[Federal Register: September 20, 2007 (Volume 72, Number 182)]
[Proposed Rules]
[Page 53813-53836]
[DOCID:fr20se07-29]

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Part II

Environmental Protection Agency

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40 CFR Part 63

Revision of Source Category Lists for Standards Under Sections 112(c)
and 112(k) of the Clean Air Act; and National Emission Standards for
Hazardous Air Pollutants for Area Sources: Electric Arc Furnace
Steelmaking Facilities; Proposed Rule

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 63

[EPA-HQ-OAR-2004-0083; FRL-8470-2]
RIN 2060-AM71

Revision of Source Category Lists for Standards Under Sections
112(c) and 112(k) of the Clean Air Act; and National Emission Standards
for Hazardous Air Pollutants for Area Sources: Electric Arc Furnace
Steelmaking Facilities

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule; notice of revisions to source category lists.

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SUMMARY: EPA is adding electric arc furnace steelmaking facilities to
the list of source categories subject to regulation under Clean Air Act
(CAA) section 112(c)(6) and revising the area source category list for
the Integrated Urban Air Toxics Strategy. At the same time, EPA is
proposing national emission standards for electric arc furnace
steelmaking facilities that are area sources of hazardous air
pollutants (HAP). The proposed standards establish requirements for the
control of mercury emissions that are based on the maximum achievable
control technology (MACT) and requirements for the control of other
hazardous air pollutants that are based on generally available control
technology or management practices.

DATES: Comments must be received on or before October 22, 2007, unless
a public hearing is requested by October 1, 2007. If a hearing is
requested on the proposed rule, written comments must be received by
November 5, 2007. Under the Paperwork Reduction Act, comments on the
information collection provisions must be received by OMB on or before
October 22, 2007.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2004-0083, by one of the following methods:
     http://www.regulations.gov: Follow the on-line

instructions for submitting comments.
     E-mail<EMAIL_ADDRESS>
     Fax:<PHONE_NUMBER>.
     Mail: National Emission Standards for Hazardous Air
Pollutants for Area Sources: Electric Arc Furnace Steelmaking
Facilities Docket, Environmental Protection Agency, Air and Radiation
Docket and Information Center, Mailcode: 2822T, 1200 Pennsylvania Ave.,
NW., Washington, DC 20460. Please include a total of two copies. In
addition, please mail a copy of your comments on the information
collection provisions to the Office of Information and Regulatory
Affairs, Office of Management and Budget (OMB), Attn: Desk Officer for
EPA, 725 17th St., NW., Washington, DC 20503.
     Hand Delivery: EPA Docket Center, Public Reading Room, EPA
West, Room 3334, 1301 Constitution Ave., NW., Washington, DC 20460.
Such deliveries are only accepted during the Docket's normal hours of
operation, and special arrangements should be made for deliveries of
boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2004-0083. EPA's policy is that all comments received will be included
in the public docket without change and may be made available online at
http://www.regulations.gov including any personal information provided,

unless the comment includes information claimed to be confidential
business information (CBI) or other information whose disclosure is
restricted by statute. Do not submit information that you consider to
be CBI or otherwise protected through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site is an ``anonymous

access'' system, which means EPA will not know your identity or contact
information unless you provide it in the body of your comment. If you
send an e-mail comment directly to EPA without going through http://www.regulations.gov
, your e-mail address will be automatically captured

and included as part of the comment that is placed in the public docket
and made available on the Internet. If you submit an electronic
comment, EPA recommends that you include your name and other contact
information in the body of your comment and with any disk or CD-ROM you
submit. If EPA cannot read your comment due to technical difficulties
and cannot contact you for clarification, EPA may not be able to
consider your comment. Electronic files should avoid the use of special
characters, any form of encryption, and be free of any defects or
viruses.
    Docket: All documents in the docket are listed in the http://www.regulations.gov
 index. Although listed in the index, some

information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in hard copy
form. Publicly available docket materials are available either
electronically in http://www.regulations.gov or in hard copy at the

National Emission Standards for Hazardous Air Pollutants for Area
Sources: Electric Arc Furnace Steelmaking Facilities Docket at the EPA
Docket and Information Center in the EPA Headquarters Library, EPA
West, Room 3334, 1301 Constitution Ave., NW., Washington, DC. The
Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through
Friday, excluding legal holidays. The telephone number for the Public
Reading Room is<PHONE_NUMBER>, and the telephone number for the Air
Docket is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Mr. Phil Mulrine, Sector Policies and
Program Division, Office of Air Quality Planning and Standards (D243-
02), Environmental Protection Agency, Research Triangle Park, North
Carolina 27711, telephone number<PHONE_NUMBER>; fax number (919) 541-
3207, e-mail address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this action apply to me?

    The regulated category and entities affected by this proposed
action include:

------------------------------------------------------------------------
                                                  Examples of regulated
            Category             NAICS code \1\          entities
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Industry.......................          331111  Steel mills with
                                                  electric arc furnace
                                                  steelmaking
                                                  facilities.
------------------------------------------------------------------------
\1\ North American Industry Classification System.

    This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be affected by this
action. To determine whether your facility would be regulated by this
action, you should examine the applicability criteria in 40 CFR
63.10680 of subpart YYYYY (National Emission Standards for

Hazardous Air Pollutants for Area Sources: Electric Arc Furnace
Steelmaking Facilities). If you have any questions regarding the
applicability of this action to a particular entity, consult either the
air permit authority for the entity or your EPA regional representative
as listed in 40 CFR 63.13 of subpart A (General Provisions).

B. What should I consider as I prepare my comments for EPA?

    Do not submit information containing CBI to EPA through http://www.regulations.gov
 or e-mail. Send or deliver information identified

as CBI only to the following address: Roberto Morales, OAQPS Document
Control Officer (C404-02), Office of Air Quality Planning and
Standards, Environmental Protection Agency, Research Triangle Park,
North Carolina 27711, Attention Docket ID EPA-HQ-OAR-2004-0083. Clearly
mark the part or all of the information that you claim to be CBI. For
CBI information in a disk or CD-ROM that you mail to EPA, mark the
outside of the disk or CD-ROM as CBI and then identify electronically
within the disk or CD-ROM the specific information that is claimed as
CBI. In addition to one complete version of the comment that includes
information claimed as CBI, a copy of the comment that does not contain
the information claimed as CBI must be submitted for inclusion in the
public docket. Information so marked will not be disclosed except in
accordance with procedures set forth in 40 CFR part 2.

C. Where can I get a copy of this document?

    In addition to being available in the docket, an electronic copy of
this notice and proposed action will also be available on the Worldwide
Web (WWW) through the Technology Transfer Network (TTN). Following
signature, a copy of this proposed action will be posted on the TTN's
policy and guidance page for newly proposed or promulgated rules at the
following address: http://www.epa.gov/ttn/oarpg/. The TTN provides

information and technology exchange in various areas of air pollution
control.

D. When would a public hearing occur?

    If anyone contacts EPA requesting to speak at a public hearing
concerning the proposed rule by October 1, 2007, we will hold a public
hearing on October 5, 2007. If you are interested in attending the
public hearing, contact Ms. Pamela Garrett at<PHONE_NUMBER> to verify
that a hearing will be held. If a public hearing is held, it will be
held at 10 a.m. at the EPA's Environmental Research Center Auditorium,
Research Triangle Park, NC, or an alternate site nearby.

E. How is this document organized?

    The information in this preamble is organized as follows:

I. General Information
    A. Does this action apply to me?
    B. What should I consider as I prepare my comments to EPA?
    C. Where can I get a copy of this document?
    D. When would a public hearing occur?
    E. How is this document organized?
II. Background Information
    A. What is the statutory authority for the proposed NESHAP?
    B. What criteria did EPA use in developing this proposed NESHAP?
III. Addition and Revision to Source Category Lists
IV. Proposed NESHAP for EAF Steelmaking Facilities
    A. What area source category is affected by the proposed NESHAP?
    B. What are the production processes and emissions sources?
    C. Summary of the Proposed Requirements
    D. What is our rationale for the proposed MACT and GACT
standards?
V. Impacts of the Proposed Standards
VI. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect
Energy Supply, Distribution, or Use
    I. National Technology Transfer Advancement Act
    J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations

II. Background Information

A. What is the statutory authority for the proposed NESHAP?

    Section 112(k)(3)(B) of the CAA requires EPA to identify at least
30 hazardous air pollutants (HAP), which, as the result of emissions of
area sources,\1\ pose the greatest threat to public health in urban
areas. Consistent with this provision, in 1999, in the Integrated Urban
Air Toxics Strategy, EPA identified the 30 HAP that pose the greatest
potential health threat in urban areas, and these HAP are referred to
as the ``Urban HAP.'' See 64 FR 38715, July 19, 1999. Section 112(c)(3)
requires EPA to list sufficient categories or subcategories of area
sources to ensure that area sources representing 90 percent of the
emissions of the 30 Urban HAP are subject to regulation. EPA listed the
source categories that account for 90 percent of the Urban HAP
emissions in the Integrated Urban Air Toxics Strategy.\2\ Sierra Club
sued EPA, alleging a failure to complete standards for the area source
categories listed pursuant to CAA sections 112(c)(3) and (k)(3)(B)
within the time frame specified by the statute. See Sierra Club v.
Johnston, No. 01-1537, (D.D.C.). On March 31, 2006, the court issued an
order requiring EPA to promulgate standards under CAA section 112(d)
for those area source categories listed pursuant to CAA section
112(c)(3).
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    \1\ An area source is a stationary source of hazardous air
pollutant (HAP) emissions that is not a major source. A major source
is a stationary source that emits or has the potential to emit 10
tons per year (tpy) or more of any HAP or 25 tpy or more of any
combination of HAP.
    \2\ Since its publication in the Integrated Urban Air Toxics
Strategy in 1999, EPA has revised the area source category list
several times.
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    We added electric arc furnace (EAF) steelmaking facilities to the
Integrated Urban Air Toxics Strategy Area Source Category List on June
26, 2002 (67 FR 43112). The inclusion of this source category on the
section 112(c)(3) area source category list is based on 1990 emissions
data, as EPA used 1990 as the baseline year for that listing. This
source category was listed as contributing a percentage of the total
area source emissions for the following ``Urban HAP'': arsenic,
cadmium, chromium, lead, manganese, mercury, nickel, and
trichloroethylene. We subsequently discovered that the 1990 emissions
data for trichloroethylene was for a few specialty EAF facilities that
used trichloroethylene in vapor degreasing. These emission units at
both major and area sources are already subject to standards for
halogenated solvent cleaning under 40 CFR part 63, subpart T.
Consequently, we are not proposing any additional standards for
trichloroethylene from EAF steelmaking facilities.
    Section 112(c)(6) requires EPA to list, and subject to standards
pursuant to section 112(d)(2) or (d)(4), categories of sources
accounting for not less than 90 percent of emissions of each of seven
specific HAP: alkylated lead compounds, polycyclic organic matter,
hexachlorobenzene, mercury, polychlorinated biphenyls, 2,3,7,9-
tetrachlorodibenzofurans, and 2,3,7,8-tetrachloridibenzo-p-dioxin.
Congress targeted these HAP for regulation because of their persistence
and tendency to bioaccumulate in the environment. These HAP are also

associated with adverse health effects such as nervous system damage
and reproductive effects. We published an initial list of source
categories under CAA section 112(c)(6) on April 10, 1998 (63 FR 17838).
As discussed below in section III of this preamble, we are adding EAF
steelmaking facilities that are area sources to this list of source
categories under CAA section 112(c)(6) solely on the basis of mercury
emissions.
    During the development of these proposed emissions standards, we
discovered two EAF facilities that are co-located at integrated iron
and steel plants that are major sources, of which we were previously
not aware. We plan to list EAF steelmaking facilities as major sources
under CAA section 112(c) and to develop national emission standards for
hazardous air pollutants (NESHAP) for them based on the performance of
maximum achievable control technology (MACT). However, these two major
sources are not needed to fulfill the CAA section 112(c)(6) requirement
to develop standards for sources accounting for not less than 90
percent of the emissions of mercury so we are not pursuing such action
in this rulemaking given the severe time constraints to which this
rulemaking is subject.

