These changes in the NOx rates will result in additional changes to the final unit-level allowance allocations. Electric generating companies will have no opportunity to review the new NOx rates assigned to their units and, thus, no opportunity to evaluate whether EPA made correct adjustments. Thus, EPA should also provide this information for public review and comment before proceeding to final action. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.9]
For the reasons discussed above and in UARG's PTR Comments, the proposed NOx and SO2 allocations are likely to change due to a number of factors, including the many errors and ill-founded assumptions contained in NEEDS and IPM and reflected in the NODA information. EPA will presumably make at least some of the corrections requested in comments on the PTR and NODA. Fluctuation of allowance allocations prevents electric generating companies from planning for the future, which further exacerbates the problems associated with the extremely compressed schedule under EPA's proposal for installation of controls -- a matter discussed in detail in UARG's PTR comments. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.9]
In a stakeholder meeting held shortly after EPA issued the PTR but before its publication in the Federal Register, EPA requested that electric generating companies provide detailed comments correcting any inaccurate data or ill-founded assumptions that EPA made with respect to specific units. Publication of the NODA, which changes much of the information and many of the assumptions on which the PTR was based, has required electric generating companies to start over and to attempt, at considerable cost and with great difficulty, to repeat the same process -- to the extent it is even possible to do so based on the limited and incomplete information provided by EPA. Yet EPA has, without explanation, failed to provide the information that would be necessary for companies to complete reviews similar to those that they undertook with respect to the PTR. Without the detailed information regarding key IPM runs and the assumptions associated with statewide budgets and unit-specific allocations discussed above, electric generating companies lack the information necessary to comment meaningfully on the impact of the NODA on the PTR. Thus, EPA has failed to provide an adequate opportunity for public review and comment on its proposal. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.9-10]
EPA's Decision To Base 2014 SO2 Allowance Allocations for Units in Group 1 States on the Same State-Level Emission Caps Used in the PTR -- Even Though Revised Data and an Updated Modeling Tool Were Available -- Is Arbitrary and Unjustified. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.10]
The primary purpose of the NODA was ostensibly to announce "an updated version of the power sector modeling platform that EPA proposes to use to support the final rule . . . consist[ing] of updated unit level input data ( [NEEDS v4.10]) and a set of model run results with the updated modeling platform ([IPM] v4.10)." The "set" of model run results that EPA elected to provide pursuant to the NODA was, in fact, seriously deficient, for reasons discussed in these comments. With respect to UARG's comments in section VII below, which urge EPA to redo its entire analysis using the updated NEEDS database and revised IPM platform, EPA's decision not to provide an updated "TR SO2 2000" IPM run, using the revised database and modeling platform, to establish new proposed 2014 SO2 state budgets provides one of the clearest example of the flaws in EPA's process. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.10]
EPA stated in its State Budgets TSD that "[g]roup 1 state budgets are based on reductions projected to be cost-effective at $2000 per ton of SO2 . . . [based on] . . . the IPM run [i.e., TR SO2 2000]." EPA did not state directly in the NODA that this critically important run would be omitted from the new data "set," but it got that point across nonetheless: [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.10-11]
These policy runs [i.e., the limited set of runs that EPA provided] include the same State-level caps that EPA modeled in the Proposed Transport Rule. The caps have not been modified to account for any changes that the new modeling might suggest; they are merely provided for informational purposes to allow commenters to understand the impact that changes in the model platform have on the projected impacts of the caps. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.11]
The "State-level caps" to which EPA apparently refers, i.e., the 2014 SO2 budgets for group 1 states, are the results of the TR SO2 2000 IPM run. The results of that run are input to the IPM Run  -  TR SB Limited Trading  -  Summary Report run and the unit-level parsed file for 2014. The practical effect of holding the 2014 SO2 budgets for group 1 states constant and re-running the TR SB Limited Trading runs with the updated NEEDS database and IPM platform is that an individual unit's percentage of the state budget changes but the state budget does not -- i.e., a unit's share of the "pie" changes but the size of the pie (artificially) remains the same. It would be far more relevant and more useful for electric generating companies (and states) to have access not only to the information provided with the NODA but also to a model run that demonstrates the effects of the updated database and modeling platform on the size of the state budgets. EPA must have known that "new modeling" of state budgets based on the updated NEEDS and IPM platform would not merely "suggest" revised emission caps -- that new modeling in fact would plainly result in establishment of new caps at levels different from those proposed under the PTR. EPA provides no justification for its decision not to provide a TR SO2 2000 IPM run using the updated NEEDS database and IPM platform. In short, EPA's decision to re-run the Limited Trading unit-level parsed file for 2014 with the revised NEEDS database and updated IPM platform while leaving state budgets the same -- based on the unrevised data and IPM platform used in the PTR -- is illogical and arbitrary. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.11-12]
Although EPA's failure to provide the updated 2014 SO2 budgets for group 1 states based on IPM v.4.10 undermines the public's ability to understand the impact of the updated NEEDS database and IPM platform on the state-level caps for 2014, even a cursory comparison of the limited set of new IPM runs provided with the NODA demonstrates that the impact of the updated NEEDS database and updated IPM platform must be significant. Among the few IPM runs based on the updated NEEDS database and updated IPM platform that EPA did provide in the NODA are the TR SB Limited Trading Summary reports for 2012, 2015, 2020, and 2030. The following comparisons of these reports with reports based on the corresponding IPM run using the earlier versions of NEEDS and IPM illustrate the dramatic impacts of using the new information: [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.12]
The total projected demand for power in 2015 is reduced by 230 GWh -- from 4,333 GWh in the PTR to 4,103 GWh in the NODA. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.12]
The PTR projected 23.7 GW of new generation capacity from coal and 2.3 GW of new generation capacity from wind by 2015. The NODA projects only 2 GW of new generation capacity from coal and 22 GW of new generation capacity from wind by 2015 -- almost the exact inverse of EPA's projection for these two energy sources in the PTR. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.12]
The PTR projected a total of 80.3 GW of flue gas desulfurization ("FGD") unit retrofits by 2015, while the NODA projects a total of only 49 GW of FGD retrofits by 2015. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.12]
These very substantial changes in EPA's projections of the demand for power, the projected mix of new generation capacity, and projected pollution control retrofits suggest that it would be reasonable to expect significant changes in the 2014 SO2 budgets for group 1 states (as well as the 2012 SO2 and NOx budgets) if those budgets are based on the revised versions of NEEDS and IPM. EPA thus should promptly provide the results of a re-run TR SO2 2000 using the new NEEDS and IPM versions. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.12-13]
Several of the Revisions to NEEDS and IPM that Are Reflected in the NODA Are Inappropriate or Inadequately Explained. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.13]
EPA's Upward Adjustment of Its Assumption Regarding FGD Maximum Removal Efficiency Is Unjustified and Inaccurate. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.13]
EPA states in its IPM v.4.10 Documentation that it assumes a maximum SO2 emission removal efficiency for wet FGDs of 98%, representing an increase of three percentage points over the maximum percentage removal assumption used in the version of IPM on which EPA relied in developing the PTR. Compare IPM v.4.10 Documentation at 5-2 with EPA, "Updates to EPA Base Case v.3.02 EISA Using the Integrated Planning Model" ("Base Case v.3.02 TSD") at 8 n.3 (July 2010), Docket ID No. EPA-HQ-OAR-2009-0491-0052, available at http://www.epa.gov/airquality/transport/tech.html. EPA does not provide an explanation or any justification for this upward revision in assumed wet FGD removal efficiency, other than to say that, in transferring data from the EIA's Form 767 for use in IPM v.4.10, "changes were made." Base Case v.4.10 Documentation at 5-2. EPA states further that, in modeling the effects of installing wet FGDs, EPA assumed that the new scrubbers would operate at maximum efficiency. Id. ("existing units that are selected to be retrofitted by the model with [wet] scrubbers are given the maximum removal efficienc[y] of 98% . . . . Potential (new) coal-fired units built by the model are also assumed with a [wet] scrubber achieving a removal efficiency of 98% . . . ."). In the absence of a more explicit explanation by EPA, commenters can only presume that this is an assumption of continuous control efficiency of 98%. It is unreasonable for EPA to assume that new FGDs will always operate at maximum efficiency, regardless of the percentage of SO2 that is estimated to be removed at maximum efficiency. Equally important, the level at which EPA assumes wet FGDs will operate -- 98% -- is unrealistic. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.13-14]
A recent study of the best-performing FGD equipment -- evaluating the removal performance of the ten lowest SO2 emitting units nationwide -- concluded that "none of these `top performing' wet FGD systems was able to achieve a removal efficiency of 98% or greater in every month of the year." See Cichanowicz, J.E., "Overview of Information on Projected Control Technology Costs and Performance as Developed for EPA's Integrated Planning Model (IPM)," at 4 (Oct. 15, 2010) (hereinafter "Cichanowicz Report") (quoting Weilert, C.V., et al., "Emissions Control Performance Achieved in Practice by Electric Utility FGD Systems in the United States," at , proceedings of the 2010 Power Plant Air Pollutant Control MEGA Symposium (Aug. 30-Sept. 2, 2010, Baltimore, Maryland)). In fact, the available data suggest that even top-performing wet FGD units are unable to achieve consistent, annual average reduction levels of more than perhaps 95% to 96% SO2 removal. Id. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.14]
EPA's assumption that the "new" scrubbers that IPM projects will be installed in the coming years will operate continuously and consistently at 98% efficiency -- a level perhaps 2 to 3 percentage points above the efficiency level that they may be likely to actually achieve on an annual average -- will result in an insufficient number of allowances being allocated to units projected to add new FGD. Thus, based on EPA's proposal, units projected to be retrofit with wet scrubbers will have insufficient allowances at the start of each control year and will be forced to purchase allowances to make up the difference. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.14]
This effect of EPA's unrealistic assumption regarding the removal efficiency of new wet FGDs is exacerbated by the fact that EPA proposes to reduce allowance allocations by 3% to create an allowance set-aside for new units before distributing allowances to existing units. See 75 Fed. Reg. at 45309/1. Given that EPA plans to set aside 3% of each state's allowance budget for new units and distribute the remaining 97% among existing units, the Agency should be all the more careful to avoid making unrealistically aggressive assumptions regarding removal efficiency. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.14-15]
EPA should adjust its assumption regarding the control efficiency at which new scrubbers will operate to reflect a more realistic annual-average maximum-removal assumption of 95% to 96% and recalculate state budgets and unit-level allocations accordingly. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.15]
Units with Generating Capacity Less than 100 MW Cannot Properly Be Assumed To Be Candidates for Installation of FGD or SCR. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.15]
EPA explains in its Base Case v.4.10 Documentation that IPM v.4.10 assumes that units with generating capacities between 25 MW and 100 MW are candidates for installation of FGD and selective catalytic reduction ("SCR"). However, in the base case for the PTR, EPA assumed that "coal-fired EGUs under 100 MW capacity [did] not have the option of retrofitting FGD or SCR." Base Case v.3.02 TSD at 20 (emphasis added). EPA fails to provide any plausible explanation for changing this assumption. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.15]
In fact, EPA's new assumption that units with capacities between 25 MW and 100 MW can be retrofit with FGD and SCR is unrealistic. In many cases, it is impossible to retrofit units with capacity below 100 MW with FGD and SCR. And in cases where it is technically possible to do so, it would rarely, if ever, be cost-effective. EPA acknowledged in its Base Case v.3.02 TSD that "FGD and SCR retrofits to such small units are very costly in any case." Id. The emission reduction (and air quality improvement) benefits to be gained from such a large expense are quite limited due to the low emission amounts from "such small units." Thus, even in cases where below-100 MW units theoretically could be retrofit with FGD or SCR, it would not be an economic choice to do so, at least in the great majority of cases. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.15-16]
EPA should recalculate its base case emission inventories to remove the assumption that small units, with capacities between 25 MW and 100 MW, can be retrofit with FGD and SCR. At a minimum, EPA should explain its reasoning for changing its assumption regarding small unit retrofits in the NODA. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.16]
EPA May Well Be Understating SCR Capital Costs. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.16]
UARG supports EPA's decision to retain Sargent & Lundy ("S&L") to estimate control technology costs for the Proposed Transport Rule based on S&L's database of component costs and installation charges. Using a firm that specializes in determining the average costs of installation, operation, and maintenance of electric power generation and emission control equipment is likely to produce data that is more accurate than if EPA had pursued certain other cost-estimation approaches. See Cichanowicz Report at 1. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.16]
Although UARG believes that many of S&L's cost estimates are reasonable and likely to be accurate, or close to accurate, see generally id., S&L's projected capital cost of adding SCR appears likely to be an underestimate. See id. at 7-9 (describing differences between S&L's estimates and those provided as a result of a recent UARG survey and discussing possible reasons for those differences). [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.16]
