Operating Permit Programs; Flexible Air Permitting Rule

Response to Comments

Air Quality Policy Division

Office of Air Quality Policy and Standards

U. S. Environmental Protection Agency

Research Triangle Park, NC  27711

January 2009TABLE OF CONTENTS

  TOC \o "1-3" \h \z \u    HYPERLINK \l "_Toc219196855"  LIST OF
ACRONYMS AND ABBREVIATIONS	  PAGEREF _Toc219196855 \h  iii

  HYPERLINK \l "_Toc219196856"  1	Introduction	  PAGEREF _Toc219196856
\h  1

  HYPERLINK \l "_Toc219196857"  1.1	Background	  PAGEREF _Toc219196857
\h  1

  HYPERLINK \l "_Toc219196858"  1.2	The Commenters	  PAGEREF
_Toc219196858 \h  1

  HYPERLINK \l "_Toc219196859"  1.3	Organization of This Document
PAGEREF _Toc219196859 \h  1

  HYPERLINK \l "_Toc219196860"  2	General Comments on the Proposal
PAGEREF _Toc219196860 \h  7

  HYPERLINK \l "_Toc219196861"  3	Comments on Advance Approval	  PAGEREF
_Toc219196861 \h  9

  HYPERLINK \l "_Toc219196862"  3.1	Comments on Proposal Preamble
Discussion of Advance Approval	  PAGEREF _Toc219196862 \h  9

  HYPERLINK \l "_Toc219196863"  3.2	Comments on Revision to Application
Requirements for Emissions Caps [§70.5(c)(3)(iii)]	  PAGEREF
_Toc219196863 \h  11

  HYPERLINK \l "_Toc219196864"  4	Comments on Alternative Operating
Scenarios (AOSs)	  PAGEREF _Toc219196864 \h  14

  HYPERLINK \l "_Toc219196865"  4.1	General Comments on AOSs	  PAGEREF
_Toc219196865 \h  14

  HYPERLINK \l "_Toc219196866"  4.2	Comments on the Definition of AOS
PAGEREF _Toc219196866 \h  17

  HYPERLINK \l "_Toc219196867"  4.3	Comments on Proposed Uses of AOSs
PAGEREF _Toc219196867 \h  21

  HYPERLINK \l "_Toc219196868"  4.3.1	Comments on Switching Between
Compliance Options	  PAGEREF _Toc219196868 \h  21

  HYPERLINK \l "_Toc219196869"  4.3.2	Comments on the Relationship
Between AOSs and Advance Approvals	  PAGEREF _Toc219196869 \h  22

  HYPERLINK \l "_Toc219196870"  4.4	Comments on Revisions for Consistent
AOS Terminology	  PAGEREF _Toc219196870 \h  23

  HYPERLINK \l "_Toc219196871"  4.5	Comments on Revisions to Application
Requirements for AOSs	  PAGEREF _Toc219196871 \h  24

  HYPERLINK \l "_Toc219196872"  4.5.1	Comments on the Clarification of
the Types of Additional Information that May Be Requested on AOSs
[§70.5(c)(7)]	  PAGEREF _Toc219196872 \h  25

  HYPERLINK \l "_Toc219196873"  4.5.2	Comments on Requirements for
Documentation of Necessary Authorizations [§70.5(c)(7)]	  PAGEREF
_Toc219196873 \h  25

  HYPERLINK \l "_Toc219196874"  4.5.3	Comments on Requirement for
Compliance Plans [§70.5(c)(8)]	  PAGEREF _Toc219196874 \h  26

  HYPERLINK \l "_Toc219196875"  4.6	Comments on Revisions to Permit
Content Requirements for AOSs (§70.6)	  PAGEREF _Toc219196875 \h  26

  HYPERLINK \l "_Toc219196876"  4.6.1	Comments on Semiannual Reports
[§70.6(a)(3)(iii)(A)]	  PAGEREF _Toc219196876 \h  26

  HYPERLINK \l "_Toc219196877"  4.6.2	Comments on Log Content
[§70.6(a)(9)(i)]	  PAGEREF _Toc219196877 \h  27

  HYPERLINK \l "_Toc219196878"  4.6.3	Comments on Permit Shields for
AOSs [§70.6(a)(9)(ii)]	  PAGEREF _Toc219196878 \h  29

  HYPERLINK \l "_Toc219196879"  4.6.4	Comments on Permit Content to
Describe AOSs [§70.6(a)(9)(iii)]	  PAGEREF _Toc219196879 \h  29

  HYPERLINK \l "_Toc219196880"  4.6.5	Comments on Requirement for All
Needed Authorization [§70.6(a)(9)(iii)]	  PAGEREF _Toc219196880 \h  30

  HYPERLINK \l "_Toc219196881"  4.7	Other Comments on AOSs	  PAGEREF
_Toc219196881 \h  30

  HYPERLINK \l "_Toc219196882"  5	Comments on Approved Replicable
Methodologies (ARMs)	  PAGEREF _Toc219196882 \h  34

  HYPERLINK \l "_Toc219196883"  5.1	General Comments on ARMs	  PAGEREF
_Toc219196883 \h  34

  HYPERLINK \l "_Toc219196884"  5.2	Comments on the Use of ARMs to
Adjust Operating Parameter Limits	  PAGEREF _Toc219196884 \h  37

  HYPERLINK \l "_Toc219196885"  5.3	Other Comments on ARMs	  PAGEREF
_Toc219196885 \h  41

  HYPERLINK \l "_Toc219196886"  6	Comments on Green Groups	  PAGEREF
_Toc219196886 \h  44

  HYPERLINK \l "_Toc219196887"  6.1	Overall Summary of Comments and
EPA's Final Action	  PAGEREF _Toc219196887 \h  44

  HYPERLINK \l "_Toc219196888"  6.2	General Comments on Green Groups
PAGEREF _Toc219196888 \h  48

  HYPERLINK \l "_Toc219196889"  6.2.1	Comments on Whether Green Groups
Should Be Mandatory	  PAGEREF _Toc219196889 \h  49

  HYPERLINK \l "_Toc219196890"  6.2.2	Comments on the Benefits of Green
Groups	  PAGEREF _Toc219196890 \h  52

  HYPERLINK \l "_Toc219196891"  6.2.3	Comments on Public Participation
PAGEREF _Toc219196891 \h  53

  HYPERLINK \l "_Toc219196892"  6.2.4	Other General Comments	  PAGEREF
_Toc219196892 \h  53

  HYPERLINK \l "_Toc219196893"  6.3	Comments on the Scope Green Groups
PAGEREF _Toc219196893 \h  53

  HYPERLINK \l "_Toc219196894"  6.3.1	Comments on Removing Units in a
Green Group	  PAGEREF _Toc219196894 \h  53

  HYPERLINK \l "_Toc219196895"  6.3.2	Comments on Emissions Units Being
Routed to a Common Control Device	  PAGEREF _Toc219196895 \h  54

  HYPERLINK \l "_Toc219196896"  6.3.3	Comments on Green Groups
Authorization	  PAGEREF _Toc219196896 \h  56

  HYPERLINK \l "_Toc219196897"  6.3.4	Other Comments on the Scope of
Green Groups	  PAGEREF _Toc219196897 \h  60

  HYPERLINK \l "_Toc219196898"  6.4	Comments on the Emissions Limits of
Green Groups	  PAGEREF _Toc219196898 \h  61

  HYPERLINK \l "_Toc219196899"  6.4.1	Comments on Baseline Emissions
PAGEREF _Toc219196899 \h  61

  HYPERLINK \l "_Toc219196900"  6.4.2	Comments on Fugitive Emissions
PAGEREF _Toc219196900 \h  62

  HYPERLINK \l "_Toc219196901"  6.4.3	Comments on Prior Limits	  PAGEREF
_Toc219196901 \h  62

  HYPERLINK \l "_Toc219196902"  6.4.4	Comments on Pollution Prevention
(P2)	  PAGEREF _Toc219196902 \h  63

  HYPERLINK \l "_Toc219196903"  6.4.5	Comments on an Aggregate Emissions
Limit	  PAGEREF _Toc219196903 \h  65

  HYPERLINK \l "_Toc219196904"  6.4.6	Comments on the Annual Emissions
Limit	  PAGEREF _Toc219196904 \h  65

  HYPERLINK \l "_Toc219196905"  6.4.7	Comments on Advance Approvals
PAGEREF _Toc219196905 \h  67

  HYPERLINK \l "_Toc219196906"  6.4.8	Comments on Offsets	  PAGEREF
_Toc219196906 \h  67

  HYPERLINK \l "_Toc219196907"  6.4.9	Other Comments on the Emission
Limits of Green Groups	  PAGEREF _Toc219196907 \h  68

  HYPERLINK \l "_Toc219196908"  6.5	Comments on the Monitoring,
Recordkeeping, Reporting, and Testing (MRRT) Requirements for Green
Groups	  PAGEREF _Toc219196908 \h  68

  HYPERLINK \l "_Toc219196909"  6.6	Comments on the Duration and Renewal
of the Green Group Designations	  PAGEREF _Toc219196909 \h  71

  HYPERLINK \l "_Toc219196910"  6.6.1	Comments on Contemporaneity of
Construction Requirements [§§52.21(r)(2) & 52.1666(j)(4)]	  PAGEREF
_Toc219196910 \h  71

  HYPERLINK \l "_Toc219196911"  6.6.2	Comments on Renewal of Green
Groups	  PAGEREF _Toc219196911 \h  73

  HYPERLINK \l "_Toc219196912"  6.6.3	Comments on the Dividing Up Green
Groups After Expiration	  PAGEREF _Toc219196912 \h  74

  HYPERLINK \l "_Toc219196913"  6.6.4	Comments on the Duration for a
Green Group Designation	  PAGEREF _Toc219196913 \h  74

  HYPERLINK \l "_Toc219196914"  6.6.5	Comments on the Advancement of
Control Technology	  PAGEREF _Toc219196914 \h  78

  HYPERLINK \l "_Toc219196915"  6.6.6	Other Comments on the Duration and
Renewal of Green Group Designations	  PAGEREF _Toc219196915 \h  79

  HYPERLINK \l "_Toc219196916"  6.7	Comments on the How Green Groups are
Similar to PALs	  PAGEREF _Toc219196916 \h  80

  HYPERLINK \l "_Toc219196917"  6.8	Comments on the Legal Rationale for
Green Groups	  PAGEREF _Toc219196917 \h  81

  HYPERLINK \l "_Toc219196918"  7	Miscellaneous Comments	  PAGEREF
_Toc219196918 \h  85

LIST OF ACRONYMS AND ABBREVIATIONS

Act	Clean Air Act (42 U.S.C. 7401 - 7671q)

AOS	Alternative Operating Scenario

ARM	Approved Replicable Methodology

BACT	Best Available Control Technology

BARCT	Best Available Retrofit Control Technology

CAA	Clean Air Act (42 U.S.C. 7401 - 7671q)

CAM	Compliance Assurance Monitoring

CFR	Code of Federal Regulations

D.C. Cir. 	D.C. Circuit Court of Appeals

EGU	Electrical Generating Unit

EPA	Environmental Protection Agency

FAP	Flexible Air Permit

FIP	Federal Implementation Plan

FR	Federal Register

LAER	Lowest Achievable Emission Rate

MACT	Maximum Achievable Control Technology

MRR	Monitoring, Recordkeeping, and Reporting

NA	Nonattainment

NAAQS	National Ambient Air Quality Standards

NACAA	National Association of Clean Air Agencies

NA NSR	Nonattainment Major New Source Review

NEI	National Emissions Inventory

NESHAP	National Emission Standard for Hazardous Air Pollutants

NOx	Nitrogen Oxides

NSPS	New Source Performance Standards

NSR	New Source Review

P2	Pollution Prevention

PAL	Plantwide Applicability Limitation

PSD	Prevention of Significant Deterioration

R&D	Research and Development

RACT	Reasonably Available Control Technology

SIC	Standard Industrial Classification

SIP	State Implementation Plan

SSM	Startup, Shutdown, and Malfunction

TIP	Tribal Implementation Plan

TPY	Tons Per Year

TRI	Toxic Release Inventory

VOC	Volatile Organic Compound

Introduction

Background

The EPA (we) proposed the Flexible Air Permitting Rule on September 12,
2007 (72 FR 52206).  This action proposed to revise the regulations
governing state and federal operating permit programs required by title
V of the Clean Air Act (the Act) and the New Source Review (NSR)
programs required by parts C and D of title I of the Act to explicitly
allow for certain approaches to flexible air permits (FAPs).
Specifically, we discussed and proposed regulatory revisions for advance
approval of types or classes of changes under minor NSR, alternative
operating scenarios (AOSs), approved replicable methodologies (ARMs),
and Green Groups.

The original deadline for public comments on the proposal was November
13, 2007.  However, after we received timely requests to extend the
comment period, we extended the deadline to January 14, 2008 (72 FR
59065, October 18, 2007).

This document presents a summary of the significant public comments that
we received on the September 12, 2007 proposal, along with our responses
to those comments.  The document supports the final rulemaking,
“Operating Permit Programs; Flexible Air Permitting Rule.”  We refer
to this rulemaking as the “FAP Rule” in the remainder of this
document.  The responses presented in this document are intended to
augment the responses to comments that appear in the preamble to the
final rule or to address comments not discussed in the preamble to the
final rule.  Although portions of the preamble to the final rule are
paraphrased in this document where useful to add clarity to responses,
to the extent any ambiguity is introduced by this paraphrasing, the
preamble itself remains the definitive explanation of the final rule.