B. What criteria did EPA use in developing this proposed NESHAP?

    We are proposing standards for mercury in response to a court-
ordered deadline that requires promulgation of standards for listed CAA
section 112(c)(6) source categories by December 15, 2007 (Sierra Club
v. Johnson, no. 01-1537, D.D.C). The proposed standards for mercury
emissions from all EAF steelmaking facilities that are area sources of
HAP are consistent with CAA section 112(c)(6).
    The court order in Sierra Club v. Johnson also requires EPA to
issue standards for 10 source categories that EPA listed pursuant to
CAA section 112(c)(3) and (k)(3)(B) by December 15, 2007. In response
to this requirement, we are proposing standards based on generally
available control technology (GACT) for the control of the Urban HAP
arsenic, cadmium, chromium, lead, manganese, and nickel from area
source electric arc furnace steelmaking facilities. The bases for these
standards are described below.
    Under CAA section 112(d)(5), we may elect to promulgate standards
or requirements for area sources ``which provide for the use of
generally available control technologies or management practices by
such sources to reduce emissions of hazardous air pollutants.'' The
alternative is to base standards on performance of MACT under section
112(d)(2) and (3) as described below. Additional information on the
definition of ``generally available control technology or management
practices'' is found in the Senate report on the 1990 amendments to the
CAA (S. Rep. No. 101-228, 101st Cong. 1st sess. 171-172). That report
states that GACT is to encompass:

* * * methods, practices and techniques which are commercially
available and appropriate for application by the sources in the
category considering economic impacts and the technical capabilities
of the firms to operate and maintain the emissions control systems.

Consistent with this legislative history, we can and do consider costs
and economic impacts in determining GACT.
    As provided in CAA section 112(d)(5), EPA is electing to propose
standards under CAA section 112(c)(3) based on GACT for EAF steelmaking
facilities that are area sources. As stated further below (see section
IV.D.3 of this preamble), we do not believe that a choice to base
standards for these area sources on GACT, rather than MACT, requires
justification. However, should justification be required, we are
proposing standards based on GACT rather than on MACT because these
facilities are already well controlled for the metal HAP these sources
emit, and a regulation based on GACT will appropriately allow us to
consider the costs and economic impacts of more stringent regulations.
See the discussion of particulate matter (PM) controls in section
IV.D.4 of this preamble. We believe the consideration of costs and
economic impacts is especially important for EAF area sources because,
given their current well-controlled levels, a MACT floor determination
could result in only marginal reductions in HAP emissions at very high
costs for modest incremental improvement in control. The consideration
of cost is especially important for the small businesses that operate
small specialty and stainless steel EAF facilities.
    We are proposing standards pursuant to CAA section 112(d)(2) for
mercury emissions from all EAF steelmaking facilities that are area
sources of HAP. Standards established under CAA section 112(d)(2) must
reflect performance of MACT. The MACT-based regulation can be based on
the emissions reductions achievable through application of measures,
processes, methods, systems, or techniques including, but not limited
to: (1) Reducing the volume of, or eliminating emissions of, such
pollutants through process changes, substitutions of materials, or
other modifications; (2) enclosing systems or processes to eliminate
emissions; (3) collecting, capturing, or treating such pollutants when
released from a process, stack, storage or fugitive emission point; (4)
design, equipment, work practices, or operational standards as provided
in section 112(h) of the CAA; or (5) a combination of the above.\3\
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    \3\ Section 112(d)(4) (not relevant here) allows alternative
risk-based standards for HAP which are threshold pollutants.
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    The MACT floor is the minimum control level allowed for NESHAP and
is defined under CAA section 112(d)(3). For new sources, MACT standards
cannot be less stringent than the emission control achieved in practice
by the best-controlled similar source, as determined by the
Administrator. The MACT standards for existing sources can be less
stringent than standards for new sources, but they cannot be less
stringent than the average emission limitation achieved by the best
performing 12 percent of existing sources in the category or
subcategory (for which the Administrator has emission information) or
the best performing 5 sources for categories or subcategories with
fewer than 30 sources.
    Although emission standards are often structured in terms of
numerical emissions limits, alternative approaches are sometimes
necessary and are authorized pursuant to CAA section 112(d)(2). For
example, in some cases, physically measuring emissions from a source
may be not practicable due to technological and economic limitations.
Sections 112(d)(2)(D) and 112(h) of the CAA authorize EPA to promulgate
a design, equipment, work practice, or operational standard, or
combination thereof, consistent with the provisions of CAA sections
112(d) or (f), in those cases where it is not feasible to prescribe or
enforce an emission standard. Under CAA section 112(h)(2), the phrase
``not feasible to prescribe or enforce an emission standard'' includes
situations in which the EPA determines that the HAP emissions cannot be
emitted through a conveyance designed and constructed to emit or
capture the emissions or the application of measurement methodology to
a particular class of sources is not practicable due to technological
and economic limitations.
    We are proposing an emissions standard for mercury pursuant to CAA
section 112(d)(2)(A) that is based on pollution prevention measures
which

``reduce the volume of, or eliminate emissions of, such pollutants
through process changes, substitution of materials, or other
modifications.'' We describe below why this standard establishes the
MACT floor for mercury under section 112(d)(3), and further why we are
not proposing beyond-the-floor standards for mercury. We note first,
however, that we do not view standards requiring (or directly based
upon) pollution prevention to be work practices under section 112(h).
This is because the statute specifically differentiates between
emission standards requiring pollution prevention measures (``measures
which reduce the volume of, or eliminate emissions of, such [HAP]
through * * * substitution of materials'') and those requiring work
practices, with only the latter requiring separate justification under
section 112(h). Compare section 112(d)(2)(A) and (D).\4\ This is a
reasonable construction, since there is reason to favor standards
requiring use of pollution prevention measures, which eliminate HAP
emissions altogether, over standards reflecting merely the capture of
some portion of an emitted HAP. There is thus no reason to disfavor
pollution prevention-based standards by allowing their use only if the
section 112(h) criteria are also satisfied.
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    \4\ Such a standard is an ``emission standard'' since it
``limits the quantity * * * of emissions of air pollutants on a
continuous basis''. See section 302(k)(definition of ``emission
standard'').
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    However, even assuming, for the sake of argument, that the proposed
pollution prevention standards for mercury are considered to be work
practices, it is not feasible to prescribe or enforce an emissions
limit for mercury, within the meaning of section 112(h). We believe
that continuous emission monitoring systems (CEMS) for mercury
concentration and volumetric flow rate would be needed for EAF, because
EAF steelmaking is a batch process, and mercury emissions vary
enormously from batch to batch as different scrap sources are
processed. Indeed, emissions have been shown to vary by two orders of
magnitude at a single plant.\5\ Cf. Mossville Environmental Action Now
v. EPA, 370 F. 3d 1232, 1240 (D.C. Cir. 2004) (noting that EPA
reasonably declined to establish MACT floor levels based on single
emission level measurements from batch process operations because of
constant change in those levels).
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    \5\ See ``Analysis of Mercury Emissions Test Data'' in Docket ID
No. EPA-HQ-OAR-2004-0083.
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    We therefore examined the technological and economic feasibility of
continuous monitoring for mercury from these sources. We note first
that mercury CEMS are not demonstrated for EAF, raising a threshold
question of their technical feasibility for all EAF. Furthermore, most
EAF discharge emissions from positive pressure baghouses without
stacks. Continuous mercury monitoring would not be technically feasible
for these EAF (i.e., stackless EAF), even assuming that mercury CEMS
were otherwise demonstrated for EAF. This is because volumetric flow
rate and concentration would need to be determined by CEMS to measure
the mass emission rate of mercury, and without a stack, it is nearly
impossible to obtain an accurate measurement of volumetric flow rate or
to obtain representative measurements of mercury concentration in the
discharged emissions. Indeed, EPA has previously determined that the
use of continuous opacity monitoring systems (COMS) was not feasible
for positive pressure baghouses without stacks for this
reason.6, 7
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    \6\ For example, EPA estimated that 70 of 130 electric arc
furnaces (EAF) subject to the new source performance standard (NSPS)
were not required to install continuous opacity monitors because of
the configuration of their baghouse. (See the EPA fact sheet for the
NSPS amendments available at http://www.epa.gov/ttn/oarpg/t1/fact_sheets/eaf_npsfs.pdf
).

    \7\ Retrofitting such sources with stacks would be extremely
costly for most electric arc furnaces (EAFs) to the point that it
would not be economically practicable to do so. See ``Estimated
Impacts of Proposed Area Source Standard for EAF'' in EPA Docket ID
No. EPA-HQ-OAR-2004-0083. EPA believes that one takes a source as
one finds it for purposes of applying section 112(h), and therefore
that it is simply not technologically practicable to apply
continuous mercury monitoring technology to a stackless EAF.
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    Some EAF do have stacks, and the limited amount of mercury
emissions data from EAF which EPA has comes from such sources. These
limited test data were collected using manual test methods and are
therefore not reliable for determining an EAF's actual performance
because these short-term test results are not representative of the
long-term operation of a cyclic batch process. The results of the
different manual tests (typically 1-hour runs) show a variability of
over two orders of magnitude within a single source (as well as across
sources) and reinforce the conclusion that continuous monitoring would
be needed to prescribe and enforce a numerical emissions limit for
mercury.\8\ As noted, CEMS are not demonstrated for these sources. For
these reasons, we do not believe it technologically practicable to
apply continuous measurement methodology to even EAFs with stacks.
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    \8\ See ``Analysis of Mercury Emissions Test Data'' in EPA
Docket ID No. EPA-HQ-OAR-2004-0083.
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    We also examined the possibility of setting a direct limit on the
amount of mercury entering the EAF and thus limiting emissions.\9\
However, the scrap charged to EAF includes many shapes and sizes,
bundles, discrete pieces, and various sizes of shredded metal.
Accordingly, there is no way to obtain representative samples for
analysis of mercury content to develop or enforce a mercury limit for
the scrap. The number of mercury switches in the scrap (the predominant
source of mercury in the scrap, and hence to an EAF) also cannot be
determined for the same reasons. In addition, the switches would not be
recognizable after scrap dealers have crushed and shredded incoming
scrap. Consequently, we propose that it is not feasible or practicable
to establish a limit for mercury in the scrap.
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    \9\ However, as explained in section IV.D.1 of this preamble,
the standard we are proposing effectively establishes such a limit.
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    The pollution prevention approach which is the basis for the
proposed MACT standard for mercury is discussed below in section IV.D.1
of this preamble.

III. Addition and Revision to Source Category Lists

    Section 112(c)(6) of the CAA requires us to list categories and
subcategories of sources accounting for not less than 90 percent of the
aggregate emissions of each of seven specific HAP. Since the
publication of the original 1998 CAA section 112(c)(6) source category
list, we have collected additional data on mercury emissions in 1990
and performed another review of information on the 1990 baseline
emissions inventory that served as the basis for the listing. In re-
evaluating the baseline inventory, we have determined that EAF
steelmaking facilities emit mercury and contributed to the 90 percent
of the aggregate emissions of mercury in 1990, and we have updated our
estimates of the 1990 baseline year to reflect this contribution of
mercury from EAF.\10\ Consequently, we are adding EAF steelmaking
facilities to the list of source categories under CAA section 112(c)(6)
on the basis of mercury emissions.
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    \10\ Additional information on the ``1990 Emissions Inventory of
Section 112(c)(6) Pollutants'' is available at http://www.epa.gov/ttn/atw/112c6/112c6pg.html
.

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    This notice also announces a revision to the area source category
list developed under our Integrated Urban Air Toxics Strategy pursuant
to CAA section 112(c)(3). The revision changes the name of the listed
area source category, ``Stainless and Nonstainless Steel Manufacturing
Electric Arc

Furnaces (EAF)'' to ``Electric Arc Furnace Steelmaking Facilities.'' We
are making this revision to clarify that the source category includes
all types of steel made in EAF, such as stainless steel, carbon steel,
specialty steel, and other grades and alloys of steel. This is simply a
change in the name of the source category and does not change the
universe of sources that were the basis of the original listing notice.

