inc. v. NRDC, 467 U.S. 837, 842-43 (1984);
Smiley v. Citibank, 517 U.S. 735, 744-45 (1996).
    With respect to the statutory requirements of section 126 and
section 110(a)(2)(D)(i) of the CAA, the EPA has consistently
acknowledged that Congress created these provisions as two independent
statutory tools to address the problem of interstate pollution
transport. See, e.g., 76 FR 69052, 69054 (November 7, 2011).\30\ The
fact that Congress did not indicate any preference for one over the
other suggests that either tool could serve as a legitimate means to
produce the desired result, which is to mitigate significant
contribution to nonattainment and interference with maintenance of the
NAAQS in downwind states. While the provisions in CAA section
110(a)(2)(D)(i) and section 126 are independent, they are also closely
linked. 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,
accordingly, both provisions are reasonably interpreted to construe
significant contribution to nonattainment and interference with
maintenance identically, since the identical terms are naturally
interpreted as meaning the same thing in the two linked provisions. See
Appalachian Power, 249 F. 3d at 1049-50.
---------------------------------------------------------------------------

    \30\ Courts have also upheld the EPA's position that CAA
sections 110(a)(2)(D)(i) and section 126 are two independent
statutory tools to address the same problem of interstate transport.
See GenOn REMA, LLC v. EPA, 722 F.3d 513, 520-23 (3d Cir. 2013);
Appalachian Power, 249 F.3d at 1047.
---------------------------------------------------------------------------

    Thus, in addressing a CAA section 126(b) petition for ozone
transport, the EPA believes it is appropriate to interpret the
ambiguous terms incorporated by the cross-reference to CAA section
110(a)(2)(D)(i) (i.e., ``contribute significantly to nonattainment''
and ``interfere with maintenance'') \31\ consistent with the EPA's past
approach to evaluating interstate ozone pollution transport under the
good neighbor provision, and its interpretation and application of that
related provision of the statute. As previously discussed, ozone is a
regional air pollutant and the EPA's previous analyses and regulatory
actions have evaluated the regional interstate ozone transport problem
using the four-step interstate transport framework. The EPA most
recently applied this four-step interstate transport framework in
promulgating the CSAPR Update and the Determination Rule to address
interstate transport with respect to the 2008 ozone NAAQS under CAA
section 110(a)(2)(D)(i)(I). This approach is particularly applicable
with respect to New York's claims regarding the 2008 ozone NAAQS
because both rulemakings address projected air quality problems in New
York and the impacts of upwind states, including those named in the
petition, on such areas.\32\ Given the specific cross-reference in CAA
section 126(b) to the substantive prohibition in CAA section
110(a)(2)(D)(i), the EPA believes any prior findings made under the
good neighbor provision are informative--if not determinative--for a
CAA section 126(b) action. Therefore, in this instance, the EPA's
decision whether to grant or deny the CAA section 126(b) petition
regarding the 2008 8-hour ozone NAAQS depends on application of the
four-step interstate transport framework.
---------------------------------------------------------------------------

    \31\ The Supreme Court confirmed that these terms are ambiguous
in EME Homer City and that the EPA is therefore delegated the
authority to reasonably interpret the provisions. 572 U.S. at 514-15
n.18.
    \32\ The EPA similarly evaluated the impact of Kentucky on New
York's air quality after implementation of the CSAPR Update in
approving the former state's SIP submission and concluded Kentucky's
good neighbor obligations for the 2008 ozone NAAQS were fully
addressed by the CSAPR Update. 83 FR 33730 (July 17, 2018). No legal
challenges to the EPA's determinations in that SIP action were filed
within the period for judicial review.
---------------------------------------------------------------------------

    While the EPA previously applied the four-step interstate transport
framework and interpreted significant contribution and interference
with maintenance under CAA section 110(a)(2)(D)(i) for the 2008 ozone
NAAQS via the CSAPR Update and the Determination Rule, the EPA has not
engaged in a regional rulemaking action to apply the good neighbor
provision for the 2015 ozone NAAQS. However, the EPA has released
technical information intended to inform states' development of SIPs to
address the 2015 ozone standard.\33\ This information included the
results of air quality modeling to identify potential downwind air
quality problems in 2023, which we discuss in more detail in

Section III.C.1 of this document. As part of the memorandum releasing
the technical information, the EPA acknowledged that states have the
flexibility to pursue approaches that may differ from the EPA's
historical approach to evaluating interstate transport in developing
their good neighbor SIPs.\34\ Nonetheless, the EPA's technical analysis
and the potential flexibilities identified in the memorandum generally
followed the basic elements of the EPA's historical four-step
interstate transport framework. As described previously, CAA section
126(b) does not identify a specific methodology or specific criteria
for the Administrator to apply when making a CAA section 126(b) finding
or denying a petition. Thus, given the EPA's discretion to identify
relevant criteria and develop a reasonable approach to inform a CAA
section 126(b) finding, the EPA believes that it continues to be
appropriate for the Agency to evaluate the claims regarding the 2015
ozone NAAQS in New York's CAA section 126(b) petition consistent with
the EPA's four-step interstate transport framework used to evaluate
other ozone NAAQS.
---------------------------------------------------------------------------