The Commenters

We received a total of 38 unique comments (i.e., not including
duplicates) on the proposal.  The commenters can be broken down by
general type as follows: 16 state/local air agencies or air agency
associations, 12 industry or industry association commenters,
1 environmental advocacy group, 1 federal government agency, 3 private
citizens, 4 tribes, and 1 "other" commenter.  The commenters are
listed in Table 1, which appears at the end of this section.

Organization of This Document

After this introductory section, this document is divided into six
additional sections.  The sections address the following topics:

Section 2 – General Comments.

Section 3 – Advance Approval.

Section 4 – Alternative Operating Scenarios (AOSs).

Section 5 – Approved Replicable Methodologies (ARMs).

Section 6 – Green Groups.

Section 7 – Miscellaneous Comments.

Table 1.  List of Commenters

DOCKET ID a, b 	COMMENT DESCRIPTION	TYPE OF COMMENTER	COMMENTS

0053	Comment submitted by A. Grimes 	Private Citizen

	0055	Comment submitted by M. Hibbs 	Private Citizen

	0056	Comment and attachment submitted by M. Peloso 	Private Citizen

	0057	Comment and attachment submitted by Cindy McComas, Director,
Minnesota Technical Assistance Program (MnTAP) 	Other

	0059	Comment submitted by Mark Steinberg, Air Quality Manager, S. C.
Johnson & Son, Inc (SCJ) 	Industry

	0061	Comment and attachment submitted by Robin Clark, Air Quality
Specialist, Environmental Services Department, Little Traverse Bay Bands
of Odawa Indians 	Tribe

	0062	Comment and attachment submitted by John A. Paul, Administrator,
Regional Air Pollution Control Agency (RAPCA) 	State/Local	Supported
comments made by NACAA (0089)

0063	Comment submitted by Roy Wood, Kodak Health Safety and Environment
Division, Eastman Kodak Company (Kodak) 	Industry

	0064	Comment submitted by Daniel Muray, Assistant Commissioner Office
of Air Quality, Indiana Department of Environmental Management (IDEM)
State/Local

	0065	Comment and attachment submitted by Barry R. Wallerstein, Doctor
of Environmental Sciences and Engineering, Executive Officer, South
Coast Air Quality Management District (SCAQMD) 	State/Local	Supported
comments made by NACAA (0089)

0066	Comment and attachment submitted by Brandy Toft, Air Quality
Specialist, Leech Lake Band of Ojibwe 	Tribe

	0067	Comment submitted by Brandy Toft, Air Quality Specialist, Leech
Lake Band of Ojibwe 	Tribe	Duplicate of 0066

0068	Comment and attachment submitted by Bernard Paul, Eli Lilly and
Company 	Industry

	0069	Comment and attachment submitted by Jeff J. Smith, Manager, Air
Quality Permits Section, Industrial Division, Minnesota Pollution
Control Agency (MPCA) 	State/Local

	0070	Comment and attachment submitted by Robert D. Bessette, President,
Council of Industrial Boiler Owners (CIBO) 	Industry

	0071	Comment and attachment submitted by David Friedman, Director,
Environmental Affairs, National Petrochemical and Refiners and
Association (NPRA) 	Industry

	0072	Comment and attachment submitted by Maida O. Lerner, Hunton &
Williams on behalf of Utility Air Regulatory Group (UARG) 	Industry

	0073	Comment and attachment submitted by Leslie Sue Ritts, Counsel to
National Environmental Development Association's Clean Air Project
(NEDA/CAP) 	Industry

	0074	Comment and attachment submitted by Terry Behrman, Manager,
Environmental Affairs, Alliance of Automobile Manufacturers 	Industry

	0075	Comment and attachment submitted by Kirk A. Saffell, Vice
President, Health, Safety and Environmental, Valero Energy Corporation
Industry

	0076	Comment and attachment submitted by Ted Steichen, Advisor,
American Petroleum Institute (API) 	Industry

	0077 	Comment and attachment submitted by Air Permitting Forum
Industry

	0078	Comment submitted by Karen R. Diver, Chairwoman, Fond du Lac
Reservation Business Committee, Fond du Lac Band of Lake Superior
Chippewa 	Tribe

	0079	Comment submitted by Ram K. Singhal, Vice President, Technology &
Environmental Strategy, Flexible Packaging Association (FPA) 	Industry

	0080	Comment and attachment submitted by Thomas K. Fidler, Deputy
Secretary for Waste, Air and Radiation Management, Pennsylvania
Department of Environmental Protection (PADEP) 	State/Local

	0081	Comment submitted by William O’Sullivan, Director, Division of
Air Quality, New Jersey Department of Environmental Protection (NJDEP)
State/Local	Supported comments made by NACAA (0089)

0082	Comment and attachment submitted by Jon E. Kallen, Manager,
Environmental Policy and Strategy, MidAmerican Energy Company 	Industry

	0083	Comment and attachment submitted by Harold P. Quinn, Jr.,
Executive Vice President and General Counsel, National Mining
Association (NMA) 	Industry

	0084	Comment submitted by Russell A. Wozniak, Environment, Health and
Safety Operations Regulatory Management, The Dow Chemical Company (Dow)
Industry

	0085	Comment and attachment submitted by David J. Shaw, Director,
Division of Air Resources, New York State Department of Environmental
Conservation (NYSDEC)	State/Local

	0086 	Comment and attachment submitted by Air Permitting Forum
Industry	Duplicate of 0077

0087	Comment submitted by Ali Mirzakhalili, Administrator, Division of
Air and Waste Management, Department of Natural Resources &
Environmental Control, State of Delaware 	State/Local

	0088	Comment submitted by John D. Walke, Director, Clean Air Program,
Natural Resources Defense Council (NRDC) 	Environmental

	0089	Comment and attachments submitted by Bob Hodanbosi and Ursula
Kramer, Co-Chairs, Permitting Committee, National Association of Clean
Air Agencies (NACAA) 	State/Local

	0090	Comment and attachments submitted by Alan R. Newman, P.E., Senior
Air Quality Engineer, Washington State Department of Ecology
State/Local

	0091	Comment and attachment submitted by Terry Behrman, Manager,
Environmental Affairs, Alliance of Automobile Manufacturers 	Industry
Duplicate of 0074

0092	Comment and attachment submitted by Nancy C. Wrona, Director, Air
Quality Division, Arizona Department of Environmental Quality (ADEQ)
State/Local	Supported comments made by NACAA (0089)

0093	Comment and attachment submitted by Rosa Maria S. Abreu, Assistant
Director, San Diego County Air Pollution Control District 	State/Local
Supported comments made by NACAA (0089)

0094	Comment submitted by James L. Kavanaugh, Director, State of
Missouri Department of Natural Resources 	State/Local

	0095	Comment submitted by Mark V. Goodin, Olympic Regional Air Agency
and Alan R. Newman, Senior Air Quality Engineer, State of Washington
Department of Ecology 	State/Local	Duplicate of 0090

0096	Comment submitted by William H. Lewis, Counselor at Law, Morgan,
Lewis & Bockius LLP, on behalf of the Clean Air Implementation Project
and American Chemistry Council 	Industry

	0097	Comment submitted by John A. Paul, Administrator, Regional Air
Pollution Control Agency (RAPCA) 	State/Local	Duplicate of 0062

0098	Comment submitted by Jeff J. Smith, Manager, Air Quality Permits
Section, Industrial Division, Minnesota Pollution Control Agency (MPCA)
State/Local	Duplicate of 0069

0099	Comment submitted by Andrew C. Lawrenc, Director, Office of Nuclear
Safety and Environment, Department of Energy (DOE) 	Federal

	0100	Comment submitted by Barry R. Wallerstein, Executive Director,
South Coast Air Quality Management District (SCAQMD) 	State/Local
Duplicate of 0065

0101	Comment submitted by Karen R. Diver, Chairwoman, Fond du Lac
Reservation Business Committee 	Tribe	Duplicate of 0078

0102	Comment submitted by Kirk A. Saffell, Vice President, Health,
Safety and Environmental, Valero Energy Corporation (Valero) 	Industry
Duplicate of 0075

0103	Comment submitted by Rosa Maria Abreu, Assistant Director, Air
Pollution Control District, County of San Diego 	State/Local	Duplicate
of 0093

0104	Comment submitted by Ali Mirzakhalili, P.E, Administrator,
Department of Natural Resources & Environmental Control, Division of Air
& Waste Management, State of Delaware 	State/Local	Duplicate of 0087

a  Docket ID identifies comments found in Docket No.
EPA-HQ-OAR-2004-0087 by document number.

b  Documents submitted to the docket together appear in the docket as
multiple documents with the same 4-digit “root number” followed by a
unique extension.  For example, comments received via email are
generally assigned two numbers.  First, the email message itself is
assigned the root number (e.g., 0137).  Second, the attached comment
document is assigned an extended number based on the root number (e.g.,
0137.1).  Additional attachments, if any, would follow the same pattern
(e.g., 0137.2, 0137.3, etc.).  For the purposes of this table, we list
all related documents under the root number (e.g., 0137).  In the text
of the comment summary, we identify the source by the entire document
number (e.g., 0137.1).

General Comments on the Proposal

Supportive Comments:

One air agency (0064), eight industry commenters (0059, 0068.1, 0070.1,
0071.1, 0072.1, 0074.1, 0082, 0084), one federal agency (0099), and two
private citizens (0053, 0056) generally supported EPA’s efforts to
facilitate the use of flexible air permits (FAPs).  The commenters
generally stated that FAPs will increase permit efficiency, provide
greater administrative flexibility and regulatory certainty, and promote
continuous improvement at regulated facilities.  The industry commenters
also generally stated that the FAPs will provide greater operational
flexibility.  A number of the commenters noted that many of the
flexibility approaches addressed in the proposal are already being
implemented by states under their existing regulations.  Some of the
commenters described the benefits that would accrue from FAPs.  (Despite
this overall support for the concept of flexible permits, many of these
commenters suggested changes to the specific elements of the proposal
and did not necessarily support additional requirements to facilitate
increased consideration of FAPs.)

Opposing Comments:

Seven air agencies (0065.1, 0080.1, 0085.1, 0087, 0089, 0090.1/0090.2,
0092.1), and three tribes (0061.1, 0066.1, 0078) generally opposed
EPA’s proposed FAP rule.  Several of the commenters stated that many
of the aspects of EPA's proposed rule are already being implemented
through the existing title V regulations, and that the provisions will
only further complicate the existing permitting process.  Some provided
examples of current state programs to simplify existing permitting
programs or implement flexible permitting, which they believe make the
proposed rule unnecessary.  Others indicated that the pilot permits do
not provide a basis for the proposed FAP rule and that the proposed rule
would not provide the benefits that EPA claimed.  Several of the
commenters also stated that provisions of the proposed FAP rule are best
left to the permitting authorities to implement on a voluntary,
case-specific basis.  In addition, the commenters generally opposed the
proposed Green Group provisions.

Response:

	Because commenters (both supportive and opposing) have generally found
that the flexibility approaches addressed in the proposal are available
to the extent needed and appropriate under existing authorities, and
that the existing permitting processes generally are sufficient and
effective for the reasonable consideration of FAP approaches, EPA is
convinced that more prescriptive approaches and additional requirements
as proposed to assure greater consistency may well be counterproductive
to our objective for greater consideration and appropriate use of FAP
approaches.  Consequently, the final action is primarily a reaffirmation
of currently available flexibility options and the process for accessing
them.  The final rule adds some new definitions and clarifications to
existing parts 70 and 71 provisions in order to promote greater
certainty and reasonable consideration of these options.  While deciding
not to prescribe specific approaches to the design and implementation of
FAPs (e.g., provisions for Green Groups), EPA does intend to monitor
state activities in these areas, to evaluate the effectiveness of
various FAP approaches periodically, and to assess, on the basis of new
experiences and other information, whether any additional guidance or
rulemaking would be appropriate in the future.

	The comments on specific aspects of the proposed rules are summarized
in Sections 3 through 6 of this document.  Where the comments are
related to actions taken in the final rule, we provide specific
responses.  Section 7 of this document summarizes other comments that
are related more to the subsequent implementation of FAP activities than
to the content of the final rule.

Comments on Advance Approval

Comments on Proposal Preamble Discussion of Advance Approval

Supportive Comments:

	One air agency (0087) and six industry commenters (0059, 0068.1,
0073.1, 0074.1, 0076.1, 0077.1) agreed with EPA statements in the
preamble encouraging advance approval of changes subject to minor new
source review (NSR).  Two of the these industry commenters (0074.1,
0077.1) stated that using advance approvals of minor NSR changes is
sound policy because it reduces permit revisions, increases awareness of
the public to planned changes at a facility, and minimize costs for both
sources and state agencies.  One of these industry commenters (0074.1)
stated that one of the most beneficial aspects of this proposal is its
encouragement of states to use flexible permitting approaches and to
bring such approaches into mainstream permitting rather than making them
the exception to the rule.  The commenter concurs with EPA that advance
minor NSR approvals should and can be included in title V permits under
the existing regulations, and believes EPA’s encouragement of advance
approvals in this rulemaking is helpful.  One air agency (0087) agreed
with developing widespread understanding and use of advance approvals,
and agreed that modification of any federal rule to codify the technique
is unnecessary and would likely do more harm than good.  One of the
industry commenters (0059) stated that the advance approval process will
also complement the flexibility provided by title V alternative
operating scenario (AOS) provisions.