IV. Proposed NESHAP for EAF Steelmaking Facilities

A. What area source category is affected by the proposed NESHAP?

    The EAF steelmaking area source category consists of facilities
engaged in the production of steel using EAF to melt primarily ferrous
scrap to produce molten steel. The molten steel is refined by ladle
metallurgy processing and subsequently cast into basic steel shapes
that are further processed in rolling mills.
    The U.S. steel industry produced about 106 million tons of raw
steel in 2006, and approximately 93 ``minimills'' that melt ferrous
scrap in EAF accounted for 57 percent of the total U.S. production.
Critically, for purposes of the mercury standard proposed in this rule,
the EAF at minimills produce steel by melting recycled ferrous scrap.
The reason this is critical is that the mercury emitted by EAF comes
almost exclusively from automotive scrap, and approximately 50 to 80
percent of this mercury can be eliminated from the scrap feed by
pollution prevention measures carried out upstream of the EAF.
    The production of steel in minimills has increased dramatically
over the past 30 years. Minimills accounted for 10 percent of the
national steel production in 1970, 30 to 40 percent in the 1980s, 40 to
50 percent in the 1990s, and (as noted) 57 percent in 2006. The growth
has been attributed in part to an expansion in the types and quality of
steel products that minimills can produce, including heavy structurals,
rail, plate, specialty bar, hot rolled, cold rolled, galvanized, and
stainless flat rolled products.
    Most of the steel produced in EAF is carbon steel used in the
manufacture of construction materials, automobiles, appliances, and
other applications. Approximately 4 percent (about 2 million tons) is
specialty and stainless steel, which are high value steel products. The
types of steel are defined by their composition of alloying elements.
Stainless and alloy steels contain less carbon and zinc and more
chromium, manganese, and nickel than carbon steels. Some stainless
steel grades contain 12 to 28 percent chromium and 4 to 25 percent
nickel.
    U.S. minimills are the largest recyclers of metal scrap in the
world. Recycled iron and steel scrap nationwide in 2004 included 25
percent ``home scrap'' (from current operations at the plant), 26
percent ``prompt scrap'' (from plants manufacturing steel products),
and 49 percent post-consumer scrap. The primary source of post-consumer
scrap is the automobile, and in 2004, the steel industry recycled 14.2
million tons of iron and steel scrap from 14 million vehicles.

B. What are the production processes and emissions sources?

    Most EAF are equipped with three carbon electrodes that are raised
or lowered through the furnace roof. When the electrodes are retracted,
the furnace roof can be rotated to allow the charge of scrap steel by
an overhead crane. Electric current that is passed between the
electrodes and through the scrap generates heat to melt the scrap. The
stages of each production cycle include charging (loading scrap and
other raw materials into the furnace), melting, removing slag (a layer
of impurities that forms on top of the molten steel), and tapping
(pouring molten steel into a ladle). Operating cycles in this batch
process range from 35 to more than 200 minutes; the longer cycle times
are generally used when producing stainless and specialty steels. After
tapping, the steel is transferred to the ladle metallurgy facility
where it undergoes additional refining in a ladle to produce the
desired final properties. After the composition and temperature are
adjusted in the ladle metallurgy facility, the molten steel is
transferred to the continuous caster, which forms the steel into semi-
finished shapes. The steel shapes are then processed in rolling mills
to produce the final steel product.
    Emissions from the EAF occur during charging, melting, and tapping.
Emissions may also occur when the molten steel is processed at the
ladle metallurgy facility. The type and volume of emissions of HAP
metals are affected by the quantity and type of HAP metals in the
ferrous scrap being melted and the addition of certain alloys (e.g.,
chromium, manganese, and nickel). Some HAP metals, such as manganese,
are an inherent and necessary component of ferrous scrap and the final
steel product. Other HAP metals, such as mercury, arsenic, and cadmium,
are undesirable elements introduced with the ferrous scrap. Other HAP
metals, such as chromium and nickel, are introduced as alloying
elements and are necessary to produce stainless and specialty steels.
    Capture systems for emissions from EAF typically include direct-
shell evacuation control (DEC) systems; canopy hoods, side draft hoods,
and tapping hoods; partial or total enclosures; scavenger duct systems;
and building evacuation systems. The most common types of capture
systems for ladle metallurgy are canopy hoods, side draft hoods, and
close fitting hoods. Nearly all plants duct process and fugitive
emissions to a baghouse. These capture systems and PM control devices
are highly efficient for the capture and control of PM and HAP metals
that are in particulate form, including the Urban HAP arsenic, cadmium,
chromium, lead, manganese, and nickel. However, mercury emitted from
the EAF is in vapor form and is not controlled by the PM control
devices.
    A detailed survey of 27 plants showed that EAF steelmaking
facilities use scrap specifications, scrap management plans, and
inspections to ensure that charge materials do not adversely affect the
quality of steel or create dangerous operating conditions. Common
requirements include testing for radiation; rejecting scrap containing
sealed containers, hazardous materials, or explosives; and prohibiting
materials such as lead, copper, oil, grease, batteries, and
refrigerants. Most plants also require some type of visual inspection
of incoming scrap. These scrap management procedures also serve to
reduce HAP emissions by preventing HAP materials and precursors from
entering the EAF and subsequently being emitted.

C. Summary of the Proposed Requirements

    This section presents a summary of the requirements of the proposed
rule. Additional details and the rationale for the proposed
requirements are provided in the following section IV.D of this
preamble.
1. Applicability and Compliance Dates
    The proposed NESHAP applies to each new or existing EAF steelmaking
facility that is an area source of HAP. We are proposing that the owner
or operator of an existing area source that does not have to install or
modify emissions control equipment to meet the opacity limit for
fugitive emissions comply with all applicable rule requirements no
later than six months after the date of publication of the final rule
in the Federal Register. We are proposing that the owner or operator of
an existing area source that must install

or modify emission control equipment to meet the opacity limit for
fugitive emissions may request a compliance date for the opacity limit
that is no later than two years after the date of publication of the
final rule in the Federal Register based on a demonstration to the
satisfaction of the permitting authority that the additional time is
needed. The owner or operator of a new affected source would be
required to comply with all applicable rule requirements by the date of
publication of the final rule in the Federal Register (if the startup
date is on or before promulgation) or upon startup (if the startup date
is after promulgation).
2. Proposed MACT Standards for the Control of Mercury
    The proposed standards for mercury are based on pollution
prevention and require an EAF owner or operator who melts scrap from
motor vehicles either to purchase (or otherwise obtain) the motor
vehicle scrap only from scrap providers participating in an EPA-
approved program for the removal of mercury switches or to fulfill the
alternative requirements described below. EAF facilities participating
in an approved program must maintain records identifying each scrap
provider and documenting the scrap provider's participation in the EPA-
approved mercury switch removal program. A proposed compliance option
is for the EAF facility to prepare and operate pursuant to an EPA-
approved site-specific plan that includes specifications to the scrap
provider that mercury switches must be removed from motor vehicle
bodies at an efficiency comparable to that of the EPA-approved mercury
switch removal program (see below). An equivalent compliance option is
provided for facilities that do not utilize motor vehicle scrap that
contains mercury switches.
    We expect most facilities that use motor vehicle scrap will choose
to comply by purchasing motor vehicle scrap only from scrap providers
who participate in a program for removal of mercury switches that has
been approved by the Administrator. The National Vehicle Mercury Switch
Recovery Program (NVMSRP) \11\ would be an approved program under this
proposed standard. Facilities choosing to use the NVMSRP as a
compliance option would have to assume all of the responsibilities for
steelmakers as described in the Memorandum of Understanding. The NVMSRP
is described in detail in section IV.D.1 of this preamble.
---------------------------------------------------------------------------

    \11\ Additional details can be found at http://www.epa.gov/mercury/switch.htm
 and in section IV.D.1 of this preamble. In

particular, see the signed Memorandum of Understanding.
---------------------------------------------------------------------------

    EAF facilities could also obtain scrap from scrap providers
participating in other programs. To do so, the facility owner or
operator would have to submit a request to the Administrator for
approval to comply by purchasing scrap from scrap providers that are
participating in another switch removal program and demonstrate to the
Administrator's satisfaction that the program meets the following
specified criteria: (1) There is an outreach program that informs
automobile dismantlers of the need for removal of mercury switches and
provides training and guidance on switch removal, (2) the program has a
goal for the removal of at least 80 percent of the mercury switches,
and (3) the program sponsor must submit annual progress reports on the
number of switches removed and the estimated number of motor vehicle
bodies processed (from which a percentage of switches removed is easily
derivable).
    EAF facilities that purchase motor vehicle scrap from scrap
providers that do not participate in an EPA-approved mercury switch
removal program would have to prepare and operate pursuant to and in
conformance with a site-specific plan for the removal of mercury
switches. The facility's scrap specifications would have to include a
requirement for the removal of mercury switches, and the plan must
include provisions for obtaining assurance from scrap providers that
mercury switches have been removed. The plan would be submitted to the
Administrator for approval and would demonstrate how the facility will
comply with specific requirements that include: (1) A means of
communicating to scrap purchasers and scrap providers the need to
obtain or provide motor vehicle scrap from which mercury switches have
been removed and the need to ensure the proper disposal of the mercury
switches, (2) provisions for obtaining assurance from scrap providers
that motor vehicle scrap provided to the facility meets the scrap
specifications, (3) provisions for periodic inspection, site visits, or
other means of corroboration to ensure that scrap providers and
dismantlers are implementing appropriate steps to minimize the presence
of mercury switches in motor vehicle scrap, (4) provisions for taking
corrective actions if needed, and (5) requiring each motor vehicle
scrap provider to provide an estimate of the number of mercury switches
removed from motor vehicle scrap sent to the facility during the
previous year and the basis for the estimate. The Administrator would
be able to request documentation or additional information from the
owner or operator at any time. The site-specific plan must establish a
goal for the removal of at least 80 percent of the mercury switches.
All documented and verifiable mercury-containing components removed
from motor vehicle scrap would count towards the 80 percent goal.
    An equivalent compliance option would be provided for EAF
steelmakers who do not utilize motor vehicle scrap that contains
mercury. The option would require the facility to certify that the only
materials they are charging from motor vehicle scrap are materials
recovered for their specialty alloy, such as chromium in certain
exhaust systems. Such materials are known not to contain mercury, and
because the specialty steels must meet stringent product quality and
performance specifications, automobile scrap with contaminants such as
mercury, lead, zinc, and copper is not accepted.\12\
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    \12\ Letter from Joseph Green, Counsel to the Specialty Steel
Industry of North America, to Steve Fruh, Environmental Protection
Agency. Information Regarding Specialty Steel Industry Segment. July
30, 2004.
---------------------------------------------------------------------------

3. Proposed GACT Standards for EAF and Ladle Metallurgy Operations
    We propose that the owner or operator would be required to install,
operate, and maintain capture systems for EAF and ladle metallurgy
operations that convey the collected gases and fumes to a venturi
scrubber or baghouse for the removal of PM. We are proposing separate
emissions limits for new and existing EAF steelmaking facilities that
produce less than 150,000 tpy of stainless or specialty steel, and for
larger, non-specialty EAF steelmaking facilities. The small facilities
would be required to comply with a PM emissions limit of 0.8 pounds of
PM per ton (lb/ton) of steel for each control device serving an EAF or
ladle metallurgy operation and an opacity limit of 6 percent for melt
shop emissions. All other EAF steelmaking facilities (both existing and
new) would be required to meet a PM limit of 0.0052 grains per dry
standard cubic foot (gr/dscf) for emissions from a control device for
an EAF or ladle metallurgy operation. The opacity of emissions from
melt shops from these sources would be limited to 6 percent.
    Performance tests would be required for each emissions source to
demonstrate initial compliance with the

