also added the requirement that SIPs contain NNSR provisions as set
forth in Part D. Additionally, Congress provided that Appendix S
would govern preconstruction permitting in nonattainment areas
lacking approved part D SIPs before a construction ban went into
effect. When Congress removed the construction ban via the 1990 CAA
Amendments (except as provided for in CAA section 110(n)(3)), it
left in place the use of the interim NNSR program under Appendix S.
---------------------------------------------------------------------------

    Accordingly, states with newly designated nonattainment areas for
the revised primary PM2.5 NAAQS have two possible means by
which they can implement NNSR requirements for PM2.5
following the effective date of designations and until the EPA approves
a SIP submission meeting the NNSR requirements for PM2.5
promulgated in this rule. First, any state that already has a SIP-
approved NNSR program for PM2.5 (e.g., where the state has
had other PM2.5 nonattainment areas for which the EPA has
approved an NNSR program) should continue to apply those permitting
requirements in the interim. Second, any state that lacks an approved
NNSR program for PM2.5 may rely upon the NNSR provisions in
Appendix S until the EPA approves that

state's SIP submission in order to ensure that proposed new major
stationary sources and major modifications for PM2.5 in
newly designated PM2.5 nonattainment areas undergo the
appropriate type of preconstruction review in the interim.
    a. General Applicability. Stationary sources are considered to be
``major'' sources based on the amount of a given pollutant (or a
precursor for that pollutant) the source emits or has the potential to
emit, as defined by the statute. New major stationary sources are
subject to the NNSR requirements when they are major for the pollutant
(or a precursor for that pollutant) for which an area is designated
nonattainment. See 40 CFR 51.165(a)(2)(i). With regard to major
modifications, NNSR applies to proposed physical changes or changes in
the method of operation of an existing stationary source that (1) is
major for the nonattainment pollutant (or a precursor for that
pollutant) and (2) results in both a significant emissions increase and
a significant net emissions increase of that same nonattainment
pollutant (or same precursor for that pollutant).\207\
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    \207\ See 40 CFR 51.165(a)(1)(v)(A), (a)(2)(ii)(A). As will be
explained in ensuing discussions, the nonattainment pollutant and
any applicable precursors for that pollutant are considered
separately for NNSR applicability purposes.
---------------------------------------------------------------------------

    For each proposed new major stationary source and major
modification, the general NNSR requirements to be included in a state's
SIP include the following: (i) The installation and continuous
operation of pollution control technology that complies with the Lowest
Achievable Emission Rate (LAER); (ii) the acquisition of creditable
emissions reductions to adequately offset the proposed emissions
increase of the nonattainment pollutant; and (iii) a certification that
all other sources owned by the applicant are complying with all
applicable requirements of the
    CAA.\208\ These NNSR requirements apply as of the effective date of
the designation of an area as nonattainment for the pollutant and must
be satisfied by a proposed major new source or major modification
locating in such area as a prerequisite for obtaining a NNSR permit.
---------------------------------------------------------------------------

    \208\ The basic NNSR requirements are set forth in CAA section
173 of subpart 1. Subpart 4 adds a more stringent definition of
``major source'' for PM10 sources locating in
PM10 nonattainment areas classified as Serious and sets
forth provisions for the regulation and potential exemption from
regulation of major sources of PM10 precursors in
PM10 nonattainment areas. Until the decision in NRDC v.
EPA was issued, the additional subpart 4 requirements had not been
directly applied to PM2.5.
---------------------------------------------------------------------------

    b. Historical Overview of NNSR for PM10 and PM2.5 National Ambient
Air Quality Standards (NAAQS). The EPA revised the PM NAAQS in 1997,
establishing new annual and 24-hour NAAQS using PM2.5
particles as a new indicator, while retaining the NAAQS for
PM10.\209\ In 2006, the EPA again revised the suite of PM
NAAQS by tightening the 24-hour PM2.5 standards and
retaining the level of the annual PM2.5 standards.\210\ In
2008, the EPA issued the PM2.5 NSR Rule that established
various provisions ensuring that proposed new major stationary sources
or major modifications of sources of direct PM2.5 emissions
or emissions of applicable PM2.5 precursors would be
required to undergo preconstruction review.\211\ The EPA included
specific provisions in the 2008 PM2.5 NSR Rule that apply
when such sources are located in a designated PM2.5
nonattainment area. Unlike the NNSR requirements for PM10
developed under subpart 4, the EPA determined that the applicable
implementation requirements for the PM2.5 NAAQS were limited
to the general nonattainment provisions under subpart 1.
---------------------------------------------------------------------------

    \209\ See 62 FR 38652 (July 18, 1997).
    \210\ See 71 FR 61144 (October 17, 2006).
    \211\ See 73 FR 28321 (May 16, 2008).
---------------------------------------------------------------------------

    With regard to NSR applicability for PM2.5 precursors in
the 2008 PM2.5 NSR Rule, the EPA recognized that, under the
appropriate conditions, NOX, SO2, VOC and ammonia
could each contribute to the formation of PM2.5 in the
ambient air. However, the EPA issued regulations that did not require
states to subject all of these precursors to regulation as part of the
attainment plan or NSR permitting requirements applicable in a given
nonattainment area.\212\ Instead, the EPA established the initial
presumptions for nonattainment areas that SO2 and
NOX should be regulated precursors for PM2.5, but
VOC and ammonia need not be regulated precursors.\213\
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    \212\ See 72 FR 20589.
    \213\ In the 2008 PM2.5 NSR Rule, the EPA concluded
that SO2 should be regulated as a precursor for
PM2.5 in all areas. In addition, the EPA or the states
could rebut the initial presumptions regarding NOX, VOC
or ammonia on an area-by-area basis with a demonstration approved by
the Administrator and thus reverse any of those presumptions in the
state's implementation plan for that area. See 73 FR 28327.
---------------------------------------------------------------------------

    As described in Section II.B of this preamble, in January 2013 the
court's decision in NRDC v. EPA held that the EPA erred in implementing
the PM2.5 NAAQS under the general implementation
requirements in subpart 1, rather than relying on the implementation
requirements specific to PM10 in subpart 4 of the CAA.
Accordingly, the court directed the EPA to comply with the requirements
of subpart 4 when developing implementing regulations for
PM2.5 nonattainment areas.
    The NRDC decision has specific implications for implementing the
NNSR program for PM2.5. Two provisions of subpart 4 impose
additional requirements on NNSR plans developed to address sources
locating in areas designated nonattainment for PM2.5. The
first relates to the definition of ``major stationary source'' that
applies to areas initially designated as Moderate nonattainment areas
and subsequently reclassified as Serious. In such areas, section
189(b)(3) of the CAA defines the major source threshold as 70 tpy of
PM10. The second relevant subpart 4 provision governs the
treatment of major sources of PM10 precursors. As previously
described in Section III of this preamble, section 189(e) of the CAA
requires that the control requirements applicable to major stationary
sources of PM10 also apply to major stationary sources of
PM10 precursors, unless the Administrator determines that
such sources of PM10 precursors do not contribute
significantly to PM10 levels that exceed the standard in
that area. The EPA's proposed amendments to address the subpart 4
requirements with respect to PM2.5 and the EPA's responses
to comments received on its proposal are summarized in the relevant
subsections later.
    It is worth noting that the 2008 PM2.5 NSR Rule
promulgated new NSR requirements for implementation of PM2.5
in both nonattainment areas (NNSR) and attainment/unclassifiable areas
(PSD). As subpart 4 includes requirements only pertinent to
nonattainment areas, the EPA does not consider the portions of the 2008
PM2.5 NSR Rule that address requirements for
PM2.5 attainment and unclassifiable areas to be affected by
the court's opinion in NRDC v. EPA. Therefore, the EPA did not propose
to revise any PSD requirements promulgated in the 2008 PM2.5
NSR Rule in order to comply with the court's decision.

B. Final NNSR Requirements for PM2.5 Nonattainment Areas

    This section provides a description of the changes that the EPA is
making to the NNSR requirements for PM2.5 that are contained
in 40 CFR 51.165, which provides the minimum requirements for a NNSR
program under an approved implementation plan, and in Appendix S, which
serves as an interim NNSR permitting program pending approval of

a state's SIP to address NNSR requirements for a particular pollutant.
    For both sets of regulations, we will describe the changes that
were proposed, the final requirements, the comments received, and the
EPA's responses to them.
1. 40 CFR 51.165
    In this final rule, as explained in more detail later, the EPA is
making the following revisions that affect the NNSR regulations for
PM2.5 at 40 CFR 51.165: (a) Amending the definition of
``regulated NSR pollutant'' with regard to PM2.5 precursors;
(b) amending the definition of ``major stationary source'' with regard
to major sources of direct PM2.5 emissions and
PM2.5 precursors locating in PM2.5 nonattainment
areas classified as Moderate and Serious; (c) amending the definition
of ``significant'' with regard to emissions of PM2.5
precursors; and (d) codifying the EPA's policy for determining whether
a source is ``major'' for PM2.5 with regard to emissions of
direct PM2.5 and its precursors.
    Also, the EPA explains in this section that it is codifying the
schedule for states to submit NNSR SIP revisions for PM2.5
that meet the requirements of 40 CFR 51.165. The schedules for
submitting revised NNSR programs for PM2.5 for Moderate and
Serious areas are not contained in 40 CFR 51.165 NNSR regulations but
in new 40 CFR 51.1003(a) and (b), respectively.
a. Definition of ``regulated NSR pollutant''--PM2.5
Precursors
i. Summary of Proposal
    CAA section 189(e) requires that the control requirements
applicable to major stationary sources of PM10 also apply to
major stationary sources of PM10 precursors, unless the
Administrator determines that such sources of PM10
precursors do not contribute significantly to PM10 levels
that exceed the standard in that area. In order to align the NNSR
regulations for PM2.5 with the requirements of CAA section
189(e), the EPA proposed several amendments to certain definitions
within 40 CFR 51.165, as explained in the subsections that follow, in
order to regulate all four identified PM2.5 precursors
consistent with the statute.\214\ The EPA proposed to revise the NNSR
definition of ``regulated NSR pollutant'' to include SO2,
NOX, VOC and ammonia as regulated PM2.5
precursors.
---------------------------------------------------------------------------

    \214\ The EPA explained earlier in this preamble that the
court's 2013 decision in NRDC v. EPA reasoned that the EPA's
approach to precursors in the 2007 and 2008 PM2.5
regulations had the effect of reversing the presumption embodied
with subpart 4 at CAA section 189(e) that a state should regulate
major sources of all PM precursors unless the state has made a
specific showing why regulation of sources of a particular precursor
is not necessary.
---------------------------------------------------------------------------

    The EPA also proposed to add language to the definition of
``regulated NSR pollutant'' to address the provision of CAA section
189(e) that allows an exemption from the NNSR permit requirements for
major stationary sources or major modifications of a particular
precursor if the state demonstrates to the satisfaction of the EPA that
major stationary sources of such precursor do not contribute
significantly to PM2.5 levels that exceed the
PM2.5 ambient standards in a particular nonattainment area.
In Section III of the preamble of the proposal, the EPA proposed and
sought comment on several policy approaches that a state could use to
make the necessary demonstration that would enable the state to exempt
sources of a particular precursor from being regulated under the
attainment plan for a particular PM2.5 nonattainment area
altogether or from individual components of that plan, including the
NNSR permitting requirements. See 80 FR 15350-62.
ii. Final Rule
    The EPA is amending the definition of ``regulated NSR pollutant''
at 40 CFR 51.165 to include a new provision stating that
SO2, NOX, VOC and ammonia are PM2.5
precursors in any PM2.5 nonattainment area. See 40 CFR
51.165(a)(1)(xxxvii)(C)(2). The EPA is also providing in this final
rule that sources of a particular precursor may be exempted from the
NNSR control requirements via a demonstration approved by the
Administrator showing that new major stationary sources and major
modifications of a particular precursor would not contribute
significantly to levels of PM2.5 that exceed the standard in
a particular nonattainment area. It is noted, however, that the
exemption provision is not being codified within the definition of
``regulated NSR pollutant'' as originally proposed. Instead, this
exemption provision is contained in a new paragraph 51.165(a)(13),
which is based on CAA section 189(e) and provides generally that the
control requirements applicable to new major stationary sources and
major modifications of PM2.5 are also applicable to new
major stationary sources and major modifications of PM2.5
precursors.
    In addition, the provision has also been revised to focus on the
exemption of control requirements for sources of a particular precursor
rather than the exemption of the precursor itself. The EPA believes
that this shift in focus is more consistent with the statutory language
at CAA section 189(e), which also focuses on the exemption of sources
from the control requirements for that precursor. As explained in
Section III of this preamble, the EPA has defined a precursor
demonstration specifically for exempting major sources of a particular
precursor from regulation under the NNSR program. This demonstration
involves a sensitivity-based analysis that evaluates the sensitivity of
ambient PM2.5 concentrations in a nonattainment area to
increases of precursor emissions resulting from potential major source
growth in the area. The EPA intends to issue a technical assistance
document that provides additional information on conducting appropriate
sensitivity-based analyses for this purpose. A more complete
description of this and the other types of precursor demonstrations is
contained in Section III of this preamble.
    The EPA recommends that the state consult with the appropriate EPA
Regional Office as early as possible to discuss appropriate analyses
for the NNSR precursor demonstration. If the appropriate precursor
demonstration is submitted to and approved by the Administrator, the
state would not be required to regulate new major stationary sources
and major modifications of the insignificant precursor under the
state's approved NNSR program in a particular nonattainment area. Such
exemption from the NNSR control requirements would include an exemption
from all of the prerequisite conditions set forth in 40 CFR 51.165 for
PM2.5, including the requirements to implement LAER and to
obtain emissions offsets for the precursor.
iii. Comments and Responses
    Comments: Some commenters supported revising the definition of
``regulated NSR pollutant'' consistent with the NRDC decision and
subpart 4 to establish SO2, NOX, VOC and ammonia
as regulated PM2.5 precursors, unless a state demonstrates
that major stationary sources of a particular precursor do not
contribute significantly to PM2.5 levels that exceed the
standard in the nonattainment area.
    On the other hand, several commenters urged the EPA not to begin
regulating VOC and ammonia as PM2.5 precursors under the
NNSR program at this time. Some of the commenters cited ongoing
technical challenges related to evaluating the contribution of
PM2.5 precursor gases to ambient PM2.5

