[Federal Register Volume 85, Number 192 (Friday, October 2, 2020)]
[Rules and Regulations]
[Pages 62218-62233]
[FR Doc No: 2020-18621]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 1042

[EPA-HQ-OAR-2018-0638; FRL-10013-36-OAR]
RIN 2060-AU30

Amendments Related to Marine Diesel Engine Emission Standards

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is amending the
national marine diesel engine program with relief provisions to address
concerns associated with finding and installing certified Tier 4 marine
diesel engines in certain high-speed commercial vessels. This relief is
in the form of additional lead time for qualifying engines and vessels.

DATES: This final rule is effective on November 2, 2020.

ADDRESSES: The EPA has established a docket for this action under
Docket ID No. EPA-HQ-OAR-2018-0638. All documents in the docket are
listed on the www.regulations.gov website. Although listed in the
index, some information is not publicly available, e.g., CBI or other
information whose disclosure is restricted by statute. Certain other
material, such as copyrighted material, is not placed on the internet
and will be publicly available only in hard copy form. Publicly
available docket materials are available either electronically in
www.regulations.gov or in hard copy at Air and Radiation Docket and
Information Center, EPA Docket Center, EPA/DC, EPA WJC West Building,
1301 Constitution Ave. NW, Room 3334, Washington, DC. Note that the EPA
Docket Center and Reading Room were closed to public visitors on March
31, 2020, to reduce the risk of transmitting COVID-19. The Docket
Center staff will continue to provide remote customer service via
email, phone, and webform. The telephone number for the Public Reading
Room is<PHONE_NUMBER>, and the telephone number for the Air Docket is
(202) 566-1742. For further information on EPA Docket Center services
and the current status, go to https://www.epa.gov/dockets.

FOR FURTHER INFORMATION CONTACT: Alan Stout, Office of Transportation
and Air Quality, Assessment and Standards Division (ASD), Environmental
Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105;
telephone number:<PHONE_NUMBER>; email address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Does this action apply to me?

    This action relates to marine diesel engines with rated power
between 600 and 1,400 kW intended for installation on vessels flagged
or registered in the United States, vessels that use those engines, and
companies that manufacture, repair, or rebuild those engines and
vessels.
    Categories and business entities that might be affected by this
rule include the following:

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               Category                NAICS code \a\          Examples of potentially affected  entities
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Industry.............................          333618  Marine engine manufacturing.
Industry.............................          336611  Shipbuilding and repairing.
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\a\ North American Industry Classification System (NAICS).

    This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely covered by these rules.
This table lists the types of entities that we are aware may be
regulated by this action. Other types of entities not listed in the
table could also be regulated. To determine whether your activities are
regulated by this action, you should carefully examine the
applicability criteria in the referenced regulations. You may direct
questions regarding the applicability of this action to the persons
listed in the preceding FOR FURTHER INFORMATION CONTACT section.

I. Summary

    EPA's 2008 Final Rule for Control of Emissions of Air Pollution
from Locomotive Engines and Marine Compression-Ignition Engines Less
than 30 Liters per Cylinder adopted Tier 4 emission standards for
commercial marine diesel engines at or above 600 kilowatts (kW) (73 FR
37096, June 30, 2008). These standards, which were expected to require
the use of exhaust aftertreatment technology, phased in from 2014 to
2017, depending on engine power.\1\ After the Tier 4 standards were
fully in effect for all engine sizes, some boat builders informed EPA
that there were no certified Tier 4 engines available with suitable
performance characteristics for the vessels they needed to build,
specifically for high-speed commercial vessels that rely on engines
with rated power between 600 and 1,400 kW that have high power density.
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    \1\ For engines up to 1,000 kW, compliance could be delayed for
up to nine months, but no later than October 1, 2017.
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    To address these concerns, EPA proposed, and through this rule is
adopting, provisions to provide additional lead time for implementing
the Tier 4 standards for engines used in certain high-speed vessels (84
FR 46909, September 6, 2019). We are also finalizing the proposed
approaches for streamlining certification requirements to facilitate or
accelerate certification of Tier 4 marine engines with high power
density. These changes are reflected in amendments to 40 CFR. 1042.145,
1042.505, and 1042.901 that we are making in this final rule. Each of
these elements is discussed in more detail in this final rule.
    The September 2019 proposed rule also included provisions related
to in-use fuel sulfur standards that apply for global marine fuel. We
adopted those regulatory amendments to 40 CFR part 80 in a separate
rule (84 FR 69335, December 18, 2019).
    The regulatory changes EPA is adopting in this final rule are
largely the same as we proposed, with a few adjustments to address
concerns raised by commenters. Several commenters also suggested that
we broaden the scope of the rule to provide additional relief--either
for a longer period or for a wider range of vessels. We are considering
further rulemaking action to address these concerns, as described in
Section VII.
    EPA adopted emission standards for marine diesel engines under
Clean Air Act authority (42 U.S.C. 7401-7671q). The amendments in this
rule are covered by that same authority.

II. Background

    In 2008, EPA adopted Tier 3 and Tier 4 emission standards for new
marine diesel engines with per-cylinder displacement less than 30
liters (73 FR 37096, June 30, 2008). The Tier 3 standards were based on
engine manufacturers' capabilities to reduce particulate matter (PM)
and oxides of nitrogen (NOX) emissions with recalibration
and other engine-based technologies. The Tier 4 standards were based on
achieving emission reductions through the application of catalytic
aftertreatment technology, including selective catalytic reduction
(SCR). These Tier 4 standards currently apply to commercial marine
diesel engines with rated power at or above 600 kW. The Tier 3
standards phased in for different engine sizes and power ratings from
2009 to 2014. The Tier 4 phase-in schedule applied these more stringent
standards starting in 2014 to engines at or above 2,000 kW, which are
most prevalent on large workboats that are less sensitive to engine
size and weight concerns. The Tier 4 standards started to apply at the
start of model year 2017 for engines from 1,000 to 1,400 kW, and on
October 1, 2017 for engines from 600 kW to 999 kW. The schedule for
applying the Tier 4 standards was intended to give engine manufacturers
time to redesign and certify compliant engines, and to give boat
builders time to redesign their vessels to accommodate the Tier 4
engines.
    The 600 kW threshold for applying the Tier 4 standards was intended
to avoid aftertreatment-based standards for small vessels used for
certain applications that were most likely to be designed for high-
speed operation with very compact engine installations. Most engines
above 600 kW provide power for various types of workboats and larger
passenger vessels. We were aware that there would be some high-speed
vessels with engines above 600 kW, but expected that engine
manufacturers would be able to certify 600-1,400 kW engines and vessel
manufacturers would be able to make the necessary vessel design changes
during the nine-year period between the final rule and the
implementation of the Tier 4 standards.
    In response to the proposal preceding the 2008 final rule, some
commenters recommended that the Tier 4 standards apply to engines as
small as 37 kW, because small land-based nonroad diesel engines were
subject to similar aftertreatment-based standards. Other commenters at
that time advocated a vessel-based approach, for example exempting
engines installed on patrol boats and ferries from the Tier 4
standards. However, engine manufacturers commented that a vessel-based
approach would be unworkable because they would then need to certify
engines for a range of vessel types. Several commenters affirmed the
600 kW threshold as appropriate, and no commenters suggested a higher
threshold. As a result, EPA finalized the 600 kW threshold without
further limiting the Tier 4 standards to particular types of commercial
vessels.
    In the intervening years, only one engine manufacturer certified
Tier 4 engines below 1,400 kW, and none of those had a power density
greater than 35 kW per liter total engine displacement.\2\ Engine
manufacturers pointed to the cost of product development and
certification rather than technological feasibility as the reason for
delaying certification of Tier 4 engines. We also heard from
manufacturers of high-speed vessels that the lack of certified Tier 4
engines with high power density was preventing them from building new
vessels. Most of these concerns were related to lobster boats and pilot
boats. Boat builders also told us that there would be greater
challenges when installing SCR-equipped engines in these high-speed
vessels.
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    \2\ Tier 4 engines in 2017 and 2018 were limited to
Caterpillar's 32-liter and 57-liter engines.
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    When we adopted the Tier 4 standards in 2008, most if not all
lobster boats used engines below 600 kW. Targeted lobster beds were
typically located relatively close to shore. Lobster boats navigating
in these areas have size and performance requirements that do not call
for engines above 600 kW. Since 2008, however, it has become common to
navigate to lobster beds 40 miles or farther from shore. The greater
traveling distance necessitates more cargo space for a greater catch,
and more speed to complete a day's work in a reasonable time. These
factors caused a demand for larger vessels and more engine power, which
led boat builders to install engines above 600 kW in lobster boats.
Prior to the Tier 4 standards taking effect in 2017, engines for these
lobster boats were subject to Tier 3 standards and thus required no
aftertreatment technology. As a result, the lobster-boat engines needed
for high speed and ocean navigation could fit into fiberglass hulls
with minimal changes to fiberglass molds, or vessel design generally.
    A complicating factor for pilot boats is other federal, state, or
local programs that impose speed restrictions on vessels for certain
vessel lengths. Specifically, pilot boats that operate in certain
coastal areas are subject to whale-strike avoidance rules that are
designed to protect migrating and calving right whales. In designated
areas off the coast of Georgia, for example, vessels 65 feet and longer
may not exceed an operating speed of 10 knots from November 1 to April
30 each year.\3\ The whale-strike avoidance rules increase the demand
for pilot boats that are less than 65 feet long. This additional
constraint further complicates the challenge to design vessels with
Tier 4 engines as the SCR emission control system takes up a
significant amount of already limited space. Here again, the use of
Tier 4 engines will require significant boat changes and more time is
needed to resolve these challenges.
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    \3\ The whale-strike avoidance rule was originally adopted by
the National Marine Fisheries Service on October 10, 2008 (73 FR
60173). See 50 CFR 224.105.
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    These concerns led us to propose provisions to allow additional
lead time for implementing the Tier 4 standards for engines used in
certain high-speed vessels, and to streamline Tier 4 certification
requirements. The proposal identified several vessel and engine
parameters that served as criteria to limit the additional lead time to
qualifying vessels, rather than naming certain vessel types.
    EPA benefitted from extensive input from engine manufacturers, boat
builders, and other stakeholders before publishing the proposed rule
and in the comments submitted during the comment period. This
information helped to clarify the constraints, capabilities, processes,
and concerns for engine manufacturers, vessel manufacturers, and others
affected by the Tier 4 standards.
    Since the middle of 2019, four additional engine manufacturers have
certified Tier 4 engines with rated power between 600 and 1,400 kW.
This expands the list of Tier 4 engine models that are available to
provide power for a wider range of vessel types. However, these new
engine certifications and the comments received do not change EPA's
concerns as stated in the proposed rule that manufacturers of vessels
for certain high-speed commercial applications continue to face
important challenges associated with the availability of engines
certified to the Tier 4 engine standards. These vessels have
performance needs for achieving substantial propulsion power from a
light-weight engine. In short, these vessel manufacturers have been
unable to find certified Tier 4 engines meeting their requirements for
maximum power, power density, and weight. See Section

