[Federal Register: October 30, 2009 (Volume 74, Number 209)]
[Rules and Regulations]
[Page 56259-56519]
[DOCID:fr30oc09-16]

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Part II

Environmental Protection Agency

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40 CFR Parts 86, 87, 89 et al.

 Mandatory Reporting of Greenhouse Gases; Final Rule

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 86, 87, 89, 90, 94, 98, 1033, 1039, 1042, 1045, 1048,
1051, 1054, 1065

[EPA-HQ-OAR-2008-0508; FRL-8963-5]
RIN 2060-A079

Mandatory Reporting of Greenhouse Gases

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is promulgating a regulation to require reporting of
greenhouse gas emissions from all sectors of the economy. The final
rule applies to fossil fuel suppliers and industrial gas suppliers,
direct greenhouse gas emitters and manufacturers of heavy-duty and off-
road vehicles and engines. The rule does not require control of
greenhouse gases, rather it requires only that sources above certain
threshold levels monitor and report emissions.

DATES: The final rule is effective on December 29, 2009. The
incorporation by reference of certain publications listed in the rule
is approved by the Director of the Federal Register as of December 29,
2009.

ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-HQ-OAR-2008-0508. All documents in the docket are listed on the
www.regulations.gov Web site. Although listed in the index, some
information is not publicly available, e.g., confidential business
information (CBI) or other information whose disclosure is restricted
by statute. Certain other material, such as copyrighted material, is
not placed on the Internet and will be publicly available only in hard
copy form. Publicly available docket materials are available either
electronically through www.regulations.gov or in hard copy at EPA's
Docket Center, Public Reading Room, EPA West Building, Room 3334, 1301
Constitution Avenue, NW., Washington, DC 20004. This Docket Facility is
open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding
legal holidays. The telephone number for the Public Reading Room is
(202) 566-1744, and the telephone number for the Air Docket is (202)
566-1742.

FOR FURTHER INFORMATION CONTACT: Carole Cook, Climate Change Division,
Office of Atmospheric Programs (MC-6207J), Environmental Protection
Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone
number:<PHONE_NUMBER>; fax number:<PHONE_NUMBER>; e-mail address:
<EMAIL_ADDRESS>For technical information and implementation
materials, please go to the Web site www.epa.gov/climatechange/
emissions/ghgrulemaking.html. You may also contact the Greenhouse Gas
Reporting Rule Hotline at telephone number:<PHONE_NUMBER>; or e-mail:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:
    Regulated Entities. The Administrator determined that this action
is subject to the provisions of Clean Air Act (CAA) section 307(d). See
CAA section 307(d)(1)(V) (the provisions of section 307(d) apply to
``such other actions as the Administrator may determine.''). The final
rule affects fuel and chemicals suppliers, direct emitters of
greenhouse gases (GHGs) and manufacturers of mobile sources and
engines. Regulated categories and entities include those listed in
Table 1 of this preamble:

           Table 1--Examples of Affected Entities by Category
------------------------------------------------------------------------
                                                   Examples of affected
            Category                  NAICS             facilities
------------------------------------------------------------------------
General Stationary Fuel          ..............  Facilities operating
 Combustion Sources.                              boilers, process
                                                  heaters, incinerators,
                                                  turbines, and internal
                                                  combustion engines:
                                            211  Extractors of crude
                                                  petroleum and natural
                                                  gas.
                                            321  Manufacturers of lumber
                                                  and wood products.
                                            322  Pulp and paper mills.
                                            325  Chemical manufacturers.
                                            324  Petroleum refineries,
                                                  and manufacturers of
                                                  coal products.
                                  316, 326, 339  Manufacturers of rubber
                                                  and miscellaneous
                                                  plastic products.
                                            331  Steel works, blast
                                                  furnaces.
                                            332  Electroplating,
                                                  plating, polishing,
                                                  anodizing, and
                                                  coloring.
                                            336  Manufacturers of motor
                                                  vehicle parts and
                                                  accessories.
                                            221  Electric, gas, and
                                                  sanitary services.
                                            622  Health services.
                                            611  Educational services.
Electricity Generation.........          221112  Fossil-fuel fired
                                                  electric generating
                                                  units, including units
                                                  owned by Federal and
                                                  municipal governments
                                                  and units located in
                                                  Indian Country.
Adipic Acid Production.........          325199  Adipic acid
                                                  manufacturing
                                                  facilities.
Aluminum Production............          331312  Primary Aluminum
                                                  production facilities.
Ammonia Manufacturing..........          325311  Anhydrous and aqueous
                                                  ammonia manufacturing
                                                  facilities.
Cement Production..............          327310  Portland Cement
                                                  manufacturing plants.
Ferroalloy Production..........          331112  Ferroalloys
                                                  manufacturing
                                                  facilities.
Glass Production...............          327211  Flat glass
                                                  manufacturing
                                                  facilities.
                                         327213  Glass container
                                                  manufacturing
                                                  facilities.
                                         327212  Other pressed and blown
                                                  glass and glassware
                                                  manufacturing
                                                  facilities.
HCFC-22 Production and HFC-23            325120  Chlorodifluoromethane
 Destruction.                                     manufacturing
                                                  facilities.
Hydrogen Production............          325120  Hydrogen manufacturing
                                                  facilities.
Iron and Steel Production......          331111  Integrated iron and
                                                  steel mills, steel
                                                  companies, sinter
                                                  plants, blast
                                                  furnaces, basic oxygen
                                                  process furnace shops.
Lead Production................          331419  Primary lead smelting
                                                  and refining
                                                  facilities.
                                         331492  Secondary lead smelting
                                                  and refining
                                                  facilities.
Lime Production................          327410  Calcium oxide, calcium
                                                  hydroxide, dolomitic
                                                  hydrates manufacturing
                                                  facilities.
Nitric Acid Production.........          325311  Nitric acid
                                                  manufacturing
                                                  facilities.
Petrochemical Production.......           32511  Ethylene dichloride
                                                  manufacturing
                                                  facilities.
                                         325199  Acrylonitrile, ethylene
                                                  oxide, methanol
                                                  manufacturing
                                                  facilities.
                                         325110  Ethylene manufacturing
                                                  facilities.

                                         325182  Carbon black
                                                  manufacturing
                                                  facilities.
Petroleum Refineries...........          324110  Petroleum refineries.
Phosphoric Acid Production.....          325312  Phosphoric acid
                                                  manufacturing
                                                  facilities.
Pulp and Paper Manufacturing...          322110  Pulp mills.
                                         322121  Paper mills.
                                         322130  Paperboard mills.
Silicon Carbide Production.....          327910  Silicon carbide
                                                  abrasives
                                                  manufacturing
                                                  facilities.
Soda Ash Manufacturing.........          325181  Alkalies and chlorine
                                                  manufacturing
                                                  facilities.
                                         212391  Soda ash, natural,
                                                  mining and/or
                                                  beneficiation.
Titanium Dioxide Production....          325188  Titanium dioxide
                                                  manufacturing
                                                  facilities.
Zinc Production................          331419  Primary zinc refining
                                                  facilities.
                                         331492  Zinc dust reclaiming
                                                  facilities, recovering
                                                  from scrap and/or
                                                  alloying purchased
                                                  metals.
Municipal Solid Waste Landfills          562212  Solid waste landfills.
                                         221320  Sewage treatment
                                                  facilities.
Manure Management..............          112111  Beef cattle feedlots.
                                         112120  Dairy cattle and milk
                                                  production facilities.
                                         112210  Hog and pig farms.
                                         112310  Chicken egg production
                                                  facilities.
                                         112330  Turkey Production.
                                         112320  Broilers and Other Meat
                                                  type Chicken
                                                  Production.
Suppliers of Coal Based Liquids          211111  Coal liquefaction at
 Fuels.                                           mine sites.
Suppliers of Petroleum Products          324110  Petroleum refineries.
Suppliers of Natural Gas and             221210  Natural gas
 NGLs.                                            distribution
                                                  facilities.
                                         211112  Natural gas liquid
                                                  extraction facilities.
Suppliers of Industrial GHGs...          325120  Industrial gas
                                                  manufacturing
                                                  facilities.
Suppliers of Carbon Dioxide              325120  Industrial gas
 (CO2).                                           manufacturing
                                                  facilities.
Mobile Sources.................          333618  Heavy-duty, non-road,
                                                  aircraft, locomotive,
                                                  and marine diesel
                                                  engine manufacturing.
                                         336120  Heavy-duty vehicle
                                                  manufacturing
                                                  facilities.
                                         336312  Small non-road, and
                                                  marine spark-ignition
                                                  engine manufacturing
                                                  facilities.
                                         336999  Personal watercraft
                                                  manufacturing
                                                  facilities.
                                         336991  Motorcycle
                                                  manufacturing
                                                  facilities.
------------------------------------------------------------------------

    Table 1 of this preamble is not intended to be exhaustive, but
rather provides a guide for readers regarding facilities likely to be
affected by this action. Table 1 of this preamble lists the types of
facilities that EPA is now aware could be potentially affected by the
reporting requirements. Other types of facilities and suppliers not
listed in the table could also be subject to reporting requirements. To
determine whether you are affected by this action, you should carefully
examine the applicability criteria found in 40 CFR part 98, subpart A
or the relevant criteria in the sections related to manufacturers of
heavy-duty and off-road vehicles and engines. If you have questions
regarding the applicability of this action to a particular facility,
consult the person listed in the preceding FOR FURTHER INFORMATION
CONTACT section.
    Many facilities that are affected by the final rule have GHG
emissions from multiple source categories listed in Table 1 of this
preamble. Table 2 of this preamble has been developed as a guide to
help potential reporters subject to the mandatory reporting rule
identify the source categories (by subpart) that they may need to (1)
consider in their facility applicability determination, and (2) include
in their reporting. For each source category, activity, or facility
type (e.g., electricity generation, aluminum production), Table 2 of
this preamble identifies the subparts that are likely to be relevant.
The table should only be seen as a guide. Additional subparts may be
relevant for a given reporter. Similarly, not all listed subparts are
relevant for all reporters.

            Table 2--Source Categories and Relevant Subparts
------------------------------------------------------------------------
                                          Other subparts recommended for
  Source category (and main applicable         review to determine
                subpart)                          applicability
------------------------------------------------------------------------
General Stationary Fuel Combustion
 Sources.
Electricity Generation.................  General Stationary Fuel
                                          Combustion, Suppliers of CO2.
Adipic Acid Production.................  General Stationary Fuel
                                          Combustion.
Aluminum Production....................  General Stationary Fuel
                                          Combustion.
Ammonia Manufacturing..................  General Stationary Fuel
                                          Combustion, Hydrogen, Nitric
                                          Acid, Petroleum Refineries,
                                          Suppliers of CO2.
Cement Production......................  General Stationary Fuel
                                          Combustion, Suppliers of CO2.
Ferroalloy Production..................  General Stationary Fuel
                                          Combustion.
Glass Production.......................  General Stationary Fuel
                                          Combustion.
HCFC-22 Production and HFC-23            General Stationary Fuel
 Destruction.                             Combustion.
Hydrogen Production....................  General Stationary Fuel
                                          Combustion, Petrochemicals,
                                          Petroleum Refineries,
                                          Suppliers of Industrial GHGs,
                                          Suppliers of CO2.
Iron and Steel Production..............  General Stationary Fuel
                                          Combustion, Suppliers of CO2.