    \33\ See Information on the Interstate Transport State
Implementation Plan Submissions for the 2015 Ozone National Ambient
Air Quality Standards under Clean Air Act Section 110(a)(2)(D)(i)(I)
(March 27, 2018).
    \34\ The EPA has also released two additional memoranda
providing guidance to states developing good neighbor SIPs for the
2015 ozone NAAQS. See Analysis of Contribution Thresholds for Use in
Clean Air Act Section 110(a)(2)(D)(i)(I) Interstate Transport State
Implementation Plan Submissions for the 2015 Ozone National Ambient
Air Quality Standards (August 31, 2018); and Considerations for
Identifying Maintenance Receptors for Use in Clean Air Act Section
110(a)(2)(D)(i)(I) Interstate Transport State Implementation Plan
Submissions for the 2015 Ozone National Ambient Air Quality
Standards (October 19, 2018). All three memoranda are available in
the docket for this final action and at https://www.epa.gov/airmarkets/memo-and-supplemental-information-regarding-interstate-transport-sips-2015-ozone-naaqs.
---------------------------------------------------------------------------

    Accordingly, because the EPA interprets ``contribute significantly
to nonattainment'' and ``interfere with maintenance'' to mean the same
thing under both CAA sections 110(a)(2)(D)(i)(I) and 126(b), the EPA's
decision whether to grant or deny a CAA section 126(b) petition
regarding both the 2008 and 2015 ozone NAAQS depends on application of
the analysis used to address CAA section 110(a)(2)(D)(i)(I). That is,
the EPA assesses whether there is a downwind air quality problem in the
petitioning state (i.e., step 1 of the four-step interstate transport
framework); whether the upwind state where the source subject to the
petition is located is linked to the downwind air quality problem
(i.e., step 2); and, if such a linkage exists, whether (balancing
various cost and air quality factors) there are cost-effective
emissions reductions available from sources in the upwind state to
support a conclusion that the sources in the state significantly
contribute to nonattainment or interfere with maintenance of the NAAQS
(i.e., step 3). If the EPA makes a CAA section 126(b) finding based on
its determination that a source or sources will significantly
contribute to nonattainment or interfere with maintenance, then the EPA
will implement a remedy under CAA section 126(c) to ensure that the
violation of the good neighbor provision is addressed through permanent
and enforceable measures (i.e., step 4).
    In interpreting the phrase ``emits or would emit in violation of
the prohibition of section [110(a)(2)(D)(i)],'' if the EPA or a state
has already adopted provisions that eliminate the significant
contribution to nonattainment or interference with maintenance of the
NAAQS in downwind states, then there simply is no violation of the CAA
section 110(a)(2)(D)(i)(I) prohibition. Stated another way, requiring
additional reductions from upwind sources would result in eliminating
emissions that do not contribute significantly to nonattainment or
interfere with maintenance of the NAAQS. Such an action is beyond the
scope of the prohibition in CAA section 110(a)(2)(D)(i)(I) and,
therefore, beyond the scope of the EPA's authority to make the
requested finding under CAA section 126(b). See EME Homer City, 572
U.S. at 515 n.18, 521-22 (holding the EPA may not require sources in
upwind states to reduce emissions by more than necessary to eliminate
significant contribution to nonattainment or interference with
maintenance of the NAAQS in downwind states under the good neighbor
provision).
    Thus, it follows that if the EPA approved a state's SIP as
adequately meeting the requirements of CAA section 110(a)(2)(D)(i)(I)
for a specific NAAQS, the EPA would not find that a source in that
state was emitting in violation of the prohibition of CAA section
110(a)(2)(D)(i)(I) absent new information demonstrating that the SIP is
now insufficient to address the prohibition for that NAAQS. Similarly,
if the EPA has promulgated a FIP that fully eliminates emissions that
significantly contribute to nonattainment or interfere with maintenance
in a downwind state for a specific NAAQS, the EPA has no basis to find
that sources in the upwind state are emitting or would emit in
violation of the CAA section 110(a)(2)(D)(i)(I) prohibition, absent new
information to the contrary for that NAAQS.
    The EPA notes that the approval of a SIP or promulgation of a FIP
implementing CAA section 110(a)(2)(D)(i)(I) constitutes a determination
that a state's emissions are adequately controlled considering the
specific facts that the EPA analyzed while approving the SIP or
promulgating the FIP. If a petitioner produces new data or information
showing a different level of contribution or other facts the EPA did
not consider when approving the SIP or promulgating the FIP, compliance
with a SIP or FIP may not be determinative regarding whether the upwind
sources emit or would emit in violation of the prohibition of CAA
section 110(a)(2)(D)(i)(I). See 64 FR 28250, 28274 n.15 (May 25, 1999);
71 FR 25328, 25336 n.6 (April 28, 2006); Appalachian Power, 249 F.3d at
1067 (later developments can be the basis for another CAA section 126
petition). Thus, in circumstances where a state is implementing a SIP
or the EPA is implementing a FIP addressing CAA section
110(a)(2)(D)(i)(I) for a particular NAAQS, the EPA will evaluate the
CAA section 126(b) petition to determine if the submitted petition
raises new information that merits further consideration.
    Turning to the comments on the EPA's proposed standard of review,
several commenters took issue with the EPA's application of the four-
step interstate transport framework under CAA section 126, arguing that
in doing so the EPA is ``unlawfully eliminating [CAA] section 126 as an
independent statutory tool for downwind states.'' Commenters disagreed
with the EPA's interpretation of the relationship between the good
neighbor provision under CAA sections 110(a)(2)(D)(i)(I) and 126(b),
contending that Congress intended CAA section 126(b) petitions to be a
legal tool to address interstate problems separate and distinct from
SIP and FIP actions under CAA section 110. Commenters cite to
legislative history and the Third Circuit's opinion in GenOn, 722 F.3d
at 520-23, in support of their assertions that CAA section 126 is
intended to remedy interstate transport problems notwithstanding the
existence of CAA section 110. Commenters accordingly assert the EPA is
incorrect in determining that its four-step interstate transport
approach under CAA section 110(a)(2)(D)(i)(I) is appropriate for
evaluating under CAA section 126(b) whether an upwind source or group
of sources will significantly contribute to nonattainment or interfere
with