This apparent underestimate of SCR costs can affect the calculations and assumptions on which EPA relies in the Proposed Transport Rule, including the creation and evaluation of cost curves in EPA's multi-factor analysis for determining emission reduction obligations under the PTR and the selection of "breakpoints" for emission controls, based on the cost curves. Furthermore, the S&L estimates reflected in the NODA differ from the control cost estimates that EPA used for its analyses in the PTR. EPA's use of these different cost estimates will affect EPA's analyses, regardless of whether the new cost estimates are more or less accurate than the estimates used for the PTR. See also section VII infra. EPA should therefore revise its analyses using appropriate control cost estimates and allow for public comment on the results. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.17]
EPA's Revised NEEDS Database and IPM Platform Still Contain Numerous Errors and Have Introduced Additional Inaccurate Assumptions. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.17]
As discussed in section VIII of UARG's comments on the PTR, NEEDS v.3.02 and IPM v.3.02 contained many inaccurate inputs, in the form of errors in NEEDS, inaccurate IPM constraints, and inaccurate outputs. Despite the limited time provided for UARG members to check the accuracy of the "updated" NEEDS v.4.10 and IPM v.4.10, UARG and its members have discovered that it appears that EPA has introduced additional errors and inaccurate assumptions in the updated versions, while leaving many earlier problems uncorrected. As illustrated by the discussion in section V.A supra, certain systemic adjustments to EPA's assumptions regarding new FGD control efficiencies are inconsistent with real-world experience and would result in inadequate allowance allocations. Moreover, unit-specific examples of changed assumptions are provided below. In addition to the same categories of errors and assumptions catalogued in UARG's comments on the PTR, new assumptions in IPM v.4.10 regarding fuel prices and the cost of control technologies appear to have resulted in a new  category of errors -- errors related to, for example, the retirement of coal-fired units and the controls that existing units are projected to install. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.17-18]
Examples of errors and incorrect assumptions in NEEDS v.4.10 include: [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.18]
NEEDS v.4.10 reports that Units 1-3 at the Baldwin Energy Complex in Illinois are currently equipped with wet FGD systems. That is incorrect. As a result of a consent decree, Unit 1 is required to install a dry FGD system by the end of 2011, Unit 2 is required to install a dry FGD system by the end of 2012, and Unit 3 is required to install a dry FGD system by the end of 2013. NEEDS also assumes a 98% removal efficiency for wet FGD, which, for reasons set forth above, could not be assumed to be achievable on an annual basis even if these units were to install wet rather than dry FGD. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.18]
NEEDS v.4.10 reports that Units 1-3 at the Baldwin Energy Complex in Illinois are currently equipped with cold-side electrostatic precipitators ("ESPs") and baghouses. This is incorrect. Although these units are currently equipped with ESPs, Unit 1, Unit 2, and Unit 3 are not required to construct baghouses until the end of 2011, 2012 and 2013, respectively. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.18]
NEEDS v.4.10 reports that Units 1 and 2 at the Baldwin Energy Complex in Illinois have an uncontrolled NOx rate of 0.0723 lb/mmBtu. Based on continuous emission monitoring system ("CEMS") data previously reported to EPA, the uncontrolled rate of these units is 0.61 lb/mmBtu. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.18]
NEEDS v.4.10 reports that Unit 9 at the Havana Station in Illinois has an uncontrolled NOx rate of 0.0723 lb/mmBtu. Based on CEMS data previously reported to EPA, the uncontrolled rate of this unit is 0.61 lb/mmBtu. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.18]
NEEDS v.4.10 reports that Unit 2 at the Ghent facility in Kentucky had an SCR installed as of 2009. That unit does not have an SCR, and installation of SCR is not planned at that unit. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.18]
NEEDS v.4.10 reports that two units at the Armstrong power station in Pennsylvania have installed selective noncatalytic reduction ("SNCR"). A Mobotech Rotamix system was installed in 2003 in an effort to reduce NOx, but the equipment was ineffective and was removed. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.18]
NEEDS v.4.10 reports FGD removal efficiency at the Mitchell power station in Pennsylvania as 99.9% and at the Pleasants power station in West Virginia as 97%. These removal efficiencies are incorrect. Actual removal efficiency at the Mitchell power station averages 97% and actual removal efficiency at the Pleasants power station averages 95%. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.18-19]
Examples of errors in IPM outputs and erroneous IPM inputs include:  [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
IPM v.4.10 reports in both the TR_SB_Limited_Trading parsed files that the primary fuel for Units 1 and 2 at the Danskammer power station in New York is natural gas. The primary fuel for both units is oil. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
IPM v.4.10 reports in both the TR_SB_Limited_Trading parsed files that the primary fuel for Units 1 and 2 at the Roseton power station in New York is natural gas. The primary fuel for both units is oil. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
IPM v.4.10 reports NOx controls for Unit 4 at the Scherer power station in Georgia consisting of low NOx burners and separated overfire air. This is inaccurate -- only overfire air is installed at that unit. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
IPM v.4.10 reports in the 2014 TR_SB_Limited_Trading parsed file that the coal-fired Unit 3 at the Sibley power station in Missouri will retire early. SCR was installed in 2009, making it highly unlikely that the unit will retire in or by 2014. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
:: IPM v.4.10 reports in the 2014 TR_SB_Limited_Trading parsed file that the coal-fired Mount Tom power station in Massachusetts will retire early. Dry FGD was installed in 2009, making it highly unlikely that that facility will retire in or by 2014. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
IPM v.4.10 reports in the 2014 TR_SB_Limited_Trading parsed file that the coal-fired Unit 4 at the Indian River power station in Delaware will retire early. Installation of dry FGD is planned for 2012, making it unlikely that the unit will retire in or by 2014. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
The specific errors cited above are provided as examples of the types of mistakes found in the updated NEEDS and IPM modeling -- they represent a mere sampling of the problems found by electric generating companies. In order to provide an adequate opportunity to comment on proposed unit-level allowance allocations, EPA should correct these errors and publish a revised allocation table for comment. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.19]
In addition to the flawed IPM outputs for specific units, other outputs provided on a regional scale in the IPM Run  -  TR SB Limited Trading v.4.10  -  Summary Report do not seem plausible and call into question the accuracy and validity of the modeling results. Two examples are (1) IPM's forecast for additional wind generation by 2015 and (2) IPM's projected SO2 allowance price. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.19-20]
As mentioned above, the IPM Run  -  TR SB Limited Trading  -  Summary Report projected 23.7 GW of new generation capacity from coal and 2.3 GW of new generation capacity from wind in 2015. The IPM Run  -  TR SB Limited Trading v.4.10  -  Summary Report projects only 2 GW of new generation capacity from coal and 22 GW of new generation capacity from wind in 2015. The magnitude of the projected increase in predicted new wind generation between successive versions of the model calls into question the validity of the model results. In any event, even if there is some "logical" justification for IPM's projection of 22 GW of new wind generation, there are certain practicalities that make that projection doubtful. As of January 1, 2010, the total installed wind generation capacity in the United States stood at 35 GW. IPM predicts that 21 of the 22 GW of projected new wind generation will be online by 2012. Thus, the additional wind generation that EPA projects would constitute a 60% increase in the United States capacity in approximately three years. Considering that the average-sized wind farm in 2009 had generation capacity of 91 MW, that would mean that approximately 231 average sized wind farms would have to be permitted and built by 2012. According to the American Wind Energy Association, it takes approximately 18 months to two years to permit and build even relatively small (50 MW) wind farms. The dramatic change in generation mix between successive versions of IPM and practical considerations of actually permitting and building that many new wind farms in a very short period call for explanation and additional justification by EPA of this very substantial change in its projections. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.20-21]
Finally, the IPM Run  -  TR SB Limited Trading v.4.10  -  Summary Report provides estimates of SO2 allowance prices for group 1 and group 2 states at $313 and $184, respectively. Although it is not possible to compare these prices to projections from the IPM Run  -  TR SB Limited Trading  -  Summary Report because allowance price projections were not provided in that report, a report by James Marchetti for the Midwest Ozone Group ("MOG") and submitted with MOG's comments on the NODA notes that the cost in 2015 of SO2 allowances in a group 1 state under an intra-state-only trading regime was estimated at approximately $1,900 per allowance. At best, this analysis demonstrates that the IPM projection of 2015 SO2 allowance prices is considerably underestimated. At worst, this analysis suggest a flaw in IPM's methodology. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.21]
In Making the Changes Represented in the NODA, EPA Continues To Ignore the Effects of CAIR and Local Controls. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.21]
EPA indicates that IPM v.4.10 takes into account all existing federal and state air emission regulations (except for CAIR), as well as new source review ("NSR") and other settlements, that were in effect or were final as of August 2010. Base Case v.4.10 Documentation at 1-1.21 By contrast, the previous version of IPM, used to model the PTR, took into account these same factors effective as of February 3, 2009. 75 Fed. Reg. at 45243/2. Despite this updating by about 18 months with respect to EGU emission limitations, EPA in the NODA improperly continues to ignore the effects of CAIR and local emission controls, including controls affecting emissions from non-EGU point sources and nonpoint stationary sources. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.21-22]
EPA Should Have Considered the Effects of CAIR. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.22]
As UARG explained in its comments on the PTR, EPA should have included CAIR in its base case modeling because it remains binding law until it is replaced by a valid rule. See UARG's PTR Comments at 50-53. According to the terms of the D.C. Circuit's December 2008 opinion on rehearing in North Carolina v. EPA, CAIR will remain binding law until a new rule is in place. Thus, it is appropriate for EPA to conclude in this rulemaking that there will be no time when neither CAIR nor a CAIR replacement rule will be in effect. See id. at 50-51. Additionally, EPA has not demonstrated that EGUs in the few states that were regulated under CAIR but may not be regulated under the Transport Rule, as proposed, are likely to increase their emissions when CAIR expires, or that such increases would be permitted under state law. In reality, these EGUs have already made reductions pursuant to CAIR and it is very unlikely that they will increase their emissions to pre-CAIR levels once CAIR expires. Based on these factors, as well as the downward trend that EPA has acknowledged in PM2.5 and ozone concentrations nationwide,22 it is far more realistic to assume that CAIR applies than it is to assume that it does not. See UARG's PTR Comments at 52-53. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.22-23]
EPA Should Have Considered the Effects of Local Controls. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.23]
UARG also explained in its comments on the PTR that EPA's proposal improperly failed to account for local emission controls. Section 107(a) of the CAA states that "[e]ach State shall have the primary responsibility for assuring air quality within the entire geographic area comprising such State." 42 U.S.C. § 7407(a). See UARG's PTR Comments at 64-66. Thus, EPA's proposal to promulgate and implement a rule that regulates sources of transported pollutants without considering the effects of local controls, see 75 Fed. Reg. at 45226/3, is contrary to the Act. EPA attempted to explain its failure to account for local controls in the PTR by asserting that "nonattainment areas for the 1997 PM2.5 and ozone standards were not announced until 2004 and 2005 respectively, and the corresponding [SIPs] were not due until 2007 and 2008, thereby preventing the inclusion of these local measures in the 2005 emissions inventory." EPA, "Emissions Inventories" TSD ("Emissions TSD") at 11 (June 2010), Docket ID No. EPA-HQ-OAR-2009-0491-0050, available at http://www.epa.gov/airquality/transport/tech.html. As UARG noted in its comments on the PTR, however, the unavailability of this information in 2005 does not explain EPA's failure to account for it in its future base case projections. See UARG's PTR Comments at 65 n.39. Again, despite the many updates reflected in the NODA, EPA fails to account for local controls. EPA must consider the effects of local controls on its modeling and on air quality and attainment and interference with maintenance of the NAAQS.  [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.23]
Moreover, even if one were to accept that EPA had insufficient time to account for local controls in the entire proposed control region before issuing the PTR, EPA could and should have at least considered the effects of local controls on the areas surrounding the six monitors with perceived maintenance problems that led to EPA's proposed designation of the group 1 states that are subject to additional SO2 reduction requirements in 2014. See UARG's PTR Comments at 61-64 (discussing EPA's classification of group 1 states based on six monitors with perceived maintenance problems). EPA certainly has the resources to consider the effects of local controls in the areas surrounding these six monitors.23 Such consideration of local controls may have eliminated the need (as determined by EPA) for additional SO2 reduction requirements in 2014, or at least may have reduced the number of group 1 states. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.24]
The Availability of NEEDS v.4.10 and IPM v.4.10 and the Central Role These Items Play in the Structure of EPA's PTR Warrant a New or Supplemental Proposed Rule Based on the Results of the New Data and Modeling. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.24]
EPA's PTR depends in substantial measure on the validity, reliability, and accuracy of IPM. No other tool has as great an influence on key elements of the PTR. Indeed, the results of IPM runs have a direct or indirect effect on every major step in EPA's PTR methodology. In the NODA, EPA acknowledged as much by stating: [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.24]
Changes from the projections relied on in the proposed rule, from using an updated model, could impact the final rulemaking in a number of ways including, but not limited to: [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.24]
Changing emission projections that were used to determine which downwind areas have air quality concerns (i.e., non-attainment or maintenance) absent this rulemaking and to determine which States contribute to those problems. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.24]
Changing cost and emission projections used in the multi-factor [e.g., cost curve] test to determine the amount of emissions that represent significant contribution. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.24]