Lead Production........................  General Stationary Fuel
                                          Combustion.
Lime Manufacturing.....................  General Stationary Fuel
                                          Combustion.
Nitric Acid Production.................  General Stationary Fuel
                                          Combustion, Adipic Acid.
Petrochemical Production...............  General Stationary Fuel
                                          Combustion, Ammonia, Petroleum
                                          Refineries.
Petroleum Refineries...................  General Stationary Fuel
                                          Combustion, Hydrogen,
                                          Suppliers of Petroleum
                                          Products.
Phosphoric Acid Production.............  General Stationary Fuel
                                          Combustion.
Pulp and Paper Manufacturing...........  General Stationary Fuel
                                          Combustion.
Silicon Carbide Production.............  General Stationary Fuel
                                          Combustion.
Soda Ash Manufacturing.................  General Stationary Fuel
                                          Combustion.
Titanium Dioxide Production............  General Stationary Fuel
                                          Combustion.
Zinc Production........................  General Stationary Fuel
                                          Combustion.
Municipal Solid Waste Landfills........  General Stationary Fuel
                                          Combustion.
Manure Management......................  General Stationary Fuel
                                          Combustion.
Suppliers of Coal-based Liquid Fuels...  Suppliers of Petroleum
                                          Products.
Suppliers of Petroleum Products........  General Stationary Fuel
                                          Combustion.
Suppliers of Natural Gas and NGLs......  General Stationary Fuel
                                          Combustion, Suppliers of CO2.
Suppliers of Industrial GHGs...........  General Stationary Fuel
                                          Combustion, Hydrogen
                                          Production, Suppliers of CO2.
Suppliers of Carbon Dioxide (CO2)......  General Stationary Fuel
                                          Combustion, Electricity
                                          Generation, Ammonia, Cement,
                                          Hydrogen, Iron and Steel,
                                          Suppliers of Industrial GHGs.
Mobile Sources.........................  General Stationary Fuel
                                          Combustion.
------------------------------------------------------------------------

    Judicial Review. Under section 307(b)(1) of the CAA, judicial
review of this final rule is available only by filing a petition for
review in the U.S. Court of Appeals for the District of Columbia
Circuit by December 29, 2009. Under CAA section 307(d)(7)(B), only an
objection to this final rule that was raised with reasonable
specificity during the period for public comment can be raised during
judicial review. This section also provides a mechanism for us to
convene a proceeding for reconsideration, ``[i]f the person raising an
objection can demonstrate to EPA that it was impracticable to raise
such objection within [the period for public comment] or if the grounds
for such objection arose after the period for public comment (but
within the time specified for judicial review) and if such objection is
of central relevance to the outcome of this rule.'' Any person seeking
to make such a demonstration to us should submit a Petition for
Reconsideration to the Office of the Administrator, Environmental
Protection Agency, Room 3000, Ariel Rios Building, 1200 Pennsylvania
Ave., NW., Washington, DC 20004, with a copy to the person listed in
the preceding FOR FURTHER INFORMATION CONTACT section, and the
Associate General Counsel for the Air and Radiation Law Office, Office
of General Counsel (Mail Code 2344A), Environmental Protection Agency,
1200 Pennsylvania Ave., NW., Washington, DC 20004. Note, under CAA
section 307(b)(2), the requirements established by this final rule may
not be challenged separately in any civil or criminal proceedings
brought by EPA to enforce these requirements.

    Acronyms and Abbreviations. The following acronyms and
abbreviations are used in this document.

ARP Acid Rain Program
ASME American Society of Mechanical Engineers
ASTM American Society for Testing and Materials
BLS Bureau of Labor Statistics
CAA Clean Air Act
CAFE Corporate Average Fuel Economy
CAIR Clean Air Interstate Rule
CARB California Air Resources Board
CBI confidential business information
CCAR California Climate Action Registry
CCS carbon capture and sequestration
CEMS continuous emission monitoring system(s)
cf cubic feet
CFCs chlorofluorocarbons
CFR Code of Federal Regulations
CH4 methane
CO2 carbon dioxide
CO2e CO2-equivalent
COD chemical oxygen demand
DOE U.S. Department of Energy
DOT U.S. Department of Transportation
EAF electric arc furnace
ECOS Environmental Council of the States
EGUs electric generating units
EIA Energy Information Administration
EO Executive Order
EOR enhanced oil recovery
EPA U.S. Environmental Protection Agency
FY2008 fiscal year 2008
GHG greenhouse gas
GWP global warming potential
HCFC-22 chlorodifluoromethane (or CHClF2)
HCFCs hydrochlorofluorocarbons
HFC-23 trifluoromethane (or CHF3)
HFCs hydrofluorocarbons
HFEs hydrofluorinated ethers
HHV higher heating value
ICR information collection request
IPCC Intergovernmental Panel on Climate Change
kg kilograms
LDCs local natural gas distribution companies
LMP lime manufacturing plants
mmBtu/hr millions British thermal units per hour
MSW municipal solid waste
MW megawatts
MY mileage year
N2O nitrous oxide
NACAA National Association of Clean Air Agencies
NAICS North American Industry Classification System
NEI National Emissions Inventory
NESHAP national emission standards for hazardous air pollutants
NF3 nitrogen trifluoride
NGLs natural gas liquids
NSPS new source performance standards
NSR New Source Review
NTTAA National Technology Transfer and Advancement Act of 1995
O3 ozone
ODS ozone-depleting substance(s)
OMB Office of Management and Budget
ORIS Office of Regulatory Information Systems
PFCs perfluorocarbons
PIN personal identification number
PSD Prevention of Significant Deterioration
QA quality assurance
QA/QC quality assurance/quality control
QAPP quality assurance performance plan
R&D research and development
RFA Regulatory Flexibility Act
RGGI Regional Greenhouse Gas Initiative
RICE reciprocating internal combustion engine
RIA regulatory impact analysis
SBREFA Small Business Regulatory Enforcement Fairness Act

scf standard cubic feet
SF6 sulfur hexafluoride
SIP State Implementation Plan
SOP standard operating procedure
SSM startup, shutdown, and malfunction
TCR The Climate Registry
TRI Toxic Release Inventory
TSD technical support document
U.S. United States
UIC underground injection control
UMRA Unfunded Mandates Reform Act of 1995
UNFCCC United Nations Framework Convention on Climate Change
VMT vehicle miles traveled
VOC volatile organic compound(s)
WBCSD World Business Council for Sustainable Development
WCI Western Climate Initiative
WRI World Resources Institute
XML eXtensible Markup Language

Table of Contents

I. Background
    A. Organization of This Preamble
    B. Background on the Final Rule
    C. Legal Authority
    D. How does this rule relate to EPA and U.S. government climate
change efforts?
    E. How does this rule relate to State and regional programs?
II. General Requirements of the Rule
    A. Summary of the General Requirements of the Final Rule
    B. Summary of the Major Changes Since Proposal
    C. Summary of Comments and Responses on GHGs To Report
    D. Summary of Comments and Responses on Source Categories To
Report
    E. Summary of Comments and Responses on Thresholds
    F. Summary of Comments and Responses on Level of Reporting
    G. Summary of Comments and Responses on Initial Reporting Year
and Best Available Monitoring Methods
    H. Summary of Comments and Responses on Frequency of Reporting
and Provisions To Cease Reporting
    I. Summary of Comments and Responses on General Content of the
Annual GHG Report
    J. Summary of Comments and Responses on Submittal Date and
Making Corrections to Annual Reports
    K. Summary of Comments and Responses on De Minimis Reporting
    L. Summary of Comments and Responses on General Monitoring
Requirements
    M. Summary of Comments and Responses on General Recordkeeping
Requirements
    N. Summary of Comments and Responses on Emissions Verification
Approach
    O. Summary of Comments and Responses on the Role of States and
Relationship of This Rule to Other Programs
    P. Summary of Comments and Responses on Other General Rule
Requirements
    Q. Summary of Comments and Responses on Statutory Authority
    R. Summary of Comments and Responses on CBI
    S. Summary of Comments and Responses on Other Legal Issues
III. Reporting and Recordkeeping Requirements for Specific Source
Categories
    A. Overview
    B. Electricity Purchases
    C. General Stationary Fuel Combustion Sources
    D. Electricity Generation
    E. Adipic Acid Production
    F. Aluminum Production
    G. Ammonia Manufacturing
    H. Cement Production
    I. Electronics Manufacturing
    J. Ethanol Production
    K. Ferroalloy Production
    L. Fluorinated GHG Production
    M. Food Processing
    N. Glass Production
    O. HCFC-22 Production and HFC-23 Destruction
    P. Hydrogen Production
    Q. Iron and Steel Production
    R. Lead Production
    S. Lime Manufacturing
    T. Magnesium Production
    U. Miscellaneous Uses of Carbonates
    V. Nitric Acid Production
    W. Oil and Natural Gas Systems
    X. Petrochemical Production
    Y. Petroleum Refineries
    Z. Phosphoric Acid Production
    AA. Pulp and Paper Manufacturing
    BB. Silicon Carbide Production
    CC. Soda Ash Manufacturing
    DD. Sulfur Hexafluoride (SF6) from Electrical
Equipment
    EE. Titanium Dioxide Production
    FF. Underground Coal Mines
    GG. Zinc Production
    HH. Municipal Solid Waste Landfills
    II. Wastewater Treatment
    JJ. Manure Management
    KK. Suppliers of Coal
    LL. Suppliers of Coal-Based Liquid Fuels
    MM. Suppliers of Petroleum Products
    NN. Suppliers of Natural Gas and Natural Gas Liquids
    OO. Suppliers of Industrial GHGs
    PP. Suppliers of Carbon Dioxide (CO2)
IV. Mobile Sources
    A. Summary of Requirements of the Final Rule
    B. Summary of Changes Since Proposal
    C. Summary of Comments and Responses
V. Collection, Management, and Dissemination of GHG Emissions Data
    A. Summary of Data Collection, Management and Dissemination for
the Final Rule
    B. Summary of Comments and Responses on Collection, Management,
and Dissemination of GHG Emissions Data
VI. Compliance and Enforcement
    A. Compliance and Enforcement Summary
    B. Summary of Public Comments and Responses on Compliance and
Enforcement
VII. Economic Impacts of the Rule
    A. How were compliance costs estimated?
    B. What are the costs of the rule?
    C. What are the economic impacts of the rule?
    D. What are the impacts of the rule on small businesses?
    E. What are the benefits of the rule for society?
VIII. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health Risks and Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations
    K. Congressional Review Act

I. Background

A. Organization of This Preamble

    This preamble is broken into several large sections, as detailed
above in the Table of Contents. The paragraphs below describe the
layout of the preamble and provide a brief summary of each section.
    The first section of this preamble contains the basic background
information about the origin of this rule, our legal authority, and how
this proposal relates to other Federal, State, and regional efforts to
address emissions of GHGs.
    The second section of this preamble summarizes the general
provisions of the final GHG reporting rule and identifies the major
changes since proposal. It also provides a brief summary of public
comments and responses on key design elements such as: (i) Source
categories included, (ii) the level of reporting, (iii) applicability
thresholds, (iv) selection of reporting and monitoring methods, (v)
emissions verification, (vi) frequency of reporting and (vii) duration
of reporting. It also addresses some of the legal comments on the
statutory authority for the rule and the relationship of this rule to
other CAA programs.
    The third section of this preamble contains separate subsections
addressing each individual source category of the proposed rule. Each
source category section contains a summary of specific requirements of
the rule for that source category, identifies major changes since
proposal, and briefly discusses public comments and EPA responses
specific to the source category. For example, comments on EPA's general
approach for selecting monitoring methods are discussed in Section II
of this preamble, whereas,

comments on specific monitoring methods for individual source
categories are discussed in Section III of this preamble.
    The fourth section of this preamble summarizes rule requirements
and addresses public comments pertaining to mobile sources.
    The fifth section of this preamble explains how EPA plans to
collect, manage and disseminate the data, while the sixth section
describes the approach to compliance and enforcement. In both sections
key public comments are summarized and responses are presented.
    The seventh section provides the summary of the cost impacts,
economic impacts, and benefits of the final rule and discusses comments
on the regulatory impacts analyses. Finally, the last section discusses
the various statutory and executive order requirements applicable to
this rulemaking.