maintenance of the 2008 and the 2015 ozone NAAQS in a petitioning
downwind state.
    The EPA has consistently acknowledged in prior actions under CAA
section 126(b) that Congress created the good neighbor provision and
CAA section 126 as two independent statutory processes to address one
problem: Interstate pollution transport. See, e.g., 83 FR 26666, 26675
(June 8, 2018) (proposal for this final action); 76 FR 69052, 69054
(November 7, 2011) (proposed action for the EPA's final action on New
Jersey's CAA section 126(b) petition regarding SO2 emissions
from Portland Generating Station). As the commenters point out, the
Third Circuit has upheld the EPA's position that CAA sections
110(a)(2)(D)(i) and 126 are two independent statutory processes to
address the same problem of interstate transport. See GenOn, 722 F.3d
at 520-23. However, the commenters misread the court's holding
regarding the EPA's interpretation of the interplay between the two
provisions. The Third Circuit spoke to the question of the timing and
sequence of these processes--specifically, whether the EPA could act on
a CAA section 126(b) petition in instances where the Agency had not yet
acted on a CAA section 110 SIP addressing interstate transport for the
same NAAQS. The Third Circuit also cited to a similar holding by the
D.C. Circuit in Appalachian Power. Appalachian Power, 249 F.3d at 1047.
Both courts upheld the EPA's position that it need not wait for the CAA
section 110 process to conclude before acting on a CAA section 126(b)
petition, thus affirming that both statutory provisions are independent
from one another from a timing perspective. But neither court held that
the EPA was precluded from applying the same analytical framework to
resolving CAA section 126(b) petitions as it applies to analyze states'
good neighbor obligations. Here, the Agency has not deferred action on
New York's petition regarding the 2015 ozone NAAQS, for which good
neighbor SIPs were due on October 1, 2018, until its action on the good
neighbor SIPs (for the named upwind states) has concluded. Therefore,
by acting on New York's CAA section 126(b) petition regarding the 2015
ozone NAAQS before concluding action on CAA section 110 SIPs, the EPA
believes it has given CAA section 126(b) independent meaning as
intended by Congress and the courts.
    Moreover, the D.C. Circuit's opinion in Appalachian Power further
supports the EPA's interpretation taken in this action: That while the
Agency need not wait for the CAA section 110 process to conclude before
acting on a CAA section 126(b) petition, the EPA reasonably imported
the four-step interstate transport framework under CAA section 110 to
CAA section 126 by interpreting the substantive requirements of the two
provisions to be closely linked. The court in Appalachian Power
specifically considered whether it was appropriate for the EPA to rely
on findings made under the good neighbor provision in the
NOX SIP Call rulemaking in granting several CAA section
126(b) petitions raising similar interstate transport concerns with
regards to the same NAAQS. Petitioners in that case argued that the EPA
should instead make a finding that ``the specified stationary sources
within a given state independently met [the statute's] threshold test
for effect on downwind nonattainment.'' 249 F.3d at 1049. The court
found that by referring to stationary sources that emit pollutants ``in
violation of the prohibition of [CAA section 110(a)(2)(D)(i)],''
Congress ``clearly hinged the meaning of [CAA] section 126 on that of
section 110(a)(2)(D)(i).'' Id. at 1050. The court, therefore, concluded
that given CAA section 126's silence on what it means for a stationary
source to violate CAA section 110(a)(2)(D)(i), the EPA's approach of
relying on findings under CAA section 110(a)(2)(D)(i) was reasonable
and, therefore, entitled to deference under Chevron, 467 U.S. at 843.
See Appalachian Power, 249 F.3d at 1050. The EPA's approach to
addressing New York's CAA section 126(b) petition through the
application of the four-step interstate transport framework and
consideration of findings made in the CSAPR Update and the
Determination Rule is therefore reasonable and consistent with prior
case law.
    Several commenters assert that the EPA cannot rely on recent
regional transport rulemakings because they did not fully address good
neighbor obligations. Commenters assert that the existence of the CSAPR
Update does not foreclose a state from seeking--or the EPA from
providing--redress under CAA section 126(b) when the state finds itself
struggling to meet NAAQS due to significant upwind contributions or
interference. When the EPA promulgated the CSAPR Update it explicitly
noted that it only served as a ``partial remedy'' as to the 2008 ozone
NAAQS. Commenters argue that the fact that New York is continuing to
experience challenges attaining the 2008 ozone NAAQS demonstrates that
significant interstate pollution and associated attainment difficulties
remain after the implementation of the CSAPR Update. Commenters
therefore assert that the EPA's reliance on the Determination Rule as a
complete remedy with respect to the 2008 ozone NAAQS is arbitrary and
capricious because the rule fails to eliminate current and ongoing
significant contributions by upwind states and sources.
    The EPA agrees that the existence of the CSAPR Update does not
foreclose redress under CAA section 126(b), but the commenters misstate
the EPA's basis for evaluating the petition in light of the CSAPR
Update. Although the EPA explained in the proposal that the
Determination Rule concluded that the emissions reductions required by
the CSAPR Update would fully address covered states' good neighbor
obligations for the 2008 ozone NAAQS, the EPA did not rely on these
rules (i.e., the CSAPR Update and the Determination Rule) alone to
propose denial of the petition.\35\ Rather, as described in more detail
in Section III.C below, the EPA has reviewed the petition consistent
with its interpretation of CAA section 126(b) and the good neighbor
provision to see if additional information that was not previously
considered by the EPA in either the CSAPR Update or the Determination
Rule would justify imposing the additional control requirements that
New York requested. As described in Section III.C, the EPA specifically
considered the relevance of current air quality in New York. However,
based on its evaluation of the information provided in the petition,
the EPA has found that the petitioner has not satisfied its burden to
demonstrate that the sources named in the petition emit or would emit
in violation of the good neighbor provision with respect to either the
2008 or 2015 ozone NAAQS.
---------------------------------------------------------------------------