V for a more detailed discussion of the newly certified engines and the
relationship to designing vessels with those Tier 4 engines.
    In response to these concerns, and consistent with the proposed
rule, EPA is adopting amendments to our marine diesel engine program to
provide additional lead time to address these concerns for certain
high-speed vessels. The new provisions allow engines installed on
qualifying high-speed vessels to continue to meet Tier 3 standards
during a relief period, which in turn will allow time for engine
manufacturers to certify additional engine models, and for vessel
manufacturers to implement design changes to their vessels to
accommodate new Tier 4 engines as they become available.
    The Tier 4 relief in this final rule addresses the concerns that
led to the proposed rule. In particular, absent relief, boat builders
would be unable to build the types of high-speed vessels identified in
the proposed rule in the near term. This could result in boat
purchasers sourcing new boats that are underpowered or prolonging the
service life of older boats, perhaps including replacement of original
engines with Tier 3 or dirtier engines. As more Tier 4 engines become
available, boat builders will be able to design and build high-speed
vessels that comply with Tier 4 requirements, consistent with the
schedule we are specifying in this final rule. Section IV evaluates the
cost and environmental impact of the relief provisions in this final
rule.
    Note that the new provisions allowing additional lead time for
EPA's Tier 4 marine diesel engine standards are distinct from the
international engine emission standards that apply under Annex VI to
the International Convention for the Prevention of Pollution from Ships
(MARPOL Annex VI). Because the domestic and international emission
standards are adopted under different legal authorities, this rule has
no bearing on the international standards. It is also the case that
U.S. vessels operating only domestically are not subject to the
standards adopted under MARPOL Annex VI (see 40 CFR 1043.10(a)(2)). As
a result, the high-speed commercial vessels that are the subject of
this rule will not be subject to emission standards under MARPOL Annex
VI as long as they do not operate internationally.

III. Regulatory Changes in This Final Rule

    In this rule, EPA is adopting revisions to the marine diesel engine
emission control program for certain high-speed vessels and the
associated engines with rated power between 600 and 1,400 kW. These
changes provide more time for engine manufacturers to certify
additional engine models and for vessel manufacturers to design and
build boats with Tier 4 engines. We are also making changes to our
certification requirements to facilitate certification, especially
related to demonstrating the durability of emission controls.
    The regulatory changes in this final rule are largely the same as
we proposed, with a few adjustments in response to concerns raised by
commenters. Several commenters also suggested that we broaden the scope
of the rule to provide additional relief--either for a longer period or
for a wider range of vessels. We are considering further rulemaking
action to address these concerns, as noted in Section VII.

A. Adjusted Implementation Dates

    EPA is revising the Tier 4 implementation dates for certain types
of marine diesel engines for installation in qualifying high-speed
vessels. The additional time will allow vessel manufacturers to
redesign their vessels to accommodate engines with the Tier 4
technology. Engine manufacturers have also indicated that the
additional time will allow them to certify more engine models with high
power density to the Tier 4 standards.
    The new lead time provisions have two phases. The first phase sets
model year 2022 as the Tier 4 implementation deadline for engines
installed in high-speed vessels meeting a specific set of criteria. The
second phase sets model year 2024 as the Tier 4 implementation deadline
for engines installed in a narrower set of high-speed vessels that are
facing a different set of compliance challenges.
    We are applying the model year 2022 implementation date for Phase 1
relief, as proposed. This will allow boat builders time to redesign
qualifying vessels to install certified Tier 4 engines. Available
engines include currently certified models with total displacements of
24 and 32 liters. Engine manufacturers are also continuing to develop
additional Tier 4 engine models.
    The second phase addresses the different needs of manufacturers of
fiberglass and other nonmetal vessels up to 50 feet long that need
additional time to redesign their boats to use 600-1,000 kW engines
certified to Tier 4 standards.
    Boat builders and boat owners expressed a concern that the proposed
additional lead time for both Phase 1 and Phase 2 was not adequate. For
Phase 1, commenters requested some additional years to redesign
vessels, and to find customers needing vessels during the relief
period. Our intent in the proposed rule was to allow boat builders to
address the dilemma of not being able to fill orders for building new
boats because Tier 4 engines were not available. We did not intend, and
do not support, a longer time frame that would allow boat builders to
seek out expanded opportunities based on marketing the cost-saving
advantages of Tier 3 compliant vessels for additional customers. The
additional lead time associated with this proposed rule will allow
vessel manufacturers to reconfigure vessels, create new tooling, and
start producing compliant vessels.
    Commenters representing the lobstering industry described their
concerns that Tier 4 standards would be more challenging and may never
be appropriate for vessels meeting the Phase 2 criteria. The types of
lobster boats that need engines with more than 600 kW have size and
performance characteristics that are best met with 15-18 liter engines.
Larger engines, especially with SCR aftertreatment, are too large and
heavy to provide a suitable alternative power source for these lobster
boats. We are therefore adopting the Phase 2 relief, as proposed, to
allow two additional years of lead time beyond the Phase 1 criteria,
and a waiver process to address the possibility that Tier 4 engines
will continue to be unavailable.
    Vigor, Gladding-Hearn, and Ray Hunt Design requested that EPA
clarify whether they would need to take certain steps before the end of
the relief period for their vessels to qualify for the additional lead
time. Implementation of new emission standards is based on a
combination of build dates for the engines and the vessels. For
example, Phase 1 relief expires in 2021, which means that engines
qualifying for relief must have a date of manufacture in model year
2021 or earlier; i.e., crankshafts must be installed in those engine
blocks on or before December 31, 2021.\4\ Similarly, vessels qualify
for relief only if their keels are laid on or before December 31,
2021.\5\
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    \4\ See the prohibition in 40 CFR 1068.101(a)(1) and the
definitions of ``Date of manufacture'' and ``Model year'' in 40 CFR
1068.30.
    \5\ See the prohibition in 40 CFR 1068.101(a)(1) and paragraph
(8) of the definition of ``Model year'' in 40 CFR 1042.901.
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    At the same time, however, we are concerned that boat builders may
lay keels and order engines speculatively to allow them to sell Tier 3
vessels for several years beyond the relief period. This practice would
be contrary to the

intent of the proposed relief. The program is intended to allow boat
builders to meet existing demand for certain high-speed vessels where
they are currently unable to supply those vessels. To prevent building
up inventories of vessels during the relief period to circumvent the
Tier 4 standards, we are adopting a requirement to limit the relief to
vessels for which the boat builder has a written contract from a buyer
to purchase a vessel. The contract must be signed before the end of the
relief period.

B. Relief Criteria

    Vessels qualify for relief if they meet certain criteria, as
specified in the proposal and updated for this final rule.
    Both phases of relief will be available only to engines installed
on high-speed vessels. High-speed vessels may generally be
characterized as planing vessels based on a hull design that causes the
vessel to rise up out of the water and experience lower hydrodynamic
drag (with a corresponding decrease in required propulsion power) when
operating at high speed. This contrasts with displacement hulls, for
which propulsion power continuously increases with increasing vessel
speed. Vessels with displacement hulls do not experience the same
design and installation challenges compared to planing hulls. While
this distinction is straightforward, there is no generally accepted way
to draw a clear line between the two types of vessels. This is
illustrated by ``semi-planing'' vessels, which have operating
characteristics that fall between planing and displacement vessels. We
are adopting a vessel speed criterion, as proposed, that is consistent
with industry practice. We are limiting relief to high-speed vessels
that have a maximum operating speed (in knots) at or above 3.0 [middot]
L\1/2\, where L is the vessel's waterline length, in feet.
This includes an upward adjustment of about 40 percent compared to
published definitions to draw a clearer line to identify high-speed
vessels. As an example, 45-foot vessels would need to have a maximum
speed of at least 23 knots to qualify for relief using the specified
threshold. Vessels not meeting the speed criterion either (1) are large
enough to not have the same sensitivity to engine size and weight that
should qualify them for relief from using Tier 4 engines or (2) do not
need engines with more than 600 kW. In particular, vessels with
displacement hulls that are less than 65' long generally do not have
engines with rated power above 600 kW. The vessel speed criterion
applies equally to both phases of adjusted implementation dates for the
Tier 4 standards.
    Both phases of relief will be available to both inspected and
uninspected commercial vessels. This is different from our proposal,
which would have limited both phases of relief provisions to vessels
classified as uninspected vessels by the U.S. Coast Guard.\6\ Coast
Guard designates all commercial vessels as either inspected or
uninspected. Inspected vessels carry freight-for-hire or any hazardous
or dangerous cargo. Towing and most passenger vessels are also
inspected. In contrast, uninspected vessels include recreational
vessels not engaged in trade, non-industrial fishing vessels, very
small cargo vessels (less than 15 gross tons), and miscellaneous
vessels such as pilot boats, patrol and other law-enforcement vessels,
fire boats, and research vessels, among others. The Passenger Vessel
Association, All American Marine, Gladding-Hearn, and Savannah Bar
Pilots indicated that there are examples of inspected vessels that face
the same issues related to engine availability and design constraints
that apply for uninspected vessels. For example, pilot boats may be
inspected or uninspected, depending on the owner's interest in
expanding the use of a pilot boat to carrying some paying passengers.
We agree that limiting relief to uninspected vessels may unnecessarily
exclude some vessels for which relief was intended. We have therefore
revised the final rule to remove this as a qualifying criterion. This
change is necessary to accomplish the goal of the intended relief. We
do not think this change will significantly expand the range or number
of vessels that will qualify for relief, because other engine and
vessel qualifying criteria will continue to limit the number of
qualifying vessels.
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    \6\ See Title 46, Chapter I, of the Code of Federal Regulations.
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    Vessels qualify for additional lead time based on engine
characteristics in addition to the vessel characteristics described
above. Qualifying engines would need to be certified to EPA's Tier 3
standards and have certain characteristics related to power density and
maximum power output. Specifically, the first phase of relief is
limited to propulsion engines with maximum power output up to 1,400 kW,
and power density of at least 27.0 kW per liter displacement, rather
than the proposed 35.0 kW per liter displacement. In addition, we are
limiting relief to engines that will be installed on vessels with a
waterline length up to 65 feet with total nameplate propulsion power at
or below 2,800 kW (to accommodate vessels with multiple propulsion
engines). The combination of the limit on maximum power for each engine
with the limit on the total nameplate propulsion power has the
practical effect of limiting relief to vessels with one or two
propulsion engines. These criteria are intended to target relief from
the Tier 4 standards for the engines and vessels identified in the
proposed rule as needing additional lead time.
    The second phase of relief is limited to engines that will be
installed on vessels with a single propulsion engine with maximum power
output up to 1,000 kW and power density of at least 35.0 kW per liter
displacement, where the vessel is made with a nonmetal hull and has a
maximum waterline length of 50 feet. As noted in the proposed rule, we
limited Phase 2 relief to fiberglass and other nonmetal hulls because
of the cost of creating new hull forms, and because there is no option
for a twin-engine installation for lobster boats or similar vessels
less than 50'.
    Gladding-Hearn and Ray Hunt Design requested that the regulation
clearly state how to determine vessel length, and suggested referencing
the U.S. Coast Guard regulations at 46 CFR 175.400. We agree with these
comments and are adding a regulatory definition of ``waterline length''
in 40 CFR 1042.901 that references the Coast Guard regulation. This
includes language defining a worst-case condition representing maximum
vessel loading and minimum water density. This is intended to prevent a
situation in which a vessel could exceed specified length limits as a
result of changing conditions.
    We proposed power density criteria of 35.0 and 40.0 kW per liter
displacement for Phase 1 and Phase 2, respectively. The proposed
criteria were intended to focus the relief on lightweight engines
needed for the affected high-speed vessels. However, boat builders
expressed a concern that the proposed value might reduce the number of
available Tier 3 engines to the point that the relief provisions would
not allow them to build the vessels as contemplated in the proposed
rule. Vigor and Savannah Bar Pilots identified 27 kW/liter as an
alternative qualifying threshold to allow a wider range of engines that
could be used with vessels qualifying for relief. Similarly, Gladding-
Hearn and Ray Hunt Design identified 24 kW/liter as an alternative
qualifying threshold. The 24 kW/liter value was based on an engine
model with 57 liters total displacement, and the 27 kW/liter value was
based on an engine model with 38 liters total displacement. We agree
that a wider