B. Background on the Final Rule

    The fiscal year 2008 (FY2008) Consolidated Appropriations Act,
signed on December 26, 2007, authorized funding for EPA to ``develop
and publish a draft rule not later than nine months after the date of
enactment of [the] Act, and a final rule not later than 18 months after
the date of enactment of [the] Act, to require mandatory reporting of
greenhouse gas emissions above appropriate thresholds in all sectors of
the economy of the United States.'' Consolidated Appropriations Act,
2008, Public Law 110-161, 121 Stat. 1844, 2128 (2008).
    The accompanying joint explanatory statement directed EPA to ``use
its existing authority under the Clean Air Act'' to develop a mandatory
GHG reporting rule. ``The Agency is further directed to include in its
rule reporting of emissions resulting from upstream production and
downstream sources, to the extent that the Administrator deems it
appropriate.'' EPA interpreted that language to confirm that it was
appropriate for the Agency to exercise its CAA authority to develop
this rulemaking. The joint explanatory statement further states that
``[t]he Administrator shall determine appropriate thresholds of
emissions above which reporting is required, and how frequently reports
shall be submitted to EPA. The Administrator shall have discretion to
use existing reporting requirements for electric generating units
(EGUs)'' under section 821 of the 1990 CAA Amendments.
    On April 10, 2009 (74 FR 16448), EPA proposed the GHG reporting
rule. EPA held two public hearings, and received approximately 16,800
written public comments. The public comment period ended on June 9,
2009.
    In addition to the public hearings, EPA had an open door policy,
similar to the outreach conducted during the development of the
proposal. As a result, EPA has met with over 4,000 people and 135
groups since proposal signature (March 10, 2009). Details of these
meetings are available in the docket (EPA-HQ-OAR-2008-0508).
    EPA developed this final rule and included reporting of GHGs from
the facilities that we determined appropriately responded to the
direction in the FY2008 Consolidated Appropriations Act \1\ (e.g.,
capturing approximately 85 percent of U.S. GHG emissions through
reporting by direct emitters as well as suppliers of fossil fuels and
industrial gases and manufacturers of heavy-duty and off-road vehicles
and engines). There are, however, many additional types of data and
reporting that the Agency deems important and necessary to address an
issue as large and complex as climate change (e.g., indirect emissions,
electricity use). In that sense, one could view this final rule as
narrowly focused on certain sources of emissions and upstream
suppliers. As described in Sections I.C and D of this preamble as well
as in the comment response sections, there are several existing
programs at the Federal, regional and State levels that also collect
valuable information to inform and implement policies necessary to
address climate change. Many of these programs are focused on cost-
effectively reducing GHG emissions through improvements in energy
efficiency and by other means. These programs are an essential
component of the Nation's climate policy, and the targeted nature of
this rule should not be interpreted to mean that the data EPA collects
through this program are the only data necessary to support the full
range of climate policies and programs.
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    \1\ Consolidated Appropriations Act, 2008, Public Law 110-161,
121 Stat. 1844, 2128. Congress reaffirmed interest in a GHG
reporting rule, and provided additional funding, in the 2009
Appropriations Act (Consolidated Appropriations Act, 2009, Public
Law 110-329, 122 Stat. 3574-3716).
---------------------------------------------------------------------------

    Today's rule requires the reporting of the GHG emissions that could
result from the combustion or use of fossil fuel or industrial gas that
is produced or imported from upstream sources such as fuel suppliers,
as well as reporting of GHG emissions directly emitted from facilities
(downstream sources) through their processes and/or from fuel
combustion, as appropriate. Vehicle and engine manufacturers are also
required to report emissions rate data on the heavy-duty and off-road
engines they produce. The rule also establishes appropriate thresholds
and frequency for reporting.
    The rule requires reporting of annual emissions of carbon dioxide
(CO2), methane (CH4), nitrous oxide
(N2O), sulfur hexafluoride (SF6),
hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and other
fluorinated gases (e.g., nitrogen trifluoride (NF3) and
hydrofluorinated ethers (HFEs)). It also includes provisions to ensure
the accuracy of emissions data through monitoring, recordkeeping and
verification requirements. The rule applies to certain downstream
facilities that emit GHGs (primarily large facilities emitting 25,000
metric tons or more of CO2 equivalent (CO2e) GHG
emissions per year) and to most upstream suppliers of fossil fuels and
industrial GHGs, as well as to manufacturers of vehicles and engines.
Reporting is at the facility level, except certain suppliers and
vehicle and engine manufacturers report at the corporate level.

C. Legal Authority

    As proposed, EPA is promulgating this rule under its existing CAA
authority, specifically authorities provided in CAA sections 114 and
208. As discussed further below and in ``Mandatory Greenhouse Gas
Reporting Rule: EPA's Response to Public Comments, Legal Issues'', we
are not citing the FY 2008 Consolidated Appropriations Act as the
statutory basis for this action. While that law required that EPA spend
no less than $3.5 million on a rule requiring the mandatory reporting
of GHG emissions, it is the CAA, not the Appropriations Act, that EPA
is citing as the authority to gather the information required by this
rule.
    Sections 114 and 208 of the CAA provide EPA broad authority to
require the information mandated by this rule because such data will
inform and are relevant to EPA's carrying out a wide variety of CAA
provisions. As discussed in the proposed rule, CAA section 114(a)(1)
authorizes the Administrator to require emissions sources, persons
subject to the CAA, or persons whom the Administrator believes may have
necessary information to monitor and report emissions and provide such
other information the Administrator requests for the purposes of
carrying out any provision of the CAA (except for a provision of title
II with respect to manufacturers of new motor vehicles or

new motor vehicle engines).\2\ Section 208 of the CAA provides EPA with
similar broad authority regarding the manufacturers of new motor
vehicles or new motor vehicle engines, and other persons subject to the
requirements of parts A and C of title II. We note that while climate
change legislation approved by the U.S. House of Representatives would
provide EPA additional authority for a GHG registry similar to today's
rule, and would do so for purposes of that pending legislation, this
final rule is authorized by, and the information being gathered by the
rule is relevant to implementing, the existing CAA. We expect, however,
that the information collected by this final rule will also prove
useful to legislative efforts to address GHG emissions.
---------------------------------------------------------------------------

    \2\ Although there are exclusions in CAA section 114(a)(1)
regarding certain title II requirements applicable to manufacturers
of new motor vehicle and motor vehicle engines, CAA section 208
authorizes the gathering of information related to those areas.
---------------------------------------------------------------------------

    As discussed in the proposal, emissions from direct emitters should
inform decisions about whether and how to use CAA section 111 to
establish new source performance standards (NSPS) for various source
categories emitting GHGs, including whether there are any additional
categories of sources that should be listed under CAA section 111(b).
Similarly, the information required of manufacturers of mobile sources
should support decisions regarding treatment of those sources under CAA
sections 202, 213 or 231. In addition, the information from fuel
suppliers would be relevant in analyzing whether to proceed, and
particular options for how to proceed, under CAA section 211(c)
regarding fuels, or to inform action concerning downstream sources
under a variety of Title I or Title II provisions. The data overall
also would inform EPA's implementation of CAA section 103(g) regarding
improvements in non-regulatory strategies and technologies for
preventing or reducing air pollutants (e.g., EPA's voluntary GHG
reduction programs such as the non-CO2 partnership programs
and ENERGY STAR, described below in Section I.D of this preamble and
Section II of the proposal preamble (74 FR 16448, April 10, 2009)).

D. How does this rule relate to EPA and U.S. government climate change
efforts?

    This reporting rule is one specific action EPA has taken,
consistent with the Congressional request contained in the FY2008
Consolidated Appropriations Act, to collect GHG emissions data. EPA has
recently announced a number of climate change related actions,
including proposed findings that GHG emissions from new motor vehicles
and engines contribute to air pollution which may reasonably be
anticipated to endanger public health and welfare (74 FR 18886, April
24, 2009, ``Proposed Endangerment and Cause or Contribute Findings for
Greenhouse Gases Under Section 202(a) of the Clean Air Act''), and an
intent to regulate light duty vehicles, jointly published with U.S.
Department of Transportation (DOT) (74 FR 24007, May 22, 2009, ``Notice
of Upcoming Joint Rulemaking To Establish Vehicle GHG Emissions and
CAFE Standards''). The Administrator has also announced her
reconsideration of the memo entitled ``EPA's Interpretation of
Regulations that Determine Pollutants Covered By Federal Prevention of
Significant Deterioration (PSD) Permit Program'' (73 FR 80300, December
31, 2008), and granted California's request for a waiver for its GHG
vehicle standard (74 FR 32744, July 8, 2009). These are all separate
actions, some of which are related to EPA's response to the U.S.
Supreme Court's decision in Massachusetts v. EPA. 127 S. Ct. 1438
(2007). This rulemaking does not indicate EPA has made any final
decisions on pending actions. In fact the mandatory GHG reporting
program will provide EPA, other government agencies, and outside
stakeholders with economy-wide data on facility-level (and in some
cases corporate-level) GHG emissions, which should assist in future
policy development.
    Accurate and timely information on GHG emissions is essential for
informing many future climate change policy decisions. Although
additional data collection (e.g., for other source categories or to
support additional policy or program needs) will no doubt be required
as the development of climate policies evolves, the data collected in
this rule will provide useful information for a variety of polices.
Through data collected under this rule, EPA, States and the public will
gain a better understanding of the relative emissions of specific
industries across the nation and the distribution of emissions from
individual facilities within those industries. The facility-specific
data will also improve our understanding of the factors that influence
GHG emission rates and actions that facilities could in the future or
already take to reduce emissions, including under traditional and more
flexible programs.
    As discussed in more detail in ``Mandatory Greenhouse Gas Reporting
Rule: EPA's Response to Public Comments, Legal Issues'' and elsewhere,
EPA is promulgating this rule to gather GHG information to assist EPA
in assessing how to address GHG emissions and climate change under the
Clean Air Act. However, we expect that the information will prove
useful for other purposes as well. For example, using the rich data set
provided by this rulemaking, EPA, States and the public will be able to
track emission trends from industries and facilities within industries
over time, particularly in response to policies and potential
regulations. The data collected by this rule will also improve the U.S.
government's ability to formulate climate policies, and to assess which
industries might be affected, and how these industries might be
affected by potential policies. Finally, EPA's experience with other
reporting programs is that such programs raise awareness of emissions
among reporters and other stakeholders, and thus contribute to efforts
to identify and implement emission reduction opportunities. These data
can also be coupled with efforts at the local, State and Federal levels
to assist corporations and facilities in determining their GHG
footprints and identifying opportunities to reduce emissions (e.g.,
through energy audits or other forms of assistance).
    This GHG reporting program supplements and complements, rather than
duplicates, existing U.S. government programs (e.g., climate policy and
research programs). For example, EPA anticipates that facility-level
GHG emissions data will lead to improvements in the quality of the
Inventory of U.S. Greenhouse Gas Emissions and Sinks (Inventory), which
EPA prepares annually, with input from several other agencies, and
submits to the Secretariat of the United Nations Framework Convention
on Climate Change (UNFCCC).
    A number of EPA voluntary partnership programs include a GHG
emissions and/or reductions reporting component (e.g., Climate Leaders,
the Natural Gas STAR program, Energy Star). This mandatory reporting
program has broader coverage of U.S. GHG emissions than most voluntary
programs, which typically focus on a specific industry and/or goal
(e.g., reduction of CH4 emissions or development of
corporate inventories). It will improve EPA's understanding of
emissions from facilities not currently included in these programs and
increase the coverage of these industries. That said, we expect ongoing
and potential new voluntary programs to continue to