75 Fed. Reg. at 53614/3. If anything, EPA understates the potential impact of the updated database and platform. The NEEDS inventory and the output of IPM substantially influence the fundamental components of the PTR: the analyses of air quality; the linkages of upwind states to downwind problem areas; the definition of significant contribution to nonattainment and interference with maintenance; and the establishment of statewide budgets and unit-specific allocations. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.25]
Despite the central role of IPM in each of these components, EPA elected to provide a very limited number of runs using the updated NEEDS database and revised IPM platform and then further qualified the import of the runs by stating that "they are merely provided for informational purposes to allow commenters to understand the impact that changes in the model platform have on the projected impacts of the caps." It is unclear why EPA tries to downplay the potential impact of the updated NEEDS database and IPM platform when EPA clearly "proposes to use this version of the IPM model [IPM v.4.10] in the final Transport Rule." As discussed in section IV above, a cursory comparison of the NODA IPM runs with the PTR IPM runs demonstrates that changing the NEEDS emission inventory and using an updated IPM version result in significantly different outcomes. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.25]
UARG appreciates that entirely redoing EPA's analysis using the updated NEEDS database and IPM platform takes significant time and resources. EPA should, however, conduct its analysis using the most current model and information at its disposal, and then should make all the results available to the public and allow an adequate time for public review and comment before taking any final action in this rulemaking. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.25]
In all its complexity, EPA's PTR methodology can be broken down into approximately eight major steps. In each of these steps, IPM provides information critical to the accuracy and validity of EPA's analysis. The purpose of reviewing each of these steps is to demonstrate EPA's thoroughgoing reliance in this rulemaking on IPM and the importance of EPA undertaking a full analysis with the revised modeling tool and data, and allowing a full opportunity for public comment on the methodology and results of that analysis. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.26]
The following paragraphs describe the eight major steps in EPA's methodology, as reflected in the PTR, and discuss why these steps depend on IPM results: [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.26; See pp.26-29 of this comment summary for the eight step process in EPA's methodology]
If a state's 2012 budget was based on the IPM 2012 projection (because the state's 2012 projected emissions were lower than its actual reported emissions), then the individual allocations for units in that state were based on the projected emissions for units in the same IPM Run-Parsed File SB Limited Trading run that contained the 2012 unit-level emissions. Yet, without offering any particular explanation as to why it replicated certain portions of this step using the new IPM version even though it did not do so for earlier steps, EPA recalculated the 2014 unit-level SO2 emissions for units in group 1 states in a new "SB Limited Trading v.4.10  -  2014 Parsed File" -- but apparently limited by the original proposed state emission budgets derived from the PTR IPM-based TR_2000_SO2. Without explanation, EPA elected not to provide for public review and comment the parsed results for 2012 unit specific emissions based on the updated NEEDS database and IPM platform. [EPA-HQ-OAR-2009-0491-3773.1_NODA, pp.29-30]
As the discussion above indicates, at every major step in EPA's methodology -- e.g., creating emission inventory cases as inputs to CAMx modeling, projecting future nonattainment and maintenance problem areas, establishing linkages of upwind states to downwind nonattainment and maintenance problem areas, defining significant contribution to nonattainment and interference with maintenance, and establishing unit-specific allocations -- IPM played an indisputably critical role in ultimately determining unit-specific allowance allocations. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.30]
Although EPA states in the NODA that it proposes to use IPM v.4.10 (along with NEEDS v.4.10) "in the final Transport Rule," the NODA is unclear as to exactly where and how EPA intends to use it. EPA should clarify these issues for the public and should revisit the basis for its proposal if it intends to proceed with this rulemaking and to continue to use its proposed approach to implementing section 110(a)(2)(D)(i)(I) of the Act. In doing so, EPA should redo each step of its methodology as described above using the updated NEEDS inventory and IPM platform. EPA then should issue the results of its new analysis for public review and comment, providing an adequate comment period. [EPA-HQ-OAR-2009-0491-3773.1_NODA, p.30]
Wisconsin Power and Light Company
WPL notes that the EPA lists inclusion of the Wisconsin Mercury Rule (NR446) in the IPM 4.10 model (Chapter 3, Appendix 3-2.5). WPL does not believe that it is appropriate to include the NR446 Wisconsin Mercury Rule in the IPM modeling for CATR as it is intended to only address emissions reductions for S02 and NOx. The inclusion of this rule for CATR may result in unintended consequences in the EPA's IPM modeling, such as overestimated emissions reductions, reduced generation operation and even premature retirements that may not be reasonable assumptions. In addition, the Wisconsin Mercury Rule includes the following requirement for review upon issuance of the federal Utility MACT standard: [EPA-HQ-OAR-2009-0491-2844.1 p.5]
'NR 446.19 Evaluation reporls. (2) 1n addition to Ihe reporl required under sub. (1), the department shall report to the natural resources board within 6 months of the date of promulgation of a federal regulation under section 111 or 112 of the Act (42 USC 7411 or 7412) or the enactment of a federal law that has mercury reduction requirements for the mercury emission sources affected by this subchapter. The report shall include a comparison of the federal requirements and the requirements of this subchapter along with recommendations for revisions to this subchapter or other actions. ' [EPA-HQ-OAR-2009-0491-2844.1 p.6[EPA-HQ-OAR-2009-0491-2844.1]]
WPL reinforces that EPA must assure the accuracy of the input data for the final CATR. This includes validating generation data inputs used in EPA's integrated planning and air quality models. Utility companies nationwide have recently submitted much of the information required in EPA models as part of certified responses to the Utility Maximum Achievable Control Technology (MACT) Information Collection Request (ICR). This includes information on generation fleet operating characteristics and permitted emissions rates. WPL requests that input data and modeling used for the final CATR be appropriately updated to reflect the Utility MACT ICR database. In addition, WPL provides Table I below with corrections to the EPA's NEEDS 4.10 database. Corrected values are in the cells highlighted yellow and in red text. [EPA-HQ-OAR-2009-0491-2844.1 p.6[EPA-HQ-OAR-2009-0491-2844.1]]
Response:
Many of the above comments are centered around concerns with EPA's modeling, and the subsequent use of that modeling to determine state budgets and unit level allocations.  EPA took significant action to respond to these concerns in its final Transport Rule.
First, EPA changed its allocation methodology to be based on historic heat input and emissions data that is generally reported by the sources' DR who testifies to its accuracy and completeness.  This was done in response to comments that expressed concern/disagreement about the IPM unit level projected emissions on which the proposed allocations were based.  By switching to a historic  data based methodology, the degree to which any discrepancy between a units actual future operation and its projected future operation would impact the unit's allocation is greatly diminished.  EPA recognizes that IPM is a dynamic linear programming model that generates optimal decisions under the assumptions of perfect foresight and results in a least cost method of meeting demand.  However, invariably, there will be discrepancies between IPM unit level projections and a unit's actual future operations due to non-economic or other variables that IPM does not capture.  At the state and regional level, the discrepancies are small and random and thus do not result in biases.  However, their impact at the unit level may be significant and this was one of the drivers behind switching to an allocation method based on historic data. For more information on the allocation method, see Preamble Section VII D.
Second, EPA reviewed the comments and has made significant updates to its IPM v.3.02 modeling used at proposal.  These updates include changes to both the more general IPM assumptions (e.g., gas price assumptions) and specific unit level assumptions (e.g., that current retrofit status at a unit).  These updates were made to the IPM model, and the updated versions (EPA IPM v.4.10) was used for all the final rule analysis.  In regards to unit specific adjustments, EPA did not manually adjust projected unit level modeling outputs, but it did make unit level updated to its NEEDS database used as a model input that impacted the unit level model outputs.   Some of the most frequent general IPM comments noted above that were addressed in the updates are: FGD removal efficiency was adjusted for new retrofits, and for existing retrofits it was indexed to historic performance at the unit.  Additionally, many of the above comments were focused on a sources ability to switch coals.  EPA modified its modeling to better reflect the cost and feasibility of switching and blending coals.  State Rule and consent decrees were updated according to comments.  Additionally, there were more than 1000 unit specific modeling changes made in response to corrections provided by the commenter.  For more detailed discussion of EPA IPM v.4.10 assumptions and assumption updates, see the EPA IPM v.4.10 documentation and the "Transport Rule IPM Assumptions Response to Comments" in the Appendix
These two adjustments, updates to the modeling and updates to the allocation methodology, work in concert to comprehensively address many of the concerns expressed by commenters on their unit level projections and allocations.
Finally, EPA notes that it conducted its air quality analysis and its multi-factor analysis to determine state budgets completely anew for the final Transport Rule using the updated modeling that reflected input and corrections received from commenters.
Organization: New Jersey Department of Environmental Protection (NJDEP)
Comment:
After reviewing the data used by USEPA to support the Transport Rule, New Jersey's Department of Environmental Protection ("Department") found that the information for many New Jersey sources was not correct. More importantly, the data did not correctly reflect recent rule adoptions by the Department  -  Sulfur in Fuels (N.J.A.C. 7:27-9, August 24, 2010) and Ozone RACT (N.J.A.C. 7:27-16 & N.J.A.C. 7:27-19, March 20, 2009). Attached are two documents: NJ_EGU_Data.xls [EPA-HQ-OAR-2009-0491-3770.1_NODA] and NJ_EGU_rules.doc. [EPA-HQ-OAR-2009-0491-3770.2_NODA] NJ_EGU_Data.xls is the list of electric generating units in New Jersey that are affected by the Transport Rule. This spreadsheet contains current and future permit limits for NOx and SO2. This data should replace those that the USEPA used in the NODA. Additionally, NJ_EGU_rules.doc summarizes New Jersey's rules for EGUs, which should be included as constraints in the NODA. [EPA-HQ-OAR-2009-0491-3770_NODA, p.1]
The Department urges the USEPA to use the provided information to update the data used to support the Transport Rule, including updating the NOx and SO2 allowance allocations for the sources in New Jersey. It is very important that the analysis behind the Transport Rule be based on sound information. [EPA-HQ-OAR-2009-0491-3770_NODA, p.1]
Response:

The updated IPM modeling used in EPA's final Transport Rule analysis includes updates to NOX rate limits and SO2 permit rates in New Jersey.  See the final Transport Rule base case and policy case for emission rates observed in the analysis and the IPM NEEDS file for the SO2 permit rates imposed at specific units.  See "Transport Rule IPM Assumptions Response to Comments" for an additional listing of unit level changes made in the IPM modeling between proposed rule and final rule.

Organization: State of Wisconsin, Department of Natural Resources
Comment:
State of Wisconsin, Department of Natural Resources
EPA should not use the IPM model results to set statewide or unit specific operating levels and emissions (S02 and NOx) for the 2012 and 2013 compliance years for purposes of either emission budget or allowance allocation. The IPM model curtailed operation of a significant number of generation units based on faulty heat rate and dispatch assumptions. Rather, the 2012 and 2013 state and unit specific operating levels should be derived from historic information such as the 2009 heat input level coupled with a moderate grow1h factor or a derived average operate level. The 2009 operating year already represents a low capacity scenario for individual generating units and it is not reasonable to assume that individual unit operation can be further curtailed prior to 2014. A comparison of fuel consumptions for Wisconsin and adjacent states is provided in Attachment A. As stated under the broader comment, Wisconsin also looks to EPA to allow a different basis other than IPM outputs for allocating emission budgets for 2014 and after. [EPA-HQ-OAR-2009-0491-3803.1_NODA, p.1] [[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, pp.1-2 for Attachment A.]]
Wisconsin is providing corrections to technical assumptions and data for individual generation units, as provided in Attachment B, for application to the NEEDs input data and IPM modeling effort. [EPA-HQ-OAR-2009-0491-3803.1_NODA, p.1] [[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, pp.3-12 for Attachment B.]]
I.    Comments to General IPM assumptions
-Generation Unit Heat Rates  -   The heat rate or the efficiency of converting fuel to electricity appears to be a key parameter in IPM determining the dispatch order for operating units.....especially coal fired generation.  As shown in Table 1 review of the heat rates in the NEEDs database indicates significant inconsistencies for specific generation units when compared to other data sources including previous versions of the NEEDs database and the 2009 Acid Rain database.  The presented Acid Rain heat rate is calculated from gross generation and heat input reported to the Clean Air Markets Division database.  [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.4]
Even if not a similar basis to NEEDs 4.10 heat rates ('net' versus 'gross'), the alternative heat rates illustrate the impact that relative heat rates can have on unit dispatch order.  In Table 2 the larger coal fired units are compared.  Sorting by most to least efficient heat rates yields a significantly different dispatch order.  One particular example, is for the Columbia 2 plant which under IPM 4.1 has operation curtailed because the assumed heat rate puts the unit far down the list.  In comparison, the Acid Rain based heat rates have the Columbia 2 unit much further up the list in comparable efficiency.  This latter dispatch order is more consistent with the relative operating levels seen between Wisconsin units in 2009.  At a minimum Wisconsin requests EPA to review and correct heat rates for coal and combined cycle generation units with a difference greater than 5% as shown in Table 1.  Some units even appear to have a default assumed heat rate which are not adequate.  The bottom line is that assigning the correct heat rate is essential for effective representation of unit operation by the IPM model.  [EPA-HQ-OAR-2009-0491-3803.2_NODA,p.4] [[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, p.6 for Table 1 and p.8 for Table 2.]]
Detailed generating unit information addressing the following comments is provided under the section 'Specific Comments to Individual Wisconsin Generating Units'  [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.4]
-Units missing from the emissions budget and allocation determination  -  Several generation units feed generators greater than 25 MW but are not included as Transport Rule generation units (Table 3).  [[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, p.7 for Table 3.]]