	Another air agency (0069.1) and two additional industry commenters
(0084, 0096) also supported EPA's decision not to propose NSR rule
changes for advance approvals.  The air agency (0069.1) stated that
since many permits approve some sort of change or modification, there is
no need to call out a specific term or additional authority to grant
such an approval.  The commenter stated that states would use their
existing authorities and permit processes (e.g., minor NSR, major NSR,
etc.) to grant the necessary approval.  The two industry commenters
(0084, 0096) noted that EPA's proposal recognizes that many states have
issued advance approvals under their existing minor NSR programs.  These
industry commenters stated that the nature of advance approvals varies
and will, of necessity, require that they be tailored according to the
needs of specific facilities.

Opposing Comments:

	Two air agencies (0085.1, 0089) opposed the proposal preamble's
discussion of advance approvals.  One of these air agencies (0089)
stated that states do not want or need federal “encouragement” to
use and revise their minor NSR programs for advance approvals.  The
commenter stated that if EPA retains this rule (i.e., for areas other
than minor NSR, for which the Agency did propose rule revisions), which
the commenter recommends withdrawing, EPA should expunge the preamble of
encouraging advance approvals and other ambiguous language that could be
misinterpreted as having regulatory force.  The commenter also stated
that some of states lack an integrated title V/NSR permitting program,
and would have difficulty with advance-approved minor NSR changes.  The
commenter added that some state and local air agencies are simply unable
to carry out aspects of the proposed rule, for example, because their
minor NSR programs require BACT or LAER to be installed
contemporaneously on an emissions-unit basis.  The commenter stated that
in these jurisdictions, permitting authorities are unlikely to make
changes in their minor NSR programs, as they believe that such changes
would have detrimental impacts on their clean air obligations.

	One industry commenter (0065.1), while not opposing advance approvals
in general, stated that some of the examples EPA gives appear to be
inappropriate.  The commenter gave one such example, where EPA appears
to support the idea that an advance approval could be given to a source
even where the source does not know the size or number of new tanks it
will propose, or what materials will be stored in them.  The commenter
stated that in this case, it seems unlikely that the permitting
authority could determine what applicable requirements would have to be
imposed, or what offsets or BACT/LAER should be required, and therefore
suggested that the source should not be able to obtain advance approval
in this case.

Response:

Consistent with our proposal, we are not revising any part 51 provision
in order to require advance approvals under minor NSR (or under any
other applicable requirement).  We continue to believe that many states
are able to advance approve types or categories of changes under their
existing minor NSR programs, to the extent that they believe it is
appropriate to do so.  As mentioned by a commenter, EPA recognizes that
certain minor NSR rules are not as amenable to advance approval as are
others.  In particular, advance approvals under state rules that require
sources to employ best available technology, where judged to be open to
advance approval by the permitting authority and appropriate for use in
a particular case, may require additional permit terms as necessary to
assure that best available technology will be used.  Permitting
authorities, operating under their existing minor NSR regulations and
authorities, must include terms as necessary to ensure the practical
enforceability of advance approvals.  For example, for purposes of
tracking compliance with an emissions cap established in minor NSR, the
minor NSR permit should contain sufficient terms that collectively act
to monitor and quantify the relevant emissions at the site over the
applicable time period.

	While we believe that appropriately crafted advance approvals of minor
NSR can, in certain cases, facilitate operational flexibility while
protecting the environment (at least as effectively as would the
individual review of each change as it occurs), we clearly state in the
preamble to the final rule that the Agency does not intend to imply that
states should issue such advance approvals in any cases that would be
inconsistent with their existing rules or, in their judgment, would be
inappropriate.  As a general matter, the permitting authorities have
authority to decide, on a case-by-case basis, the merits of granting an
advance approval of minor NSR to a particular requesting source.
Additionally we state that EPA does not intend to imply that states must
revise their current rules to facilitate advance approvals in the
future.  Rather, where existing rules may limit advance approval
opportunities, EPA simply encourages states to consider the adoption of
more flexible minor NSR rules under the broad governing regulations in
40 CFR 51.160-51.164.  It is EPA’s policy to support state use of
advance approvals under minor NSR, where they deem them appropriate, and
particularly where states expect benefits similar to those found in our
evaluation of pilot permits to occur.

We also acknowledge that states, in order to respond to requests by
sources for advance approval of minor NSR, may incur additional up-front
development costs for which they may have to charge additional service
fees.  However, based on the pilot permit experience, annual
administrative costs associated with FAPs should decline over time and,
over the life of the permit, be less than those for conventional
permits.

We continue to believe that permitting authorities can consider, in the
context of their SIP-approved minor NSR programs, a wide spectrum of
situations for advance approval.  This would include the example
contained in the proposal preamble involving the potential addition of
new tanks to an existing tank farm, which was questioned by one
commenter as not being appropriate.  In disagreeing with the commenter,
we wish to point out that where a permitting authority opts to pursue
such an authorization, it must be able to ensure that each advance
approved change would be controlled to meet applicable requirements for
the pollutant(s) for which the advance approval is effective and that
the combination of emissions from these changes together  with existing
emissions at the source would not interfere with the relevant National
Ambient Air Quality Standards (NAAQS).  In the mentioned example, the
permitting authority accomplishes this for volatile organic compound
(VOC) emissions by including a table in the minor NSR permit that
replicably determines the required level of control based on the type
and size of new tank to be added and including a plantwide VOC emissions
cap set at a level both to function as a plantwide applicability
limitation (PAL) (i.e., major NSR for VOC would not apply) and to
safeguard the ozone NAAQS.  Note that this example addresses the advance
approval of minor rather than major NSR (which the commenter may have
misunderstood).

Comments on Revision to Application Requirements for Emissions Caps
[§70.5(c)(3)(iii)]

Supportive Comments:

	Two industry commenters (0073.1, 0096) supported the proposed addition
of language to clarify that a source with an approved annual emissions
cap can meet the title V permit application requirements of 40 CFR
70(c)(5)(3)(iii) by reporting only the aggregate emissions associated
with the cap in the permit application.

Opposing Comments:

	One air agency (0069.1) disagreed with the proposed rule changes to 40
CFR 70.5(c)(3)(iii) and believes that the current language is adequate.
The commenter stated that under a combined permit program, the permit
application must include all information needed to evaluate a given
activity which may include unit-by-unit potential or actual short or
long term emissions data.  The data may be used for several things
including control technology assessment, modeling, compliance
assessment, determining the appropriate level and frequency of
monitoring, etc., even if the unit is covered by an emissions cap.  The
commenter stated that if a unit is truly only subject to just the annual
emissions cap, the current language in 40 CFR 70.5(c)(3)(iii) should be
adequate to limit the need for further detail, and that adding the
sentence as proposed will lead to arguments with permittees over whether
or not the data is truly “needed to determine an applicable
requirement.”

Other Comments:

	Without explicitly supporting or opposing the proposal, one air agency
(0094) stated that EPA needs to explain the statements about reporting
emissions data for individual emissions units participating in an
emission cap (e.g., PALs, Green Groups, etc.).  The commenter stated
that the preamble seems to ignore the fact that federal regulations
require state agencies to collect emissions data from sources annually
and to include them as boilerplate attachments to permits.  These
emissions data requirements are much more specific than that indicated
in the explanation and were believed to be "applicable requirements" by
the commenter.  In addition, the emissions calculations or monitoring
conducted to aggregate the emissions to determine compliance with the
cap are not provided.  The commenter stated that without an explanation
of how cap determinations are derived, it is not possible to determine
if calculations are correct.

Response:

The Agency has decided to finalize the proposed revision to the title V
permit application requirements at 40 CFR 70.5(c)(3)(iii) with minor
changes.  As proposed, the final revisions clarify that for emissions
units subject to an annual emissions cap, the application may report the
units’ emissions as part of the aggregate emissions associated with
the cap, except where the permitting authority determines that more
specific information is needed.  The EPA agrees with the commenter who
wanted to assure that permitting authorities retained the ability to
require more unit-specific information as needed to develop permit terms
needed to assure compliance with all applicable requirements relevant to
emissions units included under the emissions cap.  As a result, the
final rule language now indicates that unit-specific information must be
provided whenever it is needed, including where necessary to determine
or assure compliance with an applicable requirement.

Regarding the comment about requirements for states to collect annual
emissions data from sources, we note that the revised provision applies
only to the content of the title V permit application for emissions
units under an annual emissions cap.  Thus, the rule revision has no
bearing on information that sources must report under other, independent
programs.  While annual emissions data collection activities may not be
"applicable requirements" as defined at 40 CFR 70.2, any such
requirement that meets the definition (e.g., by virtue of being
contained in the SIP or an NSR permit) must be included in the title V
permit and must be complied with by the source.  We agree that any
permit that includes an emissions cap must include specific requirements
for quantifying emissions and determining compliance with the cap and,
therefore, the permitting authority may require any necessary
information on how to compute emissions under the cap to be included in
the permit application.

	We believe that the revised 40 CFR 70.5(c)(3)(iii) will facilitate the
use of advance approvals under emissions caps.  This combination of FAP
tools was repeatedly validated in our evaluation of pilot permits.

Comments on Alternative Operating Scenarios (AOSs)

General Comments on AOSs

Supportive Comments:

One air agency (0064), one federal agency (0099), and three industry
commenters (0068.1, 0071.1, 0075.1) expressed general support for
EPA’s intent to provide greater permitting flexibility through the use
of AOSs, although some also expressed reservations about some aspects of
the proposal as discussed in the succeeding sections of this document.
One of these industry commenters (0068.1) appreciated EPA's clarifying
the meaning and purpose of AOSs and providing specific examples of how
the concept works.  The federal agency (0099) particularly supported the
permitting flexibilities afforded in the proposed revisions involving
AOSs for research and development (R&D) activities.  The commenter
recommended adding "Research and Development" to the list of potentially
affected source categories in order to better recognize the need for
flexible air permitting for R&D facilities.

Opposing Comments:

	Six air agencies (0080.1, 0085.1, 0087, 0089, 0090.2, 0092.1) and five
industry commenters (0072.1, 0074.1, 0076.1, 0077.1, 0083.1) explicitly
opposed EPA’s proposed AOS provisions.  The commenters generally
believe that these revisions are unnecessary and burdensome, and that
they would cause additional confusion.  The six air agencies (0080.1,
0085.1, 0087, 0089, 0090.2, 0092.1) and one industry commenter (0077.1)
stated that the proposed amendments are not likely to improve permitting
efficiency or flexibility because these concepts already exist and are
being used in many state programs to the extent that they are needed.  A
number of the industry commenters indicated that states do not typically
use the existing AOS provisions because they are not needed to assure
compliance.  Four of the industry commenters (0072.1, 0074.1, 0076.1,
0083.1) believe that the revisions would impose redundant recordkeeping
and/or reporting.  One of the air agencies (0087) recommended the
approach that EPA has taken for advance approval, that is, to use the
technique under existing rules and not modify them to accept a
particular format of the advanced approval method the AOS provisions.

	One of the industry commenters (0072.1) who generally opposed the AOS
proposal nevertheless supported EPA’s reminding sources and permitting
authorities that the rules already provide for identification of AOSs
and that those provisions may be used at the source’s option to the
extent the source deems it useful.  However, the commenter was concerned
that EPA’s proposed revisions would force the AOS concept to be
applied much more broadly than it is currently being used.
Specifically, the commenter fears that the revisions might be used to
require sources to carve up all of their applicable requirements into
separate AOSs based on a definition that is subject to varying
interpretations, and that the revisions might be used to impose new
substantive requirements or limitations on those AOSs, contrary to the
limited authority provided permitting officials under title V.

	Another of these industry commenters (0077.1) stated that any final
rule should make clear that AOSs are normally not even necessary for the
typical source but are used in unusual circumstances where a source’s
operations would invoke wholly different and mutually exclusive
requirements that otherwise do not require recordkeeping to show which
rule applies at a given time.

	A third industry commenter (0083.1) stated that revisions to the AOS
provisions are not necessary to implement title V because permits
already are required to include terms addressing all applicable
requirements.  This commenter also strongly disagreed with any
suggestion by EPA that a source would be prohibited from operating
consistent with applicable requirements that are set out in a permit
simply because those requirements had not been identified as an AOS and
“approved” by the permitting authority.  The commenter also
disagreed with any suggestion that title V would allow the permitting
authority to craft new terms and conditions to ensure compliance with
those applicable requirements simply because they were identified as, or
satisfied the definition of, an AOS.  Finally, the commenter disagreed
with the suggestion that permitting authorities could impose new
operational restrictions on a source simply to delineate the scope of an
AOS.  While opposing the proposed revisions for AOSs, the commenter
supported a reminder to sources and permitting authorities that the
rules already provide for identification of AOS and that those
provisions may be used at the source's option to the extent the source
deems it useful.

	One of the opposing air agencies (0080.1) also believes that the
proposed AOS provisions are unnecessary, but added that clarifying
guidance from EPA would ensure that the existing provisions are fully
implemented.  Another of the air agencies (0087) similarly suggested
that EPA prepare a White Paper # 4 to train state regulatory agencies in
the application of these techniques under differing situations.