play an important role in achieving low-cost reductions in GHG
emissions.
    In addition to EPA's programs mentioned above, U.S. Department of
Energy (DOE) EIA implements a voluntary GHG registry under section
1605(b) of the Energy Policy Act, which is further discussed in Section
II of the proposal preamble (74 FR 16458, April 10, 2009). Under EIA's
``1605(b) program,'' reporters can choose to prepare an entity-wide GHG
inventory and identify specific GHG reductions made by the entity.\3\
EPA's mandatory GHG reporting rule covers a much broader set of
reporters, primarily at the facility rather than entity-level, but this
reporting rule is not designed with the specific intent of reporting of
emission reductions, as is the 1605(b) program.
    For additional information about these programs, please see
Sections I and II of the preamble to the proposed GHG reporting rule
(74 FR 16454, April 10, 2009).
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    \3\ Under the 1605(b) program an ``entity'' is defined as ``the
whole or part of any business, institution, organization or
household that is recognized as an entity under any U.S. Federal,
State or local law that applies to it; is located, at least in part,
in the U.S.; and whose operations affect U.S. greenhouse gas
emissions.'' (http://www.pi.energy.gov/enhancingGHGregistry/)
---------------------------------------------------------------------------

E. How does this rule relate to other State and Regional Programs?

    There are several existing State and regional GHG reporting and/or
reduction programs summarized in Section II of the proposal preamble
(74 FR 16457, April 10, 2009). These are important programs that not
only led the way in reporting of GHG emissions before the Federal
government acted but also assist in quantifying the GHG reductions
achieved by various policies. Many of these programs collect different
or additional data as compared to this rule. For example, State
programs may establish lower thresholds for reporting or request
information on areas not addressed in EPA's reporting rule (e.g.,
electricity use or emission related to other indirect sources). States
collecting additional information have determined that these data are
necessary to implement their specific climate policies and programs.
EPA agrees that State and regional programs are crucial to achieving
emissions reductions, and this rule does not preempt any other
programs.
    EPA's GHG reporting rule is a specific single action that was
developed in response to the Appropriations Act, and therefore is
targeted to accomplish the purpose of the language of the
Appropriations Act and serve EPA's purposes under the CAA. As State
experience has demonstrated, we recognize that in order to address the
breadth of climate change issues there will likely be a need to collect
additional data from sources subject to this rule as well as other
sources. The timing and nature of these additional needs will be
dependent on the types of programs and actions the Agency has underway
or may develop and implement in response to future policy developments
and/or new requests from Congress. Addressing climate change will
require a suite of policies and programs and this reporting rule is
just one effort to collect information to inform those policies.
    EPA is committed to working with State and regional programs to
coordinate implementation of reporting programs, reduce burden on
reporters, provide timely access to verified emissions data, establish
mechanisms to efficiently share data, and harmonize data systems to the
extent possible. See Section II.O of this preamble for a summary of
public comments and responses on the role of States and the
relationship of this GHG reporting rule to other programs. See Section
VI.B of this preamble for a summary of comments and responses on State
delegation of rule implementation and enforcement. As mentioned above,
for additional information about existing State and regional programs
please see Section II of the proposal preamble (74 FR 16457, April 10,
2009) and the docket EPA-HQ-OAR-2008-0508.

II. General Requirements of the Rule

    The rule requires reporting of annual emissions of CO2,
CH4, N2O, SF6, HFCs, PFCs, and other
fluorinated gases (as defined in 40 CFR part 98, subpart A) in metric
tons. The final 40 CFR part 98 applies to certain downstream facilities
that emit GHGs, and to certain upstream suppliers of fossil fuels and
industrial GHGs. For suppliers, the GHG emissions reported are the
emissions that would result from combustion or use of the products
supplied. The rule also includes provisions to ensure the accuracy of
emissions data through monitoring, recordkeeping and verification
requirements. Reporting is at the facility \4\ level, except that
certain suppliers of fossil fuels and industrial gases would report at
the corporate level.
---------------------------------------------------------------------------

    \4\ For the purposes of this rule, facility means any physical
property, plant, building, structure, source, or stationary
equipment located on one or more contiguous or adjacent properties
in actual physical contact or separated solely by a public roadway
or other public right-of-way and under common ownership or common
control, that emits or may emit any greenhouse gas. Operators of
military installations may classify such installations as more than
a single facility based on distinct and independent functional
groupings within contiguous military properties.
---------------------------------------------------------------------------

    In addition, GHG reporting by manufacturers of heavy-duty and off-
road vehicles and engines is required, by incorporating new
requirements into the existing reporting requirements for motor
vehicles and engine manufacturers in 40 CFR parts 86, 87, 89, 90, 94,
1033, 1039, 1042, 1045, 1048, 1051, 1054, and 1065. A summary of the
reporting requirements for manufacturers of motor vehicles and engines
is contained in Section IV of this preamble. A discussion of public
comments and responses that pertain to motor vehicles is also contained
in Section IV of this preamble and in the ``Mandatory Greenhouse Gas
Reporting Rule: EPA's Response to Public Comments, Motor Vehicle and
Engine Manufacturers.''
    The remainder of this section summarizes the general provisions of
40 CFR part 98, identifies changes since the proposed rule, and
summarizes key public comments and responses on the general
requirements of the rule.

A. Summary of the General Requirements of the Final Rule

1. Applicability
    Reporters must submit annual GHG reports for the following
facilities and supply operations.
     Any facility that contains any source category (as defined
in 40 CFR part 98, subparts C through JJ) that is listed below in any
calendar year starting in 2010.\5\ For these facilities, the annual GHG
report covers all source categories and GHGs for which calculation
methodologies are provided in 40 CFR part 98, subparts C through JJ.
---------------------------------------------------------------------------

    \5\ Unless otherwise noted, years and dates in this notice refer
to calendar years and dates.

--Electricity generating facilities that are subject to the Acid Rain
Program (ARP) or otherwise report CO2 mass emissions year-
round through 40 CFR part 75.
--Adipic acid production.
--Aluminum production.
--Ammonia manufacturing.
--Cement production.
--HCFC-22 production.
--HFC-23 destruction processes that are not co-located with a HCFC-22
production facility and that destroy more than 2.14 metric tons of HFC-
23 per year.
--Lime manufacturing.
--Nitric acid production.
--Petrochemical production.
--Petroleum refineries.

--Phosphoric acid production.
--Silicon carbide production.
--Soda ash production.
--Titanium dioxide production.
--Municipal solid waste (MSW) landfills that generate CH4 in
amounts equivalent to 25,000 metric tons CO2e or more per
year, as determined according to 40 CFR part 98, subpart HH.
--Manure management systems that emit CH4 and N20
(combined) in amounts equivalent to 25,000 metric tons CO2e
or more per year, as determined according to 40 CFR part 98, subpart
JJ.

     Any facility that contains any source category (as defined
in 40 CFR part 98, subparts C through JJ) that is listed below and that
emits 25,000 metric tons CO2e or more per year in combined
emissions from stationary fuel combustion units, miscellaneous use of
carbonates and all of the source categories listed in this paragraph in
any calendar year starting in 2010. For these facilities, the annual
GHG report must cover all source categories and GHGs for which
calculation methodologies are provided in 40 CFR part 98, subparts C
through JJ.

--Ferroalloy Production.
--Glass Production.
--Hydrogen Production.
--Iron and Steel Production.
--Lead Production.
--Pulp and Paper Manufacturing.
--Zinc Production.

     Any facility that in any calendar year starting in 2010
meets all three of the conditions listed in this paragraph. For these
facilities, the annual GHG report covers emissions from stationary fuel
combustion sources only. For 2010 only, the facilities can submit an
abbreviated GHG report according to 40 CFR 98.3(d).

--The facility does not meet the requirements described in the above
two paragraphs;
--The aggregate maximum rated heat input capacity of the stationary
fuel combustion units at the facility is 30 million British thermal
units per hour (mmBtu/hr) or greater; and
--The facility emits 25,000 metric tons CO2e or more per
year from all stationary fuel combustion sources.\6\
---------------------------------------------------------------------------

    \6\ This does not include portable equipment, emergency
generators, or emergency equipment as defined in the rule.

     Any supplier (as defined in 40 CFR part 98, subparts LL
through PP) of any of the products as listed below in any calendar year
starting in 2010. For these suppliers, the annual GHG report covers all
applicable products for which calculation methodologies are provided in
---------------------------------------------------------------------------
40 CFR part 98, subparts KK through PP.

--Coal-based liquid fuels: All producers of coal-to-liquid fuels;
importers and exporters of coal-to-liquid fuels with annual imports or
annual exports that are equivalent to 25,000 metric tons
CO2e or more per year.
--Petroleum products: All petroleum refiners that distill crude oil;
importers and exporters of petroleum products with annual imports or
annual exports that are equivalent to 25,000 metric tons
CO2e or more per year.
--Natural gas and natural gas liquids (NGLs): All natural gas
fractionators and all local natural gas distribution companies (LDCs).
--Industrial GHGs: All producers of industrial GHGs; importers and
exporters of industrial GHGs with annual bulk imports or exports of
N2O, fluorinated GHGs, and CO2 that in
combination are equivalent to 25,000 metric tons CO2e or
more per year.

--CO2: All producers of CO2; importers and exporters of
CO2 with annual bulk imports or exports of N2O,
fluorinated GHGs, and CO2 that in combination are equivalent
to 25,000 metric tons CO2e or more per year.