concentrations, while some commenters stated that the EPA should
provide an up-front rebuttable presumption that a state is not required
to regulate VOC and ammonia as PM2.5 precursors under NNSR.
A commenter stated that requiring NNSR to apply to sources of these
precursors that would have an insignificant impact on the nonattainment
issue is a waste of resources and will unnecessarily lead to burdensome
over-regulation for affected sources.
    Response: We do not agree with the commenters who oppose the EPA's
proposal to require regulation of all four technical and scientific
precursors in PM2.5 nonattainment areas. Specifically, we do
not agree that a delay in regulating VOC and ammonia under a state's
NNSR permitting program is reasonable or permissible. Similarly, the
EPA does not agree that it has the authority to provide a rebuttable
presumption to exempt VOC and ammonia from NNSR permitting
requirements. CAA section 189(e) explicitly requires the regulation of
major sources of PM2.5 precursors unless the state
demonstrates to the EPA's satisfaction that such regulation is
unnecessary. Thus, CAA section 189(e) does not allow the EPA to
unilaterally exempt an identified scientific and technical
PM2.5 precursor from regulation, nor does it permit the EPA
to establish a rebuttable presumption exempting any PM2.5
precursor from regulation. The EPA's use of a rebuttable presumption
exempting certain precursors from regulation in its prior
PM2.5 implementation rules was directly at issue in NRDC v.
EPA, wherein the court made it clear that it would be inappropriate for
the EPA to establish such presumptions pursuant to the requirements of
subpart 4.\215\
---------------------------------------------------------------------------

    \215\ See NRDC v. EPA, 706 F.3d at 437, n.7 & n.10.
---------------------------------------------------------------------------

    In some PM2.5 nonattainment areas, the minimization (and
offsetting) of new precursor emissions from major source growth in the
area could be an important component of a state's attainment plan for
the PM2.5 NAAQS. Where it is not, CAA section 189(e)
provides states with the opportunity to make an area-by-area
demonstration that would enable the state to exempt sources of any
PM2.5 precursor from regulation if it is shown that sources
of the precursor does not contribute significantly to the PM levels
that exceed the standard in a particular nonattainment area.
Accordingly, consistent with CAA section 189(e), this final rule
provides guidance to assist states in preparing a NNSR precursor
demonstration, as described in Section III of this preamble, by which
sources of VOC, ammonia or any other PM2.5 precursor may be
exempted from the NNSR requirements for PM2.5 if the state
shows that increased source emissions of the relevant precursor would
not contribute significantly to PM2.5 concentrations in a
PM2.5 nonattainment area.
    Moreover, as described in Section VIII.B.2 of this preamble, the
EPA is not commencing with the regulation of VOC and ammonia (hence not
requiring NNSR review of any new major stationary sources and major
modifications of such precursors) for those states relying on Appendix
S to issue NNSR permits during the interim SIP development period.\216\
This provides states with an opportunity to evaluate the contribution
of VOC and ammonia emissions from potential major source growth to
ambient PM2.5 concentrations and determine whether an
exemption of new and modified sources of either of these precursors
from the NNSR permitting requirements is justified before such sources
will be subject to regulation.
---------------------------------------------------------------------------

    \216\ States should use Appendix S to issue NNSR permits to new
major stationary sources and major modifications with respect to a
particular nonattainment pollutant if the state's implementation
plan lacks a NNSR program for that pollutant. Where a state's
existing NNSR program for a particular pollutant lacks certain
provisions for which revision in required, the existing program--not
Appendix S--is the applicable permit program for issuing NNSR
permits until the necessary revisions are approved by the EPA.
---------------------------------------------------------------------------

b. Definition of ``major stationary source'' in Moderate and Serious
PM2.5 Nonattainment Areas--Direct PM2.5 Emissions
and PM2.5 Precursors
i. Summary of Proposal
    Subpart 4, as described earlier in this document, contains
provisions for the classifications of PM10 nonattainment
areas as either Moderate or Serious areas. However, the NNSR
regulations for PM2.5 set forth in the 2008 PM2.5
NSR Rule were developed pursuant to subpart 1, which does not provide
for the classification of designated nonattainment areas as Moderate
and Serious areas. Accordingly, in the proposal for this final rule,
the EPA proposed to amend its definition of ``major stationary source''
in the 40 CFR 51.165 NNSR regulations for PM2.5 to address
subpart 4 requirements concerning the regulation of direct
PM2.5 and PM2.5 precursors in both Moderate and
Serious nonattainment areas for PM2.5. First, the EPA
proposed to revise the definition of ``major stationary source'' by
qualifying the term ``regulated NSR pollutant'' with the new phrase
``(as defined in paragraph (a)(1)(xxxvii) of this section).'' The new
phrase explicitly cross-references the definition of ``regulated NSR
pollutant,'' which also defines each of the PM2.5
precursors. Hence, sources of both direct PM2.5 emissions
and emissions of each PM2.5 precursor would clearly be
included in the definition of a ``major stationary source.''
    Second, the EPA proposed to amend the definition of ``major
stationary source'' consistent with section 189(b)(3) of the CAA to
establish a lower major source threshold for new major stationary
sources and major modifications locating in PM2.5
nonattainment areas classified as Serious. CAA section 302(j) generally
defines a ``major stationary source'' as a source that emits or has the
potential to emit 100 tpy or more of any air pollutant. The provision
explicitly states that this definition applies for purposes of the CAA
except as otherwise expressly provided in the statute. Thus, for
sources locating in PM2.5 nonattainment areas classified as
Moderate, where no CAA provision provides otherwise, the applicable
major source threshold for direct PM2.5 emissions and for
each PM2.5 precursor is 100 tpy. Subpart 4, meanwhile,
establishes a major source threshold for PM10 nonattainment
areas classified as Serious at 70 tpy in CAA section 189(b)(3).
Therefore, the EPA proposed to set the major source threshold for
direct PM2.5 emissions and for each PM2.5
precursor at 70 tpy of direct PM2.5 emissions and each
individual precursor. The alternative proposed for consideration was to
promulgate a PM2.5 major source threshold lower than 70 tpy
of direct PM2.5 emissions, recognizing that PM2.5
is a subset of PM10. The EPA sought comment on possible ways
in which a PM2.5 emissions rate different from the statutory
70 tpy rate for PM10 emissions could be established, taking
into account variations in the PM10/PM2.5 ratio
for different source categories and activities. Nevertheless, the
agency indicated that the proposed option (i.e., a major source
threshold of 70 tpy of direct PM2.5 emissions for stationary
sources proposing to construct or modify in PM2.5
nonattainment areas classified as Serious) represented the preferred
approach.
    In its effort to ensure that major sources of PM2.5
precursors locating in Serious areas are regulated in the same manner
as major sources of direct PM2.5 emissions locating in
Serious areas, the EPA proposed major source thresholds for
PM2.5 precursors would be consistent with the threshold
already defined for

direct PM2.5 emissions in PM2.5 nonattainment
areas reclassified as Serious. Consistent with the EPA's preferred
approach for direct PM2.5 emissions, the EPA proposed to
define ``major'' for each PM2.5 precursor as 70 tpy.
However, the EPA also solicited comments on the appropriateness of
setting the precursor major source thresholds at a different rate,
particularly if, as alternatively proposed, the agency defined ``major
stationary source'' for sources of direct PM2.5 emissions in
Serious PM2.5 nonattainment areas at a rate lower than 70
tpy of PM2.5 emissions. For example, if the agency had set
the major source threshold at 60 tpy of direct PM2.5
emissions in Serious PM2.5 nonattainment areas, the agency
would have also considered setting the major source threshold for each
PM2.5 precursor at 60 tpy of that particular precursor.
    Regardless of whether the major source threshold for direct
PM2.5 emissions was set at 70 tpy or some lower rate, the
EPA indicated in the proposal that it believed a reasonable technical
argument could be made that the threshold set for direct
PM2.5 emissions would be too low to be regarded as ``major''
for each precursor when considering the effects that any precursor
sources could have on ambient PM2.5 concentrations. In
support of higher emissions rates for defining ``major'' for
PM2.5 precursors, the EPA cited a previous analysis that it
had undertaken to examine the relationship between emissions of
SO2 and NOX and the formation of secondary
PM2.5 in the ambient air.\217\ However, the agency also
identified potential legal impediments to setting a major source
threshold for precursors at a rate higher than those statutorily
prescribed for direct emissions of a pollutant. Accordingly, the agency
solicited comments on the general appropriateness of setting higher
major source thresholds for one or more PM2.5 precursors in
PM2.5 nonattainment areas, and asked commenters to include
legal and technical considerations that should be made part of the
EPA's future analysis of NNSR requirements with respect to
PM2.5 precursors.
---------------------------------------------------------------------------

    \217\ See 80 FR 15433. The technical assessment, with details on
data and modeling inputs, was fully described in a technical memo
titled ``Details on Technical Assessment to Develop Interpollutant
Trading Ratios for PM2.5 Offsets,'' which was placed in
the docket to the 2008 PM2.5 NSR Rule. See also 73 FR
28321 (May 16, 2008), at page 28339.
---------------------------------------------------------------------------

ii. Final Rule
    In this final rule, the EPA has followed its preferred approach and
has made the changes necessary to ensure that ``major'' is defined for
direct PM2.5 emissions as well as all PM2.5
precursors in Moderate and Serious PM2.5 nonattainment
areas. For Moderate areas, the major source threshold of 100 tpy
applies individually to direct PM2.5 emissions and to each
PM2.5 precursor; in Serious areas, the major source
thresholds for direct PM2.5 emissions and emissions of each
PM2.5 precursor are individually defined as 70 tpy. As
explained in Section VIII.B.1.d of this preamble, the determination of
whether sources of direct PM2.5 emissions or each
PM2.5 precursor are ``major'' is to be made separately for
each pollutant. That is, emissions rates for individual precursors
should not be added together to determine a source's major source
status with regard to PM2.5. See 40 CFR 51.165(a)(2)(i).
iii. Comments and Responses
    Comment: Most commenters generally supported the preferred approach
of setting a major source threshold at 70 tpy of direct
PM2.5 emissions in Serious areas, agreeing with the EPA that
establishing a PM2.5 equivalency to PM10
emissions would be problematic. Some commenters specifically opposed
any effort to set a threshold for PM2.5 that is lower than
the threshold for PM10. A commenter stated that, if
PM2.5 is legally subject to subpart 4 because it is a subset
of PM10, and Congress meant to subject all sources of
PM10 emissions to subpart 4, then Congress meant to have the
major source threshold for PM10 apply to PM2.5 as
well. No commenter advocated that the EPA set a major source threshold
lower than 70 tpy for direct PM2.5 emissions.
    Response: The EPA agrees with the commenters that it is reasonable
to set the major source threshold at 70 tpy of direct PM2.5
emissions for sources locating in PM2.5 nonattainment areas
classified as Serious. While CAA section 189(b)(3) does not explicitly
define a ``major source'' and ``major stationary source'' as 70 tpy of
PM2.5 for PM2.5 nonattainment areas reclassified
as Serious (because it refers to PM10), the most
straightforward and consistent application of the statutory provision
is to establish the same numerical threshold for sources of
PM2.5 in Serious PM2.5 nonattainment areas as the
threshold for sources of PM10 emissions in Serious
PM10 nonattainment areas. Sources locating in Moderate
nonattainment areas are already subject to the same numerical major
source threshold (100 tpy) under CAA section 302(j) for direct
emissions of both PM10 and PM2.5, so the EPA
believes that it is also reasonable to establish the threshold for
PM2.5 in Serious areas at the same numerical rate as the
threshold that applies to PM10 in Serious areas.
    We also agree that it would be difficult to establish a lower
uniform major source threshold for PM2.5 that would
represent a rate that is equivalent to 70 tpy of PM10
emissions at all sources subject to NNSR permitting requirements. With
regard to the commenter who stated that ``Congress meant to have the
major source threshold for PM10 apply to PM2.5 as
well,'' it is not clear whether the commenter advocates that proposed
sources of PM2.5 be subjected to NNSR permitting using a
major source threshold of 70 tpy of PM10 emissions or a
major source threshold of 70 tpy of PM2.5 emissions for
sources of PM2.5 locating in PM2.5 nonattainment
areas. The former is not the EPA's interpretation of the CAA. While
PM2.5 is a subset of PM10, to assume that a
source emitting major amounts of PM10 will also emit a
substantial amount of PM2.5 is not always reasonable. The
relative amounts of PM10 and PM2.5 emitted by
various source categories is known to vary significantly and we do not
believe that it would be reasonable to subject sources to major source
review for PM2.5 on the basis of the level of
PM10 emissions as this could mean that sources are subject
to NNSR based on different levels of PM2.5 emissions on an
area-by-area basis. We do not believe that Congress intended such a
lack of uniformity in the application of the major source threshold to
sources of direct PM2.5. Moreover, even if it were
permissible to interpret CAA section 189(b)(3) in this manner, we have
determined that the most reasonable and straightforward approach is to
establish a separate major source threshold for direct emissions of
PM2.5 at 70 tpy for sources locating in PM2.5
nonattainment areas classified as Serious.
    Comment: With regard to the definition of ``major stationary
source'' for PM2.5 precursors in Moderate and Serious areas,
several commenters supported using the same major source threshold
value for direct PM2.5 emissions and PM2.5
precursors. One of these commenters expressly opposed any alternative
approach that would set a different threshold for PM2.5
precursors than for direct PM2.5 emissions because the
commenter asserted that it would be impossible to set a uniform
national ratio reflecting the effect of the various precursors on
ambient PM2.5 concentrations relative to direct
PM2.5 emissions.
    On the other hand, some commenters wanted the EPA to include a
provision