    \35\ Similar to Kentucky, the EPA did not rely on its approval
of the State's SIP alone to propose denial as to the sources named
in that state but considered whether the petition raised new
information not previously considered in that action.
---------------------------------------------------------------------------

C. The EPA's Evaluation of Whether the Petition Is Sufficient To
Support a CAA Section 126(b) Finding

    This section discusses the approach that the EPA used to review the
sufficiency of New York's CAA section 126(b) petition and the EPA's
resulting determination that New York has not provided an adequate
technical and analytic basis for the EPA to make a finding nor does the
EPA have available information to support such a finding.
    Consistent with the EPA's approach to evaluating several prior CAA
section

126(b) petitions, the EPA interprets CAA section 126(b) as placing an
burden on the petitioner to establish a technical and analytic basis
for the specific finding requested. Thus, the EPA first looks to see if
the petition identifies or contains a sufficient basis to make the
requested finding. See, e.g., 76 FR 19662, 19666 (April 7, 2011)
(proposed response to petition from New Jersey regarding SO2
emissions from the Portland Generating Station); 83 FR 16064, 16070
(April 13, 2018) (final response to petition from Connecticut regarding
ozone emissions from the Brunner Island Steam Electric Station); 83 FR
50444, 50452 (October 5, 2018) (final response to petitions from
Delaware and Maryland regarding ozone emissions from four EGU
facilities and 36 individual EGUs, respectively).\36\
---------------------------------------------------------------------------

    \36\ The EPA's response to the Maryland and Delaware petition is
currently subject to judicial review in the D.C. Circuit. Maryland
v. EPA, No. 18-1285 (D.C. Cir. filed October 15, 2018).
---------------------------------------------------------------------------

    While the EPA interprets CAA section 126(b) as putting the burden
on the petitioner, rather than the EPA, to provide a basis or
justification for making the requested finding, nothing precludes the
EPA from choosing to conduct an independent analysis on a discretionary
basis when the Agency determines it would be helpful in evaluating a
petition. The EPA has chosen to invoke its discretion in prior actions
on CAA section 126(b) petitions concerning ozone, primarily where the
Agency already had technical data or findings it could rely on as part
of its independent analysis. Notably, because the supplemental
information already existed at the time the EPA acted on those
petitions, the EPA could leverage such information in its action
without undertaking new analyses that would naturally take
significantly more time and resources to develop.\37\ Consistent with
this position and as described further in this section of the
notification, the EPA is using supplemental information, when currently
available, as part of its discretionary independent analysis of New
York's CAA section 126(b) petition. The results of the following
analysis support the EPA's determination that New York has not provided
an adequate technical and analytic basis for the EPA to make a finding,
nor does the EPA's analysis of supplemental information available to it
outside of the basis that New York has provided support such a finding.
---------------------------------------------------------------------------

    \37\ See 83 FR 16064 (April 13, 2018); 83 FR 50444 (October 5,
2018).
---------------------------------------------------------------------------