range of power density values is appropriate to accomplish the rule's
objectives and are therefore adjusting the power density thresholds for
the final rule. We selected the 27 kW/liter threshold because the 38-
liter engine is a viable option for vessels qualifying for Phase 1
relief, while the 57-liter engine is much too large to be a viable
option for these vessels. If we consider relief for additional types of
vessels in a future rulemaking, as described in Section VII, we may
reconsider the appropriate qualifying criteria for engines installed on
those vessels.
    These commenters suggesting lower power density thresholds made
clear that weight considerations are a secondary engine parameter in
designing high-speed vessels. For example, a 38-liter engine at 27 kW/
liter provides about 1,100 kW of propulsion power. An engine could
achieve the same power output with only 29 liters total displacement if
the engine had power density at 35 kW/liter. The incremental engine
weight of adding SCR to a 29-liter engine is probably less than the
added weight of the larger engine without SCR. We therefore conclude
that space and packaging rather than engine weight are the limiting
factor in designing compliant high-speed vessels. This helps us to
understand the range of engine characteristics that will be suitable
for these vessels when the Tier 4 standards apply.
    Table 1 summarizes the provisions we are adopting for additional
lead time in this rule. This takes the form of a revised Tier 4
implementation schedule for propulsion engines with high power density.

       Table 1--Summary of Qualifying Criteria for Adjusted Tier 4
                          Implementation Dates
------------------------------------------------------------------------
          Criteria \1\                  Phase 1             Phase 2
------------------------------------------------------------------------
Vessel speed (knots)............  >3.0 [middot]       >3.0 [middot]
                                   (feet)\1/2\.        (feet)\1/2\.
Engine power density............  >27.0 kW/liter....  >35.0 kW/liter.
Engine power rating.............  <=1,400 kW........  <=1,000 kW.
Total vessel propulsion power...  <=2,800 kW........  <=1,000 kW.
Vessel's waterline length.......  <=65 feet.........  <=50 feet.
Vessel hull construction........  Any...............  nonmetal.
Model years for continued use of  through 2021......  through 2023.
 Tier 3 Engines.
------------------------------------------------------------------------
\1\ The specified engine criteria apply for the Tier 3 engines installed
  in vessels that qualify for relief.

    Only those engines and vessels that meet the criteria we are
finalizing in this rule qualify for the revised Tier 4 implementation
dates. An engine installed in a nonqualifying vessel, or a
nonqualifying engine installed on any vessel, is subject to the
prohibitions set out in 40 CFR 1068.101(a)(1) for new engines and
vessels introduced into U.S. commerce, and would therefore be in
violation.
    In addition to the above provisions, several commenters suggested
other adjustments to the proposed criteria to broaden the scope of
relief. Section V includes our response to those comments.

C. Availability of Tier 3 Engines During Relief Period

    Engine manufacturers will need to certify engines above 600 kW to
the Tier 3 commercial standards for installation in newly constructed
vessels that meet the qualifying criteria before vessel manufacturers
can utilize the additional lead time provided in this final rule. Boat
builders may need these Tier 3 engines very soon after we finalize this
rule. To do this, engine manufacturers would generally need to restart
production of engine configurations that were already certified to the
Tier 3 commercial standards. Engine manufacturers may still be
producing these or substantially equivalent engine configurations as
certified Tier 3 recreational engines, as exempt replacement engines,
or as engines for export. In most cases, engine manufacturers can
resubmit information from their earlier Tier 3 application for
certification to cover the new production.
    Vigor, Gladding-Hearn, Ray Hunt Design, Savannah Bar Pilots, and
Columbia River Pilots asked EPA to allow installation of recreational
Tier 3 engines in commercial vessels during the relief period. We are
not adjusting our program to allow this. Since the beginning of our
emission control program for marine diesel engines, we have prohibited
installation of recreational engines in commercial vessels.
Recreational engines have a much shorter useful life and therefore
cannot provide reliable emission control in a commercial application.
However, engine manufacturers can consider qualifying their
recreational marine engines as light-commercial marine engines meeting
a reduced useful life of 5,000 hours, as described in Section III.E.2.
Except for that accommodation, we still find it important to disallow
installation of recreational engines in commercial vessels. For
manufacturers using the new provision for a reduced useful life, we
will be ready to work with engine manufacturers to apply the provisions
of 40 CFR 1042.245(b) to determine appropriate deterioration factors
(see Section III.E.1).
    Based on input received from engine manufacturers after the comment
period, we expect boat builders to have several available Tier 3 engine
models. Several manufacturers indicated publicly that they intend to
pursue certification for Tier 3 commercial engines above 600 kW during
the relief period, including Caterpillar (18-liter and 32-liter), MTU
(22-liter and 27-liter) and Scania (16-liter). We are aware of
additional engine manufacturers that may also pursue Tier 3
certification for engines above 600 kW.

D. Relief Through Waivers for Qualifying Engines and Vessels

    EPA is adopting waiver provisions that start to apply in 2024 for
vessels meeting the Phase 2 specifications described in Table 1. These
waiver provisions are intended to allow boat builders to continue
building boats with Tier 3 engines if engine manufacturers have not yet
certified suitable engines for those vessels.
    Starting in 2024, manufacturers of vessels meeting the Phase 2
qualifications described in Table 1 have the option to request that EPA
approve an exemption from the Tier 4 standards. EPA will evaluate these
requests based on the availability of suitable certified Tier 4 engines
at the time of the request for the intended vessel design. EPA may
approve requests covering multiple vessels, but any approval will apply
only for the number of vessels approved for relief. The waiver
authority does not expire, so EPA would be able to

continue approving manufacturers' requests to install Tier 3 engines in
qualifying vessels until suitable certified Tier 4 engine models become
available.
    The Passenger Vessel Association, Vigor, Savannah Bar Pilots, and
Columbia River Pilots suggested that the waiver process should also
apply for all vessels meeting the Phase 1 qualifying criteria. As noted
above, the waiver provisions are intended to allow for continued boat
building in case there continue to be no suitable Tier 4 engines for
the targeted vessels. In 2022 and later, we expect boat builders to be
able to choose from several Tier 4 engine models between 20 and 40
liters total displacement. It will take time to modify vessel designs
to accommodate Tier 4 engine technologies, but it is reasonable to
expect the available Tier 4 engines to be suitable for the Phase 1
vessels. As mentioned above and described in Section VII, we are
considering a separate rulemaking proposal to address remaining
questions about the availability of Tier 4 engines for other types of
high-speed vessels where there may not yet be suitable Tier 4 engines.
    EMA stated that they do not support extending Tier 4 relief for a
longer period than we proposed. They specifically objected to
specifying 2028 as the year for applying the Tier 4 standards for Phase
2 relief based on engine manufacturers' need to start selling Tier 4
engines to recover their development costs. They also expressed a
concern that waiver provisions could be disruptive for product planning
if the waiver approval would not be well defined or if it extended more
than one year beyond the adjusted starting date of the Tier 4
standards. We agree that adding several years of lead time would not be
an effective way to support the engine manufacturers' development and
certification programs for Tier 4 engines. The waiver process is
preferable because it allows us to limit relief in 2024 and later to
cases in which there are no suitable engines certified to the Tier 4
standards. For example, engine manufacturers have not committed to
certifying Tier 4 engines below 20 liters, and if that is still the
case and raised in a request for a waiver, it may be appropriate not to
limit a waiver to a single year beyond the adjusted start date for the
Tier 4 standards. Conversely, if an engine manufacturer certifies an
engine model that is suitable for powering vessels that would otherwise
meet the specified Phase 2 criteria, it would be appropriate to deny
the waiver request. The waiver provisions spell out the approval
criteria needed for EPA to evaluate any future requests for relief; the
approval process with the approval criteria adequately define the terms
of the waiver to avoid arbitrary decision-making that would be
disruptive for engine manufacturers and their product planning.