PM and opacity limits. Provisions are included in the proposed rule for
conducting the tests. The owner or operator of an existing EAF
steelmaking facility would be allowed to certify initial compliance
with the emissions limits if a previous test was conducted during the
past 5 years using the methods and procedures in the rule and either no
process changes have been made since the test, or the owner or operator
can demonstrate that the test results, with or without adjustments,
reliably demonstrate compliance despite process changes.
    All EAF steelmaking facilities would be required to obtain a title
V permit. The proposed rule would require each EAF steelmaking facility
to monitor the capture system, PM control device, and melt shop;
maintain records; and submit reports according to the compliance
assurance monitoring (CAM) requirements in 40 CFR part 64. The existing
part 64 rule requires the owner or operator to establish appropriate
ranges for selected indicators for each emissions unit (i.e., operating
limits) such that operation within the ranges will provide a reasonable
assurance of compliance with the emissions limitations or standards.
    The CAM rule requires the owner or operator to submit certain
monitoring information to the permitting authority for approval. This
information includes: (1) The indicators to be monitored; (2) the
ranges or designated conditions for such indicators, or the process by
which such indicator ranges or designated conditions will be
established; (3) performance criteria for the monitoring; and if
applicable, (4) the indicator ranges and performance criteria for a
CEMS, COMS, or predictive emissions monitoring system. The owner or
operator also must submit a justification for the proposed elements of
the monitoring control device (and process and capture system, if
applicable) and operating parameter data obtained during the conduct of
the applicable compliance or performance test.
    If monitoring indicates that the unit is operating outside of the
acceptable range established in its permit, the owner or operator must
return the operation to within the established range consistent with 40
CFR 64.7(d).
4. Proposed GACT Standards for Scrap Management
    In addition to meeting PM and opacity limits reflecting GACT, we
are also proposing that EAF facilities be required to restrict the use
of certain scrap or follow a pollution prevention plan for scrap
inspection and selection that minimizes the amount of specific
contaminants in the scrap.
    The proposed requirements are based on two pollution prevention
approaches depending on the type of scrap that is used, and a facility
may have some scrap subject to one approach and other scrap subject to
the other approach. One provision is for scrap that does not contain
certain contaminants and would simply prohibit the processing of scrap
containing these contaminants (restricted scrap). Compliance would be
demonstrated by a certification that the owner or operator will not
process scrap with the contaminants. This scrap management approach is
expected to be most useful to stainless and specialty steel producers
with stringent scrap specifications that do not permit the use of motor
vehicle scrap and scrap containing free organic liquids. The other
approach for scrap that may contain certain contaminants is more
prescriptive and requires a pollution prevention plan, scrap
specifications, and procedures for determining that these requirements
are met. This pollution prevention approach was developed primarily for
carbon steel producers that accept motor vehicle scrap and many other
types of ferrous scrap.
    Under the restricted scrap provision, the plant owner or operator
would agree to restrict the use of certain scrap, including metallic
scrap from motor vehicle bodies, engine blocks, oil filters, oily
turnings, machine shop borings, transformers and capacitors containing
polychlorinated biphenyls (PCBs), lead-containing components,
chlorinated plastics, or free organic liquids. The restriction on lead-
containing components would not apply to the production of leaded steel
(where lead is obviously needed for production).
    The other proposed scrap management provision would require the
plant owner or operator to prepare a pollution prevention plan for
metallic scrap selection and inspection to minimize the amount of
chlorinated plastics, lead (except for the production of leaded steel),
and free organic liquids. This plan would be submitted to the
Administrator for approval. The owner or operator would be required to
keep a copy of the plan onsite and train plant personnel with materials
acquisition or inspection duties in the plan's requirements.
    The plan would include specifications for scrap materials to be
depleted (to the extent practicable) of lead-containing components
(except for the production of leaded steel), undrained used oil
filters, chlorinated plastics, and free organic liquids. The plan would
also contain procedures for determining if these requirements are met
(e.g., visual inspection or periodic audits of scrap suppliers) and
procedures for taking corrective actions with vendors whose shipments
are not within specifications.
5. Proposed Requirements for Recordkeeping and Reporting
    Area sources subject to the proposed requirements for EAF and ladle
metallurgy operations would be subject to the recordkeeping and
reporting requirements of the part 64 CAM rule. The general
recordkeeping requirements of the part 64 rule directs the owner or
operator to comply with the recordkeeping requirements for title V
operating permits in 40 CFR 70.6(a)(3)(ii), which require records of
analyses, measurements, and sampling data. The part 64 rule also
requires the owner or operator to maintain records of monitoring data,
monitor performance data, corrective actions taken, any written quality
improvement plan (QIP), any activities undertaken to implement a QIP,
and other supporting information required by the part 64 rule (such as
data used to document the adequacy of monitoring, or records of
monitoring maintenance or corrective actions).
    The general reporting requirements of part 64 require the owner or
operator to submit monitoring reports to the permitting authority in
accordance with the requirements for facilities with title V operating
permits. The title V reporting requirements in 40 CFR 70.6(c)(1) and 40
CFR 71.6(c)(1) include a 6-month monitoring report, deviation reports,
and annual compliance certifications. The reporting requirements under
part 64 requires that the 6-month monitoring report include: (1)
Summary information on the number, duration and cause (including
unknown cause, if applicable) of excursions or exceedances, as
applicable, and the corrective actions taken; (2) summary information
on the number, duration and cause (including unknown cause, if
applicable) for monitor downtime incidents (other than downtime
associated with zero and span or other daily calibration checks, if
applicable); and (3) a description of the actions taken to implement a
QIP during the reporting period. Upon completion of a QIP, the owner or
operator must include in the next summary report documentation that the
implementation of the plan has been completed and reduced the
likelihood of similar levels of excursions or exceedances occurring.
    All EAF steelmaking facilities subject to this proposed NESHAP
would also be subject to certain specified requirements

of the NESHAP general provisions (40 CFR part 63, subpart A). The
general provisions include requirements for initial notifications;
startup, shutdown, and malfunction records and reports; recordkeeping;
and semiannual excess emissions and monitoring system performance
reports. The information required in these records and reports is
similar to the information required by the CAM rule (40 CFR part 64)
and the operating permits rules (40 CFR parts 70 and 71).
    The proposed NESHAP also includes specific recordkeeping and
reporting requirements for area source facilities subject to
requirements for control of contaminants from scrap. The area source
facilities would be required to keep records to demonstrate compliance
with the requirements for their pollution prevention plan for
minimizing the amount of chlorinated plastics, lead, and free organic
liquids charged to a furnace or for the use of only restricted scrap
and the site-specific plan for mercury or any of the mercury compliance
options.
    As noted above, facilities subject to the site-specific plan for
mercury would be required to keep records and submit semiannual reports
on the number of mercury switches removed by the scrap provider or the
weight of mercury recovered from those switches, an estimate of the
percent of mercury switches recovered, and certification that the
recovered mercury switches were managed at RCRA-permitted facilities.
In contrast, facilities participating in an EPA-approved program for
switch removal must keep records that identify their scrap providers
and document that they participate in an approved switch removal
program. As discussed in more detail in section IV.D.1 of this
preamble, we are proposing to require more extensive records for a
site-specific plan than for an approved program because extensive
recordkeeping, reporting, and measurement of success are already
required for approval of such a removal program, the NVMSRP being the
prime example.
    All facilities subject to the requirements for the control of
contaminants from scrap would be required to submit semiannual reports
according to the requirements in Sec.  63.10(e) of the general
provisions. The report would identify any deviation from the rule
requirements and the corrective action taken.

D. What is our rationale for the proposed MACT and GACT standards?

1. Proposed MACT Standard for Mercury
    Background. Mercury enters the EAF steelmaking process almost
exclusively with the ferrous scrap that is charged to the furnace. A
few other materials are charged to the EAF in small quantities (e.g.,
coke, coal, lime); however, they contribute little mercury because they
are used in very small quantities relative to the scrap charge and
contain virtually no mercury in any case. The major source of mercury
in ferrous scrap is convenience light switches in end-of-life vehicles
that contain 0.8 grams (g) to 1.2 g of mercury per switch. These
switches (called mercury switches or tilt switches) control lights
under the hoods and in the trunks of older model vehicles. The Ecology
Center estimated that the vehicles retired in 2003 contained 8.5
million switches and 9.3 tons of mercury. Pilot studies in New Jersey
and Michigan reported 0.54 to 0.8 mercury switches per vehicle
processed. For 14 million vehicles recycled in 2004, the number of
switches thus would be in the range of 7.6 to 11 million. Although
mercury switches were phased out of automobiles in 2002, there is a 10
to 15 year supply of existing vehicles destined for recycling that
still contain the switches. There are other components in automobile
scrap which contain small amounts of mercury, such as anti-lock braking
sensors, security systems, and active ride control systems. However,
most of the mercury is contributed by convenience light switches, which
are estimated to be the source of 87 percent of the mercury in motor
vehicle scrap by the Ecology Center.\13\
---------------------------------------------------------------------------

    \13\ The Ecology Center report and other information cited for
mercury switches is available in EPA Docket ID No. EPA-HQ-OAR-2004-
0083.
---------------------------------------------------------------------------

    We have very limited data on the mercury species emitted from EAFs;
however, the limited data indicate that over 99 percent of the mercury
emissions are in the gaseous form, and about 93 percent of the gaseous
mercury is elemental mercury. Although baghouses are highly efficient
at removing HAP metals that are in the particulate phase, the baghouses
do not control gaseous or vapor phase mercury and thus (for practical
purposes) do not control mercury emissions from EAFs. No EAFs use add-
on controls for gaseous mercury emissions.
    The limited test data show extreme variability (orders of
magnitude) in mercury emissions from plant to plant and from the same
plant over time as different batches of scrap are melted. The limited
sampling results of input materials likewise indicate that the mercury
content of scrap typically varies widely.\14\
---------------------------------------------------------------------------

    \14\ See ``Analysis of Mercury Emissions Test Data'' in Docket
ID No. EPA-HQ-OAR-2004-0083.
---------------------------------------------------------------------------

    We also examined scrap specifications that may be in use to reduce
mercury emissions. Three companies reported in their survey responses
that their scrap specifications prohibited mercury-containing
components. However, there was no measure of effectiveness of the
written specification.
    Over the past few years, there has been an increasing awareness
that a highly effective way of reducing mercury releases to the
environment from scrap using entities like EAFs is to remove mercury
switches from end-of-life vehicles prior to crushing, shredding, and
melting. Numerous interested parties have been involved at the local,
State, and national level in the development and implementation of
switch removal programs, including local and State environmental
agencies, national and local environmental groups, steel recyclers,
steel producers, automobile makers, various EPA offices, and others.
Many successful State and local switch removal programs are already in
place, and more are expected in the future.
    Several State programs for mercury switch removal have been
implemented, and there are many different variations. Some programs are
mandated by law, and others are voluntary. Some offer financial
incentives provided by different stakeholders, some specify financial
incentives to be provided by automobile makers, and some have no
financial incentives. Some have a strict accounting of switches removed
and requirements for proper collection, management, and disposal of the
switches.
    There have been direct measurements of the mercury emission
reductions that can be achieved at minimills by switch removal
programs. For example, a pilot program administered by the New Jersey
Department of Environmental Protection reported a reduction of 50
percent in mercury emissions when the EAF melted scrap that had been
processed in a switch removal program.\15\ We also identified one
minimill in Minnesota that had implemented a mercury switch removal
program that included removal prior to processing in their on-site
shredder and a system for paying other

scrap suppliers to remove switches. This program has resulted in a
quantifiable reduction in environmental releases of mercury. These two
studies confirm that a national mercury switch removal program for end-
of-life vehicles will reduce mercury emissions.
---------------------------------------------------------------------------

    \15\ ``Mercury Switch Data Collection Pilot Project.'' Prepared
by K.L. Woodruff. New Jersey Department of Environmental Protection.
March 24, 2004.
---------------------------------------------------------------------------

    Switch removal programs reduce mercury releases to all media.
Switch removal reduces mercury releases to air, water, and land when
automobiles are crushed and shredded prior to delivery to the
minimills. Mercury contamination of auto shred residue (plastics,
fabrics, and other unwanted materials in the automobile) is reduced
making safer the further management of the material. The switches
themselves are isolated and managed in RCRA subtitle C hazardous waste
management facilities where they are subject to stringent regulatory
control. As a result of the mercury switch removal programs, mercury
emissions are reduced at all facilities which use the scrap as raw
material, including not only EAFs but integrated iron and steel plants
and iron and steel foundries. Finally, mercury emissions are reduced
from scrap that is exported and melted in furnaces in other countries.
    The National Vehicle Mercury Switch Recovery Program (NVMSRP).\16\
A significant step forward in reducing mercury emissions was made on
August 11, 2006 when a Memorandum of Understanding (MOU) was signed by
representatives of the steel industry, automobile makers, scrap
recyclers, environmental groups, State and local agencies, and EPA.\17\
The MOU established the NVMSRP, and this program has been implemented
and is already removing and recovering mercury switches from end-of-
life vehicles before the metallic scrap is recycled at EAFs (and other
steel-producing entities).
---------------------------------------------------------------------------

    \16\ This section describes the national switch recovery program
in detail. As discussed in the following sections of this preamble,
the proposed rule does not codify these details as part of the
proposed standard for mercury emissions. The proposed rule requires
the owner or operator to: (1) Certify they are participants in the
national program and that scrap is purchased only from scrap
providers participating in such a national program, (2) maintain
records documenting such participation, and (3) submit semiannual
reports if there are any deviations from the requirements. However,
the proposed rule also allows an owner or operator to comply with
the proposed rule if they can demonstrate that they are
participating in a program that is equivalent to the national
program and is of demonstrably equal effectiveness.
    \17\ Additional details and the signed Memorandum of
Understanding can be found at http://www.epa.gov/mercury/switch.htm.