in the NNSR regulations allowing states to make a case-by-case
demonstration to use higher major source thresholds for
PM2.5 precursors for permit reviews. These commenters
expressed concern that the 100 tpy major source threshold for Moderate
areas, and the 70 tpy threshold for Serious, are both too low for the
PM2.5 precursors and do not realistically reflect the effect
that each precursor has on ambient PM2.5 concentrations.
These commenters suggested the EPA should conduct further analyses to
determine what higher quantity of emissions of each regulated precursor
would be equivalent to 100 tpy (for Moderate areas) and 70 tpy (for
Serious areas) of direct PM2.5 emissions in terms of
contribution to PM2.5 concentrations in ambient air. These
commenters recommended that the EPA use the information gained from the
recommended analyses to determine appropriate thresholds and make its
proposed thresholds available for public comment.
    Response: In setting the major source threshold for each
PM2.5 precursor at 100 tpy for Moderate areas, the EPA is
following the precedent established in the 2008 PM2.5 NSR
Rule in which the agency set the same 100 tpy major source threshold
for direct PM2.5 emissions and each of the regulated
precursors (at that time SO2 and NOX).\218\
Setting the same 100 tpy major source thresholds for sources of
PM2.5 emissions and regulated PM2.5 precursor
emissions is also consistent with the way in which we have historically
interpreted the requirements of CAA section 189(e) as they applied to
emissions of PM10 and PM10 precursors.\219\
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    \218\ Ibid.
    \219\ See 57 FR 13498 (April 16, 1992), at page 13538.
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    Moreover, section 302(j) of the CAA contains a definition of
``major emitting facility'' and ``major stationary source'' that
applies to, among other things, programs implemented under subpart 1
such as the general NNSR program requirements in CAA section 173.\220\
This definition also applies to programs implemented under subpart 4 to
the extent that they regulate PM2.5 nonattainment areas
classified as Moderate, as subpart 4 does not establish a different
definition of major sources for such areas. That definition defines a
source as ``major'' whenever a facility or source ``emits, or has the
potential to emit, one hundred tons per year or more of any air
pollutant.'' \221\ This provision does not clearly provide the EPA with
the authority to set a major source threshold higher than 100 tpy for a
pollutant merely because it is a precursor for another pollutant.
Rather, CAA section 302(g) clearly defines the term ``air pollutant''
to ``include any precursors to the formation of any air pollutant.''
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    \220\ Ibid. (emphasis added).
    \221\ 42 U.S.C. 7602(j).
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    With regard to the setting of the major source thresholds for
PM10 precursors in Serious areas, a House of Representatives
Report accompanying the 1990 amendments to the CAA described the
effects of adding CAA section 189(b)(3), defining ``major'' sources
locating in PM nonattainment areas classified as Serious as those
sources that emit or have the potential to emit 70 tpy of
PM10. The report specifically notes that ``new or modified
sources emitting 70 tons or more per year of VOC [a PM2.5
precursor] will be subject to new source review requirements.'' \222\
Thus, Congress contemplated that the same major source threshold would
apply to sources of direct PM10 emissions and
PM10 precursors in Serious PM10 nonattainment
areas. The same approach logically applies when applying the provision
to sources locating in areas designated as Serious PM2.5
nonattainment areas.
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    \222\ H.R. Rep. 101-490.
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    Since the EPA may not have the legal authority to establish major
source thresholds for PM2.5 precursors at levels higher than
the statutory threshold applied to sources of direct PM2.5
emissions, it would be inappropriate to allow states discretion for
setting major source thresholds for PM2.5 precursors that
exceed the statutory thresholds. Moreover, while we acknowledge that
PM2.5 precursors will not likely form ambient
PM2.5 in the nonattainment area on a ton-per-ton basis,
there is not currently sufficient technical basis that would enable the
agency to propose uniform higher major source thresholds for any of the
four PM2.5 precursors. As stated in the proposal, the EPA
intends to continue its analysis of the relationship between each
precursor and ambient PM2.5 concentrations.
    Comment: Some commenters questioned the EPA's interpretation of the
2006 court decision in South Coast Air Quality Mgmt. Dist. v. EPA \223\
as precluding higher major source thresholds because the court
determined that NSR provisions, including major source thresholds, were
control requirements subject to anti-backsliding provisions of the
statute. The commenter argued that the South Coast decision did not
address setting a major source threshold for a precursor pollutant that
is as stringent as, or more stringent than, the major source threshold
for the pollutant when the pollutant is directly emitted. The commenter
stated the statutory provision on which the court in South Coast relied
[CAA section 172(e)] is applicable on its face only when the EPA
relaxes the NAAQS, which the commenter claimed is not relevant to the
current situation here, where the EPA has promulgated progressively
more stringent NAAQS for PM.
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    \223\ South Coast Air Quality Mgmt. Dist. v. EPA, 472 F.3d 882,
900-902 (D.C. Cir. 2006) (South Coast decision).
---------------------------------------------------------------------------

    Response: CAA section 189(e) requires the control requirements that
are applicable to major stationary sources of PM2.5 to also
apply to major stationary sources of PM2.5 precursors. The
court in South Coast held that the term ``controls'' under section
172(e) of the CAA includes NSR requirements, and in particular includes
major source thresholds specified by the statute.\224\ The commenter
did not explain why the term ``control'' in CAA section 189(e) of the
statute should be interpreted differently than the term ``control'' in
other parts of the statute. Section 172(e) of the CAA is a provision in
subpart 1 of part D of the statute concerning anti-backsliding
requirements in designated nonattainment areas. It is reasonable for
the EPA to conclude that the term ``control'' in one part of the
statute pertaining to nonattainment area requirements should be
interpreted consistent with the use of that term in other provisions of
part D pertaining to nonattainment area requirements, particularly
where both provisions apply to designated PM2.5
nonattainment areas. Thus, consistent with the holding of South Coast
regarding the definition of ``controls,'' the EPA interprets the use of
the term ``control requirements'' in CAA section 189(e) to require the
same major source threshold be applied to PM2.5 precursors
as applies to direct PM2.5 emissions.
---------------------------------------------------------------------------

    \224\ See South Coast decision (holding that ``controls'' in CAA
section 172(e) anti-backsliding provision include NSR requirements
such as LAER, offset ratios, and major source thresholds).
---------------------------------------------------------------------------

    The commenter also did not explain, and it is not clear, how a
relaxation versus a strengthening of the NAAQS would bear on whether
the EPA has authority to set different control requirements (e.g.,
major source thresholds) for sources of direct emissions of a pollutant
and sources of precursors of that pollutant. The EPA notes that
Congress, in adding additional particulate matter requirements in
subpart 4 of the CAA,

decided that more stringent requirements were required to address air
quality in particulate matter nonattainment areas. Hence, it would be
inconsistent with that intention for Congress to allow higher major
source thresholds to apply to sources of precursors than apply to
direct PM2.5 emissions.
    The EPA therefore believes that at this time the most reasonable
approach for defining the major source threshold for PM2.5
precursors in both Moderate and Serious areas is to use the same
threshold that is being defined for direct PM2.5 emissions.
As explained earlier, the EPA currently has studies underway to better
understand the effects of emissions of each precursor on the secondary
formation of ambient PM2.5 concentrations. However, even if
such studies support the commenters' recommendation for higher
precursor thresholds, the EPA must consider the potential legal
restrictions on setting thresholds for precursors above the statutory
requirements for direct emissions of an air pollutant.
c. Significant Emissions Rates (SERs) for PM2.5 Precursors
i. Summary of Proposal
    As noted earlier, stationary sources locating in nonattainment
areas are subject to the NNSR permitting requirements to the extent
construction at the source qualifies as a major modification with
respect to a pollutant for which the area is designated nonattainment.
A major modification of a stationary source is defined in the NNSR
regulations at 40 CFR 51.165(a)(1)(v)(A) as ``any physical change in or
change in the method of operation of a major stationary source'' that
would result in (1) a significant emissions increase of a regulated NSR
pollutant, and (2) a significant net emissions increase of that
pollutant. The term ``significant'' is separately defined at 40 CFR
51.165(a)(1)(x)(A) to mean a rate of emissions specified for each
pollutant or precursor for that pollutant. This is known as a
significant emissions rate (SER). In the 2008 PM2.5 NSR
Rule, the EPA defined ``significant'' for SO2 and
NOX as PM2.5 precursors with an emissions rate of
40 tpy for each precursor.\225\ Also, in the preamble to the 2008
PM2.5 NSR Rule, the EPA indicated that it would consider 40
tpy of VOC emissions to be ``significant'' in any state regulating VOC
as a PM2.5 precursor; however, that significant emissions
rate was not codified in any of the NSR regulations because the
regulations governing both NNSR and PSD permitting programs provided
that VOC was generally presumed not to be a precursor to
PM2.5. Instead, the agency explained that any state making a
demonstration that VOC should be treated as a PM2.5
precursor in a particular nonattainment area ``would be required to
adopt the 40 tpy SER unless it demonstrated that a more stringent SER
(lower rate) is more appropriate.''\226\
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    \225\ See the Federal Register published on May 16, 2008 (73 FR
28321, 28333 and 28334); and existing 40 CFR 51.165(a)(1)(x)(A).
    \226\ See the Federal Register published on May 16, 2008 (73 FR
28321 and 28333).
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    The EPA did not include any changes to the existing SERs for
SO2 and NOX as PM2.5 precursors in the
proposal. Nor did we propose a SER for ammonia, citing a lack of
adequate technical support. However, the EPA proposed to codify a SER
of 40 tpy for VOC in the NNSR permitting regulations. See 55 FR
15434.\227\ The EPA further stated that, as a result, only the ammonia
SER would remain to be defined by each state that needs to control
major stationary sources of ammonia as part of its NNSR program for
PM2.5. While not proposing to revise the existing 40 tpy SER
values for SO2 and NOX, the EPA indicated it
believed that, when more data are available, such data might provide a
reasonable basis for considering subsequent changes to the SER for each
PM2.5 precursor for purposes of implementing the
PM2.5 NAAQS. Moreover, the EPA indicated that a separate
rulemaking might be used to propose a new SER for each PM2.5
precursor. See 80 FR 15434.
---------------------------------------------------------------------------

    \227\ The EPA notes that the 2015 NPRM included some potentially
conflicting statements concerning the development of a SER for VOC.
First, the preamble indicated that the EPA intended to consider a
separate rulemaking to consider proposing new SERs for
SO2 and NOX, while also proposing individual
significant emissions rates for VOC and ammonia. Later in the same
preamble, the EPA indicated that it was proposing to add VOC as a
precursor with a 40 tpy significant emissions rate, and included
regulatory text to show that aspect of the proposal, i.e., proposed
40 CFR 51.165(a)(1)(x)(A).
---------------------------------------------------------------------------

ii. Final Rule
    The EPA is finalizing its proposed approach with some changes to
the final regulatory language. The final rule amends the definition of
``significant'' in the NNSR regulations at 40 CFR 51.165(a)(1)(x)(A) to
add a SER for VOC. Thus, the revised definition contains individual
SERs for direct PM2.5 emissions (10 tpy), SO2
emissions (40 tpy), NOX emissions (40 tpy), and VOC
emissions (40 tpy). The revised definition does not contain a SER for
ammonia emissions. Instead, a new subparagraph has been added to the
definition of ``significant'' to require that an implementation plan
defines the term for ammonia in cases where sources of ammonia are not
otherwise exempted from NNSR control requirements. See 40 CFR
51.165(a)(1)(x)(F). Such definition of ``significant'' for ammonia
would need to be established by the state for a particular
nonattainment area as part of its SIP submission for NNSR. The EPA's
rationale for not establishing an ammonia SER in this action is
provided in greater detail in the following section.
iii. Comments and Responses
    Comment: Several commenters generally recommended that the EPA
establish higher SERs for the PM2.5 precursors. These
commenters expressed the need for values that more accurately
represented each precursor's relative effect on ambient
PM2.5 concentrations. One of these commenters stated that in
the absence of such higher SERs in the NNSR regulations, the EPA should
allow states to demonstrate the appropriateness of a higher SER for a
particular precursor on either a statewide or area-by-area basis in a
SIP submission, or through the NNSR program on a case-by-case basis.
    Another of the commenters supporting higher significance thresholds
for each precursor stated that the CAA's definitions of ``major
source'' and ``major emitting facility'' trigger the statutory control
requirements and its permit requirements for affected sources, but they
do not define how much of a pollutant is regulated after the control or
permit requirement is triggered by the CAA. The commenter stated that
the EPA would appear to have ample authority to require that precursors
be regulated based on different thresholds once a major source triggers
a particular control or permit requirement, provided there is adequate
technical basis for doing so.
    Response: The EPA did not propose to reconsider or revise the SERs
for SO2 and NOX; therefore, revisions to these
rates are outside the scope of this action. Even if the EPA were to
consider such a revision, it would provide little relief to new or
modified sources subject to NSR. Because SO2 and
NO2 are pollutants for which the EPA has established NAAQS
and because NOX and VOC are precursors for ozone,
modifications with emissions increases above the current SERs for
SO2, NOX or VOC would still be subject to some
form of new source review (PSD if the area is attainment for the NAAQS
pollutant or nonattainment NSR if the area is nonattainment) even if
the SERs for these pollutants as PM2.5 precursors were
revised to a higher value.

