SO2 Trading Program as a logical outgrowth of the December
2014 proposed rule. We agree that the December 2014 proposed rule was a
part of a different rulemaking process, which is supported by the fact
that we did not reference that proposed rule in developing the
intrastate trading program that was finalized in October 2017. We also
did not reference the December 2014 proposal in our August 2018
proposal to affirm the October 2017 final rule.
---------------------------------------------------------------------------

    \159\ 79 FR 74818.
    \160\ See 81 FR 296, 301-02 (Jan. 5, 2016).
---------------------------------------------------------------------------

    Comment: We received a comment from environmental groups asserting
that the fact that Texas state agencies and industry submitted comments
in

support of a trading program does not make the October 2017 final rule
promulgating the Texas SO2 Trading Program a ``logical
outgrowth'' of EPA's 2014 proposal given that EPA did not provide
notice to the public that it was proposing or even considering a
trading program. The commenter asserted that the D.C. Circuit has
``made clear that the fact that some commenters actually submitted
comments addressing the final rule is of little significance. The
agency must itself provide notice of a regulatory proposal,'' citing
Ass'n of Private Sector Colls. v. Duncan, 681 F.3d 427, 462 (D.C. Cir.
2012) (citation omitted) (internal quotation marks omitted). The same
environmental groups asserted that they did not have an opportunity to
comment on information that arose in the October 2017 final rule
promulgating the Trading Program, including the consideration of a
trading program as a BART alternative to satisfy BART, the specifics of
EPA's intrastate trading program, or the rationale for adopting that
program. The environmental groups asserted that while they submitted
comments on BART alternatives in response to the comments submitted by
industry--those comments were not based on, or responding to, any
actual or implied proposal by EPA to adopt such an alternative. The
environmental groups contended that their response to industry comments
about industry's desire for a trading program is not a substitute for
having notice and opportunity to comment on EPA's decision to
promulgate a trading program.
    Response: We do not take the position that any comments on the
January 2017 proposal could have or did provide a basis for treating
the October 2017 final rule as a ``logical outgrowth'' of the December
2014 proposal, so the premise of this comment is incorrect.
Furthermore, the case cited by commenter is inapposite as it does not
arise under the CAA. The CAA contemplates circumstances in which the
Agency may finalize rules under section 307(d) that reflect changes
from proposal that a commenter is unable to comment on. The appropriate
remedy, when circumstances warrant, is administrative reconsideration,
so that the agency is able to provide the public the opportunity to
comment on those matters (or ``objections'') that are of ``central
relevance'' to the outcome of the rule. See Wisconsin v. EPA, 938 F.3d
303, 331-32 (D.C. Cir. 2019). The commenter's concerns regarding
logical outgrowth have now been addressed by our August 27, 2018
proposal that specifically solicited comment on all key aspects of the
Texas SO2 Trading Program. We are finalizing that proposal
with amendments to certain provisions of the Trading Program after
considering and responding to all comments within scope that we
received during the public comment periods for the August 2018 proposal
and the November 2019 supplemental proposal.
    Comment: We received comments from environmental groups asserting
that EPA did not provide responses to certain comments they submitted
during the public comment period for our January 2017 proposal. Those
particular comments submitted by the environmental groups were a
reaction to comments submitted by industry to EPA--also during the
public comment period for our January 2017 proposal--urging us to
consider as a BART alternative the concept of emission caps using CSAPR
allocations in place of source-specific SO2 BART controls.
Specifically, the comments the environmental groups claim EPA did not
respond to asserted that CSAPR is not better than BART. The commenters
contended that EPA had an obligation to respond to those comments given
EPA's reliance on CSAPR to justify the Texas SO2 Trading
Program, and that in not providing a response, EPA violated the CAA's
requirement that a rule ``be accompanied by a response to each of the
significant comments, criticisms, and new data submitted in written or
oral presentations during the comment period.'' 42 U.S.C.
7607(d)(6)(B).
    Response: We provided responses in the October 2017 final rule to
each of the in-scope significant comments, criticisms, and new data
submitted in written or oral presentations during the comment period.
We continue to hold the position that comments alleging that CSAPR is
not better than BART were beyond the scope of our January 4, 2017
proposed rule, and they are beyond the scope of our final action now.
We continue to believe that such comments raise issues that are
appropriately addressed in the record of the 2012 CSAPR Better-than-
BART rule \161\ and our 2017 affirmation of CSAPR Better-than-
BART.\162\ In this action, the EPA is relying on the conclusion reached
in those actions, without reopening them or having any intention to
reopen them, that CSAPR remains a valid BART-alternative, including
after taking account of geographic changes in the scope of CSAPR's
coverage since 2012. In particular, because the Texas SO2
Trading Program, as amended in this final action, has been designed to
achieve SO2 emission levels from Texas EGUs that are similar
to or less than what would have been realized from Texas EGUs'
participation in the CSAPR SO2 trading program, we are
making the determination that the Texas SO2 Trading Program
is an appropriate BART alternative for addressing Texas' SO2
BART obligations. Because the Texas SO2 Trading Program will
result in SO2 emissions from Texas EGUs similar to or less
than emissions anticipated under CSAPR, this alternative is an
appropriate approach for addressing Texas' SO2 BART
obligations and, in the context of the operation of the CSAPR ozone-
season NOX trading program and the operation of the CSAPR
annual NOX and SO2 trading programs, will achieve
greater reasonable progress than BART towards restoring visibility,
consistent with the June 2012 ``CSAPR Better-than-BART'' determination
and September 2017 ``CSAPR Better-than-BART affirmation finding.'' As
discussed in section I.D of this final action, EPA has denied a
petition for reconsideration of the 2017 CSAPR Better-than-BART
affirmation that was based in part on an objection that the Texas
program is not of sufficient stringency to satisfy the analysis for
CSAPR. Although our determination in that action is also beyond the
scope of this action here, it means that EPA here can continue to rely
on the CSAPR ``Better-than-BART'' finding in conducting its analysis of
whether the Texas intrastate trading program satisfies the requirements
of 40 CFR 51.308(e)(2).
---------------------------------------------------------------------------

    \161\ 77 FR 33641.
    \162\ 81 FR 74504.
---------------------------------------------------------------------------

    Comment: One commenter asserted that EPA's August 2018 proposal
affirming the October 2017 final rule promulgating the Texas
SO2 Trading Program and solicitation of comments on only
some elements of the Texas SO2 Trading Program cannot cure
the rule's procedural deficiencies in finalizing the trading program
because the opportunity for public comment is both insufficient and too
late. The commenter contended that based on case law, the purpose of
notice and comment is to provide the public with an opportunity to
influence agency rulemaking, citing U.S. Steel Corp. v. EPA, 595 F.2d
207, 215 (5th Cir. 1979); Nat'l Tour Brokers Ass'n v. U.S., 591 F.2d
896, 902 (D.C. Cir. 1978). The commenter claimed that this opportunity
to influence agency rulemaking is meaningful only when rules remain in
the formative stage and agencies are more likely to give real
consideration to alternative ideas. Furthermore, the commenter asserted

that agencies do not provide an adequate opportunity to influence the
rulemaking process when they solicit public comment on rules that they
have already labeled as final, as in the case of the Texas
SO2 Trading Program. The commenters stated that the October
2017 FIP promulgating the Texas SO2 Trading Program remained
in effect even while it was open to public comment, thus not providing
the public with a meaningful opportunity to influence the trading
program. Additionally, the commenter noted that EPA has not yet
rescinded or withdrawn the FIP promulgating the Texas SO2
Trading Program even though environmental groups filed a petition for
reconsideration arguing that the Texas SO2 Trading Program
did not follow notice and comment requirements. According to the
commenters, in having the Texas SO2 Trading Program remain
in effect, EPA has continued to violate the CAA's notice and comment
provisions.
    The commenter asserted that the D.C. Circuit explained in Nat'l
Tour Brokers Ass'n, 591 F.2d at 902, that agencies are likely to become
more close-minded and defensive once they put their credibility on the
line in the form of final rules. Furthermore, the commenter argued that
agencies cannot cure notice and comment defects by merely soliciting
comments after the promulgation of a final rule. The commenter asserted
that when an agency seeks to save a rule that suffers from a notice and
comment violation, that agency bears the burden of proving that the
violation did not prejudice the public and that the absence of such
prejudice must be clear for the violation to be considered ``harmless''
and the rule to be upheld. The commenter claimed that at this point,
the only legal remedy is for EPA to withdraw the Texas SO2
Trading Program and replace it with a FIP that satisfies the statutory
and regulatory requirements.
    Response: In response to the petition for reconsideration
referenced by the commenters, we decided that the October 2017 final
rule could benefit from further public comment.\163\ As a result, in
our August 2018 proposed rule, we proposed to affirm our FIP
promulgating the Texas SO2 Trading Program and in doing so,
we provided the public with an opportunity to comment on all centrally
relevant aspects of the October 2017 final rule, including our
promulgation of the Texas SO2 Trading Program and our
determination that this program satisfies the requirements for a BART
alternative.\164\ We disagree with the commenter that the opportunity
for public comment provided by our August 27, 2018 proposed rule is
insufficient and too late. While the October 2017 final rule remained
in effect when we proposed the August 27, 2018 proposal, in that
proposal we also sought input on whether SO2 BART would be
better addressed through a source-by-source approach (source-specific
BART), the October 2017 SO2 trading program, or some other
appropriate BART alternative. We stated in the August 27, 2018 proposal
that if we were to decide to act pursuant to any comments we receive,
we may initiate a new rulemaking process with a new proposed rule.\165\
We provided a 60-day public comment period that ended on October 26,
2018 and held a public hearing on September 26, 2018, to receive public
comment on our August 27, 2018 proposed rule. As a result of comments
received during that comment period, we subsequently published and took
further comment on a supplemental proposal in November 2019 to make
changes to certain provisions of the Texas SO2 Trading
Program. Our November 2019 supplemental proposal and the amendments to
the trading program we are finalizing in this action are evidence that
our intent was to be open to further comment and that we ultimately
gave real consideration and were influenced by the comments we
received. Therefore, we disagree that we have not provided the public a
fully adequate opportunity to influence the agency's rulemaking or that
the public notice and opportunity to comment on our proposals was not
meaningful.
---------------------------------------------------------------------------

    \163\ 83 FR 43586.
    \164\ 83 FR 43586 at 43590.
    \165\ 83 FR at 43587.
---------------------------------------------------------------------------

    In this respect, our actions are consistent with the requirements
of the CAA under section 307(d). The CAA contemplates that in some
circumstances the public may not be able to comment on important
aspects of a final rule. The appropriate remedy is reconsideration to
afford that opportunity for comment, and thus provide for
administrative exhaustion prior to judicial review, with respect to all
``centrally relevant'' objections to the final rule. The August 2018
proposal afforded the opportunity to comment on all such objections
with respect to the October 2017 final action.
    The CAA also contemplates that a final rule may remain in effect
while the EPA undertakes that reconsideration. Even when the EPA is
undertaking a mandatory reconsideration process under section
307(d)(7)(B), the statute provides that the rule ``may be stayed''
(emphasis added) by the Administrator or a court for a period not to
exceed three months. The fact that the Texas SO2 Trading
Program remained in effect and went into operation during the pendency
of the public notice and comment periods in this instance does not in
any manner establish that the agency's notice and comment process on
the August 2018 proposal to reaffirm the final rule is somehow infirm,
or that any alleged defects in the procedure for the October 2017 final
rule are somehow incurable.
    Further, the cases cited by commenter are inapposite because they
were not subject to the provisions of CAA section 307(d). In U.S. Steel
Corp. v. EPA, 595 F.2d 207 (5th Cir. 1979), for instance, the court
reviewed EPA's designation of nonattainment areas under section 107 of
the Act. Designations under section 107 are not amongst the enumerated
actions in section 307(d) of the Act that are governed by the
administrative rulemaking procedures of subsection (d), including the
provision for mandatory reconsideration under section 307(d)(7)(B).
Thus, the court in U.S. Steel Corp. was reviewing EPA's action under
the Administrative Procedure Act. See 595 F.2d at 210. The Texas
SO2 Trading Program is a federal implementation plan
promulgated under section 110(c) of the CAA, and thus subject to
section 307(d), pursuant to section 307(d)(1)(B). The court in U.S.
Steel was not confronted with a circumstance in which the agency
promulgated a final rule subject to the provisions of CAA section
307(d) that was substantially different from the proposal, but then
took the necessary steps to provide the opportunity for comment on all
centrally relevant issues, consistent with the process contemplated in
section 307(d)(7)(B). Thus, the U.S. Steel Corp. case cited by the
commenter is not relevant to our final action on the Texas
SO2 Trading Program here.
    Comment: One commenter expressed general concern that EPA proposed
to affirm the October 2017 final rule that promulgated the Texas
SO2 Trading Program in the August 2018 proposal without
soliciting comments on certain sections of the final rule.
    Response: In response to a petition for reconsideration of the
October 2017 final rule requesting that the Administrator reconsider
certain aspects of the FIP related to the Texas SO2 Trading
Program, we decided that important aspects of the October 2017 federal
plan could benefit from further

