reducing PM concentrations,'' and cite several studies in support of
this argument.\117\ The commenters further state that reducing ammonia
emissions may be achieved through ``strategies such as improving
livestock feed to reduce excreted nutrients, altering manure storage
and handling practices to prevent [ammonia] emissions, and improving
synthetic fertilizer use efficiency,'' again citing numerous
studies.\118\ The commenters

argue that the EPA ``should reject the plan's BACM analysis for failing
to justify these weaker controls, and for being inconsistent with the
Title VI prohibition against policies and practices that inflict
disparate impacts.''
---------------------------------------------------------------------------

    \116\ Public Justice Comment Letter, 20.
    \117\ Public Justice Comment Letter, 16, Exhibits 31 through 34.
    \118\ Public Justice Comment Letter, 17, Exhibits 35 through 40
and three additional studies: N. Cole, et al., ``Influence of
dietary crude protein concentration and source on potential ammonia
emissions from beef cattle manure,'' J. Anim. Sci. 83, 722, 2005; N.
Cole, P. Defoor, M. Galyean, G. Duff, J. Gleghorn, ``Effects of
phase-feeding of crude protein on performance, carcass
characteristics, serum urea nitrogen concentrations, and manure
nitrogen of finishing beef steers,'' J. Anim. Sci. 12, 3421-3432,
2006; and R. Todd, N. Cole, R. Clark, ``Reducing crude protein in
beef cattle diet reduces ammonia emissions from artificial feedyard
surfaces,'' J. Environ. Qual. 35, 404-411, 2006.
---------------------------------------------------------------------------

c. The EPA's Reconsidered Proposal
    As a result of our proposed conclusion that ammonia remains a
regulated precursor for the 2012 annual PM2.5 NAAQS in the
SJV, the EPA has evaluated potential ammonia emissions control measures
for the two most substantial source categories in the SJV and evaluated
whether the State has implemented ammonia controls with a BACM/BACT
level of stringency. Thus, the EPA has also evaluated the existing
control measures that the State claims are BACM for two of the main
sources of ammonia in the area, including confined animal facilities
(CAFs) and fertilizer application.\119\ As discussed below, we conclude
that the SJV has not established that it has enforceable requirements
in the SIP that meet a BACM level of stringency to reduce ammonia
emissions from these two categories. Therefore, we propose to
disapprove BACM for ammonia sources in the SJV.
---------------------------------------------------------------------------

    \119\ By focusing on these two source categories, the EPA is not
indicating that this is an exhaustive list of ammonia source
categories that must be evaluated for BACM. However, because these
two categories amount to more than 90% of the ammonia emissions in
the SJV, we focus our analysis on these two categories.
---------------------------------------------------------------------------

    Our basis for proposing to disapprove BACM for ammonia sources
flows from the controls analysis we have reviewed and discuss in
section II.A.3 of this proposed rule. We agree with the commenters that
the analysis of potential controls in the 2018 PM2.5 Plan
was weak in two general areas: (1) incomplete quantification of
existing ammonia emission reductions, and (2) lack of consideration of
potential ammonia control measures identified in research studies. In
that section we describe the Plan's weaknesses with respect to
quantifying emission reductions and rely on that description for
purposes of evaluating BACM.
    Similarly, in section II.A.3, we discuss additional options for
ammonia control that we will not reiterate here. Based on our review of
the additional research studies cited by the commenters with respect to
CAFs, measures such as those for adjusting the protein content of
livestock feed (e.g., reducing the portion of beef cattle finishing
diets by 1.5% steam-flaked corn), manure handling and storage (e.g.,
washing dairy cow collecting yards after each milking event, covering
solid manure stores with sheeting), and land application of slurry
(e.g., injection application techniques), it appears that additional
measures may be available to evaluate. Absent a thorough and more
current evaluation of technological and economic feasibility of
potential measures as applied in the SJV, we propose to find that the
State has not demonstrated whether or how additional measures (e.g., in
the form of existing options that could also be feasibly implemented,
or new options that may lead to increased reductions) may have been
evaluated, implemented (even partially) by the existing rules, or set
aside for reasons of technological feasibility or economic feasibility,
consistent with the BACM requirements.
    For fertilizer application, as discussed in section II.A.3 of this
proposed rule, the District indicates that it does not have authority
to regulate ammonia emissions from fertilizer application. Regardless
of which State entity, as a matter of State law, has authority over
this class of activities, CAA section 189(b)(1) requires that the State
include provisions to ensure implementation of BACM for direct
PM2.5 and plan precursor emissions, and CAA section
110(a)(2)(E)(i) requires the State to provide necessary assurances that
it has adequate authority to carry out the implementation plan for the
area. While the Plan describes certain water-related measures (e.g.,
Nutrient Management Plans and Nitrogen Management Plan) that subject
agricultural operators, including dairies, bovine feedlots, poultry
operations, and crop farmers to waste discharge requirements, and
likely limit ammonia emissions to the air, to our knowledge, these
regulations do not impose any enforceable requirement for ammonia
emissions to the air, and thus suffer a similar problem as Rule
4570.\120\
---------------------------------------------------------------------------

    \120\ Unlike Rule 4570, which has been approved into the
California SIP to limit VOC emissions, the State's water-related
regulations on fertilizer application have not been submitted for
approval into the California SIP.
---------------------------------------------------------------------------

    We agree that as a general matter, managing the amount of nitrogen
applied to the environment should reduce the potential for pollution to
air, water, and land. However, the 2018 PM2.5 Plan does not
quantify or otherwise substantiate the scale and timing of such
potential ammonia emission reduction benefits, nor their
enforceability. We propose that the State has not adequately identified
potential control measures, evaluated for BACM/BACT, nor demonstrated
the implementation of BACM/BACT for controlling ammonia emissions from
fertilizer application, the second largest source of such emissions in
the SJV.
    As a result of our proposal that the State has not demonstrated
that BACM/BACT controls are in place for CAFs and fertilizer
application, two source categories that make up more than 90% of the
ammonia emissions in the SJV, we propose to disapprove the State's BACM
demonstration for ammonia sources.
3. BACM for Building Heating Emission Sources
a. Summary of 2021 Proposed Rule
    In our 2021 Proposed Rule, the EPA summarized the State's
submission in the 2018 PM2.5 Plan for the SJV and presented
our BACM evaluation for emission sources of direct PM2.5 and
NOX.\121\ We briefly summarize those components here with
respect to the State's BACM demonstration for building heating emission
sources, such as water heaters and space heaters (e.g., furnaces), in
the SJV.
---------------------------------------------------------------------------

    \121\ 86 FR 74310, 74324-74325.
---------------------------------------------------------------------------

    In Appendix C of the 2018 PM2.5 Plan, the District
identifies the stationary and area sources of direct PM2.5
and NOX in the SJV that are subject to District emission
control measures and provides its evaluation of these regulations for
compliance with BACM requirements. As part of its process for
identifying candidate BACM, the District reviewed the EPA's guidance
documents on BACM, additional guidance documents on control measures
for direct PM2.5 and NOX emission sources, and
control measures implemented in other ozone and PM2.5
nonattainment areas in California and other states.\122\ Based on these
analyses, the District concludes that all best available control
measures for stationary and area sources are in place in the SJV for
NOX and directly emitted PM2.5 for purposes of
meeting the BACM/BACT requirement for the 2012 annual PM2.5
NAAQS.
---------------------------------------------------------------------------

    \122\ 2018 PM2.5 Plan, Ch. 4, section 4.3.1.
---------------------------------------------------------------------------

    With respect to building heating emission sources, the District
presents its evaluations of Rule 4902 (``Residential Water Heaters'')
and Rule 4905 (``Natural Gas-Fired, Fan-Type Central Furnaces'') in
sections C.20 and C.21, respectively, of Appendix C of the 2018
PM2.5 Plan. Both rules are point of sale rules that limit
what kinds of residential water heaters and furnaces may be sold in the
SJV. The District describes the types of equipment covered by each
rule, compares the specific provisions of each rule that

limit NOX emissions \123\ to comparable rules in other
California air districts, and concludes that each rule represents BACM
for their respective source category.
---------------------------------------------------------------------------

    \123\ The District notes that equipment subject to Rule 4902 are
fired on natural gas that meets California Public Utility Commission
standards and, therefore, emit only low amounts of SOX
and direct PM2.5. 2018 PM2.5 Plan, App. C, C-
288.
---------------------------------------------------------------------------

    Rule 4902 applies to natural gas-fired, residential water heaters
with heat input rates less than or equal to 75,000 British thermal
units per hour (Btu/hr). The District tightened the rule's
NOX limits in 2009; and the EPA approved the rule into the
SIP in 2010.\124\ The District estimates that, due to Rule 4902, annual
average emissions of NOX would decrease from 2.15 tpd in
2013 to 1.91 tpd in 2025 (0.24 tpd decrease) and annual average
emissions of direct PM2.5 would increase from 0.21 tpd in
2013 to 0.23 tpd in 2025 (0.02 tpd increase).\125\
---------------------------------------------------------------------------

    \124\ 75 FR 24408 (May 5, 2010).
    \125\ 2018 PM2.5 Plan, App. C, C-283.
---------------------------------------------------------------------------

    In addition to comparing the NOX limits in its Rule 4902
to rules in other California air districts, the District also presents
a multi-factor comparison of natural gas-fired and propane-fired, water
heaters to electric water heaters.\126\ The District discussed the
likely impacts of requiring electric water heaters, including the
advantages such as no NOX emissions,\127\ less expensive
purchase price, and smaller size, and the disadvantages such as higher
cost of electricity, and the costs of residence modifications to
convert to electric. Based on 2017-2018 data, which is consistent with
the timing of Plan adoption in 2018, the District calculated emission
reductions and cost effectiveness of the three kinds of water heaters
by fuel type and concluded that ``[w]hile the lifetime cost of an
electric water heater is higher than that of propane and natural gas,
the emissions benefits may make converting to electric water heating a
viable control strategy.'' \128\ The analysis does not explore the cost
effectiveness of such controls and Rule 4902 does not include any
requirements regarding electrification.
---------------------------------------------------------------------------

    \126\ 2018 PM2.5 Plan, App. C, C-288 to C-289.
    \127\ The EPA notes that while the NOX emissions of
electric water heaters and furnaces are zero, there could be an
increase in NOX emissions from electric power plants.
    \128\ 2018 PM2.5 Plan, App. C, C-289.
---------------------------------------------------------------------------

    Rule 4905 applies to natural gas-fired, fan-type central furnaces
with heat input rates less than 175,000 Btu/hr and combination heating
and cooling units with a rated cooling capacity of less than 65,000
Btu/hr. In 2015, the District tightened the rule's NOX
limits for residential units and expanded the rule to include
commercial units and manufactured homes according to a phase-in
schedule. The EPA approved the rule into the SIP in 2016.\129\ The
District estimates that, due to Rule 4905, annual average emissions for
NOX will decrease from 2.44 tpd in 2013 to 2.13 tpd in 2025
(0.31 tpd decrease) and annual average emissions for direct
PM2.5 will increase from 0.20 tpd in 2013 to 0.22 tpd in
2025 (0.02 tpd increase).\130\ Given the need to extend certain
compliance deadlines in subsequent amendments to Rule 4905 due to
limited supply of certified compliant units,\131\ the District states
that it had identified no additional emission reduction measures for
this source category as of that point in time.\132\
---------------------------------------------------------------------------

    \129\ 81 FR 17390 (March 29, 2016).
    \130\ 2018 PM2.5 Plan, App. C, C-290.
    \131\ The District further amended Rule 4902 in 2018, 2020, and
2021 to extend the compliance deadline for specific units due to
limited supply of certified compliant units, with each amendment
applying to a smaller subset of those specific units. See, e.g., San
Joaquin Valley UAPCD, ``Item Number 10: Adopt Proposed Amendments to
Rule 4905 (Natural Gas-Fired, Fan-Type Central Furnaces),'' December
16, 2021, 2-3.
    \132\ 2018 PM2.5 Plan, App. C, C-293. Unlike the
District's consideration of electric water heaters, the District did
not present an evaluation of electric furnaces in its analysis of
Rule 4905.
---------------------------------------------------------------------------

    As noted in the EPA's 2021 Proposed Rule, we provided our
evaluation of the District's BACM demonstration for stationary and area
sources in general, and several source categories in more detail, in
three documents: (1) section III of the EPA's ``Technical Support
Document, EPA Evaluation, San Joaquin Valley Serious Area Plan for the
2012 Annual PM2.5 NAAQS,'' December 2021 (``EPA's 2012
Annual PM2.5 TSD''); (2) the EPA's ``Technical Support
Document, EPA Evaluation of BACM/MSM, San Joaquin Valley
PM2.5 Plan for the 2006 PM2.5 NAAQS,'' February
2020 (``EPA's BACM/MSM TSD''); and (3) the EPA's ``Response to Comments
Document for the EPA's Final Action on the San Joaquin Valley Serious
Area Plan for the 2006 PM2.5 NAAQS,'' June 2020 (``EPA's
2020 Response to Comments''). In particular, the EPA's 2020 Response to
Comments presented our evaluation of the District's BACM demonstration
for residential water heaters and residential and commercial, natural
gas-fired, fan-type central furnaces.\133\ At that time we found that
the requirements for residential fuel combustion covered by Rule 4902
and Rule 4905 represented BACM.\134\ In addition, the EPA concluded
that setting a zero-NOX standard for heating appliances in
new buildings reasonably requires additional consideration and analysis
of technological and economic feasibility by the District because, per
the 2018 PM2.5 Plan, the most common types of residential
water heaters and furnaces are those that use natural gas as fuel.
---------------------------------------------------------------------------