	One industry commenter (0070.1) did not explicitly oppose the AOS
provisions, but indicated that many of the proposed requirements for
AOSs are unnecessary and burdensome and will discourage AOS use.  In
addition, the commenter stated that some of the situations mentioned in
the proposal where AOSs (or ARMs) can be used are handled today without
using AOSs (or ARMs), for example, a boiler that is permitted to use
both gas and distillate oil.  The commenter believes that states have
the flexibility to permit such common operational alternatives without
using AOSs.

Other General Comments:

One industry commenter (0073.1) expressed confusion about AOSs.  The
commenter indicated that the only circumstance in which an AOS might be
contemplated would be if the source wanted to retain the option for
combusting different fuels in a boiler or heater that it anticipated in
advance in the permit and that different equipment would be operated in
lieu of equipment already permitted.  However, the commenter believes
that this mode of operation can receive an “advance permit approval”
without the inclusion of AOS.

	Without expressing support or opposition, one industry commenter
(0065.1) noted that the basic concept of AOSs is already allowed under
title V.

Response:

Based on the comments received, the states’ current approach to
implementing existing AOS rules has proven to be fundamentally sound and
effective.  We are persuaded that the proposed specific revisions which
would be new requirements would not promote more widespread use of AOSs
and other effective strategies than does the current process-based
approach and that these revisions might instead be counterproductive.
The Agency has therefore decided to not impose any additional
requirements onto an already working approach.  Rather, we intend to
preserve the flexibility available under existing rules by codifying a
definition of “AOS” (as modified in response to comments received)
and promulgating a few minor clarifications to the existing rules
intended to improve certainty.  The Agency believes that these actions,
in light of the comments received, are appropriate and consistent with
the basic streamlining tenets of section 502(b)(6) of the Act on which
the provisions for AOSs are based.

Commenters have convinced us that permitting authorities are currently
able, in response to a request by a source for more operational
flexibility, to develop title V permits which allow the source to shift
among identified operating scenarios.  Commenters correctly point out
that, under the current rule, in lieu of using an AOS, this result might
be achieved by relying on the authority and provisions contained in the
applicable requirements implicated by the anticipated scenario.  This
would be true where the applicable monitoring and/or reporting
requirements assure compliance (including requirements for records that
effectively identify when the scenario operates) or where the source and
permitting authority have opted to streamline the relevant applicable
requirements consistent with White Paper Number 2.  Conversely, AOSs
would be useful where additional records are needed to document when a
new scenario occurs.  We are therefore agreeing with commenters that,
for flexibility purposes, the current process is effective in
developing: (1) appropriate permit design options to access the inherent
flexibility under relevant applicable requirements to provide for
alternative modes of operation; and (2) AOSs which are determined to be
adequate and otherwise appropriate by the permitting authority in
reducing administrative costs while assuring compliance with all
applicable requirements.

Comments on the Definition of AOS

Comment:

	One air agency (0094) and one industry commenter (0068.1) supported the
proposed action to define "alternative operating scenario."  The
industry commenter (0068.1) explicitly supported the proposed definition
of "AOS."

Five industry commenters (0072.1, 0074.1, 0076.1, 0077.1, 0083.1)
opposed adding a definition of "AOS" to the title V regulations.  These
commenters believe that an AOS definition is unnecessary, generally
because they believe that AOSs are not needed and are rarely used.  One
of the commenters (0077.1) stated that adding a definition of "AOS" at
this stage of title V implementation is likely to be more confusing than
helpful and could even call into question the validity of permits that
have been issued containing all applicable requirements, but do not use
AOSs.

	Several commenters took issue with the wording of the proposed
definition, including some of those who opposed including a definition
at all.  Some suggested alternative wording as discussed below.

	Five industry commenters (0063, 0072.1, 0074.1, 0077.1, 0083.1) opposed
inclusion of the phrase “physical or operational change” in the AOS
definition.  These commenters generally believe that this wording is too
similar to language used in other programs (e.g., major NSR) and will
cause confusion.  One of these industry commenters (0063) stated that
the phrase “physical or operational change” could be construed in a
manner that would inappropriately limit the scope of scenarios that
could be covered by an AOS.  The commenter stated that if the phrase
“physical or operational change” remains in the definition of
“AOS,” EPA should explain that it has no NSR implications so long as
the AOS has been appropriately authorized in the Part 70 permit, and
should clearly describe how the phrase “physical or operational
change” establishes boundaries for what activities require an AOS.
Two of these industry commenters (0072.1, 0083.1) do not believe EPA’s
attempt to define an AOS based on whether some activity involves a
“physical or operational change” is useful.  The commenters noted
that at some level almost every change a source makes could be
considered an operational change.  The commenters explained that if
sources are free to interpret their baseline operations (as they do
now), EPA’s proposed revisions would have little impact since sources
themselves would define what constitutes a change.  Another industry
commenter (0077.1) urged EPA to be cautious about concluding that one or
another activity constitutes a physical or operational change as these
terms have meaning in the context of other programs and their meaning
varies depending on the past operation of a given plant, including its
authorizations.  However, if EPA limits the use of AOSs to facilitating
advance approvals (the only situation in which the commenter believes
AOSs can be useful), the commenter stated that EPA could define the term
AOS with respect to a physical or operational change but should add that
such change is being incorporated through a title I approval.

	One of the industry commenters (0063) had additional concerns with the
proposed definition of “AOS” as described below:

The definition does not emphasize the fluidity that is provided by
having multiple authorized AOSs.

The definition of “AOS” is not clear that the use of multiple
compliance options within an applicable requirement does not require an
AOS.  The commenter believes that permitting authorities may often view
"applicable requirement" narrowly as the separate, individual
requirements within a rule or standard (e.g., 95 percent control,
monitoring parameter, recordkeeping requirement, etc.) rather than the
rule or standard in its entirety constituting the applicable
requirement.

The definition of “AOS” should highlight that compliance with a
single set of streamlined applicable requirements per White Paper Number
2 is an option that does not require the use of AOSs.  To the extent
that a Part 70 source has worked with its permitting authority to
streamline the applicable requirements that may apply to an emissions
unit, there is no need for AOS in the permit.

	Based on his concerns, this industry commenter (0063) proposed the
following definition for "AOSs" for EPA’s consideration:

Alternative Operating Scenarios (AOS) – Scenarios in a Part 70 permit
for different modes of operation of an emissions unit, including modes
of operation that may involve authorized physical or operational
changes, when the shift from one mode of operation to another causes the
emissions unit to be subject to a different set of applicable
requirements and the permit does not reflect a single set of streamlined
applicable requirements representing all authorized modes of operation.
An emissions unit may shift between compliance options provided within a
single applicable requirement (e.g., a NESHAP, VOC RACT rule, etc.)
without an AOS.

	One air agency (0069.1) stated that the definition needs to include
language that implies that this authorization either could happen under
separate or combined NSR and title V programs.  In addition, it should
clarify that the AOS may include more than one emissions unit.  The
commenter proposed the following AOS definition:

 Alternative Operating Scenario (AOS) means a scenario authorized in a
part 70 permit that involves a physical or operational change at the
part 70 source for a particular emissions unit or group of emissions
units, and that subjects the unit or group of units to one or more
applicable requirements that differ from those applicable to the
emissions unit or group of emissions units prior to implementation of
the change or renders inapplicable one or more requirements previously
applicable to the emissions unit prior to implementation of the change.
The change, in order to be eligible for an AOS, must be allowable under
all applicable requirements.

	One industry commenter who believes the definition should be deleted
(0074.1) stated that, if it is retained, it should be revised as
follows:

Alternative operating scenario (AOS) means a scenario authorized in a
part 70 permit where an activity that involves a physical or operational
 change at in at the part 70 source for a particular emissions unit, and
that subjects the unit to one or more applicable requirements that
differ from those applicable to the emissions unit previously prior to
implementation of the change or renders inapplicable one or more
requirements previously applicable to the emissions unit prior to
implementation of the change.

	Another industry commenter (0096) stated that EPA should revise the
definition to clarify that switches from one compliance option to
another are not to treated as AOSs, specifically by adding the following
proviso at the end:

; provided, however, that switching from one compliance option to
another under terms established under federal or state regulations or
construction or operating permits and advance approvals for new units or
changes to existing units authorized under construction permits shall
not be treated as AOSs .

Response:

Overall, adding a definition is consistent with preserving current
practices as affirmed by commenters.  The Agency believes that the term
“AOS” should be defined and used consistently in the regulations.
The final definition reads as follows:

Alternative operating scenario (AOS) means a scenario authorized in a
part 70 permit that involves a change at the part 70 source for a
particular emissions unit, and that either results in the unit being
subject to one or more applicable requirements which differ from those
applicable to the emissions unit prior to implementation of the change
or renders inapplicable one or more requirements previously applicable
to the emissions unit prior to implementation of the change.

The final definition is different from the proposed definition in that
we no longer define an AOS as involving a “physical or operational
change.”  We agree with the commenters that inclusion of the phrase
“physical or operational change” invites confusion with the major
NSR provisions.

 The deletion of this phrase also helps to clarify the interface between
the concepts of advance approvals (e.g., advance approval of minor NSR)
and AOSs.  We recognized, based on our evaluation of pilot permits, that
potentially many states could currently advance approve minor NSR and
then incorporate the terms of the authorizing minor NSR permit into the
title V permit as applicable requirements.  While not proposing to do
so, the Agency nonetheless took comment on whether some aspects of such
advance approvals might also involve AOSs.  Commenters strongly affirmed
the current abilities of states to authorize advance approvals of minor
NSR and that these authorizations should be kept generally separate and
distinct from AOSs.  The EPA agrees with these commenters and finds that
the deletion of the phrase is useful in maintaining this separation.
The deletion of the phrase “physical or operational” is also
consistent with our previously stated decision to preserve the scope and
operation of the current rule regarding AOSs.  The existing process to
establish an AOS in a title V permit also addresses any potential
concerns that too many AOSs might be proposed, including, for example,
those involving a switch from one compliance option to another as
provided for under a MACT (or other) standard.  We do not believe that
the population of AOSs actually approved will be impacted by the
deletion.  First, the deletion just preserves the status quo.  Moreover,
sources and permitting authorities are unlikely to establish alternative
MACT compliance options as one or more AOSs, since the extensive
monitoring and recordkeeping requirements typically found in MACT
standards can themselves authorize shifts in compliance options after
being incorporated into a title V permit.  Thus, we do not believe it is
necessary to specify in the AOS definition that AOSs are not necessary
for switches among compliance options.

We agree with the commenters who pointed out that streamlining of
applicable requirements per White Paper Number 2 can obviate the need
for AOSs in the title V permit.  As pointed out above in footnote 1, a
source relying upon emissions limit streamlining implicitly has chosen
not to pursue the use of AOSs, since the source would always be required
to meet the worst-case scenario at all times regardless of which
scenario was actually operated.  Nevertheless, we do not believe it
appropriate to specify this fact in the AOS definition.

Comments on Proposed Uses of AOSs

Comments on Switching Between Compliance Options

Comment:

	One air agency (0069.1) and 14 industry commenters (0063, 0068.1,
0069.1, 0070.1, 0072.1, 0073.1, 0074.1, 0075.1, 0076.1, 0077.1, 0079,
0082, 0084, 0096) supported EPA’s proposal that a source should be
able to switch between compliance options within a given applicable
requirement (if allowed to do so under that applicable requirement)
without viewing this as an AOS.  Some of the commenters explained that
these compliance option changes do not constitute a “physical or
operation change” and therefore do not require an AOS.

Two of these industry commenters (0073.1, 0079) stated that under the
respective applicable requirements, information on the method of
compliance already is collected and reported in semi-annual monitoring
reports and compliance certifications making additional AOS logs
unnecessary.

	Another of these industry commenters (0084) suggested, as another
option, that some state title V permitting programs list only the
current compliance option in the title V permit; in such cases changes
to an alternate approved compliance option should be allowed by noting
the change in the next periodic report.  The commenter stated that such
change should be recognized by the regulatory agency as an
administrative change vs. an AOS.  The commenter also suggested that EPA
include examples in the preamble to the final rule which show how a
switch from one compliance option to another can be characterized as
allowable under an existing permit.

	Two industry commenters (0076.1, 0077.1) agreed with EPA that the
various compliance options in duly promulgated MACT standards do not
constitute alternative operating scenarios.  The commenters stated that
requiring compliance options in MACT standards to be explicated in title
V permits as alternative operating scenarios is also inappropriate
because it adds unneeded length to the title V permit, and that title V
permits have already become unduly lengthy.

Response:

	Under the final rule, MACT (or other standards) compliance options
could represent different AOSs, but are unlikely to be designated as
such.  As mentioned in the last response, AOSs must first be proposed by
the source and then not rejected by the permitting authority.  As a
practical matter, based on the comments received, few sources are likely
to propose AOSs for switching among well-defined compliance options.
Moreover, few permitting authorities are likely to find them necessary.

	We do not believe, in general, that MACT compliance options beyond
those initially incorporated into the title V permit can, upon their
future implementation, be merely noted in the next periodic report and
then added administratively to the permit.  Instead, subsequently
implemented compliance options should be added through the appropriate
permit revisions process which can vary depending on the significance of
the change.  In order to minimize future permit revisions, the source
and the permitting authority can expand the number of permitted option
to include both ones which are currently used and those which are
reasonably anticipated to be used during the term of the title V
permit.