public comment.\166\ Accordingly, in a notice published on August 27,
2018, we proposed to affirm certain aspects of the October 2017 final
rule, and thus opened for comment the following elements, which
effectively covered all of the central objections in the petition for
reconsideration: (1) The proposal to affirm the October 2017 FIP
establishing an intrastate trading program addressing emissions of
SO2 from certain EGUs in Texas as a BART alternative and the
determination that this program satisfies the requirements for BART
alternatives; (2) the proposal to affirm the finding that the BART
alternatives in the October 2017 rulemaking to address SO2
and NOX BART at Texas' EGUs result in emission reductions
adequate to satisfy the requirements of CAA section 110(a)(2)(D)(i)(II)
with respect to visibility for the following NAAQS: 1997 8-hour ozone,
1997 PM2.5 (annual and 24-hour), 2006 PM2.5 (24-
hour), 2008 8-hour ozone, 2010 1-hour NO2, and 2010 1-hour
SO2 NAAQS; and (3) the proposal to affirm our October 2017
approval of Texas' SIP determination that no sources are subject to
BART for PM. The August 2018 affirmation proposed rule also solicited
comment on the specific issues of whether recent shutdowns of sources
included in the trading program and the merger of two owners of
affected EGUs should impact the allocation methodology for certain
SO2 allowances. In addition to soliciting comment on the
above elements and aforementioned specific issues, the August 2018
affirmation proposal also invited comment on additional issues that
could inform our decision making with regard to the SO2 BART
obligations for Texas. First, we sought input on whether SO2
BART would be better addressed through a source-by-source approach
(source-specific BART), the October 2017 SO2 trading
program, or some other appropriate BART alternative. Second, EPA
requested comment on whether a SIP-based program would serve Texas
better than a FIP. Third, we requested public input on whether and how
the SO2 trading program finalized in the October 2017 final
rule addresses the long-term strategy and reasonable progress
requirements for Texas. We find that the issues that EPA enumerated for
reconsideration and solicitation of public comment covered all
centrally relevant aspects of the October 2017 rule. See 83 FR at
43587. As noted by the commenter, we recognize that there were certain
aspects of our October 2017 final rule that we did not reopen and thus
did not solicit further comment on in our August 2018 proposal. We did
not reopen or solicit comment on the following: our October 2017 final
determination that CSAPR addresses the NOX BART requirements
for EGUs in Texas; identification of BART-eligible sources; and our
determination that the BART-eligible EGUs not participating in the
Texas SO2 Trading Program were not causing or contributing
to visibility impairment, and were therefore not subject to BART. We
did not reopen and solicit further comment on these determinations made
in the October 2017 final rule because these aspects of our final rule
were finalized as proposed in the January 2017 proposal after carefully
considering and responding to all comments within scope that we
received during the public comment period.
---------------------------------------------------------------------------

    \166\ 83 FR 43586.
---------------------------------------------------------------------------

G. Subject-to-BART Determinations

    Comment: We received a comment from Lower Colorado River Authority
(LCRA) stating their Fayette Power Plant Units 1 & 2 (FPP U1 & U2) are
not subject to BART, contrary to the determination made by EPA in the
January 2017 FIP proposal. The commenter asserted that EPA improperly
used data from 2000-2004, which pre-dated the installation of wet flue
gas desulfurization scrubbers at the units, to assess visibility
impacts of FPP U1 & U2. Although the commenter did not request that EPA
remove FPP U1 & U2 from the Texas SO2 Trading Program at
this time, and actually expressed support of the Texas FIP and the
inclusions of FPP U1 & U2 in the trading program, the commenter
requested that EPA concur that the most currently available data must
be used for visibility impact determinations under the regional haze
program.
    Response: We appreciate LCRA's concerns regarding Fayette Power
Plant Units 1 and 2, and we agree that Fayette Units 1 and 2 are
currently equipped with high performing wet FGDs. We note that, as
discussed in our October 2017 final rule and as affirmed in this
rulemaking, we are not making a subject-to-BART determination for those
sources covered by the Texas SO2 Trading Program. The
relevant BART requirement for the participating BART-eligible units are
encompassed by BART alternatives for NOX and SO2
such that we did not deem it necessary to finalize subject-to-BART
findings for these EGUs. In addition, we are affirming our approval of
the determination in the 2009 Texas Regional Haze SIP that none of
these sources are subject to BART for PM. Therefore, comments
concerning the emissions utilized in our subject-to-BART modeling for
the sources participating in the SO2 trading program are no
longer relevant.

H. Visibility Transport

    Comment: One commenter asserted that EPA's reliance on the Texas
SO2 Trading Program to satisfy section 110(a)(2)(D)(i)(II)
is arbitrary and capricious both because the Texas SO2
Trading Program itself is unlawful and because EPA's reliance on the
Texas SO2 Trading Program here is based on EPA's claims that
the Texas SO2 Trading Program reduces emissions as much as
CAIR would have. According to the commenter, this is problematic
because EPA cannot use CAIR, given that CAIR was invalidated years ago
by the D.C. Circuit, citing North Carolina, 531 F.3d at 903, and has
been replaced by CSAPR. Thus, the commenter contended that EPA cannot
use CAIR as the benchmark for whether the interstate visibility
transport requirements are met. The commenter also asserted that EPA
disapproved Texas' regional haze plan precisely because it relied on
CAIR and that it is arbitrary and capricious for EPA to now turn around
and claim that interstate visibility transport requirements are
satisfied because the emissions reductions in CAIR will be achieved.
    The commenter also asserted that EPA's new rationale of relying on
the emission levels assumed in the CENRAP modeling as a basis for
finding that Texas' emissions will not interfere with other states'
visibility plans is not appropriate given that there is no
demonstration provided to show that the emission assumptions used by
CENRAP in its visibility modeling are in fact sufficient to assure that
Texas emissions do not interfere with measures required to protect
visibility in other states. The commenter also expressed concern that
certain states, such as New Mexico and Colorado, impacted by Texas
emissions are not members of CENRAP, and therefore, the CENRAP process
could not have determined what emissions limits were necessary to
satisfy Texas' visibility transport obligations with respect to New
Mexico and Colorado.
    Response: First, we address comments regarding the Texas
SO2 Trading Program as being unlawful, arbitrary, or
capricious, elsewhere in this document. Second, the Texas
SO2 Trading Program, as promulgated in October 2017 and with
the amendments promulgated in this final rule, results in emission
reductions that are adequate to satisfy Texas' visibility transport
obligations under CAA section 110(a)(2)(D)(i)(II) for the following six
NAAQS: (1) 1997 8-hour ozone; (2) 1997 PM2.5 (annual and

24 hour); (3) 2006 PM2.5 (24-hour); (4) 2008 8-hour ozone;
(5) 2010 1-hour NO2; and (6) 2010 1-hour SO2. The
2009 Texas Regional Haze SIP relied on participation in CAIR to meet
the SO2 BART requirements for Texas EGUs, and this level of
emissions reductions from Texas is what other states relied upon and
assumed during interstate consultation and in the development of their
long-term strategies and reasonable progress goals for their own Class
I areas in their regional haze SIPs. As discussed in section III.B of
this notice, Texas EGU sources were projected to emit approximately
350,000 tons of SO2 annually under CAIR participation. By
comparison, Texas EGUs are anticipated to emit no more than
approximately 290,083 tons of SO2 annually under the Texas
SO2 Trading Program (i.e., 255,083-ton assurance level +
estimated 35,000 tons per year of emissions from units not covered by
the Texas SO2 Trading Program), which is well below the
350,000-ton emissions projection for Texas sources under CAIR and well
below the maximum total annual SO2 emissions assumed for
Texas under CSAPR (i.e., 317,000 tons) in the CSAPR Better-than-BART
analysis. Thus, the Texas SO2 Trading Program as amended in
this final action, ensures SO2 emission reductions from
Texas that are consistent with, and indeed greater than, the level of
emission reductions relied upon by other states during interstate
consultation and thus this level of emissions reductions is adequate to
satisfy the requirements of CAA section 110(a)(2)(D)(i)(II) with
respect to visibility for the six identified NAAQS.\167\
---------------------------------------------------------------------------

    \167\ 83 FR 43605.
---------------------------------------------------------------------------

    The commenter makes the claim that CENRAP's modeling of emission
assumptions does not necessarily demonstrate that those assumptions
were in fact sufficient to assure non-interference by Texas' emissions
with measures required to protect visibility in other states. We note
that our 2013 infrastructure-SIP guidance addressing the interstate
visibility transport requirements of the Act (also sometimes referred
to as ``prong 4'') lays out two ways in which a state's infrastructure
SIP submittal may satisfy these requirements.\168\ One way is through a
state's confirmation in its infrastructure SIP submittal that it has an
EPA-approved regional haze SIP in place. In the absence of a fully
approved regional haze SIP, the second method to meet these
requirements is a demonstration that emissions within a state's
jurisdiction do not interfere with other states' plans to protect
visibility. Such a demonstration should point to measures that limit
visibility-impairing pollutants and ensure that the resulting
reductions conform with any mutually agreed emission reductions under
the relevant regional haze regional planning organization (RPO)
process.\169\ Given that the emissions under the Texas SO2
Trading Program--including the assurance provisions--are less than the
level of Texas emissions reductions agreed upon by Texas and other
states during consultation and assumed and relied upon in those other
states' regional haze SIPs, we continue to find that the FIP is
adequate to ensure that emissions from Texas do not interfere with
measures to protect visibility in nearby states.
---------------------------------------------------------------------------

    \168\ See ``Guidance on Infrastructure State Implementation Plan
(SIP) Elements under CAA sections 110(a)(1) and 110(a)(2)''
(September 13, 2013).
    \169\ See id. ``Guidance on Infrastructure State Implementation
Plan (SIP) Elements under CAA sections 110(a)(1) and 110(a)(2),'' at
34 (September 13, 2013). See also 76 FR 22036 (April 20, 2011)
(containing EPA's approval of the visibility requirement of
110(a)(2)(D)(i)(II) based on a demonstration by Colorado that did
not rely on the Colorado Regional Haze SIP).
---------------------------------------------------------------------------

    The commenter also makes the claim that there is no rational basis
for EPA's reliance on the emission levels assumed in CENRAP modeling as
a basis for finding that Texas' emissions will not interfere with other
states' visibility plans given that there are states whose visibility
is impacted by Texas that are not members of CENRAP. Our basis for
determining that the FIP is adequate to ensure that emissions from
Texas do not interfere with measures to protect visibility in nearby
states is that the emissions reductions secured under the Texas
SO2 Trading Program are consistent with the level of
emissions reductions relied upon by other states during consultation,
which is not limited to consultation amongst CENRAP states.\170\ The
Regional Haze Rule requires that ``Where a state has emissions that are
reasonably anticipated to contribute to visibility impairment in any
mandatory Class I Federal area located in another State or States, the
State must consult with the other State(s) in order to develop
coordinated emission management strategies.'' \171\ Clearly, this
requirement applies regardless of whether the impacted states are
members of the same regional planning organization (RPO) or not. Thus,
Texas had an obligation to consult with states, both in and outside of
CENRAP, whose Class I areas are potentially impacted by Texas
emissions. As documented in the 2009 Texas Regional Haze SIP,\172\
Texas participated in inter-regional planning organization calls during
the SIP development process for the first planning period. Texas also
sent consultation letters to Oklahoma, Louisiana, Missouri, Arkansas,
Colorado and New Mexico. Included with each letter was a discussion of
the CENRAP Particulate Matter Source Apportionment Technology (PSAT)
modeling determining the contribution from each Texas source area to
visibility impairment at Class I areas in the given state. In the 2009
SIP, Texas asserted that it participated fully in the analysis of this
data, including estimation of the base period visibility impairment,
natural visibility condition estimates, and 2018 projections based on
current (at that time) and anticipated future state and federal
controls. For states outside of CENRAP, Texas documented in its 2009
SIP that Colorado's Department of Public Health and Environment
confirmed in a letter dated June 24, 2008, that no further emissions
reductions were requested of Texas at that time. Texas also documented
that as of December 2008, shortly before its submission of the final
SIP to EPA on March 19, 2009, New Mexico had not responded to Texas'
letter to confirm whether or not New Mexico was expecting any
additional emission reductions from Texas sources. Furthermore, New
Mexico did not include in its Regional Haze SIP any additional emission
reductions expected from Texas sources. The Texas emissions reductions
that will result from the Texas SO2 Trading Program and
Texas' participation in CSAPR for ozone season NOX are
consistent with the level of Texas emissions reductions relied upon by
other states both in and outside CENRAP during consultation with Texas.
---------------------------------------------------------------------------