-Existing and Committed Controls - EPA intends the IPM model to capture controls committed by 2012.  These controls are best reflected by first considering actual 2009 / 2010 emission rates.  For NOx the emission rates should be derived from operation during the ozone season whereas SO2 emission rates should be derived from annual data.  Where emission limitations are in place requiring post-combustion controls these limits should be in place of the actual emissions.  To this intent, emission rates and limits are provided in Table 4 for changes necessary to the NEEDs and IPM databases.  Also shown are applicable changes in later years reflecting controls available by 2012 and final NOx RACT requirements by the 2013 ozone season for EGUs in Wisconsin's ozone non-attainment counties. [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.4][[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, p.9 for Table 4.]]
-Control options assumed available under IPM for 2012 - EPA appears to include low NOx burner installations in additional cases by the 2012 timeframe.  The intervening timeframe appears too short, especially, when considering energy agency approvals and coordination of installation of multiple units over the available outages.   [EPA-HQ-OAR-2009-0491-3803.2_NODA, pp.4-5]
Another control option that appears overstated is the ability to switch from higher to lower sulfur fuels.  EPA should consider that, where practical, utilities have probably applied this option in response to CAIR 2010 to 2012 SO2 requirements.  The case of switching from bituminous to subbituminous coals typically requires equipment modification and additional safety measures that may take several years to achieve.  Even in the case where boilers are already burning a mixture of coals there is a threshold where additional equipment changes are probably needed.  EPA did not account for this technical issue.  In addition, boilers may not be designed for the lower Btu fuels and loose efficiency.  In fact some units in Wisconsin, such as Genoa, burn a specific mixture of bituminous and subbituminous coal in order to optimize the unit heat rate.  EPA also assumes that utilities burning subbituminous coals can obtain the cleanest of subbituminous coals.  This requires utilization of a limited number of mine sources and delivery options which is difficult to see happening by 2012 and 2013.   [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.5]
On the whole EPA should not consider any level of fuel switching options to reduce SO2 emissions for the 2012 timeframe.  Wisconsin generation units with artificially low SO2 emission rates are identified in Table 5 along with their actual 2009 emission rate.  [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.5] [[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, p.10 for Table 5.]]
-Actual vs. Permitted SO2 emission rates  -  In predicting future emissions IPM increases SO2 emission rates for certain generation units when compared to current actual operations.  This appears to be based on IPM switching to lower cost fuel as allowed under the units permitted limit for SO2.  In this case a specific unit is provided a benefit at the cost of controls placed on other generation units.  For generation units shown in Table 6 the SO2 emission rates should be changed to reflect the 2009 emission rates.  [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.5] [[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, pp.10-11 for Table 6.]]
-Fixed Capacity Units  -  There are a number of generations units which have dedicated purposes not reflected in the IPM results including: grid support, district heating and cooling, and units with committed controls for long term operation.  EPA needs to consider these units, as listed in Table 7, with minimum proposed operating levels.   [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.5] [[See Docket Number EPA-HQ-OAR-2009-0491-3803.2_NODA, pp.11-12 for Table 7.]]
-Installation Timeframes  -  The EPA assumes standard timeframes for the installation of different types of control equipment.  These timeframes also need to account for processes for approval to build the equipment from state agencies which have regulatory over-sight.  For example, a public utility in Wisconsin must have approval from the Wisconsin Public Service Commission in order to recover cost via the electric rate base.  This approval process in the past has taken up to a year when the requirement is clear-cut.  And in the case of capital intensive equipment such as FGDs and SCRs this process can extend even longer.  And in many cases such approval processes cannot be entered until EPA promulgates the final Transport Rule. [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.5]
-Wisconsin Mercury Requirements  -  EPA incorporates a constraint into IPM for the Wisconsin state mercury rule which requires 90% reduction by 2015.  This rule also provides an alternative mercury reduction schedule if implementing significant NOx and SO2 controls.  It is not apparent from the documentation, but controls for NOx and SO2 should not be placed as an IPM constraint under the state rule  [EPA-HQ-OAR-2009-0491-3803.2_NODA, p.5]
Response:
EPA has revised its allowance allocation methodology in response to concerns expressed by commenters.  The unit level allocations no longer rely on IPM modeling.  See section VII.D of the preamble for a description of the final Transport Rule allocation methodology.  EPA also made updates to its model where it received comments with well documented corrections that would have a significant impact on the model.  The final rule analysis was conducted with the models updated to reflect corrected data submitted in the comment period.  See EPA IPMv.4.10 documentation and the RTC Appendix for more details on IPM modeling adjustments in response to comments.
EPA does rely on modeling projections at the state level for determining state budgets.  As many commenters noted, the model is much more accurate at this level and therefore appropriate to use for determining state and regional projections.  EPA's IPM model contains over 13 million variables, and while discrepancies between the variables as modeled and as reflected outside of the model could have significant impacts at the unit level, they are generally muted at the state and regional level due to the large sample of units being analyzed at that level.  Therefore, EPA feels it is appropriate to use the IPM model to determine state level budgets.  Furthermore, there are a lack of viable alternatives for determining state budgets; recent historic data would not work as it reflects operations under CAIR policy constraints and EPA is developing state budgets independent of CAIR budget or emission levels as the Court determined the rule to be illegal.
In regards to the Wisconsin state mercury rule, EPA only models Hg constraints from this particular rule.  There are NOx constraints reflected in the rule stemming from the separate state rule requirements under NR 428 Adm Code.
Organization: we energies
Comment:
we energies
Second, the NEEDS database contains factual errors regarding We Energies coal fleet. In particular, the database does not properly reflect the addition of flue gas desulfurization and selective catalytic reduction equipment on South Oak Creek units 5  -  8. This omission is significant and would likely have a dramatic effect on the modeling in our region. [EPA-HQ-OAR-2009-0491-2629.1, p.3]
Response:
These controls at South Oak Creek are all reflected in EPA's updated base case modeling.  However, they are not incorporated into the NEEDS database as they are not expected to be installed (as noted by the commenter) prior to January 1, 2012.
Organization: Westar Energy, Inc.
Comment:
Westar Energy, Inc.
On behalf of Westar Energy, Inc., this letter is to request an extension of time to provide comments on the 'Clean Air Transport Rule,' 75 Fed. Reg. 45210, and on the 'Notice of Data Availability,' 75 Fed. Reg. 53613. Currently, comments on the Rule are due October 1, and comments on the NODA are due October 15. We request an extension to allow the filing of a single set of comments on both aspects of the rulemaking, to and including November 30, 2010. [EPA-HQ-OAR-2009-0491-1924.1, p.1]
As noted in the docket, the proposal for rulemaking is based on complicated modeling as to the upwind sources that are contributing significantly or interfering with the maintenance of downwind sites. Because the proposed rules will have significant service, cost, logistical, construction, and operational impacts on Westar and affected electric generating units (EGUs), We star has undertaken to analyze the modeling used in the rulemaking. The publication of the NODA has severely impacted that analysis. Since EPA did not conduct modeling in support of the NODA, any attempt to understand how the NODA will impact the conclusions that EPA reached prior to the NODA requires the input of the NODA data set into the modeling. Due to the complexity of the modeling, inputting and analyzing that new data and its impact will take a matter of weeks to complete. In addition, other new data was received from EPA on September 14, correcting a corrupt model-ready emissions file. Currently, and despite Westar's best efforts, it appears that it will be extremely unlikely, if not impossible, to incorporate the new data into the modeling in a timely fashion that will allow Westar to file comprehensive and meaningful comments which should be considered by EPA. [EPA-HQ-OAR-2009-0491-1924.1, pp.1-2]
Westar and other EGUs in states identified for the first time by EPA as subject to the proposed Air Transport Rule, face an especially difficult burden to prepare and file comments as to the potential impacts that the Rule will have on them. In contrast to EGUs in states previously subject to clean air transport rules, Westar and other EGUs in 'first time states' have no historical basis on which to ground their analyses, nor were they invited to 'listening sessions' as to what direction EPA proposed to take in the rulemaking docket to which other stakeholders from states previously subject to clean air transport regulations were invited. [EPA-HQ-OAR-2009-0491-1924.1, p.2]
We star is currently working to understand the full significance of the proposed rule to Westar and other EGUs in the State. Through EPA's docket, Westar has obtained and is reviewing EPA's background documentation including modeling information. As a result of the new information in the NODA, these efforts have been hampered by creating a 'moving target' that impedes these efforts to evaluate the applicability and potential impacts of the proposed rules on Kansas and Westar. [EPA-HQ-OAR-2009-0491-1924.1, p.2]
These issues have created an almost impossible situation for We star to respond in a full and meaningful manner by the current October 1 and October 15 deadlines, particularly given We star's and Kansas' status as 'first time state' affected by the proposed rule. In addition, the rulemaking record would be better served by a single set of comments that address comprehensively the new and old data. To assure a full and meaningful comment period consistent with statutory and regulatory intent, additional time to comment is appropriate. Accordingly, Westar requests that EPA replace the current comment dates and grant an extension to and including November 30,2010 for a single set of comments to address all matters raised by the original Notice and the NODA. [EPA-HQ-OAR-2009-0491-1924.1, p.2]
EPA HAS NOT ALLOWED SUFFICIENT TIME FOR MEANINGFUL REVIEW AND COMMENT ON ITS PROPOSED RULE AND ADDITIONAL TIME IS NEEDED FOR ADEQUATE RESPONSE. [EPA-HQ-OAR-2009-0491-3737.1_NODA, p.5]
Through the NODA, EPA has added to an already overwhelming volume of information upon which any eventual decision will be made. Yet final determinations on important issues such as the inclusion of states including Kansas in the CATR rule, and any determination of state budgets or unit-specific allocations are lacking. Westar and other parties have requested an extension of time for response, to and including November 30, 2010, but that request had not been acted on by EPA when those comments were filed. The volume of new and changed information provided by EPA and the omissions and erroneous conclusions of EPA identified by Westar and other parties create the need for an additional comment period by EPA after providing more specific information upon which any final rule may be based. EPA's failure to provide results of the impact of the new information in the NODA as it affects Kansas, by completing modeling runs and providing results of modeled impacts and state budgets and source allocations is fatal to the ability of Westar and other parties to meaningfully review and comment on EPA's proposal. The examples provided by Westar and others of EPA's failure to recognize existing federally-enforceable control requirements on Kansas sources, including Westar's Jeffrey Energy Center and the La Cygne facility, are examples of the lack of fully developed evaluation which should be included in any final rulemaking. Coupled with the inadequacy of EPA's modeling tool, there is not a sufficient basis for a final rule. [EPA-HQ-OAR-2009-0491-3737.1_NODA, pp.5-6]
Response:
EPA appreciates the comment and has updated its IPM modeling to include the federally enforceable requirements under the Westar Consent Decree and the requirements for the Ly Cynge facility.  See EPA IPMv4.10 Documentation as well as the RTC Appendix "Transport Rule IPM Assumptions Response to Comments" for a further description of such changes made in the final IPMv.4.10 used in the final Transport Rule analysis.
Organization: Xcel Energy Inc.
Comment:
In version 4.1 of the NEEDS database, EPA has mischaracterized Bay Front Units 1 and 2 as biomass fuel units. In actuality Units 1 and 2 burn biomass as well as coal and natural gas. Xcel Energy requests that EPA identify Bay Front Units 1 and 2 as coal units and not as biomass units. This database also lists the particulate control devices for these units as baghouses, when in fact they both use electrified filter beds for particulate control. [EPA-HQ-OAR-2009-0491-2728.1, p.6]
Xcel Energy also noted that in NEEDS version 4.1 EPA has mischaracterized Bay Front Unit 5 as a biomass fuel unit. This unit is currently a coal-fired unit and is expected to remain so during at least the early years of the CATR program. Xcel Energy believes this mischaracterization is a result of EPA using data from a Northern States Power Wisconsin (NSPW) filing in 2009 with the Wisconsin Public Service Commission ("WPSC") where NSPW proposed converting Bay Front Unit 5 to a biomass gasifier unit. Xcel Energy has asked the WPSC for an additional six months to evaluate other alternatives as a response to increased costs since the project was proposed. As a result, EPA should show this unit as coal-fired instead of biomass-fired. [EPA-HQ-OAR-2009-0491-2728.1, p.6]
Response:

See "Transport Rule IPM Assumptions Response to Comment" document for a list of unit level changes made in IPM between proposal and final based on input from commenters.  This particular facility already operates primarily on biomass fuel according to the most recent EIA form 923 data from 2010.  Both the comment and independent analysis conducted during periodic model updates suggest that the facility will likely continue this pattern, as conversion plans for the third unit have been announced that would allow 100 percent biomass use at the facility.  This would potentially be complete in the first year of Transport Rule compliance.  Accordingly, the IPM modeling used for the final Transport Rule unit identifies these units as biomass sources.