    \133\ EPA's 2020 Response to Comments, Comment 6.O and Response
6.O, 142-148.
    \134\ EPA's 2020 Response to Comments, 146-147.
---------------------------------------------------------------------------

    We also noted that the building codes referenced by commenters at
that time appear to be green building code ordinances that restrict or
prohibit installation of natural gas or propane appliances in new
construction.\135\ Such ordinances, most of which appeared to have been
adopted in late 2019 and early 2020, fell within a category known as
``reach codes,'' which are city and county building code standards for
energy efficiency that exceed California's State-wide standards. We
stated that California law requires local governments to submit
proposed ordinances to the California Energy Commission (CEC) for a
determination that they will be both cost effective and more energy
efficient than statewide standards; compliance with this procedure is
necessary for such measures to be enforceable.\136\ We also noted that
ordinances adopted by city councils and county officials are legally
distinct from measures adopted by the governing boards of the
respective air districts and that it did not appear at the time that
California air districts had adopted similar restrictions.
---------------------------------------------------------------------------

    \135\ EPA's 2020 Response to Comments, 147-148.
    \136\ California 2019 Building Energy Standards, at California
Code of Regulations (CCR), Title 24, Part 1, Article 1, Sec. 10-106
(``Locally Adopted Energy Standards''); see also https://ww2.energy.ca.gov/title24/2016standards/ordinances.
---------------------------------------------------------------------------

b. Summary of Adverse Comments
    Public Justice states that further emission controls are available
for building heating via the electrification of furnaces, water
heaters, and other gas-fired appliances.\137\ The commenters refer to
comments submitted by a group of environmental, public health, and
community organizations (collectively referred to herein as ``NPCA'')
on the EPA's proposed rule on the 2006 24-hour PM2.5 NAAQS
portion of the SJV PM2.5 Plan,\138\ noting that building
electrification requirements to reduce emissions from such sources
already

exist in over 30 jurisdictions in California and other states. The
commenters state that, since that time, additional jurisdictions have
moved forward with gas bans, appliance standards, and other strategies
for building heating.\139\
---------------------------------------------------------------------------

    \137\ Public Justice Comment Letter, 19.
    \138\ Comment letter dated and received April 27, 2020, from
Mark Rose, NPCA, et al., to Rory Mays, EPA, including Appendices A
through G. The seven environmental and community organizations, in
order of appearance in the letter, are the National Parks
Conservation Association (NPCA), Earthjustice, Central Valley Air
Quality Coalition, Coalition for Clean Air, Central Valley
Environmental Justice Network, The Climate Center, and Central
Valley Asthma Collaborative (collectively ``NPCA'').
    \139\ Public Justice Comment Letter, 19, and Exhibits 41 through
44. Commenters also state that studies suggest these measures may
provide particularly notable benefits to winter PM2.5
peaks in the SJV. Id. at 19.
---------------------------------------------------------------------------

    With respect to the EPA's response to the NPCA comments in
2020,\140\ Public Justice argues that the ``EPA merely asserted that
the District had found increased building electrification infeasible,''
despite the record showing that other jurisdictions required such
measures, and assert that the District noted the potential of such
measures but rejected them without explanation. The commenters further
argue that the EPA did not rebut evidence on the benefits and
feasibility of such measures, instead noting the need for further
consideration, and that two years later, the Plan does not provide
further consideration.
---------------------------------------------------------------------------

    \140\ EPA, ``Response to Comments Document for the EPA's Final
Action on the San Joaquin Valley Serious Area Plan for the 2006
PM2.5 NAAQS,'' June 2020. See Comment 6.O and Response
6.O on pages 142-147.
---------------------------------------------------------------------------

c. The EPA's Reconsidered Proposal
    Based on the adverse comments from Public Justice, the EPA has
reconsidered our proposed approval of the State's demonstration of BACM
for NOX and direct PM2.5 emissions from building
heating appliances, such as residential water heating and residential
and commercial space heating. As discussed below, we now propose to
disapprove the State's BACM demonstration for such building heating
emission sources.
    Although the EPA has previously approved the State's BACM
demonstration for building heating emission sources in 2020 with
respect to the 2006 24-hour PM2.5 NAAQS portion of the 2018
PM2.5 Plan, and such approval was upheld by the Ninth
Circuit Court of Appeals,\141\ several factors have reshaped the facts
and circumstances of controlling emissions from such sources as of 2022
and beyond. First, while building ordinances that restrict or prohibit
installation of natural gas or propane appliances in new construction
were starting to appear in 2019 and 2020, as Public Justice correctly
asserts, two additional years have passed and additional jurisdictions
have adopted gas bans, appliance standards, and other strategies for
building heating.\142\ A recent policy brief published by the UCLA
School of Law states that 52 cities and counties in California have
adopted building codes to reduce their reliance on gas for building
heating appliances, and discusses several examples.\143\ The growth in
the number and types of local control measures to reduce pollution from
building heating by restricting or limiting the use of natural gas-
fired heaters support their general availability as technologically
feasible measures.
---------------------------------------------------------------------------

    \141\ Ninth Circuit Memorandum Order, 9. Regarding increased
building electrification requirements, the Court stated that ``the
EPA considered such an approach and reasonably accepted the State's
determination that it was not feasible at this time.''
    \142\ See Public Justice Comment Letter, Exhibits 41 through 44.
    \143\ Heather Dadashi, Cara Horowitz, and Julia Stein,
``Pritzker Environmental Law and Policy Briefs, How Air Districts
Can End NOX Pollution From Household Appliances,'' Emmett
Institute on Climate Change and the Environment, UCLA School of Law,
March 2022, 8.
---------------------------------------------------------------------------

    Second, the time horizon of the 2012 annual PM2.5 NAAQS
portion of the SJV PM2.5 Plan is one year later (2025
attainment date) than that of the 2006 24-hour PM2.5 NAAQS
portion of the Plan (2024 attainment date), affording additional time
for potential control measures to achieve emission reductions that may
assist attainment of the 2012 annual PM2.5 NAAQS. Even if
full implementation of such new measures is not possible by the
applicable attainment date, the State should evaluate whether they
could be implemented in part, consistent with the fifth step for BACM/
BACT evaluation discussed in the PM2.5 SIP Requirements Rule
and the General Preamble (i.e., to determine the earliest date by which
a control measure or technology can be implemented in whole or in
part).\144\
---------------------------------------------------------------------------

    \144\ 81 FR 58010, 58083-58085.
---------------------------------------------------------------------------

    Third, some of the underlying bases for the District's cost
comparison for residential water heating may have changed since the
District's 2018 adoption of the Plan. For example, in comparing
emission reductions and cost effectiveness of low-NOX
natural gas, propane, and electric water heaters, the District used
data on energy factors and purchase price from Grainger Industrial
Supply as of June 14, 2018, and lifetime energy cost data from the U.S.
Energy Information Administration as of 2017. Furthermore, as claimed
by Public Justice, the District did not explain its rejection of
additional control measures of this type, other than to assert that
they were generally more costly. Regarding residential and commercial
space heating, CARB and the District did not provide a detailed
economic feasibility analysis in the Plan. CARB and the District simply
stated that, due to limited supply of certified compliant natural gas-
fired units to comply with Rule 4905, they could identify no additional
emission reduction measures. The incomplete cost analyses presented by
the District, changes in costs over time, and lack of justification for
rejecting measures to reduce pollution from building heating by
restricting or limiting the use of natural gas-fired heaters indicate
an insufficient economic feasibility analysis.
    Fourth, CARB and at least one other air district (Bay Area AQMD)
are moving forward in developing measures to set zero-emission
standards for space heaters and water heaters. In developing its 2022
State SIP Strategy (for the 2015 ozone NAAQS), CARB has stated that the
``fuels we use and burn in buildings, primarily natural gas, for space
and water heating contribute significantly to building-related criteria
pollutant and GHG emissions and provide an opportunity for substantial
emissions reductions where zero-emission technology is available.''
\145\ Accordingly, CARB is developing zero-emission standard concepts
and, given the intersection of air quality needs and other areas of
building and energy regulation, and identifying other regulatory
entities that they plan to engage, including the U.S. Department of
Energy, CEC, and the California Building Standards Commission,
Department of Housing and Community Development. We note, however, that
the proposed 2022 State SIP Strategy released August 12, 2022,
anticipates implementation starting in 2030, pending rule development
and CARB Board hearing in 2025.\146\
---------------------------------------------------------------------------

    \145\ CARB, ``Draft 2022 State Strategy for the State
Implementation Plan,'' January 31, 2022, 86-88.
    \146\ CARB, ``Proposed 2022 State Strategy for the State
Implementation Plan,'' August 12, 2022, 101-103.
---------------------------------------------------------------------------

    The Bay Area AQMD hosted public meetings in 2021 and developed
draft amendments to certain rules that would reduce NOX
emissions from residential and commercial furnaces and water
heaters.\147\ Specifically, Bay Area AQMD has developed draft
amendments to two rules: (1) Regulation 9, Rule 4 (``Nitrogen Oxides
from Fan Type Residential Central Furnaces''), which applies to
furnaces with a heat input rate of less than 175,000 Btu/hr and
combination heating and cooling units with a rated cooling capacity of
less than 65,000 Btu/hr (like SJVUAPCD Rule 4905); and (2) Regulation
9, Rule 6 (``Nitrogen Oxides Emissions from

Natural Gas-Fired Boilers and Water Heaters''), which applies to water
heaters with a rated heat input capacity of 75,000 Btu/hr or less (like
SJVUAPCD Rule 4902), as well as additional source types and sizes.\148\
---------------------------------------------------------------------------

    \147\ A summary of the Bay Area AQMD's rule development is
available at: https://www.baaqmd.gov/rules-and-compliance/rule-development/building-appliances.
    \148\ As in the San Joaquin Valley, larger boilers and similar
equipment used in industrial, institutional, and large commercial
settings are subject to other rules of the Bay Area AQMD, and
therefore not subject to Rule 4 or Rule 6.
---------------------------------------------------------------------------

    For Rule 4, Bay Area AQMD staff have developed draft amendments to
lower the current NOX emission limit for applicable furnaces
from 40 nanograms of NOX per joule of useful heat (ng/j) to
14 ng/j (which would match the limit in SJVUAPCD Rule 4905) in the
short term (with a compliance date of January 1, 2023); followed by a
zero-NOX emission requirement (with a compliance date of
January 1, 2029); and expand the applicability beyond fan-type central
furnaces to other types of equipment (e.g., wall furnaces and direct
vent units).\149\ For Rule 6, which contains NOX limits for
small boilers and water heaters, Bay Area AQMD staff proposes a zero-
NOX emission requirement. However, staff also note that
while technologies achieving zero-NOX emissions exist,
``they are limited in availability and can be expensive,'' that such
standards would be ``technology and market-forcing,'' and, therefore,
staff proposes compliance dates of January 1, 2027, and January 1,
2031, depending on equipment heat rate (i.e., the size of the boiler or
water heater).\150\
---------------------------------------------------------------------------

    \149\ Bay Area AQMD, ``Workshop Report, Draft Amendments to
Building Appliance Rules--Regulation 9, Rule 4: Nitrogen Oxides from
Fan Type Residential Central Furnaces and Rule 6: Nitrogen Oxide
Emissions from Natural Gas-Fired Boilers and Water Heaters,''
September 2021, 1.
    \150\ Id.
---------------------------------------------------------------------------

    CARB and Bay Area AQMD efforts in this area underscore the
importance of building heating emission sources, such as water heaters
and space heaters (e.g., furnaces), throughout California and the
continued effort to implement available control measures for these
sources for criteria pollutant attainment planning requirements. At the
same time, while SJVUAPCD, CARB, and Bay Area AQMD each acknowledge
that zero-NOX emission technology for small residential and
commercial space and water heating is available, it is unclear what a
feasible implementation horizon might be in light of CARB's strategy
and the Bay Area AQMD's draft amendments. The plan as submitted did not
address how such implementation considerations may or may not affect
the feasibility of setting such zero-NOX emission standards
for space and water heating in small residential and commercial
buildings in the SJV.
    Given the factors discussed above, we now propose that the State
has not adequately identified potential control measures, evaluated for
BACM/BACT, nor demonstrated the implementation of BACM/BACT for
controlling NOX and direct PM2.5 emissions from
building emission heating sources in the SJV.