     Research and development activities (as defined in 40 CFR
98.6) are not considered to be part of any source category subject to
the rule.
    It is important to note that the applicability criteria apply to a
facility's annual emissions or a supplier's annual quantity of product
supplied.\7\ For example, while a facility's emissions may be below
25,000 metric tons CO2e in January, if the cumulative
emissions for the calendar year are 25,000 metric tons CO2e
or more at the end of December, the rule applies and the reporter must
submit an annual GHG report for that facility. Therefore, it is in a
facility's or supplier's interest to collect the GHG data required by
the rule if they think they will meet or exceed the applicability
criteria in 40 CFR 98.2 by the end of the year. EPA plans to have tools
and guidance available to assist potential reporters in assessing
whether the rule applies to their facilities or supply operations.
---------------------------------------------------------------------------

    \7\ Supplied means produced, imported, or exported.
---------------------------------------------------------------------------

2. Schedule for Reporting
    Reporters must begin collecting data on January 1, 2010. The first
annual GHG report is due on March 31, 2011, for GHGs emitted or
products supplied during 2010. For a portion of 2010, the rule allows
reporters to use best available monitoring methods for parameters that
cannot reasonably be measured according to the monitoring and quality
assurance/quality control (QA/QC) requirements of the relevant subpart
as described in Sections II.A.3 and II.G of this preamble.
    Reports are submitted annually. For EGUs that are subject to the
ARP, reporters must continue to report CO2 mass emissions
quarterly, as required by the ARP, in addition to providing annual GHG
reports under this rule. Reporters must submit GHG data on an ongoing,
annual basis. The snapshot of information provided by a one-time
information collection request (ICR) would not provide the type of
ongoing information which could inform the variety of potential CAA
policy options being evaluated for addressing climate change.
    Once subject to this reporting rule, reporters must continue to
submit GHG reports annually. A reporter can cease reporting if the
required annual GHG reports demonstrate that reported GHG emissions are
either (1) less than 25,000 metric tons of CO2e per year for
five consecutive years or (2) less than 15,000 metric tons of
CO2e per year for three consecutive years. The reporter must
notify EPA that they intend to cease reporting and explain the reasons
for the reduction in emissions. This provision applies to all
facilities and suppliers subject to the rule, regardless of their
applicability category (i.e., whether rule applicability was initially
triggered by an ``all-in'' source category or a source category with a
25,000 metric tons CO2e threshold). The reporter must keep
records for all five consecutive years in which emissions were less
than 25,000 metric tons per year, or all three consecutive years in
which emissions were less than 15,000 metric tons per year, as
appropriate. If GHG emissions (or quantities in products supplied)
subsequently increase to 25,000 metric tons CO2e in any
calendar year, the reporter must again begin annual reporting. The rule
also contains a provision to allow facilities and suppliers to notify
EPA and stop reporting if they close all GHG-emitting processes and
operations covered by the rule.
    If reporters discover or are notified by EPA of errors in an annual
GHG report, they must submit a revised GHG report within 45 days.
3. What has to be included in the annual GHG report?
    Reporters must include the following information in each annual GHG
report:

     Facility name or supplier name (as appropriate) and
physical street address including the city, State, and zip code.
     Year and months covered by the report, and date of report
submittal.
     For facilities that directly emit GHG:

--Annual facility emissions (excluding biogenic CO2),
expressed in metric tons of CO2e per year, aggregated for
all GHG from all source categories in 40 CFR part 98, subparts C
through JJ that are located at the facility.
--Annual emissions of biogenic CO2 (i.e., CO2
from combustion of biomass) aggregated for all applicable source
categories in subparts C through JJ located at the facility.
--Annual GHG emissions for each of the source categories located at the
facility, by gas. Gases are: CO2 (excluding biogenic
CO2), biogenic CO2, CH4,
N2O, and each fluorinated GHG.
--Within each source category, emissions broken out at the level
specified in the respective subpart (e.g., some source categories
require reporting for each individual unit or each process line).
--Additional data specified in the applicable subparts for each source
category. This includes activity data (e.g., fuel use, feedstock
inputs) that were used to generate the emissions data and additional
data to support QA/QC and emissions verification.
--Total pounds of synthetic fertilizer produced through nitric acid or
ammonia production and total nitrogen contained in that fertilizer.

     For suppliers: \8\
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    \8\ Suppliers include producers, importers, and exporters of
fuels and industrial gases. The level of reporting for suppliers is
specified in the rule. Most report at the facility level. Imports
and exports are reported at the corporate level.

--Annual quantities of each GHG that would be emitted from combustion
or use \9\ of the products supplied, imported, or exported during the
year. Report this for each applicable supply category in 40 CFR part 98
subparts KK through PP, by gas. Also report the total quantity,
expressed in metric tons of CO2e, aggregated for all GHGs
from all applicable supply categories.
---------------------------------------------------------------------------

    \9\ ``Use'' for purposes of industrial GHGs presumes that there
will be 100 percent release of the GHG.
---------------------------------------------------------------------------

--Additional data specified in the applicable subparts for each supply
category. This includes data used to calculate GHG quantities or needed
to support QA/QC and verification.

     A written explanation if the reporter changes GHG
calculation methodologies during the reporting period.
     If best available monitoring methods were used for part of
calendar year 2010, a brief description of the methods used.
     Each data element for which a missing data procedure was
used according to the procedures of an applicable subpart and the total
number of hours in the year that a missing data procedure was used for
each data element.
     A signed and dated certification statement provided by the
Designated Representative of the owner or operator.
    Note that in some cases, the same facility is subject to the rule
requirements for direct emitters as well as for suppliers. For example,
petroleum refineries are suppliers of petroleum products (40 CFR part
98, subpart NN) and also directly emit GHGs from petroleum refining (40
CFR part 98, subpart Y), general stationary fuel combustion (40 CFR
part 98, subpart C), and possibly other source categories located at a
refinery. In such cases, reporters must report the information in both
the facility and supplier bullets listed above.
    EPA will protect any information claimed as CBI in accordance with
regulations in 40 CFR part 2, subpart B. However, note that in general,
emission data collected under CAA sections 114 and 208 shall be
available to the public and cannot be withheld as CBI.\10\
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    \10\ Although CBI determinations are usually made on a case-by-
case basis, EPA has discussed in an earlier Federal Register notice
what constitutes emissions data that cannot be withheld as CBI (956
FR 7042-7043, February 21, 1991). In addition, as discussed in
Section II.R of this preamble, EPA will be initiating a separate
notice and comment process to make CBI and emissions data
determinations for the categories of data collected under this
rulemaking.
---------------------------------------------------------------------------

    Special Provisions for Reporting Year 2010. During January 1, 2010
through March 31, 2010, reporters may use best available monitoring
methods for any parameter (e.g., fuel use, daily carbon content of
feedstock by process line) that cannot reasonably be measured according
to the monitoring and QA/QC requirements of a relevant subpart. The
reporter must still use the calculation methodologies and equations in
the ``Calculating GHG Emissions'' sections of each relevant subpart,
but may use the best available monitoring method for any parameter for
which it is not reasonably feasible to acquire, install, and operate a
required piece of monitoring equipment by January 1, 2010. Starting no
later than April 1, 2010, the reporter must begin following all
applicable monitoring and QA/QC requirements of this part, unless they
submit a request to EPA showing that it is not reasonably feasible to
acquire, install, and operate a required piece of monitoring equipment
by April 1, 2010, and EPA approves the request. EPA will not approve
use of best available methods beyond December 31, 2010. Best available
monitoring methods include any of the following methods:
     Monitoring methods currently used by the facility that do
not meet the specifications of a relevant subpart.
     Supplier data.
     Engineering calculations.
     Other company data.
    Abbreviated GHG Report for Facilities Containing Only General
Stationary Fuel Combustion Sources. In lieu of a full annual GHG
report, reporters may submit an abbreviated GHG report for 2010
emissions from existing facilities that were in operation as of January
1, 2010, and are required to report only their stationary combustion
source emissions per 40 CFR 98.2(a)(3). The abbreviated report contains
total facility GHG emissions aggregated for all stationary combustion
units calculated according to any of the methods in 40 CFR 98.33(a) and
expressed in metric tons of CO2, CH4,
N2O, and CO2e. While the breakdown of emissions
by individual combustion units and the activity data used to calculate
the emissions do not need to be reported as part of the abbreviated GHG
report, the calculation variables used in the selected method must be
reported. For calendar year 2011, all reporters must submit the full
annual GHG report containing all required information.
4. How is the report submitted?
    The reports must be submitted electronically, in a format to be
specified by the Administrator after publication of the final rule.\11\
To the extent practicable, we plan to adapt existing EPA facility
reporting programs to accept GHG emissions data. We are developing a
new electronic data reporting system for source categories or suppliers
for which it is not feasible to use existing EPA reporting mechanisms.
---------------------------------------------------------------------------

    \11\ For more information about the reporting format please see
Section V of this preamble.
---------------------------------------------------------------------------

    Each report must contain a signed certification by a Designated
Representative of the facility. On behalf of the owners and operators,
the Designated Representative must certify under penalty of law that
the report has been prepared in accordance with the requirements of 40
CFR part 98 and that the information contained in the report is true
and accurate.
5. What records must be retained?
    Each reporter must also retain and make available to EPA upon
request the

following records for three years in an electronic or hard-copy format
as appropriate:
     A list of all units, operations, processes and activities
for which GHG emissions are calculated.
     The data used to calculate the GHG emissions for each
unit, operation, process, and activity, categorized by fuel or material
type. These data include, but are not limited to:

--The GHG emissions calculations and methods used.
--Analytical results for the development of site-specific emissions
factors.
--The results of all required analyses for high heat value, carbon
content, or other required fuel or feedstock parameters.
--Any facility operating data or process information used for the GHG
emissions calculations.

     The annual GHG reports.
     Missing data computations. For each missing data event,
also retain a record of the duration of the event, actions taken to
restore malfunctioning monitoring equipment, the cause of the event,
and the actions taken to prevent or minimize occurrence in the future.
     A written GHG monitoring plan containing the information
specified in 40 CFR 98.3(g)(5).
     The results of all required certification and quality
assurance (QA) tests of CEMS, fuel flow meters, and other
instrumentation used to provide data for the GHGs reported.
     Maintenance records for all CEMS, flow meters, and other
instrumentation used to provide data for the GHGs reported.
     Any other data specified in any applicable subpart of 40
CFR part 98. Examples of such data could include the results of
sampling and analysis procedures required by the subparts (e.g., fuel
heat content, carbon content of raw materials, and flow rate) and other
data used to calculate emissions.

