continuous emissions monitoring system (CEMS) data are available, WESTAR
recommended that the menu include, with no implications of a hierarchy:

Use short-term maximum emissions for the entire plant over a two-year
period;

Determine maximum short-term emissions from each source at the facility;

Determine short-term emission rates and sort them, then determine
representative rates, such as an upper percentile, as the single
short-term emission rate for modeling;

Use CEMS data to determine actual emissions as defined by rule and
explained by EPA in the preamble to the 1980 PSD rule revisions; or

Use hour-by-hour CEMS data in the model.

In situations where CEMS data are not available, WESTAR recommended that
the menu for calculating short-term actual emission rates include, with
no implications of a hierarchy:

Average 2 years of actual annual emissions representing normal
operations surrounding the baseline date and date of analysis for
current emissions, and divide by annual operating hours;

Calculate emissions from production data for the 2 years prior to the
baseline date or date of analysis for current emissions (emissions
calculated using valid emissions factors and methods);

Use 2 years of emissions data, which may be before or after the baseline
dates, which have a similar facility configuration that would be
representative of baseline emissions; or

Use of allowable emission rates, including use of regulatory limits,
where appropriate.

EPA requests comment on whether it should expand the proposed options
for short-term emissions rate calculation to include elements from
WESTAR’s menu.

	4. 	Use of Allowable Emissions Rates

	EPA has always allowed a reviewing authority or source to conduct a
more conservative screening analysis using allowable emissions rates
which are typically higher than actual emissions rates.  We propose to
preserve that option under the new definition, but we are modifying the
language from the prior definition slightly to make clear that we do not
intend to mandate the use of allowable emissions, only to permit it at
the discretion of the source or reviewing authority.

	5. 	Emissions from a New or Modified Source

	When an increment consumption analysis is performed in the context of a
pending permit application to demonstrate that a new or modified source
will not cause or contribute to an exceedance of the increment, the
analysis must include the emissions from the new or modified source when
it begins operations after the permitted construction is complete.  In
the past, EPA has required such emissions to be based on the potential
to emit of the new or modified source.  However, in reforms to the NSR
program completed in 2002, EPA allowed modified sources to use projected
actual emissions in calculating whether the change resulted in a net
significant increase in emissions.   For the same reasons discussed in
that rulemaking [cite the final 2002 rule], we propose to adopt revised
language for purposes of the increment consumption assessment that
requires the use of projected actual emissions for a modified source.
We propose to continue requiring the increment assessment to be based on
the potential to emit of a new source that has not begun normal
operations as of the date of the assessment.

C.	What meteorological models and data should be used in increment
consumption modeling?

In addition to information on emissions from sources in the relevant
area, one also needs meteorological data to evaluate consumption of the
PSD increments.  Meteorological data are a necessary input to the air
quality models that are used to identify the change in concentration
from the baseline date that is compared to the increments to demonstrate
compliance.  Adequate and appropriate meteorological data are a critical
input for dispersion models, as these data are used to characterize the
state of the atmosphere in terms of the transport and diffusion of
airborne pollutants within the modeling domain.  Appendix W contains a
list of meteorological data types and meteorological processors that are
appropriate for various applications of preferred dispersion models.

Recent EPA experience with PSD increment modeling exercises has raised
questions regarding the adequacy of the current Agency guidance to the
States and regulated community concerning the appropriateness of certain
types of meteorological data and the amount of data that should be
obtained for certain dispersion model applications, including PSD
increment analyses.  We discuss these issues below in light of existing
guidance, and seek comment on the need for modification and/or
development of additional guidance.

1.	Types of Meteorological Data and Processing

Traditionally, dispersion model applications have utilized
meteorological inputs derived from the direct processing of National
Weather Service (NWS) observation data or meteorological data collected
as part of a site-specific measurement program.  However, tools are also
available to project meteorological conditions in order to fill gaps in
site-specific observational data.  Recent EPA experience suggests there
may be a need for the Agency to clarify the circumstances when it is
permissible and appropriate to use meteorological data derived from
prognostic meteorological models in dispersion model simulations such as
a PSD increment consumption analysis.

Prognostic meteorological models use fundamental equations of momentum,
thermodynamics, and moisture to determine the evolution of specific
meteorological variables from a given initial state.  These models can
characterize meteorological conditions at times and locations where
observational data do not exist.  Photochemical grid-based air quality
models, which require consistent input parameters distributed over an
even grid in time and space, routinely utilize data output from
prognostic meteorological models.  Examples of prognostic meteorological
models are:

MM5 - Penn State University/National Center for Atmospheric Research

WRF - Weather Research and Forecasting Model, NOAA/NCAR

RUC - Rapid Update Cycle, NOAA Rapid Refresh Development Group

In addition, diagnostic processors such as CALMET can format
meteorological model output data for input into dispersion models.  In
addition, these diagnostic processors often can incorporate
meteorological observation data into the process, resulting in a field
of meteorological data that effectively blends the ground-truth of
observations with the dynamics of the meteorological model.  This data
assimilation process frequently takes place within the prognostic
meteorological models themselves.  Run-time parameters may be set in the
diagnostic processors to vary the influence observations may have on the
resulting data set.

Appendix W identifies criteria for judging the adequacy and
appropriateness of such meteorological input data for dispersion
modeling applications, including the spatial and temporal
representativeness of the data for the specific application and the
ability of the individual meteorological parameters selected to properly
characterize the transport and diffusion conditions based on the
formulations of a specific dispersion model.  Meteorological data may be
considered adequate and appropriate for a particular dispersion model or
application, but that determination does not necessarily imply the
adequacy and appropriateness of the data for other dispersion models or
other applications of the same model.  The proper judgment of adequacy
and appropriateness of meteorological data requires expert knowledge of
each of the main components - the meteorological observation data; the
meteorological processor; and the dispersion model formulations and data
requirements.