E. Revised Certification Requirements

    Engine manufacturers told us that one of the biggest factors
delaying their plans to certify Tier 4 engines in the 600 to 1,400 kW
power range is the expected low sales volumes that make it harder to
recover the investment needed to develop marine-specific calibrations
and perform the testing needed to certify engines under 40 CFR part
1042. We understand engine manufacturers' concerns to recover their
investment in designing and certifying compliant engines. The market
for compliant engines is expected to grow as more engines are needed
internationally to comply with the stringent emission standards adopted
for NOX Emission Control Areas under MARPOL Annex VI.
Manufacturers are also expected to redesign their engines to comply
with the stringent marine diesel engine emission requirements for
vessels operating on inland waterways in Europe. The stringency of the
European standards is similar to EPA's Tier 4 standards for
NOX emissions and is more stringent for PM emissions. These
standards will therefore contribute to further development and
installation of advanced emission controls.
    To facilitate certification of engines meeting the EPA Tier 4
standards, we are adopting revised engine certification requirements
aimed at reducing engine manufacturer compliance and certification
costs for the affected engines. These provisions are intended to help
accelerate the market entry of additional Tier 4 marine engines, and
additional power ratings for engines already certified to Tier 4
standards.
1. Deterioration Factors
    We are adopting a temporary provision allowing engine manufacturers
to certify specific engines to Tier 4 standards based on assigned
deterioration factors. Engine manufacturers rely on deterioration
factors so they can test a new engine and adjust the test results
mathematically to represent emission levels at full useful life. Before
this rule, the regulations for certifying marine diesel engines have
allowed assigned deterioration factors only for small-volume engine
manufacturers and post-manufacture marinizers. Assigned deterioration
factors reduce the cost and time to certify to Tier 4 standards, which
could accelerate the schedule for certifying, and may lead
manufacturers to decide to pursue Tier 4 certification in light of the
expected low sales volumes for recovering the associated development
costs.
    To encourage development of additional engine options for high-
speed vessels, we will allow assigned deterioration factors for engines
with power density above 30.0 kW/liter displacement. This applies
through 2024 for 1,000-1,400 kW engines, and through model year 2026
for 600-1,000 kW engines. These dates are set to apply for the first
three years after the Tier 4 standards start to apply on the adjusted
schedule, with the expectation that engine manufacturers could
accumulate information on the durability characteristics of engines
during those three model years before needing to develop family-
specific deterioration factors.
    The proposal specified that assigned deterioration factors would be
available for two years for engines with power density above 35.0 kW/
liter. Engine manufacturers' comments requested that we allow assigned
deterioration factors down to 30.0 kW/liter, and for a year longer than
we proposed. They suggested the changes to ensure that the amended
provisions would together create the appropriate reduction in
development costs needed to achieve the objective of getting additional
engines certified to the Tier 4 standards. We had selected the proposed
thresholds for power density mostly to prevent adverse competitive
effects for manufacturers that had already certified to Tier 4
standards. We realize, however, that even those manufacturers with
certified engines can benefit from the new flexibility for certifying
additional engine families.
    We have reviewed available data to support default values for
assigned deterioration factors. The deterioration factors are
multiplicative values of 1.1 for NOX and 1.4 for HC and CO,
and an additive value of 0.003 g/kW-hr for PM.\7\ These are the same
values specified for the proposed rule. Where an individual engine
manufacturer has existing data available, such as from certified land-
based versions of its marine engines, EPA would consider that
information, consistent with 40 CFR 1042.245(b), and may adjust the
value of one or more default assigned deterioration factors
accordingly.
---------------------------------------------------------------------------

    \7\ ``Technical Analysis for Amendments Related to Marine Diesel
Engine Emission Standards,'' EPA memorandum from Cheryl Caffrey to
Docket EPA-HQ-OAR-2018-0638, August 1, 2019.

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

    Engine manufacturers would need to certify using family-specific
deterioration factors in the first model year after the assigned
deterioration factors are no longer available. Manufacturers could
determine new deterioration factors from a conventional durability
demonstration based on emission measurements before and after an
extended period of service accumulation in the laboratory.
    The proposal included a request for comment to allow at-sea
emission measurement in addition to lab-based measurement to establish
deterioration factors. We contemplated this change in the context of
engine manufacturers' interest in an alternative to the conventional
durability demonstration. In their comments, engine manufacturers did
not support changing the program to require deterioration factors based
on emission measurement for engines installed in vessels. We will not
adopt this as a requirement. With respect to alternative durability
demonstration, we note that 40 CFR 1042.245(b) allows manufacturers to
determine deterioration factors using an engineering analysis based on
emission measurements from highway or nonroad engines that are similar
to the marine engine being certified.
2. Reduced Regulatory Useful Life for Light Commercial Engines
    We proposed to reduce the useful life from 10,000 hours to 5,000
hours for commercial marine engines that have power density above 50.0
kW/liter displacement. There are currently no engines certified to Tier
4 standards with power density above 44 kW per liter. We acknowledge
that increasing an engine's power rating comes from higher intake air
pressures and greater fuel flow into the engine, which can cause some
engine and aftertreatment components to wear out sooner. Engines with
lower power density are designed for continuous operation for very long
periods with minimal downtime. Engines with high power density are
inherently lighter weight for a given power rating and have a shorter
time before scheduled rebuilding. Under our current regulations, the
same regulatory useful life applies for commercial engines without
regard to power density. However, the performance demands associated
with high power density make it more difficult to demonstrate that
engines with aftertreatment technology will meet Tier 4 standards over
the full regulatory useful life.
    Vigor and Savannah Bar Pilots supported the proposal to adopt a
shorter useful life for engines with high power density as a way to
increase the number of certified engines, but stated that 40 kW/liter
would be the appropriate qualifying threshold. The Truck and Engine
Manufacturers Association also supported adopting a shorter useful
life, but stopped short of making a recommendation on the threshold
that should apply.
    We are adopting a shorter regulatory useful life for commercial
engines above 600 kW with very high power density as proposed, except
that the qualifying threshold is 45.0 kW/liter (see Sec.  1042.145). If
manufacturers opt for the shorter useful life for qualifying engines,
we consider those to be ``light-commercial marine engines'' (see Sec.
1042.901). The newly certified 24-liter engine from MAN meets the Tier
4 standards for a useful life of 10,000 hours at a top rating of about
44 kW/liter. This engine serves as an important benchmark for decision-
making about the limits of a 10,000 hour useful life in an engine with
very high power density. First, the engine demonstrates the feasibility
of meeting the Tier 4 standards for 10,000 hours. Second, it
demonstrates the feasibility limits of meeting Tier 4 standards over a
useful life of 10,000 hours. MAN makes this same engine with higher
power ratings for recreational applications. We therefore understand 44
kW/liter to be the upper bound for meeting the Tier 4 standards without
a reduced useful life. Setting the threshold at 45.0 kW/liter creates
an incentive for other manufacturers to pursue engine certification for
higher-output light-commercial ratings to create additional power
alternatives for boat builders that need to meet the most demanding
performance specifications.
    The reduced useful life for light-commercial engines also applies
for Tier 3 engines with maximum power above 600 kW, consistent with the
proposed rule. This may increase the number of engine models available
during the relief period to the extent that engine manufacturers
certify recreational engine models for light-commercial applications.
The Truck and Engine Manufacturers Association commented asking that we
specify the shorter useful life also for Tier 3 engines below 600 kW.
However, there are several such engine models currently certified to
the Tier 3 standards over a useful life of 10,000 hours with power
density between 45 and 55 kW/liter. As a result, allowing engines less
than 600 kW to qualify for a shorter useful life would relax the
stringency of standards that manufacturers are already meeting. We are
therefore not reducing the useful life for engines below 600 kW.
    Manufacturers certifying engines to Tier 4 standards using a
reduced useful life can use assigned deterioration factors as described
in Section III.E.1. In the proposal, we considered adjusting the values
of the assigned deterioration factors to account for the shorter useful
life. However, this final rule applies the same assigned deterioration
factors for the shorter useful life, because we expect those engines to
experience the same amount of wear and degradation in 5,000 hours that
other engines would experience in 10,000 hours.
3. Engine Duty Cycle for Certification Testing
    Engine manufacturers certify their engines to the relevant emission
standards by measuring emissions at test points on the applicable duty
cycle specified in 40 CFR 1042.505 and contained in Appendix II of 40
CFR part 1042, and summing the weight-adjusted emission results. As
described in 40 CFR 1042.505(b)(1) and (2), commercial propulsion
engines with fixed-pitch propellers are tested on the 4-mode E3 duty
cycle, and recreational engines are tested on the 5-mode E5 duty cycle.
While engine speed and power at the test modes are substantially the
same for both duty cycles, the E5 duty cycle has an extra test point at
idle and also includes different weighting to calculate overall
emissions. These duty cycles are intended to represent in-use operation
for the different applications: Commercial engines are expected to
operate more time at 75% load and above while doing work (engaged in
commercial activity) while recreational engines are expected to operate
at high load only occasionally. Recreational engines have much less
operation overall, and they spend more time at idle and low engine
loads.
    Table 2 reproduces the speed and power settings for the E3 and E5
duty cycles.

                       Table 2--Speed and Power Settings for the ISO E3 and E5 Duty Cycles
----------------------------------------------------------------------------------------------------------------
                                                                    Percent of
                                                                   maximum test    E3 weighting    E5 weighting
               Mode No.                       Engine speed             power          factors         factors
                                                                     (percent)
----------------------------------------------------------------------------------------------------------------
1.....................................  Maximum test speed......             100            0.20            0.08
2.....................................  91%.....................              75            0.50            0.13
3.....................................  80%.....................              50            0.15            0.17
4.....................................  63%.....................              25            0.15            0.32
5.....................................  Warm idle...............               0  ..............            0.30
----------------------------------------------------------------------------------------------------------------

    In response to EPA's request for comment on duty cycles, engine
manufacturers asked that EPA allow the option of using the E5 duty
cycle to certify commercial marine diesel engines with power density
above 30.0 kW/liter. Engines above 30 kW/liter may be used in
applications that are more like high-speed recreational boats (e.g.,
planing boats) than low-speed commercial boats (e.g., river boats). We
agree with engine manufacturers that this change is appropriate. We are
therefore amending 40 CFR 1042.505 to allow manufacturers to certify
engines above 30.0 kW/liter using the E5 duty cycle. The reasons for
this change are the same as the reasons supporting the reduced useful
life revision described above. These engines are likely to be operated
in a way more reflective of the E5 duty cycle, particularly those
installed on planing or semi-planing vessels like lobster boats or
pilot boats. The option to certify engines above 30.0 kW/liter applies
equally to Tier 3 and Tier 4 engines.
    As noted above, engines with power density above 45.0 kW/liter may
certify with a reduced useful life of 5,000 hours. These engines are
inherently limited to installation in vessels whose operation is
shifted toward light-load operation. We are therefore requiring engines
to be certified using the E5 duty cycle if they have the shorter useful
life. This may require development of engine calibrations and control
strategies optimized to maintain low NOX emissions at idle
and low-load operation to ensure that in-use engines will control
emissions as effectively as the prototype engine tested for
certification.
    We will not require testing with both E3 and E5 duty cycles for any
engine families certified to EPA standards under 40 CFR part 1042.
However, to simplify dual certification to both our Clean Air Act
marine diesel engine standards and MARPOL Annex VI Regulation 13
NOX limits, manufacturers may submit test data from both
duty cycles. The reported data would need to show that engines meet
emission standards over each duty cycle.
    These changes to the program will not require new testing for
engines that are already certified to our Tier 3 or Tier 4 standards,
and certification based on the E3 duty cycle will continue to be valid
for demonstrating compliance with standards for any engines certified
to a useful life of 10,000 hours.