    \170\ See CFR 51.308(d)(3)(i)-(iii) addressing the requirements
for consultation with other states.
    \171\ 40 CFR 51.308(d)(3)(i).
    \172\ See 2009 Texas Regional Haze SIP, section 4.3 titled
``Consultations On Class I Areas In Other States.'' The submittal
can be found in Regulations.gov docket ID EPA-R06-OAR-2016-0611,
document EPA-R06-OAR-2016-0611-0002.
---------------------------------------------------------------------------

    It is incorrect to claim that because CAIR was invalidated, EPA and
the states can no longer use the anticipated emissions and reasonable
progress goals established through the consultation process for the
first planning period. Those goals may have been established in part
based on expectations of emissions performance under CAIR, but the
anticipated emissions reductions and the goals for regional haze
purposes remain in effect (though we note that reasonable progress
goals are not binding). Thus, this level of emissions

provides an appropriate benchmark for assessing whether states are
adequately addressing interstate visibility transport (when such a
demonstration is necessary). We note that this is different than
situations in which states have attempted to rely on CAIR as a BART
alternative despite the fact that CAIR is no longer in operation. Here,
the fact that CAIR no longer exists and has been replaced by CSAPR does
not impact the legitimacy of the level of emission reductions agreed
upon through the consultation process among states, particularly given
that CSAPR is generally more stringent than CAIR. And here, the Texas
program is designed to be more stringent than CSAPR would have been for
SO2 emissions in Texas. See section III.B where we provided
detailed analysis of anticipated emissions under CAIR and the Texas
program. Therefore, we find that Texas' visibility transport
obligations under CAA section 110(a)(2)(D)(i)(II) for the six NAAQS
listed above are satisfied.
    Comment: We received one comment asserting that since EPA has not
made any determination of the trading program's visibility impacts on
other states, we cannot make the claim that the Texas SO2
Trading Program was designed to meet the CAA's visibility transport
requirements. The commenter claimed that EPA cannot lawfully claim that
the Texas SO2 Trading Program was designed to meet the
visibility transport requirements of the CAA because the CAA's
visibility good neighbor provision requires and authorizes EPA to
prohibit only those upwind emissions that interfere with measures
required to be included in the applicable implementation plan for any
other State. The commenter cited 42 U.S.C. 7410(a)(2)(D)(i)(II), as
well as E.P.A. v. EME Homer City Generation, L.P., 134 S.Ct. 1584, 1604
(2014) and EME Homer City II, 795 F.3d at 127. The commenter asserted
that if one applies to this case the Supreme Court's precedent
interpreting the analogous good neighbor provision under Section
7410(a)(2)(D)(i)(I), EPA is not required and does not have authority to
regulate upwind emissions unless it first makes the predicate finding
that those upwind emissions interfere with downwind visibility. The
commenter further asserted that if the EPA makes that finding, even
then it may only regulate upwind emissions up to the amounts of
pollution that actually interfere with downwind visibility, again
citing EPA v. EME Homer City Generation, L.P., 134 S.Ct. 1584, 1603
(U.S. 2014) and EME Homer City II, 795 F.3d at 127. The commenter
contended that in affirming its October 2017 final rule that
promulgated the Texas SO2 Trading Program, EPA failed to
make the predicate finding that emissions from Texas are interfering
with downwind states' attainment of the NAAQS and that EPA, therefore,
cannot properly claim that the Texas SO2 Trading Program was
designed to meet the agency's good neighbor ``requirement'' to protect
downwind visibility from ``interfere[nce].''
    Response: We disagree that the Texas SO2 Trading Program
cannot be viewed as a program ``designed to meet a requirement other
than BART'' for purposes of the BART alternative analysis under 40 CFR
51.308(e)(2)(i)(C). As relevant to this comment, the Texas program is
designed, among other things, to ensure reductions of SO2
emissions from EGU sources in Texas that meet (and indeed are more
stringent than) the reductions agreed to in the interstate consultation
process for setting RPGs for Class I areas in other states. See section
III.B of this notice, where we explain that the Texas SO2
Trading Program as amended in today's final action ensures emission
reductions in Texas that are adequate to satisfy the requirements of
CAA section 110(a)(2)(D)(i)(II) with respect to visibility for six
NAAQS.
    We disagree with the commenter that EPA has not made allegedly
necessary predicate findings under prong 4 in order to claim that the
Texas program is designed to meet prong 4 requirements. The commenter
incorrectly attempts to import into the interstate visibility transport
analysis under prong 4 the policy determinations, regulatory design,
and associated case law of the ``good neighbor provision'' at
110(a)(2)(D)(i)(I), related to addressing significant contribution to
nonattainment and interference with maintenance of the NAAQS in other
states, which we commonly refer to as prongs 1 and 2. Those precedents
are not necessarily applicable given that the agency has long had a
different framework for analysis under prong 4, with an entirely
different set of policy guidance and administrative precedents. As
explained above, our interpretation of section 110(a)(2)(D)(i)(II) with
respect to visibility transport is that one of the pathways by which a
state can meet its visibility transport obligations is through a
demonstration that emissions within a state's jurisdiction do not
interfere with other states' plans to protect visibility. EPA's
September 13, 2013 guidance explains that such a demonstration should
point to measures that limit visibility-impairing pollutants and ensure
that the resulting reductions conform with any mutually agreed emission
reductions under the relevant regional haze regional planning
organization (RPO) process.\173\ This has been EPA's long-standing
interpretation of how a state's visibility transport obligations can be
satisfied, and we have since approved many SIPs and promulgated FIPs
that address CAA section 110(a)(2)(D)(i)(II) with respect to visibility
transport through this pathway. Texas participated in the CENRAP
process in developing its SIP for the first planning period and relying
on the technical work developed through that process, Texas identified
states with Class I areas impacted by Texas emissions and those states
agreed that they are being impacted by emissions from Texas sources.
Furthermore, through the consultation process, Texas made a commitment
to states with Class I areas impacted by emissions from Texas sources
that it would implement CAIR to satisfy its BART requirements and those
states agreed with Texas that anticipated emission reductions due to
the implementation of CAIR would be sufficient to address Texas'
impacts at their Class I areas. The impacted states relied on this
level of emission reductions from Texas sources in developing their
SIPs and establishing their RPGs. As discussed in section III.B. of
this action, given that the revisions to the Texas SO2
Trading Program we are finalizing in today's final action ensure
emission reductions consistent with and below the emission levels
agreed upon by all states during interstate consultation under 40 CFR
51.308(d)(3)(i)-(iii) and relied upon by states impacted by Texas
emissions, we find that these revisions provide further support for our
earlier finding that the BART alternative in the October 2017 FIP
results in emission reductions adequate to satisfy the requirements of
CAA section 110(a)(2)(D)(i)(II) with respect to visibility for the six
identified NAAQS.\174\
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    \173\ See ``Guidance on Infrastructure State Implementation Plan
(SIP) Elements under CAA sections 110(a)(1) and 110(a)(2),'' at 34
(September 13, 2013). See also 76 FR 22036 (April 20, 2011)
containing EPA's approval of the visibility requirement of
110(a)(2)(D)(i)(II) based on a demonstration by Colorado that did
not rely on the Colorado Regional Haze SIP.
    \174\ See 2009 Texas Regional Haze SIP, section 4.3 titled
``Consultations On Class I Areas In Other States.'' The submittal
can be found at www.regulations.gov, Docket ID EPA-R06-OAR-2016-
0611, Document ID EPA-R06-OAR-2016-0611-0002.
---------------------------------------------------------------------------

    Further, EPA has requisite FIP authority under CAA section 110(c)
to address prong 4 for the six NAAQS for

Texas, given our disapproval of the state's prong 4 submittals. See 82
FR at 48332. Thus, our position is that we have the obligation and
authority to address Texas' interstate visibility transport
obligations. With the emission levels established by the Texas
SO2 Trading Program, as promulgated in October 2017 and
amended by this final rule, we affirm our finding that the emission
levels assumed in the CENRAP modeling are in fact sufficient to assure
that Texas' emissions do not interfere with other states' visibility
plans, and that Texas is achieving emission reductions that satisfy
prong 4 obligations with respect to the six aforementioned NAAQS. For
the reasons just discussed, we can also determine that the intrastate
program is ``designed to meet a requirement other than BART'' for
purposes of 51.308(e)(2)(i)(C).
    We also disagree with the comment that EPA does not have the
authority to regulate Texas' emissions with respect to visibility
without first making the finding that emissions from Texas are
interfering with downwind states' attainment of the NAAQS. The
visibility prong (or ``prong 4'') of CAA section 110(a)(2)(D)(i)(II)
requires that the implementation plan submitted by a state contain
adequate provisions prohibiting any source or other type of emissions
activity within the State from emitting any air pollutant in amounts
that will interfere with measures required to be included in the
applicable implementation plan for any other state to protect
visibility. Prong 4 is concerned with visibility and there is no
requirement that EPA first make a finding that a state is interfering
with downwind states' attainment of the NAAQS before approving a SIP or
promulgating a FIP that addresses CAA section 110(a)(2)(D)(i)(II) with
respect to visibility transport.
    While the commenter is correct that the regional planning process
by which Texas and surrounding states developed their regional haze
SIPs took place more than a decade ago and in the interim CAIR has been
invalidated and replaced by CSAPR, given that the implementation of
CAIR in Texas is what Texas committed to and what impacted states
agreed with and relied upon in developing their own regional haze SIPs,
we continue to find that it is appropriate to compare the emissions
reductions anticipated from CAIR to the Texas SO2 Trading
Program to determine whether the FIP is adequate to ensure that
emissions from Texas do not interfere with measures to protect
visibility in nearby states as required under CAA section
110(a)(2)(D)(i)(II). We recognize that the process of taking action on
certain SIPs related to regional haze for the first planning period and
interstate visibility transport has taken longer than EPA originally
anticipated when it first promulgated the Regional Haze Rule in 1999.
Notwithstanding this delay, we do not believe it would be reasonable or
practical at this time to require states with outstanding visibility
transport obligations to revisit and/or update their emission reduction
commitments to impacted states for the first implementation period.
Such a process could potentially be time and resource intensive at a
time when states are currently focusing their attention on developing
regional haze implementation plans for the second implementation
period. Thus, we do not believe it would not be reasonable or practical
at this time to require Texas to revisit its emission reduction
commitments to states with Class I areas impacted by Texas emissions
for the first implementation period.
    We address other comments that EPA must analyze BART on a source-
by-source basis elsewhere in this document.

I. Reasonable Progress

    Comment: We received a comment asserting that the Texas
SO2 Trading Program cannot possibly be designed to satisfy
the reasonable progress requirements for several reasons. As an initial
matter, the commenter claimed that EPA was attempting to bypass the
source-specific analyses required under Sec.  51.308(e)(2)(i)(C) by
simply asserting that the trading program was designed to be part of
the long-term strategy to meet reasonable progress requirements.
Additionally, the commenter asserted that EPA's claim that the Texas
SO2 Trading Program is somehow designed to meet the
reasonable progress requirements is contradicted by EPA's statement
elsewhere in the August 2018 affirmation proposal that it is not taking
action on the reasonable progress elements that the Fifth Circuit
remanded to the agency. The commenter also claimed that setting aside
this inconsistency, the Texas SO2 Trading Program cannot be
designed to satisfy the reasonable progress requirements given that it
makes no progress at all as the allowances available under the trading
program exceed the covered sources' emissions in 2015, 2016, and 2017,
and thus the Texas SO2 Trading Program will not reduce
emissions or improve visibility. Furthermore, the commenter asserted
that the Texas SO2 Trading Program cannot possibly be
designed to satisfy the reasonable progress requirements because EPA
did not consider the four statutory factors for reasonable progress.
The commenter asserted that EPA must conduct a four-factor analysis of
whether pollution controls are needed at individual sources--whether
subject to BART or not--to make reasonable progress and that the Texas
SO2 Trading Program and the Q/d analysis that helped inform
the trading program cannot act as a substitute for a four-factor
reasonable progress analysis given that there are no statutory or
regulatory exemptions that authorize EPA to forego conducting a
separate reasonable progress analysis or that authorize a reasonable
progress alternative program comparable to a BART alternative.
    Response: As discussed in Section III.A.2 above, we are not
finalizing a position that the Texas SO2 Trading Program is
designed to meet reasonable progress requirements. While the program
will contribute to meeting Texas' reasonable progress requirements, the
necessary analysis, and potentially, emission controls, to fully
address reasonable progress for Texas will take place in a separate,
future action.