1. The EPA's Evaluation of New York's Petition Considering Step 1
    As discussed in Section IV.B.1 of the proposal, with respect to
step 1 of the four-step interstate transport framework, the EPA began
by evaluating New York's petition to determine whether the State
identified a downwind air quality problem (nonattainment or
maintenance) that may be impacted by ozone transport from other states.
The EPA conducted this evaluation for Chautauqua County and the NYMA
regarding both the 2008 and 2015 ozone NAAQS.
    As discussed in Section II.C of this notification, the EPA
typically focuses its analysis regarding potential downwind air quality
problems on a future analytic year given the forward-looking nature of
the good neighbor obligation in CAA section 110(a)(2)(D)(i)(I). The
good neighbor provision requires that states prohibit emissions that
``will'' significantly contribute to nonattainment or interfere with
maintenance of the NAAQS in any other state. The EPA reasonably
interprets this language as permitting states and the EPA in
implementing the good neighbor provision to prospectively evaluate
downwind air quality problems and the need for further upwind emissions
reductions.
    Particularly relevant to this action, the EPA also applied this
interpretation of ``will'' in the Determination Rule to evaluate
remaining good neighbor obligations with respect to the 2008 ozone
NAAQS for the CSAPR Update states, including the nine upwind states
cited in New York's petition. 83 FR 65889-90. As explained in that
action, a key decision informing the application of the interstate
transport framework is the selection of a future analytic year. Several
court decisions have guided the factors that the EPA considers in
selecting an appropriate future analytic year for such an analysis.
First, in North Carolina, the D.C. Circuit held that the timeframe for
implementation of emissions reductions required by the good neighbor
provision should be selected by considering the relevant attainment
dates of downwind nonattainment areas affected by interstate transport
of air pollution. 531 F.3d at 911-12. Moreover, the Supreme Court and
the D.C. Circuit have both held that the EPA may not over-control
upwind state emissions relative to the downwind air quality problems.
Specifically, the courts found that the Agency may not require
emissions reductions (at steps 3 and 4 of the interstate transport
framework) from a state that are greater than necessary to achieve
attainment and maintenance of the NAAQS in all the downwind areas to
which that state is linked. See EME Homer City, 572 U.S. at 521-22; EME
Homer City II, 795 F.3d at 127, 129-30 (on remand from the Supreme
Court, finding ozone-season NOX budgets for ten states
invalid because the EPA's modeling showed that the downwind air quality
problems to which these states were linked would be resolved by the
time the budgets would be implemented). These court decisions support
the Agency's choice to use a future analytic year to help ensure that
any emissions reductions that the EPA may require of sources in upwind
states neither over- or under-control emissions with respect to the
EPA's projections as to downwind air quality at the time by which that
those controls could feasibly be implemented.
    In the Determination Rule, the EPA established the appropriate
future analytic year for purposes of assessing remaining interstate
transport obligations for the 2008 ozone NAAQS. 83 FR 65889-890. The
EPA's analysis considered two primary factors: (1) The applicable
attainment dates for the 2008 ozone NAAQS; and (2) the timing to
feasibly implement new NOX control strategies not previously
addressed in the CSAPR Update. As the applicable attainment dates, the
EPA explained that the next attainment dates for the 2008 ozone NAAQS
would be July 20, 2021, for nonattainment areas classified as Serious,
and July 20, 2027, for nonattainment areas classified as Severe.
    In the Determination Rule, the EPA then evaluated the timeframe
necessary to implement additional NOX control strategies at
various sources across the region. 83 FR 65893-901. For EGUs, the EPA
explained that it was appropriate to consider the timeframe required
for implementation of selective catalytic reduction (SCR) across the
region because of the potential for larger emissions reductions as
compared to selective non-catalytic reduction (SNCR). The EPA
determined that SCR project development and installation can require up
to 39 months for an individual power plant installing controls on more
than one boiler,\38\ and that a minimum of 48 months (4 years) is a
reasonable time-period needed to complete all necessary steps of SCR
projects at EGUs on a regional scale, considering the necessary stages
of post-

combustion control project planning, shepherding of labor and material
supply, installation, coordination of outages, testing, and operation.
The EPA further concluded that SNCR installations, while generally
having shorter project timeframes (i.e., up to 16 months for an
individual power plant installing controls on more than one boiler),
share similar implementation steps with and need to account for the
same regional factors as SCR installations.\39\ The EPA, therefore,
concluded that it may reasonably take up to 4 years to install the new
emissions controls regionwide for EGUs.
---------------------------------------------------------------------------

    \38\ See Table 3-1 in Engineering and Economic Factors Affecting
the Installation of Control Technologies for Multipollutant
Strategies. EPA Final Report. EPA-600/R-02/073. October 2002.
Available at https://cfpub.epa.gov/si/si_public_record_report.cfm?Lab=NRMRL&dirEntryId=63473.
    \39\ See the month-by-month evaluation of SNCR installation
presented in Exhibit A-6 in Engineering and Economic Factors
Affecting the Installation of Control Technologies for
Multipollutant Strategies. EPA Final Report. EPA-600/R-02/073.
October 2002. Available at https://cfpub.epa.gov/si/si_public_record_report.cfm?Lab=NRMRL&dirEntryId=63473. Evaluation
of implementation timeframes for various control strategies is also
found in the EPA's CSAPR Update EGU NOX Mitigation
Strategies Final Rule TSD. See Docket ID No. EPA-HQ-OAR-2015-0500
(available at http://www.regulations.gov).
---------------------------------------------------------------------------