C. Attainment Demonstration

1. Summary of 2021 Proposed Rule
    In sections IV.C (air quality modeling) and IV.F (attainment
demonstration) of our 2021 Proposed Rule, the EPA summarized the CAA
and regulatory requirements for air quality modeling and attainment
demonstrations, the State's submission in the SJV PM2.5
Plan, and our evaluation thereof.\151\ We briefly summarize those
components herein.
---------------------------------------------------------------------------

    \151\ 86 FR 74310, 74322-74324 (air quality modeling) and 74325-
74338 (attainment demonstration).
---------------------------------------------------------------------------

    Sections 188(c)(2) and 189(b)(1)(A) of the CAA require that Serious
area plans must include a demonstration (including air quality
modeling) that provides for attainment of the PM2.5 NAAQS as
expeditiously as practicable, but no later than the end of the tenth
calendar year after the area's designation as nonattainment. The
PM2.5 SIP Requirements Rule also specifies that the control
strategy in a Serious area attainment plan must provide for attainment
as expeditiously as practicable.\152\ The outermost statutory Serious
area attainment date for the 2012 annual PM2.5 NAAQS in the
SJV is December 31, 2025 (absent an EPA-approved attainment date
extension request under CAA section 188(e)). For purposes of
determining the attainment date that is as expeditious as practicable,
the State must conduct future year modeling that takes into account
emissions growth, known emissions controls (including any controls that
were previously determined to be RACM/RACT or BACM/BACT), any other
emissions controls required to meet BACM/BACT, and additional measures
as needed for expeditious attainment of the NAAQS. The regulatory
requirements for Serious area plans are codified at 40 CFR 51.1010
(control strategy requirements) and 40 CFR 51.1011(b) (attainment
demonstration and modeling requirements). We also described the EPA's
PM2.5 modeling guidance (``Modeling Guidance''),\153\
including our recommendations therein for photochemical modeling,
inputs, procedures, performance evaluation, emissions simulation, and
calculating relative response factors (RRFs).
---------------------------------------------------------------------------

    \152\ 40 CFR 51.1011(b)(1); 81 FR 58010, 58087.
    \153\ Memorandum dated November 29, 2018, from Richard Wayland,
Air Quality Assessment Division, OAQPS, EPA, to Regional Air
Division Directors, EPA, Subject: ``Modeling Guidance for
Demonstrating Air Quality Goals for Ozone, PM2.5, and
Regional Haze,'' (``Modeling Guidance'').
---------------------------------------------------------------------------

    With respect to air quality modeling, the 2018 PM2.5
Plan included the State's modeled attainment demonstration projecting
that the SJV will attain the 2012 annual PM2.5 NAAQS by
December 31, 2025; the State's primary discussion of the photochemical
modeling appears in Appendix K (``Modeling Attainment Demonstration'').
The State provides a conceptual model of PM2.5 formation in
the SJV as part of the modeling protocol in Appendix L (``Modeling
Protocol'') and describes emission input preparation procedures. The
State presents additional relevant information in Appendix C (``Weight
of Evidence Analysis'') of CARB's staff report for the 2018
PM2.5 Plan,\154\ which includes ambient trends and other
data in support of the demonstration of attainment by 2025.
---------------------------------------------------------------------------

    \154\ CARB, ``Staff Report, Review of the San Joaquin Valley
2018 Plan for the 1997, 2006, and 2012 PM2.5 Standards,''
release date December 21, 2018 (``CARB Staff Report'').
---------------------------------------------------------------------------

    In the 2021 Proposed Rule, the EPA presented its review of the
State's modeling approach and its many interconnected facets, including
model input preparation, model performance evaluation, use of the model
output for the numerical NAAQS attainment test, and modeling
documentation, and found it to be generally consistent with the EPA's
recommendations in the Modeling Guidance. We incorporated our
evaluation of the Plan's modeling for the 2006 24-hour PM2.5
NAAQS portion of the SJV PM2.5 Plan \155\ and extended that
evaluation with information specific to the 2012 annual
PM2.5 NAAQS. Overall, in the 2021 Proposed Rule, we
considered the State's analyses consistent with the EPA's guidance on
modeling for PM2.5 attainment planning purposes and proposed
to find that the modeling in the 2018 PM2.5 Plan was
adequate for the purposes of supporting the State's RFP demonstration
and the attainment demonstration.
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    \155\ EPA Region IX, ``Technical Support Document, EPA
Evaluation of Air Quality Modeling, San Joaquin Valley
PM2.5 Plan for the 2006 PM2.5 NAAQS,''
February 2020 (``EPA's 2006 NAAQS Modeling TSD'').
---------------------------------------------------------------------------

    With respect to the attainment demonstration, the SJV
PM2.5 Plan includes a modeled demonstration projecting
attainment of the 2012 annual PM2.5 NAAQS in the SJV by
December 31, 2025, based on emission reductions

from implementation of baseline control measures and the development,
adoption, and implementation of additional control measures to meet
specific enforceable commitments. In the EPA's 2021 Proposed Rule, we
described how the Plan's control strategy was to reduce emissions from
sources of NOX and direct PM2.5 and that most of
the projected emission reductions are achieved by baseline measures--
i.e., the combination of State and District measures adopted prior to
the State's and District's adoption of the Plan--that will achieve
ongoing emission reductions from the 2013 base year to the 2025
projected attainment year.
    The remainder of the Plan's emission reductions are to be achieved
by additional measures to meet enforceable commitments, including
potential regulatory and incentive-based measures and, as necessary,
substitute measures.\156\ In the Valley State SIP Strategy and the 2018
PM2.5 Plan, CARB and the District, respectively, included
commitments to take action on specific measures by specific years or to
develop substitute measures (referred to as ``control measure
commitments'') and to achieve specified amounts of NOX and
direct PM2.5 emission reductions by certain dates (referred
to as ``aggregate tonnage commitments'').\157\ We refer to these
complementary commitments herein as ``aggregate commitments.''
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    \156\ In this proposed rule, the term ``substitute measures''
means additional control measures that were not identified in CARB
and the District's original control measure commitments in adopting
the Valley State SIP Strategy and the 2018 PM2.5 Plan,
respectively. The ``substitute'' aspect primarily relates to
emission reductions (i.e., providing emission reductions where any
adopted measure achieves less emission reductions than originally
estimated, and/or providing emission reductions in lieu of any
originally planned measure that is not adopted). They are also
sometimes referred to as ``alternative measures'' in the SJV
PM2.5 Plan and adopting resolutions.
    \157\ CARB Resolution 18-49 and SJVUAPCD Governing Board
Resolution 18-11-16, paragraph 6.
---------------------------------------------------------------------------

    In the 2021 Proposed Rule, the EPA described several findings
relating to our evaluation of the SJV PM2.5 Plan's
attainment demonstration. First, we proposed to approve the Plan's
emissions inventories and to find the Plan's air quality modeling
adequate.\158\ Second, we proposed to find that the Plan provides for
expeditious attainment through the timely implementation of the control
strategy to reduce emissions from sources of NOX and direct
PM2.5, including RACM, BACM, and any other emission controls
necessary for expeditious attainment.
---------------------------------------------------------------------------

    \158\ Sections IV.A (emissions inventory) and IV.C (air quality
modeling) of the 2021 Proposed Rule.
---------------------------------------------------------------------------

    Third, the EPA proposed to find that the emissions reductions that
are relied on for attainment in the SIP submission are creditable. We
noted that the SJV PM2.5 Plan relies principally on already
adopted and approved rules to achieve the emissions reductions needed
to attain the 2012 annual PM2.5 NAAQS in the SJV by December
31, 2025, and that the balance of the reductions that the State has
modeled to achieve attainment by this date is currently represented by
enforceable commitments that account for 13.8% of the NOX
and 8.0% of the direct PM2.5 emissions reductions needed for
attainment. In terms of our evaluation of CARB and the District's
enforceable commitments, we proposed to find that circumstances in the
SJV for the 2012 annual PM2.5 NAAQS warrant the
consideration of enforceable commitments and that the EPA's three
criteria for such commitments had been met: (1) the commitments
constitute a limited portion of the required emissions reductions; (2)
both CARB and the District have demonstrated their capability to meet
their commitments; and (3) the commitments are for an appropriate
timeframe. We therefore proposed to approve the State's reliance on
these enforceable commitments in its attainment demonstration.
    Overall, in the 2021 Proposed Rule, we proposed to approve the SJV
PM2.5 Plan's demonstration of attainment of the 2012 annual
PM2.5 NAAQS by December 31, 2025, consistent with the
requirements of CAA section 189(b)(1)(A). We presented the basis for
our proposed determination in sections IV.F.3.a through IV.F.3.e of the
2021 Proposed Rule and provided further detail of our evaluation of
baseline measures and the additional measures and aggregate commitments
in sections II and IV, respectively, of the EPA's 2012 Annual
PM2.5 TSD.
2. Summary of Ninth Circuit Order and Adverse Comments
    As introduced in section I.D of this proposed rule, in response to
a petition for review of the EPA's approval of the 2006 24-hour
PM2.5 NAAQS portion of the SJV PM2.5 Plan, the
Ninth Circuit Court of Appeals issued a Memorandum Opinion that, in
part, vacated the final action with respect the EPA's second factor for
evaluating the validity of the State's enforceable commitments (i.e.,
whether the State is capable of fulfilling its commitment). The Ninth
Circuit's order is very relevant to this proposed rule because the
State relied on the same common control strategy, including the same
set of enforceable commitments (i.e., the same set of control measure
commitments and aggregate tonnage commitments) for both the 2006 24-
hour PM2.5 NAAQS Serious area plan and the 2012 annual
PM2.5 NAAQS Serious area plan.
    The Ninth Circuit found that the EPA ``fail[ed] to provide evidence
or a reasoned explanation for its conclusion that California will be
able to fulfill its commitment'' in the face of a potential multi-
billion dollar funding shortfall for incentive-based control measure
commitments, ``which could result in emission reduction shortfalls of
approximately 7% of the total NOX reductions and 8% of the
total PM2.5 reductions necessary for attainment.'' \159\ In
response to the EPA's arguments that: (1) the funding shortfall may be
smaller than projected; (2) emission reductions may be less expensive
than the strategy predicts; (3) certain yet-to-be-quantified sources of
reductions in the Plan may make up for shortfalls; and (4) California
and the District may identify other measures to fulfill their
commitments, the Court wrote that, ``[b]ecause these speculative
assertions are unsupported by the evidence, they fail to ensure that
California and the District have a plausible strategy for achieving
this portion of the attainment strategy, and therefore do not
collectively satisfy the second factor of the EPA's three-factor
test.'' \160\ It is important to emphasize that the State relied
heavily on the projected emission reductions that it hopes to achieve
through new control measures and emissions reductions reflected in the
aggregate commitments. These reductions are crucial to the State
meeting the modeled attainment demonstration and RFP requirements. If
it is not credible that the State can meet the commitments, then the
EPA cannot approve other nonattainment plan elements that rely upon
them.
---------------------------------------------------------------------------

    \159\ Medical Advocates for Healthy Air v. EPA, Case No. 20-
72780, Dkt. #58-1 (9th Cir., April 13, 2022), 6.
    \160\ Id. at 7.
---------------------------------------------------------------------------

    Separately, in comments on the EPA's 2021 Proposed Rule, Public
Justice states that CARB and the District's aggregate tonnage
commitments are to ``achieve a specific amount of reductions at the
last possible moment prior to the attainment deadline with no concrete
strategies for how that will be achieved.'' \161\ They assert that
prior plans with aggregate tonnage commitments for the 1997 annual
PM2.5 NAAQS by 2015 (i.e., the 2008 PM2.5 Plan)
and then by 2020 (i.e., the SJV PM2.5 Plan) failed to attain
those standards and that such past failures implies that the
commitments failed to

deliver the promised clean air.\162\ The commenters further state that
``deferred, unspecified, and last-minute promises to achieve reductions
(i.e., aggregate commitments), inflicts disparate impacts in violation
of Title VI,'' irrespective of whether the commitments comply with the
CAA.
---------------------------------------------------------------------------

    \161\ Public Justice Comment Letter, 20.
    \162\ Public Justice refers specifically to the EPA's November
2016 finding of failure to attain and the EPA's November 2021 final
disapproval of the 1997 annual PM2.5 NAAQS portion of the
SJV PM2.5 Plan. 81 FR 84481 (November 23, 2016) and 86 FR
67329 (November 26, 2021), respectively.
---------------------------------------------------------------------------

3. The EPA's Reconsidered Proposal
    As a result of the Ninth Circuit Memorandum Opinion with respect to
the SJV PM2.5 Plan's enforceable commitments, the EPA has
reconsidered its proposed approval of the Plan's demonstration of
attainment for the 2012 annual PM2.5 NAAQS in the SJV by
December 31, 2025, and now proposes to disapprove the Plan's attainment
demonstration. The Ninth Circuit Memorandum Opinion raised concerns
about the ability of CARB and the District to fulfill the commitments.
    We present our reconsideration in the following sections of this
proposed rule: (1) our reconsideration of CARB and the District's
enforceable commitments and proposal that the commitments do not meet
the second factor of the EPA's three-factor test (in section II.C.3.a);
and (2) the effect of our proposed disapproval of the State's
enforceable commitments and specific portions of the State's BACM
demonstration on the modeled attainment demonstration (in section
II.C.3.b).
a. Additional Measures and Enforceable Commitments
    In this subsection we re-examine CARB and the District's
enforceable commitments. We describe CARB and the District's progress
in adopting specific measures that they committed to present for
governing board adoption, and evaluate whether CARB and the District
have demonstrated the capability to achieve specific tonnages of
reductions that they committed to achieve by the 2025 attainment year.
We first enumerate the measures that have already been approved into
the SIP and quantify the amount of the tonnage commitment that these
account for. We then calculate CARB and the District's remaining
commitments as of the time of this notice, describe the strategy that
CARB and the District have provided for achieving the remaining
reductions (consisting of submitted measures that have not yet been
approved into the SIP, adopted measures that have not yet been
submitted to the EPA, measures under development, and other potential
future measures), and calculate the reductions that may be associated
with these measures. We conclude that although CARB and the District
have made substantial progress toward achieving the committed-to
reductions, CARB and the District have not presented a plausible
strategy demonstrating that they are capable of achieving the entirety
of the aggregate commitment.
    In our 2021 Proposed Rule, the EPA described the SJV
PM2.5 Plan's series of CARB and District commitments to
achieve emission reductions through additional control measures, beyond
baseline measures, that are intended to contribute to expeditious
attainment of the 2012 annual PM2.5 NAAQS. For mobile
sources, CARB identified a list of 12 State regulatory measures and 3
incentive-based measures that CARB has committed to propose to its
Board for consideration by specific years.\163\ For stationary sources,
the District identified a list of nine regulatory measures and three
incentive-based measures that the District has committed to propose to
its Board for consideration by specific years.\164\
---------------------------------------------------------------------------