Appendix W lists specific factors to consider when determining whether
or not a set of meteorological data is representative for a particular
dispersion model application. These include the proximity of the
meteorological monitoring site to the area of interest, the complexity
of the terrain in the area, the exposure of the meteorological
monitoring site, and the period of data collected.  Additional factors
may be important depending on the requirements of specific models.  For
example, surface characteristics of the meteorological observation
location, depending on land use and land cover characteristics, as well
as terrain type and elevation, are required for input to AERMET, the
meteorological processor for the AERMOD dispersion model.  These surface
characteristics have a significant impact on the boundary layer
parameters that are required for input into the AERMOD model, and
therefore have an impact on the resulting air quality results.  The
determination of representativeness for AERMOD therefore requires
consideration of the potential impact of differences in surface
characteristics between the meteorological monitoring site and the
surface characteristics that generally describe the area upon which the
air quality model simulation is focused.

For long range transport modeling assessments or assessments involving
complex winds that require non-steady-state dispersion modeling,
appendix W allows, and in fact encourages, the use of prognostic
mesoscale meteorological models to provide input data into dispersion
model simulations.  See 40 CFR part 51, appendix W, paragraph 8.3(d).
However, proper use of output from these prognostic meteorological
models in dispersion model applications requires expert judgment, and
acceptance of such data is contingent on the concurrence of the
appropriate reviewing authorities.  Appendix W further indicates that
mesoscale meteorological fields should be used in conjunction with
available NWS or comparable meteorological observations within and near
the modeling domain.

In this action, we are proposing to provide additional guidelines for
determining the appropriateness of prognostic meteorological model
output data for use in dispersion models.  We propose that a
determination of appropriateness would involve a process equal in rigor
to that already used to review prognostic meteorological model output
data for use in photochemical grid modeling applications at the regional
scale.  We believe that our existing guidance for photochemical grid
models provides a useful basis for the process by which the State may
allow use of certain data sets created by prognostic meteorological
models as input into dispersion model applications provided these data
sets are determined, by using this process, to be appropriate.
Currently, acceptable quality of meteorological inputs derived from
prognostic meteorological models would be demonstrated by statistical
comparison of the prognostic model output to observations of winds at
surface-level and aloft.

When making a determination of the representativeness of meteorological
inputs derived from prognostic models, it is important to consider the
influences of observations in both the meteorological model and in any
subsequent processing of the prognostic model outputs when comparing the
output to observations as part of the evaluation.  However, it is
important to emphasize that a statistical comparison of the
meteorological observation data to the output of the diagnostic
processor, or even of the prognostic meteorological models, can only be
one part of any determination of appropriateness.  Additional technical
factors that may need to be considered in the determination of
appropriateness include:

Influence of boundary and initial conditions;

Physics options governing the meteorological calculations;

Data assimilation parameters; and

Selection of geographic domains and time periods.

Guidance for consideration of these factors can be found in “Guidance
on the Use of Models and Other Analyses for Demonstrating Attainment of
Air Quality Goals for Ozone, PM2.5, and Regional Haze,” draft version
3.2, September 2006 (referred to hereafter as “the Draft Guidance”).
 However, this guidance concerns regional-scale photochemical grid model
applications.  We request comment on how these and other factors may be
considered in a determination of appropriateness of meteorological data
derived from prognostic meteorological models for use in dispersion
modeling applications.  As explained in the Draft Guidance,
regional-scale photochemical grid model applications require the above
factors be considered with regard to prognostic meteorological model
output, and additionally require consideration of other factors specific
to photochemical grid modeling.

	While meteorological model input that has been accepted for use in
photochemical grid modeling may generally be acceptable for application
in dispersion modeling inasmuch as the specifics of the meteorological
model simulation are concerned, there are additional factors specific to
dispersion modeling that must be considered.  For example, the
particular portion of the meteorological model output used in dispersion
modeling must be considered in terms of its appropriateness for that
particular dispersion model.  Keeping in mind that the grid model is
designed to produce a consistent set of parameters covering a large
geographic area, we must consider the effects of extracting a few
geographic points, from as few as only one grid cell in the entire model
domain, and applying that very small subset of data from a greater
dataset that was designed to be used in total.

For example, meteorological model simulations are influenced by input
data assigned to the boundary grid cells in the domain (boundary
conditions) as well as to all grid cells within the domain at the
initial time step (initial conditions).  There are appropriate
techniques that may be applied to model simulations to substantially
reduce the influence of initial and boundary conditions for
photochemical grid modeling.

Boundary conditions, however, are input into the meteorological model at
each time step, and therefore the effect of the boundary conditions is
evident throughout the meteorological model simulation.  To reduce the
effect of these assigned boundary conditions, we propose the area of
interest be selected from an area substantially within the model
simulation domain, for example, at least six grid cells from the
boundary.

We also propose to include in any review, a thorough description of the
techniques used to extract data from a larger grid, even if the
meteorological data have been approved for use in a photochemical grid
model application, if the extraction is performed using a tool or
technique not listed in appendix W as part of a preferred modeling
system.

2.	Years of Meteorological Data

 In addition to clarifying the process and guidance for determining the
circumstances under which it may be appropriate to input data from
prognostic meteorological models into dispersion modeling, we believe it
is also necessary to clarify guidance on the number of years of
prognostic meteorological model output data that are necessary for a
representative dispersion model simulation.  With respect to the number
of years of meteorological observation data  that should be used for
dispersion modeling, appendix W currently states the following:

Five years of representative NWS meteorological observation data are
required – the most recent, readily available 5-year period is
preferred.