IV. Economic and Environmental Impacts

    The economic impact, emission inventory, and human health and
welfare assessments performed for this final rule use the same
methodologies as were used for the proposal. The inventory and costs
assessments rely on the data and methodologies developed to support our
2008 Final Rule. The benefits assessment uses a simplified health
benefits estimation method. The results of these analyses are set out
in a technical memorandum prepared for this rule,\8\ are summarized
below, and are contained in Table 3 below. The Technical memorandum
also contains the Executive Order 13771, Reducing Regulation and
Controlling Regulatory Costs analysis prepared for this rule.
---------------------------------------------------------------------------

    \8\ See ``Final Assessment Analysis: Amendments Related to
Marine Diesel Engine Emission Standards,'' EPA memorandum from Jean
Marie Revelt, EPA, Kenneth Davidson, PS, and Margaret Zawacki, EE,
to Docket EPA-HQ-OAR-2018-0638, August 12, 2020.
---------------------------------------------------------------------------

    Consistent with the economic impact analysis prepared for EPA's
2008 rulemaking, the costs for this final rule were estimated using
both a behavioral approach (in the intermediate-run after the adoption
of new standards, producers pass only some compliance through to
consumers), and a full-cost pass-through approach (in the long-run
after the adoption of new standards, producers pass all compliance
costs through to consumers). This rule imposes no additional economic
costs above those included in our 2008 rulemaking. Instead, the
additional lead time is expected to result in cost savings. We estimate
cost reductions of about $3.9 million, using a behavioral modeling
approach, or $4.2 million, using a full-cost pass-through approach
(2015$). These are the estimated cost reductions from installing less
expensive Tier 3 engines in new vessels during the relief period (2020
through 2023) and the associated operating cost reductions during the
13-year lifetime of those engines (2020 through 2035).
    With respect to emission inventory impacts, this rule changes the
implementation date of the Tier 4 standards for qualifying engines and
vessels, which will delay the emission and air quality benefits of
those standards. The estimated annual increase in NOX and
PM10 \9\ emissions associated with the relief is about 108
and 2.3 short tons, respectively, in 2020 and 2021, when both sets of
engines are affected, decreasing to 37 and 1 ton, respectively, in 2022
and 2023, when only those engine up to 1,000 kW engines are affected.
The lifetime inventory increase is estimated to be about 3,764 tons of
NOX and 79 tons of PM10, assuming a 13-year
lifetime. This represents less than one-tenth of one percent of the
national annual emissions for these pollutants from commercial Category
1 marine diesel engines (i.e., engines below 7.0 liters per cylinder
displacement).
---------------------------------------------------------------------------

    \9\ Consistent with the 2008 Rule, this inventory analysis is
for PM10. In the 2008 rule, PM2.5 was
estimated at 97% of PM10.
---------------------------------------------------------------------------

    The estimated impacts on emissions and costs presented in Table 3
do not include the use of waivers. If engine manufacturers apply for
and receive waivers post-2023, the estimated cost reductions and
emission inventory impacts would increase and would extend for a longer
period of time (the useful life of the engines produced subject to the
waiver).

                                Table 3--Estimated Impacts on Emissions and Costs
----------------------------------------------------------------------------------------------------------------
                                                 NOX increase    PM10 increase
                                   Affected        per year        per year      Compliance cost  Operating cost
             Year                 engines per    (short tons)    (short tons)       reduction        reduction
                                     year                                           (2005$) *         (2005$)
----------------------------------------------------------------------------------------------------------------
2020..........................              25           108.1             2.3  $455,667 to              $36,000
                                                                                $531,177.
2021..........................              25           216.3             4.6  $455,913 to               72,000
                                                                                $531,689.
2022..........................              21           252.9             5.3  $301,749 to              102,240
                                                                                $359,562.
2023..........................              21           289.5             6.1  $301,686 to              132,480
                                                                                $359,499.
2024..........................               0           289.5             6.1  0...............         132,480
                                                                               ---------------------------------
    Lifetime Impacts (sum of                92           3,764            79.2    $3.2 to $3.5 million (2005$)
     2020-2035).
                                                                                ($3.9 to $4.2 million 2015$)
----------------------------------------------------------------------------------------------------------------
* Costs were modeled in 2005$; lifetime impacts were converted in the final step of the analysis. Lower value of
  costs impacts estimated with a behavioral modeling approach, upper value estimated with a full-cost pass-
  through modeling approach. See ``Assessment Analysis: Final Marine CI Tier 4 Rule,'' EPA memorandum from Jean
  Marie Revelt, to Docket EPA-HQ-OAR-2018-0638 for details.

    These forgone emission reductions are associated with forgone
improvements in human health. Using reduced form health benefit per-ton
values,\10\ we estimate that the annual PM2.5-related
forgone benefits do not exceed a high-end estimate of $3.0 million in
any given year (2015$, 3% discount rate, mortality effect estimate
derived from Lepeule et al., 2012). The total present value of the
stream of forgone benefits ranges from $9.8 million to $31 million.
---------------------------------------------------------------------------

    \10\ PM2.5-related health benefits are estimated by
applying sector-specific (C1/C2 marine vessel engine) benefit per
ton values for NOX and directly-emitted PM2.5
using a source apportionment approach that is similar to what has
been used in past EPA analyses. See: Wolfe, P., Davidson, K.
Fulcher, C., Fann, N., Zawacki, M., Baker, K.R. (2018). Monetized
health benefits attributable to mobile source emission reductions
across the United States in 2025. STOTEN, 650 (2019) 2490-2498,
September.
---------------------------------------------------------------------------

    Reduced form tools, by their nature, are subject to
uncertainty.\11\ In addition to the uncertainties present across the
entire emissions-to-impact modeling pathway, it is important to note
that the monetized benefit per ton estimates used here reflect the
geographic patterns of the underlying emissions and air quality
modeling assumptions used to create the reduced form health benefit per
ton values. Those assumptions do not necessarily reflect the conditions
of the policy scenario in which they are applied, which can lead to an
over- or underestimate of benefits. In this rule, for example, the
forgone benefits may be overstated in a location like Maine, because
there will be some transport of emissions offshore or to areas external
to the United States with different population and geographic
characteristics. See the Final Assessment Analysis prepared for this
rule for additional discussion regarding reduced form benefit per ton
values.\12\
---------------------------------------------------------------------------

    \11\ See EPA (2018). Technical Support Document: Estimating the
Benefit per Ton of Reducing PM2.5 Precursors from 17
Sectors. Office of Air and Radiation, Office of Air Quality Planning
and Standards, Research Triangle Park, February.
    \12\ See ``Final Assessment Analysis: Amendments Related to
Marine Diesel Engine Emission Standards,'' EPA memorandum from Jean
Marie Revelt, EPS, Kenneth Davidson, PS, and Margaret Zawacki, EE,
to Docket EPA-HQ-OAR-2018-0638, August 12, 2020.
---------------------------------------------------------------------------

V. Response to Comments

    As described in Section II, the proposed rule focused on providing
relief for specific applications where limited engine availability may
be preventing boat builders from making certain types of high-speed
vessels. The proposed rule accordingly described regulatory amendments
to allow additional lead time only for certain types of vessels, based
on several engine-related and vessel-related qualifying criteria.
    Section III describes the regulatory amendments for this final rule
and addresses comments that relate directly to those provisions. This
Section V addresses comments that apply more generally, or that are
outside the scope of the proposed rule.

A. Commenters Generally Supporting the Rule

    The Truck and Engine Manufacturers Association (EMA) and multiple
state organizations commented in support of the proposed rule to
provide Tier 4 relief for certain high-speed vessels. Maritime Partners
stated that they did not oppose the proposed rule. Each of these
comments also noted that EPA should not expand the relief beyond what
was proposed.
    In line with these comments, we are taking the approach of
finalizing the narrowly crafted relief from the proposed rule. Section
III describes how we made several minor adjustments following the
proposal. For example, the final rule--
     Includes vessels that are subject to Coast Guard
inspections as qualifying for relief.
     Allows boat builders to build vessels qualifying for
relief based on a less challenging requirement for minimum power
density.
     Specifies a lower power density to qualify for a reduced
useful life for certifying Tier 4 ``light-commercial'' engines.
     Adds an option to certify certain commercial engines with
the E5 duty cycle that previously was used only for certifying
recreational engines.

Each of these minor modifications from the proposal is intended to
ensure that the relief provisions will accomplish the intended
objective.

B. Commenters Wanting To Expand the Scope of Relief for High-Speed
Vessels

    Several boat builders and boat operators suggested that we broaden
the scope of the rule to provide additional relief for a wider range of
high-speed vessels for which certified Tier 4 engines were not
available. This included general recommendations to allow relief for
all high-speed vessels longer than 65' and for all emergency-response
vessels (or all publicly owned vessels). Some commenters also described
the need for relief for very specific applications, such as hovercraft
and catamarans with certain characteristics. Commenters also advocated
for allowing Phase 2 relief for vessels with metal hulls.
    To prepare the proposed rule, we did an in-depth investigation of
information, perspectives, constraints, and prospects for developments
related to the vessels and engines that we identified in the proposed
rule. That led us to carefully construct the qualifying criteria to
allow relief where the need was evident, and to disallow relief where
we expected vessel manufacturers to have access to Tier 4 engines that
were suitable for those applications. We also used available
information to determine the appropriate duration of the relief period

and to quantify the economic and environmental impacts of providing
relief for qualifying vessels and engines. The result was the proposed
arrangement of Phase 1 and Phase 2 qualifying criteria and the
corresponding schedule for delaying implementation of the Tier 4
standards.
    It is appropriate to focus this final rule on solving the problems
that were the basis of the proposed rule. This will allow us to quickly
finalize the relief for the vessels targeted in the proposed rule.
Repeating the process of defining qualifying criteria and setting an
appropriately revised implementation schedule for additional vessel
types would require additional information gathering and stakeholder
outreach.
    Commenters raised several concerns about boat builders' ability to
find and install Tier 4 engines in certain types of vessels. As
described in Section VII, we are not adopting relief in this rule to
address these concerns, but we are rather intending to further
investigate the need additional relief. If we pursue additional relief
for certain types of vessels, this would be in the form of a new
proposal that would consider the comments we received in the context of
this rule.
    A similar assessment applies for the comments describing a need for
lobster boats to be permanently excluded from Tier 4 requirements. We
are adopting the Phase 2 relief consistent with the proposed rule to
address what we know about concerns for building boats with Tier 4
engines. In any subsequent proposal, we would also consider revisiting
the decision in this rule to require installation of Tier 4 engines in
lobster boats and other vessels meeting the Phase 2 criteria starting
in 2024.