Comment:

	One air agency (0069.1) commented on language in the proposal preamble
that the permit should include the allowed compliance options “that a
source may reasonably anticipate using during the term of the permit.”
 The commenter found that this practice minimizes the need for permit
amendments, but noted that requests are received from permittees to
include all possible options, even if they intend to only use one of two
of them.  The commenter stated that this approach adds significantly to
the time needed to draft the permit and makes it more difficult to use
as a compliance tool.

	One industry commenter (0074.1) stated that EPA should clarify that
compliance and monitoring options in rules are part of the applicable
requirements to be included in a title V permit if the source requests
them and cannot be eliminated at the discretion of the permitting
authority.  The commenter stated that nothing in the statute or the
rules indicates that states should have authority to remove compliance
options from sources or to erect hurdles to their implementation through
the title V program.

	Another industry commenter (0082) stated that including all
possible/potential compliance options in permit application information
is burdensome and not necessary.

Response:

	Permitting authorities need not accept those proposed compliance
options which are not reasonably anticipated to occur.  However,
permitting authorities are encouraged to err on the side of inclusion
where the source believes that an alternative compliance approach could
reasonably occur and that its incorporation into the permit is not
burdensome.

Comments on the Relationship Between AOSs and Advance Approvals

	Two industry commenters (0084, 0096) supported EPA's proposal to
distinguish AOSs from all advance approvals, including those involving
the addition of new units.  One of these commenters (0084) supported
existing state permitting programs that already included advance
approval mechanisms that are analogous to the AOSs which EPA is
proposing.  The commenter also generally supported EPA’s statements in
the preamble that, in some cases, an AOS is not needed to supplement an
advance approval; and in some cases, EPA’s proposal for construction
and operation of a new unit authorized in advance may not necessarily be
an AOS.

	One air agency (0094) and one industry commenter (0079) stated that new
unit additions should not be characterized as AOSs.  Another air agency
(0069.1) and another industry commenter (0070.1) concurred with the
proposal preamble discussion indicating that an advance approval of a
new emissions unit does not require an AOS unless the particular unit,
once operational, requires the flexibility to make subsequent changes
that will cause different applicable requirements to apply.  The latter
two commenters also believe that an AOS should not be required for an
advance approved change to an existing emissions unit unless the change
is reversible.  One of the air agencies (0069.1) stated that requiring
non-reversible authorizations to be viewed as AOSs would add needless
complexity to the permit requirements.  The other air agency (0094),
however, supported using an AOS for an advance approved change to an
existing emissions unit, regardless of whether the change is reversible.

	Three industry commenters (0074.1, 0076.1, 0077.1) who believe that
AOSs are generally unnecessary (for advance approvals or any other use)
indicated that the one situation where AOSs might potentially be useful
is to reflect the point at which a source implements an advance approved
change on a permanent basis.  The commenters stated that whether an AOS
should be under such circumstances should be worked out by the source
and permitting authority on a case-by-case basis.  Two of the commenters
(0076.1, 0077.1) noted that the NSR permit likely would include
appropriate notification requirements, but construction permits vary in
their content and an AOS could be used to ensure that appropriate
records are kept.

Response:

The EPA agrees with commenters that affirmed the current abilities of
states to authorize advance approvals of minor NSR and that these
authorizations should be kept generally separate and distinct from AOSs
and finds that the deletion of the phrase "physical or operational
change" is useful in maintaining this separation.  Thus, in most cases,
advance approval of minor NSR is simply another example of how the
inherent flexibility in an applicable requirement can be accessed
without the need for an AOS.  See footnote 2 above for more on this
topic.

Comments on Revisions for Consistent AOS Terminology

Comment:

	One industry commenter (0068.1) explicitly supported the proposed
revisions to make the AOS provisions more consistent by using the same
terminology uniformly throughout the regulations.

Response:

	The EPA agrees and has promulgated revisions to implement this
approach.

Comments on Revisions to Application Requirements for AOSs

Comment:

	One industry commenter (0059) stated that the proposed rule improves
AOS provisions, specifically by clarifying the kinds of changes that
qualify and identifying information that needs to be provided with
renewal applications to satisfy title V permitting requirements.

	One industry commenter (0084) stated that prescriptive rule changes are
not needed in order to define the minimum elements for an AOS
application.  The commenter noted that existing state title V programs
and regulations require facilities to comply with all applicable
requirements by the compliance date.  Because Part 70 programs vary from
state to state, the commenter believes that each state permitting agency
should define the necessary elements of a permit application in order to
establish an AOS.  The commenter also agreed that permit applications
should include sufficient detail to properly describe the AOS.  The
commenter added that the detail should be sufficient that the permitting
authority understands the concept of the described AOS, and noted that
it should be the decision of the permitting authority in determining
whether additional information is needed to further describe the AOS in
the application or conditions of the permit.

	Another industry commenter (0070.1) stated that per the proposal, AOS
applications must include the SIC code, a description of each unit
involved and emission rates in TPY for each unit (except where operating
under a cap), terms necessary to determine an appropriate reference test
method, the anticipated changes and applicable requirements for each, an
explanation as to how the source will comply with those requirements, a
description of the baseline operating scenario, and a certification
demonstrating the source has obtained necessary authorizations; and a
compliance schedule.  The commenter believes that these new
requirements should be streamlined substantially so that sources can
reasonably apply for, and obtain, an AOS.

Response:

	In finalizing the FAP rule, EPA has decided to finalize the proposed
revisions to the permit application requirements of 40 CFR 70.5 and
71.5.  The specific provisions, along with specific comments on them,
are discussed in the sections that follow.

	We note that the last commenter's list of information required in the
application for AOSs includes a number of items that are already
required under the existing rules.  These items were included in the
proposed regulatory language when other changes were made to the
existing paragraphs containing them.  The commenter's list also includes
a number of items that were proposed to be added to the required permit
content for AOSs in 40 CFR 70.6(a)(9)(iii) and 71.6(a)(9)(iii).  These
additions have not been finalized, as discussed in Section 4.6.4 of this
document below.

Comments on the Clarification of the Types of Additional Information
that May Be Requested on AOSs [§70.5(c)(7)]

Comment:

	One industry commenter (0084) who opposed adding to the application
requirements for AOSs stated that it should be the decision of the
permitting authority in determining whether additional information is
needed to further describe the AOS in the application or conditions of
the permit.

Response:

The Agency has decided to finalize the proposed revisions to 40 CFR
70.5(c)(7) to clarify that the permitting authority shall require the
source to include in its application additional information as necessary
to define permit terms and conditions to implement any AOS.  Where the
final version obligates the permitting authority to require, as
contained in the proposal, additional information to develop and
implement AOSs, we believe this requirement only extends to situations
where the permitting authority believes such information is necessary.
We believe that this obligation has always been implicit in the
previously existing language of the section, but that an explicit
clarification is appropriate.

Comments on Requirements for Documentation of Necessary Authorizations
[§70.5(c)(7)]

Comment:

	One industry commenter (0070.1) stated that EPA's proposed revisions to
40 CFR 70.5(c)(7) seem unnecessary, because the permit authority is the
same authority that would authorize an AOS, and the agency would
certainly know whether or not advance approvals needed for the AOS have
been authorized.  The commenter stated that EPA provided no explanation
for the requirement of additional documentation and the facts do not
support this additional burden.

Response:

We are finalizing our proposed revisions to 40 CFR 70.5(c)(7) to specify
that the application must include a demonstration that the source has
obtained all authorizations required under the applicable requirements
that apply to any AOS being requested for approval by the source, or a
certification that the source has submitted a complete application for
such authorizations.  This action just codifies existing policy and
should be manageable given the relatively few AOSs that may also involve
an advance approval (e.g., the preconstruction approval of a new unit
requiring AOSs for its multiple future operating modes or for its
involvement as a replacement component unit in an AOS for an existing
emissions unit at the same source).  This clarification will also help
to ensure that any additional resources required for AOS development are
focused on sources which are likely to use them and to eliminate any
confusion over a provision proposed without such authorizations.

Comments on Requirement for Compliance Plans [§70.5(c)(8)]

Comment:

	One industry commenter (0096) supported EPA’s revisions to 40 CFR
70.5(c) that provide for information to be included in permit
applications regarding AOSs, including the compliance plan provisions
that provide for a statement to be included in the application that the
source will meet applicable requirements associated with an AOS on a
timely basis.

	One industry commenter (0084) who opposed adding to the application
requirements for AOSs nevertheless agreed that a statement should be
included in the application that the source will meet the applicable
requirements upon implementation of the AOS.

	One industry commenter (0063) found the proposed compliance plan
provisions related to AOS to be unnecessary because circumstances are
suitably covered by 40 CFR 70.5(c)(8)(ii)(A) and (B) and
70.5(c)(8)(iii)(A) and (B).  The commenter stated that there is no need
to add the proposed special provisions for AOS that would likely require
permitting authorities to amend their regulations and permit application
forms unnecessarily.

Response:

We are finalizing our proposed revisions to the compliance plan
requirements for applications under 40 CFR 70.5(c)(8) to clarify that
such plans must address AOSs when an application includes them.  We
believe that this clarification merely codifies existing policy and is
appropriate to ensure that all applicants understand what is required
for AOSs when a source chooses to request one.  Based on comments
received, we believe that most states can implement this requirement
without additional rulemaking.

Comments on Revisions to Permit Content Requirements for AOSs (§70.6)

Comments on Semiannual Reports [§70.6(a)(3)(iii)(A)]

Comment:

	Five industry commenters (0068.1, 0071.1 0073.1, 0077.1, 0096) opposed
the proposal to require a source to submit a periodic report of all the
changes the source made under its AOSs.  Several of the commenters
stated that these additional reporting requirements will provide little
information and will not tell the permitting authority anything about
“compliance” with the applicable requirement.

	One of these industry commenters (0068.1) noted that the permit will
identify the applicable requirements for any scenario under an AOS, the
source must report on deviations from any permit conditions, including
AOS, and the source will provide a compliance certification with respect
to all permit conditions, including AOS.  As a result, the commenter
believes that a report of all the changes under an AOS provides little
meaningful information to the state permitting authority.  The commenter
added that if an agency would like to know more details about the
changes that occurred during a reporting period, it can request the
source to submit the log of AOS changes that the source is already
required to maintain.  Similarly, another of these industry commenters
(0077.1) stated if a particular source requires additional reporting
based on factors unique to that source, the state can include that as a
separate requirement for the semi-annual report.

	One industry commenter (0071.1) believes that if the proposal expands
these reporting requirements it will be not beneficial to the refining
and petrochemical industries.  Another of these industry commenters
(0096) stated that such changes are not deviations and thus are not
properly addressed in deviation reports.  The commenter added that the
log is itself sufficient.

Response:

	Based on comments received, the Agency is persuaded that the new
reporting requirements, as proposed for inclusion in the 6-month
monitoring report, would not be necessary or useful.  We generally
believe that sufficient information about AOSs and their use already
exists from the combination of the AOS provisions contained in the
permit and the required reports concerning annual compliance
certification and the prompt reporting of deviations from achieving
compliance with the AOS terms of the permit.  In addition, pursuant to
40 CFR 70.6(a)(9)(i), permits must require the source to keep an on-site
log that contemporaneously records the implementation of any AOS which
occurred during the duration of the title V permit.  Pursuant to 40 CFR
70.6(a)(3)(ii)(B), the source owner must keep these records at their
site for at least 5 years.  Under 40 CFR 70.6(a)(6)(v) the source must
submit to the permitting authority, upon their request, this and any
other on-site information which is required to be kept by the permit or
is needed by the permitting authority to determine compliance with the
permit.

Comments on Log Content [§70.6(a)(9)(i)]

Comments:

	Seven industry commenters (0063, 0070.1, 0071.1, 0073.1, 0079, 0084,
0096) opposed EPA’s proposal to include expanding information required
to be kept in logs (40 CFR 70(c)(9)(i)).  These commenters generally
believe some of the information EPA proposes to require is unnecessary
and overly burdensome.

	One of these industry commenters (0063) questioned the value added by
including the applicable requirements and permit conditions in the log
even in the form of a cross-reference to the permit.  The commenter
noted that the source generally will not rely on the log to ensure
compliance; in addition, for inspection and enforcement purposes, the
permitting authority will ultimately rely on the permit itself and not
the log to determine what requirements apply under any given AOS.
Therefore, the commenter suggested EPA delete the requirement to
maintain in the log “the applicable requirements and other permit
terms and conditions that apply to the AOS”.  If this requirement is
maintained, the commenter believes it should be revised to make clear
that it is acceptable to merely reference the permit.  Another of these
industry commenters (0073.1) stated that failure to comply with an
applicable requirement would already be reported in the deviation report
and annual compliance report, therefore, repetition of all of the
information in the log is excessive, unnecessary, and burdensome for
operating sources and regulators.  This commenter also believes the
proposed regulation is ambiguous regarding whether cross referencing is
allowed for AOS in permits and in logs.  The commenter suggested that
the final rule clearly allow the use of cross referencing to the permit
in the case of logs for AOS, and to other applicable requirements in the
permit itself.