At least 1 year of site-specific meteorological data is required – as
many as 5 years are preferred.

See 40 CFR part 51, appendix W, paragraph <IP_ADDRESS>(a).  However, with
respect prognostic meteorological data, appendix W states that for
long-range transport modeling and for other assessments involving
non-steady-state dispersion modeling to account for complex flows, less
than 5, but at least 3, years of data from prognostic meteorological
models may be used, and that the years need not be consecutive.  See
paragraph <IP_ADDRESS>(d).

We believe that our current guidance provides adequate discretion to the
State to determine which and how many years (but no less than 3 years)
should be used with regard to meteorological model output appropriate
for the dispersion model application.  Consistent with appendix W, this
approach is integrated with the process described in the preceding
section for determining appropriateness of prognostic meteorological
model output.  When a State is developing a set of data years for
dispersion modeling, we propose to allow the State to consider any data
years that it has determined to be appropriate using the process
described above even if those data years were not produced by the same
exact meteorological model configuration and simulation.  However, we
also propose that the State must further determine that a particular set
of data years can be modeled to produce an appropriate depiction of the
air quality issue at hand.

3. 	Evaluating the Appropriateness of Data Years from Prognostic
Meteorological Models for Modeling Worst-Case Impacts

For applications in which the modeling approach is designed to model
worst-case impacts, we propose that the State should determine whether
or not a set of years is appropriate based upon
meteorological/climatological representativeness, and additionally
determine whether or not that set of years is appropriate to simulate
the worst-case conditions required of the application.  Keeping in mind
worst-case conditions might not be discernable until simulated through a
dispersion model, the term “worst-case” does not describe a set of
worst-case meteorology, but rather a set of meteorology that when
modeled, produces a worst-case depiction of air quality.  This
relationship may not be apparent on simple inspection of only the
meteorological data set.

That a particular data set sufficiently represents the meteorological
observations for a given area for a given time period, based upon
statistical analyses, may not be proof enough to determine that the
particular data set is most appropriate for a dispersion application,
especially when conducting worst-case applications.  Additionally, a set
of prognostic meteorological model output might be appropriate for
dispersion modeling generally, but the portion of the data extracted for
the specific dispersion model application should still be examined for
appropriateness.  While we do not explicitly propose a three-step
process for determining appropriateness, these three individual
examinations – appropriateness of the prognostic meteorological model
output in general, appropriateness (meteorological representativeness)
of the extracted data set, and appropriateness of the data set for the
dispersion model application – are each a necessary part of the
overall determination of appropriateness, especially in replacing data
years of processed meteorological observations.  Of course, once a
particular data set/subset is determined appropriate, we do not
anticipate re-examining that data set for use in other dispersion
modeling provided the modeling applications and modeling domains are
similar.

We also request  comment on continuing the current path, based upon
appendix W’s current guidance that previous years of meteorological
data should be added to any meteorology years modeled (if emissions
limitations were based upon modeling those previous years).  See 40 CFR
part 51, appendix W, paragraph <IP_ADDRESS>(c).  We will also accept comments
on the use of data sets of processed observations, prognostic
meteorological model output, or combinations of both.

D.	What are my documentation and data and software availability
requirements?

	Appendix W currently provides recommendations (see paragraph 3.1.1)
regarding documentation and software availability for preferred modeling
techniques that are listed in appendix W.  (The preferred models are
found in appendix A to appendix W, and are sometimes referred to as
“Appendix A models.”)  The purpose of these recommendations includes
fostering consistency in the application of dispersion models,
minimizing the burden on applicants related to acquiring and setting up
modeling applications, and providing transparency regarding model
formulations, model performance, and model input requirements.  These
appendix W recommendations regarding documentation and software
availability for preferred modeling techniques include that the “model
and its code cannot be proprietary.”  See paragraph 3.1.1(b)(vi) of
appendix W.

	Application of the non-proprietary requirement to data developed for
use by a preferred model, or to other software used to process data for
a preferred model, is not explicitly addressed in appendix W.  However,
such a strict requirement to be non-proprietary is currently not applied
to alternative models (paragraph 3.2) that may be selected for use on a
case-by-case basis, subject to the approval of the appropriate reviewing
authority.  Rather, the focus of recommendations related to the use of
alternative models is on a demonstration and documentation of model
performance that is equivalent or superior to the preferred model and,
for cases where there is no preferred model, a scientific peer review
and documentation and demonstration of the theoretical basis for the
applicability of the alternative model.  In addition, proprietary
software interfaces to simplify the setup and analysis of Appendix A
models have been developed by several commercial vendors, and have been
in common usage for more than a decade.  Such commercial software
interfaces have not been subjected to a requirement to make the
proprietary code available to the public or the reviewing authority.
However, demonstrations of equivalency may be, and have been, required
of such proprietary interfaces, in keeping with paragraph 3.2.2(c) of
appendix W.

	With technical advances and the increased use of more sophisticated
methodologies for developing the required meteorological inputs for
preferred modeling techniques, and in particular the use of prognostic
meteorological model outputs in the development of spatial and
temporally varying meteorology for long-range transport modeling
applications with the preferred CALPUFF model, it is appropriate to
address the adequacy and appropriateness of existing guidance for these
emerging modeling technologies.  Given the critical impact that the
processed meteorological data have on such modeling applications, basic
requirements for technical documentation and performance demonstration
are certainly necessary.  However, EPA believes that the existing
guidance provided for alternative modeling techniques adequately
addresses these concerns.  The existing guidance implies a certain
discretion and latitude for the reviewing authority in defining the
specific data and documentation requirements necessary to make its
determination of the acceptability of an alternative modeling technique
for a given application.  However, such requirements should be
technically appropriate and avoid imposing an unnecessary burden on the
applicant.  In the case of meteorological data inputs for dispersion
models, many of the relevant issues and requirements for such data are
also discussed above in section IV.C of this preamble.