B. Summary of the Major Changes Since Proposal

    EPA received approximately 16,800 public comments on the proposed
rulemaking. As mentioned earlier in this preamble, we had two public
hearings and conducted an unprecedented level of outreach between
signature of the proposal and the close of the public comment period.
Below are the major changes to the program since the proposal. The
rationale for these and any other significant changes can be found in
this preamble or in the ``Mandatory Greenhouse Gas Reporting Rule:
EPA's Response to Public Comments.''
     Reduced the number of source categories included in the
final rule as we further consider comments and options on several
categories.\12\
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    \12\ See the following sections of this preamble for discussion
of source categories not included in today's final rule: sections
III.I (electronics manufacturing), III.J (ethanol production), III.L
(fluorinated GHG production), III.M (food processing), III.T
(magnesium production), III.W (oil and natural gas systems), III.DD
(SF6 from electrical equipment), III.FF (underground coal
mines), III.HH (industrial landfills are not included in today's
rule, but MSW landfills are covered by the rule), III.II (wastewater
treatment), and III.KK (suppliers of coal).
---------------------------------------------------------------------------

     Added a mechanism in 40 CFR 98.2 to allow facilities and
suppliers that report less than 25,000 metric tons of CO2e
for five consecutive years, or less than 15,000 metric tons for 3
consecutive years, to cease annual reporting to EPA.
     Added a mechanism in 40 CFR 98.2 to allow facilities and
suppliers that stop operating all GHG-emitting processes and operations
covered by the rule to cease annual reporting to EPA.
     Added a provision in 40 CFR 98.3 for submittal of revised
annual GHG reports to correct errors.
     Added provisions in 40 CFR 98.3 to allow use of best
available monitoring methods for part of calendar year 2010.
     Added, in 40 CFR 98.3, calibration requirements for
monitoring instruments including an accuracy specification of plus or
minus five percent for flow meters.
     Excluded R&D activities from reporting under 40 CFR part
98 by adding an exclusion in 40 CFR 98.2.
     Revised the requirements of the Designated Representative
in 40 CFR 98.4 to align them with those in 40 CFR part 75 (ARP
regulations).
     Changed record retention to three years instead of five
years for most records (40 CFR 98.3).
     In the recordkeeping section (40 CFR 98.3), clarified the
contents of the monitoring plan (called the quality assurance
performance plan (QAPP) at proposal).
     Edited references to the stationary fuel combustion
subpart to improve consistency and edited the CEMS language in several
subparts for consistency and to clarify when CEMS are used and under
what circumstances upgrades are needed.
     Revised several definitions in 40 CFR part 98, subpart A
to address comments.
     In several subparts of 40 CFR part 98, moved some of the
data elements listed in the recordkeeping section of the proposed rule
to the reporting section. In general, these changes were made to
provide sufficient data for EPA to verify the reported emissions using
the verification approach described in Section II.N of this preamble.
Specific changes and reasons for them are summarized in the relevant
source category sections within Section III of this preamble.

C. Summary of Comments and Responses on GHGs To Report

    This section contains a brief summary of major comments and
responses on the issue of which GHGs to report. A large number of
comments were received covering numerous topics. Responses to
significant comments received can be found in ``Mandatory Greenhouse
Gas Reporting Rule: EPA's Response to Public Comments, Selection of
Reporting Thresholds, Greenhouse Gases, and De Minimis Provisions.''
Reponses to comments on fluorinated gases can be found in ``Mandatory
Greenhouse Gas Reporting Rule: EPA's Response to Public Comments,
Suppliers of Industrial GHGs.''
    Comment: Many commenters supported reporting of the GHGs included
in the proposed rule: CO2, CH4, N2O,
HFCs, PFCs, SF6, and other fluorinated compounds. Many
commenters noted that IPCC and national inventories focus on these
gases, and that they are directly emitted by human activities, long-
lived in the atmosphere, and contribute to global climate change. A few
of these also stated that collection of data on these gases is useful
for future GHG policy development. While some commenters suggested
collecting data on fewer gases or requiring reporting of additional
gases, most agreed with the proposed list.
    Some commenters raised concerns that the proposed definition of
fluorinated GHGs was broad and included compounds for which global
warming potentials (GWPs) were not currently available.
    Response: The final rule requires reporting of the same gases as
the proposed rule. These are the most abundantly emitted GHGs that
result from human activity. They are not currently controlled by
mandatory Federal programs and, with the exception of the
CO2 emissions data reported by EGUs subject to the ARP, data
on their emissions are also not reported under mandatory Federal
programs. CO2 is the most abundant GHG directly emitted by
human activities, and is a significant driver of climate change. The
global anthropogenic combined heating effect of CH4,
N2O, HFCs, PFCs, SF6, and the other fluorinated
compounds are also

significant: About 40 percent as large as the CO2 heating
effect according to the Fourth Assessment Report of the IPCC.
    The IPCC focuses on CO2, CH4, N2O,
HFCs, PFCs, and SF6 for both scientific assessments and
emissions inventory purposes because these are long-lived, well-mixed
GHGs not controlled by the Montreal Protocol as Substances that Deplete
the Ozone (O3) Layer. These GHGs are directly emitted by
human activities, are reported annually in EPA's Inventory of U.S.
Greenhouse Gas Emissions and Sinks, and are a major focus of the
climate change research and policy communities. The IPCC also included
methods for accounting for emissions from several specified fluorinated
gases in the 2006 IPCC Guidelines for National Greenhouse Gas
Inventories.\13\ These gases include fluorinated ethers, which are used
in electronics, in anesthetics, and as heat transfer fluids. These
fluorinated compounds are long-lived in the atmosphere and have high
GWPs, like the HFCs, PFCs, and SF6. In many cases these
fluorinated gases are used in growing industries (e.g., electronics) or
as substitutes for HFCs. As such, EPA is requiring reporting of these
gases to ensure that the Agency has an accurate understanding of the
emissions and uses of these gases, particularly as those uses expand.
---------------------------------------------------------------------------

    \13\ 2006 IPCC Guidelines for National Greenhouse Gas
Inventories. The National Greenhouse Gas Inventories Programme, H.S.
Eggleston, L. Buendia, K. Miwa, T. Ngara, and K. Tanabe (eds),
hereafter referred to as the ``2006 IPCC Guidelines'' are found at:
http://www.ipcc.ch/ipccreports/methodology-reports.htm. For
additional information on these gases please see Table A-1 in
proposed 40 CFR part 98, subpart A and the Suppliers of Industrial
GHGs TSD (EPA-HQ-OAR-2008-0508-041).
---------------------------------------------------------------------------

    There are other GHGs and aerosols that have climatic warming
effects that we are not including in this rule: water vapor,
chlorofluorocarbons (CFCs), hydrochlorofluorocarbons (HCFCs), halons,
tropospheric O3, and black carbon. The reasons why we are
not requiring reporting of these gases and aerosols under this rule are
contained in Section IV.A of the preamble to the proposed rule (74 FR
16464, April 10, 2009) and in the ``Mandatory Greenhouse Gas Reporting
Rule: EPA's Response to Public Comments, Selection of Reporting
Thresholds, Greenhouse Gases, and De Minimis Provisions.''
    In response to comments, the definition of fluorinated gases to
report has been changed. See Section III.OO of this preamble (Suppliers
of Industrial GHGs) for the response to comments on fluorinated gases
to be reported.

D. Summary of Comments and Responses on Source Categories To Report

    This section contains a brief summary of major comments and
responses on which source categories must report. A large number of
comments were received covering numerous topics. Responses to
significant comments received can be found in ``Mandatory Greenhouse
Gas Reporting Rule: EPA's Response to Public Comments, Selection of
Source Categories to Report and Level of Reporting.''
1. Reduction in Number of Source Categories Included in the Final Rule
    Comment: While many commenters agreed with the source categories
selected for inclusion in the proposed rule, some commenters objected
to the inclusion of specific source categories. Some also expressed
concern that there might not be sufficient time for EPA to consider and
address public comments and finalize the rules by fall 2009 for
particular source categories.
    Response: In today's notice EPA is promulgating subparts that
require reporting for most of the source categories included in the
proposed rule. For these categories, EPA fully considered and addressed
the public comments, and has determined that the source categories
should be included in the rule for reasons stated in Section IV.B of
the preamble for the proposed rule (74 FR 16465, April 10, 2009), the
``Mandatory Greenhouse Gas Reporting Rule: EPA's Response to Public
Comments: EPA's Response to Public Comments, Selection of Source
Categories to Report and Level of Reporting'', and the relevant comment
response volumes for each of the individual source categories. However,
at this time EPA is not going final with the following subparts as we
further evaluate public comments:

 Electronics manufacturing
 Ethanol production
 Fluorinated GHG production
 Food processing
 Magnesium production
 Oil and natural gas systems
 SF6 from electrical equipment
 Underground coal mines
 Industrial landfills
 Wastewater treatment
 Suppliers of coal

    We plan to further review public comments and other information
before finalizing these subparts. Additional discussion of our reasons
for not finalizing these particular source categories at this time can
be found in the individual subsections in Section III of this preamble.
2. Scope of Source Categories Covered
    Comment: Several commenters suggested that the scope of reporting
and the source categories covered should be broader. Some indicated
that the rule should require reporting of net rather than gross
emissions, including reporting of offset projects. In addition, some of
the comments suggested requiring reporting of emissions and
sequestration from forestry practices.
    Response: EPA selected the source categories required to report
under the rule after considering the language of the Appropriations
Act, the accompanying explanatory statement, the CAA, and EPA's
experience in developing the U.S. GHG Inventory. The Appropriations Act
referred to reporting ``in all sectors of the economy,'' and the
explanatory statement directed EPA to include ``emissions from upstream
production and downstream sources to the extent the Administrator deems
it appropriate.'' EPA interpreted this to mean direct emissions from
facilities over a certain threshold as well as the emissions associated
with fuel or industrial gases when completely combusted or used, but
not necessarily project-based reductions or sequestration.\14\
Calculation and reporting of net emissions (emissions at a facility
less any sequestration occurring at the facility) was determined to be
outside of the scope of this rule.
---------------------------------------------------------------------------

    \14\ For the discussion of the CAA authority to collect these
data, see Section II.Q of this preamble. Also see the relevant
source category sections within Section III of this preamble.
---------------------------------------------------------------------------

    In selecting source categories, EPA considered all anthropogenic
sources of GHG emissions (those produced as a result of human
activities) included in the U.S. GHG Inventory and reviewed the 2006
IPCC Guidelines for National Greenhouse Gas Inventories and existing
voluntary and regulatory GHG reporting programs for additional source
categories that might be relevant. EPA systematically reviewed the list
of source categories developed from the U.S. GHG Inventory and the IPCC
guidance to ensure the inclusion of those that emit the most
significant amounts of GHG emissions while minimizing the number of
reporters. Some sources were deemed inappropriate for inclusion in this
rule for a variety of reasons including the current ability to monitor
and verify the emissions or products with sufficient accuracy and
consistency. For further discussions of sources included and excluded
please see Section IV.B of the preamble to the proposed rule (74 FR
16465). In total, the rule is estimated to