	Two of these industry commenters (0073.1, 0079) stated that requiring
recordation of more information in a log could confuse the operator.
One of these industry commenters (0073.1) urged EPA not to revise the
log requirements for AOS, or to simplify the information required.  The
commenter stated that the relevant information should be the emissions
unit, its operating mode, and what pollution control device (if
required) is operating.  Another industry commenter (0079) stated
relevant information is that controls are in place at the time of a
shift in operating scenario.  The commenter stated it is not necessary
to repeat the applicable requirement or even cross reference the permit
if the log book headings are correct.

	Two of these industry commenters (0084, 0096) stated that in most
instances it will only be necessary that the source indicate the date it
began to operate the AOS.  Accordingly, the commenters stated that EPA
should not require that the log include a description of the change that
triggered the AOS, the emissions units included in the AOS, and the
applicable requirements and other permit terms and conditions that apply
to the AOS.  The commenters also stated that typically, it also will not
be necessary for there to be a description of the change or the
emissions units involved in order for compliance with the AOS to be
determined.  These industry commenters (0084, 0096) stated that the
first sentence of the provisions, "to record in a log at the permitted
facility a record of the AOS under which it is operating,” is
sufficient.  The commenters stated that EPA should delete the following
sentence which prescribes information to be included in the log that
goes beyond what is necessary for determining compliance with applicable
requirements.  The commenters also stated that if, however, EPA feels
that any provision should be established beyond the simple requirement
to record in a log the AOS under which a source is operating, it should
simply add language to the first sentence as follows: ", including the
date the source began to operate the AOS."

Another of these industry commenters (0070.1) stated that all of the
proposed requirements would already be spelled out in the permit, except
for the current requirement to log when the change to the AOS is made.
The commenter stated that the benefit of adding this repetitive
information to a log is not identified and it should not be required.
The commenter added that EPA should require the log entry to reference
the permit conditions for the AOS.

	Another of these industry commenters (0071.1) believes that, if the
proposal expands these recordkeeping requirements, it will be not
beneficial to the refining and petrochemical industries.

Response:

	The Agency agrees with commenters that there is no need to standardize
the content of AOS logs provisions.  While not finalizing any specific
content or format requirements for logs involving AOSs, the Agency notes
that there remains an overall obligation that the information which is
required by the permitting authority for AOSs must be adequate to assure
compliance with all applicable requirements.  Thus, the structure of the
AOS implementation log required by the permitting authority is
relatively flexible, provided that the required records are, in total,
sufficient to verify the requirements applicable to a particular
operating scenario and whether the source was in compliance with them.

Comments on Permit Shields for AOSs [§70.6(a)(9)(ii)]

Comment:

	One industry commenter (0096) supported EPA’s proposed revision to 40
CFR 70.6(a)(9)(ii) that provides for a permit shield to be authorized
for terms and conditions under AOSs .

Response:

	We note that the existing 40 CFR 70.6(a)(9)(ii) and 71.6(a)(9)(ii)
provide that the permitting authority may provide the permit shield to
AOSs.  Our only revision to this paragraph of the rules is to use
consistent terminology, i.e., to refer to "each such AOS."  We are
finalizing this rule revision.

Comments on Permit Content to Describe AOSs [§70.6(a)(9)(iii)]

Comment:

One industry commenter (0096) supported EPA’s revision to 40 CFR 70.6
providing for incorporation of permit terms that properly describe the
AOS.

Another industry commenter (0070.1) believes that the proposed new
requirements for AOSs should be streamlined substantially so that
sources can reasonably apply for, and obtain, an AOS.  Among the
provisions that the commenter believes are too burdensome are the
requirements to describe the baseline operating scenario, the
anticipated changes and applicable requirements for each, and the
measures the source will use to comply with those requirements.

Response:

	As discussed in Section 4.1 of this document, numerous air agencies
(0080.1, 0085.1, 0087, 0089, 0090.2, 0092.1) opposed the AOS proposal in
general as being unnecessary and likely to reduce, rather than expand,
the flexibility available under the existing rules.  Although these
commenters did not specifically refer to the permit content portion of
the AOS proposal (or most other specifics of the proposal), we believe
that this is one aspect of the proposal that was targeted as unnecessary
and potentially restrictive.  In response to these comments, the Agency
has decided that there is no need to standardize the permit provisions.
While not finalizing any specific content or format requirements for
permits involving AOSs, the Agency notes that there remains an overall
obligation that the information which is required by the permitting
authority for AOSs must be adequate to assure compliance with all
applicable requirements.

Comments on Requirement for All Needed Authorization [§70.6(a)(9)(iii)]

Comment:

	One air agency (0094) and one industry commenter (0096) supported the
clarification that NSR approval is necessary prior to incorporation of
an AOS into the title V permit.

	One air agency (0069.1) stated that permit applications for AOS for
combined title V/NSR programs such as Minnesota’s require that these
applications contain the needed information for the pre-construction
authorization as well as the information to meet the title V permit
content requirements.  The commenter stated that rule language that is
inclusive of this scenario would be useful to avoid confusion and
conflict between what states require and what is listed in this rule.
The commenter suggested that 40 CFR 70.6(a)(9) [and 40 CFR 70.5(c)(7)]
be amended to reflect the available option of combined programs.

Response:

	In general, we are finalizing revisions to 40 CFR 70.6(a)(9)(iii) to
make clear that the permitting authority cannot grant final approval of
an AOS until the source has obtained all the authorizations required
under the applicable requirements relevant to that AOS.  These actions
just codify existing policy and should be manageable given the
relatively few AOSs that may also involve an advance approval (e.g., the
preconstruction approval of a new unit requiring AOSs for its multiple
future operating modes or for its involvement as a replacement component
unit in an AOS for an existing emissions unit at the same source).  This
clarification will also help to ensure that any additional resources
required for AOS development are focused on sources which are likely to
use them and to eliminate any confusion over a provision approved
without such authorizations.

	The Agency did not propose any specific provisions regarding combined
programs and, thus, is not finalizing any.  We continue to believe that
states with combined programs are best able to design provisions to
implement their specific approach.

Other Comments on AOSs

Comment:

	One industry commenter (0073.1) urged EPA to repeat in the final
notice, the information on the off-permit provisions of part 70
contained in footnote 22 of the proposal.  Another industry commenter
(0075.1) similarly supported EPA's statement in footnote 22 regarding
off-permit changes that "failure to anticipate and include a particular
change under an AOS does not in and of itself bar the source from
implementing the change" if it can be done using the off-permit
provisions.  However, the commenter believes that EPA should provide
further clarification of the definition of "off-permit" so that the
scope of this statement is clear.  One air agency (0094) thanked EPA for
including the discussion of the off-permit provisions in footnote 22 of
the proposal preamble.

Response:

	The EPA has reaffirmed the substantive content of footnote 22 in the
proposal by inclusion of footnote 19 in the preamble to the final rule.

Comment:

	Four industry commenters (0074.1, 0076.1, 0077.1, 0084) noted that
there is some discussion in the preamble to the proposed rule regarding
the need for AOS to contain sufficient monitoring to assure compliance.
These commenters requested that EPA clarify in the final rule that the
use of AOSs does not create a new authorization for states to supplement
the monitoring in existing rules, and that any action to add monitoring
must be consistent with EPA’s interpretation of 40 CFR 70.6(a)(3) and
70.6(c)(1) that applicable requirements which already contain periodic
monitoring are not to be supplemented in the title V permitting process.
 One of these industry commenters (0077.1) pointed out that only where
there is no periodic monitoring in the underlying applicable requirement
do the part 70 rules provide any authority for adding monitoring in the
title V issuance process.  The commenter requested that EPA clarify in
the final rule that the discussion in this rule does not change that
interpretation.

Response:

	Where a permit contains an AOS, it must also contain monitoring,
recordkeeping and reporting requirements for periods when the source is
operating under that scenario that are consistent with the requirements
of title V and part 70 (in the same manner as for the baseline
scenario).  In addition, the Agency believes that 40 CFR 70.6(a)(9)
requires the permitting authority to augment existing applicable
monitoring requirements (including recordkeeping) as necessary to
establish AOSs to the extent that the applicable monitoring requirements
are insufficient to determine what operating scenario and applicable
requirements are in effect at any particular time.

Comment:

	One air agency (0089) and three industry commenters (0070.1, 0073.1,
0079) disagreed with the concept that EPA should prioritize
implementation assistance for flexible permitting to companies that have
opted into EPA’s Performance Track program.  The commenters believe
that flexible permitting should be a mainstream practice available to
all types of sources.

Response:

	The Agency has decided to delete this topic from the rulemaking.  We
intend to provide support to a potentially wide spectrum of states and
sources which might request assistance.

Comment:

One industry commenter (0096) supported EPA’s revised provisions in
40 CFR 70.4(d)(3)(xi) which provide that state programs "must include
provisions to ensure that AOSs requested by the source and approved by
the permitting authority are included in the part 70 permit . . . ."

Response:

	This change was not a substantive one but one intended primarily to
assure consistent use of the AOS terminology.  This revision also adds
"and approved by the permitting authority," again for purposes of rule
consistency.

Comment:

	One industry commenter (0063) noted that “baseline scenario” is not
a defined term, nor does it appear to be used in the rule, however, it
is used in the preamble discussion.  The commenter stated that its
description may be appropriate under certain circumstances, however,
when emissions units switch between AOS more frequently, the baseline
scenario should not be determined by chance, i.e., by what AOS the unit
happens to be operating at the moment the permit is issued.  The
commenter stated that under those circumstances, a baseline scenario
would be more appropriately characterized as the scenario that reflects
the predominant operation of the emissions unit and the corresponding
applicable requirements.

Response:

	The final rules, like the proposal, do not define the term "baseline
scenario."  The permitting authority and source are therefore free to
define it for a particular situation if they choose to do so.  In any
event, the permitting authority must define any accepted AOS in the
permit.

Comment:

	One industry commenter (0084) suggested EPA allow and support continued
state agency flexibility in the AOS approvals.  A proposal would be for
EPA to provide special grants (e.g. matching funds not required) to fund
program implementation.

Response:

	The preamble to the final rule conveys EPA's intent to support FAP
implementation potentially in several ways (e.g., a website, workshops,
an EPA network of contacts).  While we have no particular plans to use
the grant mechanism at this time, we will consider it as well as other
possible forms of implementation support as the particular situation
warrants.  Note also that states may charge more for flexible permits to
the extent that they are more costly to develop.

Comment:

	One industry commenter (0075.1), while generally supporting the
proposed AOS rules, believes that the rules would not provide the
intended flexibility and will have limited utility because it will be
very difficult for applicants to identify and adequately describe all
possible AOSs and all associated applicable requirements at the time the
title V application that contains the AOSs is submitted.  The commenter
proposed that EPA revise all appropriate provisions of the proposed AOS
rules to require that the title V application that contains the AOSs
identifies and adequately describes all AOSs that are known or can be
reasonably anticipated at the time the title V application is submitted,
and identifies all applicable requirements associated with those AOSs,
but that the AOS rules would allow the permittee to operate under an AOS
that is not identified in the title V application, provided that (i)
within a specified period of time, the permittee submits to the agency a
notification that identifies and adequately describes the new AOS and
identifies all associated applicable requirements, and (ii) the
permittee has obtained all necessary NSR authorizations for the new AOS.

Response:

	We do not believe that AOSs are appropriate for operating scenarios
that are not reasonably anticipated at the time of permitting.  Based on
pilot experience and the comments received, AOSs are not often needed
since applicable requirements frequently contain sufficient
documentation to determine which requirement(s) apply at all times and
to assure compliance with each one.  The situation described by the
commenter also could be addressed by a permit revision or by off-permit
procedures, where available and applicable to the particular situation.

Comments on Approved Replicable Methodologies (ARMs)

General Comments on ARMs

Comments Supporting ARMs:

Two air agencies (0064, 0069.1) and eight industry commenters (0070.1,
0072.1, 0074.1, 0076.1, 0077.1, 0083.1, 0084, 0096) generally supported
the ARM concept.  Several of these commenters predicated their support
on the understanding that ARMs are voluntary on the part of sources.
Three of the industry commenters (0074.1, 0076.1, 0096) provided general
support for the proposed ARM rule revisions as well, and one additional
industry commenter (0084) stated that it did not object to EPA’s
proposed definition, but it did not explicitly support it.

One of the industry commenters (0074.1) stated that the proposal
regarding ARMs was helpful because it provides a national statement
regarding how permits can and should be written to minimize the costs of
the program, provide flexibility to industry, and develop permit terms
that assure compliance.  Another of these industry commenters (0076.1)
stated that this proposed definition will help the title V program
function more smoothly.  Another of these industry commenters (0084)
agreed that states must have sufficient authority to grant ARMs (and
AOSs) if proposed by a source.  The commenter stated that the permitting
authority should have control independent of EPA when deciding the
appropriateness of the alternative methodology.  Another of the industry
commenters (0096) further noted that a number of air quality standards,
including MACT standards, have included approved replicable
methodologies for determining applicable compliance obligations, making
the ARM requirements consistent with continuing to authorize such
revisions where appropriate for assuring reasonable ongoing compliance
obligations.