	In the special case of proprietary data that may be used in the
development of model inputs, EPA believes that it is currently within
the discretion of the State to require some independent review of the
proprietary data by an oversight agency, if such a review is deemed
critical to the overall assessment of the appropriateness of data for a
particular modeling application.  Another option within the discretion
of the State would be for the State itself to conduct the review,
provided that proprietary information and trade secrets are protected
under a system that is equivalent to EPA’s rules for requesting
non-disclosure of Confidential Business Information (CBI) submitted to
the Agency.  See 40 CFR part 2.  Provided that any appropriate and
necessary reviews can be conducted by an independent body or the State
reviewing authority with protection against disclosure of CBI, EPA does
not believe it is necessary to require such proprietary data to be made
available to the general public or to wholly preclude reliance on the
data in regulatory modeling applications.

In the case of software, the focus of the determination of acceptability
by the reviewing authority should be on the adequacy of the technical
documentation and performance demonstrations that are required to
support the use of such software.  More specifically in the case of
proprietary software, the reproducibility of the data or model
simulation may be an important component of the documentation to ensure
confidence in the modeling results, and the applicant should facilitate
such a demonstration when required.  Additional documentation regarding
the quality assurance procedures used in the development of the
proprietary software may also be relevant to supporting the integrity
and accuracy of the results.

	The EPA believes that the current text of appendix W adequately defines
the documentation and software availability requirements related to both
preferred and alternative modeling techniques.  The EPA requests comment
on whether additional guidance is needed to clarify these requirements
as they apply to the use of proprietary software and/or data to develop
input for an Appendix A modeling application for PSD increment
consumption.

V.	Implementation Issues

A.	Is there a need for States to make revisions to their SIPs?

	As described in this notice, we believe that the changes we are
proposing are clarifications of our existing guidance and rules.  With
these changes, we are codifying our policy on certain aspects of PSD
increment analyses to provide certainty to States and regulated sources
on how to calculate increases in concentrations for purposes of
determining compliance with the PSD increments.  Once we finalize these
proposed changes, we intend to encourage States to incorporate them for
the sake of consistency and clarity, and to make their SIPs consistent
with the proposed rule amendments.  This would be a relatively easy task
given that SIP changes resulting from other upcoming NSR rulemakings
(e.g., rules for electric generating units (EGUs); corn milling;
potential to emit (PTE); and aggregation, debottlenecking, and project
netting) will likely be required in roughly the same time period.
However, we believe that, since these proposed provisions would simply
clarify and codify our increment modeling policy, SIP changes would not
be required in order to implement them.  We are specifically seeking
comment on the need for SIP revisions or any viable alternatives for
implementing the changes for these proposed increment analysis
provisions.

B.	When would these policies be put into effect?

	Since we are proposing that SIP revisions are not necessary to
implement these approaches, these proposed provisions would be
automatically effective 60 days from promulgation.

VI.	  SEQ CHAPTER \h \r 1 Statutory and Executive Order Reviews

A.	Executive Order 12866 - Regulatory Planning and Review

Under section 3(f)(1) of Executive Order (EO) 12866 (58 FR 51735,
October 4, 1993), this action is an “economically significant
regulatory action” because it is likely to raise novel legal or policy
issues arising out of legal mandates, the President's priorities, or the
principles set forth in the Executive Order.  Accordingly, EPA submitted
this action to the Office of Management and Budget (OMB) for review
under Executive Order 12866 and any changes made in response to OMB
recommendations have been documented in the docket for this action.

B.	Paperwork Reduction Act

This action does not impose any new information collection burden.  We
are not promulgating any new paperwork requirements (e.g., monitoring,
reporting, recordkeeping) as part of this proposed action.  The OMB has
previously approved the information collection requirements contained in
the existing regulations (40 CFR parts 51 and 52) under the provisions
of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., and has assigned
OMB control number 2060-0003, EPA ICR number 1230.17.  A copy of the OMB
approved Information Collection Request (ICR) may be obtained from Susan
Auby, Collection Strategies Division; U.S. Environmental Protection
Agency (2822T); 1200 Pennsylvania Avenue, NW, Washington, DC 20460 or by
calling<PHONE_NUMBER>.

Burden means the total time, effort, or financial resources expended by
persons to generate, maintain, retain, or disclose or provide
information to or for a Federal agency. This includes the time needed to
review instructions; develop, acquire, install, and utilize technology
and systems for the purposes of collecting, validating, and verifying
information, processing and maintaining information, and disclosing and
providing information; adjust the existing ways to comply with any
previously applicable instructions and requirements; train personnel to
be able to respond to a collection of information; search data sources;
complete and review the collection of information; and transmit or
otherwise disclose the information.

An Agency may not conduct or sponsor, and a person is not required to
respond to, a collection of information unless it displays a currently
valid OMB control number. The OMB control numbers for EPA's regulations
in 40 CFR are listed in 40 CFR part 9.

C.	Regulatory Flexibility Analysis

The RFA generally requires an agency to prepare a regulatory flexibility
analysis of any rule subject to notice and comment rulemaking
requirements under the Administrative Procedure Act or any other statue
unless the Agency certifies that the rule will not have a significant
economic impact on a substantial number of small entities. Small
entities include small businesses, small organizations, and small
governmental jurisdictions.