    The EPA further explained that many of the same considerations
affecting the EPA's analysis of regionwide implementation of controls
at EGUs would also affect the regionwide implementation of controls at
non-EGUs, which may be more complex considering the diversity of non-
EGU sources as well as the greater number and smaller size of the
individual sources. 83 FR 65901-04. The EPA noted that preliminary
estimates for the implementation of some potential control technologies
on non-EGUs only account for the time between bid evaluation and
startup but do not account for additional considerations such as pre-
bid evaluation studies, permitting, and installation of monitoring
equipment. In addition, these preliminary estimates for implementing
control technologies do not include the time and resources needed to
install such technologies on a sector- or region-wide basis.
Accordingly, the EPA concluded that it was reasonable to assume for
purposes of the Determination Rule that an expeditious timeframe for
installing sector- or region-wide controls on non-EGU sources could
also be 4 years or more.
    Considering the timeframes for regionwide implementation of control
strategies and the timeframe in which a rulemaking requiring such
controls would be finalized, the EPA concluded that reductions from
such control strategies were unlikely to be implemented for a full
ozone season until 2023. The EPA acknowledged that 2023 is later than
the attainment date for nonattainment areas classified as Serious (July
20, 2021), but concluded that it was unlikely emissions control
requirements could be feasibly promulgated and implemented by that
earlier date. Moreover, the EPA noted that 2023 was well in advance of
the subsequent attainment date for areas classified as Severe.
Accordingly, the EPA determined that 2023 was a reasonable year to
assess downwind air quality to evaluate any remaining requirements
under the good neighbor provision for the 2008 ozone NAAQS. 83 FR
65901-05.
    After selecting the analytic year, the EPA then used the
Comprehensive Air Quality Model with Extensions (CAMx v6.40) to model
emissions in 2011 and 2023, based on updates provided to the EPA from
states and other stakeholders on a January 6, 2017, Notice of Data
Availability (NODA).40 41 This updated modeling was used in
the Determination Rule to estimate ozone design values in 2023, as
described in the Determination Rule Air Quality Modeling Technical
Support Document (TSD).\42\ The EPA used outputs from the 2011 and 2023
model simulations to project base period 2009-2013 average and maximum
ozone design values to 2023 at monitoring sites nationwide. In
projecting future year design values, the EPA applied its own modeling
guidance,\43\ which recommends using model predictions from the ``3 x
3'' array of grid cells surrounding the location of the monitoring
site.\44\ Considering the comments on the January 2017 NODA and other
analyses, the EPA also projected 2023 design values based on a modified
version of the ``3 x 3'' approach for those monitoring sites located in
coastal areas. Briefly, in this alternative approach, the EPA
eliminated from the design value calculations those modeling data in
grid cells that are dominated by water (i.e., more than 50 percent of
the area in the grid cell is water) and that do not contain a
monitoring site (i.e., if a grid cell is more than 50 percent water but
contains an air quality monitor, that cell would remain in the
calculation).\45\ For each individual monitoring site, the base period
2009-2013 average and maximum design values, and the 2023 projected
average and maximum design values (based on both the ``3 x 3'' approach
and the alternative approach) affecting coastal sites are available in
Excel format in the docket for this action and in PDF format at https://www.epa.gov/airmarkets/memo-supplemental-information-interstate-transport-sips-2008-ozone-naaqs.
---------------------------------------------------------------------------

    \40\ Using the 2023 analytic year also allowed the EPA to begin
the updated analysis using the data sets originally developed for a
January 2017 Notice of Data Availability (NODA) (82 FR 1733, January
6, 2017), which the EPA revised in response to stakeholder feedback.
Accordingly, the EPA initiated its analysis more quickly than if a
different year had been chosen, which might have delayed subsequent
rulemaking actions and therefore emissions reductions.
    \41\ See Notice of Availability of the Environmental Protection
Agency's Preliminary Interstate Ozone Transport Modeling Data for
the 2015 Ozone National Ambient Air Quality Standard (NAAQS), 82 FR
1733 (January 6, 2017). This memorandum also supplements the
information provided in, ``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).'' Memorandum from Stephen D. Page,
Director, U.S. EPA Office of Air Quality Planning and Standards, to
Regional Air Division Directors, Regions 1-10. October 27, 2017.
Available at https://www.epa.gov/sites/production/files/2017-10/documents/final_2008_o3_naaqs_transport_memo_10-27-17b.pdf.
    \42\ Air Quality Modeling Technical Support Document for the
Updated 2023 Projected Ozone Design Values. U.S. EPA Office of Air
Quality Planning and Standards. June 2018. Document developed to
support the Determination Rule, 83 FR 65878 (December 21, 2018).
Available at https://www.epa.gov/airmarkets/air-quality-modeling-technical-support-document-updated-2023-projected-ozone-design.
    \43\ ``Draft Modeling Guidance for Demonstrating Attainment of
Air Quality Goals for Ozone, PM2.5, and Regional Haze.''
Memorandum from Richard Wayland, Division Director, Air Quality
Assessment Division, U.S. EPA Office of Air Quality Planning and
Standards, to Regional Air Division Directors, Regions 1-10.
December 3, 2014. Available at https://www3.epa.gov/scram001/guidance/guide/Draft-O3-PM-RH-Modeling_Guidance-2014.pdf.
    \44\ The EPA's modeling uses 12km\2\ grid cells.
    \45\ A model grid cell is identified as a ``water'' cell if more
than 50 percent of the grid cell is water based on the 2006 National
Land Cover Database. Grid cells that meet this criterion are treated
as entirely over water in the WRF modeling used to develop the 2011
meteorology for the EPA's air quality modeling. (See Air Quality
Modeling Technical Support Document for the Updated 2023 Projected
Ozone Design Values. U.S. EPA Office of Air Quality Planning and
Standards. June 2018. Document developed to support the
Determination Rule, 83 FR 65878 (December 21, 2018). Available at
https://www.epa.gov/airmarkets/air-quality-modeling-technical-support-document-updated-2023-projected-ozone-design.)
---------------------------------------------------------------------------