    \163\ CARB Resolution 18-49, Attachment A and Valley State SIP
Strategy, Table 7 (``State Measures and Schedule for the San Joaquin
Valley''). The schedule of proposed SIP measures in Table 7 includes
two additional CARB measures: the second phase of the Advanced Clean
Cars Program (``ACC 2'') and the ``Cleaner In-Use Agricultural
Equipment'' measures. However, these measures are not scheduled for
implementation until 2026 and 2030, respectively, which is after the
January 1, 2025 implementation deadline under 40 CFR 51.1011(b)(5)
for control measures necessary for attainment by December 31, 2025.
Therefore, we are not reviewing these measures as part of the
control strategy to attain the 2012 annual PM2.5 NAAQS in
the SJV.
    \164\ SJVUAPCD Governing Board Resolution 18-11-16 and 2018
PM2.5 Plan, Table 4-4 (``Proposed Regulatory Measures'')
and Table 4-5 (``Proposed Incentive-Based Measures'').
---------------------------------------------------------------------------

    The Plan contains CARB's and the District's estimates of the
emission reductions that could be achieved by each of these additional
measures, if adopted as planned.\165\ As we described in our 2021
Proposed Rule, CARB's commitments are contained in CARB Resolution 18-
49 (October 25, 2018) and the Valley State SIP Strategy and consist of
two parts: a control measure commitment and a tonnage commitment.
---------------------------------------------------------------------------

    \165\ 2018 PM2.5 Plan, Ch. 4, Table 4-3 (''Emission
Reductions from District Measures'') and Table 4-9 (''San Joaquin
Valley Expected Emission Reductions from State Measures'') and
Valley State SIP Strategy, Table 8 (``San Joaquin Valley Expected
Emission Reductions from State Measures'').
---------------------------------------------------------------------------

    First, CARB has committed to ``begin the measure's public process
and bring to the Board for consideration the list of proposed SIP
measures outlined in the Valley State SIP Strategy and included in
Attachment A, according to the schedule set forth.'' \166\ By email
dated November 12, 2019, CARB confirmed that it intended to begin the
public process on each measure by discussing the proposed regulation or
program at a public meeting (workshop, working group, or Board hearing)
or in a publicly-released document, and to then propose the regulation
or program to its Board.\167\ Second, CARB has committed ``to achieve
the aggregate emissions reductions outlined in the Valley State SIP
Strategy of 32 tpd of NOX and 0.9 tpd of PM2.5
emissions reductions in the San Joaquin Valley by 2024 and 2025.''
\168\ The Valley State SIP Strategy explains that CARB's overall
commitment is to ``achieve the total emission reductions necessary to
attain the Federal air quality standards, reflecting the combined
reductions from the existing control strategy and new measures'' and
that ``if a particular measure does not get its expected emissions
reductions, the State is still committed to achieving the total
aggregate emission reductions.'' \169\
---------------------------------------------------------------------------

    \166\ CARB Resolution 18-49, 5.
    \167\ Email dated November 12, 2019, from Sylvia Vanderspek,
CARB, to Anita Lee, EPA Region IX, ``RE: SJV PM2.5
information'' (attaching ``Valley State SIP Strategy Progress'') and
CARB Staff Report, 14.
    \168\ CARB Resolution 18-49, 5.
    \169\ Valley State SIP Strategy, 7.
---------------------------------------------------------------------------

    Similarly, in our 2021 Proposed Rule, we explained that the
District's commitments are contained in SJVUAPCD Governing Board
Resolution 18-11-16 (November 15, 2018) and Chapter 4 of the 2018
PM2.5 Plan and also consist of two parts: a control measure
commitment and a tonnage commitment. First, the District has committed
to ``take action on the rules and measures committed to in Chapter 4 of
the Plan by the dates specified therein, and to submit these rules and
measures, as appropriate, to CARB within 30 days of adoption for
transmittal to EPA as a revision to the [SIP].'' \170\ By email dated
November 12, 2019, the District confirmed that it intended to take
action on the listed rules and measures by beginning the public process
on each measure, i.e., discussing the proposed regulation or program at
a public meeting, including a workshop, working group, or Board
hearing, or in a publicly-released document, and then proposing the
rule or measure to the SJVUAPCD Governing Board.\171\ Second, the
District has

committed to ``achieve the aggregate emissions reductions of 1.88 tpd
of NOX and 1.3 tpd of PM2.5 by 2024/2025''
through adoption and implementation of these measures or, if the total
emission reductions from these rules or measures are less than these
amounts, ``to adopt, submit, and implement substitute rules and
measures that achieve equivalent reductions in emissions of direct
PM2.5 or PM2.5 precursors'' in the same
implementation timeframes.\172\
---------------------------------------------------------------------------

    \170\ SJVUAPCD Governing Board Resolution 18-11-16, 10-11.
    \171\ Email dated November 12, 2019, from Jon Klassen, SJVUAPCD,
to Wienke Tax, EPA Region IX, ``RE: follow up on aggregate
commitments in SJV PM2.5 Plan'' (attaching ``District
Progress in Implementing Commitments with 2018 PM2.5
Plan'').
    \172\ SJVUAPCD Governing Board Resolution 18-11-16, 10-11.
---------------------------------------------------------------------------

    In sections IV.F.3.c and IV.F.3.d of our 2021 Proposed Rule, the
EPA described CARB's and the District's progress as of that point in
time on their control measure commitments and progress towards
fulfilling their respective aggregate commitments, respectively. Based
on our reconsideration of the State's enforceable commitments in light
of the Ninth Circuit Memorandum Opinion, while we propose to retain
certain findings with respect to the State's progress, we now propose
that the State has not adequately demonstrated that it can fulfill the
remaining portions of its enforceable commitments (i.e., the second
factor of the EPA's three-factor test). We present our reconsidered
evaluation of the status of CARB's and the District's control strategy
and our three-factor test for enforceable commitments, as follows.
    With respect to progress on the control measure commitments, CARB
and the District together have adopted 18 measures of the 27 control
measure commitments in the SJV PM2.5 Plan and have begun the
public process on 5 of the remaining control measure commitments, which
is unchanged since the time of our 2021 Proposed Rule. This progress is
described in further detail in CARB and the District's ``Progress
Report and Technical Submittal for the 2012 PM2.5 Standard
San Joaquin Valley'' (2021 Progress Report).\173\ For CARB's portion,
CARB has adopted 10 of the 15 measures identified in its commitment
(including one incentive-based measure) and begun the public process on
3 of the remaining 5 measures. For the District's portion of the
control measure commitments, the District has adopted 8 of the 12
measures identified in its commitment (including one incentive-based
measure) and begun the public process on 2 of the remaining 4 measures.
---------------------------------------------------------------------------

    \173\ ``Progress Report and Technical Submittal for the 2012
PM2.5 Standard San Joaquin Valley,'' October 19, 2021.
Transmitted to the EPA by letter dated October 20, 2021, from
Richard W. Corey, Executive Officer, CARB, to Deborah Jordan, Acting
Regional Administrator, EPA Region IX. See sections of 2021 Progress
Report entitled ``Progress in Implementing District Measures'' and
``Progress in Implementing CARB Measures.''
---------------------------------------------------------------------------

    Although CARB and the District have made substantial progress in
developing and adopting the regulatory measures listed in their
respective control measure commitments, they have not yet fulfilled the
commitments for several measures in accordance with the timeframes
established in the SJV PM2.5 Plan. We provide further detail
on CARB and the District's control measure commitments in section IV.A
of the EPA's 2012 Annual PM2.5 TSD (including tables IV-A
and IV-B regarding CARB and the District's control measure commitments,
respectively).\174\
---------------------------------------------------------------------------

    \174\ We note that Table IV-A of the EPA's 2012 Annual
PM2.5 TSD contained an error with respect to the adoption
date of CARB's measure for Transportation Refrigeration Units Used
for Cold Storage. While CARB had heard proposed amendments to the
measure on September 23, 2021, the measure was not actually adopted
until February 24, 2022, following further process and rule
adjustments required by the Board. CARB Resolution 22-5, February
24, 2022.
---------------------------------------------------------------------------

    Regarding the remaining nine measures not yet proposed for board
consideration, we continue to note that one measure, Rule 4550
(``Conservation Management Practices''), has an action year of 2022 in
the 2018 PM2.5 Plan (i.e., the District has the remainder of
2022 to present a proposed measure for board consideration) and that
four regulatory measures and four incentive-based measures are overdue.
For the four regulatory measures, while CARB and the District have not
proposed these measures to their respective boards, they began the
public process on each of the four measures on time with respect to the
schedule of their respective public process commitments. To our
knowledge, CARB anticipates board consideration of the diesel fuel
measures in 2022 and the forklift measure in 2022 or 2023 \175\ and
continues to develop the airport ground support equipment measure; the
District continues to evaluate potential amendments to Rule 4692 in the
near future.\176\
---------------------------------------------------------------------------

    \175\ In the 2021 Progress Report (dated October 19, 2021), page
20, CARB indicates that the Zero-Emission Off-Road Forklift
Regulation Phase 1 would be presented for Board consideration ``as
early as 2022,'' while CARB's updated ``SJV PM2.5 SIP
Measure Tracking'' (dated December 2021) anticipates presenting the
measure to the Board in Summer 2023.
    \176\ 2021 Progress Report, 8-9, 20-22, and tables 2 and 3.
---------------------------------------------------------------------------

    For the four incentive-based measures, CARB and the District
continue to invest in reducing emissions from heavy-duty trucks and
buses, off-road equipment, agricultural operation internal combustion
engines, and commercial under-fired charbroiling.\177\ However, while
CARB and the District have discussed the proposed programs at board
hearings,\178\ to our knowledge, CARB and the District have not started
the public process for the four incentive-based control measure
commitments as enforceable measures to be submitted to the EPA for
approval and inclusion as control measures in the California SIP.
Furthermore, as discussed in section IV.F.3.c of our 2021 Proposed
Rule, for heavy-duty trucks and off-road equipment, CARB acknowledges
that many of the project lives do not span the attainment year \179\
and, thus, while these projects may accelerate emission reductions and
benefit communities in the SJV, the projects that qualify for SIP
credit may be limited for the purposes of the 2012 annual
PM2.5 NAAQS Serious area attainment demonstration.
---------------------------------------------------------------------------

    \177\ CARB, ``Long-Term Heavy-Duty Investment Strategy,
Including Fiscal Year 2020-21 Three-Year Recommendations for Low
Carbon Transportation Investments,'' (App. D to CARB's ``Proposed
Fiscal Year 2021-22 Funding Plan for Clean Transportation
Incentives''), release date October 8, 2021; and SJVUAPCD,
``Comprehensive Annual Financial Report, Fiscal Year Ended June 30,
2020,'' release date December 23, 2020. See also, 2021 Progress
Report, 3 and 15.
    \178\ For example, CARB staff discussed the Accelerated Turnover
of Trucks and Buses Incentive Measure at its annual 2020 update to
the CARB Board. CARB presentation, ``Update on the 2018
PM2.5 SIP for the San Joaquin Valley,'' October 22, 2020.
District staff discussed and adopted an emission reductions strategy
for commercial under-fired charbroiling, including incentives, in
December 2020. SJVUAPCD, ``Item Number 11: Adopt Proposed Commercial
Under-Fired Charbroiling Emission Reduction Strategy,'' December 17,
2020.
    \179\ Id. at 24 and 32. Generally, mobile source incentive
projects implemented under the Carl Moyer program are under contract
only during the ``project life'' and may not be credited with SIP
emission reductions after the project life ends. EPA Region IX,
``Technical Support Document for EPA's Rulemaking for the California
State Implementation Plan California Air Resources Board Resolution
19-26 San Joaquin Valley Agricultural Equipment Incentive Measure,''
February 2020, 12-13.
---------------------------------------------------------------------------

    Overall, while CARB and the District have made substantial progress
in developing and adopting the regulatory measures listed in their
respective control measure commitments that were submitted in the SJV
PM2.5 Plan, in light of the Ninth Circuit Memorandum
Opinion, we have reconsidered the effect of the eight overdue measures
of the original commitments and in particular the overdue incentive-
based measures, on our evaluation of CARB and the District's aggregate
tonnage commitments and our three-factor test. Under the second factor
of the EPA's test for enforceable commitments, the