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

    The NVMSRP is the result of a two-year collaborative effort
involving EPA, the End of Life Vehicle Solutions Corporation
(ELVS),\18\ the American Iron and Steel Institute, the Steel
Manufacturers Association, the Institute of Scrap Recycling Industries,
the Automotive Recyclers Association, Environmental Defense, the
Ecology Center (Ann Arbor), and representatives of the Environmental
Council of the States. The goal of the NVMSRP is to significantly
reduce air emissions of mercury from steelmaking facilities that
utilize auto shred by substantially reducing the number of mercury-
containing switches in scrap automobiles before they are crushed and
shredded for recycling. This is being accomplished through education
and outreach for those removing switches; removal, collection and
management of switches; transport of the switches to a qualified
retorter that has the permits that allow for managing the switches
under RCRA subtitle C; recordkeeping and accountability of mercury
recovery; scrap selection and corroboration; and review and improvement
of the NVMSRP. The vehicle manufacturers and steelmakers have created a
three-year, $4 million dollar implementation fund in support of the
program. The fund will support the implementation of the NMSRP through
incentive payments to those entities recovering (i.e. pulling) the
switches. Performance will be assessed on a regular basis by all of the
participating parties.
---------------------------------------------------------------------------

    \18\ ELVS is a non-profit corporation established by several
motor vehicle manufacturers who are listed at http://www.elvsolutions.org/about.htm
.

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

    Finally, the MOU contains a provision providing that the agreement
may terminate with the consent of the parties based on the phase out of
automobiles containing mercury switches. A potential termination date
mentioned in the MOU is December 31, 2017, a date when it is projected
that 90 percent of vehicles containing mercury switches will be
retired.\19\ EPA believes that any issues raised by this potential
``sunset'' provision are best addressed when EPA reexamines the MACT
standard pursuant to section 112(d)(6) (which must occur no later than
2015). At that time, there will be robust information available as to
switch removal rates and rate of fleet retirement.
---------------------------------------------------------------------------

    \19\ The MOU states ``The NVMSRP will be implemented until
December 31, 2017 based on estimates that 90% of the vehicles
containing mercury switches would be retired by that time. If,
before that date, based on Program data and other information, the
Parties or their designees determine that the number of remaining
Mercury Switches no longer constitutes a significant source of
mercury, they may determine that the program should end. In such a
case, the Parties may terminate this MOU through written notice to
all signatories and Participants. If the Parties or their designees
determine that the number of mercury switches is still significant
after that date, they may extend the Program. If the Program is
extended, the Parties and U.S. EPA may continue this MOU through
written mutual consent of all parties and U.S. EPA.''
---------------------------------------------------------------------------

    The NVMSRP was designed to harmonize with existing State programs
and to be implemented State-by-State by the participants, in
consultation with appropriate State agencies, in the remaining States
to form a coordinated national program. The NVMSRP has shown success in
just a few months following the MOU. As of July 9, 2007, programs were
operational in 45 States, and 5,633 participants have collected more
than 575,841 mercury switches with 1,267 pounds of mercury. Programs
are expected to be implemented in all of the remaining States in 2007.
    Proposed MACT floor determination. More than 12 percent of the EAF
steelmaking facilities are participants in this national program and
have been participants in previous State and local programs. We believe
that these operations pursuant to the national program represent the
best performers and best performance for mercury--the chief source of
mercury in emissions is being removed from feedstock--so that the MACT
floor for new and existing EAF steelmaking facilities is for the owner
or operator to operate pursuant to such a program; i.e., to obtain
scrap only from scrap providers that are first removing mercury
switches pursuant to the national program or an equivalent program of
demonstrably equal effectiveness.\20\ We are also proposing that a
switch removal program is the MACT floor for new sources because the
best-controlled similar source is among those that prevent mercury
switches from entering with the scrap.
---------------------------------------------------------------------------

    \20\ We estimate that the mercury switch removal program will
reduce mercury emissions to below 90 mg Hg/ton of steel produced
(based on two State pilot program studies showing approximately 50
percent reduction from switch removal and average baseline mercury
emissions of 180 mg Hg/ton), which results in an estimated reduction
of 5 tpy of mercury. For perspective, 90 mg/ton of steel corresponds
to a trace mercury level of 0.1 ppm in the steel scrap or the
equivalent of about one mercury switch (one gram or 1,000 mg of
mercury) per 10 tons of steel scrap (about one switch per ten end-
of-life vehicles at one ton of steel per vehicle). In contrast, we
estimate that the MACT floor based on our limited mercury emissions
test data, which comes from a time when switch removal agreements
were not in place, would be 650 mg Hg/ton of steel. Additional
details are provided in ``Analysis of Mercury Emissions Test Data''
in Docket ID No. EPA-HQ-OAR-2004-0083.
---------------------------------------------------------------------------

    We examined the features of the NVMSRP and other switch removal
programs to identify those features that would be the necessary
components of a national emission standard to ensure that the program
would be effective at reducing mercury emissions. These features
include assurance that each

facility is participating in a switch removal program that has been
approved by the Administrator, a program goal for the percent of
switches removed (80 percent), a system that accounts for the number of
switches (or quantity of mercury) removed and the number of vehicle
bodies processed, a mechanism to ensure the switches are properly
disposed of or recycled, and an outreach program that informs
dismantlers of the need for removal of mercury switches and provides
training and guidance for removal. The national program has these
features, and we are proposing that these features represent the MACT
floor for mercury for new and existing sources because this is the
mercury control approach that is being used by the best-performing
sources.
    The national program also has a mechanism to measure performance
because the number of switches and amount of mercury recovered is
reported by State, and from an estimate of the number of vehicles
processed, the progress toward the goal of 80 percent removal can be
determined. The MOU also includes ongoing measures to track and measure
progress. For example, the parties will assess development and
implementation of State plans and identification and participation of
program participants at three-month intervals for the first year
following the effective date of the MOU. At six-month intervals
thereafter, the parties will collectively review by State the status of
implementation and participation in the program and make adjustments as
necessary. The indicators to be reviewed will include the status of
plans for 50-State implementation, number of States where the program
has been initiated, the status of Web-based information on the NVMSRP,
the status of identification of dismantlers and dismantler
participation in all States (starting with those States targeted for
initial implementation), and the status of the mercury recovery
database and rate of information collection.
    The parties to the MOU expect that in the first three years of the
program, capture rates will be ramping up due to the realities of
program implementation and will not fully achieve the 80 to 90 percent
switch recovery rate goal. It is expected that a minimum of four
million mercury switches will be recovered during the first three years
of the program in addition to the mercury being recovered by existing
State programs. The parties agreed to make every effort to exceed this
amount through aggressive implementation of the responsibilities
detailed in this agreement.
    One year following the effective date of the MOU and each year
thereafter, the parties or their designees and EPA agreed to meet to
review the effectiveness of the program at the State level based upon
recovery and capture rates. The parties to the agreement agreed to use
the results to improve the performance of the program and to explore
implementation of a range of options in that effort. Two and one-half
years from the inception of the program, the parties agreed to meet and
review overall program effectiveness and performance. This review will
include discussion of the number of switches that have been collected
and what factors have contributed to program effectiveness.
    A key element of measuring the success of the program is
maintaining a database of participants that has detailed contact
information, documentation showing when the participant joined the
program (or started submitting mercury switches), records of all
submissions by the participant including date, number of mercury
switches, and confirmation that the participant has submitted mercury
switches as expected. Another important element is aggregated
information to be updated on a quarterly basis, including progress
reports, summaries of the number of program participants by State,
individual program participants, and State and national recovery
totals. The program is also estimating the number of motor vehicles
recycled. The NVMSRP will issue reports quarterly during the first year
of the program, every six months in the second and third year of the
program, and annually thereafter. The reports prepared by ELVS will
include the total number of dismantlers or other potential participants
identified; the total number of dismantlers or others contacted; and
the total number of dismantlers or others participating. The annual
report will include the total mercury (in pounds) and number of mercury
switches recovered nationwide; the total pounds of mercury, number of
mercury switches, and an estimated national capture rate, with
information organized by State, compared with the expected range of
mercury switch retirement rates for each State; and the total number
and identity of dismantlers or others dropped due to inactivity or
withdrawal from the program.
    Facilities choosing to use the NVMSRP to comply with this proposed
standard would have to assume all of the responsibilities for
steelmakers as described in the MOU and take steps consistent with the
NVMSRP to minimize the presence of mercury in scrap from end-of-life
vehicles. Participating steelmakers were to initiate the following
steps when the NVMSRP went into effect:
     Issue a statement that the individual steel company is
participating in the NVMSRP.
     Acting independently, develop a plan demonstrating the
manner through which it is participating in the NVMSRP. The plan should
include facility-specific implementation elements, corporate-wide
policies, and/or efforts coordinated by a trade association as
appropriate for each facility.
     Provide in the plan documentation of direction to
appropriate staff to communicate to suppliers the need to promote the
NVMSRP with suppliers throughout the scrap supply chain. The steel mill
should be able to provide examples of materials that it uses for
outreach to suppliers, such as letters, contract language, policies for
purchasing agents, and scrap inspection protocols.
     Strongly encourage their suppliers and others in the scrap
supply chain to support and participate in the NVMSRP.
     Take steps to minimize the presence of mercury in scrap,
which includes notifying suppliers that the steelmaker, acting
independently pursuant to the NVMSRP, intends to use in their
operations, to the maximum extent possible, scrap from vehicles which
do not contain mercury switches or from which mercury switches have
been removed and to adapt their respective purchasing practices to that
end.
     Use the ELVS database or other appropriate means to
demonstrate that suppliers (spot suppliers and those under continuous
contracts) are participating as anticipated in the NVMSRP and
periodically re-affirm their commitment to provide only reduced-mercury
automobile scrap. Steelmakers will conduct occasional spot checks, site
visits or other means of corroboration to ensure that suppliers are
aware of the need and are implementing appropriate steps to minimize
the presence of mercury in automobile scrap.
     Cooperate with ELVS in the development of education,
training materials, and outreach where appropriate.
     Work with the Institute of Scrap Recycling Industries to
assure that any scrap work practice standards or other programs that
may be implemented in accordance with the NVMSRP take into account
market and technological factors and do not create unreasonable