J. Coleto Creek

    Comment: We received comments in support of our proposed removal of
the special provisions in the Supplemental Allowance Pool for Coleto
Creek.\175\ We also received a comment stating that the Supplemental
Allowance Pool's treatment of Coleto Creek is unlawful, arbitrary, and
capricious because this provision would allow SO2 emissions
to increase over time. Under Sec.  97.912(a)(3)(i), if Coleto Creek
requires more allowances to be in compliance, those allowances will be
provided up to the amount held in the Supplemental Allowance Pool.
Because that pool's starting balance is 10,000 tons and given that
Coleto Creek's 2016 SO2 emissions totaled 8,231 tons, Sec.
97.912(a)(3)(i) would allow this unit to more than double its 2016
SO2 emissions. Nothing in the Texas SO2 Trading
Program would prevent Coleto Creek from increasing its SO2
emissions to even higher levels, if and when the Supplemental Allowance
Pool has accumulated allowances in excess of 10,000 tons.
---------------------------------------------------------------------------

    \175\ We note that TCEQ commented in support of removing the
special provisions for Coleto Creek but suggested that implementing
changes to the program is a potential concern given that the program
began in January 2019. TCEQ encourages the EPA to discuss with
program stakeholders appropriate timing for making a change to the
Supplemental Allowance Pool. Our final rule sets the effective date
of the rule changes for program year 2021.

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

    The commenter further asserts that because Vistra and Dynegy have
merged, the rationale for having special provisions for Coleto Creek
are longer true, with the combined Dynegy-Vistra company owning several
units other than Coleto Creek covered by the Texas SO2
Trading Program. Given that the factual basis for this provision
concerning Coleto Creek is no longer true, the commenter suggests that
EPA must eliminate 40 CFR 97.912(a)(3)(i).
    We also received comments suggesting that we should eliminate the
additional flexibility afforded to Coleto Creek's owner in the
Supplemental Allowance Pool of the SO2 trading program FIP
because Coleto Creek is no longer an isolated unit in the program.
Given the recent merger between Dynegy and Vistra Energy, which owns or
operates several other Texas EGUs that are subject to the Texas
intrastate trading program for SO2, Coleto Creek will now be
part of a larger set of participating units under the same owner/
operator. Because Coleto Creek is no longer at a disadvantage as it was
before, the flexibility afforded to Coleto Creek under the Supplemental
Allowance Pool is no longer necessary. Vistra Energy will be able to
transfer allowances among the multiple participating units should any
one source require additional allowances during any control period
greater than its allocation, including Coleto Creek. Eliminating the
flexibility directly afforded to Coleto Creek under 40 CFR 97.912(a)(3)
as a result of the merger will provide an equal opportunity among the
participating sources for access to the Supplemental Allowance Pool.
    Response: When we finalized our Texas SO2 Trading
Program FIP in October 2017, all sources required to participate in the
trading program had the flexibility to transfer allowances among
multiple participating units under the same owner/operator when
planning operations, with the exception of Coleto Creek, which consists
of only one coal-fired unit, and at the time of our October 2017 FIP,
this was the only coal-fired unit in Texas owned and operated by
Dynegy. In light of this, in our October 2017 FIP, we provided Coleto
Creek with additional flexibility by allocating its maximum
supplemental allocation from the Supplemental Allowance Pool as long as
there were sufficient allowances in the Supplemental Allowance Pool
available for allocation, and its actual allocation would not be
reduced in proportion with any reductions made to the supplemental
allocations to other sources. In our August 2018 proposal, we noted
that Dynegy had merged with Vistra, which owns other units that are
subject to the trading program. In the August 2018 proposal, we
solicited comment on eliminating this additional flexibility for Coleto
Creek in light of the recent change in ownership, and we received no
adverse comments on such a change. Therefore, on November 14, 2019, we
published a supplemental notice of proposed rulemaking that proposed to
make this change to the regulations.\176\ After considering all
comments we received on our supplemental proposal, we are finalizing
the removal of the special provisions for Coleto Creek, thus making
moot the comments concerning Coleto Creek's treatment under the
Supplemental Allowance Pool.
---------------------------------------------------------------------------

    \176\ 84 FR 61850.
---------------------------------------------------------------------------

    We disagree with the commenter's additional statements that, aside
from the treatment of Coleto Creek just discussed, the Supplemental
Allowance Pool is arbitrary and capricious because it would allow
emissions to increase over time. We have responded elsewhere to the
commenter's similar assertion that the Supplemental Allowance Pool
would ``inflate the cap'' in sections IV.A and IV.K of this final
action.
    Comment: We also received comments from AEP, NRG Texas, SPS, and
Vistra that side with eliminating the additional flexibility to Coleto
Creek due to the recent change in ownership. The additional flexibility
would give Coleto Creek priority for allocations from the Supplemental
Allowance Pool. AEP states that retaining this flexibility would place
Coleto Creek and its owner in a favorable position in comparison to
other utilities operating in the ERCOT, which would unfairly impact
other EGUs. NRG Texas similarly states this additional flexibility
would significantly reduce the allowances available to other sources.
SPS explains that eliminating the additional flexibility will ensure a
more equitable distribution of allowances for EGUs needing compliance
assistance. Vistra submitted comments on both the August 2018 proposal
and the November 2019 supplemental proposal in support of eliminating
the priority given in the October 2017 final rule to Coleto Creek for
allocations from the Supplemental Allowance Pool given that this
priority is no longer necessary in light of the facility's change in
ownership.
    Response: As explained elsewhere in this document, in our August
2018 proposal, we solicited comment on eliminating the additional
flexibility for Coleto Creek in light of the recent change in
ownership, and we received no adverse comments on such a change.
Thereafter, on November 14, 2019, we published a supplemental notice of
proposed rulemaking that proposed to make this change to the
regulations.\177\ After considering all comments we received, we are
finalizing the removal of the special provisions for Coleto Creek, thus
addressing the comments concerning Coleto Creek's treatment under the
Supplemental Allowance Pool.
---------------------------------------------------------------------------

    \177\ 84 FR 61850.
---------------------------------------------------------------------------

K. Assurance Provisions and the Variability Limit

    Comment: One commenter asserted that EPA's proposed assurance
provisions are arbitrary and capricious. Assurance levels, like those
established in CSAPR, are designed to account for year-to-year
variability in each state's EGU emissions. EPA concluded that these
emissions could vary from year to year due to normal fluctuations in
electricity demand, weather, economic considerations, etc., and in an
interstate trading program, state-level budgets would not necessarily
ensure emissions outcomes commensurate with each state's good neighbor
obligations. To address this issue, EPA added ``variability limits'',
which provide additional headroom in the states' budgets. In CSAPR,
these variability limits were based on the maximum historical
percentage coal usage (heat input) variability during 2000-2010
experienced by any CSAPR state. The state budget plus the variability
limit equals the ``state assurance level.'' \178\
---------------------------------------------------------------------------

    \178\ See generally 76 FR 42866 (July 19, 2011).
---------------------------------------------------------------------------

    The commenter asserted that EPA states that the addition of an
assurance limit was the result of comments that EPA's Texas
SO2 Trading Program would (1) not provide any regulatory
pressure on EGUs to reduce their emissions and would actually allow
emissions to increase, and (2) would undermine the stringency of the
program based on the availability of supplemental allowances, the
issuance of allocations to already-retired units, the general method of
allocating allowances, and the availability of unlimited allowance
banking.\179\ The commenter asserted that to address these concerns,
EPA proposed to add an assurance level using the same methodology the
agency used in CSAPR. EPA claims, ``to the extent that commenters
claimed the program would be inadequately stringent due to the
allowance allocation methodology, including allocations to retired
units, or

due to the Supplemental Allowance Pool or allowance banking, these
concerns are effectively rendered moot by the addition of the assurance
level.'' \180\ The commenter contends, however, that a cap on the Texas
SO2 Trading Program does not mitigate the errors concerning
EPA's rules governing its Supplemental Allowance Pool, banking, and
related issues. Were that the case, EPA could simply promulgate any
trading program rule it desired, using any reasoning or allocation
methodology, as long as the end result equaled some desired total
emissions goal.
---------------------------------------------------------------------------

    \179\ 84 FR at 61852.
    \180\ 84 FR at 61854.
---------------------------------------------------------------------------

    The commenter further asserts that none of the references pointing
to the CSAPR Update Final Rule to support the notion that allocations
to retired units and the availability of banking are important to
ensure market stability provide any rationale or support for allocating
emission credits to already retired EGUs. Allocating allowances to
already retired units only serves to inflate the SO2 budget,
thereby reducing the value of the allowances, which disincentivizes
SO2 reduction. Moreover, the commenter asserts that the
Texas SO2 Trading Program arbitrarily creates a windfall to
operators that have independently chosen to cease operations or
relinquish their permit rights to emit any pollution. Giving
permanently-retired sources and their operators a free pass to emit
more haze-causing pollution than they are legally allowed to emit under
the Clean Air Act cannot comply with the Regional Haze Rule's
requirement that any trading program ``achieve greater reasonable
progress'' than source-specific BART. 40 CFR 51.308(e), (e)(2); see
also 40 CFR 51.308(d)(vi). In a comment submitted following the
supplemental proposal adding an assurance level to the Texas
SO2 Trading Program, the commenter further emphasized that
the agency proposed to give the owners of those already-retired sources
an even bigger emissions ``variability'' cushion, effectively ensuring
that those companies will have no incentive or need to reduce emissions
at any other source. The commenter goes further stating that the
assurance level and variability limit virtually ensure that certain
utilities holding emission credits for already-retired sources will be
allowed to continue polluting at the same or greater levels than
before.
    Response: As an initial matter, this action does not reopen any
aspect of the CSAPR regulations. However, in order to facilitate our
response to comments on the proposed amendments to the Texas
SO2 Trading Program, we first respond to the commenter's
statements concerning the CSAPR programs as necessary to correct errors
in the commenter's statements that may also implicate the commenter's
statements concerning the Texas SO2 Trading Program.
Contrary to the commenter's statements, the CSAPR variability limits do
not ``provide headroom in'' or otherwise alter the CSAPR state budgets,
which are fixed amounts for all years from 2017 forward. Rather, a
state's CSAPR variability limit is a defined increment by which the
state's total emissions in a given year may exceed the underlying fixed
CSAPR state budget before any incremental emissions trigger
requirements to surrender more than one allowance per ton of emissions.
Also, the amounts of the CSAPR variability limits were determined based
on an analysis of historical variability in states' consumption of all
fossil fuels for electricity generation, not states' consumption of
only coal for electricity generation.
    Turning to the substance of these comments, we continue to believe
that the addition of assurance provisions to the Texas SO2
Trading Program will provide further support for our determination that
the Texas SO2 Trading Program is at least as stringent as
the CSAPR SO2 trading program as applied to Texas and for
that reason is sufficiently stringent to meet the requirements for a
BART alternative under 40 CFR 51.308(e)(2). When promulgating the Texas
SO2 Trading Program, we found that the average annual
emissions authorized by the program's design would be similar to the
emissions authorized under CSAPR and well below the 317,100 tons-per-
year benchmark established by the sensitivity analysis performed in the
2012 ``CSAPR Better-than-BART'' rulemaking. In the supplemental
proposal for this action, in response to comments raising concerns that
the program as originally promulgated in fact might not constrain
emissions in individual years as effectively as CSAPR, we reiterated
these conclusions regarding the program's average annual emissions but
also acknowledged that the program's design might not constrain
emissions in individual years as effectively as CSAPR because of the
lack of provisions comparable to CSAPR's ``assurance provisions.'' We
therefore proposed and in this action are now finalizing the addition
of assurance provisions to the Texas SO2 Trading Program in
order to further ensure that the program's design is at least as
stringent as the CSAPR SO2 program as applied to Texas, not
only on an average annual basis but also in individual years.
    The commenter suggests that even where revisions to a trading
program have been specifically designed to achieve a desired total
emissions goal--in this instance, ensuring that statewide emissions
levels in individual years do not exceed the 317,100 tons-per-year
benchmark--the ability of the revisions to in fact achieve that goal is
not the relevant criterion by which we should evaluate the
appropriateness of the revisions, and that we should instead evaluate
the revisions (and the program as a whole) based on whether or not the
revised program also addresses other concerns raised by the commenter.
We disagree with this suggestion. In noting the list of program design
features that the commenter considers problematic, we did not endorse
the full set of concerns that the commenter asserts these design
features raise. Rather, we acknowledged the specific concern as to
whether the program is or is not at least as stringent in individual
years as the CSAPR SO2 trading program, and we proposed
amendments to address that specific concern. While the commenter
asserts that the identified design features raise additional concerns
and believes that we should evaluate the program according to different
criteria, we do not agree. We have addressed the commenter's assertions
regarding the identified design features and additional evaluation
criteria in response to other comments. In general, the commenter
provides no cogent explanation why the addition of an assurance level
(which effectively functions as a ``cap'' as their own language
concedes) would not ensure emissions performance of the program on an
annual basis below that level. Nor has the commenter explained why, if
that is the case, the other objections they raise with respect to
allocations or banking of allowances are of relevance to EPA's
determination that the program achieves the necessary level of
stringency for a BART alternative under 51.308(e)(2).
    The commenter's criticism of the discussion in the supplemental
proposal concerning our general rationale for not immediately
discontinuing allocations to retired units has no relevance to the
proposed addition of assurance provisions to the Texas SO2
Trading Program or any of the other proposed amendments in the
supplemental proposal. We have addressed the commenter's assertions
regarding the permissibility of allocating allowances

to retired units in response to other comments.
    Comment: One commenter asserts that EPA's calculation of its
proposed variability limit uses out-of-date data, rather than the most
recent data as used in CSAPR. In promulgating CSAPR, EPA's original
stated reasoning for the need for a variability limit was to account
for ``weather, economic activity, the portion of electric generation
that is fossil fuel fired, and the length and number of outages at
power generation units, which vary over time.'' \181\ The commenter
asserts that in its supplemental proposal for its Texas SO2
Trading Program, EPA simply adopts the variability for Texas (7%) that
was calculated in the CSAPR rulemaking, instead of updating it to
account for more recent data and the units that are actually
participating in the Texas SO2 Trading Program. The CSAPR
heat input data from 2000-2010 are now eight years out of date. Thus,
this data set is no longer suitable for its originally intended
purpose--to account for variations in weather, economic activity, etc.,
that influence electricity generation.
---------------------------------------------------------------------------