Agency must evaluate whether a State is capable of fulfilling such
commitments. The tardiness of presenting these control measures for
board consideration renders the reductions from these measures more
speculative under the second factor.
    With respect to the aggregate tonnage commitments to attain the
2012 annual PM2.5 NAAQS in the SJV, we reiterate that CARB
committed to achieve 32 tpd of NOX and 0.9 tpd of
PM2.5 emissions reductions, and the District committed to
achieve 1.88 tpd of NOX and 1.3 tpd of PM2.5
emissions reductions by 2025. These aggregate tonnage commitments sum
to 33.88 tpd NOX and 2.2 tpd direct PM2.5. CARB
and the District have committed to achieve these reductions via the 27
control measure commitments, or such other substitute measures as may
be necessary, to achieve the aggregate tonnage commitments for
NOX and direct PM2.5.
    For the purpose of our analysis of the State's progress toward
achieving its aggregate tonnage commitments, of the 18 measures adopted
by December 2021, as well as the adoption of an important substitute
measure (the Agricultural Burning Phase-out Measure \180\), the State
has submitted 12 measures as revisions to the California SIP (i.e.,
more than the 9 measures submitted to EPA as of the time of the 2021
Proposed Rule). Since December 2021, the EPA finalized or proposed
approval of three control measure SIP submissions that were control
measure commitments in the SJV PM2.5 Plan.
---------------------------------------------------------------------------

    \180\ See 87 FR 36222 (June 16, 2022).
---------------------------------------------------------------------------

    First, the EPA finalized approval of the Heavy-Duty Vehicle
Inspection Program (HDVIP) and Periodic Smoke Inspection Program
(PSIP).\181\ However, as in our 2021 Proposed Rule, CARB has not yet
provided its analysis of the basis for this emission reduction estimate
(of 0.02 tpd direct PM2.5, per the State's 2021 Progress
Report). Therefore, the EPA is not proposing at this time to credit
this measure with any particular amount of emission reductions towards
attainment of the 2012 annual PM2.5 NAAQS in the SJV.
---------------------------------------------------------------------------

    \181\ 87 FR 27949 (May 10, 2022).
---------------------------------------------------------------------------

    Second, the EPA finalized approval of the Agricultural Burning
Phase-out Measure,\182\ which includes a schedule to phase-out (i.e.,
introduce prohibitions of) agricultural burning for additional crop
categories or materials accounting for a vast majority of the tonnage
of agricultural waste in phases that started January 1, 2022, and
become fully implemented by January 1, 2025.\183\ The EPA received
comments from the District that supported approval of the Agricultural
Burning Phase-out Measure into the SIP while also advocating for a
higher rule effectiveness rate (i.e., 95% instead of EPA's proposed
80%),\184\ which in turn would increase the amount of emission
reductions that the EPA would credit towards fulfilling the District's
aggregate tonnage commitment. We continue to evaluate these comments
and for now have retained our proposal to credit the measure for
emission reductions of 0.83 tpd NOX and 1.23 tpd direct
PM2.5, consistent with the 80% rule effectiveness rate used
by the EPA in the 2021 Proposed Rule.
---------------------------------------------------------------------------

    \182\ 87 FR 36222.
    \183\ SJVUAPCD, ``Supplemental Report and Recommendations on
Agricultural Burning,'' June 17, 2021 (``2021 Supplemental
Report''), including Table 2-1 (``Accelerated Reductions by Crop
Category'').
    \184\ Letter dated January 25, 2022, from Jonathan Klassen,
Director of Air Quality Science and Planning, SJVUPACD, to Michael
Regan, Administrator, U.S. EPA.
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    Third, the EPA has proposed approval of Rule 4311 (``Flares''), as
amended December 17, 2020.\185\ The District's staff report for Rule
4311 estimates that the emission reductions from these amendments would
be 0.19 tpd NOX and 0.03 tpd direct PM2.5 in
2025.\186\ The EPA continues to evaluate the District's estimate with
respect to SIP-creditable emission reductions, though we note that they
are relatively small when compared to the overall 207.38 tpd
NOX and 6.4 tpd direct PM2.5 modeled to attain
the 2012 PM2.5 NAAQS and to the combined aggregate tonnage
commitments of 33.88 tpd NOX and 2.2 tpd direct
PM2.5.
---------------------------------------------------------------------------

    \185\ 87 FR 3736 (January 25, 2022).
    \186\ SJVUAPCD, ``Item Number 12: Adopt Proposed Amendments to
Rule 4311 (Flares),'' December 17, 2020, Attachment C (``Final Draft
Staff Report with Appendices for Proposed Amendments to Rule
4311''), 21-22.
---------------------------------------------------------------------------

    Similar to our 2021 Proposed Rule, we propose to credit reductions
from three measures, all of which are now approved into the SIP and
have large associated emission reductions of direct PM2.5
and/or NOX in the SJV.\187\ The three measures are: Rule
4901 (``Wood Burning Fireplaces and Wood Burning Heaters''); two of
three parts of the Agricultural Equipment Incentive Measure (for which
we described our proposed SIP credit in the 2021 Proposed Rule); and
the Agricultural Burning Phase-out Measure (for which we described our
proposed SIP credit in this proposed rule).\188\
---------------------------------------------------------------------------

    \187\ The seven additional measures submitted as SIP revisions
for which the EPA has not proposed action as of August 2022 include:
the Innovative Clean Transit measure (submitted February 13, 2020);
Rules 4306 and 4320 (submitted March 12, 2021); Rule 4702 (submitted
October 15, 2021); Rules 4352 and 4354 (submitted March 9, 2022),
and the Residential Wood Burning Incentive Measure (submitted March
17, 2022).
    \188\ Final actions on these measures are as follows: 85 FR
44206 (July 22, 2020) (Rule 4901), 86 FR 73106 (December 27, 2021)
(Agricultural Equipment Incentive Measure), and 87 FR 36222 (June
16, 2022) (Agricultural Burning Phase-out Measure).
---------------------------------------------------------------------------

    Based on these SIP-approved measures, our estimate of the remaining
aggregate tonnage commitments remains the same as in our 2021 Proposed
Rule. Specifically, in Table 1 herein we summarize the total
NOX and direct PM2.5 emission reductions that the
State models as sufficient to attain the 2012 annual PM2.5
NAAQS in the SJV by December 31, 2025, the emission reductions
attributed to baseline measures and new control strategy measures
(including only measures currently approved into the California SIP),
and the emission reductions remaining as aggregate tonnage commitments.

    Table 1--Reductions for Attainment in 2025 and Aggregate Tonnage
                               Commitments
------------------------------------------------------------------------
                                                           Direct PM2.5
                                            NOX  (tpd)         (tpd)

------------------------------------------------------------------------
A................  Total reductions from          207.38             6.4
                    baseline and control
                    strategy measures
                    modeled to achieve
                    attainment.
B................  Reductions from                 173.5             4.2
                    baseline measures.
C................  Reductions from                  5.29            1.69
                    additional measures
                    approved into the
                    California SIP.
D................  Total reductions                28.59            0.51
                    remaining as
                    commitments (A-B-C).
E................  Percent of total                13.8%            8.0%
                    reductions needed
                    remaining as
                    commitments (D/A).
------------------------------------------------------------------------
Sources: 2018 PM2.5 Plan, Ch. 4, tables 4-3 and 4-7, and Appendix B,
  tables B-1 and B-2.

    As shown in Table 1, 13.8% of the NOX reductions
necessary for attainment and 8.0% of the direct PM2.5
reductions necessary for attainment remain as aggregate tonnage
commitments (i.e., combining CARB and the District's remaining
commitments).\189\ Based on the direct PM2.5 emission
reductions that the EPA has credited to Rule 4901 (0.2 tpd) and the
Agricultural Burning Phase-out Measure (1.23 tpd), which add up to 1.43
tpd, we conclude that the District has exceeded its 1.3 tpd direct
PM2.5 commitment by 0.13 tpd.
---------------------------------------------------------------------------

    \189\ However, we note that if the EPA were to grant maximum
credit for the emission reductions calculated by the District for
Rule 4311 (0.19 tpd NOX and 0.03 tpd direct
PM2.5), the remaining aggregate tonnage commitments would
be 28.4 tpd NOX (13.7% of total reductions needed to
attain in 2025) and 0.48 tpd direct PM2.5 (7.5% of total
reductions needed to attain in 2025).
---------------------------------------------------------------------------

    Beyond the measures that the EPA has taken final action to approve
into the California SIP and proposed to credit herein, CARB has
provided updated emission reduction estimates for 10 additional
measures, including 9 that have been adopted, as well as one substitute
measure in development, as described in the 2021 Progress Report. The
CARB measure with the largest updated emission reduction estimates is
the Heavy-Duty Vehicle Inspection and Maintenance Program (``Heavy-Duty
I/M'').
    The District has similarly provided updated emission reduction
estimates for seven additional measures, including six that have been
adopted. The District measures with the largest updated emission
reduction estimates include amendments to Rule 4702 (``Internal
Combustion Engines'') (0.61 tpd NOX), the Residential Wood
Burning Devices Incentive Projects measure (0.33 tpd direct
PM2.5), and Rule 4354 (``Glass Melting Furnaces'') (0.5 tpd
NOX and 0.04 tpd direct PM2.5), as well as
amendments planned in 2022 to Rule 4550 (``Conservation Management
Practices'') (0.32 tpd direct PM2.5).
    The EPA is not proposing to credit towards the aggregate tonnage
commitments the updated emission reduction estimates from these
additional District measures. We will review and act on the CARB and
District measures submitted to date (Innovative Clean Transit, Rule
4306, Rule 4320, Rule 4702, Rule 4352, Rule 4354, and the Residential
Wood Burning Incentive Measure), as well as future measure submissions,
in separate rulemakings, during which time the public will have an
opportunity to review and provide comment.
    Although we are not proposing to credit reductions from these
measures at this time, in order to determine whether CARB and District
have the capability to meet their aggregate tonnage commitments, we
have re-evaluated the updated emission reduction estimates to assess
whether they could meet the NOX and/or direct
PM2.5 emission reduction commitments with these measures or,
if not, how much would remain of CARB and the District's unfulfilled
aggregate tonnage commitments.

 Table 2--Hypothetical Emission Reductions From Estimated, Adopted, and/
   or Submitted Additional Measures and Effect on Remaining Aggregate
                      Tonnage Commitments for 2025
------------------------------------------------------------------------
                                                           Direct PM2.5
                                            NOX  (tpd)         (tpd)

------------------------------------------------------------------------
A................  Total reductions               207.38             6.4
                    needed from baseline
                    and control strategy
                    measures (see Table
                    1, row A of this
                    proposed rule).
B................  Total reductions                28.59            0.51
                    remaining as
                    commitments after
                    SIP credit (see
                    Table 1, row D of
                    this proposed rule).
                   CARB:
                   Submitted Measures:
                       HDVIP and PSIP                  0            0.02
                        \a\.
                       Innovative Clean            0.017          <<0.01
                        Transit.
                                         -------------------------------
C................        Sub-Total......           0.017            0.02
                   Additional Adopted
                    Measures:
                       Heavy-Duty I/M...            14.7            0.03
                       Amended Warranty             0.34          <<0.01
                        Requirements for
                        Heavy-Duty
                        Vehicles.
                       Heavy-Duty Low-                 0               0
                        NOX Engine
                        Standard--Califo
                        rnia Action.
                       Advanced Clean               0.08          <<0.01
                        Local Trucks
                        (Last Mile
                        Delivery).
                       Zero-Emission              <<0.01          <<0.01
                        Airport Shuttle
                        Buses.
                       Small Off-Road              0.155           0.007
                        Engines.
                       Transport                    0.04            0.01
                        Refrigeration
                        Units Used for
                        Cold Storage.
                       Agricultural                 0.64            0.04
                        Equipment
                        Incentive
                        Measure-Phase 1
                        (NRCS portion).
                                         -------------------------------
                       Agricultural                  4.9             0.5
                        Equipment
                        Incentive
                        Measure Phase 2.
                                         -------------------------------
D................        Sub-Total......          15.955           0.087
                   Measures Not Yet
                    Presented for Board
                    Consideration: \b\
                       Zero-Emission Off-           0.02          <<0.01
                        Road Forklift
                        Regulation Phase
                        1.
                       Agricultural                  4.9             0.5
                        Equipment
                        Incentive
                        Measure Phase 2.
                                         -------------------------------
E................        Sub-Total......            4.92             0.5
F................        Grand Total for          20.892           0.607
                          CARB (C+D+E).
                                         -------------------------------
                   SJVUAPCD:
                   Submitted Measures:
                       Rule 4311                    0.19            0.03
                        (``Flares'').
                       Rule 4306                    0.19               0
                        (``Boilers,
                        Steam
                        Generators, and
                        Process Heaters--
                        Phase 3'').
                       Rule 4320                       0               0
                        (``Advanced
                        Emission
                        Reduction Option
                        for Boilers,
                        Steam
                        Generators, and
                        Process Heaters
                        greater than 5
                        MMBtu/hr'') \c\.
                       Rule 4352                     0.5            0.04
                        (``Solid Fuel
                        Fired Boilers,
                        Steam
                        Generators, and
                        Process
                        Heaters'').
                       Rule 4354                     0.2            0.04
                        (``Glass Melting
                        Furnaces'').