XIX. Transport Rule 2 and Other Future Transport Rulemakings

Organization: 8-Hour Ozone State Implementation Plan (SIP) Coalition
Comment:
8-Hour Ozone State Implementation Plan (SIP) Coalition
Future Assessment of Transport Impacts From EGU and Non-EGU Sources  The Coalition is concerned about EPA's plans to apply this rule's technical analysis and framework to an analysis of the potential role of non-EGU sources on downwind areas in 2011, and a re-examination of the sufficiency of this rule for EGUs after new NAAQS are adopted.  A thorough examination of the utility of this approach to assessing transported emissions from industrial sources must be performed before any future determinations can be made with respect to transport for the following reasons. [EPA-HQ-OAR-2009-0491-2736.1, p. 4]
1) EPA uses the IPM to assess various control scenarios and as the basis for its cost and feasibility analyses underlying the TR.  No comparable tool exists for non-EGUs.   [EPA-HQ-OAR-2009-0491-2736.1, p. 4]
2) Emissions from the diverse equipment and units that make up petrochemical and refining facilities are mostly emitted at or near ground level.  Stack heights for those emissions that come from non-EGU stacks are shorter than those found in EGUs.  Therefore, the assumptions that underlie the long-range transport of emission plumes from EGUs cannot apply to petrochemical and refining facilities.  EPA will need to re-examine this aspect of the modeling analysis. [EPA-HQ-OAR-2009-0491-2736.1, pp. 4-5]
3) EPA should use the most current years of data for an analysis of affected nonattainment or maintenance areas.  For example, in the TR, the entire state of Louisiana is brought in to the TR because of a small modeled impact on PM2.5 annual levels at the Clinton Drive monitor in Houston.  However, for the past three years, emission levels at this site have been trending downward, and EPA has determined that the area will not be designated as nonattainment.  Other areas may face similar situations. [EPA-HQ-OAR-2009-0491-2736.1, p. 5]
4) Cost profiles are different for EGUs and non-EGUs.  In many states with mature nonattainment SIP programs, petrochemical and refining facilities (and in the Houston region, EGUs) have installed numerous control strategies to reduce emissions for local nonattainment problems.  In addition, many sources have installed controls in compliance with consent decrees and other programs.  Thus, there may not be any remaining "highly cost effective" controls available.  EPA's own analysis throughout the rule proposal concurs with this assessment. [EPA-HQ-OAR-2009-0491-2736.1, p. 5]
5) EPA's modeling approach includes all of the emissions in a state from all source categories to determine if one state's emissions significantly affect a downwind area.  But in many cases, point sources are not the major source of emissions.  The analysis presented by EPA does not present a demonstration that an individual sector's emissions specifically cause or contribute to nonattainment in a downwind area.  If this rule is broadened in the future to include more EGUs and non-EGUs EPA should instead develop a methodology that tests the significance of the particular source category on a downwind state. [EPA-HQ-OAR-2009-0491-2736.1, p. 5]
6) In other tests to determine if a source causes or contributes significantly to interference with maintenance (as in the Prevention of Significant Deterioration programs), EPA uses a Significant Impact Level of 4% of the NAAQS level.  The Coalition supports the use of this 4% Significant Impact Level for any rulemakings wherein EPA intends to evaluate the significant contribution of point sources. [EPA-HQ-OAR-2009-0491-2736.1, p. 5]
7) The Coalition also believes that the photochemical models as used in the rulemaking are not sufficiently precise to examine changes in precursor emissions that could affect as minute a level as 1% of the NAAQS for PM2.5 and ozone.  A 4% significance level would better fit the purpose and precision that the model can be expected to achieve. [EPA-HQ-OAR-2009-0491-2736.1, p. 5]
Response:
As noted in the preamble, EPA believes that the broad framework for evaluating significant contribution and interference with maintenance outlined in this rule is applicable to future NAAQS as well.   However, EPA is not taking any final action at this time to apply this framework to any future NAAQS and additional technical analysis would be necessary to do so.  Given the collective nature of emissions contributions, EPA disagrees that it is necessary to demonstrate or test the significance of each particular source category.
See preamble section V.D.1 for discussion of EPA's choice of the 1 percent threshold.
Organization: Adirondack Council
Comment:
Adirondack Council
We urge EPA to use a stronger baseline for NOX emissions than the 1997 National Ambient Air Quality Standards (NAAQS). At a minimum, EPA should use the more stringent 2008 standard, and update the Transport Rule when a new standard is put in place, hopefully later this year, although that is now uncertain and litigation may also slow this process. [EPA-HQ-OAR-2009-0491-2848.1, p.2]
Response:
See discussion in preamble section IV.C.1.
Organization: Ameren Services Company
Comment:
Ameren Services Company
EPA should abandon this rule making in light of the soon to be revised Ozone and PM25 standards
EPA in the preamble to this rule indicates that a follow on to this rule will be necessary when EPA revises the 8-hour ozone and PM25 standards currently under reconsideration. From the results described above EPA needs to abandon this rule making as the existing standards will be attained with on the books controls and the continuation of CAIR. When EPA revises theses standards at that time EPA should reanalyze the current ambient levels and emissions using the most up to date information available. Then only after going thru a thorough analysis, propose emission reductions that are beneficial to areas not meeting the standards. [EPA-HQ-OAR-2009-0491-2722.1, p.26]
Response:
EPA has an obligation to address the concerns raised by the court over the CAIR in an expeditious manner.  In light of the court decision in North Carolina, the CAIR cannot remain in force indefinitely.  Moreover, this rule provides for substantial benefits to public health and the environment in the near term.
While there will be a need to address statutory requirements for any future NAAQS, EPA disagrees that this rule should be abandoned.
Organization: American Lung Association
Comment:
American Lung Association
[These comments were submitted as testimony at the Atlanta, Georgia public hearing on September 1, 2010.  See Docket Number EPA-HQ-OAR-0491-1939, pp.15-16.]
Right now, under the proposed rule, you've identified 10 states that contribute a significant portion of the ozone and particulate matter in Georgia. But you'll find that only -- you find that only four states, Florida, Mississippi, Tennessee, my home state, and South Carolina, are sending significant amounts of ozone. And the only Georgia counties getting protected are in the Atlanta metro area.
However, under a 75 ppb model, we would expect that other counties in Georgia would need to get help from the Transport Rule to tackle the significant contribution of unhealthy air coming into their communities. Many other states may need to cut their emissions to keep from adding to the burden of ozone in Georgia and EPA will need to recalibrate the contribution of Georgia's power plants to other states' ozone burdens.
Response:
EPA agrees that more stringent standards could increase the number of states contributing at a given location.   We intend to work with states to address interstate transport requirements for the reconsidered ozone NAAQS in a timely manner once we finalize the reconsideration of the ozone NAAQS.
Organization: American Petroleum Institute (API)
Comment:
American Petroleum Institute (API)
Future Assessment of Transport Impacts From Non-EGU Sources API is concerned about EPA's plans to apply this rule's technical analysis and framework, to an analysis of the potential role of non-EGU sources to downwind areas in 2011. A thorough examination of the utility of this approach to assessing transported emissions from non-EGUs must be performed before any determinations can be made with respect to transport from non-EGUs for the following reasons. [EPA-HQ-OAR-2009-0491-2649.1, p. 4]
 1) EPA uses the IPM to assess various control scenarios and as the basis for its cost and feasibility analyses underlying the TR. No comparable tool exists for non-EGUs. [EPA-HQ-OAR-2009-0491-2649.1, p. 4]
2) Emissions from the diverse equipment and units that make up petrochemical and refining facilities are mostly emitted at or near ground level. Stack heights for those emissions that come from stacks are shorter than those found in EGUs. Therefore, the assumptions that underlie the long-range transport of emission plumes from EGUs cannot apply to petrochemical and refining facilities. EPA will need to re-examine this aspect of the modeling analysis. [EPA-HQ-OAR-2009-0491-2649.1, p. 4]
 3) EPA should use the most current years of data for an analysis of affected nonattainment or maintenance areas. For example, in the TR, the entire state of Louisiana is brought in to the TR because of a small modeled impact on PM2.5 annual levels at the Clinton Drive monitor in Houston. However, for the past three years, emission levels at this site have been trending downward, and EPA has determined that the area will not be designated as nonattainment. Other areas may face similar situations, particularly as new NAAQS are proposed and states are proceeding through a designation process. [EPA-HQ-OAR-2009-0491-2649.1, p. 5]
4) Cost profiles are different for EGUs and non-EGUs. In many states with mature nonattainment SIP programs, petrochemical and refining facilities have installed numerous control strategies to reduce emissions for local nonattainment problems. In addition, many sources have installed controls in compliance with consent decrees and other programs. Thus, there may not be any remaining ?highly cost effective? controls available. EPA's own analysis throughout the rule proposal concurs with this assessment. [EPA-HQ-OAR-2009-0491-2649.1, p. 5]
5) EPA's modeling approach includes all of the emissions in a state from all source categories to determine if one state's emissions significantly affect a downwind area. But in many cases, point sources are not the major source of emissions. The analysis presented by EPA does not present a demonstration that an individual sector's emissions specifically cause or contribute to nonattainment in a downwind area. If this rule is broadened in the future to include non-EGUs EPA should instead develop a methodology that tests the significance of the particular source category on a downwind state. [EPA-HQ-OAR-2009-0491-2649.1, p. 5]
6) In other tests to see if a source causes or contributes significantly to interference with maintenance (as in the Prevention of Significant Deterioration programs), EPA uses a Significant Impact Limit of 4% of the NAAQS level. API supports the use of this 4% Significant Impact Limit for any rulemakings wherein EPA intends to evaluate the significant contribution of non-EGU sources. [EPA-HQ-OAR-2009-0491-2649.1, p. 5]
7) API also believes that the photochemical models as used in the rulemaking are not significantly precise to examine changes in precursor emissions that could affect as minute a level as 1% of the NAAQS for PM2.5 and ozone. A 4% significance level would better fit the purpose and precision that the model can be expected to achieve. [EPA-HQ-OAR-2009-0491-2649.1, p. 5]
Response:
As noted in the preamble, EPA believes that the broad framework for evaluating significant contribution and interference with maintenance outlined in this rule is applicable to future NAAQS as well.   However, EPA is not taking any final action at this time to apply this framework to any future NAAQS and additional technical analysis would be necessary to do so.  Given the collective nature of emissions contributions, EPA disagrees that it is necessary to demonstrate or test the significance of each particular source category.
See preamble section V.D.1 for discussion of EPA's choice of the 1 percent threshold.
Organization: Calpine Corporation
Comment:
Calpine Corporation
Lastly, Calpine agrees with EPA that the proposed rulemaking and the corresponding Federal Implementation Plan (FIP) will need to be adjusted to comply with the revised ozone standard. It is expected that the ozone standard will be lowered and therefore require a corresponding reduction in the state ozone season NOx budgets. [EPA-HQ-OAR-2009-0491-3614,p.2]
Response:
It will be necessary to address the CAA interstate transport requirements upon any revision to the ozone standard.
Organization: Clean Air Task Force
Clean Air Council
Comment:
Clean Air Council
[These comments were submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-0491-1938, pp.43-44.]
The Council strongly supports EPA's commitment to reviewing whether the Transport Rule needs to be tightened each time EPA revises an air quality standard. It will obviously need to do so, after the new ozone standard that is established. By making clear that this is the EPA policy, major NOX and SO2 producers are now on notice and can plan accordingly.
Clean Air Task Force
Footnote:14 Attainment of the ozone NAAQS will be more difficult. Furthermore, EPA is currently reconsidering the 2008 ozone NAAQS, has made a revised proposal earlier this year to strengthen the standard (75 Fed. Reg. 2938), and is expected to finalize it later this year.  [EPA-HQ-OAR-2009-0491-2738.1, p.1]
Finally, we welcome EPA's stated intention to promulgate a number of rules in the future to require emission reductions from this sector beyond those in the Transport Rule proposal, including -- additional transport rules as necessary to address upwind transport in connection with future revisions to the ozone or fine PM NAAQS (both primary and secondary), including a revised ozone NAAQS later this year and a further rulemaking addressing any associated needed reductions in transported NOx by 2012.[EPA-HQ-OAR-2009-0491-2738.1, p. 5]
Response:
Comments noted.
Organization: Connecticut Department of Environmental Protection
Comment:
Connecticut Department of Environmental Protection
EPA developed the proposed Transport Rule with the goal of addressing Section 110(a)(2)(D) transport attainment/maintenance requirements for the 1997 8-hour ozone and annual PM2.5 NAAQS and the 2006 24-hour PM2.5 NAAQS. The timing of the proposed remedy comes well after the CAA requirement that states modify their SIPs to address transport within three years after a new NAAQS is promulgated, yet still does not address all significant impacts. Therefore, it is imperative that EPA adopt a framework to address transport on a time frame compliant with CAA requirements. [EPA-HQ-OAR-2009-0491-2780.1 p.12]
EPA indicates in the proposed Transport Rule that the agency intends to propose additional rules to address transport as new or revised NAAQS are promulgated. It is important that these subsequent transport rules be proposed and finalized on a timetable tied to NAAQS promulgation to ensure that states implement timely SIP revisions to meet their transport obligations under Section 110(a)(2)(D). [EPA-HQ-OAR-2009-0491-2780.1 p.12]
CTDEP recommends that EPA concurrently evaluate significant transport when setting or revising a NAAQS and develop a Federal Implementation Plan (FIP) backstop when issuing a SIP call to ensure the requirements of CAA section 110(a)(2)(D)(i) are met in a timely manner. Based on the timing requirements of the CAA, CTDEP recommends that the process adhere to the following schedule:
Year 0 (of new or revised NAAQS) EPA promulgates a new or revised NAAQS EPA proposes a Transport SIP call for the new or revised NAAQS and a Transport FIP as a backstop to SIP Call. EPA releases all modeling and technical information with the proposed Transport SIP call to help inform the process and to assist states in developing their Transport SIPs.