    \181\ See 76 FR 48,208, 48,265 (Aug. 8, 2011). EPA specifically
notes that the factors that contribute to power sector variability
change with time. Also, note that EPA updated its previous
variability calculations, based on 2002-2008, in part to utilize the
more recent data available to it. EPA should have taken the same
approach in its supplemental proposal.
---------------------------------------------------------------------------

    The commenter asserts that EPA must, at a minimum, update the
technical analysis underlying its variability limits, as the agency has
done in other contexts, such as its recent update to CSAPR, for
example, where EPA relied on updated Integrated Planning Model data to
analyze the impact of the updated Transport Rule on the U.S. electric
power sector, as well as its preliminary transport modeling data for
the 2015 ozone NAAQS. In so doing, EPA recognized the many changes to
the distribution and magnitude of electric sector emissions, including
the significant expansion of renewable energy generation resources,
recent EGU retirements and control additions, changes in the cost and
efficacy of pollution control technologies, reductions in electricity
demand, electric system transmission changes, and persistently low
natural gas prices.\182\ In the supplemental proposal for its Texas
SO2 Trading Program, EPA arbitrarily fails to acknowledge--
let alone address--the numerous changes to the electric sector since
the agency adopted its CSAPR variability limits in 2011.\183\
---------------------------------------------------------------------------

    \182\ See generally Ex. 1, EPA, ``Documentation for EPA's Power
Sector Modeling Platform v6--November 2018 Reference Case,''
available at https://www.epa.gov/airmarkets/documentation-epas-power-sector-modeling-platform-v6-november-2018-reference-case.
    \183\ Motor Vehicle Mfrs. Assn. of United States, Inc. v. State
Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (``The agency must
examine the relevant data and articulate a satisfactory explanation
for its action including a `rational connection between the facts
found and the choice made.' ''); Sierra Club v. EPA, 671 F.3d 955,
967 (9th Cir. 2012) (``[I]f new information indicates to EPA that [a
proposed rule] awaiting approval is inaccurate or not current, . . .
EPA should properly evaluate the new information and may not simply
ignore it without reasoned explanation of its choice.'').
---------------------------------------------------------------------------

    The commenter states that in addition, the obsoleteness of the heat
input data aside, given the EGU retirements that have occurred since
2010, that data set is much different than what would be calculated
based on the units that would actually participate in EPA's Texas
SO2 Trading Program. The commenter purported to illustrate
this via a table comparing historical heat inputs from 2000-2010 for
units under original CSAPR, units in the Texas trading program, and
units in the Texas program minus retired units. Comparing the columns
showing these heat inputs, commenter asserts that the magnitudes of the
data sets indicate that despite being of the same years, they are
composed of different units. In fact, the heat input data set composed
of only the unretired units that would actually participate in the
Texas SO2 trading program is approximately one third the
size of the data set that EPA is basing its variability analysis on. In
its continued strained attempt to justify its inadequate Texas
SO2 trading program by comparison to CSAPR, commenter claims
EPA ignores its earlier decision to base its variability calculation on
only the units that actually participate in the trading program.
    Response: In the supplemental proposal, we proposed to adopt a
variability limit of 7% for the Texas SO2 Trading Program,
where the proposed limit was calculated based on the annual heat input
values for Texas in the same overall data set used to calculate the
analogous variability limit of 18% for the CSAPR SO2
program. In most respects, the Texas SO2 Trading Program has
been designed to replicate relevant aspects of the CSAPR SO2
program. We do not dispute that the Texas electricity sector has
evolved in the years since the CSAPR rulemaking and we agree with the
general principle that the most current data of sufficient quality and
representativeness should be used when conducting new rulemaking
activities. However, we do not believe that acceptance of the general
principle in favor of using more recent data when available necessarily
requires that the principle be applied to every detail of a rulemaking,
such as this one, that is being conducted with an overall purpose of
closely replicating the structure of a previous rulemaking.
    Nevertheless, in order to assess the potential impacts of using
more recent data instead of the CSAPR rulemaking data set specifically
for purposes of establishing the amount of the variability limit for
the Texas SO2 Trading Program, we have calculated what the
variability limit would be if it were calculated using the more recent
data set suggested by the commenter. In the following comment, the
commenter states that this calculation would result in a variability
limit of 2%, but as discussed in greater detail in our response to that
comment, the commenter did not actually use the more recent data set
and furthermore made a material error in the calculation procedure.
When the calculation procedure is applied to the more recent data set
and the procedural error is corrected, the result would be a higher
variability limit than we proposed--specifically, 12% instead of 7%.
Because neither this commenter nor any other commenter advocates using
a variability limit higher than 7%, and some other commenters
specifically support use of the variability limit and resulting
assurance level calculated based on values for Texas in the data set
used in the CSAPR rulemaking, we do not find it necessary to use an
updated data set in this instance.
    Comment: We received a comment that disagreed with the
computational methodology EPA used to calculate the variability limit
of 7%, arguing that the limit should instead be 2%. The commenter
purported to recalculate what a Texas SO2 Trading Program
variability limit would be if it were based on EPA's original
methodology used in CSAPR. The commenter purported to follow the CSAPR
methodology and use up-to-date data and include only those units that
are expected to be covered by the program.
    Response: In this proceeding, we did not seek comment on or reopen
any aspect of the CSAPR regulations. However, in order to facilitate
our response to comments on the proposed amendments to the Texas
SO2 Trading Program, we are responding to the commenter's
statements concerning the CSAPR programs as necessary to correct errors
in the commenter's statements that may also implicate the commenter's
statements concerning the Texas SO2 Trading Program.

    We disagree with the commenter's assertions that we made an error
in the statistical procedure for calculating the variability limits
used in the CSAPR trading programs and the variability limit proposed
for the Texas SO2 Trading Program. In fact, the commenter
made a mistake in the calculation of the variability limits. We have
added to the docket for this action a spreadsheet that is a modified
version of the spreadsheet the commenter submitted to the docket as
Exhibit 3 to the comments on the supplemental proposal.\184\ See the
spreadsheet and the Response to Comments document found in the docket
associated with this final action for a detailed explanation of the
calculation and discussion of how correction of one of the values in
the spreadsheet submitted by the commenter yields values that confirm
the correctness of our calculations.
---------------------------------------------------------------------------

    \184\ See ``EPA modified version of commenters Ex_3_-
_Recalculate_TX_SO2_Trading _Variability.xlsx,''
available in the docket for this action.
---------------------------------------------------------------------------

    The results of the calculations in this section confirm a CSAPR
SO2 variability limit of 18%. The CSAPR SO2 5%
variability limit asserted by the commenter results only from using the
incorrect value of 11 for the ``size'' variable in the CONFIDENCE
function.
    Comment: We received a comment stating that EPA's proposed
assurance level is incorrect because the assurance level EPA borrows
from CSAPR is simply the sum of the SO2 budget and the
variability limit. Because the EPA incorrectly incorporated the Texas
variability limit from CSAPR into its Texas SO2 trading
program, and because EPA's trading budget of 238,393 tons itself is
based on out-of-date and inappropriate data, consequently, EPA's
calculation of its variability limit, which is simply a percentage of
this budget, is flawed. The commenter argues that had EPA re-applied
the original CSAPR allocation methodology using updated information,
and removed retired units, it would have discovered that the individual
allocations in many instances would have changed significantly and the
overall budget would have been reduced significantly. The commenter
asserts that the trading budget would have been reduced from 238,393
tons to 176,332 tons. This represents a decrease of 62,061 tons or an
approximately 26% change. Adding a 2% variability to the revised
trading budget of 176,332 tons would result in an assurance limit of
179,859 tons.
    Furthermore, the commenter asserts that even at this lower
emissions level, the Texas SO2 Trading Program will not
serve to place any regulatory pressure on Texas SO2 sources
to reduce their emissions because the 2018 SO2 emissions of
the participating non-retired units--which should be the only units
participating in the program--total 157,119 tons. These emissions are
already below the reduced assurance limit of 179,859 tons commenter
calculated above.
    Finally, the commenter states that because the Texas SO2
Trading Program does not provide for a declining cap over time, in
comparison to actual source-by-source BART, even if corrected to remove
retired units it merely preserves the status quo. As such, it violates
the primary objective of the national goal of the visibility program,
which is ``the prevention of any future, and the remedying of any
existing, impairment of visibility in mandatory class I Federal areas
which impairment results from manmade air pollution.''
    Response: We disagree with this comment. The commenter correctly
notes that the proposed assurance level for the Texas SO2
Trading Program is derived from the proposed 7% variability limit and
the existing budget for the Texas SO2 Trading Program. Based
on the commenter's beliefs that the variability limit should be 2% and
that the existing budget is unlawfully high, the commenter asserts that
the proposed assurance level is consequently also too high. We disagree
both that the variability limit should be 2% and that the existing
budget is unlawfully high. Accordingly, we also disagree with the
commenter's resulting assertion that the proposed assurance level is
too high. We have addressed the commenter's assertions regarding the
proposed variability limit in response to other comments. As indicated
in those responses, we continue to believe that 7% is an appropriate
value to establish as the variability limit for the Texas
SO2 Trading Program. Likewise, we have also addressed the
commenter's assertions regarding the lawfulness of the existing budget
for the Texas SO2 Trading Program in response to other
comments, and the commenter offers no new criticism of the existing
budget that was not already raised in those previous comments and
addressed in our responses to those comments.

L. Venue

    Comment: We received a comment asserting that if EPA retains the
intrastate trading program, the agency must publish a finding that the
Texas SO2 Trading Program ``is based on a determination of
nationwide scope or effect.'' 42 U.S.C. 7607(b)(1). The commenter
asserted that such a finding is necessary because the Texas
SO2 Trading Program is plainly based on such a determination
and should be reviewed in the United States Court of Appeals for the
District of Columbia. The commenter claimed that this is for two
reasons. First, in comparing the Texas SO2 Trading Program
to the Better-than-BART rule to satisfy the requirements of 40 CFR
51.308(e), EPA reinterpreted an established and nationally applicable
law. Second, the commenter claimed that EPA's unlawful interpretation
of 40 CFR 51.308(e) amounts to a revision of a nationally applicable
regulation. The commenter noted that in this comment, the commenter
does not challenge CSAPR itself or EPA's CSAPR Better-than-BART
determination, but is instead asserting that the Texas SO2
Trading Program is based on those rules, which are nationally
applicable and contain determinations of nationwide scope and effect.
The commenter asserted that even if EPA does not publish a finding that
the Texas SO2 Trading Program is based on a determination of
nationwide scope or effect (and does not withdraw the FIP promulgating
the Texas SO2 Trading Program), subsequent legal challenges
will still be properly venued in the D.C. Circuit pursuant to 42 U.S.C.
7607(b)(1).
    Response: To the extent commenter is asserting that this action is
``nationally applicable'' for purposes of section 307(b), that claim is
clearly incorrect. As the D.C. Circuit has recently explained, ``[t]he
court need look only to the face of the agency action, not its
practical effects, to determine whether an action is nationally
applicable.'' \185\ On its face, this action is locally applicable
because it applies in only a single state, Texas. This action has
immediate, legal effect only for certain sources within Texas.
Furthermore, EPA is not adopting a new interpretation of its
regulations at 40 CFR 51.308(e)(2); nor is it correct to characterize
EPA's application of those regulations as a revision necessitating
national rulemaking.
---------------------------------------------------------------------------

    \185\ Sierra Club v. EPA, 926 F.3d 844, 849 (D.C. Cir. 2019)
(citing Dalton Trucking, 808 F.3d 875, 881 (D.C. Cir. 2015) and Am.
Road & Transp. Builders Ass'n v. EPA, 705 F.3d 453, 456 (D.C. Cir.
2013)).
---------------------------------------------------------------------------

    EPA also disagrees that this action must be challenged in the D.C.
Circuit under the ``nationwide scope or effect'' portion of the venue
provision of CAA section 307(b). In general under section 307(b), an
EPA action ``which is locally or regionally applicable'' may be filed
``only in the United States Court of