For purposes of assessing the impacts of this action on small entities,
a small entity is defined as: (1) a small business that is a small
industrial entity as defined in the U.S. Small Business Administration
(SBA) size standards (see 13 CFR 121.201); (2) a small governmental
jurisdiction that is a government of a city, county, town, school
district, or special district with a population of less than 50,000; or
(3) a small organization that is any not-for-profit enterprise that is
independently owned and operated and is not dominant in its field.

After considering the economic impacts of this action on small entities,
I certify that this action will not have a significant economic impact
on a substantial number of small entities.  This action will not impose
any requirements on small entities.

D.	Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law
104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector.  Under section 202 of the UMRA, EPA
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final rules with "Federal mandates" that may
result in expenditures to State, local, and tribal governments, in the
aggregate, or to the private sector, of $100 million or more in any 1
year.  Before promulgating an EPA rule for which a written statement is
needed, section 205 of the UMRA generally requires EPA to identify and
consider a reasonable number of regulatory alternatives and adopt the
least costly, most cost-effective or least burdensome alternative that
achieves the objectives of the rule.  The provisions of section 205 do
not apply when they are inconsistent with applicable law.  Moreover,
section 205 allows EPA to adopt an alternative other than the least
costly, most cost-effective or least burdensome alternative if the
Administrator publishes with the final rule an explanation as to why
that alternative was not adopted.  Before EPA establishes any regulatory
requirements that may significantly or uniquely affect small
governments, including tribal governments, it must have developed under
section 203 of the UMRA a small government agency plan.

The plan must provide for notifying potentially-affected small
governments, enabling officials of affected small governments to have
meaningful and timely input in the development of EPA regulatory
proposals with significant Federal intergovernmental mandates, and
informing, educating, and advising small governments on compliance with
the regulatory requirements.  This proposed action contains no Federal
mandates (under the regulatory provisions of Title II of the UMRA) for
State, local, or tribal governments or the private sector.

	The EPA has determined that this action does not contain a Federal
mandate that may result in expenditures of $100 million or more for
State, local, and tribal governments, in the aggregate, or the private
sector in any one year because in this rulemaking we propose to refine
several aspects of the method that may be used to calculate an increase
in concentration for increment purposes.  These refinements are intended
to clarify how States and regulated sources may calculate increases in
concentrations for the purposes of determining compliance with the PSD
increments and do not impose any additional requirements for such
calculations.  Thus, this action is not subject to the requirements of
sections 202 and 205 of the UMRA.

E.	Executive Order 13132 - Federalism

Executive Order 13132, entitled "Federalism" (64 FR 43255, August 10,
1999), requires EPA to develop an accountable process to ensure
"meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications."
"Policies that have federalism implications" is defined in the Executive
Order to include regulations that 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."

Under section 6(b) of Executive Order 13132, EPA may not issue a
regulation that has federalism implications, that imposes substantial
direct compliance costs, and that is not required by statute, unless the
Federal government provides the funds necessary to pay the direct
compliance costs incurred by State and local governments, or EPA
consults with State and local officials early in the process of
developing the proposed regulation.  Under section 6(c) of Executive
Order 13132, EPA may not issue a regulation that had federalism
implications and that pre-empts State law, unless the Agency consults
with State and local officials early in the process of developing the
proposed regulation.

	EPA has concluded that this final rule will 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, as specified in Executive Order 13132.
This rule merely clarifies how States and regulated sources may
calculate increases in concentrations for the purposes of determining
compliance with the PSD increments.  It does not impose any new
requirements in those sources.

In the spirit of Executive Order 13132, and consistent with EPA policy
to promote communications between EPA and State and local governments,
we are specifically soliciting comment on this proposed rule from State
and local officials.

As required by section 8(a) of Executive Order 13132, we will include a
certification from our Federalism Official stating that we had met the
Executive Order’s requirements in a meaningful and timely manner, when
we send a draft of the final rule to OMB for review pursuant to
Executive Order 12866.  A copy of this certification will be included in
the public version of the official record for this action.

F.	Executive Order 13175 - Consultation and Coordination with Indian
Tribal Governments

Executive Order 13175, entitled “Consultation and Coordination with
Indian Tribal Governments” (65 FR 13175, November 9, 2000), requires
EPA to develop an accountable process to ensure “meaningful and timely
input by tribal officials in the development of regulatory policies that
have tribal implications.”  This action will affect how permitting
authorities would determine increment consumption on the Tribal lands
that have been redesignated to Class I or are in the process of being
redesignated to Class I status.  For that reason, we are planning to
consult between the period of proposal and promulgation with the six
reservations that have been already redesignated from Class II to Class
I or are in the process of being redesignated as such.  In addition, EPA
is specifically soliciting comment on this proposed rule from tribal
officials.

G.	Executive Order 13045 - Protection of Children from Environmental
Health and Safety Risks

Executive Order 13045, entitled "Protection of Children from
Environmental Health Risks and Safety Risks" (62 FR 19885, April 23,
1997), 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 EPA has reason to believe may
have a disproportionate effect on children.  If the regulatory action
meets both criteria, the Agency must evaluate the environmental health
or safety effects of the planned rule on children, and explain why the
planned regulation is preferable to other potentially effective and
reasonably feasible alternatives considered by the Agency.

The EPA interprets Executive Order 13045 as applying only to those
regulatory actions that are based on health or safety risks, such that
the analysis required under section 5-501 of the Order has the potential
to influence the regulation.  This proposed action is not subject to the
Executive Order because it is not economically significant as defined in
Executive Order 12866, and because the Agency does not have reason to
believe the environmental health or safety risks addressed by this
action present a disproportionate risk to children.  Clarification of
how States and regulated sources may calculate increases in
concentrations for the purposes of determining compliance with the PSD
increments are expected to have a positive rather than a negative impact
on children’s health and the environment, since more accurate and less
burdensome calculations are expected.