                       Rule 4702                    0.61               0
                        (``Internal
                        Combustion
                        Engines'').
                       Residential Wood                0            0.33
                        Burning
                        Incentive
                        Measure.
                                         -------------------------------
G................        Sub-Total......            1.69            0.44
                   Measures Not Yet
                    Presented for Board
                    Consideration:
                       Rule 4550                       0            0.32
                        (``Conservation
                        Management
                        Practices'').
                                         -------------------------------
H................        Sub-Total......               0            0.32
                                         -------------------------------
I................        Grand Total for            1.69            0.76
                          SJVUAPCD (G+H).
                                         -------------------------------
J................        Grand Total               22.58            1.37
                          (F+I).
                                         -------------------------------
K................  Assuming maximum SIP             6.01           -0.86
                    credit, total
                    reductions remaining
                    as commitments (B-J).
------------------------------------------------------------------------
Sources: 2021 Progress Report, Table 2 and Table 3.
\a\ As discussed herein, the EPA has taken final action to approve
  CARB's HDVIP and PSIP measure into the California SIP but we are not
  yet proposing SIP credit for these two measures.
\b\ Given the complexities involved in regulating locomotive emissions,
  we have conservatively excluded from our analysis the emission
  reduction estimates in the 2021 Progress Report for CARB's In-Use
  Locomotive Measure.
\c\ The District's draft staff report for Rule 4306 and Rule 4320
  estimate emission reductions of 0.19 tpd NOX and 0.45 tpd NOX,
  respectively, in 2024. However, the District notes that it is not
  proposing the emission reductions from Rule 4320 for SIP credit at
  this time. SJVUAPCD, ``Draft Staff Report, Proposed Amendments to Rule
  4306 (Boilers, Steam Generators, and Process Heaters--Phase 3),
  Proposed Amendments to Rule 4320 (Advanced Emission Reduction Options
  for Boilers, Steam Generators, and Process Heaters Greater Than 5.0
  MMBtu/hr),'' November 25, 2020, 4.

    Assuming the EPA were to agree with the maximum credit for the
emission reductions estimated by CARB and the District in the 2021
Progress Report, these additional measures could achieve emission
reductions of 22.58 tpd NOX and 1.37 tpd direct
PM2.5. Combined with the reductions from additional measures
already approved by EPA into the California SIP (5.29 tpd
NOX and 1.69 tpd direct PM2.5, per Row C of Table
1 of this proposed rule), the State would achieve emission reductions
of 27.87 tpd NOX and 3.06 tpd direct PM2.5.
Compared to the combined aggregate tonnage commitments, the State would
have remaining aggregate tonnage commitments of 6.01 tpd NOX
and would have exceeded the aggregate tonnage commitments by 0.86 tpd
direct PM2.5. More specifically, CARB would have remaining
commitments of 6.65 tpd NOX and 0.03 tpd direct
PM2.5, and the District would have exceeded its commitments
by 0.64 tpd NOX and 0.89 tpd direct PM2.5.
    However, given the remaining NOX commitments for CARB,
which are approximately 3% of the NOX emission reductions
modeled to attain the 2012 annual PM2.5 NAAQS in the SJV by
2025, we have given additional consideration to the evidence of
emission reductions for two source categories that have large emission
reduction estimates: Heavy-Duty I/M and the Agricultural Equipment
Incentive Measures, including the NRCS portion of the Phase 1 measure
adopted by CARB in 2019 and the Phase 2 measure slated for 2024
consideration, per the 2021 Progress Report.
    With respect to Heavy-Duty I/M, in the Valley State SIP Strategy,
CARB originally estimated that it would achieve 6.8 tpd NOX
and <0.1 tpd direct PM2.5 in 2025 and described the
regulatory concepts that would reflect the current (as of 2018)
``advanced engine and exhaust control technologies, including on-board
diagnostics (OBD).'' \190\ Since that time, as described in the State's
2021 Progress Report and the EPA's 2021 Proposed Rule, California has
developed additional provisions related to Heavy-Duty I/M that the
State estimates would achieve emission reductions of 14.7 tpd
NOX and 0.03 tpd direct PM2.5 in 2025.\191\
---------------------------------------------------------------------------

    \190\ Valley State SIP Strategy, 19-20 and Table 8.
    \191\ 2021 Progress Report, 19. CARB notes that further detail
on emission reduction calculations can be found in the CARB staff
report on Heavy-Duty I/M, released October 15, 2021. See, CARB,
``Staff Report: Initial Statement of Reasons, Public Hearing to
Consider the Proposed Heavy-Duty Inspection and Maintenance
Regulation,'' October 8, 2021, (``Heavy-Duty I/M ISOR'') and App. H
(``Proposed Heavy-Duty Inspection and Maintenance Regulation,
Standardized Regulatory Impact Assessment'').
---------------------------------------------------------------------------

    While the EPA would still not propose to approve a specific amount
of SIP-creditable reductions until after the State submits such measure
in final form to the EPA as a revision to the SIP, we have re-examined
the role of the potential additional emission reductions from Heavy-
Duty I/M presented by CARB. As a qualitative matter, we agree that the
requirements under California Senate Bill 210 (2019) that heavy-duty
vehicles comply with Heavy-Duty I/M in order to register annually with
the California Department of Motor Vehicles, as well as the
implementation of roadside emissions monitoring (i.e., the Portable
Emissions AcQuisition System, ``PEAQS'') in the SJV to detect high
emitting vehicles between periodic test cycles, are tangible additions
that would increase the emission reductions relative to what was
contemplated at the time of Plan adoption in November 2018 (by the
District) and January 2019 (by CARB).
    As a quantitative matter, however, the scale of the estimated 14.7
tpd NOX emission reductions is roughly half the remaining
aggregate commitment of 28.59 tpd NOX and represents 7.1% of
the 207.38 tpd NOX modeled for attainment and a substantial
increase from CARB's original estimate of 6.8 tpd NOX (3.3%
of the 207.38 tpd NOX). This 14.7 tpd NOX
represents a substantial quantity that, pursuant to the Ninth Circuit
Memorandum Opinion, must be supported by evidence to ``ensure that
California and the District have a plausible strategy for achieving
this portion of the attainment strategy'' in order to satisfy the
second factor of the three-factor aggregate commitment test.\192\ While
CARB documented its extensive regulatory and technical

analyses in the measure's Initial Statement of Reasons and associated
appendices,\193\ CARB has not provided the detailed basis of its
calculations of 14.7 tpd NOX and 0.03 tpd direct
PM2.5 emission reductions to the EPA. Given that CARB may do
so in a future control measure SIP submission, and we lack the record
evidence to do so here, we do not suggest an alternative amount of
emission reduction from Heavy-Duty I/M in this proposed rule. Rather,
we note that the more detailed calculations and technical report
necessary to support such an estimate, specific to the SJV and to
annual average emission reductions in 2025, are not available, and
therefore we do not have sufficient support in the record at this time
to rely on the State's estimated reductions, in line with the Ninth
Circuit Memorandum Opinion.
---------------------------------------------------------------------------

    \192\ See Medical Advocates for Healthy Air v. EPA, Case No. 20-
72780, Dkt. #58-1, 7 (9th Cir., April 13, 2022).
    \193\ Heavy-Duty I/M ISOR and, for example, Heavy-Duty I/M ISOR,
App. D (``Emissions Inventory Methods and Results, Proposed Heavy-
Duty Inspection and Maintenance Regulation'') and App. H (``Proposed
Heavy-Duty Inspection and Maintenance Regulation, Standardized
Regulatory Impact Assessment'').
---------------------------------------------------------------------------

    With respect to mobile agricultural equipment, the EPA has taken
final action to approve the Funding Agricultural Replacement Measures
for Emission Reductions (FARMER) program and the Carl Moyer Memorial
Air Quality Standards Attainment Program (``Carl Moyer'') portions of
CARB's first incentive measure on agricultural equipment in the SJV
(``Agricultural Equipment Incentive Measure-Phase 1'') and proposed in
our 2021 Proposed Rule to credit emission reductions of 4.46 tpd
NOX and 0.26 tpd direct PM2.5 towards CARB's
aggregate tonnage commitments.\194\ CARB has estimated that it will
achieve 4.9 tpd additional NOX reductions, and 0.5 tpd
additional direct PM2.5 reductions through a second
agricultural equipment incentive measure. In light of the Ninth Circuit
Memorandum Opinion, and its finding that the EPA had not ensured that
CARB and the District had a ``plausible strategy'' for achieving parts
of the attainment strategy that relied on incentive-based reductions in
the face of a budget shortfall for funding these measures, we must
evaluate whether there is sufficient evidence in the record to
establish a reasonable basis for concluding that any ``Phase 2''
agricultural equipment incentive measure will have sufficient funding
to achieve the reductions ascribed to it.
---------------------------------------------------------------------------

    \194\ 86 FR 74310, 74332; 86 FR 73106, 73109.
---------------------------------------------------------------------------

    As we noted in the EPA's 2021 Proposed Rule, fewer incentive-based
emission reductions are needed to demonstrate attainment of the 2012
annual PM2.5 NAAQS than were required in the portion of the
SJV PM2.5 Plan addressing the 2006 24-hour PM2.5
NAAQS that was at issue in the Medical Advocates case.\195\ In the
Ninth Circuit Memorandum Opinion, the court pointed to a $2.6 billion
shortfall between what the EPA calculated to be a need for $5 billion
in funding and the more than $2 billion in funding that the State had
``identified or anticipated.'' \196\ Notably, funding for the Carl
Moyer, California Assembly Bill 617, and FARMER programs were included
in the ``identified or anticipated'' portion of the State's funding
analysis, and not the ``incentive funding gap'' for which the Court
found EPA's explanations justifying approval to be overly
speculative.\197\ Accordingly, we do not consider reliance on
reductions from a Phase 2 agricultural equipment incentive measure to
be prohibited by the Ninth Circuit Memorandum Opinion, to the extent
that a Phase 2 rule would rely on the same, existing programs, and
provided that evidence of sufficient identified or reasonably
anticipated funding exists in the record.
---------------------------------------------------------------------------

    \195\ 86 FR 74310, 74330. This is due to greater-than-expected
reductions from committed to and substitute non-incentive regulatory
measures, such as the Agricultural Burning Phase-Out Measure.
    \196\ Medical Advocates for Healthy Air v. EPA, Case No. 20-
72780, Dkt. #58-1, 7; 85 FR 44192, 44201.
    \197\ CARB Staff Report, 27 (Table 9).
---------------------------------------------------------------------------

    As described in the EPA's analysis of the cost-effectiveness of the
Agricultural Equipment Incentive Measure-Phase 1, based on information
provided by CARB, the total project costs resulting in these emission
reductions were $155 million for FARMER and $125 million for Carl
Moyer, or $280 million combined.\198\ As described in the EPA's 2021
Proposed Rule,\199\ the SJV portion of the FARMER funding has typically
been 80% of the State-wide allocation and the first three years of
FARMER funding for the SJV were $108 million (fiscal year 2017-2018),
$104.3 million (fiscal year 2018-2019), and $43.84 million (fiscal year
2019-2020).\200\ For the current fiscal year (2021-2022), the District
accepted $168.43 million in FARMER funds to replace agricultural
equipment in the SJV.\201\ Similarly, we noted that CARB expects Carl
Moyer funding to increase in future years, following the enactment of
California Assembly Bill 1274.\202\
---------------------------------------------------------------------------

    \198\ Memorandum dated June 22, 2020, from Rebecca Newhouse, EPA
Region IX, to docket number EPA-R09-OAR-2019-0318, Subject: ``Cost-
effectiveness of Emission Reductions from the Valley Incentive
Measure and Estimated Future Funding Needs for Additional
Agricultural Equipment Replacements'' (``EPA Cost-Effectiveness
Memo'').
    \199\ 86 FR 74310, 74337.
    \200\ CARB, ``Funding Agricultural Replacement Measures for
Emission Reductions (FARMER) Program, San Joaquin Valley APCD,'' as
reported through September 30, 2020.
    \201\ SJVUAPCD, ``Item Number 9: Accept $168,425,600 in State
FARMER Program Funds for Use in the District's Agricultural
Equipment Replacement Project,'' March 17, 2022.
    \202\ 2021 Progress Report, 22.
---------------------------------------------------------------------------

    Thus, while future funding allocations are subject to annual State
and local funding cycles, given the renewed, large investment in the
fiscal year 2021-2022 FARMER program, potential for increases in
funding for the Carl Moyer program, and the success of these programs
in meeting enforceability criteria for purposes of crediting emission
reductions, the EPA anticipates that CARB will be able to develop an
additional agricultural equipment incentive measure (``Agricultural
Equipment Incentive measure-Phase 2'') that has funding levels
comparable or larger than those for Phase 1 (i.e., including the $168
million accepted by the District in March 2022) and that CARB's
emission reduction estimates of 4.9 tpd NOX and 0.5 tpd
direct PM2.5 by 2025, per the 2021 Progress Report, are
reasonable and supported by identified or reasonably anticipated
funding.
    However, we have not yet taken final action on the NRCS portion of
the Agricultural Equipment Incentive Measure-Phase 1 and, for this
proposed rule, do not rely on the estimated emission reductions for
that portion of the Agricultural Equipment Incentive Measure-Phase 1
(i.e., 0.64 tpd NOX and 0.04 tpd direct PM2.5).
Looking forward in time, this suggests some uncertainty regarding
creditability of emission reductions from any portion of a Phase 2
agricultural equipment incentive measure that may be implemented
through the NRCS program.
    Furthermore, for any measure, to the extent that CARB or the
District assumed a 100% rule effectiveness rate where the EPA is not
able to confirm and approve such a rate, further discounts to the
emission reductions estimated may be warranted in certain cases.\203\
Accordingly, the overall remaining NOX commitment could be
larger than 6.01 tpd and the anticipated

excess emission reductions for direct PM2.5 could be smaller
than 0.86 tpd.
---------------------------------------------------------------------------