Appeals'' covering that area.\186\ The only exception to this mandate
is where the Administrator expressly finds that the locally or
regionally applicable action is based on a determination of nationwide
scope or effect and publishes such a finding. The requirement that the
Administrator find and publish that an otherwise locally or regionally
applicable action is based on a determination of nationwide scope or
effect is an express statutory requirement for application of this
venue exception; this exception is not being invoked by EPA in this
action. EPA has made no finding in this action and is not publishing
any finding that this action is based on a determination of nationwide
scope or effect. The absence of either such a finding or publication of
such a finding makes this venue exception in CAA section 307(b)
inapplicable. Absent an express statement--and publication--that such a
finding has been made, thus invoking the venue exception, there can be
no application of that exception.\187\ CAA section 307 expressly
provides the Agency full discretion to make its own determination of
whether to invoke the exception in the Congressionally-dictated venue
provision.\188\
---------------------------------------------------------------------------

    \186\ See 42 U.S.C. 7607(b)(1) (emphasis added).
    \187\ See, e.g., Lion Oil v. EPA, 792 F.3d 978, 984 n.1 (8th
Cir. 2015) (even where EPA, unlike here, made the necessary finding,
the court found no need to decide application of the venue exception
absent publication of that finding); Texas v. EPA, 829 F.3d 405, 419
(5th Cir. 2016) (``This finding is an independent, post hoc,
conclusion by the agency about the nature of the determinations; the
finding is not, itself, the determination.''). See also Dalton
Trucking v. EPA, 808 F.3d 875 (D.C. Cir. 2015).
    \188\ See, e.g., Texas v. EPA, 829 F.3d at 419-20 (the venue
exception ``gives the Administrator the discretion to move venue to
the D.C. Circuit by publishing a finding declaring the
Administrator's belief that the action is based on a determination
of nationwide scope or effect.'') (emphasis added).
---------------------------------------------------------------------------

    Even assuming that a court could review the lack of such a finding,
and lack of publication of such a finding, under the arbitrary and
capricious standard,\189\ the EPA's decision not to do so is not
unreasonable in this case. As an initial matter, this action does not
apply to any sources other than those covered by the program in the
State of Texas. By the same token, the applicability of the action does
not span multiple federal judicial circuits. Further, EPA is not
proposing or adopting a new or different interpretation of its
regulations at 40 CFR 51.308(e)(2), nor is it correct to characterize
EPA's application of those regulations as a revision necessitating
national rulemaking. The commenter's characterization of EPA's analysis
as conducting a novel comparison of the Texas program to CSAPR as a
BART alternative is incorrect. In the final action, EPA is making no
such interpretation that 51.308(e)(2) authorizes a comparison between
two BART alternatives. Rather, in this final action, EPA has determined
it is acceptable to continue to rely on the CSAPR-Better-than-BART
analysis (which included Texas) under the unique, state-specific
circumstances presented here: That the intrastate trading program in
Texas achieves the same or better emissions outcomes as the CSAPR
program would have. The CSAPR Better-than-BART analysis on which EPA is
relying uses presumptive BART limits--in compliance with
51.308(e)(2)(i)(C)--to demonstrate greater reasonable progress.
---------------------------------------------------------------------------

    \189\ Cf. Sierra Club v. EPA, 926 F.3d 844, 850 (D.C. Cir. 2019)
(declining to resolve whether failure to make a finding is
reviewable but concluding the absence of such a finding was not
arbitrary and capricious under the facts of the case).
---------------------------------------------------------------------------

    Further, the application of the nationally applicable 2012 and 2017
CSAPR findings in Texas is a ``locally or regionally applicable''
action; that application does not in itself make the lack of EPA
invoking the exception unreasonable. While the 2012 finding was
appropriately reviewed (and upheld) in the D.C. Circuit, and the 2017
finding is currently being reviewed in the D.C. Circuit, see NPCA v.
EPA, 17-1253 (D.C. Cir.), the application of those findings in Texas is
merely one aspect of this ``locally or regionally applicable'' action.
In any future action that may raise similar circumstances as Texas (and
EPA is aware of no such situation at this time), EPA's determination
whether to promulgate an intrastate trading program as a BART
alternative would be based on a record and analysis specific to the
sources in that state at that time. EPA has announced no national
policy or interpretation that the decisions in this action are, or
would necessarily be, applicable in any future action. Thus, EPA has
not reinterpreted or revised its Regional Haze Rule regulations in this
action, and it is inaccurate to characterize the mere application of
regulations in a case-specific circumstance as a revision of those
regulations. Under such circumstances, EPA's lack of a finding or
publication of such a finding here is hardly unreasonable.
    Finally, we note that EPA did not make a finding in the October 17,
2017 final action originally promulgating the Texas SO2
Trading Program that such action was based on a determination of
nationwide scope or effect. This action merely affirms the 2017 action
with certain amendments. Petitioners seeking judicial review of that
action correctly filed for review in the Fifth Circuit, see NPCA v.
EPA, No. 17-60828 (5th Cir.), and that case is being held in abeyance
pending the completion of this action. No petitions for review of the
original FIP action were filed in the D.C. Circuit, nor would it have
been appropriate to do so.

M. Other

    Comment: One commenter, while appreciative of the revisions made to
the program by the EPA, expressed concern that without decreasing
emissions assurance limitations or source-specific SO2
limits, improved visibility in protected areas such as the Wichita
Mountains National Wildlife Refuge and Guadalupe Mountains National
Park will not come to fruition as a result of more concentrated
emissions, even if they come from fewer sources.
    The commenter also expressed concern for potential impacts to local
air quality. While SO2 emissions from individual sources may
technically meet state-wide air quality targets, there remains a
potential to negatively impact local air quality, damaging both
visibility and human health. The commenter proposed two potential
options that the EPA might consider. The first is to examine historic
emissions by source and define new limits on a per-facility basis
informed by historic emissions that met CSAPR for SO2. This
would ensure that even if some facilities closed, those that remained
operational would not be able to increase their SO2
emissions. The second suggested option would be to implement emission
limits that decline annually. Under a declining emissions-limit
scenario, if plants did close, operational facilities would potentially
still be able to emit more, but to a lesser extent than if the cap
stayed constant. If all regulated facilities stayed open, each polluter
would have to find additional methods to decrease SO2
emissions, further improving visibility and human health.
    The commenter also expressed concern in consideration of units not
participating in the program and their contribution to the total
assurance provisions. The Texas SO2 Trading Program will
allot 35,000 tons per year to non-participating sources, effectively
increasing the assurance provision to 290,081 tons per year. While
SO2 emissions in Texas have steadily declined, the Texas
SO2 Trading Program would nearly allow emissions to return
to 2014 levels. The commenter asserts that it is nonsensical to place a
limit on SO2 emissions that does not pressure polluters to
reduce emissions. Previously discussed comments argue

that unlike source-specific BART control requirements, the Texas
SO2 Trading Program allows for emission to increase compared
to recent emission levels. The state of Texas has clearly made great
strides in decreasing sulfur emissions from coal-fired powerplants and
the EPA has a responsibility to Texans and residents of neighboring
states to maintain that progress, not reverse it.
    Response: We appreciate the commenter's concerns and suggestions.
With regards to localized impacts, as previously discussed in response
to other comments, the analysis EPA is relying on does not show
visibility declines compared to the baseline in any Class I area under
the BART alternative. Under the Regional Haze Rule, states are directed
to conduct BART determinations for ``BART-eligible'' sources that may
be anticipated to cause or contribute to any visibility impairment in a
Class I area. States are required to identify the level of control
representing BART after considering the five statutory factors set out
in section 169A(g)(2) for each source subject-to-BART.\190\ However,
the Regional Haze Rule also gives states the flexibility to adopt an
emissions trading program or alternative program in place of requiring
source-specific BART controls, as long as the alternative provides
greater reasonable progress towards improving visibility than BART. As
discussed in section I.A. of this final action, 40 CFR 51.308(e)(2)
specifies how a state must conduct the demonstration to show that an
alternative program will achieve greater reasonable progress than the
installation and operation of BART. As discussed in section III.A.2, we
are taking final action to affirm our determination that the Texas
SO2 Trading Program, as amended in this final action, meets
the requirements of 40 CFR 51.308(e)(2) as a BART alternative for
SO2 to satisfy Texas' Regional Haze obligations. Comments on
EPA's decision to authorize alternative measures, including emissions
trading programs, in the original 1999 Regional Haze Rule are beyond
the scope of this action.
---------------------------------------------------------------------------

    \190\ The State must take into consideration the five statutory
factors: (1) The costs of compliance, (2) the energy and non-air
quality environmental impacts of compliance, (3) any existing
control technology in use at the source, (4) the remaining useful
life of the source, and (5) the degree of visibility improvement
which may reasonably be anticipated to result.
---------------------------------------------------------------------------

    The comment that we have ``allotted'' 35,000 tons to non-
participating units is incorrect. The Texas SO2 Trading
Program only pertains to the particular set of EGUs specified in Table
1 of this final rule. The estimate of emissions from non-participating
units is used as a conservative assumption to allow for a comparison of
SO2 emissions from EGUs in Texas under the Texas program
with emissions under CSAPR.

V. Final Action

A. Regional Haze

    We are taking final action to affirm our October 2017 FIP that
established the Texas SO2 intrastate trading program
addressing emissions of SO2 from certain EGUs in Texas as a
BART alternative, with certain amendments to the trading program. These
amendments consist of (1) the addition of assurance provisions; (2)
revisions to the Supplemental Allowance Pool allocation provisions,
including amendments to the allocation methodology such that allowance
allocations are in proportion to each owner's total emissions in excess
of the owner's total base allowance allocations, elimination of the
additional flexibility to transfer allowances originally offered under
the trading program for Coleto Creek, and reduction in the number of
allowances that can be allocated from the Supplemental Allowance Pool
in any year to 16,688 tons plus any allowances added to the pool in
that year from retired units; (3) termination of the opt-in provisions;
and (4) revision of the allowance recordation provisions. We are also
correcting a 2-ton error we made in the allowance allocation for El
Paso Electric's Newman Plant due to a unit-identification error,
thereby increasing the trading program budget from 238,393 tons to
238,395 tons. We are taking final action to affirm our determination
that the Texas SO2 intrastate trading program, as amended in
this final rulemaking, satisfies the Regional Haze Rule requirements
for BART alternatives at 40 CFR 51.308(e)(2). We are also taking final
action to affirm our October 2017 approval of Texas' SIP determination
that no Texas sources are subject to BART for PM.

B. Interstate Visibility Transport

    We are taking final action to affirm our finding that Texas'
participation in CSAPR to satisfy NOX BART and our
SO2 intrastate trading program, as amended in this final
rulemaking, fully address Texas' interstate visibility transport
obligations for the following six NAAQS: (1) 1997 8-hour ozone; (2)
1997 PM2.5 (annual and 24 hour); (3) 2006 PM2.5
(24-hour); (4) 2008 8-hour ozone; (5) 2010 1-hour NO2; and
(6) 2010 1-hour SO2. Texas' SO2 emission
reductions under the Texas SO2 intrastate trading program,
as amended in today's final rulemaking, are consistent with the level
of emission reductions relied upon by other states during Regional Haze
consultation, and the intrastate trading program is therefore adequate
to ensure that emissions from Texas do not interfere with measures to
protect visibility in nearby states in accordance with CAA section
110(a)(2)(D)(i)(II).

VI. Statutory and Executive Order Reviews

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

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

    This action is not a significant regulatory action and was
therefore not submitted to the Office of Management and Budget (OMB)
for review.

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

    This action is not an Executive Order 13771 regulatory action
because this action is not significant under Executive Order 12866.

C. Paperwork Reduction Act

    This action does not impose any new information collection burden
under the PRA. The Office of Management and Budget (OMB) has previously
approved the information collection activities contained in the
existing Texas SO2 Trading Program regulations as part of
the most recent information collection request (ICR) renewal for the
CSAPR trading programs and has assigned OMB control number 2060-0667.
The revisions approved in this action do not alter the information
collection activities contained in the existing regulations.

D. Regulatory Flexibility Act

    I certify that this action will not have a significant impact on a
substantial number of small entities. In making this determination, the
impact of concern is any significant adverse economic impact on small
entities. An agency may certify that a rule will not have a significant
economic impact on a substantial number of small entities if the rule
relieves regulatory burden, has no net burden or otherwise has a
positive economic effect on the small entities subject to the rule.
This rule does not impose any requirements or

create impacts on small entities. This FIP action under Section 110 of
the CAA will not create any new requirement with which small entities
must comply. Accordingly, it affords no opportunity for the EPA to
fashion for small entities less burdensome compliance or reporting
requirements or timetables or exemptions from all or part of the rule.
We have therefore concluded that, this action will have no net
regulatory burden for all directly regulated small entities.

E. Unfunded Mandates Reform Act (UMRA)

    This action does not contain an unfunded mandate of $100 million or
more as described in UMRA, 2 U.S.C. 1531-1538, and does not
significantly or uniquely affect small governments.