H.	Executive Order 13211 - Actions That Significantly Affect Energy
Supply, Distribution, or Use

This action is not a  “significant energy action” as defined in
Executive Order 13211, “Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use” (66 FR
28355, May 22, 2001) because it is not an economically significant
action under Executive Order 12866.

I.	Executive Order 12898 - Federal Actions to Address Environmental
Justice in Minority Populations and Low-income Populations

Executive Order 12898 requires that each Federal agency make achieving
environmental justice part of its mission by identifying and addressing,
as appropriate, disproportionate high and adverse human health or
environmental effects of its programs, policies, and activities on
minorities and low-income populations.

	The EPA believes that the clarification of how States and regulated
sources may calculate increases in concentrations for the purposes of
determining compliance with the PSD increments should not raise any
environmental justice issues since it these refinements will allow for
more accurate and less burdensome calculations.  Consequently, this
action should result in health benefits to all.  Therefore, we believe
that this regulation would not have a disproportionate adverse effect on
the health and safety of minority and low income populations.

J.	National Technology Transfer and Advancement Act

Section 12(d) of the National Technology Transfer and Advancement Act of
1995 (NTTAA), Public Law 104-113, 12(d) (15 U.S.C. 272 note) directs EPA
to use voluntary consensus standards in its regulatory activities unless
to do so would be inconsistent with applicable law or otherwise
impractical.

Voluntary consensus standards are technical standards (for example,
materials specifications, test methods, sampling procedures, and
business practices) that are developed or adopted by voluntary consensus
standards bodies.  The NTTAA directs EPA to provide Congress, through
OMB, explanations when the Agency decides not to use available and
applicable voluntary consensus standards.

This action does not involve technical standards.  Therefore, EPA did
not considering the use of any voluntary consensus standards.

List of Subjects

40 CFR Part 51

	Environmental protection, Administrative practice and procedures, Air
pollution control, Intergovernmental relations.

40 CFR Part 52

	Add list

____________________

Dated:

_____________________

Stephen L. Johnson,

Administrator.

Draft Regulatory Language

(To illustrate for purposes of drafting and review, the existing
language is in plain text, text we propose to add is in bold and text we
propose to delete is in strikeout.  We will reformat this prior to
submissions to the Office of Federal Register).

40 CFR 51.166(b)(13) / 40 CFR 52.21(b)(13)

	(i)  Baseline concentration means that ambient concentration level that
exists in the baseline area at the time of the applicable minor source
baseline date.  A baseline concentration is determined  for each
pollutant for which a minor source baseline date is established and
shall include:

	(a)  The actual emissions, as defined in paragraph (f)(1) of this
section, representative of sources in existence on the applicable minor
source baseline date, except as provided in paragraph (b)(13)(ii) of
this section;

	(b)  The allowable emissions of major stationary sources that commenced
construction before the major source baseline date, but were not in
operation by the minor source baseline date.

 	(ii)  The following will not be included in the baseline concentration
and will affect the applicable maximum allowable increase(s):

	(a)  Actual emissions, as defined in paragraph (f)(1) of this section,
from any major stationary source on which construction commenced after
the major source baseline date; and

	(b)  Actual emissions increases and decreases, as defined in paragraph
(f)(1) of this section, at any stationary source (including stationary,
mobile, and area sources) occurring after the minor source baseline
date.

40 CFR 51.166(b)(21) / 40 CFR 52.21(b)(21).

(i)  Actual emissions means the actual rate of emissions of a regulated
NSR pollutant from an emissions unit, as determined in accordance with
paragraphs (b)(21)(ii) through (iv) of this section, except that this
definition shall not apply for calculating whether a significant
emissions increase has occurred, or for establishing a PAL under
paragraph (w) of this section, or for determining consumption of ambient
air increments.  Instead, paragraphs (b)(40), and (b)(47), and (f)(1) of
this section shall apply for those purposes.

§51.166  Prevention of significant deterioration of air quality.

* * * * *

	(f)  Methods for determining increment consumption.

(1)  Actual emissions.  For purposes of determining consumption of the
ambient air increments set forth in paragraph (c), the plan may define
“actual emissions” in accordance with paragraphs (f)(1)(i) through
(vi) of this section.

(i)  Actual emissions shall be calculated based on information that, in
the judgment of the reviewing authority, provides the most reliable,
consistent, and representative indication of the emissions from a unit
or group of units in an increment consumption analysis as of the
baseline date and on subsequent dates.  In general, actual emissions for
a specific unit should be calculated using the unit’s actual operating
hours, production rates, and types of materials processed, stored, or
combusted during the selected time period.  However, where records of
actual operating hours, production rates, and composition of materials
are not available or are incomplete, the reviewing authority shall use
its best professional judgment to estimate these parameters from
available information in accordance with the criteria in this paragraph.
 When available and consistent with the criteria in this paragraph, data
from continuous emissions monitoring systems may be used.

(ii)  In general, when evaluating consumption of an increment averaged
over an annual time period, actual emissions as of a particular date in
an increment consumption assessment (the applicable baseline date or the
current time period) shall equal the average rate, in tons per year, at
which the unit actually emitted the pollutant during a consecutive
24-month period which precedes the particular date and which is
representative of normal source operation.

(iii)  When evaluating consumption of an increment averaged over a
period of less than one year (i.e., 24-hour or 3-hour averaging), actual
emissions as of a particular date in an increment consumption assessment
(the applicable baseline date or the current time) may  equal the
average rate, for the applicable averaging time, at which the unit
actually emitted the pollutant during a consecutive 24-month period
which precedes the particular date.  The average rate may be calculated
by dividing an annual rate by the number of hours the unit was actually
operating over the annual period.  The reviewing authority may use an
actual maximum rate over a 24-month period when sufficient data are
available to produce a consistent, reliable, and representative analysis
of the change in emissions from baseline to the current time period.