    In the Determination Rule, the EPA followed the same approach for
identifying receptors based on this modeling as in the CSAPR Update
rulemaking process. That is, the EPA considered a combination of
modeling projections and monitoring data to identify receptor sites
that are projected to have problems attaining or maintaining the
NAAQS.\46\ Specifically, the EPA identified nonattainment receptors as
those monitoring sites with current measured values exceeding the NAAQS
that also have projected (i.e., in 2023) average design values
exceeding the NAAQS. The EPA also identified maintenance receptors as
those

monitoring sites with projected maximum design values exceeding the
NAAQS. Specifically, maintenance receptors included sites with current
measured values below the NAAQS with projected average and maximum
design values exceeding the NAAQS and monitoring sites with projected
average design values below the NAAQS but with projected maximum design
values exceeding the NAAQS.
---------------------------------------------------------------------------

    \46\ See 81 FR 74530-74532 (October 26, 2016).
---------------------------------------------------------------------------

    Pertinent to this action, the EPA's examination in the
Determination Rule of the 2023 projected design values for Chautauqua
County indicates that this area is not projected to be in nonattainment
or have a maintenance problem in 2023 for either the 2008 or the 2015
ozone NAAQS. The EPA's examination of the 2023 projected design values
for the NYMA indicates that this area is not projected to be in
nonattainment or have a maintenance problem in 2023 for the 2008 ozone
NAAQS. However, the EPA's modeling indicates that the NYMA is projected
to be in nonattainment in 2023 with respect to the 2015 ozone NAAQS.
    Because the EPA has already conducted a rulemaking evaluating good
neighbor obligations for the 2008 ozone NAAQS under CAA section
110(a)(2)(D)(i)(I) in which the Agency used 2023 as the future analytic
year and because, as discussed previously, CAA section 126(b) directly
incorporates the CAA section 110(a)(2)(D)(i) standard, the EPA believes
it is also appropriate to consider the 2023 modeling conducted for the
Determination Rule in evaluating whether New York's petition has
adequately demonstrated that there will be a downwind air quality
problem with respect to the 2008 ozone NAAQS in Chautauqua County and
the NYMA.\47\ Moreover, the EPA believes it is appropriate to consider
the 2023 modeling when evaluating the petition's claims with respect to
the 2015 ozone NAAQS because the 2023 ozone season aligns with the
attainment year for the 2015 NAAQS in Moderate ozone nonattainment
areas, consistent with the D.C. Circuit's instruction in North
Carolina.\48\ As explained at proposal, while the EPA is not in this
action reopening the analysis and findings made in the Determination
Rule with respect to the 2008 ozone NAAQS, the EPA evaluated the
petition, consistent with the standard of review described in Section
III.B, to determine whether additional information not considered in
the Determination Rule should influence the EPA's finding as to whether
the sources named in New York's petition emit or would emit in
violation of the prohibition of CAA section 110(a)(2)(D)(i)(I).
---------------------------------------------------------------------------

    \47\ See n.1, supra, regarding the potential impact on this
final action of the September 13, 2019, decision of the D.C. Circuit
in Wisconsin v. EPA, No. 16-1406.
    \48\ The 2023 ozone season represents the last full season from
which data can be used to determine attainment with the 2015 ozone
NAAQS by the August 3, 2024, attainment date for nonattainment areas
classified as Moderate.
---------------------------------------------------------------------------

    The New York petition raises concerns about the assumptions and
results of the EPA's modeling. Specifically, the petition indicates
significant concerns with the EPA's expectation that uncontrolled EGUs
will reduce their emissions rates in the absence of unit-level
enforceable limits and with the EPA's treatment of model cells
containing a land/water interface. The petition does not further
elaborate on the basis for these concerns, and the EPA, therefore, has
no reason to believe that its 2023 modeling is unreliable. Moreover,
the EPA already addressed concerns regarding the EGU assumptions in the
2023 modeling in response to comments raised in the Determination Rule.
See 83 FR 65886-89 (explaining statutory rationale regarding when
enforceable emissions limitations are required and responding to
comments); 83 FR 65913-15 (responding to comments concerning
projections of EGU emissions in 2023).\49\
---------------------------------------------------------------------------

    \49\ The EPA's conclusions regarding the EGU assumptions in the
2023 modeling are also the subject of judicial review in the D.C.
Circuit. New York v. EPA, No. 19-1019 (D.C. Cir.).
---------------------------------------------------------------------------