One air agency (0069.1), and four industry commenters (0072.1, 0076.1,
0077.1, 0083.1) pointed that permitting authorities have already used
such approaches for many years.  Most of the commenters stated that
EPA’s endorsement of this approach is helpful in explaining how these
approaches are beneficial, and could help make its application more
routine.  Several of the commenters also stated that the use of ARMs has
significant potential to reduce the number of permit revisions required
in title V permits.

One of the industry commenters (0077.1) opposed the proposed 6-month
reporting requirement for ARMs.  The commenter stated that no special
reporting is warranted for ARMs because an ARM is simply a method for
showing compliance.  The commenter added that hundreds of permits have
been issued with ARMs without any special reporting requirements.

Comments Opposing ARMs:

	Six air agencies (0080.1, 0081, 0085.1, 0087, 0089, 0090.2) opposed
EPA’s proposed ARM rule revisions.  Five of the air agencies (0080.1,
0085.1, 0087, 0089, 0090.2) stated that the proposed amendments are not
likely to improve permitting efficiency or flexibility because these
concepts already exist and are being used in many state programs.  The
commenters believe that state and local clean air agencies already have
the authority and tools needed to issue flexible title V permits.  The
proposed ARM (and AOS) provisions will unnecessarily complicate an
already complex title V program, resulting in delays and frustrations
for both sources and permitting authorities.  One air agency (0087)
recommended that EPA use the approach it has taken for advanced approval
projects, that is, to implement ARMs under existing rules and not modify
the rules to specify a particular format for the ARM provisions.

Comments on Further Regulatory Language:

	In response to our request for comment on whether regulatory revisions
beyond those proposed are needed for ARMs, one air agency (0069.1) who
supported EPA’s ARM proposal indicated that further rule changes are
not needed to encourage the use of ARMs.  One industry commenter (0084)
who supported the ARM proposal believes that there is a need for more
clarification of how the ARMs can be used as an efficient permitting
technique, including additional preamble language.  Both the air agency
(0069.1) and the industry commenter (0084) suggested EPA provide
additional examples that EPA has approved so that state agencies and EPA
can have a common understanding when utilizing this approach.

Response:

In response to these commenters, EPA has decided to finalize the
proposed definition with minor changes and to add certain additional
clarifications to 40 CFR 70.6(a)(1).  In doing so, we reaffirm the
proposal, but have made more explicit in the final rule certain
safeguards concerning the use of ARMs.  For example, §70.6(a)(1)
requires that no ARM shall contravene any terms needed to comply with
any otherwise applicable requirement or part 70 requirement or
circumvent any applicable requirement that would apply as a result of
implementing the ARM.  See section 5.2 below for more discussion of the
commenters' concerns that prompted us to add this safeguard to the final
rule.

We agree that states currently have authority to issue ARMs in title V
permits; however, we do not agree that placing a definition for ARM in
our part 70 rules will stifle innovation by the states.  On the
contrary, we believe that finalizing the ARM definition will clarify the
availability of this aid to flexible permitting to those states and
sources that are not aware of it or have had prior issues concerning its
use.

	The final definition is nearly identical to the one proposed (i.e., we
added a minor clarification that the results of the ARM be recorded as
well as used for assuring compliance with any applicable requirement or
requirement of part 70).  The final definition reads as follows:

Approved replicable methodology (ARM) means part 70 permit terms that:

	(1)  Specify a protocol which is consistent with and implements an
applicable requirement, or requirement of this part, such that the
protocol is based on sound scientific and/or mathematical principles and
provides reproducible results using the same inputs; and

	(2)  Require the results of that protocol to be recorded and used for
assuring compliance with such applicable requirement, any other
applicable requirement implicated by implementation of the ARM, or
requirement of this part, including where an ARM is used for determining
applicability of a specific requirement to a particular change.

We wish to emphasize that under the final definition, an ARM may be used
as a means to determine the applicability of a requirement, not just as
an aid for assuring compliance.  The EPA has included other ARM-like
mechanisms in several of our national standards for MACT and NSPS.  If a
source proposes an ARM to delineate which changes are subject to one
requirement instead of another, examples should be provided to the
permitting authority and to the record supporting proposed approval of
the ARM illustrating the prospective use of the ARM (if approved).  We
believe that the permitting process is the best forum for clarifying how
a proposed ARM would work in the relevant situations reasonably expected
to occur over the duration of the permit.  However, in the case where
the permitting authority has significant concerns over how an
applicability ARM would operate in certain situations, the permitting
authority should not authorize the ARM for those situations.

	We are also revising 40 CFR 70.6(a)(1) to acknowledge that  ARMs may be
considered as one type of part 70 permit term that assures compliance
with applicable requirements.  We are also adding two clarifications
that appropriately focus ARM implementation.  The Agency believes that
these clarifications in combination with the mentioned final definition
will promote increased consideration of ARMs, where appropriate.  The
revised 40 CFR 70.6(a)(1) reads as follows:

§70.6  Permit content.

	(a)   * * *

	(1)  Emissions limitations and standards, including those operational
requirements and limitations that assure compliance with all applicable
requirements at the time of permit issuance.  Such requirements and
limitations may include ARMs identified by the source in its part 70
permit application as approved by the permitting authority, provided
that no ARM shall contravene any terms needed to comply with any
otherwise applicable requirement or requirement of this part or
circumvent any applicable requirement that would apply as a result of
implementing the ARM.

	This final version of 40 CFR 70.6(a)(1) incorporates existing policy
that a source must first request an ARM in its part 70 permit
application before it can be considered by the permitting authority.
Note that this request could appear as part of the originally submitted
application or in the later submittal of supplemental application
material (e.g., a letter requesting consideration of a replicable
protocol as an ARM).  As is the case for AOSs, the permitting authority
must then decide whether to accept the proposed ARM and may reject it or
modify it for several appropriate reasons, including concerns over its
replicability and/or value in lowering administrative costs.  This
addition is consistent with the basic process required for the
establishment of AOSs which, based on comments received, is effective in
ensuring that FAP approaches are appropriately considered.

	Relevant to the first element of the final “ARM” definition,
sources will identify candidate protocols that if judged to be
replicable could be considered further as a potential ARM by the
permitting authority.  Candidates for such protocols would frequently
arise from already established applicable requirements, such as MACT
standards, NSPS, or preconstruction permits (e.g., minor or major NSR).
If accepted by the permitting authority as an ARM, pursuant to the
second element of the final definition, the part 70 permit would contain
the ARM (i.e., the combination of the replicable protocol and the
instructions for its use, including the type of data to be inputted).

	As summarized above, no commenters specifically supported our proposed
reporting requirement for ARMs, and one commenter specifically opposed
the reporting requirement.  In addition, numerous states opposed the ARM
proposal in general as being unnecessary and likely to reduce, rather
than expand, the flexibility available under the existing rules.
Although these commenters did not specifically refer to the reporting
portion of the ARM proposal (or most other specifics of the proposal),
we believe that this is one aspect of the proposal that was targeted as
unnecessary and potentially restrictive.  Finally, as discussed
previously in Section 4.6.1 of this document, several commenters raised
concerns regarding our similar proposal to require reporting of AOSs in
the 6-month monitoring report which we believe are also appropriate to
consider in deciding whether to require the 6-month reporting of ARMs.
As a result, we have concluded that the information contained in the
permit about the nature of any approved ARM and the instructions for its
use along with the required reports concerning annual compliance
certification and the prompt reporting of deviations from achieving
compliance with the ARM should generally be sufficient.  In addition,
sources must keep on-site records of ARM implementation.  Moreover, any
required on-site records must be submitted to the permitting authority
upon request pursuant to 40 CFR 70.6(a)(6)(v).  Therefore, we have
decided to drop the proposed requirement for the 6-month monitoring
report to identify any ARMs implemented during the reporting period.

Comments on the Use of ARMs to Adjust Operating Parameter Limits

Comment Opposing ARMs for this Purpose:

	Five air agencies (0065.1, 0080.1, 0081, 0085.1, 0089) opposed EPA’s
concept that use of an ARM can avoid a permit revision when a new
compliance test results in a change to the operating parameter which is
monitored for compliance assurance.  The commenters stated the use of
ARMs may allow changes to operating parameters that will result in
increases in actual emissions that should trigger NSR.  Several of these
commenters stated changes in operating parameters cause violations to
several aspects of the Act such as PSD/NSR, NAAQS, and title V, and
specifically to the court's decision in New York v. EPA, 413 F.3d 3
(D.C. Cir. 2005) since the plain language of the CAA indicates that
Congress intended to apply NSR to physical or operational changes that
increase actual emissions.  The commenters stated since NSR is triggered
by changes to physical or operating parameters that increase actual
emissions, a change in operating parameters from those currently in the
permit cannot be allowed without a minor or major NSR permit, as
applicable.  One of these commenters (0089) is also troubled that
EPA’s codification of ARMs may lead to operating procedures that
deviate from the original permit conditions without the permitting
authority’s knowledge or approval—leading to widespread problems in
achieving the goals of SIP planning.  One of these air agencies (0065.1)
believes this would be contrary to the existing requirements of title V
that provides that a “significant change in existing monitoring terms
or conditions” shall be considered a “significant” permit revision
subject to full public review.

	Another of the air agencies (0081) listed the following additional
arguments as to why the commenter believes that EPA’s proposal to
include ARMs as permit terms in operating permits would violate the
Clean Air Act:

Because section 504(f) of the Act provides for “permit shields”
whereby compliance with a permit issued under title V of the Act is
deemed compliance with section 502 of the Act, 42 U.S.C.  7661a, a
permittee in compliance with a permit that incorporates an ARM could
escape compliance with applicable requirements of the Act but still be
protected by a “permit shield.”  Therefore, by including an ARM in a
permit, a source could inappropriately circumvent other requirements of
the act.

Under the proposal, sources would no longer have to provide the detailed
information in operating permit applications that is currently required
under 40 CFR 70.5(c).

Comments Supporting ARMs for this Purpose:

Five industry commenters (0072.1, 0073.1, 0074.1, 0076.1, 0079, 0083.1)
stated that if a rule or permit requires a source to establish an
operating parameter range or limit during performance testing, the title
V permit is sufficient as long as it incorporates the requirement to
establish the limit and to comply with it when it is established.  The
commenters added that the permit itself is not required to reflect the
actual limit established during an individual test, or to be revised to
reflect changes in that limit during subsequent testing.  Several of the
commenters indicated that many states issue permits that reference
values established through performance testing or another described
methodology as indicators of performance.  One of the commenters
(0074.1) noted that such approaches minimize the need for permit
revisions while still providing transparency in terms of how compliance
is determined.

Response:

	As noted above, we have finalized ARMs nearly as proposed.  However, we
have added a clarification in 40 CFR 70.6(a)(1) in response to those
commenters who were concerned that ARM implementation of one applicable
requirement might circumvent the applicability of another applicable
requirement.  We believe that this final clarification adequately and
appropriately conveys that an ARM created under part 70 to streamline
the implementation of one applicable requirement cannot be used to
contravene compliance with another requirement under the Act or to
circumvent its applicability as a result of implementing an ARM.
Accordingly, the terms of an NSR permit, which are applicable
requirements that must be incorporated into a title V permit, cannot
subsequently be changed using an ARM created under different authority.
Approved replicable methodologies can be used to update values only when
the applicable requirement allows for this to occur.  For example, if an
existing NSR permit includes specific parametric monitoring levels as
compliance indicators, to automate the updating of such levels the NSR
permit would need to be revised to establish an ARM – the title V
process could not create an ARM to revise the NSR conditions directly.
Similarly, the potential applicability of other requirements implicated
by the implementation of an ARM (e.g., NSR) must be independently
evaluated and determined.

Comments on Compliance Assurance Monitoring (CAM):

	Two air agencies (0085.1, 0089) stated that the application of ARMs
runs counter to the CAM requirements under 40 CFR part 64 which requires
the establishment of performance indicators for applicable control
devices as a means of ensuring their proper operation for compliance
purposes.  One of these commenters (0085.1) stated that it is unclear
how a permitting authority would handle a situation where an ARM results
in a parameter change outside of the range established by CAM.  The
commenter added that should the proposed rule be adopted, there is
potential for duplicative and conflicting monitoring requirements.  Two
of these commenters (0089, 0093.1) stated that the goals of ARMs and CAM
do not appear to mesh, with ARM monitoring aimed at effectuating changes
that may increase actual emissions without permit revisions, and CAM
aimed at correcting control devices that are not functioning properly so
that emissions are minimized consistent with the control technology
being used and there is an adequate compliance margin.  The commenter is
also concerned that EPA is layering another monitoring procedure on top
of CAM procedures and the pending Periodic Monitoring rule without
considering that complexity, duplication, and conflicts among monitoring
requirements and methods may ensue.