(iv)  The reviewing authority may allow actual emissions to be based on
different time period than the 24 months preceding a particular date
upon a determination that such period is more representative of normal
source operation as of the particular date, based upon credible
information showing that the unit’s operations in the 24 months
preceding the date were not typical of operations as of the particular
date.  A period after the particular date may be used, but only if such
period is more representative of normal source operations as of the
particular date and is not representative of normal source operations
first occurring after the particular date.  Operations occurring prior
to a particular date are not representative of normal source operations
for a particular date if they permanently ceased more than 24 months
prior to that date.  The different time period shall be a consecutive
24-month period unless two non-consecutive 12-month periods are
demonstrated to be more representative of normal source operation as
described above.

(v)  The reviewing authority may use source-specific allowable emissions
for the unit instead of the actual emissions of the unit.

(vi)  For any modified emissions unit that has not begun normal
operations on the date of an increment consumption assessment, actual
emissions shall equal the projected actual emissions of the unit on that
date.  For any new emissions unit that has not begun normal operations
on the date of an increment consumption assessment, the actual emissions
on the date the new source begins operations shall equal the potential
to emit for that source.

	(vii)  To the extent any requirement of this paragraph (f)(1) conflicts
with a recommendation in appendix W of this part, paragraph (f)(1) shall
control.

	(2)  Exclusions from increment consumption.  The plan may provide ...
[existing provisions of paragraphs (f)(1)(i) – (iv)]

	(v)  Concentrations attributable to sources that obtained a permit
based on a variance issued pursuant to paragraphs (p)(4) of this
section, but only with respect to the Class I increment in the area for
which the variance was issued.  Concentrations attributable to such
sources shall continue to be included in determining compliance with the
maximum allowable increase set forth in paragraphs (p)(4).

* * * * *

	(p)   * * *

	(5)  * * *

	(i)  The owner or operator of a proposed source or modification which
cannot be approved under procedures developed pursuant to paragraph (q)
(p)(4) of this section may demonstrate to the Governor that the source
or modification cannot be constructed by reason of any maximum allowable
increase for sulfur dioxide for periods of twenty-four hours or less
applicable to any Class I area and, in the case of Federal mandatory
Class I areas, that a variance under this clause would not adversely
affect the air quality related values of the area (including
visibility);

* * * * *

	(iii)  If such variance is granted, the reviewing authority may issue a
permit to such source or modification in accordance with provisions
developed pursuant to paragraph (q) (p)(7) of this section:  Provided,
That the applicable requirements of the plan are otherwise met.

	(6)  * * *

	(iii)  If such a variance is approved, the reviewing authority may
issue a permit in accordance with provisions developed pursuant to the
requirements of paragraph (q) (p)(7) of this section:  Provided, That
the applicable requirements of the plan are otherwise met.

	(7)  Emission limitations for Presidential or gubernatorial variance.
The plan shall provide that in the case of a permit issued under
procedures developed pursuant to paragraph (q) (p)(5) or (6) of this
section, * * *

§52.21  Prevention of significant deterioration of air quality.

* * * * *

Paragraph (f) is currently Reserved in §52.21.

	(f)  Methods for determining increment consumption.

(1)  Actual emissions.  For purposes of determining consumption of the
ambient air increments set forth in paragraph (c), the term “actual
emissions” shall be defined in  accordance with paragraphs (f)(1)(i)
through (vi):

(i)  Actual emissions shall be calculated based on information that, in
the judgment of the reviewing authority, provides the most reliable,
consistent, and representative indication of the emissions from a unit
or group of units in an increment consumption analysis as of the
baseline date and on subsequent dates.  In general, actual emissions for
a specific unit should be calculated using the unit’s actual operating
hours, production rates, and types of materials processed, stored, or
combusted during the selected time period.  However, where records of
actual operating hours, production rates, and composition of materials
are not available or are incomplete, the reviewing authority shall use
its best professional judgment to estimate these parameters from
available information in accordance with the criteria in this paragraph.
 When available and consistent with the criteria in this paragraph, data
from continuous emissions monitoring systems may be used.

(ii)  In general, when evaluating consumption of an increment averaged
over an annual time period, actual emissions as of a particular date in
an increment consumption assessment (the applicable baseline date or the
current time period) shall equal the average rate, in tons per year, at
which the unit actually emitted the pollutant during a consecutive
24-month period which precedes the particular date and which is
representative of normal source operation.

(iii)  When evaluating consumption of an increment averaged over a
period of less than one year (i.e. 24-hour or 3-hour averaging), actual
emissions as of a particular date in an increment consumption assessment
(the applicable baseline date or the current time) may equal the average
rate, for the applicable averaging time, at which the unit actually
emitted the pollutant during a consecutive 24-month period which
precedes the particular date.  The average rate may be calculated by
dividing an annual rate by the number of hours the unit was actually
operating over the annual period.  The reviewing authority may use an
actual maximum rate over a 24-month period when sufficient data are
available to  produce a consistent, reliable, and representative
analysis of the change in emissions from baseline to the current time
period.