cover approximately 85 percent of U.S. GHG emissions.
    With respect to emissions and sequestration from agricultural
sources and other land uses, the rule does not require reporting of
emissions or sequestration associated with deforestation, carbon
storage in living biomass or harvested wood products. These categories
were excluded because currently available, practical reporting methods
to calculate facility-level emissions for these sources can be
difficult to implement and can yield uncertain results. Currently,
there are no direct GHG emission measurement methods available except
for research methods that are very expensive and require sophisticated
equipment. Limited modeling-based methods have been developed for
voluntary GHG reporting protocols which use general emission factors,
and large-scale models have been developed to produce comprehensive
national-level emissions estimates, such as those reported in the U.S.
GHG Inventory report. To calculate emissions or sequestration using
emission factor or carbon stock exchange approaches, it would be
necessary for landowners to report on management practices and a
variety of data inputs. The activity data collection and emission
factor development necessary for emissions calculations at the scale of
individual reporters can be complex and costly. Due to the current lack
of reasonably accurate facility-level emissions/stock change factors
and the ability to accurately measure all facility-level calculation
variables at a reasonable cost to reporters, the reporting of emissions
and sequestration associated with deforestation and carbon
sequestration from forestry practices was excluded as a source
category.
    While this reporting rule does not require reporting by facilities
or suppliers in every source category, the U.S. GHG Inventory does
provide national estimates of emissions from all U.S. anthropogenic GHG
sources. In the case of land-based emissions, this includes all
emissions by sources and removals by sinks on lands that are managed.
The Inventory is prepared annually by EPA, in collaboration with other
Federal agencies, and is an impartial, policy-neutral report that
tracks annual GHG emissions at the national level and presents
historical emissions from 1990 to 2007. The Inventory also calculates
carbon dioxide emissions that are removed from the atmosphere by
``sinks,'' such as through the uptake of carbon by forests, vegetation,
and soils.
    Offsets projects are of interest to many stakeholders because they
could be an important component of a potential future cap and trade
system. Some commenters requested EPA to include accounting methods for
offsets in this reporting rule. We believe that this issue is beyond
the scope of this rulemaking and the Congressional request that
initiated it. However, EPA will continue to monitor policy needs and
developments in the future and is prepared to initiate additional
reporting efforts at the appropriate time.
3. Reporting by Both Upstream and Downstream Sources
    Comment: Some commenters were concerned that requiring reporting by
both fuel and industrial GHG suppliers (upstream sources) and direct
emitters (downstream sources) results in double counting of GHG
emissions and could lead to overestimation of emissions. Some
commenters thought reporting by both upstream and downstream sources
was duplicative, confusing, unnecessary, or burdensome and recommended
the rule be revised to eliminate double reporting. Other commenters
agreed with EPA's proposed selection of source categories to report and
that reporting by upstream sources and downstream sources is needed to
inform development of GHG policies and programs.
    Response: This rule responds to a specific request from Congress to
collect data on GHG emissions from both upstream production and
downstream sources, as appropriate. The rule requires reporting by
facilities that directly emit GHGs above the selected threshold as a
result of combustion of fuel or industrial processes (downstream
sources). The majority of these reporters are large facilities in the
electricity generation and industrial sectors. The rule also requires
upstream suppliers of fossil fuels and industrial GHGs to report the
GHG emissions that could be emitted from combustion or use of the
quantity of fuels or industrial gases supplied into the economy. In
many cases, the fossil fuels and industrial GHGs supplied by producers
and importers are used and ultimately emitted by a large number of
small sources. To cover these direct emissions would require reporting
by hundreds or thousands of small facilities. To avoid this impact, the
rule does not include all of those emitters but instead requires
reporting by the suppliers of industrial gases and suppliers of fossil
fuels.
    The data collected under this rule are consistent with the
appropriations language and provide valuable information to EPA and
stakeholders in the development of climate change policy and programs.
Potential policies such as low carbon fuel standards can only be
applied upstream, whereas end-use emission standards can only be
applied downstream. Data from upstream and downstream sources would be
necessary to formulate and assess the impacts of such potential
policies. Eliminating reporting by either upstream sources or
downstream sources would not satisfy EPA's data needs and policy
objectives of this rule.
    EPA acknowledges that there is inherent double reporting of
emissions in a program that includes both upstream and downstream
sources. However, as discussed in Sections I.D and IV.B of the preamble
to the proposed rule (74 FR 16448, April 10, 2009) EPA does not intend
to use emissions data collected by this rule as a replacement for the
national emission estimates found in the annual Inventory of GHG
emissions.

E. Summary of Comments and Responses on Thresholds

    This section contains a brief summary of major comments and
responses on EPA's approach and rationale for selection of reporting
thresholds. See sections III.C through PP of this preamble for
summaries of comments and responses on specific threshold analyses for
the individual source categories contained in 40 CFR part 98, subparts
C through PP. A large number of comments were received covering
numerous topics. Responses to significant comments received can be
found in ``Mandatory Greenhouse Gas Reporting Rule: EPA's Response to
Public Comments, Selection of Reporting Thresholds, Greenhouse Gases,
and De Minimis Provisions.''
    Comment: Many commenters supported the proposed threshold of 25,000
metric tons of CO2e per calendar year. These commenters
generally agreed that the 25,000 metric ton threshold level achieves a
reasonable balance between the percentage of national emissions covered
and the number of reporters, resulting in a sufficiently comprehensive
dataset while minimizing the impact on small facilities. Some also
commented that this threshold is consistent with other existing GHG
programs or likely future programs. Some commenters supported a 100,000
metric ton CO2e threshold because they believe this level
covers an appropriate percentage of national GHG emissions while easing
the reporting burden on industry. Some commenters supported an emission
threshold of 10,000 metric tons CO2e to enable collection of
emissions data for smaller

sources. Some of these commenters also noted that a 10,000 metric ton
CO2e threshold is more appropriate in order to monitor
leakage of emissions to smaller sources (since 25,000 metric tons of
CO2e is a likely threshold for future emissions reductions
mandates). Some commenters suggested quantitative evaluation of
intermediate threshold options in addition to the four evaluated by EPA
(1,000; 10,000; 25,000; and 100,000); several of these suggested EPA
analyze a threshold of 50,000 metric tons CO2e to reduce the
number of reporting facilities.
    Response: As described in the preamble to the proposed rule (74 FR
16448, April 10, 2009), EPA considered four threshold levels, as well
as capacity-based thresholds where appropriate, and we proposed a
threshold of 25,000 metric tons of CO2e for many source
categories, and capacity-based or ``all in'' thresholds for other
categories. Based on comments received, we reexamined the threshold
analyses both in general and for each industry, taking into account
additional data provided, and we considered whether there were reasons
to develop different thresholds in specific industry sectors. The
specific elements of these analyses are discussed in the relevant
source category discussions in this preamble and the accompanying
``Mandatory Greenhouse Gas Reporting Rule: EPA's Response to Public
Comments'' volumes for each source category. At the general level, we
also considered non-quantitative factors, such as consistency with
State and other programs (the majority have established thresholds for
GHG reporting at 25,000 metric tons or lower, such as 10,000 or 5,000
metric tons), and the need to select a threshold level that best
satisfies the objective of the reporting rule to collect a national
data set that is sufficiently comprehensive for use in analyzing a
range of GHG policies and programs.
    From these analyses, we concluded that a 25,000 metric ton
threshold suited the needs of the reporting program by providing
comprehensive coverage of emissions with a reasonable number of
reporters, thereby creating the robust data set necessary for the
quantitative analyses of the range of likely GHG policies, programs and
regulations. Moreover, the 25,000 metric ton threshold covers similarly
sized sources as covered by many current CAA programs (e.g., NSPS
applies PM emissions limits to oil-fired and coal-fired units larger
than 30 mmBtu per hour).\15\ And, as mentioned previously, this level
is consistent with (or higher than) the majority of other GHG reporting
programs. Furthermore, having a uniform threshold \16\ was an equitable
approach because like facilities could be compared across sectors and
no one industry would be disproportionately affected or subjected to a
lower or higher threshold. A uniform threshold is also essential for
evaluating potential policies and programs that could have a single
emissions threshold across source categories (e.g., PSD), and
simplifies the applicability determination for facilities that emit
GHGs from more than one source category under the rule.
---------------------------------------------------------------------------

    \15\ As explained in section II.A of this preamble, facilities
that only have stationary combustion units as their only source of
emissions and have units with an aggregate maximum heat input of
less than 30 mmbtu are not included in this rule.
    \16\ Although the thresholds were expressed in different ways
(e.g., ``all-in'', annual emissions) most corresponded to, or were
consistent with, an annual facility-wide emission level of 25,000
metric tons of CO2e.
---------------------------------------------------------------------------

    As discussed in Section IV.C of the preamble to the proposed rule
(74 FR 16448, April 10, 2009), we considered four potential thresholds
(the range of 1,000 to 100,000 metric tons of CO2e) and from
our analysis and the comments we concluded we had enough information to
select an appropriate threshold for the final rule and that detailed
quantitative analyses of additional intermediate thresholds would not
change EPA's decision. For example, in reviewing our threshold
analyses, we determined that the intermediate options between 25,000
and 100,000 metric tons would not provide an alternative threshold that
substantially reduced the number of the reporters relative to other
options considered or substantially improved the cost effectiveness.
(See ``Review of Threshold Analyses'' memorandum in docket EPA-HQ-OAR-
2008-0508.) Based on our proposal analysis on the data available, we
saw that the majority of the affected facilities or suppliers had
emissions either considerably above or below 25,000 metric tons
CO2e per year. (As previously explained, supplier GHG
quantities represent the emissions that could be released when the
products they supply are combusted or used.) The selected threshold
took into account our finding that while a threshold other than 25,000
metric tons of CO2e might appear to achieve an appropriate
balance between the number of facilities and emissions covered for a
limited number of source categories, there are several additional
reasons for selecting the threshold of 25,000 metric tons of
CO2e per year.
    The lower threshold alternatives that we considered were 1,000
metric tons of CO2e per year, and 10,000 metric tons of
CO2e per year. At proposal, we explained that we did not
select either of these thresholds because although both broaden
national emissions coverage, they do so by disproportionately
increasing the number of affected facilities. With the data available
at proposal and from the comment period, we remain convinced that the
1,000 metric ton CO2e/year threshold would increase the
number of reporters by an order of magnitude, thus changing the focus
of the program from large to small emitters and imposing reporting
costs on tens of thousands of small businesses that in total would
amount to less than 10 percent of national GHG emissions. Our analysis
indicates that a 10,000 metric ton CO2e/yr threshold would
approximately double the number of reporters, but would only increase
national emissions coverage by one percent. (See the Regulatory Impacts
Analysis for the final rule for the estimated number of facilities and
GHG emissions covered by the alternative thresholds examined.) While
some proposals (e.g., WCI and H.R. 2454, American Clean Energy and
Security Act) contain a 10,000 metric ton threshold for reporting, EPA
concluded for policy evaluation purposes, the 25,000 metric ton
threshold more effectively targets large industrial emitters and
suppliers, covers approximately 85 percent of U.S. emissions, and
minimizes the burden on smaller facilities.
    We also reviewed the 100,000 metric tons of CO2e per
year as an alternative threshold but concluded that it fails to satisfy
key objectives. It excludes a number of emitters in certain source
categories such that the emissions data would not adequately cover key
sectors of the economy. At 100,000 metric tons CO2e per
year, reporting for some large industry sectors would be rather
significantly fragmented, resulting in an incomplete understanding of
direct emissions from that sector. We concluded that this threshold
would not sufficiently cover the types of facilities that are typically
regulated under the CAA and would be inadequate for the intended use of
analyzing potential policies and developing future CAA programs.
    Based on our review, EPA has determined that the selected 25,000
metric ton CO2e threshold will cover many of the types of
facilities and suppliers typically regulated under the CAA, while
appropriately balancing

emission coverage and burden. At this threshold, EPA will be able to
evaluate the effects of a number of options and policies that could
address GHG emissions without placing an undue burden on a large number
of smaller facilities and sources. In addition, this threshold level is
largely consistent with many of the existing GHG reporting programs and
different legislative proposals in Congress. Furthermore, many industry
stakeholders that EPA met with and the majority of public commenters,
representing a wide variety of stakeholders, expressed support for a
25,000 metric ton CO2e threshold, agreeing with the Agency's
assessment of coverage.