or unworkable certification requirements for scrap processors.
    We propose that the Administrator can evaluate the success of the
program at any time, identify States where improvements might be
needed, recommend options for improving the program in a particular
State, and if necessary, disapprove the program as implemented in a
State from being used to demonstrate compliance with this proposed rule
based on an assessment of this performance. The evaluation would be
based on progress reports submitted to the Administrator that provide
the number of mercury switches removed, the estimated number of
vehicles processed, and percent of mercury switches recovered. The
Administrator will assess the information with respect to the program's
goal for percent switch recovery and trends in recovery rates.
    Although the national program would be an EPA-approved program for
the purpose of complying with the proposed MACT standard, other State,
local, or facility-specific programs could qualify as a compliance
option on a case-by-case basis if they met the same criteria.
Consequently, we also are proposing as the MACT floor participation in
these other programs after satisfying criteria based on the national
program, i.e., showing that these other programs would assure the same
level of mercury control that the national program utilized by the best
existing performers achieves, that would be used by the Administrator
to determine if other switch removal programs could be used to
demonstrate compliance.
    For example, we are proposing that a facility could prepare and
operate pursuant to a site-specific plan for the removal of mercury
switches and establish scrap specifications for the removal of mercury
switches to achieve the MACT level of control (i.e., control as
effective as the national plan). The plan would be submitted to the
Administrator for approval and would demonstrate how the EAF
steelmaking facility will comply with the following specific
requirements: (1) A means of communicating to scrap purchasers and
scrap providers the need to obtain or provide motor vehicle scrap from
which mercury switches have been removed and the need to ensure the
proper management of the removed mercury switches, (2) provisions for
obtaining assurance from scrap providers that motor vehicle scrap
provided to the EAF meets the scrap specifications, (3) provisions for
periodic inspection, site visits, or other means of corroboration for
the EAF to ensure that scrap providers and dismantlers are implementing
appropriate steps to minimize the presence of mercury switches in motor
vehicle scrap, (4) a goal for the removal of at least 80 percent of the
mercury switches, (5) provisions for taking corrective actions if
needed, and (6) requiring each motor vehicle scrap provider to provide
an estimate of the number of mercury switches removed from motor
vehicle scrap sent to the facility during the previous year and the
basis for the estimate. The Administrator would be able to request
documentation or additional information and change the approval status
of the plan at any time based on a review of progress toward meeting
the switch removal goal and other factors.
    We developed an equivalent compliance option (also based on
pollution prevention) for steelmakers who do not purchase motor vehicle
scrap that contains mercury switches. The compliance option would
require the facility to certify that the only materials from motor
vehicle scrap are materials recovered for their specialty alloy, such
as chromium in certain exhaust systems, and that the type of scrap is
not reasonably expected to contain mercury switches.
    Proposed beyond-the-floor determination. As a beyond-the-floor
option, we considered the upstream removal of mercury-containing
components other than mercury switches. There is no practical or
reasonable way to remove trace amounts of mercury entering with raw
materials (such as fluxing agents and alloys) other than scrap.
Although there are other components in automobile scrap containing
small amounts of mercury (see the earlier discussion above), pilot
studies by various States have found that most of the mercury is
contributed by the mercury switches, which take only a few minutes to
locate and remove. (See the reports of switch removal studies in Maine,
New Jersey, and Michigan in the rulemaking docket.) Other mercury-
containing components contribute less mercury, and they are more
difficult to locate, identify, and remove. For example, the mercury
switch study performed by the New Jersey Department of Environmental
Protection found that convenience light switches could be located and
removed in less than one minute. However, the time to remove and locate
switches in anti-lock braking systems (ABS) required 7 to 8 minutes to
locate, remove the rear seat, unbolt the unit, and remove it. In some
cases, no ABS mercury switches were found. Some vehicles had to be
raised on lifts, which required 10 to 15 minutes to locate and remove
the ABS switch. In other cases, the ABS mercury bullet could not be
removed separately because it was encased in a plastic resin material.
Since the removal of these other mercury-containing components is
costly and not practical in many cases, we have initially determined
that the removal of these other mercury-containing components is not
justified as a beyond-the-floor standard. However, we propose to
encourage their removal by crediting all documented and verifiable
mercury-containing components removed from motor vehicle scrap (such as
sensors in ABS systems, security systems, active ride control, and
other applications) when evaluating progress towards the 80 percent
goal.
    We also examined the feasibility and cost of an add-on control
device for mercury and continuous emissions monitoring as a beyond-the-
floor option for mercury for existing and new sources. Activated carbon
injection has been used on other somewhat similar processes (i.e.,
similar with respect to temperature and volumetric flow rate); however,
it has never been used at EAF facilities, and thus is not a
demonstrated mercury control technology for EAF facilities. The
nationwide cost of activated carbon injection and monitoring on EAFs is
estimated as $100 million/yr. The mercury reductions are estimated as
about 5 tpy after implementation of the national mercury switch
recovery program. Assuming that activated carbon injection could be
applied to EAFs and would reduce the remaining mercury emissions by 90
percent (4.5 tpy), the cost effectiveness would be $22 million per ton
of mercury. This cost does not include the further high cost of waste
treatment and disposal noted in the next paragraph.
    We also considered other factors: (1) The EAF batch process has
highly variable concentrations of mercury in the exhaust gases (which
results in a great deal of uncertainty with respect to cost, design,
and efficiency of an add-on control system), (2) carbon injection could
result in landfilling large quantities of hazardous EAF dust (since the
carbon injection residue is commingled with other baghouse dust) that
is currently recycled to recover its zinc value (see American Petroleum
Inst. v. EPA, 906 F. 2d 729, 734, 740-41 (D.C. Cir. 1990) and 53 FR
11752-11753, August 17, 1988) because the mercury would either be re-
emitted at the zinc smelter (in which case there would effectively be
no further reduction of mercury emissions) or the baghouse dust which
is otherwise

recyclable would have to be treated and disposed in a RCRA subtitle C
landfill (a non-air adverse environmental impact we are required to
consider under section 112(d)(2)) at a significant cost, and (3) the
operation of a carbon injection (or any type of mercury emissions
control device) would result in increased energy consumption (another
adverse impact we are required to consider under section 112(d)(2)).
    Based on the fact that activated carbon injection is not a
demonstrated mercury control technology for EAF facilities, the
uncertainty in design and performance of the add-on controls and hence
of the actual mercury emission reductions for EAF facilities, the cost
impacts per ton of emission reduction, and the adverse energy and solid
waste impacts, we determined that control beyond the floor is not
warranted for mercury. Therefore, we are proposing that the removal of
mercury switches from the scrap before it is melted in the EAF
represents MACT for mercury for new and existing EAF facilities.
2. Proposed GACT Standards for Metal HAP Other Than Mercury
    Background. EAF steelmaking facilities were listed under CAA
section 112(c)(3) for emissions of the Urban HAP arsenic, cadmium,
chromium, lead, manganese, mercury, and nickel (67 FR 43112). As just
explained in section IV.D.2 of this preamble, we are proposing a MACT
standard for mercury based on its listing under CAA section 112(c)(6).
For metal HAP other than mercury, we decided that it is not practical
to establish individual standards for each specific type of metallic
HAP that could be present in the emissions (e.g., separate standards
for manganese emissions, lead emissions, and so forth for each of the
metals listed as HAP that may be present) because the types and
quantities of metal HAP can vary widely in the scrap. When released,
each of the metallic HAP compounds other than mercury behaves as PM.
The control technologies used for the control of PM emissions achieve
comparable levels of performance for these metallic HAP emissions,
i.e., when PM is captured, HAP metals are captured non-preferentially
as part of the PM. Therefore, emission standards requiring control of
PM will also achieve comparable control of metallic HAP emissions.
Establishing separate standards for each individual type of metallic
HAP would impose costly and significantly more complex compliance and
monitoring requirements and achieve no HAP emissions reductions beyond
what would be achieved using the surrogate pollutant approach based on
capture and control of PM.
    As provided in CAA section 112(d)(5), we are proposing standards
representing GACT for the Urban HAP metals other than mercury. EPA
believes that the statute allows the agency to elect to establish
standards for area sources listed pursuant to section 112(c) based on
GACT without further explanation. The statute simply does not set any
condition precedent for issuing standards under section 112(d)(5) other
than that the area source category or subcategory at issue must be one
that EPA listed pursuant to section 112(c), which is the case here. See
72 FR 38880 (July 16, 2007).
    We reviewed the control technologies and management practices used
by the existing EAF steelmaking facilities, and we found that all of
the plants are well controlled for PM emissions and are subject to
emissions limits for PM. All plants have capture systems that collect
emissions from charging, melting, tapping and ladle metallurgy and
route the collected gases to a PM control device. All plants have title
V permits because they are major sources for criteria pollutants (hence
the standards proposed today would be implemented via title V permits).
In addition, all plants are subject to the CAM requirements in 40 CFR
part 64.
    There are a wide variety of capture systems and types of control
devices that EAFs employ to achieve control of PM, and all of these
systems are effective and generally available. For example, capture
systems include direct-shell evacuation, canopy hoods, close-fitting
hoods, side draft hoods, tapping hoods, partial enclosures, total
enclosures, scavenger duct systems, building evacuation, or a
combination. Control devices include many different types of baghouses
(positive pressure, negative pressure, reverse air, shaker, and pulse
jet) and venturi scrubbers. We concluded from our technology review
that the generally available control technologies and management
practices for PM emissions, and thus for emissions of HAP metals other
than mercury, consist of the installation, operation, and maintenance
of capture and control systems for PM emissions from charging, melting,
tapping, and ladle metallurgy. Compliance assurance monitoring under 40
CFR part 64 is required for EAF facilities to ensure that the capture
and control systems are properly installed, operated, and maintained on
a continuing basis.
    Subcategories. As part of the GACT analysis, we considered whether
there were differences in processes, sizes, or other factors affecting
emissions and control technologies that would warrant
subcategorization. Under section 112(d)(1) of the CAA, EPA ``may
distinguish among classes, types, and sizes within a source category or
subcategory in establishing such standards * * *''. We found that there
is a segment of the EAF steelmaking industry that is comprised of small
facilities producing specialty and stainless steel. These facilities
produce less than 150,000 tpy of steel per plant, and they represent
0.5 percent of the national steelmaking capacity and contribute only
0.5 percent of the HAP emissions.\21\ The EAF process at these small
producers is characterized by small furnaces with low volume of
emissions, longer cycle times, and intermittent rather than continuous
operation. In addition, they use high quality scrap that must meet
specifications much more stringent than those applied to scrap for
carbon steel producers. The HAP metals emitted from these facilities
are primarily chromium and nickel, whereas carbon steel producers emit
primarily manganese and lead. Consequently, we are proposing to develop
GACT standards for two subcategories of EAF steelmaking: one for all
carbon steel and large stainless and specialty steel producers and one
for small stainless and specialty steel producers (i.e., less than
150,000 tpy).
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    \21\ Additional details on the characteristics of the small
specialty steel plants can be found in the rulemaking docket.
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    Proposed GACT determination for carbon steel and large specialty
steel producers. We examined emission limits in title V permits to
determine if GACT for the carbon steel and large specialty steel
producers could be expressed in terms of PM emission limits for control
devices and opacity limits for fugitive emissions from the melt shop.
The emission and opacity limits vary quite widely depending on whether
the facility is in a non-attainment area for PM; whether the EAF had
recently been constructed, modified, or reconstructed; EAF age; design
of the capture and control system; and other factors. (Details on the
permit information are provided in the rulemaking docket in the
questionnaire responses for each company that was surveyed.) The most
commonly-applied emissions and opacity limits are those in the new
source performance standard (NSPS) in 40 CFR part 60, subpart AAa,
which applies to EAFs constructed after August 7, 1983. Approximately
80 of the 91 EAF steelmaking area source facilities that we have
identified are subject to the NSPS. These limits are