C. Commenters Opposed to the Rule

    Some commenters objected to providing any relief from the Tier 4
standards. We address each of these comments in the following sections
based on the main arguments presented.
1. General Issues
    The American Lung Association (ALA) and an anonymous commenter
stated that EPA should keep the Tier 4 standards as adopted to realize
the important environmental gains from improved emission control. They
argued that manufacturers have had enough time to produce compliant
engines and vessels, and that EPA should not revise the rules to reduce
costs to industry. MAN objected to EPA providing relief based on the
increased cost of Tier 4 engines in light of their understanding that
certifying engines to Tier 4 standards did not involve unreasonable
costs.
    Regarding ALA's comments on the forgone environmental benefits, we
quantified the estimated environmental impacts of this rule using the
methods and data we used in our 2008 final rule; see Section IV.
Allowing boat builders to use Tier 4 engines for a longer phase-in
period is expected to increase annual in NOx and PM10 \13\
emissions by about 108 and 2.3 short tons, respectively, in 2020 and
2021, when both sets of engines are affected, decreasing to 37 and 1
ton, respectively, in 2022 and 2023, when only engines 600-1,000 kW are
affected. EPA talked with several boat builders who indicated that they
simply cannot build boats at this time because certified Tier 4 engines
in the necessary power range are unavailable. This means that at least
some part of the fleet of commercial boats with high power density
engines is prevented from turning over to cleaner Tier 4 engines, and
that in at least some of these cases unregulated engines or Tier 1 or
Tier 2 engines with higher emission levels will continue to operate in
the fleet. While it is not possible to know how many of these previous-
tier vessels are not being replaced, it is reasonable to observe that
replacing these boats with new boats powered by Tier 3 engines is
preferable to having the older vessels continue in the fleet. This is
because the older vessels that need to be replaced are likely to have
engines that pre-date the Tier 3 standards: Tier 2 or, even more
likely, pre-control engines. As such, these vessels are likely to have
much higher emissions than vessels powered by Tier 3 engines. Replacing
these vessels with vessels powered by Tier 3 engines would reduce air
emissions from the sector.
---------------------------------------------------------------------------

    \13\ Consistent with the 2008 Rule, this inventory analysis is
for PM10. In the 2008 rule, PM2.5 was
estimated at 97% of PM10.
---------------------------------------------------------------------------

    Regarding MAN's comment on costs, the basis for the proposed
changes to the program was to respond to the concerns of boat builders
that they could not build new boats due to the non-availability of
compliant engines. EPA was aware of the challenges of certifying 600-
1400 kW engines when we adopted the 2008 rule, which was the basis for
allowing the greatest lead time for these engines. It is
straightforward to conclude that boat builders have not been able to
build the identified types of vessels because engine manufacturers had
not produced many of the same engine models in a Tier 4 configuration
that they had previously produced in a Tier 3 configuration for use in
these vessel types.
    EPA notes that MAN has recently certified a 24-liter engine with
high power density for use in commercial boat applications, and that
some additional lead time will be necessary for vessel builders to
incorporate this engine into their designs. We anticipate that further
developments in certifying additional engine models to Tier 4 standards
will make it possible to eventually realize most or all of the
anticipated emission reductions anticipated in the 2008 rule.
2. Availability of Suitable Tier 4 Engines
    MAN objected to EPA acknowledging widespread use of SCR in marine
applications, and then providing relief based on SCR not being
available for marine engines. More specifically, MAN argued that they
and other manufacturers have certified a range of Tier 4 engines that
provide suitable power options for the vessels EPA identified as
needing relief. MAN emphasized that EPA's relief provisions would
prevent them from being able to sell their Tier 4 engines after
investing substantially to certify their engines.
    EPA was not suggesting that SCR is not an appropriate technology
for marine engines. However, boat builders need engine manufacturers to
develop properly sized compliant engines and certify them to Tier 4
standards before they do the necessary design work to install those
engines into their vessels. In this rule, EPA is responding to the
engine manufacturers' delayed schedule for certifying Tier 4 engines.
Specifically, before the Tier 4 standards went into effect in 2017,
engine manufacturers offered several marine diesel engine models for
use in a wide variety of commercial boats. However, when the Tier 4
standards went into effect, the market was characterized by the absence
of certified engines. For whatever reason, engine manufacturers chose
not to carry out the development programs necessary to apply SCR or
other Tier 4 technology to these smaller engines and to certify those
engines in large enough quantities to maintain this section of the
marine diesel market. Our decision to propose relief was accordingly
based on the availability of certified engines, not on a judgment as to
whether SCR is an inappropriate technology for marine installations.
    Engine manufacturers have now certified 20-liter, 24-liter and 32-
liter engines to the Tier 4 standards (Table 4 identifies the Tier 4
engines that are available). Currently certified Tier 4 engines larger
than 32-liter reach high power density only for ratings well above
1,400 kW. We anticipate that engine manufacturers will certify

additional engine models with different displacements and power ratings
in the years ahead. The 65' pilot boat that Savannah Bar Pilots want to
build illustrates the need for relief. Vigor, the boat builder for
Savannah Bar Pilots, commented that this boat would not meet
performance specifications related to speed and annual operating hours
with 24-liter engines. Previous designs for this type of vessel
included a pair of 32-liter engines, which may give an appropriate
balance of power, weight, and durability, but 32-liter engines with
after treatment and associated hardware would require the boat builder
to substantially redesign the vessel. Boat builders need time to make
those changes to be able to build a boat that meets performance
specifications with the Tier 4 engine configuration. In recognition
that additional certified Tier 4 engines are now becoming available for
consideration by boat builders, EPA is providing only temporary,
limited relief from the Tier 4 standards.

                            Table 4--Currently Certified Tier 4 Engines Below 1400 kW
----------------------------------------------------------------------------------------------------------------
                                                                   Displacement    Maximum power   Power density
                          Manufacturer                               (liters)          (kW)         (kW/liter)
----------------------------------------------------------------------------------------------------------------
Yanmar..........................................................            20.4         670-749           33-37
MAN.............................................................           24.2L       746-1,066           31-44
Baudouin........................................................           32.1L       900-1,215           28-38
Caterpillar.....................................................             32L       746-1,082           23-35
Mitsubishi......................................................             49L             940              19
Caterpillar.....................................................           57.6L     1,000-1,772           17-31
----------------------------------------------------------------------------------------------------------------

3. Vessel Redesign for Lobster Boats
    MAN described their 24-liter engine as being a suitable option for
lobster boats if boat builders make a reasonable effort to redesign
vessels to account for the additional size and heat rejection
associated with exhaust after treatment.
    We have learned that a full-size lobster boat is normally 45-50'
long with a single 16-18 liter engine that has a power rating of 700-
750 kW. These Tier 4 engines with exhaust aftertreatment will require
boat builders to substantially redesign their vessels just to make room
for a larger engine package. That would be a considerable challenge
with 16-18 liter engines. Boat builders would not be able to install
the larger 24-liter engine with exhaust aftertreatment in these vessels
without extensive structural changes. The vessel redesign would also
need to address concerns about higher engine room temperatures, water
reversion that could damage SCR catalysts, and storing Diesel Exhaust
Fluid (DEF), among other things. Boat builders may be able to redesign
their vessels to address all these concerns, but they need to have
clear specifications from the engine manufacturers before they
undertake such redesign and, in any event, are not likely to be able to
successfully accomplish this for building boats in 2023 or earlier.
They may even need more lead time than we are adopting in this rule.
This is the basis to allow for the possibility that boat builders will
not be able to install Tier 4 engines in 2024 and later model years by
providing the waiver provisions discussed in Section III.D.
    It should be noted that some lobster boat builders (and boat
purchasers), faced with a requirement to install Tier 4 engines, may
choose instead to build a boat with a smaller engine certified to Tier
3 standards. Other boat owners may choose to keep their older boats
running instead of buying new boats with Tier 4 engines, and possibly
repowering with previous tier engines when needed.\14\ The purpose of
the relief provisions we are adopting in this rule is to avoid these
unintended consequences by giving engine manufacturers more time to
address the power needs for high-speed vessels while allowing boat
builders to continue to build boats with Tier 3 engines in the interim.
To the extent these unintended consequences would play out in the
marketplace in the absence of this rulemaking, there could be
associated cost and emission impacts in the absence of this rulemaking.
However, these costs are unclear and EPA's impacts assessment described
in Section IV only models costs and disbenefits directly related to
this rule.
---------------------------------------------------------------------------

    \14\ See EPA-HQ-OAR-2018-0638-0054 and EPA-HQ-OAR-2018-0638-
0055.
---------------------------------------------------------------------------

4. DEF Availability
    MAN commented that DEF is widely available and EPA should therefore
not extend compliance deadlines based on limited access to DEF.
    As described above, the proposed relief is based on the limited
availability of certified Tier 4 engines suitable for use in certain
high-speed vessels. Some commenters advocated for relief from Tier 4
emission standards based on limited access to DEF, but DEF supply and
infrastructure were not considered in the proposed rule. These issues
are therefore outside the scope of this rule.

D. River Towing

    The American Waterways Operators and some of its members commented
on the proposed rule to suggest that river pushboats also needed
additional time to comply with Tier 4 standards. Commenters mainly
cited reliability concerns for Tier 4 engines operating in a river
environment (i.e., operating at high load when pushing against the
river current, low load when operating with the river current), the
challenge of redesigning this type of vessel to use Tier 4 engines, the
additional complexity of operating and maintaining Tier 4 engines with
advanced electronic controls and aftertreatment, the limited available
Tier 4 engine models, and access to diesel exhaust fluid on inland
rivers. They also expressed concerns about the aggregate costs of
purchasing, installing, and using Tier 4 engines.
    These comments contrasted with those from Maritime Partners, who
said that engine manufacturers and multiple boat builders are actively
engaged with substantial investments to design and build river
pushboats with Tier 4 engines.
    We did not propose to make any changes to the Tier 4 standards or
implementation schedule for river pushboats and are therefore not in a
position to adopt relief provisions for those vessels in this rule. We
may take further action to address these concerns in any follow-on
action we consider as described in Section VII.

E. Replacement Engines

    Gladding-Hearn Shipbuilding and the Passenger Vessel Association
requested that we revise the regulation to allow vessel owners to
replace old engines

under the replacement engine exemption under 40 CFR 1068.240, but keep
the old engine as a spare to minimize downtime in anticipation of an
emergency engine failure. The commenters stated that such an engine
failure without a spare engine could be economically devastating.
    These commenters are describing ``swing'' engines. EPA clarified
our approach to swing engines in our 2008 rulemaking in response to the
concerns of commenters on that rule (73 FR 37158, June 30, 2008). Some
ship owners said that they currently use swing engines in their regular
operations and that the application of our replacement engine
provisions would prevent them from continuing this practice. In our
2008 rule, we clarified that we allow swing engines as a maintenance
practice when the swing engines are additional engines purchased at the
time the vessel is constructed and are clearly intended to be part of
an engine maintenance strategy for that vessel. In a qualifying swing
engine fleet, when one of the vessel's engines is due for rebuild, it
is removed from the vessel and replaced with an engine from the swing
engine group. The removed engine is rebuilt and then becomes the next
swing engine. The swing engine must be the same emission tier as the
original engine on the vessel, and it is subject to EPA's marine diesel
engine remanufacturing requirements when it is rebuilt. Note that if a
swing engine is replaced with a new engine, both engines are subject to
the engine replacement provisions in 40 CFR 1042.615 and 1068.240.
    The commenters are requesting that they be allowed to designate an
engine as a swing engine at the time the engine is replaced, by
retaining the rebuilt original engine, thus exempting the engine from
the provisions for new replacement engines. We disagree with this
request, as it undermines the purpose of the replacement engine
provisions in our marine diesel engine program. Currently, if an owner
installs a new replacement engine, the new engine must meet the most
stringent tier of standards feasible for installation on a boat.\15\
Thus, a new replacement engine for a vessel built in 1995 would need to
meet at least Tier 3, unless it can be established that a Tier 3 engine
cannot be used in the vessel because of the physical or performance
needs of the vessel, at which point a Tier 2 engine must be considered,
and then a Tier 1 engine. Because new replacement engines prolong the
life of older vessels and delay the turnover of the fleet to cleaner
engines, this requirement is an important means of making incremental
improvements in emission controls from the marine fleet.
---------------------------------------------------------------------------