Moreover, we do not believe that the statute would permit the EPA or
states to adopt a definition of ``significant'' for purposes of
identifying modifications subject to NSR permitting with rates greater
than the statutory and regulatory definitions of a major source in a
nonattainment area, as defined in CAA section 302(j) for sources
locating in PM2.5 nonattainment areas classified as Moderate
(100 tpy) and as defined in CAA section 189(b)(3) for sources locating
in PM2.5 nonattainment areas classified as Serious (70 tpy).
Consequently, we do not believe that there would be substantial cost
savings to many sources if we were to revise the SERs for these
pollutants specifically as PM2.5 precursors.
    Comment: Some commenters directed specific attention to the
definition of a SER for ammonia. These commenters urged the EPA to set
a significance threshold for ammonia as soon as possible. These
commenters stated that, without a SER, any significant emissions
increase greater than zero tons per year would result in a major source
review for NNSR.
    Some commenters stated that, while the EPA indicates that a SER for
ammonia may be developed in a subsequent rulemaking, if that rulemaking
is not timely, the state would need to develop a SER for ammonia to
reduce the burden on permit applicants and avoid permit issuance delays
related to major source applicability determinations and permit
development for ammonia and PM2.5. Two of the commenters
noted that ammonia is used in many industry and source types to control
NOX emissions through the implementation of selective
catalytic reduction (SCR) and selective non-catalytic reduction (SNCR)
control devices. These commenters stated that, without a SER for
ammonia, it's very possible that many NNSR reviews will be initiated
simply because of any ammonia increase at a major source. To address
this problem, some commenters stated that, until the EPA completes its
analysis for ammonia, states need the ability to conduct case-by-case
reviews for NNSR permits by requiring applicants to submit a technical
demonstration showing that emissions of a particular precursor do not
significantly contribute to PM2.5 levels that exceed the
standard in an area, thus exempting the precursor from being controlled
by that source.
    Some commenters recommended that the EPA propose a SER for ammonia
before finalizing the March 23, 2015, proposal and suggested the EPA
should also provide definitive guidance for state and local agencies on
how to conduct permitting of major sources of ammonia until a SER is
established. Other commenters stated that, at the time the EPA proposes
new significant emission rates for precursors, the EPA should also
establish the significant emission rate for ammonia. Yet another
commenter stated that any precursor analyses conducted by the EPA
should be done in close coordination with designated nonattainment
areas to reduce duplication of efforts and conflicting outcomes that
could in turn lead to more costly impacts on sources and on agencies'
limited resources. Finally, some commenters stated that the EPA should
at least provide guidance for states to develop a SER for ammonia as a
PM2.5 precursor.
    Response: The EPA did not propose a SER for ammonia and, therefore,
this rule does not finalize a SER for ammonia. The EPA's initial plan,
as explained in the proposal, was to establish a SER for ammonia in a
separate rulemaking, which was also intended to establish significant
impact levels (SILs) for Ozone and PM2.5 in order to
streamline the air quality impact analysis under the PSD permitting
program. However, based on the imminent need for the SILs (especially
for ozone) for PSD permitting, the agency has decided to issue guidance
in lieu of a rulemaking for the PSD-based SILs. After due
consideration, the EPA has also concluded that a separate rulemaking
solely for the purpose of developing a SER for ammonia is not
warranted. We anticipate that very few states will actually need to
control source modifications of ammonia under their NNSR programs for
PM2.5 since (1) stationary sources of ammonia generally are
not one of the primary causes of ambient PM2.5
concentrations in most PM2.5 nonattainment areas, and (2)
according to information in the EPA's NEI database, most existing
PM2.5 nonattainment areas do not have an existing major
stationary source of ammonia to which the ammonia SER would be applied
to determine whether a proposed modification of such major source would
be ``major'' for ammonia.
    Unlike the EPA's PSD regulations, the definition of ``significant''
in the NNSR regulations at 40 CFR 51.165 does not include a provision
stipulating that, for any pollutant that does not have a listed
emissions rate, ``any increase'' must be considered significant.\228\
Therefore, contrary to the concerns of some commenters, the absence of
an ammonia SER in the EPA's NNSR regulations at 40 CFR 51.165 does not
result in a default ``any increase'' interpretation of ``significant''
that must be contained in state NNSR programs. Accordingly, for the
above reasons and due to the time, resources and process investment
associated with a national rulemaking, the EPA believes that a national
rulemaking to develop a SER for ammonia is neither warranted nor
effective. As explained above, the EPA is finalizing a provision that
requires states that must regulate modified major stationary sources of
ammonia to develop and submit a definition of ``significant,'' such as
an appropriate SER, for ammonia to be included, subject to the EPA's
approval in the state's SIP. See 40 CFR 51.165(a)(1)(x)(F). The EPA
recommends that states consult with the appropriate EPA Regional Office
to develop an ammonia SER as a means of defining ``significant'' for a
particular nonattainment area. As a general rule, the EPA believes that
the ammonia SER in a Moderate nonattainment area should be an emissions
rate no greater than 100 tpy of ammonia. Any SER that exceeds 100 tpy
could not be approved by the EPA because any higher emissions rate
would exceed the major source threshold established in the CAA.\229\ In
the event that a nonattainment area is classified Serious for
PM2.5, the maximum acceptable ammonia SER would be a rate no
greater than 70 tpy in accordance with the major source thresholds
being finalized in this rule for major stationary sources of direct
PM2.5 emissions and PM2.5 precursors locating in
Serious PM2.5 nonattainment areas. States that regulate
ammonia as a PM2.5 precursor should also include a technical
justification for the ammonia SER for a nonattainment area that the
state includes as a part of its NNSR SIP rules submission for EPA
approval.
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    \228\ Compare the definitions of ``significant'' under the PSD
regulations at 40 CFR 51.166(b)(23) and 52.21(b)(23), especially
subparagraph (ii), with the NNSR definition at 40 CFR 51.165(a)(x).
    \229\ The NNSR definition of ``major stationary source''
includes a provision at 40 CFR 51.165(a)(iv)(A)(3) that requires any
physical change at an existing source that would not otherwise
qualify as a major stationary source if the change would constitute
a major stationary source by itself.
---------------------------------------------------------------------------

d. NNSR Applicability Determinations
i. Summary of Proposal
    In setting SERs and major source thresholds for emissions of direct
PM2.5 and PM2.5 precursors, the EPA explained in
the preamble to the proposal that it intended for direct
PM2.5 emissions and each individual PM2.5
precursor to be treated separately for determining the applicability of
the

NNSR requirements to a proposed new source or modification. The EPA
stated that such individual treatment of direct emissions and
precursors was consistent with its policy as explained in previous
rulemakings. In particular, the preamble to the 2008 PM2.5
NSR Rule explained that this applicability interpretation applied to
both PSD and NNSR. However, at that time, we did not codify this
interpretation in any of the NSR regulations. See 73 FR 28231, May 16,
2008, at page 28331. In the proposal, the EPA proposed language in the
NNSR regulations at 40 CFR 51.165(a)(2)(i) to explicitly codify the
policy.
ii. Final Action
    The EPA is revising the NNSR regulations at 40 CFR 51.165(a)(2)(i)
to codify the EPA's policy that direct emissions of a pollutant and
emissions of any applicable precursor are to be considered
independently for purposes of determining the applicability of the NNSR
requirements for PM2.5 sources. For example, in order for a
source to be subject to the NNSR requirements for PM2.5 with
respect to NOX as a PM2.5 precursor, the source
must be either (1) a new stationary source that emits or has the
potential to emit major amounts of NOX (new major source of
NOX); or (2) an existing major source of NOX that
proposes to increase its emissions of NOX by a significant
amount and also results in a significant net emissions increase.
iii. Comments and Responses
    Comment: A commenter requested that the EPA clarify in its NSR
rules how to evaluate major source applicability for NNSR and PSD with
respect to PM2.5 precursors. The commenter agreed that major
source applicability determinations should be based on individual
precursor pollutant emissions, and that different pollutants, including
individual precursors, should not be summed to determine applicability
for NNSR major stationary source or major modification. The commenter
also raised various questions pertaining to how the precursors would
trigger major source applicability for other pollutants.
    Response: This final rule contains the following statement within
the NNSR regulations at 40 CFR 51.165(a)(2)(i), ``Different pollutants,
including individual precursors, are not summed to determine
applicability of a major stationary source or major modification.'' The
commenter's specific precursor-related applicability questions and the
EPA's responses are included in the Response to Comment document
contained in the Docket for this rulemaking.
e. NNSR Plan Due Dates
i. Summary of Proposal
    In the proposal, the EPA explained that CAA section 189(a)(2)(B)
requires states to submit to the EPA an attainment plan satisfying the
applicable requirements within 18 months of an area being designated
nonattainment pursuant to a new or revised PM2.5 NAAQS. See
80 FR 15437. Section 189(a)(1)(A) of the CAA specifically requires that
such plans include the NNSR permitting requirements under CAA section
173. Thus, the EPA indicated that states would be required to submit
the applicable NNSR program requirements for PM2.5 within 18
months from the effective date of area designations for the 2012
PM2.5 NAAQS. See 80 FR 15437.
    The EPA also noted that the CAA does not specify a deadline for the
states' submittal of NNSR program revisions in the event that a
Moderate PM2.5 nonattainment area is subsequently
reclassified as Serious like the CAA establishes a deadline for other
plan provisions. Accordingly, the EPA used its gap-filling authority
under CAA section 301(a) to propose a similar 18-month deadline, from
the effective date of a final reclassification of the area as Serious,
for states to submit a plan prescribing the more stringent NNSR
requirements required by the statute for Serious areas. However, in
light of the fact that such revisions would generally be
straightforward to make, and to assure that new major sources and major
modifications in the area would be subject to the more stringent NNSR
requirements contained in subpart 4 for Serious areas, the EPA sought
comments on an alternative 12-month timeframe for submittal of the NNSR
plan revisions for Serious areas.
ii. Final Rule
    The EPA is finalizing an 18-month deadline for states to submit
plan revisions for NNSR requirements for PM2.5 after an area
is initially designated to nonattainment (Moderate area) or
reclassified to Serious. See 40 CFR 51.1003(a) and (b), respectively.
As explained elsewhere in this Section VIII of the preamble, plan
revisions applicable to areas reclassified as Serious must address the
more stringent major source thresholds for direct PM2.5
emissions and each applicable PM2.5 precursor for Serious
areas. With regard to the provisions for precursors, the EPA emphasizes
that if the state seeks to continue to exempt a precursor from NNSR
control requirements, the state will need to reevaluate any previous
finding that resulted in the exclusion of a precursor from the NNSR
control requirements on the grounds that the precursor did not
significantly contribute to PM2.5 levels that exceed the
NAAQS. The requirement at 40 CFR 51.1006(b) calling for a new NNSR
precursor demonstration means that, even if the existing NNSR program
already includes the necessary provisions for a Serious area
classification under a prior approval, a plan revision pertaining to
NNSR may still be required to add requirements for a precursor that had
previously been exempted, if a new NNSR precursor demonstration does
not support continued exemption of that precursor.
    The requirements for submitting plan revisions at 40 CFR 51.1003
also provide for situations where an area classified as Serious is
subject to CAA section 189(d) for failing to attain the
PM2.5 NAAQS by the applicable Serious area attainment date.
See 40 CFR 51.1003(c). The list at Sec.  51.1003(c), which contains
attainment plan requirements that must be submitted as plan revisions,
does not include the NNSR plan requirements contained at Sec.  51.165.
This omission results from the fact that Serious area requirements
should have already been included in the NNSR program when the area was
originally reclassified as Serious. Hence, there is no explicit
requirement to revise the NNSR plan requirements in such cases.
However, in light of the fact that states have the opportunity to
submit a new NNSR precursor demonstration for each required plan
revision (40 CFR 51.1006(b)), there may indeed be a need to revise the
NNSR requirements in the event that a previous exemption can no longer
be supported by the new NNSR precursor demonstration. Therefore, to the
extent that a state's plan previously exempted sources of a precursor
from NNSR regulation, a plan revision for a Serious area that fails to
attain the PM2.5 NAAQS by the applicable Serious area
attainment date will need to include a re-evaluated NNSR precursor
demonstration if the state wishes to continue to exempt sources of that
precursor. Such a plan revision is required to be submitted no later
than 12 months from the applicable Serious area attainment date that
was previously missed, in accordance with 40 CFR 51.1003(c)(2). The
NNSR regulations have also been amended at 40 CFR 51.165(a)(13) to
address the need to re-evaluate such a demonstration to