0.0052 gr/dscf for the control device and a melt shop opacity limit of
6 percent (6-minute average) for fugitive emissions.
    We gathered additional information on the 10 older EAFs in the
carbon steel and large specialty steel subcategory that are not subject
to the NSPS and found that four facilities are currently meeting the
NSPS limits and six facilities are not meeting the NSPS opacity limit
for fugitive emissions. We found that the facilities not meeting the
NSPS opacity limit would require either new or extensively upgraded
capture and control equipment to achieve the level of control required
for the newer facilities subject to the NSPS. We confirmed that these
facilities would need higher evacuation rates for their capture systems
and new or expanded baghouse capacity. We obtained cost estimates from
the plants, and we performed our own independent estimates of the cost
to upgrade capture and control systems. The total nationwide capital
cost to upgrade to meet the NSPS limit for opacity was estimated as $26
to $34 million.\22\ The total annualized cost was estimated as $4.9 to
$6.2 million per year nationwide. PM emissions would be reduced by 540
tpy, and HAP metals other than mercury would be reduced by 34 tpy. The
average cost effectiveness per plant ranged from $2,000 to $14,000 per
ton of PM with an overall cost effectiveness of $10,000 per ton of PM.
For metal HAP other than mercury, the average cost effectiveness per
plant ranged from $40,000 to $250,000 per ton with an overall cost
effectiveness of $160,000 per ton of HAP. The cost effectiveness for PM
is well within the range that EPA has considered acceptable for other
sources, such as PM standards for mobile sources. For example, the cost
effectiveness of mobile source programs adopting (quite aggressive) PM
controls has ranged from $2,390 per ton of PM to $31,530 per ton of PM
with estimates for three mobile source programs in the range of $10,000
to $20,000 per ton of PM (69 FR 39133, June 29, 2004).\23\
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    \22\ The capital cost per plant ranged from $1.5 million to $12
million, and the total annualized cost per plant ranged from
$140,000 to $2.8 million per year. All estimates of impacts (e.g.,
costs and emission reductions) are documented in the rulemaking
docket.
    \23\ We note that, although section 112(d) only authorizes
control of hazardous air pollutants (HAP), and particulate matter
(PM) is not itself a HAP but a surrogate for HAP metals, Congress
expected the maximum achievable control technology (MACT) program to
result in significant emissions reductions of criteria air
pollutants (of which PM is one), and viewed this as an important
benefit of the MACT (and residual risk) provisions. See 5
Legislative History at 8512 (Senate Committee Report) (``[w]hen
establishing technology-based standards under this subsection, the
Administrator may consider the benefits which result from control of
air pollutants that are not listed but the emissions of which are,
nevertheless, reduced by control technologies or practices necessary
to meet the prescribed limitation'')
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    Our economic analysis indicated the facilities are owned and
operated by large corporations, and all but one of these corporations
operate multiple plants with EAFs. We believe that the costs of
upgrades to meet the NSPS level of control for opacity are economical
and would not pose adverse economic impacts on the companies. After
considering the economic impacts, the reasonable costs and cost
effectiveness for control of PM and HAP, and the emissions reductions
that would be obtained, we have determined initially that an opacity
limit of 6 percent represented the GACT level of control for this
subcategory of carbon steel and large stainless and specialty steel
producers.
    We acknowledge that there is uncertainty in our estimates of costs,
emission reductions, and cost effectiveness. The estimates of costs and
cost effectiveness for the older non-NSPS plants could be higher than
we have initially estimated, and if that is the case and these costs
are disproportionately different from those of other sources, it might
be appropriate to consider a separate subcategory based on the
technical and economic feasibility (i.e., facilities constructed prior
to 1983 may need to add or alter existing infrastructure, upgrade their
hooding, close vents, install partitions, or re-route crane ways) of
retrofitting facilities based on their age.\24\ If subcategorization on
this basis is appropriate, we believe that GACT for these older
facilities would achieve an opacity limit of 6 percent except for 20
percent opacity during charging and tapping. This alternative standard
would yield an improvement in existing performance at reasonable cost.
We request comment, along with supporting documentation, on our
estimates of cost and cost effectiveness and the possibility of
creating a separate subcategory for older facilities and whether these
costs are disproportionately different from those of other industry
sources. Supporting documentation must be provided in sufficient detail
to allow characterization of the quality and representativeness of the
data.
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    \24\ See Texas Oil and Gas Ass'n v. EPA, 161 F.3d 923, 934 (5th
Cir. 1998) (age as subcategorization factor under Clean Water Act);
American Iron and Steel Inst. v. EPA, 568 F. 2d 244, 299 (3rd Cir.
1977) (same). Here, the year 1983 is critical since EPA promulgated
new source performance standards (NSPS) for the electric arc furnace
(EAF) source category in that year. Most of the industry is subject
to these standards, but 10 EAFs are not, raising the question of
whether these sources should be considered as a separate subcategory
for purposes of determining generally available control technology
(GACT). See Cf. American Iron and Steel Inst. v. EPA, 526 F. 2d
1046, 1048 (3rd Cir. 1975) (age of source may bear on technical and
economic feasibility of retrofitting).
---------------------------------------------------------------------------

    We also evaluated the generally available controls and emission
limits applied to emissions from control devices on EAFs and ladle
metallurgy operations. A total of 80 plants are subject to and achieve
the NSPS PM limit of 0.0052 gr/dscf, and the other 10 plants not
subject to the NSPS have installed baghouses that can achieve the
limit. Consequently, we are also proposing that the PM limit of 0.0052
gr/dscf is GACT for control devices applied to EAFs and ladle
metallurgy operations.
    We also considered whether additional control and emission
reductions might be generally available beyond those achieved by the
NSPS. The NSPS opacity limit of 6 percent is one of the most stringent
Federal limits in effect for fugitive emissions and is well below the
most commonly applied limit of 20 percent for fugitive emissions in
State regulations. The NSPS opacity limit was based on the best-
performing plants in terms of their ability to capture and control
fugitive emissions. A limit more stringent than 6 percent opacity for
fugitive emissions has not been applied to EAFs or other similar
processes, and any limit more stringent would approach an infeasible
standard of no visible emissions. Consequently, we concluded that an
opacity limit of 6 percent is GACT for fugitive emissions from EAF
operations.
    We also considered whether a PM limit more stringent than the NSPS
limit of 0.0052 gr/dscf might be achieved by all facilities using the
technology described above. Although the NSPS is 20 years old, it was
based on the best technology and best-performing sources at that time.
The NSPS level of control is achieved by a well-designed and properly-
operated baghouse with a low air-to-cloth ratio that is characteristic
of baghouses in use today, and generally reflected testing of the
baghouses when performing at their optimum. For example, essentially
the same level of PM control (a limit of 0.005 gr/dscf) was promulgated
as the MACT standard for EAFs and induction furnaces at iron and steel
foundries, which melt similar scrap and have similar operating
characteristics (69 FR 21924, April 22, 2004). An upgrade of existing
baghouses (e.g., increasing bag filtering area to lower the air-to-
cloth ratio) would result

in expensive retrofit costs for a very marginal improvement in PM
control. Consequently, we are proposing that the NSPS PM limit of
0.0052 gr/dscf is GACT for control devices applied to EAFs and ladle
metallurgy.
    Proposed GACT determination for small stainless and specialty steel
producers. We also examined the control technologies used by the small
stainless and specialty steel producers with a production of less than
150,000 tpy. We identified five plants in this subcategory, and all of
these plants apply capture systems for emissions from charging,
melting, tapping, and ladle metallurgy (i.e., the direct, non-fugitive
PM emissions) and vent the captured emissions to a PM control device.
Most plants use baghouses as the PM control device and meet the NSPS
limit; however, one plant uses a venturi scrubber as the control device
and meets a PM emission level of 0.8 lb/ton of steel produced. We
performed an analysis of costs and cost effectiveness to determine if
the GACT level of emission control for this subcategory should be
represented by the performance of a baghouse at the NSPS level of
control, the level achieved by the venturi scrubber, or some other
level. The estimated capital cost to replace the venturi scrubber with
a baghouse ranged from $4 to $14 million (depending on retrofit
assumptions and their costs) with a total annualized cost of $0.7 to $2
million per year. PM emissions would be reduced by 27 tpy, and
emissions of HAP metals other than mercury would be reduced by 4.6 tpy.
The estimated cost effectiveness was $52,000 per ton of PM and $300,000
per ton of HAP. We believe that the costs and cost effectiveness are
unacceptably high and that the emission reductions achieved would be
low (resulting in poor cost effectiveness (which is certainly higher
than those considered acceptable in the context just discussed of
fugitive emission control for EAFs). We concluded that the NSPS level
of PM control (0.0052 gr/dscf) does not represent GACT for this
subcategory.
    Consequently, we reviewed the emission control performance of the
plant with the venturi scrubber. The results of four tests for PM
emissions ranged from 0.4 to 0.7 lb/ton of steel with an average of 0.5
lb/ton and a standard deviation of 0.11 lb/ton. The 99th percentile of
performance (the average plus 2.33 standard deviations) is 0.8 lb/ton.
(The 99th percentile is the level of emission control that the plant
can achieve at least 99 percent of the time, i.e., 99 percent of the
test results would be below this level.) See National Wildlife
Federation v. EPA, 286 F.3d 554, 572 (D.C. Cir. 2002) (reasonableness
of adopting 99th percentile confidence level); Chemical Mfr's. Ass'n v.
EPA, 870 F.2d, 229 (5th Cir.) (same). We are proposing a PM emission
limit of 0.8 lb/ton of steel produced for this source category of small
stainless and specialty steel producers based on the 99th percentile of
emission control performance demonstrated by the venturi scrubber.
    We also examined the control of fugitive emissions at the small
stainless and specialty steel producers. All of the plants have
effective capture and control systems for fugitive emissions. Although
two plants are not subject to the NSPS opacity limit of 6 percent for
fugitive emissions, these plants and all other plants in the
subcategory can meet the NSPS limit. Consequently, we have initially
determined that the NSPS limit of 6 percent for fugitive emissions from
the melt shop represented GACT. As we discussed above, the NSPS opacity
limit of 6 percent is one of the most stringent limits in effect for
fugitive emissions and is well below the most commonly applied limit of
20 percent for fugitive emissions in State regulations. The NSPS
opacity limit was based on the best performing plants in terms of their
ability to capture and control fugitive emissions. Consequently, we
initially concluded that an opacity limit more stringent than 6 percent
for this subcategory is not warranted and would not represent GACT.
    Proposed compliance monitoring. We are proposing compliance
assurance monitoring as required by 40 CFR part 64 for all EAF
steelmaking facilities. This proposal is based on a review of the
compliance monitoring procedures that are currently in place at EAF
facilities and are generally available. All EAF facilities have title V
permits and are subject to the CAM requirements. The CAM rule requires
the owner or operator to maintain records of monitoring data, monitor
performance data, corrective actions taken, any written QIP, any
activities undertaken to implement a QIP, and other supporting
information required by the part 64 rule (such as data used to document
the adequacy of monitoring, or records of monitoring maintenance or
corrective actions). The general reporting requirements of part 64
requires the owner or operator to submit monitoring reports to the
permitting authority in accordance with the requirements for facilities
with title V operating permits, which include a 6-month monitoring
report, deviation reports, and annual compliance certifications. The
reporting requirements under part 64 require that the 6-month
monitoring report include: (1) Summary information on the number,
duration and cause (including unknown cause, if applicable) of
excursions or exceedances, as applicable, and the corrective actions
taken; (2) summary information on the number, duration and cause
(including unknown cause, if applicable) for monitor downtime incidents
(other than downtime associated with zero and span or other daily
calibration checks, if applicable); and (3) a description of the
actions taken to implement a QIP during the reporting period. Upon
completion of a QIP, the owner or operator must include in the next
summary report documentation that the implementation of the plan has
been completed and reduced the likelihood of similar levels of
excursions or exceedances occurring. We are proposing to adopt the
extensive compliance assurance monitoring requirements in part 64 in
this proposed NESHAP for EAF steelmaking facilities.
3. Proposed GACT Standards for Scrap to Control HAP Other Than Mercury
    In addition to the standards for PM, EPA is proposing further
measures to minimize the amount of contamination in scrap to EAFs. Our
studies of industry practices indicate that many facilities have scrap
specifications and procedures to minimize contaminants in the scrap.
For example, emissions of the Urban HAP lead are reduced by ensuring
that lead components, such as wheel weights, batteries, and cables, are
removed before the scrap is processed and melted (loosely analogous to
the mercury switch program discussed for mercury in that the HAP is
removed from the scrap before it reaches the EAF). Although EAFs were
not listed for emissions of organic Urban HAP, it is also common
industry practice to limit the amount of plastics and organic liquids
in the scrap, which reduces the emissions of organic HAP. Unlike
mercury, bulky items such as batteries and cables, as well as dripping
liquids, can often be visually detected in a scrap load. Consequently,
we are proposing pollution prevention measures as GACT for lead and
organic HAP. These pollution prevention measures reduce emissions
beyond those achieved by the emission controls that are already in
place. For example, all EAFs have PM control devices, which also
control lead emissions; however, preventing lead from entering the EAF
provides additional reductions even with PM controls. Similarly, some
organic HAP are destroyed at the high temperatures used to melt scrap,
but preventing plastics and organic liquids from entering with the
scrap provides