(iv)  The reviewing authority may allow actual emissions to be based on
a different time period than the 24 months preceding a particular date
upon a determination that such period is more representative of normal
source operation as of the particular date, based upon credible
information showing that the unit’s operations in the 24 months
preceding the date were not typical of operations as of the particular
date.  A period after the particular date may be used, but only if such
period is more representative of normal source operations as of the
particular date and is not representative of normal source operations
first occurring after the particular date.  Operations occurring prior
to a particular date are not representative of normal source operations
for a particular date if they permanently ceased more than 24 months
prior to that date.  The different time period shall be a consecutive
24-month period unless two non-consecutive 12-month periods are
demonstrated to be more representative of normal source operation as
described above.

(v)  The reviewing authority may use source-specific allowable emissions
for the unit instead of the actual emissions of the unit.

(vi)  For any modified emissions unit that has not begun normal
operations on the date of an increment consumption assessment, the
actual emissions on the date the source begins operation shall equal the
projected actual emissions of the unit on that date.  For any new
emissions unit that has not begun normal operations on the date of an
increment consumption assessment, the actual emissions on the date the
new source begins operations shall equal the potential to emit for that
source.

	(vii)  To the extent any requirement of this paragraph (f)(1) conflicts
with a recommendation in 40 CFR part 51, appendix W, paragraph (f)(1)
shall control.

	(2)  Exclusions from increment consumption.  In determining compliance
with the maximum allowable increase, the Administrator may exclude
concentrations attributable to sources that obtained a permit based on a
variance issued pursuant to paragraphs (p)(5) of this section, but only
with respect to the Class I increment in the area for which the variance
was issued.  Concentrations attributable to such sources shall continue
to be included in determining compliance with the maximum allowable
increases set forth in paragraph (p)(5).

* * * * *

	(p)  * * *

	(6)  Sulfur dioxide variance by Governor with Federal Land Manager’s
concurrence.  The owner or operator of a proposed source or modification
which cannot be approved under paragraph (q)(4) (p)(5) of this section
may demonstrate to the Governor that the source cannot be constructed by
reason of any maximum allowable increase for sulfur dioxide for a period
of twenty-four hours or less applicable to any Class I area and, in the
case of Federal mandatory Class I areas, that a variance under this
clause would not adversely affect the air quality related values of the
area (including visibility).  The Governor, after consideration of the
Federal Land Manager’s recommendation (if any) and subject to his
concurrence, may, after notice and public hearing, grant a variance from
such maximum allowable increase.  If such variance is granted, the
Administrator shall issue a permit to such source or modification
pursuant to the requirements of paragraph (q)(7) (p)(8) of this section:
 Provided, That the applicable requirements of this section are
otherwise met.

	(7)  Variance by the Governor with the President’s concurrence.  In
any case where the Governor recommends a variance in which the Federal
Land Manager does not concur, the recommendations of the Governor and
the Federal Land Manager shall be transmitted to the President.  The
President may approve the Governor’s recommendation if he finds that
the variance is in the national interest.  If the variance is approved,
the Administrator shall issue a permit pursuant to the requirements of
paragraph (q)(7) (p)(8) of this section:  Provided, That the applicable
requirements of this section are otherwise met.

	(8)  Emission limitations for Presidential or gubernatorial variance.
In the case of a permit issued pursuant to paragraph (q)(5) or (6)
(p)(6) or (7) of this section, * * *

 Where a State does not have a SIP-approved program and chooses not to
accept delegation of the Federal PSD program, EPA implements the PSD
requirements as the reviewing authority within that jurisdiction.  In
addition, we implement the PSD program in Indian country until such time
as a Tribe elects to adopt, and we approve, a Tribal Implementation Plan
(TIP) that contains a PSD program that meets the requirements of the
Act.

 Baseline dates are pollutant specific.  That is, a complete PSD
application establishes the baseline date only for those regulated NSR
pollutants that are projected to be emitted in significant amounts (as
defined in the regulations) by the applicant’s new source or
modification.  Thus, an area may have different baseline dates for
different pollutants.

 This document is often referred to as the “Puzzle Book” due to the
depiction of jigsaw puzzle pieces on its cover.

 The cited regulations actually apply to sources located in a PSD area,
which must demonstrate that they will not cause or contribute to a
violation of the NAAQS in an adjacent nonattainment area.  This
demonstration may be made by showing that the emissions from the PSD
source alone are below the significant impact levels set forth in 40 CFR
51.165(b)(2).  Based on EPA interpretations and guidance, these
significant impact levels have also been widely used in the PSD program
to define the extent of the impact area where an increment analysis must
be performed.  We proposed to codify these significant impact levels for
use in the PSD program in 1996 as part of a comprehensive proposal to
revise the major NSR regulations.  See 61 FR 38250, 38325, July 23,
1996.  We have not yet taken final action on this proposal.

 The proposed source is deemed to “cause or contribute to” an
increment violation if the modeling shows that the impact attributable
to the source at the time and place of the violation is greater than the
relevant significant impact level.

 “Recommendations for Improving the Prevention of Significant
Deterioration Program.”  Stuart A. Clark, President, Western States
Air Resources Council, May 19, 2005.

 In addition to WESTAR’s recommendations, we received comments from
the Northeast States for Coordinated Air Use Management (NESCAUM) on the
WESTAR recommendations in a letter and attachment from Arthur N. Marin,
Executive Director of NESCAUM, October 18, 2005.

 “A second test of protection is provided in specified Federal land
areas (Class I areas), such as national parks and wilderness areas;
these areas are also subjected to a review process based on the effect
of pollution on the area's air quality related values.”  S. Rep.
95-127, at 17, 4 LH at 1401.

 “The class I increment is a test for determining where the burden of
proof lies and is an index of changes in air quality.   It is not the
final determinant for approval or disapproval of a permit
application.”   S. Rep. 95-127 at 35.

 At the time of that decision, this language was contained in
§51.24(a)(3) of EPA’s regulations.   See 636 F.2d at 361 n. 92.

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