exempt a particular precursor from the NNSR requirements for
PM2.5.
iii. Comments and Responses
    Comment: Some commenters supported allowing states at least 18
months to make the required SIP submission for NNSR. A commenter who
supported the longer submission period stated that, although it is easy
to write the rule language to make this change, it is likely to be
quite difficult to perform the environmental and socio-economic
analyses required by state law if the lowering of the threshold for a
Serious area does indeed have a significant effect on the building of
new or the repowering of existing power plants.
    Response: Although the types of revisions needed to an existing
NNSR program to address the new subpart 4 requirements for
PM2.5 are relatively straightforward, the EPA acknowledges
that such changes nevertheless often involve related analyses as well
as state legislative review and approval. In addition, some states will
be submitting NNSR regulations for PM2.5 for the first time
and, as such, could need more than 12 months to obtain the necessary
legislative review and approval. Accordingly, the EPA believes that the
most reasonable approach for establishing the plan due date for revised
plans for PM2.5 is to establish an 18-month deadline for
submission of plans both upon initial designation to nonattainment for
a particular PM2.5 standard and upon any subsequent
reclassification to Serious.
2. Offset Ruling at 40 CFR Part 51 Appendix S
    In this final rule, as explained later, the EPA is making the
following revisions for PM2.5 in the Emission Offset
Interpretive Ruling (40 CFR part 51, Appendix S): (a) Amending the
definition of ``regulated NSR pollutant'' with regard to
PM2.5 precursors; (b) amending the definition of ``major
stationary source'' with regard to major sources of direct
PM2.5 emissions and PM2.5 precursors in Serious
areas; and (c) amending the definition of ``significant'' with regard
to identifying major modifications of sources of PM2.5
precursors.
a. Appendix S Definition of ``Regulated NSR Pollutant''--
PM2.5 Precursors
i. Summary of Proposal
    The definition of ``regulated NSR pollutant'' contained in Appendix
S at section II.A.31(ii)(b)(2) has, to date, only required regulation
of SO2 as a PM2.5 precursor for states relying on
Appendix S to issue permits to sources locating in PM2.5
nonattainment areas. The EPA proposed to revise the definition in
Appendix S of ``regulated NSR pollutant'' to also require regulation of
NOX as a PM2.5 precursor.\230\ The EPA noted that
this proposed approach would ensure that states using the permitting
requirements contained in Appendix S to issue permits to major new and
modified sources in PM2.5 nonattainment areas will regulate
the same precursors that have been subject to regulation in states that
have already adopted NNSR requirements for PM2.5 based on
the 2008 PM2.5 NSR Rule.
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    \230\ The EPA notes that in the preamble to the proposal, it was
stated that the EPA proposed to add NOX as a
PM2.5 precursor at section II.A.31.(iii)(b) of Appendix
S. This was an incorrect reference, which should have read ``section
II.A.31.(ii)(b).'' This final rule cites the correct section for the
affected portion of the definition of ``regulated NSR pollutant,''
where NOX is being added as a PM2.5 precursor.
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    The EPA also proposed an alternative approach based on similar
logic that would initially require only SO2 and
NOX to be regulated as PM2.5 precursors, while
later phasing in VOC and ammonia after states have prepared and the EPA
has had sufficient time to evaluate any pending precursor
demonstrations. See 80 FR 15436-37. Finally, the EPA also sought
comments on an alternative to require the immediate regulation of all
four scientific PM2.5 precursors (SO2,
NOX, VOC and ammonia) in Appendix S.
ii. Final Rule
    The EPA is amending Appendix S in this final rule to provide for
the immediate regulation of SO2 and NOX as
regulated NSR pollutants (specifically as PM2.5 precursors)
and for the subsequent conditional phasing in of VOC and ammonia as
regulated NSR pollutants (PM2.5 precursors) on the date 24
months from the effective date of the nonattainment designation in each
area. The EPA was persuaded by the comments received expressing
concerns that states may delay NNSR SIP development to instead rely on
a less-inclusive Appendix S for NNSR permitting if only SO2
and NOX were regulated.
    The alternative proposal featuring the phase-in approach balances
the opportunity for states to demonstrate in the short-term that
certain precursors need not be regulated with the need to ensure that
the appropriate precursors are controlled in a manner consistent with
the CAA. NNSR is unique among the nonattainment area requirements in
that sources seeking a construction permit must comply with NNSR
requirements for a particular pollutant as soon as an area is
designated nonattainment for that pollutant and not some months or
years later, when the EPA formally approves a state plan and the
sources comply with the remaining plan provisions. With respect to
precursors in particular, this means that new and modified major
sources of direct PM2.5 or a regulated PM2.5
precursor would be subject to NNSR regulation upon the effective date
of the area designation to nonattainment. If the EPA required the
immediate regulation of all four scientific PM2.5 precursors
in Appendix S, states issuing permits pursuant to those provisions
during the interim SIP development period would need to require
regulation of certain precursors that the state may later be able to
demonstrate through a SIP submission do not significantly contribute to
PM2.5 levels that exceed the standard in a particular area.
As state plans making such a NNSR precursor demonstration are not due
until 18 months after the effective date of the area designation, and
as the statute allows the EPA up to 18 months to act on such
submissions, sources seeking permits to locate in such areas during
this interim period might for several years be subject to more
stringent controls than necessary to address PM2.5
nonattainment in that area.
    The EPA is also cognizant, however, that some states have relied on
Appendix S to conduct NNSR permitting well beyond the statutory SIP
development period. In such cases, it would be inequitable if states
could indefinitely rely on Appendix S that requires little to no
regulation of some of the scientific PM2.5 precursors when
other states are fulfilling their statutory duty to submit a SIP
revision addressing all PM2.5 precursors. In particular,
states that have submitted NNSR SIPs addressing PM2.5
requirements for the 1997 and 2006 standards have to date regulated
SO2 and NOX as PM2.5 precursors. These
SIP provisions will continue to apply with respect to any areas
designated nonattainment as to the 2012 standard in those states until
the states submit SIP revisions to address the 2012 NAAQS, including
provisions necessary to comply with the precursor requirements in CAA
section 189(e). States either continuing to rely on Appendix S by
virtue of a nonattainment area designation under a prior
PM2.5 standard or states newly relying on Appendix S by
virtue of a nonattainment area designation under the 2012 standard have
to date only been required to regulate SO2 as a

regulated NSR pollutant (specifically as a PM2.5 precursor).
    In order to balance these competing interests and concerns, the EPA
has determined in this final rule to revise Appendix S in order to
require that any state relying on Appendix S initially regulate both
SO2 and NOX as regulated NSR pollutants
(PM2.5 precursors) for NNSR permits, thereby aligning the
requirements of Appendix S with the prevailing requirements of SIP-
approved NNSR permitting provisions for PM2.5 in other
states. See Appendix S, section II.A.31.(ii)(b)(2). Further, the final
rule provides that VOC and ammonia will be phased in as regulated NSR
pollutants (PM2.5 precursors) according to a prescribed
schedule based on existing and future nonattainment area designations
for PM2.5, unless the EPA has determined, prior to the
scheduled phase-in, that the state submitted a complete proposed NNSR
program for PM2.5 that includes a NNSR precursor
demonstration. The EPA believes it is reasonable not to require
regulation of sources of VOC and ammonia in Appendix S during the
interim SIP development period because we expect that, in many cases,
states will submit SIPs that include as part of their proposed NNSR
rules for PM2.5 a NNSR precursor demonstration indicating
that they do not need to regulate new major stationary sources and
major modifications of ammonia (and in some cases of VOC) under their
NNSR programs in order to provide for attainment of the
PM2.5 NAAQS.
    Under the phase-in schedules being finalized in Appendix S, permits
issued by states under the requirements in Appendix S will not be
required to address VOC and ammonia as regulated NSR pollutants
(PM2.5 precursors) until the state has had an opportunity to
show that, as part of a proposed NNSR program for PM2.5,
sources of a particular precursor does not significantly contribute to
PM2.5 concentrations that exceed the standard in a given
nonattainment area. If a state submits such a NNSR precursor
demonstration as to either VOC or ammonia as part of a complete SIP
submission that includes the state's proposed NNSR program for
PM2.5, the state would not be required to regulate the
applicable precursor pursuant to the provisions of Appendix S, unless
the EPA reviews that proposed NNSR program for PM2.5 and the
NNSR precursor demonstration and either determines that the SIP
submission is incomplete or disapproves both the NNSR program and the
NNSR precursor demonstration. Thus, the regulation of VOC and ammonia
as regulated NSR pollutants (PM2.5 precursors) pursuant to
Appendix S will occur in three circumstances. First, in the absence of
a plan submission that includes the appropriate NNSR precursor
demonstration, VOC and ammonia will be phased in as regulated
precursors pursuant to Appendix S 24 months after the effective date of
area designations for PM2.5. This will prevent states that
fail to make a complete plan submission from continuing to rely on
Appendix S to regulate only SO2 and NOX as
PM2.5 precursors indefinitely. Second, if the EPA determines
that the portion of the SIP containing the NNSR precursor demonstration
submitted by the state is incomplete within the time allowed under CAA
section 110(k)(1)(B), all precursors must be regulated upon EPA's
determination of incompleteness or by the prescribed phase-in date,
whichever date is later. The EPA believes it is important to condition
the phase-in of VOC and ammonia regulation on the completeness of the
SIP submission in order to deter the submission of plans that do not
meet certain minimum criteria simply to avoid the regulation of these
additional precursors.\231\ Finally, if the EPA disapproves both the
proposed NNSR program for PM2.5 and the accompanying NNSR
precursor demonstration, the relevant precursors will be phased in to
be regulated under Appendix S as of the effective date of the
disapproval or by the prescribed phase-in date, whichever date is
later.\232\
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    \231\ The minimum requirements for evaluating the completeness
of such submissions can be found in 40 CFR part 51, Appendix V,
Criteria for Determining the Completeness of Plan Submissions.
    \232\ If the EPA disapproves a state's NNSR precursor
demonstration but the state's NNSR program is otherwise approvable,
the EPA may partially disapprove the NNSR SIP provisions for failure
to properly regulate sources of the relevant precursor and otherwise
partially approve the program. Upon the partial approval of a
state's NNSR program, Appendix S will no longer be the applicable
set of requirements by which NNSR permits are to be issued by the
state. Thus, the phase-in of the relevant precursor will only occur
in the event that the EPA both disapproves the NNSR program for
PM2.5 and the state's NNSR precursor demonstration. The
partial disapproval of a state's NNSR program with respect to the
regulation of a precursor will obligate the EPA to promulgate a
federal implementation plan (FIP) pursuant to CAA section 110(c)(1)
to address the regulation of that precursor within 2 years of the
disapproval unless the Administrator approves a state plan or plan
revision correcting the deficiency. The disapproval will also
trigger the application of sanctions pursuant to CAA section 179(a)
unless the state corrects the deficiency within 18 months.
---------------------------------------------------------------------------

    The EPA chose this 24-month period for phase-in of VOC and ammonia
as PM2.5 precursors in accordance with (1) the requirement
under CAA section 189(a)(2)(B) of subpart 4 that plan revisions for
PM2.5 attainment plans be submitted to the EPA within 18
months of area designations, and (2) the requirement under CAA section
110(k)(1)(B) that the EPA determine no later than six months after the
date by which a state is required to submit a SIP whether a state has
made a submission that meets the minimum completeness criteria
established per CAA section 110(k)(1)(A).\233\ In order to provide an
appropriate balance between the EPA's interests in providing states
with the opportunity to develop precursor demonstrations prior to
regulation of those precursors and in encouraging states to submit SIPs
in a timely manner, the EPA believes it is reasonable to align the
conditional phase-in of VOC and ammonia as regulated NSR pollutants
(PM2.5 precursors)with the statutory timeframe for states to
make SIP submissions addressing precursor regulation for NNSR and for
the EPA to evaluate whether a state has made a complete submission.
Thus, if by this 24-month deadline, a state has not submitted a
precursor demonstration that VOC and/or ammonia need not be regulated,
which has been determined to be complete by the EPA or deemed complete
by the operation of law by this 24-month deadline, Appendix S will
require regulation of these precursors going forward.
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    \233\ CAA section 110(k)(1)(B) specifically requires the
Administrator to evaluate the completeness of a SIP submission
within 60 days of receipt, but no later than 6 months after the date
by which the SIPs were due. If the Administrator does not
affirmatively evaluate the completeness of the SIP within that time
period, the statute provides that the SIP shall be deemed complete
by operation of law 6 months after receipt.
---------------------------------------------------------------------------