reductions beyond that achieved by this thermal destruction.
    Our survey of EAF plants indicated that all of the plants have
specifications for their scrap, including measures that reduce HAP
emissions by preventing certain materials from entering the EAF with
the scrap. For example, some specify no non-ferrous metals, no non-
metallic materials, no free-flowing oil, etc. Excluding organic
materials (such as plastics and oil) and metals such as lead will
reduce HAP emissions, and in the case of organics, also reduce the
formation of combustion-product organic HAP at the high operating
temperatures of the EAF.
    It is difficult to quantify specific emissions reductions achieved
by these scrap management programs. First, nearly all plants implement
some sort of formal or informal scrap management program (to maintain
product quality), so it is difficult to assess what the baseline
emissions might be without one. Second, these scrap management programs
are used in conjunction with other air emissions control technologies
to reduce emissions from the EAF. The emissions reductions specifically
attributable to the scrap management program are impossible to separate
out. Nonetheless, it is clear that any reduction in HAP content or HAP
precursors entering the EAF will reduce the emissions of HAP metals and
organics from the EAF.
    While a scrap management program is expected to reduce HAP
emissions, it cannot be expected to eliminate all HAP elements or
precursors in the scrap. First, scrap loads are generally large and
difficult to inspect. A load of scrap may contain thousands of
different pieces, and some scrap may be shredded and bundled. Visual
inspections are only able to identify obvious off-specification
materials that are on the top of a load. Second, some of the HAP
elements are desirable components in the scrap iron and steel that
contribute to the overall chemistry of the product and provide valuable
properties in the cast metal (e.g., manganese and chromium.) Third,
even undesirable HAP metals cannot be eliminated from the cast iron and
steel as they are trace components in the scrap iron and steel that
cannot be separated. For example, all cast iron contains trace amounts
of lead (typically 0.5 to 4 percent). As such, a load of scrap meeting
a ``no lead'' scrap specification does not mean that the scrap is lead-
free--only that the scrap is free of lead components (e.g., batteries
or wheel weights).
    We have determined that the management practice of limiting the
amount of organic impurities and lead in the scrap represents GACT
(along with the emission controls described in the previous section of
this preamble) because they are in widespread use, there is little
additional cost for all plants to implement them (most already have),
and there is no doubt that preventing these materials from entering the
EAF will reduce emissions of the HAP which would otherwise be charged
to the furnace. (A summary of the proposed scrap management practices
is provided in section IV.C.4 of this preamble.)

V. Impacts of the Proposed Standards

    As proposed, the standards would reduce mercury emissions from EAF
by an estimated 5 tons per year (tpy) and would reduce mercury releases
to the environment by 8 tpy. The proposed standards would also reduce
emissions of other metallic HAP (primarily manganese with some lead,
nickel and chromium) by about 34 tpy. Emissions of PM would be reduced
by 540 tpy.
    The capital cost of the proposed standards is estimated as $26 to
$34 million. The total annualized cost of the proposed rule is
estimated at $4.9 to $6.2 million/yr, including the annualized cost of
capital and the annual operating costs for emission control systems.
The additional cost of monitoring, reporting, and recordkeeping
attributable to the proposed rule, including the preparation of scrap
management plans and scrap specifications, is estimated as $122,000 per
year. No adverse economic impacts are expected for large or small
entities. Secondary impacts would include an increase in the generation
of hazardous waste (540 tpy) and an increase in electricity usage
(10,400 megawatt-hours per year) from additional fans and fan capacity
associated with baghouse installations and upgrades to meet the
proposed opacity standard. (All estimates of primary and secondary
impacts are documented in the rulemaking docket.)

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
action is a ``significant regulatory action'' because it may raise
novel legal or policy issues. Accordingly, EPA submitted this action to
OMB for review under Executive Order 12866, and any changes made in
response to OMB recommendations have been documented in the docket for
this action.

B. Paperwork Reduction Act

    The information collection requirements in the proposed rule have
been submitted for approval to OMB under the Paperwork Reduction Act,
44 U.S.C. 3501 et seq. The Information Collection Request (ICR)
document prepared by EPA has been assigned EPA ICR No. 2277.02.
    The proposed information requirements are based on notification,
recordkeeping, and reporting requirements in the NESHAP General
Provisions (40 CFR part 63, subpart A), which are mandatory for all
operators subject to national emission standards, and the recordkeeping
and reporting requirements in the part 64 CAM rule, which are based on
the requirements in the operating permits rule (40 CFR parts 70 and
71). These recordkeeping and reporting requirements are specifically
authorized by section 114 of the CAA (42 U.S.C. 7414). All information
submitted to EPA pursuant to the recordkeeping and reporting
requirements for which a claim of confidentiality is made is
safeguarded according to Agency policies set forth in 40 CFR part 2,
subpart B.
    The proposed rule requires all facilities to submit a one-time
notification of applicability and notification of compliance status
required by the NESHAP general provisions (40 CFR part 63, subpart A).
The notification of compliance status would include compliance
certifications for various rule requirements. The general provisions
also require preparation of a test plan for performance tests and
advance notification of the date the performance test is to be
conducted.
    The proposed requirements for the control of contaminants from
scrap require a pollution prevention plan to minimize the amount of
chlorinated plastics, lead, and free organic liquids that are charged
to the furnace and submit the plan to the Administrator for approval.
Facilities must keep the plan onsite and train certain employees in the
plan's requirements. Alternatively, the facility must restrict the type
of scrap charged to the furnace. For mercury, facilities must prepare a
site-specific plan for removal of mercury switches, submit the plan to
the Administrator for approval, and submit semiannual progress reports
containing information on the mercury switches that have been removed
would also be required. Alternatively, facilities must purchase motor
vehicle scrap only from suppliers that participate in an approved
program for the removal of mercury switches or recover only

material for its specialty alloy content that does not contain mercury
switches. Facilities would be required to maintain records to
demonstrate compliance with the selected option. Records of specific
information would be required for plants electing to comply with the
site-specific plan for mercury; semiannual progress reports would also
be required.
    All area source facilities would be required to conduct performance
tests to demonstrate initial compliance with the applicable PM and
opacity limits. Existing facilities would be allowed to certify initial
compliance based on the results of a previous performance test that
meets the rule requirements. All facilities would be required to
monitor capture systems and PM control devices for EAF and ladle
metallurgy operations, maintain records, and submit reports according
to the part 64 CAM requirements. These reports include deviation
reports, semiannual monitoring reports, and annual compliance
certifications.
    Consistent with Sec.  63.6(e) of the general provisions, all plants
would be required to prepare and operate by a startup, shutdown, and
malfunction plan, and make an immediate report if a startup, shutdown,
or malfunction was not consistent with their plan. Plants also would
keep records and make semiannual reports according to the requirements
in Sec.  63.10.
    The annual average monitoring, reporting, and recordkeeping burden
for this collection (averaged over the first 3 years of this ICR) is
estimated to total 2,393 labor hours per year at a cost of $121,573.
This includes 2.7 responses per year from each of 91 respondents for an
average of about 9.7 hours per response. There are no additional
capital/startup costs or operation and maintenance costs associated
with the proposed rule.
    Burden means the total time, effort, or financial resources
expended by persons to generate, maintain, retain, or disclose or
provide information to or for a Federal agency. This includes the time
needed to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and
verifying information, processing and maintaining information, and
disclosing and providing information; adjust the existing ways to
comply with any previously applicable instructions and requirements;
train personnel to be able to respond to a collection of information;
search data sources; complete and review the collection of information;
and transmit or otherwise disclose the information.
    An agency may not conduct or sponsor, and a person is not required
to, respond to a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR part 63 are listed in 40 CFR part 9.
    To comment on the Agency's need for this information, the accuracy
of the provided burden estimates, and any suggested methods for
minimizing respondent burden, including the use of automated collection
techniques, EPA has established a public docket for the proposed rule,
which includes this ICR, under Docket ID number EPA-HQ-OAR-2004-0083.
Submit any comments related to the ICR for the proposed rule to EPA and
OMB. See the ADDRESSES section at the beginning of this notice for
where to submit comments to EPA. Send comments to OMB at the Office of
Information and Regulatory Affairs, Office of Management and Budget,
725 17th Street, NW., Washington, DC 20503, Attention: Desk Office for
EPA. Because OMB is required to make a decision concerning the ICR
between 30 and 60 days after September 20, 2007, a comment to OMB is
best assured of having its full effect if OMB receives it by October
22, 2007. The final rule will respond to any OMB or public comments on
the information collection requirements contained in the proposal.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act generally requires an agency to
prepare a regulatory flexibility analysis of any rule subject to notice
and comment rulemaking requirements under the Administrative Procedure
Act or any other statute unless the agency certifies that the rule
would not have a significant economic impact on a substantial number of
small entities. Small entities include small businesses, small not-for-
profit enterprises, and small governmental jurisdictions.
    For the purposes of assessing the impacts of this proposed rule on
small entities, small entity is defined as: (1) A small business that
meets the Small Business Administration size standards for small
businesses at 13 CFR 121.201 (whose parent company has fewer than 1,000
employees for NAICS code 331111; (2) a small governmental jurisdiction
that is a government of a city, county, town, school district, or
special district with a population of less than 50,000; and (3) a small
organization that is any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field. We
estimate that fewer than 9 EAF steelmaking facilities are owned by
small businesses (less than 10 percent of the total facilities).
    After considering the economic impacts of this proposed rule on
small entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. Electric arc
furnaces and ladle metallurgy operations at all EAF steelmaking
facilities that are area sources are already equipped with capture
systems and control devices. We have identified six plants that may
have to upgrade the capture and control systems for fugitive emissions
at a total capital cost of $26 to $34 million and a total annualized
cost of $4.9 to $6.2 million per year. However, none of these plants
are owned by small businesses. The only other additional requirements
of the proposed NESHAP consist of preparing a scrap selection plan or
mercury switch removal plan (if these options are selected) and
maintaining records to document compliance with these requirements. The
requirements of the part 63 General Provisions would include
notifications, records, semiannual reports, and a startup, shutdown,
and malfunction plan. The information required in these information
collection requirements are very similar to the information collection
requirements in 40 CFR parts 64, 70, and 71. The cost of these
requirements (about $3,500 per year per facility) would not result in
an adverse economic impact on any facility, large or small (i.e., the
cost is less than one percent of total revenues, even for small
businesses).
    Although the proposed rule will not have a significant economic
impact on a substantial number of small entities, we nonetheless tried
to reduce the impact of the proposed rule on small entities. We held
meetings with industry trade associations and company representatives
to discuss the proposed rule and have included provisions such as the
lb/ton limit for small facilities that address their concerns. We have
also proposed to include a subcategory based partially on facility size
that allows more individualized consideration of EAFs in the proposed
subcategory, which include small businesses. We continue to be
interested in the potential impacts of the proposed action on small
entities and welcome comments on issues related to such impacts.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local,

and tribal governments and the private sector. Under section 202 of the
UMRA, EPA generally must prepare a written statement, including a cost-
benefit analysis, for proposed and final rules with ``Federal
mandates'' that may result in expenditures by State, local, and tribal
governments, in the aggregate, or to the private sector, of $100
million or more in any 1 year. Before promulgating an EPA rule for
which a written statement is needed, section 205 of the UMRA generally
requires EPA to identify and consider a reasonable number of regulatory
alternatives and adopt the least costly, most cost-effective, or least
burdensome alternative that achieves the objectives of the rule. The
provisions of section 205 do not apply when they are inconsistent with
applicable law. Moreover, section 205 allows EPA to adopt an
alternative other than the least costly, most cost-effective, or least
burdensome alternative if the Administrator publishes with the final
rule an explanation why that alternative was not adopted. Before EPA
establishes any regulatory requirements that may significantly or
uniquely affect small governments, including tribal governments, it
must have developed under section 203 of the UMRA a small government
agency plan. The plan must provide for notifying potentially affected
small governments, enabling officials of affected small governments to
have meaningful and timely input in the development of EPA regulatory
proposals with significant Federal intergovernmental mandates, and
informing, educating, and advising small governments on compliance with
the regulatory requirements.
    The EPA has determined that the proposed rule does not contain a
Federal mandate that may result in expenditures of $100 million or more
for State, local, and tribal governments, in the aggregate, or to the
private sector in any one year. Thus, the proposed rule is not subject
to the requirements of sections 202 and 205 of the UMRA. In addition,
the proposed rule does not significantly or uniquely affect small