F. Executive Order 13132: Federalism

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

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

    This rule does not have tribal implications, as specified in
Executive Order 13175. It will not have substantial direct effects on
tribal governments. Thus, Executive Order 13175 does not apply to this
rule.

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

    Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks \191\ applies to any rule that: (1) Is
determined to be economically significant as defined under Executive
Order 12866; and (2) concerns an environmental health or safety risk
that we have reason to believe may have a disproportionate effect on
children. EPA interprets E.O. 13045 as applying only to those
regulatory actions that concern health or safety risks, such that the
analysis required under Section 5-501 of the E.O. has the potential to
influence the regulation. This action is not subject to Executive Order
13045 because it is not economically significant as defined in
Executive Order 12866, and because the EPA does not believe the
environmental health or safety risks addressed by this action present a
disproportionate risk to children. This action is not subject to E.O.
13045 because it implements specific standards established by Congress
in statutes. However, to the extent this rule will limit emissions of
SO2, the rule will have a beneficial effect on children's
health by reducing air pollution.
---------------------------------------------------------------------------

    \191\ 62 FR 19885 (Apr. 23, 1997).
---------------------------------------------------------------------------

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

    This action is not subject to Executive Order 13211 (66 FR 28355
(May 22, 2001)), because it is not a significant regulatory action
under Executive Order 12866.

J. National Technology Transfer and Advancement Act (NTTAA)

    This rulemaking does not involve technical standards.

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

    The EPA believes that this action does not have disproportionately
high and adverse human health or environmental effects on minority
populations, low-income populations and/or indigenous peoples, as
specified in Executive Order 12898 (59 FR 7629, February 16, 1994). We
have determined that this rule will not have disproportionately high
and adverse human health or environmental effects on minority or low-
income populations because it increases the level of environmental
protection for all affected populations without having any
disproportionately high and adverse human health or environmental
effects on any population, including any minority or low-income
population. The rule limits emissions of SO2 from certain
facilities in Texas.

L. Congressional Review Act (CRA)

    This rule is exempt from the CRA because it is a rule of particular
applicability.

List of Subjects in 40 CFR Part 97

    Environmental protection, Administrative practice and procedure,
Air pollution control, Incorporation by reference, Nitrogen dioxide,
Reporting and recordkeeping requirements, Sulfur oxides.

Andrew Wheeler,
Administrator.

    For the reasons stated in the preamble, part 97 of chapter I of
title 40 of the Code of Federal Regulations is amended as follows:

PART 97--FEDERAL NOX BUDGET TRADING PROGRAM, CAIR NOX AND SO2
TRADING PROGRAMS, CSAPR NOX AND SO2 TRADING PROGRAMS, AND TEXAS SO2
TRADING PROGRAM

0
1. The authority citation for part 97 is revised to read as follows:

    Authority:  42 U.S.C. 7401, 7403, 7410, 7426, 7491, 7601, and
7651, et seq.

Subpart FFFFF--TEXAS SO2 TRADING PROGRAM

0
2. Amend Sec.  97.902 by:
0
a. In the definitions of ``Acid Rain Program'', ``Allowance Management
System'', and ``Allowance Management System account'', capitalizing the
first three words;
0
b. Adding in alphabetical order a definition of ``Assurance account'';
0
c. In the definition of ``Authorized account representative'',
capitalizing the word ``trading'' the first time it appears;
0
d. Adding in alphabetical order definitions of ``Common designated
representative'', ``Common designated representative's assurance
level'', and ``Common designated representative's share''; and
0
e. Revising the definitions of ``General account'' and ``Texas
SO2 Trading Program allowance deduction''.
    The additions and revisions read as follows:

Sec.  97.902   Definitions.

* * * * *
    Assurance account means an Allowance Management System account,
established by the Administrator under Sec.  97.925(b)(3) for certain
owners and operators of a group of one or more Texas SO2
Trading Program sources and units, in which are held Texas
SO2 Trading Program allowances available for use for a
control period in a given year in complying with the Texas
SO2 Trading Program assurance provisions in accordance with
Sec. Sec.  97.906 and 97.925.
* * * * *
    Common designated representative means, with regard to a control
period in a given year, a designated representative where, as of April
1 immediately after the allowance transfer deadline for such control
period, the same natural person is authorized under Sec. Sec.
97.913(a) and 97.915(a) as the designated representative for a group of
one or more Texas SO2 Trading Program sources and units.
    Common designated representative's assurance level means, with
regard to a specific common designated representative and control
period in a given year for which the State assurance

level is exceeded as described in Sec.  97.906(c)(2)(iii):
    (1) The amount (rounded to the nearest allowance) equal to the sum
of the total amount of Texas SO2 Trading Program allowances
allocated for such control period under Sec.  97.911, or deemed to have
been allocated under paragraph (2) of this definition, to the group of
one or more Texas SO2 Trading Program units having the
common designated representative for such control period multiplied by
the sum for such control period of the Texas SO2 Trading
Program budget under Sec.  97.910(a)(1) and the variability limit under
Sec.  97.910(b) and divided by the sum of the total amount of Texas
SO2 Trading Program allowances allocated for such control
period under Sec.  97.911, or deemed to have been allocated under
paragraph (2) of this definition, to all Texas SO2 Trading
Program units;
    (2) Provided that, in the case of a Texas SO2 Trading
Program unit that operates during, but has no amount of Texas
SO2 Trading Program allowances allocated under Sec.  97.911
for, such control period, the unit shall be treated, solely for
purposes of this definition, as being allocated the amount of Texas
SO2 Trading Program allowances shown for the unit in Sec.
97.911(a)(1).
    Common designated representative's share means, with regard to a
specific common designated representative for a control period in a
given year and the total amount of SO2 emissions from all
Texas SO2 Trading Program units during such control period,
the total tonnage of SO2 emissions during such control
period from the group of one or more Texas SO2 Trading
Program units having the common designated representative for such
control period.
* * * * *
    General account means an Allowance Management System account,
established under this subpart, that is not a compliance account or an
assurance account.
* * * * *
    Texas SO2 Trading Program allowance deduction or deduct Texas SO2
Trading Program allowances means the permanent withdrawal of Texas
SO2 Trading Program allowances by the Administrator from a
compliance account (e. g., in order to account for compliance with the
Texas SO2 Trading Program emissions limitation) or from an
assurance account (e. g., in order to account for compliance with the
assurance provisions under Sec. Sec.  97.906 and 97.925).
* * * * *

Sec.  97.904   [Amended]

0
3. Amend Sec.  97.904 by removing and reserving paragraph (b).

0
4. Amend Sec.  97.906 by:
0
a. In paragraph (b)(2), adding the words ``and assurance provisions''
after the words ``emissions limitation'';
0
b. Redesignating paragraphs (c)(2) through (6) as paragraphs (c)(3)
through (7) and adding a new paragraph (c)(2);
0
c. Revising newly redesignated paragraph (c)(3); and
0
d. In newly redesignated paragraph (c)(4)(ii), removing the text
``paragraph (c)(1)(ii)(A)'' and adding in its place the text
``paragraphs (c)(1)(ii)(A) and (c)(2)(i) through (iii)''.
    The additions and revision read as follows:

Sec.  97.906   General provisions.

* * * * *
    (c) * * *
    (2) Texas SO2 Trading Program assurance provisions. (i) If total
SO2 emissions during a control period in a given year from
all Texas SO2 Trading Program units at Texas SO2
Trading Program sources exceed the State assurance level, then the
owners and operators of such sources and units in each group of one or
more sources and units having a common designated representative for
such control period, where the common designated representative's share
of such SO2 emissions during such control period exceeds the
common designated representative's assurance level for such control
period, shall hold (in the assurance account established for the owners
and operators of such group) Texas SO2 Trading Program
allowances available for deduction for such control period under Sec.
97.925(a) in an amount equal to two times the product (rounded to the
nearest whole number), as determined by the Administrator in accordance
with Sec.  97.925(b), of multiplying--
    (A) The quotient of the amount by which the common designated
representative's share of such SO2 emissions exceeds the
common designated representative's assurance level divided by the sum
of the amounts, determined for all common designated representatives
for such sources and units for such control period, by which each
common designated representative's share of such SO2
emissions exceeds the respective common designated representative's
assurance level; and
    (B) The amount by which total SO2 emissions from all
Texas SO2 Trading Program units at Texas SO2
Trading Program sources for such control period exceed the State
assurance level.
    (ii) The owners and operators shall hold the Texas SO2
Trading Program allowances required under paragraph (c)(2)(i) of this
section, as of midnight of November 1 (if it is a business day), or
midnight of the first business day thereafter (if November 1 is not a
business day), immediately after the year of such control period.
    (iii) Total SO2 emissions from all Texas SO2
Trading Program units at Texas SO2 Trading Program sources
during a control period in a given year exceed the State assurance
level if such total SO2 emissions exceed the sum, for such
control period, of the Texas SO2 Trading Program budget
under Sec.  97.910(a)(1) and the variability limit under Sec.
97.910(b).
    (iv) It shall not be a violation of this subpart or of the Clean
Air Act if total SO2 emissions from all Texas SO2
Trading Program units at Texas SO2 Trading Program sources
during a control period exceed the State assurance level or if a common
designated representative's share of total SO2 emissions
from the Texas SO2 Trading Program units at Texas
SO2 Trading Program sources during a control period exceeds
the common designated representative's assurance level.
    (v) To the extent the owners and operators fail to hold Texas
SO2 Trading Program allowances for a control period in a
given year in accordance with paragraphs (c)(2)(i) through (iii) of
this section,
    (A) The owners and operators shall pay any fine, penalty, or
assessment or comply with any other remedy imposed under the Clean Air
Act; and
    (B) Each Texas SO2 Trading Program allowance that the
owners and operators fail to hold for such control period in accordance
with paragraphs (c)(2)(i) through (iii) of this section and each day of
such control period shall constitute a separate violation of this
subpart and the Clean Air Act.
    (3) Compliance periods. (i) A Texas SO2 Trading Program
unit shall be subject to the requirements under paragraph (c)(1) of
this section for the control period starting on January 1, 2019 and for
each control period thereafter.
    (ii) A Texas SO2 Trading Program unit shall be subject
to the requirements under paragraph (c)(2) of this section for the
control period starting on January 1, 2021 and for each control period
thereafter.
* * * * *

0
5. Amend Sec.  97.910 by:
0
a. Revising the section heading;

0
b. In paragraph (a)(1), removing ``238,393'' and adding in its place
``238,395''; and
0
c. Adding paragraphs (b) and (c).
    The revision and additions read as follows:

Sec.  97.910   Texas SO2 Trading Program budget, Supplemental Allowance
Pool budget, and variability limit.

* * * * *
    (b) The variability limit for the Texas SO2 Trading
Program budget for the control periods in 2021 and thereafter is 16,688
tons.
    (c) The Texas SO2 Trading Program budget in paragraph
(a)(1) of this section does not include any tons in the Supplemental
Allowance Pool budget in paragraph (a)(2) of this section or the
variability limit in paragraph (b) of this section.

0
6. Amend Sec.  97.911 by:
0
a. Revising paragraph (a)(1);
0
b. In paragraph (a)(2), removing the text ``allocated under the Texas
Supplemental Allowance Pool under 40 CFR 97.912.'' and adding in its
place the text ``transferred to the Supplemental Allowance Pool for
potential allocation in accordance with Sec.  97.912.'';
0
c. Removing and reserving paragraph (b);
0
d. In paragraph (c)(1), removing the text ``paragraph (a) or (b)'' and
adding in its place the text ``paragraph (a)''; and
0
e. Revising paragraph (c)(5).
    The revisions read as follows:

Sec.  97.911   Texas SO2 Trading Program allowance allocations.