Year 1 (of new or revised NAAQS) States recommend to EPA NAAQS designations (maximum one year after NAAQS) EPA finalizes Transport SIP call and FIP
Year 2 (of new or revised NAAQS) EPA finalizes NAAQS designations (maximum two years after NAAQS is promulgated)
Year 3 (of new or revised NAAQS) States submit to EPA final Transport SIPs (maximum three years after NAAQS is promulgated) EPA implements transport FIPs for states that do not submit Transport SIPs or submit inadequate SIPs. This is triggered in any state that fails to submit a complete Transport SIP on time, and helps ensure that transport is dealt with in a timely manner.
Year 5 (of new or revised NAAQS) States submit attainment SIPs (maximum three years after designations) Transport SIP/FIP controls are implemented (three years prior to attainment deadlines)
Year 7 (of new or revised NAAQS) Attainment deadline under Clean Air Act, Part D, subpart 1 for non-ozone NAAQS
Year 8, 11, 14, and onward (of new or revised NAAQS) Attainment deadline for moderate, serious, severe, and other ozone areas under Clean Air Act, Part D, subpart 2
[EPA-HQ-OAR-2009-0491-2780.1 p.13]
Furthermore, EPA is expected to finalize a revised 8-hour ozone NAAQS later this year in the range of 60 to 70 ppb and to propose a second Transport Rule in 2011 to establish a mechanism for states to comply with the CAA transport provisions for that revised NAAQS. Clearly, given the location of the Greenwich monitor and the minimal influence of Connecticut emissions on that monitor, Connecticut will be dependent on the second Transport Rule to provide substantial upwind emission reductions to provide the 10 to 20 ppb improvement needed to attain the revised NAAQS at that monitor. The level of necessary upwind reductions will even be greater, depending on the growth of upwind emissions resulting from economic recovery. [EPA-HQ-OAR-2009-0491-2780.1 p.13]
FIP vs. SIP. CTDEP understands EPA's proposal of a FIP instead of a SIP for rule implementation due to timing concerns. In subsequent transport rules, CTDEP recommends that EPA provide SIP guidance to states and allow states to choose a SIP or FIP path, as was done under CAIR. This would allow states to choose their own allocation methodologies to address differing energy resource portfolios, provided that such methodologies do not result in individual sources violating Section 110(a)(2)(D) of the CAA. [EPA-HQ-OAR-2009-0491-2780.1 p.20]
Response:
EPA appreciates the comments on suggested approaches for systematically addressing transport as an integral part of the NAAQS publication and implementation process.   See preamble section X for discussion of SIP alternatives to the FIPs in the Transport Rule.
Organization: Constellation Energy
Comment:
Constellation Energy
Constellation Energy also urges EPA to consider timing any revision of the Transport Rule to be concurrent with the regulatory changes necessary to implement the upcoming strengthening of the ozone national ambient air quality standard. [EPA-HQ-OAR-2009-0491-3613,p.2]
Response:
EPA will consider this recommendation.   Given that certain technical analyses are dependent on the selected level of the NAAQS, it may be difficult to address transport issues concurrently.   EPA intends to work with states to address transport requirements in a timely manner to assist states in developing their transport SIPs by the statutory deadline.
Organization: Council of Industrial Boiler Owners (CIBO)
Comment:
Council of Industrial Boiler Owners (CIBO)
While CIBO in principle prefers to have advance notice of planned future regulatory actions by EPA, EPA's approach here creates the worst of all worlds. EPA is tying an aggressive future timeline for issuing new Transport Rule standards on industrial sources to the issuance of the soon-to-be published revised ozone rule. Yet presumably States would first implement the revised ozone standard and would make determinations based on statewide data, which sources would be regulated, and by what relative measures. Yet here EPA informs of region wide NOx and SO2 reductions in advance of State SIP deadlines for the revised ozone standard not yet published. This gives businesses zero certainty for what to expect over the next several years, making business planning impossible.
Response:
Specific SIP requirements for upcoming air quality standards are, by necessity, dependent on the level of the standard that is chosen.    It is not possible to predict, in advance of the necessary technical analyses, the degree of emissions reductions required by those standards.    EPA intends to work with states to address CAA transport requirements for any revised standards in a timely manner.  EPA is not taking any final action with respect to any transport requirements for any NAAQS other than the 1997 ozone the 1997 PM2.5 and the 2006 PM2.5 NAAQS.
Organization: Dominion
Comment:
Dominion
A reasonable timeline to comply with new regulations is especially important for planning purposes considering the number of additional EPA regulatory actions expected over the next several years. EPA has recently finalized new S02 and NOx NAAQS, has indicated it will issue a subsequent 'Transport Rule II' by late next year and on the heels of finalizing this rule to address the expected promulgation (October 2010) of a more stringent ozone standard, and it is almost certain that EPA will propose an additional major transport rule in 2012 to address a more stringent late-2011 NAAQS for particulate matter. [EPA-HQ-OAR-2009-0491-2715.1, p.16]
Response:
See discussion in preamble section VII.C.1 regarding importance of coordinating this rule with attainment deadlines for the 1997 ozone and 1997 and 2006 PM2.5 standards.
EPA will be evaluating the appropriate deadlines for any future air quality standards.
Organization: Edison Electric Institute (EEI)
Edison Mission Energy (EME)
EquiPower Resources Corp.
Comment:
Edison Electric Institute (EEI)
Many states and environmental groups are calling for Transport Rule II to consider sources beyond EGUs because of their relative importance to attaining and maintaining NAAQS. EEI agrees that the Agency should consider sources other than utility units in any such future rulemakings, including the next revision of the particulate matter NAAQS.  [EPA-HQ-OAR-2009-0491-2697.1, p.15]
[These comments were submitted as testimony at the Atlanta, Georgia public hearing on September 1, 2010.  See Docket Number EPA-HQ-OAR-0491-1939, pp.53-54.  These comments were also submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-2009-0491-1938, pp.102-103.]
EEI has misgivings regarding the proposed Transport Rule providing little long-term certainty because its requirements will be superseded in the near future. EPA is planning to issue a separate proposal regarding NOx emissions related to the 1997 ozone standard. In the near future, EPA also has indicated it will issue a Transport Rule II related to the October 2010 ozone standard and it is almost certain that EPA will propose an additional major Transport Rule by 2012 to address the more stringent 2011 particulate matter standard.
Edison Mission Energy (EME)
Finally, with respect to EPA's statement, in the overview materials that it will be Assessment Group Region for Purposes of Reducing Regional Transport of Ozone, 63 Fed. Reg. 57356, 57467 (Oct. 27, 1998). 36 Phase I of the Transport Rule70, EME submits that the Agency should not propose a Transport Rule II, but rather should, as explained in Section VIII, look for the necessary reductions from other NOX sources as EGUs only constitute a small fraction of total NOX emissions in the U.S. Finally, with respect to EPA's statement, in the overview materials that it will be proposing a "Transport Rule II" in 2011 to obtain NOX reductions beyond those contemplated by Phase I of the Transport Rule, EME submits that the Agency should not propose a Transport Rule II, but rather should, as explained in Section VIII, look for the necessary reductions from other NOX sources as EGUs only constitute a small fraction of total NOX emissions in the U.S. [EPA-HQ-OAR-2009-0491-2707.1, pp.35-36]
THE EMISSION REDUCTIONS CONTEMPLATED BY THE TRANSPORT RULE WILL ACHIEVE SIGNIFICANT EMISSIONS REDUCTION SOLELY FROM THE POWER GENERATION SECTION; FUTURE SO2 AND NOX REDUCTIONS BEYOND PHASE II SHOULD COME FROM NON-EGUS [EPA-HQ-OAR-2009-0491-2707.1, p.42]
The NOx and SO2 emissions reductions proposed in the Transport Rule represent substantial emissions reductions. In fact, the Phase II caps represent EGU reductions in affected states equal to 71% for SO2 emissions and 52% for NOx emissions compared to 2005 levels. EPA predicts that the Phase II SO2 and NOx caps will bring 194 of the 207 counties with nonattainment areas into attainment with respect to either the PM2.5 or Ozone NAAQS  - approximately 94% of all nonattainment areas. In addition, the remaining nonattainment areas will be considerably closer to achieving attainment. Despite the substantial progress outlined in the Proposed Rule, EPA has nonetheless indicated that there will be a second phase of the Transport Rule targeted at further reductions of NOx emissions (and potentially SO2). [EPA-HQ-OAR-2009-0491-2707.1, p.42]
Based on the substantial progress toward NAAQS attainment that the proposed reductions will achieve, and particularly given that the power generation sector will shoulder the entire financial and regulatory burden to achieve them, EME submits that EPA (and ultimately state regulators) should not look to EGUs for additional reductions in a "Second Transport Rule." Rather, EPA should look to non-EGU sources for any additional reductions that are needed to bring downwind states into attainment with NAAQS beyond those proposed. Indeed, it would be inefficient, inequitable, and likely ineffective for regulators to seek additional reductions from EGUs for purposes of further ameliorating downwind nonattainment after the Transport Rule's reductions have occurred. [EPA-HQ-OAR-2009-0491-2707.1, pp.42-43]
[See EPA-HQ-OAR-2009-0491-2707.1, pp.43-44 for additional comments pertaining to The Emissions Reductions Contemplated by the Transport Rule will Achieve Significant Emissions Reductions Solely From the Power Generation Section; Suture SO2 and NOx Reductions Beyond Phase II Should Come From Non-EGUs]
EquiPower Resources Corp.
The Agency should not seek additional NOX reductions from EGUs beyond those The Agency should not seek additional NOX reductions from EGUs beyond those already contemplated by the Transport Rule. NOX emissions from EGUs before the Transport Rule even takes effect have declined by over 70% since 1990 and currently account for only 12% of the national total. After the reductions required by Phase I and II of the Rule have occurred, these levels will be even lower. It is unreasonable for EPA to expect additional NOX reductions from EGUs, when they will account for such a small proportion of the total that remains. [EPA-HQ-OAR-2009-0491-2704.1, p.2]
THE AGENCY SHOULD NOT SEEK ADDITIONAL NOX AND SO2 REDUCTIONS FROM THE POWER GENERATION SECTOR BEYOND THOSE CONTEMPLATED BY THE TRANSPORT RULE [EPA-HQ-OAR-2009-0491-2704.1, p.30]
While the emission reductions proposed under the Transport Rule are predicted to make substantial progress toward NAAQS attainment, with the Phase II SO2 and NOx caps bringing 194 of the 207 counties with nonattainment areas into attainment for either the PM 2.5 or Ozone NAAQS, EPA has nonetheless indicated that it will be proposing a second rule in 2011 targeted at further reductions of NOx emissions (and potentially SO2).65 EquiPower submits that EPA (and ultimately state regulators) should not look to EGUs for additional reductions in a "Transport Rule II." Rather, additional reductions should be sought from other NOX emissions sources. The power generation sector will shoulder the entire financial and regulatory burden to achieve the reductions in the Transport Rule, yet EGUs only constitute a small fraction of total NOX emissions in the U.S. Thus, it would be inefficient, inequitable, and likely ineffective for regulators to seek additional reductions from EGUs after the Transport Rule's reductions have occurred. [EPA-HQ-OAR-2009-0491-2704.1, p.30; see pp.30-31 of this comment summary for additional comments pertaining to THE AGENCY SHOULD NOT SEEK ADDITIONAL NOX AND SO2 REDUCTIONS FROM THE POWER GENERATION SECTOR BEYOND THOSE CONTEMPLATED BY THE TRANSPORT RULE]
In sum, targeting the power generation sector for further reductions before requiring other source sectors to contribute to environmental achievements would be inefficient, inequitable and ineffective. A myopic, EGU-centric approach to regulation would waste considerable resources, delay environmental benefits, and result in unjustified cost increases to consumers of electricity. Accordingly, for reductions beyond the Phase II caps, regulators should look to source sectors for which additional reductions would be efficient, effective and equitable. In sum, targeting the power generation sector for further reductions before requiring other source sectors to contribute to environmental achievements would be inefficient, inequitable and ineffective. A myopic, EGU-centric approach to regulation would waste considerable resources, delay environmental benefits, and result in unjustified cost increases to consumers of electricity. Accordingly, for reductions beyond the Phase II caps, regulators should look to source sectors for which additional reductions would be efficient, effective and equitable. [EPA-HQ-OAR-2009-0491-2704.1, p.31]
EquiPower is also concerned that: The Agency is considering additional NOX reductions from EGUs beyond those already contemplated by the Transport Rule. [EPA-HQ-OAR-2009-0491-2704.1, p.32]
Response:
EPA is not taking any final action with respect to the transport requirements for any NAAQS other than the 1997 ozone, 1997 PM2.5 and 2006 PM2.5 NAAQS.
Organization: Environmental Defense Fund (EDF)
Comment:
Environmental Defense Fund (EDF)
EPA should carefully consider raising the cost threshold for NOx in light of CAMx modeling results suggesting that the proposed thresholds are insufficient to achieve full attainment with the 24-hour PM2.5 NAAQS, EPA's failure to take protection action for the March 2008 ozone NAAQS as well as the scientific evidence that nitrates contribute disproportionately to nonattainment in winter months. And EPA must thoroughly examine this issue in the forthcoming part II Transport Rule by providing for a higher, more protective cost threshold and examining the range of available emissions reductions from a wider variety of sources).  [EPA-HQ-OAR-2009-0491-2834.1 p.7]
c. Smart investment now can help EGUs prepare for future regulations [EPA-HQ-OAR-2009-0491-2834.1 p.14]
Sound federal regulatory policy works best when partnered with common-sense behavior by regulated entities. Federal regulations do not come as a surprise. There are legislated timetables for many EPA actions, including review and updates of the NAAQS. Other timelines are spelled out in Consent Decrees and other Court Orders. Regulated entities are well aware of the suite of regulatory action expected over a given time period. With such foreknowledge, competent regulated entities can plan their investment strategies, not in a reactive piecemeal fashion, but in a long-term proactive manner  --  aligning prudent investment plans with the nation's public health goals  --  rather than fighting them.