    \15\ As stated in 40 CFR 1042.615, EPA has determined that
engines certified to Tier 4 standards do not have the appropriate
physical or performance characteristics to replace uncertified
engines or engines certified to emission standards that are less
stringent than the Tier 4 standards.
---------------------------------------------------------------------------

    In the context of swing engines, if an engine in the fleet
experiences engine failure, the owner would remove the failed engine,
install the swing engine, and use the exemption for new replacement
engines to become the next swing engine. This would require returning
the failed engine to the engine manufacturer as a core exchange. The
engine manufacturer may restore the failed engine to a working
condition and resell it, subject to the conditions that apply under 40
CFR 1068.240. The regulation does not allow the owner to retain
ownership of the original engine after it has been replaced with an
exempted engine under 40 CFR 1068.240, even if it could otherwise be
rebuilt for use as a swing engine.
    Note that if the owner is replacing the old engine with a used
engine, rather than a new engine, the only regulatory constraint is
that the replacement engine may not be certified to a lesser tier of
standards than the engine it is replacing (see 40 CFR 1068.120).
However, that used engine may be subject to EPA's marine diesel engine
remanufacture program when it is rebuilt (see 40 CFR part 1042, subpart
I).
    These comments on replacement engines are outside the scope of the
proposed rule. However, we want to take the opportunity to emphasize
that EPA's swing engine program is well established and that the Agency
has no plans to revise those regulatory provisions.

F. Other Comments

    State groups submitted comments stating that EPA would need to
adopt alternative control measures to make up for forgone emission
reductions that are already in state plans for meeting air quality
standards. We originally adopted emission standards for marine diesel
engines to comply with our Clean Air Act authority to set emission
standards requiring the greatest achievable degree of emission control.
The relief provisions we are adopting are based on this same assessment
of what is feasible. We will consider every opportunity to require
emission reductions from marine diesel engines and other sectors, but
emissions accounting does not change our assessment of what boat
builders can do to comply with the Tier 4 standards.
    The National Association of Clean Air Agencies (NACAA) encouraged
us to prioritize and take action to establish more stringent marine
emission standards for engines below 600 kW, and to consider adopting
emission standards that harmonize with more stringent standards that
apply outside the United States where possible. Our 2008 final rule
described the challenges associated with applying Tier 4 standards to
commercial marine engines below 600 kW and the boats that use them and,
to our knowledge, these challenges have not been resolved. EPA does not
have plans to revisit those emission standards at this time; however,
we will continue to evaluate whether or when it is appropriate to apply
more stringent emission standards for engines below 600 kW. Similarly,
we will continue to evaluate whether or when it is appropriate to adopt
more stringent emission standards that would allow engine manufacturers
to make a single low-emission engine that simultaneously complies with
emission standards adopted by multiple regulating agencies.
    EMA commented that dedicated direct-drive fire pumps should be
permanently exempted from Tier 4 standards because their use is limited
to emergency operations (plus limited maintenance and testing). EMA
provided no detailed justification for not meeting Tier 4 standards and
provided no information that would help us assess the economic or
environmental impacts of such a change to the regulation. This comment
is outside the scope of this rulemaking. We are not taking action in
this final rule to address the request.
    NACAA recommended that we provide a more geographically resolved
estimation of the lost emission reductions, at least on the regional
level. We have concluded that it is not possible to provide a more
geographically resolved estimation of the forgone emission reductions
without knowing the precise location of the boats that take advantage
of the additional lead time. As explained in the economic and
environmental impacts analysis prepared for this rule, we estimate that
if all the annual emissions for the 600-1,000 kW engines are attributed
to Maine, the forgone emissions from Tier 4 relief would amount to
about 0.4 percent and 0.1 percent of those state-wide NOX
and PM10 emissions, respectively. Similarly, if all the
annual emissions for 600-1,000 kW engines are attributed to Georgia,
the forgone emissions from Tier 4 relief would amount to about 0.13
percent and

0.03 percent of those state-wide NOX and PM10
emissions, respectively.\16\
---------------------------------------------------------------------------

    \16\ See ``Final Assessment Analysis: Amendments Related to
Marine Diesel Engine Emission Standards,'' EPA memorandum from Jean
Marie Revelt, EPA, Kenneth Davidson, PS, and Margaret Zawacki, EE,
to Docket EPA-HQ-OAR-2018-0638, August 12, 2020.
---------------------------------------------------------------------------

VI. Regulatory Alternatives

    The proposed rule described the basis for pursuing additional lead
time for meeting Tier 4 requirements for certain engines and vessels
where it was apparent that there was no feasible path for compliance.
The relief provisions in this rule are narrowly crafted to address the
concerns communicated by boat builders leading up to the proposed rule.
These provisions include a waiver process for vessels meeting the Phase
2 criteria as described in Section III.B for 2024 and beyond. In the
proposal, we also requested comment on an alternative approach of
adopting a new Tier 4 start date of 2028 for vessels meeting the Phase
2 criteria.
    As described in Section V, adding several years of lead time would
not be an effective way to support the engine manufacturers'
development and certification programs for Tier 4 engines. The waiver
process is preferable because it allows us to limit relief in 2024 and
later to cases in which there are no suitable engines certified to the
Tier 4 standards. If an engine manufacturer certifies an engine model
that is suitable for powering vessels that would otherwise meet the
specified Phase 2 criteria, it would be appropriate to deny the waiver
request.
    We have calculated the emission impacts associated with an
alternative 2028 Tier 4 start date for vessels meeting the Phase 2
criteria.\17\ Adopting this regulatory alternative would have increased
the estimated total forgone inventory benefits of the proposal by about
1,760 additional short tons of NOX and 37 additional short
tons of PM10 above the estimated inventory increases
associated with the final program adopted in this final rule. Using
reduced form health benefit per ton values, we estimate that the annual
PM2.5-related forgone benefits for this regulatory
alternative could be up to a high-end estimate of $4.4 million in any
given year (2015$, 3% discount rate, mortality effect estimate derived
from Lepeule et al., 2012). The total present value of the stream of
forgone benefits ranges from $13.5 million to $44.6 million. The
estimated cost savings would increase by $3.3 million, using a
behavioral modeling approach, or $3.6 million, using a full-cost, pass-
through approach (2015$), over the estimated cost savings associated
with the final adopted program.
---------------------------------------------------------------------------

    \17\ See ``Final Assessment Analysis: Amendments Related to
Marine Diesel Engine Emission Standards,'' EPA memorandum from Jean
Marie Revelt, EPA, Kenneth Davidson, PS, and Margaret Zawacki, EE,
to Docket EPA-HQ-OAR-2018-0638, August 12, 2020.
---------------------------------------------------------------------------

VII. Plans for Further Action

    In response to our proposal, we received several comments from
industry stakeholders who indicated that relief is also needed for
other vessel types. These include catamarans, hovercraft, some types of
emergency response boats, and push boats. Specifically, hovercraft have
design specifications for lifting the vessel up out of the water that
require engines to fall into a narrow range of power, size, and weight.
Similarly, catamarans with hydrofoils need to use light-weight
components and materials to achieve the lift necessary to operate
properly. Also, fire boats and other emergency response vessels
sometimes need to achieve very high speeds, which in turn requires very
compact and light-weight engines with very high power output. For these
and similar applications, boat builders indicated that they may not be
able to move ahead with new construction with available Tier 4 engines.
    The issues raised by these commenters are complex. It will take
some time to carefully consider an appropriate policy direction and, if
necessary, prepare a new proposal with specific additional relief
provisions. Rather than delay the relief as described in the proposed
rule, we will consider the issues raised by these stakeholders
separately. As a result, we will continue to consider whether and how
to formulate Tier 4 relief provisions for these vessels. We will be
reaching out to stakeholders to better understand their concerns and
determine whether we can develop a set of narrow qualifying criteria to
allow relief where it is needed while continuing to require
installation of Tier 4 engines where relief is not needed. The
appropriate measure for evaluating the need for relief is whether
certified Tier 4 engines will be available with the appropriate power
characteristics to meet performance specifications, after accounting
for reasonable measures to redesign vessels to account for engines with
exhaust aftertreatment.
    In this future assessment, we will need to take into consideration
currently certified engines and the efforts that engine manufacturers
intend to make to certify relevant engines in the foreseeable future.
We will need to carefully assess the expected range of available
engines, both to determine which vessels warrant relief and to
determine how long the relief period should be.
    Finally, we will also consider whether further changes to
certification requirements are necessary to encourage greater
availability of relevant engines. This is of particular concern for
engines with total displacement below 20 liters, where the absence of
Tier 4 certified engines is most pronounced. In our assessment, we will
also consider the progress that engine manufacturers have made toward
certifying marine diesel engines to the IMO Tier III or EU Stage V
standards. Our assessment may also include consideration of adjusting
NOX, HC, CO, or PM standards, revising the durability
testing provisions for certification, and expanding the scope of Tier 4
to apply to engines below 600 kW.
    In any future action, we would also consider whether to make
further regulatory changes to address the request for a long-term and
sustainable set of requirements for lobster boats and similarly
affected vessels.
    As described in Section V, some operators of river boats continue
to be concerned about complying with Tier 4 requirements. These
concerns are very different than those that apply to installing Tier 4
engines in high-speed vessels. Rather, boat builders and operators will
need time to work out design, installation, and operational issues with
newly configured engines in a river environment. We will continue to
monitor progress toward compliance for river pushboats that are subject
to Tier 4 requirements. We will also learn, along with the industry,
how Tier 4 compliance requirements are affecting the ability of
operators to safely and effectively deliver products on the inland
waterway system.

VIII. Statutory and Executive Order Reviews

    Additional information about these statutes and Executive Orders
can be found at http://www2.epa.gov/laws-regulations/laws-and-executive-orders.

A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review

    This is a significant regulatory action that was submitted to the
Office of Management and Budget (OMB) for review. Any changes made in
response to OMB recommendations have been documented in the docket.

B. Executive Order 13771: Reducing Regulations and Controlling
Regulatory Costs

    This action is considered an Executive Order 13771 deregulatory
action. Details on the estimated cost savings of this final rule can be
found in EPA's analysis of the projected costs and benefits associated
with this action.