    (a)(1) Except as provided in paragraph (a)(2) of this section,
Texas SO2 Trading Program allowances from the Texas
SO2 Trading Program budget will be allocated, for the
control periods in 2019 and each year thereafter, as provided in Table
1 to this paragraph (a)(1):

                       Table 1 to Paragraph (a)(1)--Texas SO2 Trading Program Allocations
----------------------------------------------------------------------------------------------------------------
                                                                   Texas SO2
                                                                    trading
        Texas SO2 trading program units            ORIS code        program        Affiliated ownership group
                                                                  allocation
                                                                    (tons)
----------------------------------------------------------------------------------------------------------------
Big Brown Unit 1..............................            3497           8,473  Vistra Energy..
Big Brown Unit 2..............................            3497           8,559  Vistra Energy.
Coleto Creek Unit 1...........................            6178           9,057  Vistra Energy.
Fayette (Sam Seymour) Unit 1..................            6179           7,979  Lower Colorado River Authority/
                                                                                City of Austin.
Fayette (Sam Seymour) Unit 2..................            6179           8,019  Lower Colorado River Authority/
                                                                                City of Austin.
Graham Unit 2.................................            3490             226  Vistra Energy.
HW Pirkey Unit 1..............................            7902           8,882  American Electric Power.
Harrington Unit 061B..........................            6193           5,361  Xcel Energy.
Harrington Unit 062B..........................            6193           5,255  Xcel Energy.
Harrington Unit 063B..........................            6193           5,055  Xcel Energy.
JT Deely Unit 1...............................            6181           6,170  City of San Antonio.
JT Deely Unit 2...............................            6181           6,082  City of San Antonio.
Limestone Unit 1..............................             298          12,081  NRG Energy.
Limestone Unit 2..............................             298          12,293  NRG Energy.
Martin Lake Unit 1............................            6146          12,024  Vistra Energy.
Martin Lake Unit 2............................            6146          11,580  Vistra Energy.
Martin Lake Unit 3............................            6146          12,236  Vistra Energy.
Monticello Unit 1.............................            6147           8,598  Vistra Energy.
Monticello Unit 2.............................            6147           8,795  Vistra Energy.
Monticello Unit 3.............................            6147          12,216  Vistra Energy.
Newman Unit 2.................................            3456               1  El Paso Electric.
Newman Unit 3.................................            3456               1  El Paso Electric.
Newman Unit **4...............................            3456               2  El Paso Electric.
Newman Unit **5...............................            3456               2  El Paso Electric.
Sandow Unit 4.................................            6648           8,370  Vistra Energy.
Sommers Unit 1................................            3611              55  City of San Antonio.
Sommers Unit 2................................            3611               7  City of San Antonio.
Stryker Unit ST2..............................            3504             145  Vistra Energy.
Tolk Unit 171B................................            6194           6,900  Xcel Energy.
Tolk Unit 172B................................            6194           7,062  Xcel Energy.
WA Parish Unit WAP4...........................            3470               3  NRG Energy.
WA Parish Unit WAP5...........................            3470           9,580  NRG Energy.
WA Parish Unit WAP6...........................            3470           8,900  NRG Energy.
WA Parish Unit WAP7...........................            3470           7,653  NRG Energy.
Welsh Unit 1..................................            6139           6,496  American Electric Power.
Welsh Unit 2..................................            6139           7,050  American Electric Power.
Welsh Unit 3..................................            6139           7,208  American Electric Power.
Wilkes Unit 1.................................            3478              14  American Electric Power.
Wilkes Unit 2.................................            3478               2  American Electric Power.
Wilkes Unit 3.................................            3478               3  American Electric Power.
----------------------------------------------------------------------------------------------------------------

* * * * *
    (c) * * *
    (5) With regard to the Texas SO2 Trading Program
allowances that are not recorded, or that are deducted as an incorrect
allocation, in accordance with paragraphs (c)(2) and (3) of this
section, the Administrator will transfer such Texas SO2
Trading Program allowances to the Supplemental Allowance Pool for
potential allocation in accordance with Sec.  97.912.

0
7. Amend Sec.  97.912 by:
0
a. In paragraph (a) introductory text, removing the text ``each control
period in 2019 and thereafter,'' and adding in its place the text ``the
control periods in 2019 and 2020,'';

0
b. In paragraph (a)(1), removing the text ``each subsequent February
15,'' and adding in its place the text ``February 15, 2021,'', and
removing the second period and adding in its place the text ``and
recorded under Sec.  97.921.'';
0
c. In paragraph (a)(2), removing the period and adding in its place the
text ``and recorded under Sec.  97.921.'';
0
d. In paragraph (a)(3)(ii)(A), removing the text ``paragraph (b)'' and
adding in its place the text ``paragraph (d)'';
0
e. In paragraph (a)(3)(ii)(B), removing the text ``paragraph (b)''
wherever it appears and adding in its place the text ``paragraph (d)'',
and adding a new sentence between the existing first and second
sentences;
0
f. In paragraph (a)(3)(iii), removing the text ``paragraph (b)'' and
adding in its place the text ``paragraph (d)'';
0
g. Redesignating paragraphs (a)(4) and (b) as paragraphs (c) and (d)
and adding a new paragraph (b); and
0
h. Revising newly redesignated paragraph (d).
    The addition and revision read as follows:

Sec.  97.912   Texas SO2 Trading Program Supplemental Allowance Pool.

    (a) * * *
    (3) * * *
    (ii) * * *
    (B) * * * The Administrator will adjust the sources' allocations up
or down by one allowance, starting with the largest allocation and
continuing in descending order, as necessary to cause the sum of the
sources' allocations to equal the total number of allowances in the
Supplemental Allowance Pool available for allocation under paragraph
(d) of this section that remain after any allocation under paragraph
(a)(3)(i) of this section. * * *
* * * * *
    (b) For each control period in 2021 and thereafter, the
Administrator will allocate Texas SO2 Trading Program
allowances from the Texas SO2 Trading Program Supplemental
Allowance Pool as follows:
    (1) For each control period, the Administrator will assign each
Texas SO2 Trading Program unit to an affiliated ownership
group reflecting the unit's ownership as of December 31 of the control
period. The affiliated ownership group assignments for each control
period will be as shown in Sec.  97.911(a)(1) except that the
Administrator will revise the assignments, based on the information
required to be submitted in accordance with Sec.  97.915(c) and any
other information available to the Administrator, as necessary to
reflect any ownership transfer resulting in a 50% or greater ownership
share of a unit being held by a new owner that the Administrator
determines is not affiliated with the previous holder of a 50% or
greater ownership share of the unit.
    (2) No later than February 15, 2022 and each subsequent February
15, the Administrator will review all the quarterly SO2
emissions reports provided under Sec.  97.934(d) for each Texas
SO2 Trading Program unit for the previous control period.
The Administrator will identify each affiliated ownership group of
Texas SO2 Trading Program units as of December 31 of such
control period for which the total amount of emissions reported for the
units in the group for that control period exceeds the total amount of
allowances allocated to the units in the group for that control period
under Sec.  97.911 and recorded under Sec.  97.921.
    (3) For each affiliated ownership group of Texas SO2
Trading Program units identified under paragraph (b)(2) of this
section, the Administrator will calculate the amount by which the total
amount of reported emissions for that control period exceeds the total
amount of allowances allocated for that control period under Sec.
97.911 and recorded under Sec.  97.921.
    (4)(i) The Administrator will allocate and record allowances from
the Supplemental Allowance Pool as follows:
    (A) If the total for all such affiliated ownership groups of the
amounts calculated under paragraph (b)(3) of this section is less than
or equal to the total number of allowances in the Supplemental
Allowance Pool available for allocation under paragraph (d) of this
section, then each such group's allocation of allowances from the
Supplemental Allowance Pool shall equal to the amount calculated for
the group under paragraph (b)(3) of this section.
    (B) If the total for all such affiliated ownership groups of the
amounts calculated under paragraph (b)(3) of this section is greater
than the total number of allowances in the Supplemental Allowance Pool
available for allocation under paragraph (d) of this section, then the
Administrator will calculate each such group's allocation of allowances
from the Supplemental Allowance Pool by dividing the amount calculated
under paragraph (b)(3) of this section for the group by the sum of the
amounts calculated under paragraph (b)(3) of this section for all such
groups, then multiplying by the number of allowances in the
Supplemental Allowance Pool available for allocation under paragraph
(d) of this section and rounding to the nearest allowance. The
Administrator will adjust the groups' allocations up or down by one
allowance, starting with the largest allocation and continuing in
descending order, as necessary to cause the sum of the groups'
allocations to equal the total number of allowances in the Supplemental
Allowance Pool available for allocation under paragraph (d) of this
section.
    (C) When an affiliated ownership group receives an allocation of
allowances under paragraph (b)(4)(i)(A) or (B) of this section, each
source in the group whose emissions during the control period for which
allowances are being allocated exceed the amount of allowances
allocated to the source under Sec.  97.911 and recorded under Sec.
97.921 will receive a share of the group's allocation. The
Administrator will compute each such source's share by dividing the
amount of the source's emissions during the control period exceeding
the source's allocation under Sec.  97.911 by the sum for all such
sources of the amounts of the sources' emissions during the control
period exceeding the sources' allocations under Sec.  97.911, then
multiplying by the group's allocation under paragraph (b)(4)(i)(A) or
(B) of this section and rounding to the nearest allowance. The
Administrator will adjust the sources' allocations up or down by one
allowance, starting with the largest allocation and continuing in
descending order, as necessary to cause the sum of the sources'
allocations to equal the group's allocation. The Administrator will
then record the calculated allocations of allowances in the applicable
sources' compliance accounts.
    (ii) Any unallocated allowances remaining in the Supplemental
Allowance Pool after the allocations determined under paragraph
(b)(4)(i) of this section will be maintained in the Supplemental
Allowance Pool. These allowances will be available for allocation by
the Administrator in subsequent control periods to the extent
consistent with paragraph (d) of this section.
* * * * *
    (d) The total amount of allowances in the Supplemental Allowance
Pool available for allocation for a control period is equal to the sum
of the Supplemental Allowance Pool budget under Sec.  97.910(a)(2), any
allowances from retired units pursuant to Sec.  97.911(a)(2) and from
corrections pursuant to Sec.  97.911(c)(5), and any allowances
maintained in the Supplemental Allowance Pool pursuant to paragraph
(a)(3)(iii) or (b)(4)(ii) of this

section, provided that if the number of allowances in the Supplemental
Allowance Pool exceeds the applicable limit for the control period
under paragraph (d)(1) or (d)(2) of this section, then the
Administrator may only allocate allowances up to such applicable limit.
    (1) For the control periods in 2019 and 2020, the total amount of
allowances allocated from the Supplemental Allowance Pool for a control
period may not exceed by more than 44,711 tons the sum of the
Supplemental Allowance Pool budget under Sec.  97.910(a)(2) and any
portion of the Texas SO2 Trading Program budget under Sec.
97.910(a)(1) not otherwise allocated for that control period under
Sec.  97.911(a)(1).
    (2) For each control period in 2021 and thereafter, the total
amount of allowances allocated from the Supplemental Allowance Pool for
a control period may not exceed the sum of the variability limit under
Sec.  97.910(b) and any portion of the Texas SO2 Trading
Program budget under Sec.  97.910(a)(1) not otherwise allocated for
that control period under Sec.  97.911(a)(1).

0
8. Amend Sec.  97.913 by revising paragraph (c) to read as follows:

Sec.  97.913   Authorization of designated representative and alternate
designated representative.

* * * * *
    (c) Except in this section, Sec.  97.902, and Sec. Sec.  97.914
through 97.918, whenever the term ``designated representative'' (as
distinguished from the term ``common designated representative'') is
used in this subpart, the term shall be construed to include the
designated representative or any alternate designated representative.

Sec.  97.915  [Amended]

0
9. Amend Sec.  97.915 paragraph (d) introductory text and paragraph
(d)(1) by removing the text ``(see Sec.  97.904(b))''.

0
10. Amend Sec.  97.920 by:
0
a. Revising the section heading;
0
b. Redesignating paragraphs (b) through (d) as paragraphs (c) through
(e) and adding a new paragraph (b);
0
c. In newly redesignated paragraph (c)(2)(i) introductory text,
removing the text ``paragraph (b)(1)'' and adding in its place the text
``paragraph (c)(1)'';
0
d. In newly redesignated paragraph (c)(2)(ii), removing the text
``paragraph (b)(5)'' and adding in its place the text ``paragraph
(c)(5)'';
0
e. In newly redesignated paragraphs (c)(3)(i) and (ii), removing the
text ``paragraph (b)(1)'' and adding in its place the text ``paragraph
(c)(1)'';
0
f. In newly redesignated paragraph (c)(4)(i), removing the text
``paragraph (b)(1)'' wherever it appears and adding in its place the
text ``paragraph (c)(1)'';
0
g. In newly redesignated paragraph (c)(4)(ii), removing the text
``paragraph (b)(4)(i)'' and adding in its place the text ``paragraph
(c)(4)(i)'';
0
h. In newly redesignated paragraph (c)(5)(iii) introductory text and
paragraph (c)(5)(iii)(C), removing the text ``paragraph (b)(5)(i)'' and
adding in its place the text ``paragraph (c)(5)(i)'';
0
i. In newly redesignated paragraph (c)(5)(iii)(D), removing the text
``97.920(b)(5)(iv)'' and adding in its place the text
``97.920(c)(5)(iv)'';
0
j. In newly redesignated paragraph (c)(5)(iii)(E), removing the text
``97.920(b)(5)(iv),'' and adding in its place the text
``97.920(c)(5)(iv),'', and removing the text ``97.920(b)(5)'' and
adding in its place the text ``97.920(c)(5)'';
0
k. In newly redesignated paragraph (c)(5)(iv), removing the text
``paragraph (b)(5)(iii)'' and adding in its place the text ``paragraph
(c)(5)(iii)'';
0
l. In newly redesignated paragraph (c)(5)(v), removing the text
``paragraph (b)(5)(iii)(D)'' and adding in its place the text
``paragraph (c)(5)(iii)(D)'', and removing the text ``paragraph
(b)(5)(iv)'' and adding in its place the text ``paragraph (c)(5)(iv)'';
0