    As described earlier in this section, the EPA also addressed
concerns regarding the treatment of model cells containing land/water
interface in the Determination Rule by calculating design values using
two different methodologies. 83 FR 65917. The petition does not provide
any new information not already considered by the EPA in the
Determination Rule as to these issues and therefore, the EPA has no
basis to reconsider its conclusions finalized in that action.
    The EPA received several comments challenging the conclusion that
it is appropriate to evaluate air quality in a future year to determine
whether there is a violation of the good neighbor provision in
evaluating New York's CAA section 126(b) petition. First, the EPA
received comments asserting that the EPA's reliance on the term
``will'' as it appears in the good neighbor provision to justify
consideration of air quality in a future year is inconsistent with the
plain language of the CAA. Commenters contend that Congress specified
that implementation plans under CAA section 110(a)(2)(D)(i) must
prohibit ``any'' pollution from ``any'' source that will contribute
significantly to nonattainment and interfere with maintenance, and that
this includes pollution that will do so between now and 2023.
    The EPA does not agree that analysis of air quality in a future
year is inconsistent with the statute. The EPA reasonably interprets
the word ``will'' in the good neighbor provision as permitting states
and the EPA in implementing the good neighbor provision to
prospectively evaluate downwind air quality problems and the need for
further upwind emissions reductions. In the EPA's prior regional
transport rulemakings, the Agency has routinely evaluated whether
upwind states ``will'' significantly contribute to nonattainment or
interfere with maintenance based on projections of air quality in the
future year in which any emissions reductions would be expected to go
into effect. For the 1998 NOX SIP Call, the EPA used an
analytic year of 2007. For the 2005 CAIR, the Agency used analytic
years of 2009 and 2010 for ozone and PM2.5, respectively. 63
FR 57450; 70 FR 25241. The EPA applied the same approach in finalizing
CSAPR in 2011, the CSAPR Update in 2016, and the Determination Rule in
2018 by evaluating air quality in 2012, 2017 and 2023, respectively. 76
FR 48211; 81 FR 74537.
    The D.C. Circuit affirmed the EPA's interpretation of ``will'' in
CAIR, finding the EPA's consideration of future projected air quality
(in addition to current measured data) to be a reasonable
interpretation of an ambiguous term. North Carolina, 531 F.3d at 913-
14. The North Carolina court affirmed the EPA's interpretation,
explaining that ``will'' ``can mean either certainty or indicate the
future tense'' and held that it is reasonable for the EPA to give
effect to both potential meanings of the word. Id. Thus, although the
court acknowledged that the term ``will'' could refer to the certainty
of an upwind state's impact on a downwind state (i.e., based on current
measured nonattainment), the court also clearly acknowledged the
ambiguity of this term and indicated this was not the only reasonable
interpretation. Given this ambiguity, the D.C. Circuit affirmed that
the EPA's approach is permissible under the Act.
    While the EPA agrees that the references to ``any'' in CAA section
110(a)(2)(D)(i) mean that any source of emissions of any air pollutant
having the requisite impact may be subject to control under that
provision, the commenter does not explain how this term limits the
EPA's discretion to

evaluate of future air quality when evaluating whether such emissions
have the requisite impact on downwind areas and therefore whether such
control is necessary or authorized. Rather, as the commenter fails to
acknowledge, the EPA is only authorized under the good neighbor
provision to require the prohibition of such emissions in ``amounts
which will'' improperly impact another state with respect to the NAAQS.
The Supreme Court has held that this language means that any emissions
reductions imposed under the good neighbor provision be no greater than
necessary to address downwind NAAQS, i.e., that the EPA avoid
unnecessary over-control of emissions from upwind states. See EME Homer
City, 572 U.S. at 521-22. In interpreting that decision, the D.C.
Circuit declared the EPA's emissions reduction requirements for certain
states to be invalid under the good neighbor provision where the EPA
had information indicating that there will be no downwind air quality
problems by the time the emissions reductions would have been
implemented. See EME Homer City II, 795 F.3d at 130. Thus, the EPA does
not agree that it is obligated to impose emissions reductions if there
will be no downwind air quality issues to address by the time such
reductions could be in place.
    Several commenters contend that, by evaluating air quality in a
future year the EPA fails to give ``emits'' in the phrase ``emits or
would emit'' under CAA section 126(b) independent meaning, thereby
unreasonably ignoring existing air quality issues in evaluating CAA
section 126(b) petitions. Commenters contend that the provision is
intended to provide relief for both current and future attainment and
maintenance problems, with one commenter noting that the ``or''
conjunction indicates that the criteria for demonstrating a violation
could be fulfilled either through current or future conditions. Thus,
the commenters conclude that it is inappropriate for the EPA to rely on
the word ``will'' in the good neighbor provision to base its analysis
on future air quality without considering current conditions.
    One commenter further asserts that the EPA's forward-looking
approach to interpreting the requirements of CAA section 126(b) is
inconsistent with its prior grant of a CAA section 126(b) petition from
New Jersey, which was based on the named source's current and ongoing
emissions.\50\ The commenter cites the Third Circuit's decision which
upheld the EPA's action on the petition in GenOn, indicating that the
court noted, in construing the timing provisions of CAA section 126
``that a statute ought, upon the whole, to be so construed that, if it
can be prevented, no clause, sentence, or word shall be superfluous,
void, or insignificant.'' 722 F.3d 513, 520-21 (3d Cir. 2013) (quoting
TRW Inc. v. Andrews, 122 S. Ct. 441 (2001)).
---------------------------------------------------------------------------

    \50\ Final Response to Petition from New Jersey Regarding
SO2 Emissions From the Portland Generating Station, 76 FR
69052 (November 7, 2011) (finding facility in violation of the
prohibitions of CAA section 110(a)(2)(D)(i)(I) with respect to the
2010 SO2 NAAQS prior to issuance of designations for that
standard).
---------------------------------------------------------------------------

    The EPA agrees it must give meaning to the statutory terms of CAA
section 126(b) and has done so here. As an initial matter, certain
commenters misconstrue the EPA's forward-looking evaluation of air
quality impacts under CAA section 126(b) as stemming from the phrase
``would emit'' under this provision. As described in this section, the
EPA looks to future air quality impacts under CAA section 126(b)
because of the future-looking reference in the word ``will'' under the
good neighbor provision, a violation of which is the explicit condition
precedent for making the requested finding under CAA section 126(b). As
explained in the EPA's prior actions under CAA section 126(b), the EPA