    \203\ For example, the District originally sought SIP credit of
0.26 tpd direct PM2.5 emission reductions from Rule 4901
and the EPA is proposing 0.2 tpd direct PM2.5 based on a
75% rule effectiveness rate. Similarly, CARB and the District sought
SIP credit of 1.04 tpd NOX and 1.54 tpd direct
PM2.5 emission reductions from the Agricultural Burning
Phase-out Measure and the EPA is proposing 0.83 tpd NOX
and 1.23 tpd direct PM2.5 based on an 80% rule
effectiveness rate.
---------------------------------------------------------------------------

    Notwithstanding some uncertainty as to the scale of emission
reductions from the Heavy-Duty I/M and the Agricultural Equipment
Incentive Measures (i.e., assuming that the additional measures with
discrete emission reduction estimates in the 2021 Progress Report
achieve their respective emission reductions), there remains at least
6.65 tpd NOX and 0.03 tpd direct PM2.5 in CARB's
commitment for which the record does not contain a specific and
plausible strategy to achieve. In our 2021 Proposed Rule we discussed
two possible ways that CARB could fill this gap: (1) additional
reductions from committed or substitute measures named by CARB, and (2)
a hypothetical inter-pollutant trading of excess direct
PM2.5 emission reductions by the District for any shortfall
in NOX emission reductions by CARB. The Ninth Circuit
Memorandum Opinion has established that these concepts in the absence
of a specific SIP revision are too speculative and do not constitute a
``plausible strategy'' for achieving this portion of the commitment.
    With respect to additional reductions from committed measures, in
the 2021 Proposed Rule, we explored potential reductions from two
incentive-based measures: Accelerated Turnover of Trucks and Buses
Incentive Projects, and Accelerated Turnover of Off-road Equipment
Incentive Projects.\204\ CARB initially estimated that they would
achieve 8 tpd NOX reductions from Accelerated Turnover of
Trucks and Buses Incentive Projects, and 1.5 tpd NOX
reductions from Accelerated Turnover of Off-road Equipment Incentive
Projects.\205\ However, CARB did not propose a measure to its board for
either measure by 2021, as it had committed to do, nor to our knowledge
has CARB started the public process for enforceable measures to be
submitted to the EPA for inclusion as control measures in the
California SIP.
---------------------------------------------------------------------------

    \204\ 86 FR 74310, 74335.
    \205\ Valley State SIP Strategy, Table 7.
---------------------------------------------------------------------------

    In the 2021 Progress Report, CARB acknowledged that many of the
project lives do not span the attainment year \206\ and, thus, while
these projects accelerate emission reductions and benefit communities
in the SJV, the projects that qualify for SIP credit may be limited for
the purposes of the 2012 annual PM2.5 NAAQS Serious area
attainment demonstration. In our 2021 Proposed Rule, we acknowledged
these weaknesses in these incentive programs, but we nonetheless
assumed that these measures may ultimately result in SIP-creditable
emission reductions for a portion of the combined 9.5 tpd
NOX.\207\ In light of the Ninth Circuit Memorandum Opinion,
the EPA does not consider it appropriate to rely on reductions that
have been rendered substantially less likely to occur by the State's
update indicating that few emissions from these projects may be
creditable.
---------------------------------------------------------------------------

    \206\ 2021 Progress Report at 24 and 32. Generally, mobile
source incentive projects implemented under the Carl Moyer program
are under contract only during the ``project life'' and may not be
credited with SIP emission reductions after the project life ends.
EPA Region IX ``Technical Support Document for EPA's Rulemaking for
the California State Implementation Plan California Air Resources
Board Resolution 19-26 San Joaquin Valley Agricultural Equipment
Incentive Measure,'' February 2020, 12-13.
    \207\ 86 FR 74310, 74335.
---------------------------------------------------------------------------

    Furthermore, while the State continues to invest heavily in the
replacement of older, dirty heavy-duty vehicles and equipment on a
State-wide basis,\208\ we are not aware of a document that identifies
specific funding amounts applied to the replacement of such equipment
in the SJV within the specific timeline of the Plan's demonstration of
attainment of the 2012 annual PM2.5 NAAQS by December 31,
2025. In brief, the amount of funding that is specific to the SJV for
these two measures for purposes of attainment of the 2012 annual
PM2.5 NAAQS is unclear, and this renders more speculative at
least a portion of the large scale of NOX emission
reductions originally anticipated.\209\
---------------------------------------------------------------------------

    \208\ See, e.g., CARB, ``Proposed Fiscal Year 2021-22 Funding
Plan for Clean Transportation Incentives, Appendix D: Long-Term
Heavy-Duty Investment Strategy,'' release date October 8, 2021.
    \209\ The EPA also notes that, for regulatory measures that have
large estimated emission reductions, rather than incentive-based
measures, CARB estimated that its Low-Emission Diesel Fuel
Requirement would achieve an additional 1 tpd NOX and 0.1
tpd direct PM2.5 reductions. However, without near-term
adoption and submission, its associated emission reductions may not
be creditable towards the aggregate tonnage commitment for 2025.
---------------------------------------------------------------------------

    With respect to substitute measures under development, CARB points
to the In-Use Locomotive Rule (and estimates emission reductions of
1.14 tpd NOX and 0.03 tpd direct PM2.5 by 2025 in
the SJV), which is slated for 2022 Board consideration.\210\ However,
as noted in our 2021 Proposed Rule,\211\ given the complexities
involved in regulating locomotive emissions, we have conservatively
excluded from our analysis the emission reduction estimates in the 2021
Progress Report for CARB's In-Use Locomotive Measure.
---------------------------------------------------------------------------

    \210\ 2021 Progress Report, 20-21. Additional information on
CARB's regulatory concepts for the In-Use Locomotive Measure are
available at: https://ww2.arb.ca.gov/our-work/programs/reducing-rail-emissions-california/locomotives-and-railyards-meetings-workshops.
    \211\ 86 FR 74310, 74334, fn. 228.
---------------------------------------------------------------------------

    In addition, CARB has identified further measures that were not
included in the original control measure commitments that may provide
emission reductions toward CARB's aggregate tonnage commitments.\212\
These measures include Cargo Handling Equipment Registration,
Construction and Mining Equipment Measure, and Co-Benefits from the
Climate Program. However, we do not have information as to what these
measures might entail, when the State may adopt or implement them, and
what scale of emission reductions they could potentially achieve.
---------------------------------------------------------------------------

    \212\ CARB, ``SJV PM2.5 SIP Measure Tracking,''
September 2021, 3. Available at: https://ww2.arb.ca.gov/resources/documents/2018-san-joaquin-valley-pm25-plan.
---------------------------------------------------------------------------

    Based on the lack of information on funding and process for heavy-
duty and off-road equipment incentive-based measures and the lack of
information on other potential substitute measures, such as a
Construction and Mining Equipment Measure, and in light of the Ninth
Circuit Memorandum Opinion, we have reconsidered our evaluation of this
prospect and now propose that there is not sufficient evidence to show
that the Valley State SIP Strategy contains a ``plausible strategy'' to
achieve the remaining NOX and direct PM2.5
emission reductions needed for attainment.
    The other approach that the 2021 Proposed Rule discusses for
filling the gap in CARB's strategy for achieving its commitment is
based on a hypothetical future SIP revision. In the 2021 Progress
Report, CARB and the District provided additional emissions analysis to
assess how excess direct PM2.5 emission reductions could be
converted to equivalent NOX emission reductions using an
inter-pollutant trading ratio rooted in the sensitivity analyses of the
2018 PM2.5 Plan.\213\ CARB and the District have not
formally submitted this analysis as a SIP revision to the EPA or
requested that the EPA apply such inter-pollutant trading for purposes
of fulfilling the aggregate tonnage commitments through an equivalent
amount of emission reductions.
---------------------------------------------------------------------------

    \213\ 2021 Progress Report, Table 4 and 33-37.
---------------------------------------------------------------------------

    Consistent with past EPA action on PM2.5 planning SIP
submissions for the SJV,\214\ where the State submits a SIP

revision that would substitute reductions in one pollutant to achieve a
tonnage commitment concerning a different pollutant (e.g., substituting
excess direct PM2.5 reductions to satisfy a NOX
reduction commitment), it must include an appropriate inter-pollutant
trading (IPT) ratio and the technical basis for such ratio in the plan
submission itself, along with the requisite public process. The EPA
will review any such IPT ratio and its bases before approving or
disapproving any such SIP revision. The possibility of a future SIP
submission discussing IPT does not constitute a ``plausible strategy''
for achieving reductions that are modeled to result in attainment.
Thus, at this time, we are not proposing to approve any particular
inter-pollutant trading approach for purposes of meeting the aggregate
tonnage commitments, nor applying any excess reductions of one
pollutant towards fulfilling a portion of committed reductions of the
other pollutant.
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    \214\ For example, the EPA has approved an inter-pollutant
trading mechanism for use in transportation conformity analyses for
the 2006 24-hour PM2.5 NAAQS. 85 FR 44192, 44204. In that
same final rule, the EPA approved the State's demonstration that it
had fulfilled prior aggregate tonnage commitments, in part, by using
an inter-pollutant trading approach that the EPA found adequate. 85
FR 44192, 44205; see also proposed rule at 85 FR 17382, 17406-17407
and associated EPA's General Evaluation TSD, Table III-C and section
IV.
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    The additional evaluation we have discussed herein as part of our
reconsideration of the State's enforceable commitments requires us to
re-evaluate the EPA's three-factor test for enforceable commitments.
Based on our reconsideration, and consistent with the Ninth Circuit
Memorandum Opinion, we retain our proposed findings that the State's
commitments meet the first factor (the commitment represents a limited
portion of the required reductions, i.e., 13.8% of the NOX
and 8.0% of the direct PM2.5 emission reductions necessary
to attain) and the third factor (the commitment is for a reasonable and
appropriate timeframe) of the three-factor test. However, we now
propose that the State's commitments do not meet the second factor
(regarding the State's capability to fulfill its commitments). Our
analysis and findings for the first and third factors are presented in
section IV.F.3.e of the 2021 Proposed Rule. We provide our reconsidered
evaluation of the second factor as follows in this proposed rule.
    As the EPA noted in our 2021 Proposed Rule, CARB and the District
have been capable of developing and adopting many of the regulatory
measures listed in their respective control measure commitments.
However, the question before us more precisely is whether such
substantial progress, coupled with the strategy submitted by the State
for achieving the remaining reductions which the State has modeled as
leading to attainment, is sufficient to show that the State is capable
of fulfilling its entire aggregate tonnage commitments by 2025. Several
components of our reconsideration suggest that the State may not be
capable of fulfilling the entire aggregate tonnage commitment,
particularly with respect to NOX emission reductions from
additional CARB measures.
    First, in terms of additional measures for which CARB and the
District provided updated emission reduction estimates, we have given
additional consideration to the evidence of emission reductions for two
source categories that have large emission reduction estimates: Heavy-
Duty I/M and the Agricultural Equipment Incentive Measures. For Heavy-
Duty I/M, CARB has not provided to the EPA a sufficient basis for its
increase in estimated emission reductions from 6.8 tpd NOX
to 14.7 tpd NOX, where the 14.7 tpd reduction amounts to
7.1% of the total emission reductions modeled for attainment of the
2012 annual PM2.5 NAAQS. Although the EPA is confident,
based on its review, that emission reductions are available in this
category, and that the State is capable of achieving some amount of
reductions, the State has not sufficiently supported its assertion that
it is capable of achieving 14.7 tpd of NOX and 0.03 tpd of
direct PM2.5. As discussed above, due to uncertainty
surrounding the NRCS portion of the Agricultural Equipment Incentive
Measure-Phase 1, we are not relying on reductions from that portion of
the rule, and the creditability of any NRCS portion of a potential
future Phase 2 has not been established.
    Furthermore, for any measure, to the extent that CARB or the
District assumed a 100% rule effectiveness rate where the EPA is not
able to confirm and approve such a rate, further discounts to the
emission reduction estimates may be warranted in certain cases.
    Accordingly, the overall remaining NOX commitment could
be larger than 6.01 tpd and the anticipated excess emission reductions
for direct PM2.5 could be smaller than 0.86 tpd.
    Second, even if the EPA were to assume maximum credit for the
additional measures for which CARB and the District provided updated
emission reduction estimates, CARB, in combination with the District,
would still need emission reductions of at least 6 tpd NOX
to fulfill its commitments.\215\ Moreover, the reductions from CARB's
remaining incentive measures for Heavy-Duty vehicles and off-road
equipment appear to be limited relative to the combined emission
reduction estimate of 9.5 tpd NOX in the Plan. Without
documentation supporting the funding amounts to be applied in the SJV
within the timeline of the 2012 annual PM2.5 NAAQS portion
of the SJV PM2.5 Plan, it is not clear that the full amount
of these estimated reductions is supported by a ``plausible strategy''
to achieve them, as required in the Ninth Circuit Memorandum Opinion.
In addition, the identified substitute measures lack sufficient detail
to provide support for making up for NOX emission reduction
shortfalls from CARB's control measure commitments.
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    \215\ As noted in this proposed rule, if the EPA were to assume
credit for emission reductions from the additional District
measures, the District would have exceeded its aggregate tonnage
commitments by 0.64 tpd NOX and 0.89 tpd direct
PM2.5.
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    Given the gap between the reductions needed and the reductions for
which CARB and the District have presented a non-speculative plan for
achieving, we now propose that the State has not demonstrated that it
is capable of fulfilling the remaining aggregate tonnage commitments
necessary to attain the 2012 annual PM2.5 NAAQS in the SJV
by December 31, 2025, and therefore find that the SJV PM2.5
Plan does not meet the second factor of our three-factor test for
enforceable commitments.
b. Attainment Demonstration
    Based on our reconsideration of the Plan's enforceable commitments
described in section II.C.3.a of this proposed rule, and our
reconsideration of the Plan's BACM demonstration for described in
section II.B, we now propose to disapprove the SJV PM2.5
Plan's modeled attainment demonstration for the 2012 annual
PM2.5 NAAQS in the SJV by December 31, 2025. We discuss the
interrelationship of these nonattainment plan elements as follows.
    Regarding enforceable commitments, CAA section 110(a)(2)(A)
provides that each SIP ``shall include enforceable emission limitations
and other control measures, means or techniques . . . as well as
schedules and timetables for compliance, as may be necessary or
appropriate to meet the applicable requirements of [the Act].'' Section
172(c)(6) of the Act, which applies to nonattainment SIPs, is virtually
identical to section 110(a)(2)(A). The EPA interprets the CAA to allow
for approval of enforceable commitments that are limited in scope,
where circumstances exist that warrant the use of such commitments in
place of