    The EPA has specifically included the 6-month period for EPA's
completeness review because we believe it is important to discourage
states from submitting SIPs that do not meet the minimum completeness
criteria found in 40 CFR part 51, Appendix V. Conditioning the phase-in
on a completeness review will not only encourage states to make timely
SIP submissions addressing the NNSR requirements, but also ensure that
those submissions contain the minimum information necessary to enable
the Administrator to determine whether the SIP complies with the
statute. If a state with a designated PM2.5 nonattainment
area that is currently relying on Appendix S makes a submission
addressing NNSR program requirements, including a NNSR precursor
demonstration, within 18 months of the designation (as required by CAA
section 189(a)(2)(B)), either EPA

must evaluate the submission for completeness within 6 months or the
SIP will become complete by operation of law, pursuant to CAA section
110(k)(1)(B). The latest date that a timely-submitted implementation
plan would be determined to be complete by the EPA or deemed complete
by operation of law is 24 months from the effective date of the
PM2.5 nonattainment area designation. In other words, in the
absence of EPA action to evaluate completeness, a state that submits a
timely SIP addressing NNSR and including a NNSR precursor demonstration
can be confident the submission will become complete by operation of
law by the 24-month conditional phase-in date, and such states will not
be required to regulate the precursor addressed by its demonstration
(VOC or ammonia) in the PM2.5 nonattainment area pursuant to
Appendix S during the period of EPA's review of the SIP. States that
submit untimely SIPs, after the 18-month SIP submission deadline,
cannot rely on the SIP becoming complete by operation of law before the
24-month conditional phase-in date. If the EPA has not acted to
evaluate the completeness of the state's untimely SIP by the 24-month
conditional phase-in, control of VOC and ammonia are automatically
phased in for the PM2.5 nonattainment area under Appendix S,
regardless of whether such SIP submission might later be determined
complete, whether by EPA or by operation of law. Thus, if a state
submits an untimely SIP addressing NNSR for a particular
PM2.5 nonattainment area, including an NNSR precursor
demonstration, such state can only avoid the conditional phase-in of
VOC and ammonia control pursuant to Appendix S if the EPA affirmatively
determines the submission to be complete by 24 months from the date of
the area designation. In such circumstances, states are encouraged to
coordinate with the appropriate EPA Regional Office.
    The timing of the phase-in for a particular area will depend upon
the effective date of the designation to nonattainment for
PM2.5. Because this rule establishes requirements that apply
in both present and future nonattainment areas, the regulations address
the timing of the precursor phase-in both for areas already designated
nonattainment for PM2.5 and for areas that may be so
designated in the future.
    For any existing nonattainment area that was first designated
nonattainment for PM2.5 effective on or before April 15,
2015 (which includes areas designated for the 1997, 2006 and 2012
PM2.5 NAAQS), VOC and ammonia will be required to be
controlled as PM2.5 precursors for any NNSR permit issued on
or after April 15, 2017 (24 months from the date of area designations
for the 2012 PM2.5 NAAQS), unless the state has submitted
before the phase-in date a complete SIP revision that includes the
state's proposed NNSR program for PM2.5 and a NNSR precursor
demonstration showing that VOC, ammonia, or both do not contribute
significantly to PM2.5 concentrations that exceed the
standard in a given PM2.5 nonattainment area, consistent
with the requirements of 51.1003, in which case the control of the
precursors addressed by the submitted demonstration will not be
required to be controlled at the 24-month mark. See Appendix S, section
II.A.31.(ii)(b)(3). In order to satisfy this condition, such
demonstration must be submitted in the form of a SIP revision and must
either be determined to be complete by the EPA or deemed to be complete
by operation of law pursuant to the provisions in CAA section
110(k)(1)(B).
    Although areas were designated nonattainment for the 1997, 2006,
and 2012 standards at different times, the EPA believes it is
reasonable to apply the same phase-in date for all areas designated
nonattainment as of the date of the designations for the 2012 standard.
Area designations for the 2012 PM2.5 standards were
finalized on April 15, 2015, and plans addressing the nonattainment
area requirements as to that standard are due October 15, 2016.
Therefore, states evaluating their NNSR programs in light of the
subpart 4 requirements with respect to the 2012 standard will have
some, if limited, opportunity to consider the requirements of this rule
and EPA's technical guidance before submitting a plan revision
addressing the statutory and regulatory requirements. By contrast, area
designations for the 1997 standards were finalized many years ago. As
to those areas, after the court's decision in NRDC v. EPA, the EPA
promulgated a rule setting a deadline of December 31, 2014, for states
to submit any attainment plan provisions that may be necessary to
satisfy the subpart 4 requirements. 79 FR 31566 (June 2, 2014) at
31570. This included any submissions necessary to address NNSR
permitting such as the CAA section 189(e) requirement that states
regulate all PM2.5 precursors absent a demonstration that
such regulation is unnecessary. This deadline superseded previous SIP
submission deadlines initially established by application of the
subpart 1 requirements. As that deadline has passed, if the EPA were to
apply the 24-month phase-in policy strictly, states relying upon
Appendix S to issue NNSR permits in these areas would have had to
commence regulating VOC and ammonia as PM2.5 precursors in
June 2015--6 months after the SIP submission deadline. The EPA believes
it is reasonable to provide states that have areas designated
nonattainment with respect to the 1997 and 2006 PM2.5
standards with at least some limited opportunity to consider the
requirements of this rule and EPA's technical guidance and submit a
plan revision addressing the statutory and regulatory requirements
before the state will be required to regulate sources of VOC and
ammonia in such areas. Accordingly, the EPA finds that it is reasonable
to subject all areas designated nonattainment for any PM2.5
standard as of April 15, 2015, to the same Appendix S requirements in
this final rule.
    For any area that is first designated nonattainment for any
PM2.5 NAAQS after April 15, 2015 (that is, the area was not
already designated nonattainment with respect to another
PM2.5 NAAQS immediately prior to such date), any state
relying on Appendix S to issue a NNSR permit on or after the effective
date of such area designation must require control of SO2
and NOX as regulated NSR pollutants (PM2.5
precursors). Beginning on the date 24 months from the effective date of
such area designation, a state relying on Appendix S to issue a NNSR
permit must also require control of VOC and ammonia as regulated NSR
pollutants (PM2.5 precursors) in that area, unless by that
date the state has submitted a complete SIP revision that includes the
state's proposed NNSR program for PM2.5 and an accompanying
NNSR precursor demonstration that sources of VOC, ammonia, or both
ammonia do not contribute significantly to the PM2.5
concentrations that exceed the standard in the PM2.5
nonattainment area. See Appendix S, section II.A.31.(ii)(b)(4). As
explained earlier, such demonstration must be submitted as part of a
SIP revision that is determined to be complete by the EPA or deemed to
be complete by operation of law by the conditional phase-in date.
    As noted earlier, the second phase-in provision applies to
PM2.5 nonattainment areas that were not already designated
as nonattainment for PM2.5 immediately prior to that date.
If at the time of a new designation, an area was already designated
nonattainment as to any prior PM2.5 NAAQS, and Appendix S
applied and continues to apply for NNSR permitting with respect

to that existing nonattainment area, all PM2.5 precursors
would likely already be required to be regulated in accordance with a
prior phase-in schedule prescribed under Appendix S for that existing
nonattainment designation. In such cases, all precursors would continue
to be subject to regulation for NNSR permitting under Appendix S, even
as to the new nonattainment designation. That is, once Appendix S
definition of regulated NSR pollutant applies to all PM2.5
precursors in a given nonattainment area, it is not possible to later
defer regulation of any precursors so long as the state continues to
rely on Appendix S for NNSR permitting in that area. Once the state
submits a SIP including an NNSR program and any appropriate NNSR
precursor demonstration, and the EPA approves the SIP, Appendix S will
no longer apply for the issuance of NNSR permits for PM2.5.
iii. Comments and Responses
    Comment: Several commenters generally supported the EPA's preferred
approach in the proposal that would require only SO2 and
NOX as PM2.5 precursors for NNSR permits issued
pursuant to Appendix S. One commenter supported the alternative
approach to phase in VOC and ammonia as PM2.5 precursors,
while another commenter expressly opposed the EPA's preferred approach
and the phase-in alternative, claiming that any approach that does not
regulate all four scientific precursors of PM2.5 is contrary
to CAA subpart 4 and unlawful.
    Commenters supporting the preferred approach did not believe that
it was appropriate to require NSR permitting during an interim period
for sources that may be exempted from control requirements if a state
can demonstrate that these sources do not contribute significantly to
nonattainment in a particular area. These commenters stated that, since
most, if not all, areas will not be able to demonstrate that
SO2 and NOX do not contribute significantly to
nonattainment levels of PM2.5, the EPA's approach to include
these two precursors in the interim is reasonable.
    One commenter who supported the EPA's alternative approach to phase
in VOC and ammonia as PM2.5 precursors stated that there are
many unanswered questions and the science is not adequate to justify
regulation of secondary formation precursors at this time. The
commenter further stated that Appendix S should initially require
sources issued a NNSR permit to control only SO2 and
NOX as PM2.5 precursors, and only later, after a
prescribed date (e.g., the date on which SIP revisions based on subpart
4 requirements are due), require sources to control emissions of VOC
and ammonia, if applicable.
    A commenter who opposed any approach that did not immediately
require the control of all four scientific precursors of
PM2.5 stated that such approaches are unlawful and must be
rejected. The commenter stated that the EPA must require immediate
regulation of all four precursors, as only that alternative follows the
plain language of the CAA and the NRDC decision. The commenter objected
to the presumptive exemption of VOC and ammonia emissions as being
identical to the ``gamesmanship'' that both Congress intended to
curtail with subpart 4, and that the DC circuit found illegal in the
NRDC decision. The commenter stated that the scope of the statutory
definition, and consequently the application of subpart 4, did not
change when the EPA subdivided PM10 by regulation. The
commenter stated that only this option would conform Appendix S to the
requirements of subpart 4, and in so doing, align Appendix S with
forthcoming state obligations to harmonize the PM2.5
portions of their SIPs with the obligations of subpart 4. The commenter
stated that this approach would encourage states to submit SIPs in a
timely fashion, rather than to rely on Appendix S for an extended
period of time. The commenter stated that, in contrast, were the EPA to
adopt illegally lax provisions into Appendix S, states might delay
submitting replacement SIPs, particularly in those parts of the country
with high VOC or ammonia precursor emissions.
    Response: The EPA took each of these comments into consideration in
concluding that the proposed phase-in alternative is a reasonable
approach that balances competing factors regarding the regulation of
PM2.5 precursors for NNSR permits issued pursuant to
Appendix S. While CAA section 189(e) generally requires state plans to
control all PM2.5 precursors, it also affords states an
opportunity to demonstrate that a particular precursor does not
contribute significantly to levels of PM2.5 that exceed the
standard in a PM2.5 nonattainment area. Section 189(e) of
the CAA clearly addresses how PM2.5 precursors must be
regulated in the state's plan, but the statute does not address exactly
when precursors are to be regulated pursuant to the NNSR requirements
of Appendix S prior to the submission of the state's plan. As noted
earlier, the NNSR provisions are unique among the nonattainment area
requirements in that sources are required to address NNSR immediately
upon the effective date of an area's designation to nonattainment,
rather than upon the EPA's approval of the state's SIP, which could be
as much as 3 years after the nonattainment area designation (e.g.,
states have 18 months to submit attainment plans and the EPA may have
up to 18 months from the date of the SIP submission to finalize action
on such plans). Given this ambiguity in the statute and the unique
application of the NNSR requirements, we believe a reasonable and
balanced approach to the Appendix S requirements would allow states a
time-limited period to submit a NNSR program for PM2.5 that
includes a NNSR precursor demonstration that sources of a precursor do
not contribute significantly to PM2.5 levels in a
PM2.5 nonattainment area. The time limit will discourage
states from unreasonably delaying regulation of such precursors where
otherwise required to do so.
    Moreover, the EPA believes it is reasonable to construct the
Appendix S provisions regulating PM2.5 precursors in a
manner that closely follows the way in which the precursors are being
regulated in most state NSR programs based on EPA's 2008 NSR
regulation. For areas that were designated attainment or unclassifiable
prior to a new nonattainment designation, the PSD permit program was in
effect and required that, at minimum, SO2 and NOX
be regulated as PM2.5 precursors. It is therefore reasonable
to ensure that those precursors continue to be regulated as part of the
interim NNSR permit program via Appendix S. Moreover, in areas that
were already designated nonattainment for a pre-existing
PM2.5 NAAQS, and an approved plan containing NNSR permit
requirements for PM2.5 is in effect, sources are required to
control SO2 and NOX as PM2.5
precursors, as required under the 2008 PM2.5 NSR rule, until
the EPA approves a SIP revision conforming those NNSR programs to the
requirements of CAA subpart 4. Similarly, the EPA believes it is
reasonable to not require the regulation of VOC and ammonia immediately
upon designation of an area to nonattainment because it result in more
regulation in newly designated nonattainment areas relying on Appendix
S than is required in most states with approved programs. All states
will ultimately be required to address the regulation of ammonia and
VOC at the time their state plans are due or, failing submission of
such plan by states relying on Appendix S to issue NNSR permits,
Appendix S will require such regulation.