C. Paperwork Reduction Act (PRA)

    The information collection activities in this rule have been
submitted for approval to the Office of Management and Budget (OMB)
under the PRA. The Information Collection Request (ICR) document that
the EPA prepared has been assigned EPA ICR number 2602.02. You can find
a copy of the ICR in the docket for this rule, and it is briefly
summarized here. The information collection requirements are not
enforceable until OMB approves them. OMB has previously approved the
information collection activities related to marine diesel engine
emission standards in 40 CFR part 1042 under OMB control number 2060-
0287.
    Information collection is limited to manufacturers of qualifying
high-speed vessels requesting a waiver from the Tier 4 standards after
the standards restart in model year 2024. We are adopting this as a
precaution, in case engine certification and further technology
development for installing Tier 4 engines does not allow for complying
with standards in 2024. We will protect confidential business
information as described in 40 CFR part 2.
    Respondents/affected entities: Manufacturers of high-speed vessels.
    Respondent's obligation to respond: Response is required to get
EPA's approval for a waiver from Tier 4 standards.
    Estimated number of respondents: 0.
    Frequency of response: There are no recurring responses.
    Total estimated burden: 0 hours (per year). Burden is defined at 5
CFR 1320.3(b).
    Total estimated cost: $0 per year, including $0 per year in
annualized capital or operation & maintenance costs.
    An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for the
EPA's regulations in 40 CFR are listed in 40 CFR part 9.

D. Regulatory Flexibility Act (RFA)

    I certify that this action will not have a significant economic
impact on a substantial number of small entities under the RFA. In
making this determination, the impact of concern is any significant
adverse economic impact on small entities. An agency may certify that a
rule will not have a significant economic impact on a substantial
number of small entities if the rule relieves regulatory burden, has no
net burden, or otherwise has a positive economic effect on the small
entities subject to the rule. This rule is expected to provide
regulatory flexibility to small owners and operators of U.S. vessels.
We have therefore concluded that this action will have no net
regulatory burden for any directly regulated small entities.

E. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded mandate as described in
UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect
small governments. The action imposes no enforceable duty on any state,
local, or tribal governments or the private sector.

F. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have
substantial direct effects on the states, on the relationship between
the national government and the states, or on the distribution of power
and responsibilities among the various levels of government.

G. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments

    This action does not have tribal implications as specified in
Executive Order 13175. This rule will be implemented at the Federal
level and affects owners and operators of U.S. vessels. Thus, Executive
Order 13175 does not apply to this action.

H. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks

    This action is not subject to Executive Order 13045 because it is
not economically significant as defined in Executive Order 12866, and
because the EPA does not believe the environmental health or safety
risks addressed by this action present a disproportionate risk to
children. This action's health and risk assessments are described in
Section IV.

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

    This action is not a ``significant energy action'' because it is
not likely to have a significant adverse effect on the supply,
distribution, or use of energy. This action provides relief from
current emission standards for a small number of vessels and
streamlines the process for certifying engines. None of these changes
are expected to significantly affect energy supply, distribution, or
use. Section IV describes how we expect this rule to have a small
overall environmental impact.

J. National Technology Transfer and Advancement Act (NTTAA)

    This rulemaking does not involve technical standards.

K. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations, and Low-Income Populations

    This action does not have disproportionately high and adverse human
health or environmental effects on minority populations, low-income
populations or indigenous peoples, as specified in Executive Order
12898 (59 FR 7629, February 16, 1994). Section IV describes how this
action will have a very small impact on all populations.

L. Congressional Review Act (CRA)

    This action is subject to the CRA, and EPA will submit a rule
report to each House of the Congress and to the Comptroller General of
the United States. This action is not a ``major rule'' as defined by 5
U.S.C. 804(2).

List of Subjects in 40 CFR Part 1042

    Environmental protection, Administrative practice and procedure,
Air pollution control, Confidential business information, Imports,
Labeling, Penalties, Reporting and recordkeeping requirements, Vessels,
Warranties.

Andrew Wheeler,
Administrator.
    For the reasons set forth above, EPA amends 40 CFR part 1042 as
follows:

PART 1042--CONTROL OF EMISSIONS FROM NEW AND IN-USE MARINE
COMPRESSION-IGNITION ENGINES AND VESSELS

0
1. The authority citation for part 1042 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

0
2. Section 1042.145 is amended by adding paragraphs (k) through (o) to
read as follows:

Sec.  1042.145   Interim provisions.

* * * * *
    (k) Adjusted implementation dates for Tier 4 standards. Engines and
vessels may qualify for delaying the Tier 4

standards specified in Sec.  1042.101 as follows:
    (1) The delay is limited to model year 2021 and earlier engines and
vessels that meet all the following characteristics:
    (i) Category 1 propulsion engines with specific power density above
27.0 kW/liter, up to maximum engine power of 1,400 kW.
    (ii) Vessels have total propulsion power at or below 2,800 kW.
    (iii) Vessel waterline length is at or below 65 feet.
    (iv) Vessels have a maximum speed (in knots) at or above 3.0
[middot] L1/2, where L is the vessel's waterline length, in feet.
    (2) The delay also applies through model year 2023 for engines and
vessels that meet all the following characteristics:
    (i) Category 1 propulsion engines with specific power density above
35.0 kW/liter, up to maximum engine power of 1,000 kW.
    (ii) Vessels have total propulsion power at or below 1,000 kW.
    (iii) Vessel waterline length is at or below 50 feet.
    (iv) Vessels have a maximum speed (in knots) at or above 3.0
[middot] L1/2, where L is the vessel's waterline length, in feet.
    (v) Vessels have fiberglass or other nonmetal hulls.
    (3) Vessel manufacturers must have a contract or purchase agreement
signed before the end of the relief period for each vessel produced
under this paragraph (k).
    (4) Affected engines must instead be certified to the appropriate
Tier 3 emission standards specified in Sec.  1042.101. Engine
manufacturers may include engine configurations with maximum engine
power below 600 kW in the same engine family even if the power density
is below the value specified in paragraph (k)(1) or (2) of this
section.
    (5) If you introduce an engine into U.S. commerce under this
section, you must meet the labeling requirements in Sec.  1042.135, but
add the following statement instead of the compliance statement in
Sec.  1042.135(c)(10):
    THIS MARINE ENGINE COMPLIES WITH U.S. EPA TIER 3 EMISSION STANDARDS
UNDER 40 CFR 1042.145(k). ANY OTHER INSTALLATION OR USE OF THIS ENGINE
MAY BE A VIOLATION OF FEDERAL LAW SUBJECT TO CIVIL PENALTY.
    (l) [Reserved]
    (m) Tier 4 waiver. Starting with model year 2024, vessel
manufacturers may request an exemption from the Tier 4 standards as
follows:
    (1) The subject vessels and engines must meet the qualifications of
paragraph (k)(2) of this section.
    (2) Vessel manufacturers must send a written request for the
exemption to the Designated Compliance Officer. The request must
describe efforts taken to identify available engines certified to the
Tier 4 standards, describe design efforts for installing engines in the
subject vessels, identify the number of vessels needing exempt engines,
demonstrate that the vessel cannot meet essential performance
specifications using available Tier 4 engines, and state that engine
and vessel manufacturers will meet all the terms and conditions that
apply. We may approve an exemption from the Tier 4 standards based on
the submitted information.
    (3) Engine manufacturers may ship exempt engines under this
paragraph (m) only after receiving a written request from a vessel
manufacturer who has received our written approval to build a specific
number of vessels. The prohibitions in 40 CFR 1068.101(a)(1) do not
apply to a new engine that is subject to Tier 4 standards, subject to
the following conditions:
    (i) The engine meets the appropriate Tier 3 emission standards in
Sec.  1042.101 consistent with the provisions specified in 40 CFR
1068.265.
    (ii) The engine is installed on a vessel consistent with the
conditions of this paragraph (m).
    (iii) The engine meets the labeling requirements in Sec.  1042.135,
with the following statement instead of the compliance statement in
Sec.  1042.135(c)(10):
    THIS MARINE ENGINE DOES NOT COMPLY WITH CURRENT U.S. EPA EMISSION
STANDARDS UNDER 40 CFR 1042.145(m). ANY OTHER INSTALLATION OR USE OF
THIS ENGINE MAY BE A VIOLATION OF FEDERAL LAW SUBJECT TO CIVIL PENALTY.
    (n) Assigned deterioration factors. Engine manufacturers may use
assigned deterioration factors for certifying Tier 4 engines with
maximum power up to 1,400 kW, as follows:
    (1) For engine families that have at least one configuration with
maximum engine power at or below 1,400 kW and power density above 30.0
kW/liter, you may use assigned deterioration factors through model year
2024.
    (2) For engine families that have at least one configuration with
maximum engine power at or below 1,000 kW and power density above 30.0
kW/liter, you may use assigned deterioration factors through model year
2026.
    (3) The assigned deterioration factors are multiplicative values of
1.1 for NOX and 1.4 for HC and CO, and an additive value of
0.003 g/kW-hr for PM, unless we approve your request to use different
values. We will approve your proposed values if we determine based on
data from similar engines and supporting rationale you submit with your
request that they better represent your engines.
    (o) Useful life for light-commercial engines. You may certify
commercial Category 1 engines at or above 600 kW with power density
above 45.00 kW/liter to the exhaust emission standards of this part
over a full useful life of 10 years or 5,000 hours of operation instead
of the useful-life values specified in Sec.  1042.101(e). Engines
certified to this shorter useful life must be in their own engine
family.

0
3. Section 1042.505 is amended by revising paragraphs (b) introductory
text and (b)(2) to read as follows:

Sec.  1042.505   Testing engines using discrete-mode or ramped-modal
duty cycles.

* * * * *
    (b) Measure emissions by testing the engine on a dynamometer with
the following duty cycles (as specified) to determine whether it meets
the emission standards in Sec.  1042.101 or Sec.  1042.104:
* * * * *
    (2) Duty cycle for engines with high power density. Except as
specified in paragraph (b)(3) of this section, use the 5-mode duty
cycle or the corresponding ramped-modal cycle described in paragraph
(b) of Appendix II of this part for light-commercial engines and
recreational marine engines with maximum engine power at or above 37
kW. You may also use this duty cycle for other commercial engines
instead of the duty cycle specified in paragraph (b)(1) of this section
if the power density for every configuration in an engine family is
above 30.0 kW/liter.
* * * * *

0
4. Section 1042.901 is amended by adding definitions in alphabetical
order for ``Light-commercial marine engine'' and ``Waterline length''
to read as follows:

Sec.  1042.901   Definitions.

* * * * *
    Light-commercial marine engine means a Category 1 propulsion marine
engine at or above 600 kW with power density above 45.0 kW/liter that
is certified with a shorter useful life based on its high power
density.
* * * * *
    Waterline length means the horizontal distance measured between
perpendiculars taken at the forwardmost and aftermost points on the
waterline

corresponding to the deepest operating draft (see ``Length between
perpendiculars'' at 46 CFR 175.400). This applies for a worst-case
combination of a fully loaded vessel in freshwater in summer.
* * * * *
[FR Doc. 2020-18621 Filed 10-1-20; 8:45 am]
BILLING CODE 6560-50-P