For instance, the manner in which one complies with the proposed Transport Rule through installation of emissions control technologies and other strategies, can affect how well-prepared companies are for future regulations of air toxics and pollutants. EPA has announced its intention to issue a new NAAQS for ozone and will be promulgating other rules that will impact EGUs over the next several years. The updated ozone NAAQS, for example, has been in process for some time and EPA announced it will tighten the standard in the fall of 2010 to between 60 and 70 ppb to be consistent with recommendations of the Clean Air Scientific Advisory Committee in 2006. Industry should look ahead to the suite of regulations that are in the pipeline to make strategic, long-term decisions about investments made to comply with the Transport Rule. However, for some aging coal plants it may be more economical to retire the plant instead of investing in modern control technology when prudently coordinating compliance with existing and reasonable foreseeable air quality actions by EPA over the next several years. Measures like energy efficiency can be implemented as a key part of a multi-pollutant reduction strategy to smooth this transition for many power companies. [EPA-HQ-OAR-2009-0491-2834.1 p.15]
Response:
See discussion in section IV.C.1 of the preamble to the final rule.
Organization: Exelon
Comment:
Exelon
EPA is proposing to establish revised or new NAAQS for ozone and particulate matter that are more protective of health and the environment. The proposed Transport Rule provides a workable methodology for calculating and rapidly implementing any future reductions in state budgets that will be necessary to eliminate upwind states' significant contribution to nonattainment and interference with maintenance of any new or revised NAAQS. Reductions in the state budgets contained in the proposed Transport Rule will, in fact, be needed to eliminate significant contributions to nonattainment and interference with maintenance of these new lower NAAQS by upwind states. EPA should therefore propose any reduced state budgets at the time it adopts the new or revised NAAQS and include requirements for states to implement these reductions in their budgeted emissions in the SIP calls for these new or revised NAAQS. Even if EPA could not include these requirements in a FIP, it could include adjusted budgets and proposed compliance dates as a part of a SIP call. [EPA-HQ-OAR-2009-0491-2666.1, p.12]
Response:
EPA intends to work with states to address transport requirements for any new or revised NAAQS in a timely manner once those NAAQS are published.
Organization: Florida Department of Environmental Protection
Comment:
Florida Department of Environmental Protection
In addition, states are anticipating the promulgation of the new ozone standard in approximately 30 days and understand the PM2.5 standard will be revisited in the near future as well. The Division is concerned that decisions required to implement this rule may not mesh well with EPA's second transport rule (Transport Rule 2). It would be more efficient to address these issues holistically once the new ozone and PM2.5 standards are promulgated. [EPA-HQ-OAR-2009-0491-2624.1, p.2]
Response:
EPA currently intends to promulgate the new ozone standard later this year.  EPA appreciates the comment that we need to ensure that subsequent requirements under any subsequent transport rule would mesh well with the requirements of this rule.
Organization: Florida Electric Power Coordinating Group, Inc. (FCG)
Florida Municipal Electric Association (FMEA)
Comment:
Florida Electric Power Coordinating Group, Inc. (FCG)
EPA also acknowledges that it intends to propose revisions to the Transport Rule, at the same time as it finalizes the rule, to address imminent changes to the ozone and PM2.5 ambient standards. This piecemeal approach to rulemaking is flawed on numerous grounds. From a legal standpoint, it is an abuse of discretion and arbitrary and capricious. From a bureaucratic standpoint, it is highly wasteful and inefficient. From a planning and economic standpoint, it is nonsensical. And from an environmental standpoint, it is needlessly redundant; CAIR is doing the job on an interim basis. In fact, EPA's September 28,2010 CAIR report cited above touts the benefits of CAIR, and shows that 2009 NOx emissions (annual and ozone season) were already below levels EPA projected for 2012 under the Transport Rule. EPA should wait and promulgate a single, defensible Transport Rule addressing all ambient standards. [EPA-HQ-OAR-2009-0491-2658.1, p.4]
Florida Municipal Electric Association (FMEA)
EPA also acknowledges that it intends to propose revisions to the Proposed Transport Rule, at the same time as it finalizes the rule, to address imminent changes to the ozone and PM2.5 ambient standards. This piecemeal approach to rulemaking is flawed on numerous grounds. From a legal standpoint, it is an abuse of discretion and arbitrary and capricious. From a bureaucratic standpoint, it is highly wasteful and inefficient. From a planning and economic standpoint, it is nonsensical. In fact, EPA's September 28, 2010, CAIR report cited above touts the benefits of CAIR, and shows that 2009 NOx emissions (annual and ozone season) were already below levels EPA projected for 2012 under the Transport Rule. And from an environmental standpoint, it is needlessly redundant; CAIR is doing the job on an interim basis. EPA should wait and promulgate a single, defensible Transport Rule addressing all ambient standards. [EPA-HQ-OAR-2009-0491-2731.1, p. 6]
The threat of moving Group 2 states to Group 1 creates unnecessary uncertainty: While Florida is currently in Group 2 with no additional reductions required in 2014, EPA makes it clear that it is going to reevaluate the Group placement of states in light of the revised NAAQS in 2011 and 2012 meaning some states may be moved to Group 1. However, EPA is considering only the 1997 Ozone NAAQS in the current Transport Rule proposal even though a revised Ozone NAAQS is in effect. FMEA believes that such a piecemeal approach to dealing with current and future NAAQS revisions creates confusion and makes compliance planning by state regulators and industries nearly impossible. EPA should fix only those CAIR issues remanded by the D.C. Court in this Transport Rule and subsequently initiate a new interstate rulemaking once all current NAAQS reviews are completed. This second interstate rulemaking should allow sufficient time to avoid the mandatory Federal Implementation Planning of states envisioned in the Proposed Transport rule. [EPA-HQ-OAR-2009-0491-2731.1, p. 10]
Response:
EPA has an obligation to address the concerns raised by the Court in a timely manner.  EPA is not taking any final action with regard to transport requirements related to any NAAQS other than the 1997 ozone, 1997 PM2.5 and 2006 PM2.5 NAAQS.
Organization: Gainesville Regional Utilities (GRU)
Comment:
Gainesville Regional Utilities (GRU)
The Threat of Moving Group 2 States to Group 1 Creates Unnecessary Uncertainty
While Florida is currently in Group 2 with no additional reductions required in 2014, EPA makes it clear that it is going to reevaluate the Group placement of states in light of the revised NAAQS in 2011 and 2012 meaning some states may be moved to Group 1. However, EPA is considering only the 1997 Ozone NAAQS in the current proposed CATR proposal even though a revised Ozone NAAQS is in effect. GRU believes that such a piecemeal approach to dealing with current and future NAAQS revisions creates confusion and makes compliance planning by state regulators and industries nearly impossible. EPA should fix only those CAIR issues remanded by the DC Court in this proposed CATR and subsequently initiate a new interstate rulemaking once all current NAAQS reviews are completed. This second interstate rulemaking should allow sufficient time to avoid the mandatory 'FIPing' of states envisioned in the proposed CATR. [EPA-HQ-OAR-2009-0491-2674.1, p.7]
Response:
EPA has an obligation to address the concerns raised by the Court in a timely manner.  EPA does not believe we have the option to delay this rule until all current NAAQS review are completed.  Moreover, the rule provides for substantial public health benefits in the near term.
Organization: Indiana Department of Environmental Management
Comment:
Indiana Department of Environmental Management
Examples of issues that U.S. EPA must address in this second proposal include:
:: Updating the air quality data relied upon within the proposed rule. This includes updating the monitored design values (2007 was the most current year used, while quality assured data is readily available through 2009).
:: Updating the emissions data and emission control assumptions and providing a transparent explanation of how future year budgets and allocations were derived from baseline emissions.
:: Describing how it intends to track and enforce allocations, especially based on the agency's proposal to rely on FIPs with only State level emission caps as the primary enforcement tool. [EPA-HQ-OAR-2009-0491-2645.1]
Response:
EPA made numerous updates to air quality and emissions data in response to comments on the Transport Rule proposal.
See preamble section VII for discussion of tracking and enforcement of allocations.
Organization: Iowa Department of Natural Resources (IDNR)
Comment:
Iowa Department of Natural Resources (IDNR)
On January 6, 2010, EPA proposed to lower the primary 8-hour ozone standard within the range of 60- 70 ppb and to add a new secondary standard. This action, when finalized, will likely significantly increase the number of areas struggling to attain or maintain the standards. We are encouraged by EPA's commitment to promulgate a second phase of the Transport Rule to assist states in meeting their clean air and interstate contribution obligations following the revision to the ozone NAAQS. An adequate and timely second phase to the Transport Rule is needed as the revised ozone standard is expected to increase the number of nonattainment or maintenance areas significantly impacted or overwhelmed by interstate pollutant transport. We urge EPA to quickly propose a suitable second phase of the Transport Rule shortly after the expected revision to the ozone standard. [EPA-HQ-OAR-2009-0491-2609.1, p.1]
 A second phase of the Transport Rule should coordinate timelines for emissions reductions with attainment dates. It is expected that ozone implementation regulations will be required to determine nonattainment classifications and resulting attainment deadlines. We request that EPA quickly propose and finalize an ozone implementation rule following promulgation of the revised standard. Timely implementation rules in concert with a second phase of the Transport Rule are necessary components to reduce or eliminate interstate pollutant contributions in those areas failing or struggling to attain the standards. An ozone implementation rule and a second phase to the Transport Rule developed with regulatory consistency and schedule harmonization would assist states in the efficient development of appropriate State Implementation Plans. [EPA-HQ-OAR-2009-0491-2609.1, pp.1-2]
Consistent with NACAA's comments provided at the Public Hearing held in Chicago on August 19, 2010, we also strongly support EPA's pledge to consider whether a new or revised transport rule is warranted when a NAAQS is revised or added. [EPA-HQ-OAR-2009-0491-2609.1, p.2
Response:
EPA intends to address CAA interstate transport requirements in a timely manner for any future revised NAAQS.
Organization: Lansing Board of Water & Light
Gulf Coast Lignite Coalition
Golden Spread Electric Cooperative
E.ON U.S.
JEA
Comment:
E.ON U.S.
EPA states that the requirements of the rule are expected to change, but fails to address the impacts of the expected more stringent requirements and the uncertainty this creates. EPA states that it expects to issue a separate proposal regarding NOx emissions related to the 1997 ozone standard and a "Transport Rule II" related to an again-revised ozone standard. EPA is clearly creating a moving target that makes planning nearly impossible and very inefficient. [EPA-HQ-OAR-2009-0491-2797.1, p.3]
Golden Spread Electric Cooperative
EPA's proposal includes plans to develop a second phase plan in response to the upcoming finalization of a new ozone standard; the first phase plan for the ozone NAAQS considers only the 1997 standard.  Given the short periods between the developments of these plans, and with additional control requirements forthcoming in updated New Source Performance Standards and new Maximum Achievable Control Technology NESHAPS (National Standards for Hazardous Air Pollutants), EPA should coordinate the regulation developments to avoid or clarify overlapping or conflicting requirements.  It is more cost efficient to take an integrated approach rather than to have separate programs that could require multiple steps for emission reduction technologies, especially when some deadlines have been arbitrarily set. [EPA-HQ-OAR-2009-0491-2808.1 p.5]
Gulf Coast Lignite Coalition
 The Transport Rule relies on 1997 annual PM2.5 standards, the 2006 daily PM2.5 standards, and the 1997 8-hour ozone standards, which are all currently under review by the EPA and will likely be revised within the next year or two.1 To base emission reduction requirements on standards which will change before the 2012 and 2014 compliance deadlines proposed in the Transport Rule, only adds to the difficulty in demonstrating compliance with the Transport Rule. As a solution, EPA offers that they will "issue as soon as possible a proposal to address the transport requirements with respect to the reconsidered standard."2 However, the solution only offers additional rule promulgations in the future, not addressing the immediate compliance deadlines.
1 The revised 8-hour ozone NAAQs should be published in October of 2010 according to the EPA. The 2006 PM2.5 standards are currently under EPA review and revised standards may be proposed as early as February 2011.