    The phase-in schedule contained in this final rule requires that
VOC and ammonia be phased in as PM2.5 precursors 24 months
from the effective date of area designations for PM2.5;
however, states will not be required to control VOC and ammonia as
PM2.5 precursors as part of a NNSR permit issued under
Appendix S so long as the state submits a plan revision that includes
the state's NNSR program for PM2.5 and a NNSR precursor
demonstration to show that sources of a precursor does not contribute
significantly to PM2.5 levels that exceed the standard in a
PM2.5 nonattainment area. See Appendix S, sections
II.A.31.(ii)(b)(3) and (4).
    In initially requiring sources to control SO2 and
NOX as regulated NSR pollutants (PM2.5
precursors), states that rely on Appendix S to issue NNSR permits
generally will implement NNSR consistent with those states that issue
NNSR permits for PM2.5 under the NNSR program in their
approved SIP. The EPA believes that it is reasonable and appropriate to
assure this consistency in the issuance of NNSR permits during the
interim period when all states must revise their plans to address the
2012 PM2.5 NAAQS. Moreover, this final rule allows states to
submit a SIP revision that contains a NNSR precursor demonstration
showing that new major stationary sources and major modifications of
either SO2 or NOX should be exempted where an
analysis of increases in emissions of the particular precursor shows
that sources of the precursor do not contribute significantly to
PM2.5 levels that exceed the standard in the
PM2.5 nonattainment area. In this case, the opportunity to
exempt sources of either SO2 or NOX as
PM2.5 precursors is addressed in the NNSR rules at 51.165.
See 40 CFR 51.165(a)(13). Hence, when the EPA approves a state's plan
revision containing the NNSR program for PM2.5 and a NNSR
precursor demonstration showing an insignificant contribution, a new
major stationary source or major modification of either SO2
or NOX as PM2.5 precursors will not be required
to be controlled going forward in a NNSR permit issued to address
PM2.5, which permit would then be issued in accordance with
the NNSR requirements in the approved plan, rather than the NNSR
requirements in Appendix S.
    With regard to the commenter's concern that states might delay
submitting NNSR programs as part of their PM2.5 SIPs if
Appendix S regulates only SO2 and NOX, the phase-
in approach in this final rule will negate any incentive that a state
may have to delay submitting an NNSR program for PM2.5
addressing the CAA section 189(e) requirement to regulate all four
precursors, absent a showing that such regulation is unnecessary. In
fact, the phase-in requirement should actually encourage states to
timely submit their NNSR programs for PM2.5. Given CAA
section 189(e) does not directly speak to its application to the
Appendix S requirements, the EPA believes this approach represents a
reasonable and equitable application of the CAA section 189(e)
requirements regarding regulation of PM2.5 precursors to
states applying Appendix S.
b. Appendix S Definition of ``major stationary source'' in Serious
PM2.5 Nonattainment Areas
i. Summary of Proposal
    The EPA proposed to amend Appendix S by revising the definition of
``major stationary source'' to include a separate PM2.5
major source threshold applicable to new major stationary sources and
major modifications of direct PM2.5 and PM2.5
emissions in PM2.5 nonattainment areas reclassified as
Serious. This proposed amendment to Appendix S was similar to one that
was proposed to the definition of ``major stationary source'' in 40 CFR
51.165.\234\
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    \234\ The preamble language did not explicitly state that it was
our intent to revise the definition in Appendix S to add separate
major source thresholds for direct PM2.5 emissions and
PM2.5 precursors, in the same way that earlier we had
proposed to revise the definition of ``major stationary source'' in
the NNSR regulations at 40 CFR 51.165. Instead, the preamble
referred only to a change to the definition of ``major stationary
source'' at proposed section II.A.4(i)(a)(7) of Appendix S, where a
70 tpy threshold for direct PM2.5 emissions is addressed.
The proposed regulatory text did, however, also include new section
II.A.4(i)(a)(8) of Appendix S, which adds a 70 tpy major source
threshold for emissions of individual PM2.5 precursors.
Despite this omission in the preamble discussion of the proposed
changes to Appendix S, we believe that commenters had ample
opportunity to comment on the actual changes being made to the
definition of ``major stationary source'' in Appendix S because the
intended change concerning emissions of PM2.5 and
PM2.5 precursors was accurately provided in the
regulatory text.
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ii. Final Rule
    In this final rule, the EPA is amending the definition of ``major
stationary source'' in Appendix S to include 70 tpy major source
thresholds for direct PM2.5 emissions and individual
PM2.5 precursors, applicable in Serious PM2.5
nonattainment areas.\235\ See Appendix S sections II.A.4(i)(a)(7) and
(8), respectively. As described earlier, applicability of the NNSR
requirements to a source will be determined individually for direct
PM2.5 emissions and for emissions of individual
PM2.5 precursors. For example, if a new source locating in a
Serious PM2.5 nonattainment area would emit 70 tpy of the
PM2.5 precursor SO2, it will be considered a
major source of PM2.5 (with respect to the SO2
precursor) and will be subject to the NNSR requirements for
PM2.5 with regard to the SO2 emissions. However,
if the same proposed source does not emit 70 tpy of direct
PM2.5 emissions or another PM2.5 precursor, the
emissions increase of direct PM2.5 or the other precursor
will not be subject to control based on the NNSR requirements for
PM2.5. It should also be noted that VOC and ammonia are
subject to the phase-in schedule described in the definition of
``regulated NSR pollutant'' in the NNSR regulations at Appendix S,
section II.A.31.(ii)(b)(2).
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    \235\ The EPA also notes that the definition of ``major
stationary source'' in Appendix S is being revised in this rule at
section II.A.4(i)(a) of Appendix S, which currently ends with the
phrase ``according to paragraphs II.A.4(i)(a)(1) through (6) of this
ruling.'' By proposing to add new paragraphs (7) and (8), this
phrase will be revised to read ``according to paragraphs
II.A.4(i)(a)(1) through (8) of this ruling.'' The phrase is being
modified accordingly in this final rule.
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iii. Comments and Responses
    As explained in Section VIII.B.1.b of this preamble, commenters
addressing the proposed major source threshold of 70 tpy for sources of
PM2.5 and its precursors locating in Serious areas had mixed
responses, particularly with regard to the appropriate thresholds for
precursors. Most of the comments applied generally to the proposed
thresholds in 40 CFR 51.165 and Appendix S. The EPA's responses to
these comments are provided in that earlier section of the preamble.
    Comment: One commenter, however, recommended that during the SIP
transition period (and while the EPA continues its analysis of the
precursor relationships to PM2.5), the EPA should allow
states to make a case-by-case permitting demonstration to use higher
major source thresholds for precursors for NNSR permit reviews.
    Response: As explained previously, in light of the ongoing
precursor impact studies as well as concerns about the legality of
setting higher major source thresholds than those specified in the CAA,
the EPA believes it is most reasonable to establish a 70 tpy major
source threshold under Appendix S for sources of direct
PM2.5 emissions and each PM2.5 precursor locating
in Serious nonattainment areas.

c. Significant Emissions Rates (SERs) in Appendix S--PM2.5
Precursors
i. Summary of Proposal
    As explained earlier, the EPA proposed as its preferred approach to
add NOX as a PM2.5 precursor in the Appendix S
definition of ``regulated NSR pollutant.'' Accordingly, the EPA also
proposed to amend the definition of ``significant'' at section
II.A.10(i) of Appendix S to establish a SER of 40 tpy for
NOX as a PM2.5 precursor. The Appendix S
definition already contains a SER for SO2 as a
PM2.5 precursor at 40 tpy of SO2. The EPA did not
explicitly propose to include SERs for VOC and ammonia in Appendix S as
part of the preferred approach; however, the EPA's proposed alternative
approach to phase in VOC and ammonia as PM2.5 precursors at
a later date would inherently necessitate adding SERs for those two
additional precursors in the event that an alternative approach was
ultimately selected for the final rule.
ii. Final Action
    The EPA is revising the definition of ``significant'' in Appendix S
at section II.A.31(ii)(b)(2) to provide SERs for NOX and VOC
as PM2.5 precursors, consistent with its decision to
conditionally phase in regulation of all four PM2.5
precursors 24 months from the date of redesignation. The individual
SERs for NOX and VOC as PM2.5 precursors, being
added to the existing SER for SO2 as a PM2.5
precursor, are each defined as 40 tpy of the respective precursor,
consistent with the SERs provided in the revised definition of
significant in 40 CFR 51.165.
    The EPA is not adding a SER for ammonia (as a PM2.5
precursor) in the Appendix S definition of ``significant'' in this
action. Consistent with the EPA's approach for allowing states to
define ``significant'' for ammonia in their NNSR rules, and for the
reasons explained in Section VIII.B.1.c of this preamble, the EPA will
allow states that issue NNSR permits pursuant to the requirements in
Appendix S to define ``significant'' with respect to ammonia in a
particular area in each NNSR permit issued pursuant to Appendix S. The
state should provide a technical justification to support the
definition of ``significant'' for ammonia, including any SER developed
by the state for a particular nonattainment area, and such
justification should be included in the administrative record for each
proposed permit. The state also has the discretion to define
``significant'' with respect to ammonia as a PM2.5 precursor
in those cases where it is determined that the proposed modification
will result in insignificant increases of ammonia and the source will
therefore not be required to obtain a major NNSR permit. In such cases,
the state and the source should also document the technical
justification for determining the source impacts will be insignificant,
including any SER developed by the state for a particular nonattainment
area, whether such documentation occurs in the administrative record
for a minor source permit, a nonapplicability determination, or some
other form in the state or source's records. The state should consult
with the appropriate EPA Regional Office for assistance in developing
an appropriate definition of ``significant'' for ammonia as a
PM2.5 precursor in each permit or for each nonattainment
area.
iii. Comments and Responses
    The comments regarding the proposed addition of SERs for
NOX and VOC emissions as PM2.5 precursors in the
NNSR definition of ``significant'' were summarized in Section
VIII.B.1.c of this preamble. Those comments applied generally to the
NNSR regulations at 40 CFR 51.165 and Appendix S. The reader is
referred to that earlier section of the preamble to review the comments
and the EPA's responses to them.
    Comment: Some commenters seemingly addressing NNSR under Appendix S
recommended that the EPA include a provision allowing states to make
case-by-case determinations to use higher SERs for precursors for NNSR
permits issued before the SIP is effective. The commenter stated that
the precursor SERs are too low and do not realistically reflect the
effect that each precursor has on ambient PM2.5
concentrations.
    Response: The EPA believes that the commenter's concern is
partially addressed by the fact that, in using Appendix S to review
NNSR permit applications, neither VOC nor ammonia will need to be
controlled as PM2.5 precursors if the state has submitted to
the EPA a complete SIP submission that includes the state's NNSR
program for PM2.5 and a NNSR precursor demonstration showing
that a particular precursor does not contribute significantly to
ambient concentrations of PM2.5 in the nonattainment area,
even though the plan revision containing such demonstration has not yet
been formally approved. Until the SIP development period has passed and
unless the state has failed to submit such a demonstration, the state
issuing permits pursuant to Appendix S will not be required to regulate
VOC or ammonia as PM2.5 precursors. If a state has not
submitted a SIP including the state's NNSR program for PM2.5
and a NNSR precursor demonstration for either VOC or ammonia, sources
of these precursor emissions must be controlled as PM2.5
precursors in any NNSR permit issued pursuant to Appendix S beginning
on the prescribed phase-in date.

C. Transition Provisions for Major Source Permitting in
PM2.5 Nonattainment Areas

    The EPA did not propose any transition provisions for NNSR permit
applications in either 40 CFR 51.165 or Appendix S that would expressly
grandfather pending PSD or NNSR permit applications for proposed new
and modified major stationary sources from newly established NNSR
permit requirements applicable to PM2.5 nonattainment areas.
In the final 2012 PM NAAQS Rule, the EPA provided a grandfathering
provision only for certain PSD permit applications with respect to the
revised PM2.5 standard. Historically, the EPA has not
provided for the grandfathering of any permit applications from new
NNSR requirements or from application of existing NNSR requirements to
new or revised standards. Nevertheless, in promulgating the 2012 PM
NAAQS Rule, the EPA received unsolicited comments advocating for
grandfathering of NNSR requirements for the revised standard. Thus,
while explaining the reasons why it did not believe that NNSR
grandfathering was appropriate, the EPA sought comments in the proposal
on possible circumstances where grandfathering similar to the PSD
grandfathering provision established for the 2012 PM2.5
standard might be appropriate with respect to changes made regarding
NNSR requirements for PM2.5 in this rulemaking.
    Several comments received during the 2012 p.m. NAAQS rulemaking
recommended that the EPA establish a grandfathering provision for NNSR
as was proposed for the PSD program. A subset of these commenters
recommended that PSD permit applications be grandfathered from the NNSR
requirements for the revised 2012 PM2.5 standard by
establishing an effective date for designations 1 year after initial
publication in the Federal Register. The commenters presumably believed
that by delaying the effective date of any new nonattainment
designations for the primary annual PM2.5 NAAQS, sources
with pending PSD permit applications could continue to be reviewed and
permits issued under the PSD requirements rather than the NNSR
requirements for PM2.5.