Response:

	Commenters are mistaken that the application of ARMs runs counter to
the CAM rule requirements under 40 CFR part 64.  The CAM rule, at 40 CFR
64.4(a)(2), first endorsed the concept from which ARMs developed by
allowing CAM submissions to specify "… the process by which such
indicator ranges or designated conditions shall be established …."
While it is possible for permitting authorities to maintain separate
approaches for the CAM rule and for ARMs, it is not a requirement.
Sources may request and permitting authorities may allow use of an ARM
to satisfy a CAM rule requirement.  Under such approval, which could be
accomplished via title V permit streamlining [see 40 CFR
70.6(a)(3)(i)(A)], sources relying on an ARM would have data
determinative of compliance, since ARM development requires correlation
of measurements with emissions.  The CAM rule requirements would accept
this type of correlation, but the majority of subject sources choose to
provide "reasonable assurance of compliance" with emissions limits by
focusing on proper emissions control device operation, rather than a
strict correlation between measurements and emissions.  In cases where a
source and permitting authority maintain separate CAM and ARM
requirements, should a parameter value occur outside the range included
in the CAM plan, but within the range established by the ARM, then the
source would need to continue to comply with the response to excursions
or exceedances requirements of 40 CFR 64.7(d) and the source may choose
to re-establish the indicator ranges via a title V permit modification
[see 40 CFR 64.7(e)].  Of course, in cases where a source and permitting
authority use an ARM to satisfy the CAM rule and a parameter value
occurs outside the range established for the ARM, then the source would
need to demonstrate its emissions at the parameter value, and either
expand the ARM range (if emissions were within limits) or report
noncompliance with emissions limits.

Comment:

One air agency (0069.1) addressed the issue of whether or not monitoring
parameters can be determined and/or revised after permit issuance
without the permit being amended through a process involving a public
notice in Minnesota’s Part 70 Program.  Minnesota was required to
commit to determining and revising such parameters using a public
noticed permit amendment even though stack testing rules approved in the
Minnesota SIP allow for this authorization without a major permit
amendment.  The commenter stated that this rule proposal deviates from
this approach, but the preamble implies that the ARM approach is
technically allowed under the current rule and that the rule proposal is
only a clarification.  The commenter requested that EPA address this
inconsistency in EPA position in any final rule making so that there is
clear direction on this issue.

The same air agency (0069.1) stated that the preamble discusses how the
ARM replaces the specific parameter in the permit – it suggests
putting the ARM in the permit instead of a specific value (e.g.,
temperature, pressure drop, emissions factor, etc.).  The commenter
stated from its experience, the state of Minnesota typically puts the
ARM in the permit as well as the current value.  For example, the ARM
for revising and updating emissions factors appears in the permit, but
an appendix to the permit lists all of the factors that were approved as
of permit issuance.  The permit is generated by a multi functional
database that is used for permitting, inspections, tracking of testing,
etc.  Ideally, the system is used to actually keep track of the current
approved value.  If a value is changed via an ARM, the commenter
believes the value can be updated in the permit (and the database) via
an administrative amendment (reopening) or at the next permit amendment.
 The commenter prefers to not delete the value entirely from the permit.
 The commenter requested EPA clarify whether or not the agency can
continue to use this approach under the proposed revisions or whether
the ARM concept prohibits any value from appearing anywhere in the
permit.

Response:

	In general, ARMs, where proposed by a source and approved by the
permitting authority, can update monitoring parameters used to assure
compliance with an applicable requirement contained in the part 70
permit (e.g., an emissions standard).  If, however, the operating
parameter level itself is an applicable requirement on the face of the
part 70 permit (e.g., because the limit appeared as a term of a minor
NSR permit which was incorporated into the source's part 70 permit), an
ARM may only be used to revise the parameter level without permit
revision where the ARM and the expectation and procedure for its use are
also set out in the same applicable requirement (e.g., as other terms of
the same minor NSR permit).  The permit would require the source to
comply with each new value of the parameter resulting from
implementation of the ARM, and could require attachment to the permit of
each new value without revising the permit.  Note that this potential
use of an ARM, the limitations on such use, and the consequences of a
changed level must be specifically considered and approved by the
permitting authority in reviewing the potential ARM to ensure that the
ARM does not contravene or circumvent any other applicable requirement.
Where the parameter limit is contained in a minor NSR permit, this
review would occur in both the applicable NSR and part 70 processes.

	The situation described by the commenter appears to involve a part 70
permit that contains both the ARM and the current value of a given
parameter used to determine compliance (e.g., temperature, pressure
drop, emissions factor, etc.).  Under this approach, the permit must be
modified to incorporate new values.  If the commenter does not believe
that the approach described in the preceding paragraph is appropriate
for their situation (i.e., using an ARM to update and attach new
parameter levels without revising the permit), then the commenter should
contact EPA to determine how best to revise the permit in order to
incorporate each new parameter level.

Other Comments on ARMs

Comment:

	One industry commenter (0084) suggested that EPA clarify in the final
rule that existing title V permit or state minor NSR terms and
conditions can be treated as ARMs provided they satisfy the proposed
definition in 40 CFR 70.2.  The commenter also agreed that ARMs can be
part of the title V permitting process as described in 40 CFR
70.6(a)(3), however, it should be left to the discretion of the
permitting authority to determine whether the permit needs to contain
additional streamlined monitoring or gap-filling periodic monitoring
requirements for a particular source.  The commenter also understood the
proposal so that ARMs are used in conjunction with AOSs.  Therefore, the
commenter stated that ARM concept as proposed could also be satisfied by
either state minor NSR or title V permitting programs.

Response:

	We agree that existing permit terms from existing part 70 permits and
state minor NSR permits can contain replicable protocols which can then
be established as ARMs in a part 70 permit, provided the appropriate
instructions for recordkeeping and ARM use are also incorporated into
the permit.  Permitting authorities can also consider allowing the
applicable protocol to function like an ARM prior to its incorporation
into the part 70 permit.  Depending on the applicable SIP-approved minor
NSR regulations, one or more replicable protocols with appropriate
requirements for their use might bridge the time from source
construction to its initial operation.

Comment:

	One industry commenter (0074.1) sought clarification from EPA that, in
the future, ARMs (and AOSs) will not be required when existing permit
terms, including permit streamlining and worst case conditions, can be
drafted to ensure compliance with the applicable requirements.

Response:

	We agree with the commenter that streamlining of applicable
requirements (per White Paper Number 2) can obviate the need for an ARM
(or an AOS) in the title V permit.  Specifically, in cases where an ARM
could be used to determine which applicable requirement is currently
applicable to an emissions unit, streamlined requirements would make the
ARM (or the AOS) unnecessary because a source relying upon a streamlined
emissions limit would always be required to meet the worst-case, most
stringent applicable requirement at all times regardless of which
applicable requirement actually applied.

Comment:

	One air agency (0069.1) stated that EPA should clarify whether or not
the term “Approved Replicable Methodology” must be specifically
defined in the state program in order for this concept to be implemented
if states believe their current rules are adequate.

Response:

	Because the final rules represent clarifications to the existing part
70 regulations, we believe that many states will be able to implement
the final rules without revising their regulations.  This belief is
further based on the pilot experience and on the comments received from
states who affirmed that their current authority was sufficient to
implement ARMs (i.e. no state rulemaking was thought to be needed to
incorporate the new definitions and clarified requirements).

	Nevertheless,  states may choose to send us specific revisions to their
current programs at any time.  There is no mandate for part 70 programs
to contain provisions specific to ARMs.  Thus, states are not obligated
to revise their part 70 programs in this regard as a result of the final
rule.  However, optional rule changes may be useful to some states in
implementing the final rule more effectively and to achieve the
anticipated administrative benefits attributed to ARM implementation.

Comment:

	Referring to the proposed ARM provisions, one air agency (0094)
supported EPA's efforts to expand "administrative amendments" to cover
routine changes to the title V permit.  The commenter asserted that
providing public review of the process that will occur is certainly much
better than having to provide notice of each change that has followed
the same process.

Response:

	We agree that incorporating an ARM into the title V permit provides for
public review of the process that will occur, which gives the public an
adequate understanding of how the source will operate in the future.
However, we would not characterize this as the use of an "administrative
amendment," which has specific meaning and governing provisions as set
out in 40 CFR 70.7(d).  Administrative amendments are a means to revise
the title V permit.  As previously discussed, an ARM is used to provide
flexibility by precluding the need for a permit revision.

Comment:

	One industry commenter (0077.1) requested that EPA clarify the preamble
discussion regarding the interpretations of the “assure compliance”
language at 72 FR 52222 where we discussed the legal basis for ARMs.
The commenter noted that contrary to what is there-implied, title V does
not provide authority for states or EPA to impose operational
requirements in any way that would change the applicable requirement or
make it more stringent.

Response:

	Under the terms of the final rule, an ARM, by definition, must be
consistent with and must implement an applicable requirement or
requirement of part 70.  As is generally true for other terms and
conditions of a title V permit, ARMs must assure compliance with
applicable requirements but do not alter those requirements.

Comments on Green Groups

Overall Summary of Comments and EPA's Final Action

Comment:

	The commenters, while mixed in their overall reaction to the Green
Group concept, generally did not support the specifics of the Green
Group proposal.  State commenters indicated that the proposed
10-to-15-year term of the Green Group is inappropriate because the Act
and good environmental stewardship require BACT/LAER reviews and air
quality analyses to be conducted contemporaneously with the time of each
change at a facility.  These commenters disagreed with our assertion
that BACT and LAER typically do not advance significantly over the
proposed 10- or 15-year period.  They added that such permits would
unfairly reserve PSD increments for projects that might never be built
and that the air quality status in the area of a Green Group could also
change due to, for example, transported pollution, revisions to the
NAAQS, and natural events.  State commenters also questioned the
environmental benefits of Green Groups and did not believe that the
pilot permits contained in the docket supported the Green Group
approach.  They also asserted that Green Groups share the legal flaws of
Clean Units.  State commenters further conveyed that many permitting
authorities already offer considerable flexibility and that it is the
permitting authorities who can best decide the structure of their own
programs in this regard.  The state commenters generally believe that
the Green Group proposal should be abandoned, but if it is finalized it
should be a voluntary element of the major NSR program, rather than
mandatory as proposed.

	The environmental group that commented on the proposal asserted that
the proposed 10-to-15-year term of the Green Group is inconsistent with
the Act’s requirements for contemporaneous BACT/LAER and air quality
reviews.  The environmental group also indicated that Green Groups
suffer from the same legal flaws as Clean Units.  Like most state
commenters, the environmental group believes that the Green Group
proposal should be abandoned, but if it is finalized it should be
voluntary for the states.

	Industry commenters, on the other hand, typically favored some aspects
of the proposal and believe the Green Group to be a real incentive for
sources to control beyond their legal requirements in exchange for
greater regulatory certainty.  These commenters often argued that a term
of 10 to 15 years would be necessary to justify the expenditure for
state-of-the-art controls for a Green Group.  They agreed with the
proposal that Green Groups should be a mandatory element of the major
NSR program and attributed real benefits such as those associated with
lower administrative costs.  They believe that Green Groups are legally
defensible and clearly different from Clean Units.  However, industry
commenters asserted that the proposal did not reflect how manufacturing
facilities are constructed and operated.  In particular, they stated
Green Groups should not be limited to a single control device and that
pollution prevention should be allowed as the primary Green Group
control approach.  In addition, they indicated that the proposed
monitoring, recordkeeping, and reporting requirements are unnecessarily
detailed and prescriptive.

Response:

	Primarily for certain policy reasons raised by commenters and based on
our belief that the current major NSR regulations already provide
considerable flexibility to states, EPA has decided to withdraw our
proposal on Green Groups.  As described below, the Agency will consider
initiating another rulemaking related to flexibility under the major NSR
regulations if new data become available after additional field
experience that supports such an approach.  Any such rulemaking would be
an entirely new rulemaking, separate and distinct from the Green Group
proposal being withdrawn in this action.

	Notwithstanding our withdrawal of the Green Group proposal, we wish to
note that certain statements we made in support of the proposal are not
affected by the Green Group withdrawal.  First, the requirements of 40
CFR 51.165(a)(5)(ii), 51.166(r)(2), and 52.21(r)(4) are met when an
emissions unit with emissions limits previously taken to avoid major NSR
subsequently undergoes major NSR review.  Next, we continue to believe
that a longer-term major NSR project is clearly different from a Clean
Unit and may be defended on that basis.  Construction of the later
portions of an approved major NSR project is simply “building out”
out the permit as authorized and does not rely on an allowables
emissions test.  Finally, pursuant to 40 CFR 52.21(b)(3)(iii), and to
analogous provisions in 40 CFR 51.166(b)(3)(iii) and
51.165(a)(1)(vi)(C)(2), emissions increases and decreases that occur as
authorized in a major NSR permit qualify as having been “relied upon
by the permitting authority” in issuing a major NSR permit.  As such,
these emissions changes are not to be included in the future netting
calculations at the same source during the time that the NSR permit
would be effective.

	Our decision to withdraw the Green Group proposal is in large part
based on the significant new information and policy perspectives
conveyed in certain comments received on this proposal.  Based on the
varying types of concerns raised by commenters, EPA no longer believes
that promulgation of the Green Group approach – which was EPA’s
effort to develop a single, nationally uniform approach for Green Groups
to achieving advance approval under major NSR – is appropriate.  While
an approach like that proposed for Green Groups might be effective in
certain situations, several commenters pointed out serious reservations
about initial air quality and technology reviews becoming stale over the
10-year life of a Green Group.  Others were concerned that the proposed
Green Group approach was not flexible enough to encompass already tested
approaches involving emissions units serviced by multiple control
approaches.  These commenters also persuaded the Agency that a
mandatory, one-size-fits-all approach under the major NSR rules could be
counterproductive as well as too inflexible.  Many of the same
commenters believed that national rules requiring a specific template
for Green Groups across all states could instead stifle future
innovation and flexibility while adding complexity and unnecessary
administrative burden.

	The Agency is also not finalizing our proposal on Green Groups because