[EPA-HQ-OAR-2009-0491-2734.1 p.2]
JEA
The threat of moving Group 2 states to Group 1 creates uncertainty
While Florida is currently in Group 2 with no additional reductions required in 2014, EPA makes it clear that it is going to reevaluate the Group placement of states in light of the revised NAAQS in 2011 and 2012 meaning some states may be moved to Group 1. However, EPA is considering only the 1997 Ozone NAAQS in the current Transport Rule proposal even though a revised Ozone NAAQS is in effect. JEA believes that such a piecemeal approach to dealing with current and future NAAQS revisions creates confusion and makes compliance planning by state regulators and industries nearly impossible. EPA should only fix the CAIR remanded issues in this Transport Rule and initiate new interstate rulemaking once all current NAAQS reviews are completed. [EPA-HQ-OAR-2009-0491-2713.1, p.4]
Lansing Board of Water & Light
Proposed update to a proposed rule creates too much uncertainty, too much risk
EPA has already announced their intent to revise the proposed rule in regards to emissions of NOx, based upon a forthcoming reconsideration of the ozone NAAQS. The level of uncertainty this creates throughout the electrical generation industry is beyond fathom! Pollution control equipment for this industry is not something that can be bought at a local supermarket, only to be discarded when a new one is needed. This equipment takes years to design and install requiring investments of several million dollars. With a proposal to modify a proposed rule, based on another decision that is not yet final, BWL will have to gamble with the resident's and business community's money. BWL will either gamble with a minimum investment to meet the first proposed rule or more expensive investment assuming the revision will require greater control. This is an unacceptable risk and a very poor money-management practice, especially for a municipal utility. [EPA-HQ-OAR-2009-0491-2752.1,pp.8-9]
Furthermore, this is but the beginning of a series of mismanaged regulatory proposals targeted upon the electrical generating industry. [EPA-HQ-OAR-2009-0491-2752.1, p.9]
Response:
EPA hopes to reduce the uncertainty associated with the requirements of any future NAAQS as much as possible.   In the meantime, EPA is addressing its obligation to move expeditiously to address the concerns raised by the court in North Carolina case, and to address, for states in the eastern United States, the requirements of section 110(a)(2)(D)(i)(I) with respect to the 2006 PM2.5 standards.
Organization: Maryland Department of Environment (MDE)
Comment:
Maryland Department of Environment (MDE)
When EPA addresses the proposed new 2010 NAAQS in its next update to the proposed Transport Rule, MDE advocates that EPA proceed as follows: (1) determine the emission reductions necessary to eliminate each state's significant contribution to nonattainment and interference with maintenance of another state's ability to meet the new NAAQS; (2) examine costs. Note that if a state eliminates its significant contribution to nonattainment or interference with maintenance, any additional reduction does not have as much impact on improving its neighbor's air quality as do local measures. [EPA-HQ-OAR-2009-0491-2639.2, p.5]
Future Transport Rules and Ongoing Policy Concerns, Transport Rule II
In order to complete the task under section 110(a)(2)(D)(i) to eliminate all significant contribution and interference with maintenance, EPA needs to include additional reductions in the final rule that fully address the transport component of nonattainment with the 1997 ozone and 2006 PM2.5 NAAQS. In the proposed Transport Rule, EPA acknowledges that the transport FIPs will not completely satisfy the emission reduction requirements of Clean Air Act section 110(a)(2)(D)(i)(I). Two areas -- Houston, Texas and Baton Rouge, Louisiana -- are expected to still be in violation of the 1997 ozone NAAQS in 2014, while the New York City area is expected to have continued maintenance issues with this standard. [EPA-HQ-OAR-2009-0491-2639.2, pp.17-18]
In addition, EPA will soon be releasing its reconsidered ozone NAAQS, which will require even greater efforts by upwind states to reduce transport impacts. To solve the additional transport impacts under the soon-to-be revised ozone NAAQS, EPA's next version of the Transport Rule, "Transport Rule II," will need to be released in a timely manner. It will also need to contain assurances that upwind impacts will be eliminated within a timeframe that allows downwind states to attain the NAAQS with three years of clean air quality data. It is critical that the precedents set by the currently proposed transport rule are solid and sustainable to application to future updates to the rule. [EPA-HQ-OAR-2009-0491-2639.2, p.18; For additional comments pertaining to Future Transport Rules and Ongoing Policy Concerns: Transport Rule II, see pages 17-19 of this comment]
The 2008 NAAQS and the Next NAAQS Issuance
EPA did not appropriately expand the scope of the analyses in the current proposed rule to include the new and current 2008 8-hour ozone NAAQS (75 ppb). In this proposed Transport Rule, EPA has understandably focused in fixing the "fatal flaws" of CAIR in order to comply with the court's remanding of CAIR. Even though EPA has reconsidered the 2008 standard, it is still effective until a new standard is promulgated; therefore, Maryland would like to point out that any effort by EPA to control precursors of ozone should address the new 0.075 ppm and not the old 0.08 ppm standard. [EPA-HQ-OAR-2009-0491-2639.2, pp.19-20]
The old ozone NAAQS was promulgated in 1997 and effective in 2004. The SIP for the 0.08 ppm NAAQS was due in 2007 and the attainment date was 2010 for moderate nonattainment areas, which covered the majority of the nonattainment areas. Since both of these dates and the due date of the Transport SIP for the 0.08 ppm standard have already passed, Maryland believes that this rule should focus more on what new standards the states will have to address moving forward, such as the 0.075 ppm level. If the EPA had focused on the 0.075 ppm standard, the technical analysis for the proposal would be based on possibly 2014 as the first moderate attainment year, which would then provide EGUs the time needed to install advanced NOx controls such as selective catalytic reduction (SCR) systems. This also falls in line with the second date in the Transport Rule for the SO2 control year. [EPA-HQ-OAR-2009-0491-2639.2, p.20]
All of these issues raise further questions that Maryland would like EPA to fully address, such as what levels will the new ozone NAAQS be set at later this year, and how will they be integrated with this current proposed Transport Rule, if at all? When will the new ozone NAAQS be enforceable on its own, or (as Maryland expects) will it only be enforced through the issuance of a second transport rule? If this is the case, and EPA expects to enforce the new ozone NAAQS through the issuance of a second transport rule, Maryland notes that EPA needs to issue a firm timetable for the issuance of the second transport rule to allow states, industry stakeholders and all affected parties time to develop proper strategies to successfully implement the next rule and have a realistic shot at achieving measurable emissions reductions benchmarks. [EPA-HQ-OAR-2009-0491-2639.2, p.20]
Response:
EPA appreciates these comments.  EPA is not, however, taking any final action act this time with respect to the transport requirements of any NAAQS other than the 1997 PM2.5, 1997 ozone and 2006 PM2.5 NAAQS.
Organization: Massachusetts Department of Environmental Protection
Comment:
Massachusetts Department of Environmental Protection
The proposed Transport Rule requires NOx reductions by 2012 but does not require additional NOx reductions in 2014. For states to meet the expected 2017 attainment deadline for moderate areas under a 2010 ozone standard, additional NOx reductions from power plants and other source sectors in the 2014-2016 timeframe are needed. EPA should require a second phase of NOx reductions for 2014 in the final Transport Rule, as it has proposed for S02. [EPA-HQ-OAR-2009-0491-2787.2 p.2]
In light of the promulgation of the 2008 ozone NAAQS, and the anticipated October 2010 ozone NAAQS, we believe EPA should not have restricted the scope of the proposed Transport Rule to significant contribution to non-attainment or interference with maintenance under the 1997 ozone standard. We strongly urge EPA to promptly propose a second Transport Rule in 2011, as it has committed to do, and to finalize a rule in time for states to realize the benefits of reduced transport by their attainment years under the new anticipated ozone standard. It is essential that EPA address transport concurrently with the adoption of new air quality standards in a timeframe that will allow Massachusetts to meet its attainment requirements without imposing onerous and far less cost-effective state control measures.  [EPA-HQ-OAR-2009-0491-2787.2 p.3]
We commend EPA for proposing a methodology for assessing transported air pollution that allows for quicker and more consistent analysis of the impact of transport under future revised air quality standards. Massachusetts air quality does not meet the 2008 ozone standards and we anticipate a non-attainment designation under the ozone standard expected to be issued in October 2010. It is crucial that the health protections these new standards will provide be realized as quickly as possible. A timely assessment of the impact of transport on Massachusetts air quality is essential to meeting that goal. [EPA-HQ-OAR-2009-0491-2787.2 p.11-12]
Response:
EPA intends to work with states to address CAA transport requirements for revised ozone standards in a timely manner once any ozone NAAQS revision is published.
Organization: Metropolitan Washington Air Quality Committee
Comment:
Metropolitan Washington Air Quality Committee
However, we are aware that the proposed rule will not establish emission reduction requirements necessary for our region to achieve new more stringent NAAQS for ozone and fine particles expected in the very near future. It will be urgent for EPA to conduct necessary analysis needed to support a new rulemaking to amend the final Transport Rule so that controls on other sources and/or new lower state emission budgets for power plants are set at levels that will enable states to meet the new NAAQS. We also urge EPA to advance other new federal initiatives to address emissions during high electricity demand days and to reduce emissions from other sectors that contribute to emissions of air pollutants as well, either through amendments to the Transport Rule or through other regulatory initiatives. [EPA-HQ-OAR-2009-0491-2618.1, p.1]
Response:
EPA appreciates the commenters suggestion for update technical analysis to address CAA interstate transport requirements for updated NAAQS.
Organization: Minnesota Pollution Control Agency (MPCA)
Comment:
Minnesota Pollution Control Agency (MPCA)
The MPCA acknowledges the unique circumstances of this Transport Rule, which is necessary to ensure the continuance of reductions achieved under CAIR and to meet requirements for a Federal Implementation Plan (FIP) for 11 0(a)(2)(D). These circumstances lead to a very short timeframe for implementing the rule, which makes it difficult for states to consider undertaking a State Implementation Plan (SIP) to substitute for the FIP and may also make it difficult for some sources to install necessary controls. The MPCA recognizes that the necessary timeline for this first Transport Rule will make it difficult for EPA to address these concerns, but hope that Transport Rule Two will allow for longer implementation timelines and resolve some of these concerns. Therefore, the MPCA encourages EPA to move quickly to Transport Rule Two and ensure that future transport rulemakings allow a longer time period for implementation planning for both states and affected sources. [EPA-HQ-OAR-2009-0491-2521.1, p.1]
Response:
EPA intends to work with states to address CAA interstate transport requirements under any revised ozone NAAQS in a timely manner once those standards are published.   We agree that moving in timely manner would be helpful for implementation and planning.
Organization: Mothers and Others for Clean Air
Comment:
Mothers and Others for Clean Air
[These comments were submitted as testimony at the Atlanta, Georgia public hearing on September 1, 2010.  See Docket Number EPA-HQ-OAR-0491-1939, p.18.]
I'm here today to support EPA's preferred version of the proposed Transport Rule and also to urge EPA to integrate more quickly the new 2010 ozone standard into the final Transport Rule rather than waiting to finalize a response in 2012.
Response:
Additional technical analyses will be needed to address the new ozone standards.  Some of those technical analyses are dependent on the level of the standard, and thus it is not possible to integrate those considerations into this Transport Rule without a significant delay.
Organization: National Association of Clean of Air Agencies (NACAA)
Comment:
National Association of Clean of Air Agencies (NACAA)
EPA Needs to Finalize Transport Rule II Quickly and Work With Closely with NACAA and Its Members in Fashioning the Rule
Finally, and very critically, NACAA urges EPA to finalize Transport Rule II quickly. EPA must promulgate a second Transport Rule no later than 2012 if the agency is indeed serious about helping state and local air pollution control agencies to address interstate transport, meet their statutory obligations under the Clean Air Act (e.g., meet the attainment deadlines for moderate nonattainment areas) and to ultimately attain the health-based standards. We also urge the agency to work closely with NACAA and its members so that this next phase fits seamlessly into state and local air agency planning and reflects a deep collaboration with state and local air agencies. [EPA-HQ-OAR-2009-0491-2771.1, p.7]
[These comments were submitted as testimony at the Chicago, Illinois public hearing on August 19, 2010.  See Docket Number EPA-HQ-OAR-0491-1746, pp.107-110.  Comments also submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-0491-1938, pp.80-83.]
We are also pleased that EPA's committed to quickly finalizing a second transport rule, Transport Rule II, in recognition that much tighter NOx caps will be needed to address the pending revision to the 8-hour ozone standard.
NACAA strongly supports EPA's pledge to review whether a new or revised Transport Rule is needed each time it revises an air quality standard.
Then, as EPA plans, the Agency should turn to the forthcoming ozone standard and promulgate a far more stringent NOx cap for Transport Rule II that achieves the maximum emission reductions that are technologically feasible and cost effective to ameliorate the entire transport problem associated with the revised ozone standard.
EPA must address these source categories as well when it proposes its Transport Rule II.
Finally, and very critically, NACAA urges EPA to finalize Transport Rule II quickly.
EPA must promulgate a second Transport Rule no later than 2012 if the Agency is indeed serious about helping state and local air pollution control agencies to address interstate transport, meet their statutory obligations under the Clean Air Act and to ultimately attain the health-based standards.
Response:
EPA agrees with the need to address transport under any revised NAAQS, and agrees that any such analysis would need to consider additional source categories.  EPA is not, however, taking any final action at this time with respect to the transport requirements related to any NAAQS other than the 1997 ozone, 1997 PM2.5 and 2006 PM2.5 NAAQS.
Organization: New Jersey Department of Environmental Protection (NJDEP)
Comment:
New Jersey Department of Environmental Protection (NJDEP)
[These comments were submitted as testimony at the Philadelphia, Pennsylvania public hearing on August 26, 2010.  See Docket Number EPA-HQ-OAR-0491-1938, pp.157 & 161.]
committing to a second phase of the Transport Rule to achieve additional and necessary emissions reductions to address all NAAQS.