    The EPA explained at the time that the obligation to adopt new
provisions under a state's NNSR program will not apply with regard to
the revised NAAQS until such time as an area is designated
nonattainment, and beginning on the effective date of the new area
designations for PM2.5, proposed new and modified major
sources would be required to meet the applicable NNSR requirements for
PM2.5.\236\ Also, the EPA does not agree with the
commenters' recommendation that the effective date of the area
designation be delayed by 1 year because this approach, similar to
delaying the effective date of the NAAQS, would also delay the
implementation of the attainment plan and defer the important health
benefits associated with the revised NAAQS. In the same preamble, the
EPA proposed a schedule for promulgating area designations for
PM2.5 that involved the maximum allowable 2-year period from
the signature date of the 2012 PM2.5 NAAQS, as provided in
CAA section 107(d)(1)(B). The CAA allows for a 1-year extension for
such designations, but only if there is insufficient information to
enable such designations to be made.\237\
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    \236\ The applicable NNSR requirements would be either the NNSR
requirements for PM2.5 in the state's existing approved
SIP or the requirements found at 40 CFR part 51 Appendix S, when a
state's approved SIP does not currently include NNSR requirements
for PM2.5. States will be required to submit to the EPA
for approval SIP revisions containing the amended NNSR program
requirements for PM2.5 contained in the final
PM2.5 NAAQS implementation, but those additional
requirements will not apply in states with approved SIPs that
include NNSR requirements for PM2.5 until the EPA
approves the SIP revision. See 78 FR 3086 (January 15, 2013), at
page 3263.
    \237\ See 78 FR 3249 at page 3250.
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    In response to the EPA's request for comments in the proposal,
commenters recommended that the EPA clarify the PM2.5 NSR
grandfather policy to explain that both PSD and NNSR permit
applications are exempt from the precursor and planning requirements
being finalized in this rulemaking. In particular, the commenters
recommended that the EPA establish a PM2.5 NSR transition
policy that delays regulation of the scientific precursors of
PM2.5 under any NSR program until the EPA has a better
understanding of how these precursors contribute to nonattainment and
could deteriorate air quality. One of the commenters indicated that a
transitional policy is especially important until the EPA completes a
rulemaking on a SER for ammonia. One of the commenters recommended that
the EPA should allow for the grandfathering of pending PSD permit
applications, similar to the PSD grandfathering provision for the 2012
PM2.5 NAAQS, for sources that will not be issued a permit
until after the effective date of the nonattainment designation under
certain conditions. This commenter stated that CAA section 165(c),
which forms part of the EPA's basis for grandfathering in the PSD
context, should also apply to NNSR permit decisions.
    The EPA does not find a compelling reason to grandfather pending
NNSR permit applications for which a permit has not yet issued once the
new NNSR requirements--primarily affecting the control of
PM2.5 precursors--become effective. The EPA believes that it
is reasonable to require that a new or modified major stationary source
control emissions of PM2.5 precursors where such emissions
contribute significantly to PM2.5 levels in the
nonattainment area. If such precursor emissions are not effectively
controlled, and offset by reductions in existing emissions, an
increased burden could be placed on the overall attainment plan to
address those emissions in order to attain the NAAQS in a timely
manner.
    While the final rule contains no general grandfathering provision,
this final rule does provide a phase-in process for states relying on
Appendix S for purposes of issuing NNSR permits for PM2.5.
Appendix S will require the immediate regulation of SO2 and
NOX as PM2.5 precursors, the regulation of VOC
and ammonia as PM2.5 precursors will only be required under
certain conditions and on a delayed timetable. See Appendix S, revised
section II.A.31.(ii)(b)(2)-(5). The precursor provisions in Appendix S
should alleviate some of the commenter's concerns that the regulation
of additional precursors will be required immediately upon the
effective date of this final rule. Instead, the phase-in schedule for
the regulation of VOC and ammonia will permit states the opportunity
allowed by CAA section 189(e) to demonstrate that a particular
precursor need not be subjected to control in a particular
nonattainment area. Accordingly under the interim NNSR requirements in
Appendix S, a state will not be required to begin immediate regulation
of precursors for which sources will likely be exempted from the
regulations upon review of a state's NNSR SIP submission. Similarly,
where the state has a previously approved NNSR program for
PM2.5, the existing requirements for controlling precursors
would continue to apply until the new SIP revisions required by this
rule, including new precursor control requirements, are approved. Thus,
such states would not be required to immediately regulate any
PM2.5 precursors not already required by the approved plan
during the interim plan development period.
    With regard to grandfathering PSD permit applications, we do not
interpret the CAA to allow for the issuance of a PSD permit in an area
that is designated nonattainment. The CAA requires proposed major
stationary sources and major modifications to meet major NSR permitting
requirements that apply on the basis of the area's designation.\238\
Accordingly, the EPA's longstanding interpretation of the CAA is that a
proposed new major stationary source or major modification must satisfy
the appropriate major NSR requirements (PSD vs. NNSR) for a particular
pollutant that are in effect in a given area on the date that a permit
is issued to the source, rather than the requirements that may have
been applicable when the permit application was submitted.\239\
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    \238\ Compare CAA section 165(a) (permitting requirements for
sources locating in attainment and unclassifiable areas) with CAA
sections 172(c)(5) and 173 (permitting requirements for sources
locating in nonattainment areas).
    \239\ See Memorandum from John S. Seitz, Director, EPA Office of
Air Quality Planning and Standards, on March 11, 1991, titled ``New
Source Review (NSR) Transitional Guidance,'' Attachment p. 6, sent
to Regional Air Division Directors.
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IX. Other Requirements and Considerations for PM2.5
Nonattainment Areas

A. Waivers Under CAA Section 188(f)

1. Statutory Requirements and Existing Guidance
    a. Summary of Proposal. The proposal summarized the statutory
requirements and existing guidance for CAA section 188(f), which
provides that, ``the Administrator may, on a case-by-case basis, waive
any requirement applicable to any Serious Area . . . where the
Administrator determines that anthropogenic sources of PM10
do not contribute significantly to the violation of the PM10
standard in the area.'' In addition it provides that, ``the
Administrator may also waive a specific date for attainment of the
[PM10] standard where the Administrator determines that
nonanthropogenic sources of PM10 contribute significantly to
the violation of the PM10 standard in the area.'' The agency
requested comment on whether the existing guidance in the Addendum is
appropriate when implementing the current and any future
PM2.5 NAAQS.
    b. Final Rule. The EPA is hereby affirming its reliance on the
interpretation of CAA section 188(f) described in the Addendum for

purposes of implementing the PM2.5 NAAQS.\240\ For example,
the Addendum lays out a series of questions that should be answered
before the waiver provisions can be applied, including questions
related to the types of sources that may be considered anthropogenic
and nonanthropogenic, the specific conditions under which the
attainment date for a Moderate area may be waived, and the time period
that would apply to an attainment date waiver. The EPA believes that
these questions, and the general guidance provided in the Addendum on
how to evaluate the answers, provide adequate direction to the EPA and
to states potentially interested in seeking waivers for certain
PM2.5 NAAQS nonattainment areas. The EPA therefore refers
interested states to the waiver guidance contained in the Addendum for
more detail on how the agency interprets CAA section 188(f) for
purposes of implementing the PM2.5 NAAQS.
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    \240\ See 59 FR 42003-42008, August 16, 1994.
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    c. Comments and Responses. The comments received on this section
are addressed in the Response to Comments document found in the docket
for this action.
2. Relationship Between the CAA Section 188(f) Waiver Provisions and
the EPA's Exceptional Events Rule
    a. Summary of Proposal. The proposal summarized the relationship
between the 188(f) waiver provisions and the EPA's Exceptional Events
Rule. On March 22, 2007, the EPA promulgated the ``Treatment of Data
Influenced by Exceptional Events; Final Rule'' (72 FR 13560), known as
the Exceptional Events Rule, pursuant to the 2005 amendment of CAA
section 319.\241\ The Exceptional Events Rule provides a mechanism by
which the EPA can concur with a state's request to exclude from
regulatory decisions air quality monitoring data determined by the EPA
to have been affected by exceptional events.\242\ The Exceptional
Events Rule applies to all the NAAQS pollutants, including
PM2.5. CAA section 188(f) and the Exceptional Events Rule
provide separate mechanisms by which states can seek to have event-
influenced monitoring data excluded from certain regulatory
requirements or decisions associated with the PM NAAQS implementation
process, under appropriate circumstances.
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    \241\ Section 319 of the CAA, as amended by section 6013 of the
Safe Accountable Flexible Efficient-Transportation Equity Act: A
Legacy for Users (SAFE-TEA-LU) of 2005, required the EPA to propose
and promulgate regulations governing the review and handling of air
quality monitoring data influenced by exceptional events.
    \242\ References to ``air agencies'' are meant to include state,
local and tribal air agencies responsible for implementing the
Exceptional Events Rule.
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    b. Final Rule. The EPA did not make any revisions to its
interpretation of the relationship between the CAA section 188(f)
waiver provisions and EPA's Exceptional Events Rule.
    The Exceptional Events Rule addresses elevated emissions from
specific events that influence monitored air quality concentrations.
The EPA's regulations at 40 CFR 50.1(j) define an ``exceptional event''
as one that ``affects air quality, is not reasonably controllable or
preventable, is an event caused by human activity that is unlikely to
recur at a particular location or a natural event, and is determined by
the Administrator in accordance with 40 CFR 50.14 to be an exceptional
event.'' Further, 40 CFR 50.1(j) explicitly provides that exceptional
events do ``. . . not include stagnation of air masses or
meteorological inversions, a meteorological event involving high
temperatures or lack of precipitation, or air pollution relating to
source noncompliance.'' At 40 CFR 50.1(k), the EPA's regulations define
a ``natural event'' as an event in which human activity plays little or
no direct causal role to the event in question.\243\
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    \243\ The EPA will generally consider human activity to have
played little or no direct role in causing emissions of the dust
generated by high wind for purposes of the regulatory definition of
``natural event'' if contributing anthropogenic sources of the dust
are reasonably controlled at the time of the event, regardless of
the amount of dust coming from these reasonably controlled
anthropogenic sources, and thus the event could be considered a
natural event. In such cases, the EPA believes that it would
generally be a reasonable interpretation of its regulations to find
that the anthropogenic source had ``little'' direct causal role. If
anthropogenic sources of windblown dust that are reasonably
controllable but that did not have those reasonable controls applied
at the time of the high wind event have contributed significantly to
a measured concentration, then the event would not be considered a
natural event. See preamble to the Exceptional Events Rule at 72 FR
13560 (March 22, 2007), footnote 11 on page 13566.
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    Air quality monitoring data that the EPA determines to have been
influenced by an exceptional event under the procedural steps,
substantive criteria, and schedule specified in the Exceptional Events
Rule may be excluded from regulatory decisions such as initial area
designations decisions and decisions associated with implementing the
PM2.5 NAAQS such as clean data determinations, evaluation of
attainment demonstrations, and discretionary or mandatory
reclassifications of nonattainment areas from Moderate to Serious.
While the EPA may agree with a state's request to exclude event-
influenced air quality monitoring data from regulatory decisions, these
regulatory actions require the EPA to provide an opportunity for public
comment on the claimed exceptional event and all supporting data prior
to the EPA taking final agency action.
    If wildfire is a potential contributor to exceedances of the NAAQS
and exceptional events, the EPA urges state and local agencies to
coordinate with the land management agencies, as appropriate, in
developing plans and appropriate public communications regarding public
safety and reducing exposure. This action can directly help states meet
their Exceptional Events Rule obligation whereby ``states must provide
public notice, public education, and must provide for implementation of
reasonable measures to protect public health when an event occurs.''
When wildfire impacts are significant in a particular area, states and
communities may be able to lessen the impacts of wildfires by working
collaboratively with land managers and land owners to employ various
mitigation measures including taking steps to minimize fuel loading in
areas vulnerable to fire.
    The EPA notes that there could be some potential overlap between
the application of the Exceptional Events Rule and CAA section 188(f)
because the conditions necessary for the Administrator to make a
determination under CAA section 188(f)--i.e., the lack of a significant
anthropogenic contribution to a violation--may overlap with conditions
that may be considered an exceptional event, particularly a natural
event, which by definition represents a non-anthropogenic contribution.
The EPA believes that this potential for overlap can best be addressed
by considering the applicability of the Exceptional Events Rule and CAA
section 188(f) in sequence. Thus, the EPA recommends that states first
consider whether the monitored air quality data on specific days were
influenced by an exceptional event. If the state requests and the EPA
agrees with this request and determines that the monitored air quality
data should be excluded from consideration in regulatory decisions,
then using the provisions in the Exceptional Events Rule could address