adopted and submitted measures, and considers three factors in
determining whether to approve the enforceable commitment.
    Given our proposed finding above that the State has not met the
second factor of the EPA's three-factor test (i.e., whether the State
is capable of fulfilling its commitment), the State is left with a gap
between the reductions that it has modeled as necessary for attainment,
and the reductions that the EPA may count as constituting the State's
control plan. Therefore, the EPA proposes that the State's control
strategy does not include sufficient enforceable measures, pursuant to
CAA sections 110(a)(2)(A) and 172(c)(6), to achieve the necessary
emission reductions to attain the 2012 annual PM2.5 NAAQS in
the SJV by December 31, 2025.
    The lack of an approved control plan to achieve the reductions
necessary to attain by 2025 is sufficient on its own to compel
disapproval of the attainment demonstration. However, even if the
State's control plan was sufficient to lead to attainment in 2025, the
Public Justice Comment Letter and our reconsidered BACM analysis in
section II.B of this notice raise additional issues regarding the
sufficiency of the modeled attainment demonstration.
    The State's attainment demonstration identifies the Bakersfield-
Planz monitor as the design value monitor, and models this monitor as
achieving the 12.0 [micro]g/m\3\ concentration necessary for attainment
in 2025.\216\ The State's submission also indicates that the
Bakersfield-Planz monitor is modeled to read 12.1 [micro]g/m\3\ in
2024.\217\ This represents a very narrow margin between modeled
attainment in 2024 and 2025. In light of the Act's requirement to
demonstrate attainment by the most expeditious date practicable, in
order for the EPA to approve the Plan's demonstration that the area
will attain by 2025, the State must also demonstrate that attainment by
an earlier date is not practicable.
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    \216\ 2018 PM2.5 Plan, App. K, Table 39.
    \217\ Id. at Table 33.
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    As explained in section II.B of this notice, the EPA now proposes
to find that the State has not sufficiently demonstrated that it has
implemented BACM for all necessary categories of sources. Most notably,
the State has not sufficiently evaluated the amount of ammonia
reductions that may be available. In light of the very small (0.1
[micro]g/m\3\) gap between attaining in 2024 and 2025, and the State's
sensitivity modeling in its precursor demonstration indicating that a
30% reduction in ammonia would reduce annual PM2.5
concentrations at the Bakersfield-Planz monitor by 0.12 [micro]g/m\3\
and a 70% reduction would reduce annual PM2.5 concentrations
at the Bakersfield-Planz monitor by 0.36 [micro]g/m\3\, the State has
not demonstrated that reductions from sources identified in section
II.B could not expedite attainment.\218\ As a result, even if the
State's control plan was sufficiently concrete that the EPA could
credit all reductions of NOX and direct PM2.5
that the State indicated that it intended to use to fulfill its
aggregate commitments, the State is still required to demonstrate that
the selected attainment year (e.g., 2025) is as expeditious as
practicable considering potential emission reductions from all plan
precursors, including ammonia.
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    \218\ See 2018 PM2.5 Plan, App. G, tables 4 through
7.
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    The EPA emphasizes that it is stating both that the Plan does not
demonstrate that the SJV will attain by 2025 and that the State has not
demonstrated that it could not attain sooner than 2025. These findings
are not in tension with one another. Under the Act, the State must
demonstrate that its control plan will be sufficient to attain the
NAAQS, and to attain the NAAQS by the most expeditious date
practicable. The State's failure to demonstrate that it could not
attain sooner than 2025 is not inconsistent with the State also having
other analytical or substantive flaws in its control plan to attain by
2025. The EPA is not proposing to find that the SJV can practicably
attain by 2024, nor is the EPA proposing to find that the SJV could not
possibly attain by 2025. Instead, the EPA is proposing, in light of the
uncertainty regarding ammonia controls, to find that the State has
failed to demonstrate that it could not practicably attain before 2025,
and in light of identified deficiencies in the control plan, that the
State's control strategy for attaining by 2025 is flawed.
    Furthermore, for the 1997 annual PM2.5 NAAQS, on
November 8, 2021, the State submitted the ``Attainment Plan Revision
for the 1997 Annual PM2.5 Standard,'' which was adopted by
the District on August 19, 2021, and by CARB on September 23, 2021
(``15 [micro]g/m\3\ SIP Revision''). In that submission, the State
updated its prior air quality modeling to account for more recent
monitored air quality data. Specifically, the State estimated 2023
annual average concentrations starting from a 2018 monitored base year
(i.e., rather than a 2013 base year, in order to reflect updated
monitored air quality data), and applied updated, scaled relative
response factors (RRFs) to reflect emissions changes between 2018 and
2023.\219\ Because this scaling indicated a significant change in the
modeling results for the 1997 annual PM2.5 NAAQS, and the
modeling for the 2012 annual PM2.5 NAAQS relies on many of
the same models and assumptions, the result of the scaling analysis
introduces additional uncertainty to the modeled attainment
demonstration for the 2012 PM2.5 NAAQS. Accordingly, we
recommend updated modeling analysis for the 2012 annual
PM2.5 NAAQS.
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    \219\ 15 [micro]g/m\3\ SIP Revision, Ch. 5, 5-9 to 5-12. See
also 15 [micro]g/m\3\ SIP Revision, App. K, 64-65. In the 15
[micro]g/m\3\ SIP Revision, the State used existing modeling runs
for 2020 and 2024 to compute RRFs for each PM2.5
component using the standard approach recommended in the EPA's
Modeling Guidance. Those RRFs were then scaled to reflect emissions
changes between 2018 and 2023 to arrive at updated RRFs.
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    As a result of our proposed disapproval of the control plan and the
uncertainty regarding additional reductions that could be achieved by
further BACM/BACT level controls for all appropriate plan precursors
(particularly for ammonia), we now propose to disapprove the attainment
demonstration for the 2012 annual PM2.5 NAAQS.

D. Reasonable Further Progress Demonstration and Quantitative
Milestones

1. Summary of 2021 Proposed Rule
    In section IV.G of our 2021 Proposed Rule, the EPA described the
requirements for RFP and quantitative milestones for a Serious
PM2.5 nonattainment area, summarized the State's submission
in the 2018 PM2.5 Plan for the SJV, and presented our
evaluation thereof.\220\ We briefly summarize those components here and
rely on the more complete exposition in that proposed rule, except as
described in section II.D.2 of this proposed rule (i.e., the EPA's
reconsidered proposal for RFP and quantitative milestones).
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    \220\ 86 FR 74310, 74338-74345.
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    Regarding requirements, CAA section 172(c)(2) provides that all
nonattainment area plans shall require RFP toward attainment. In
addition, CAA section 189(c) requires that all PM2.5
nonattainment area plans contain quantitative milestones for purposes
of measuring RFP, as defined in CAA section 171(1), every three years
until the EPA redesignates the area to attainment. Section 171(1) of
the Act defines RFP as the annual incremental reductions in emissions
of the relevant air pollutant as are required by part D, title I of the
Act, or as may reasonably be required by the Administrator for the
purpose of ensuring attainment of the

NAAQS by the applicable attainment date.
    In addition to the EPA's longstanding guidance on the RFP
requirements for PM, the Agency has established specific regulatory
requirements for the PM2.5 NAAQS in the PM2.5 SIP
Requirements Rule for purposes of satisfying the Act's RFP requirements
and provided related guidance in the preamble to the rule.
Specifically, under the PM2.5 SIP Requirements Rule, for a
PM2.5 attainment plan a State must include an RFP analysis
that includes, at minimum, the following four components: (1) an
implementation schedule for control measures; (2) RFP projected
emissions for direct PM2.5 and all PM2.5 plan
precursors for each applicable milestone year, based on the anticipated
control measure implementation schedule; (3) a demonstration that the
control strategy and implementation schedule will achieve reasonable
progress toward attainment between the base year and the attainment
year; and (4) a demonstration that by the end of the calendar year for
each triennial milestone date for the area, pollutant emissions will be
at levels that reflect either generally linear progress or stepwise
progress in reducing emissions on an annual basis between the base year
and the attainment year.\221\ Additionally, states should estimate the
RFP projected emissions for each quantitative milestone year by sector
on a pollutant-by-pollutant basis.\222\
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    \221\ 40 CFR 51.1012(a).
    \222\ 81 FR 58010, 58056.
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    Section 189(c) of the Act requires that PM2.5 attainment
plans include quantitative milestones that demonstrate RFP. The purpose
of the quantitative milestones is to allow periodic evaluation of the
State's progress towards attainment of the PM2.5 NAAQS in
the area consistent with RFP requirements. Because RFP is an annual
emission reduction requirement and the quantitative milestones are to
be achieved every three years, when a State demonstrates compliance
with the quantitative milestone requirement, it should also demonstrate
that RFP has been achieved during each of the relevant three years.
Quantitative milestones should provide an objective means to evaluate
progress toward attainment meaningfully, e.g., through imposition of
emissions controls in the attainment plan and the requirement to
quantify those required emissions reductions on the schedule approved
by the EPA and thus required to meet RFP.
    As we noted in the 2021 Proposed Rule, the CAA does not specify the
starting point for counting the three-year periods for quantitative
milestones under CAA section 189(c). In the General Preamble and
General Preamble Addendum, the EPA interpreted the CAA to require that
the starting point for the first three-year period be the due date for
the Moderate area plan submission.\223\ Consistent with this
longstanding interpretation of the Act, the PM2.5 SIP
Requirements Rule requires that each plan for a Serious
PM2.5 nonattainment area that demonstrates attainment by the
end of the 10th calendar year following the date of designation contain
quantitative milestones to be achieved no later than milestone dates
7.5 years and 10.5 years from the date of designation of the area.\224\
The 2018 PM2.5 Plan includes a demonstration designed to
show attainment by the end of the 10th calendar year following
designations (i.e., December 31, 2025). Because the EPA designated the
SJV nonattainment for the 2012 annual PM2.5 NAAQS effective
April 15, 2015,\225\ the applicable quantitative milestone dates for
purposes of the submitted Serious area plan for this NAAQS in the SJV
are October 15, 2022, and October 15, 2025.
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    \223\ General Preamble, 13539 and General Preamble Addendum,
42016.
    \224\ 40 CFR 51.1013(a)(2)(i).
    \225\ 80 FR 2206.
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    Quantitative milestones must provide for objective evaluation of
reasonable further progress toward timely attainment of the
PM2.5 NAAQS in the area and include, at minimum, a metric
for tracking progress achieved in implementing SIP control measures,
including BACM and BACT, by each milestone date.\226\
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    \226\ 81 FR 58010, 58064 and 58092.
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    The State presents its RFP demonstration and quantitative
milestones for the 2012 annual PM2.5 NAAQS in Appendix H of
the 2018 PM2.5 Plan. Following the identification of a
transcription error in the RFP tables of Appendix H, the State
submitted a revised version of Appendix H that corrects the
transcription error and provides additional information on the RFP
demonstration.\227\ Given the State's conclusions that ammonia,
SOX, and VOC emissions do not contribute significantly to
PM2.5 levels that exceed the 2012 annual PM2.5
NAAQS in the SJV, the RFP demonstration provided by the State only
addresses emissions of direct PM2.5 and NOX.\228\
Similarly, the State developed quantitative milestones based upon the
Plan's control measure strategy to achieve emission reductions of
direct PM2.5 and NOX.\229\
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    \227\ Appendix H to 2018 PM2.5 Plan, submitted
February 11, 2020, via the EPA State Planning Electronic
Collaboration System. This revised version of Appendix H replaces
the version submitted with the 2018 PM2.5 Plan on May 10,
2019. All references to Appendix H in this proposed rule are to the
revised version of Appendix H submitted February 11, 2020.
    \228\ 2018 PM2.5 Plan, App. H, H-1.
    \229\ Id. at App. H, H-23 to H-24 (for CARB milestones) and H-20
to H-22 (for District milestones).
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    For the 2012 annual PM2.5 NAAQS, the RFP demonstration
in the Plan follows a stepwise approach due to the time required for
CARB and the District ``to amend rules, develop programs, and implement
the emission reduction measures.'' \230\ The revised Appendix H
provides clarifying information on the RFP demonstration, including
additional information to justify the Plan's stepwise approach to
demonstrating RFP. This clarifying information did not affect the