F. Summary of Comments and Responses on Level of Reporting

    This section contains a brief summary of major comments and
responses on the level of reporting. A large number of comments were
received covering numerous topics. Responses to significant comments
received can be found in ``Mandatory Greenhouse Gas Reporting Rule:
EPA's Response to Public Comments, Selection of Source Categories to
Report and Level of Reporting.''
    Comment: Many commenters supported facility-level reporting rather
than corporate-level reporting. The reasons they gave included:
Facility-level reporting is consistent with most air rules and
permitting programs, environmental managers are used to facility-level
reporting, facility-level data would be needed to implement likely
future regulatory programs such as a cap and trade program, this
approach is simpler to implement and minimizes administrative burden, a
facility's corporate status can change during the year, and tying data
to physical sources makes emissions easier to track and monitor over
time. On the other hand, several commenters favored corporate-level
reporting. The reasons they gave included: The effect of GHG emissions
is global, therefore the location where the GHGs are emitted is not
important; various other GHG programs require corporate-level reporting
and have mechanisms for handling ownership changes; the overall carbon
footprint of a corporation is important; a company's entire emissions
should be reported, not just those facilities that are above a
threshold; and facility-level data are more likely to be CBI.
    Response: In response to comments, EPA reviewed our initial views
outlined in Sections IV.D and V of the proposal preamble (74 FR 16448,
April 10, 2009) in light of our data needs under the CAA, our
interpretation of the Congressional request, and the feedback received.
Based on these considerations, we determined that the final rule will
retain the same reporting level as the proposed rule. Facility-level
reporting is required, with the exception of some supplier source
categories (e.g., importers of fuels or industrial GHGs or
manufacturers of motor vehicles and engines). If a facility is covered
by the rule, the reporter must report the facility's GHG emissions from
all source categories for which the rule contains GHG emission methods.
The total emissions for the facility are reported, as well as emissions
broken out by source category within the facility. Subparts for some
source categories specify further breakout of emissions by process line
or unit.
    We retained this approach because the purpose of this rule is to
collect data from suppliers and from facilities with direct GHG
emissions above selected thresholds for use in analyzing, developing,
and implementing potential future CAA GHG policies and programs.
Facility-level data are needed to support analyses of some types of
potential GHG reduction programs, such as NSPS. The data collected from
facility-level reporting under this rule will improve our ability to
formulate a set of climate change policy options and to assess which
facilities and industries would be affected by the options and how they
would be affected. (Note, we expect that similarly, facility-level data
will also be useful to States, the public, and other stakeholders to
formulate State and regional programs and track emission trends over
time.) Reporting by individual facilities is also consistent with most
existing air regulatory such as ARP, NSPS and national emission
standards for hazardous air pollutants (NESHAP), and permitting
programs. Many facility environmental managers are already experienced
with facility-level emissions reporting under such programs and can
likewise submit reports under the mandatory GHG reporting rule.
    Corporate-level reporting was not selected because corporate
reporting without facility-specific details would not provide
sufficient data to assess many potential CAA GHG policies and programs.
EPA understands that some corporate-level GHG reporting programs have
mechanisms to establish reporting responsibilities under complex and
changing ownership situations, but we find corporate-level reporting
overly complex for this rulemaking given that facility level data are
needed, and it is simpler to place reporting responsibility directly on
individual facilities. We note that while EPA requires facility-level
reporting, it is up to the facility owners and operators to select the
designated representative who will submit the report for a facility,
and reporters can also establish any internal corporate review
processes they deem appropriate.
    While EPA agrees with the commenters who indicated that information
on corporate carbon footprints is useful for various purposes,
collection of such information is outside the scope of this rulemaking.
With that said, we are exploring options for adding additional data
elements to the reports, such as name of parent company and NAICS
code(s), to allow easier aggregation of facility-level data to the
corporate level under this program. EPA expects to subject any
additional requests to notice and comment rulemaking. In any event, we
expect that the facility-level data collected under this rule will be
useful for programs that request or require corporate reporting. But,
as explained in Sections I.D and I.E of this preamble, this reporting
rule is one action to respond to a specific request from Congress.
Various other Federal and State programs are collecting and will
continue to collect corporate-level data on direct and indirect
emissions, energy efficiency, and other data as part of a broad array
of climate change initiatives.
    For the response to the commenters' concern about CBI, see Section
II.R of this preamble.

G. Summary of Comments and Responses on Initial Reporting Year and Best
Available Monitoring Methods

    This section contains a brief summary of major comments and
responses on the initial reporting year. A large number of comments
were received covering numerous topics. Responses to significant
comments received can be found in ``Mandatory Greenhouse Gas Reporting
Rule: EPA's Response to Public Comments, Initial Year of Reporting,
Duration of the Reporting Program, and Provisions to Cease Reporting.''
    Comment: The proposed rule included reporting of calendar year 2010
emissions in March 2011, which would require reporters to collect data
starting on January 1, 2010. The preamble to the proposed rule also
discussed options of allowing reporting of best available data for
2010, or delaying reporting by one year (64 FR 16471, April 10, 2009).
Many industries with source categories covered by the proposed rule
commented that a data collection start date of January 1, 2010,

does not provide sufficient time to review the final rule, purchase and
install required monitoring equipment, train staff, and develop
internal electronic data management and recordkeeping systems needed to
comply with the rule. Many indicated that they do not currently have
all the meters and monitoring equipment required by the rule. Most of
these commenters strongly stated that calendar year 2011 should be the
first reporting year. Many of them also stated that if EPA decides data
collection must begin in 2010, a best available data approach should be
allowed for calculating and reporting 2010 emissions.
    Conversely, Congressional inquiries and a large number of public
commenters including States, NGOs, and the general public, emphasized
that data collection must start in 2010 because time is of the essence
for developing and implementing GHG policies and programs. These
commenters urged EPA to require reporting of calendar year 2010 GHG
emissions and not to delay data collection until calendar year 2011.
    Some of the commenters made suggestions about the types of data and
methods that could be allowed if EPA chose to use a best available data
approach for 2010.
    Response: EPA carefully reviewed input from all commenters with the
goal of balancing the urgent need for data against the legitimate
concerns raised regarding timing. As a result, we have revised the
approach for the final rule. The final rule requires data collection
for calendar year 2010, but has been changed since proposal to allow
use of best available monitoring methods for the first quarter of 2010.
    Schedule. EPA decided to require reporting of calendar year 2010
emissions because the data are crucial to the timely development of
future GHG policy and regulatory programs. In the Appropriation Act,
Congress requested EPA to develop this reporting program on an
expedited schedule, and Congressional inquiries along with public
comments reinforce that data collection for calendar year 2010 is a
priority. Delaying data collection until calendar year 2011 would mean
the data would not be received until 2012, which would likely be too
late for many ongoing GHG policy and program development needs.
    However, EPA understands that because the final rule is not being
promulgated until fall of 2009, facilities that do not already have the
monitoring systems required by the rule in place might not have time to
install and begin operating them by January 1, 2010. Under the schedule
in the Appropriations Act, the final rule would have been signed at the
end of June 2009, which would have allowed approximately six months to
prepare for data collection in January 2010. Given the delay in
promulgating the rule, there is less time between signature of the rule
and a January 1, 2010 start date. In light of this fact, and the
industry comments indicating that facilities do not currently have all
of the required monitoring systems, EPA has decided to provide
flexibility by establishing a best available monitoring methods option
for the first quarter of calendar year 2010. This approach will provide
time comparable to what would have occurred had EPA met the schedule in
the Congressional request. We will post the rule on EPA's Web site soon
after signature, allowing reporters to see the final requirements and
begin compliance planning even before the rule is published in the
Federal Register.
    For the time period of January 1 through March 31, 2010, the rule
allows use of best available monitoring methods for parameters that
cannot reasonably be measured according to the monitoring and QA/QC
requirements of the relevant subpart. Starting no later than April 1,
2010, the reporter must begin following all applicable monitoring and
QA/QC requirements of this part, unless they submit an extension
request showing that it is not reasonably feasible to acquire, install,
and operate a required piece of monitoring equipment by the specified
date and EPA approves the request. EPA may approve such requests for a
set time period, but will not approve the use of best available methods
beyond December 31, 2010. See the paragraph heading ``Extension Request
Process'' near the end of this response for further details.
    EPA has concluded that the time period allowed under this schedule
(including the provision for facility-specific requests) will allow
facilities that do not currently have the required monitoring systems
sufficient time to begin implementing the monitoring methods required
by the rule. In general, the required monitors, such as flow meters,
are widely available and are not time consuming to install. By allowing
the additional time, many facilities may also be able to install the
equipment during other planned (or unplanned) process unit downtime,
thus avoiding process interruptions.
    Definition of Best Available Monitoring Methods. In determining
methods that would be allowed under a best available monitoring methods
approach, EPA considered the goal of collecting consistent data to
provide information of sufficient quality to inform policy and program
development, while recognizing that not all facilities may be able to
implement the full monitoring methods required by the rule by January
2010. We reviewed the public comments as well as the California Air
Resources Board (CARB) mandatory reporting rule, and we considered
options falling between full flexibility to use any method and the full
requirements of EPA's mandatory reporting rule.
    The least stringent approach would be to allow facilities to
calculate GHG emissions using any data, methods, calculation
procedures, or emission factors they choose during the best available
monitoring period and submit minimal supporting data. This approach
would provide maximum flexibility to industry, but EPA did not select
this approach because the usefulness of the collected data would be
questionable given that it would be obtained using inconsistent methods
and it could not be verified with sufficient confidence. Instead, EPA
developed a hybrid approach that falls between full flexibility and
implementation of full monitoring requirements in January 2010. Under
the final rule, during January 1, 2010, through March 31, 2010,
reporters may use best available monitoring methods for any parameter
(e.g., fuel use, daily carbon content of feedstock by process line) if
that parameter cannot reasonably be measured following the monitoring
and QA/QC requirements of a relevant subpart. The reporter must use the
calculation procedures and equations in the ``Calculating GHG
Emissions'' sections of each relevant subpart, but may use the best
available monitoring method for any parameter for which it is not
reasonably feasible to acquire, install, and operate a required piece
of monitoring equipment by January 1, 2010. Best available monitoring
methods include the following:
     Monitoring methods currently used by the facility that do
not meet the specifications of a relevant subpart.
     Supplier data.
     Engineering calculations.
     Other company data.
    Reporters must submit an annual GHG report for 2010. This calendar
year 2010 report (submitted March 31, 2011) includes the same
information as in subsequent years, but also requires brief
descriptions of each best available monitoring method used, the
parameter measured using that method, and the

time period during which the method was used.
    EPA selected this approach because it is responsive to commenters'
concerns that monitoring equipment cannot be installed by January 1,
2010, while also ensuring timely submission of more consistent and
verifiable data than the alternatives. We have concluded that the data
will be more consistent because all reporters will use the same basic
emissions calculation equations that are in the rule, with best
available inputs, rather than the wide range of calculation methods
that would likely be used under a full flexibility approach.
Furthermore, the selected approach requires reporting of sufficient
information for EPA to verify the emissions data. We have therefore
determined that this approach for collection and reporting of the
calendar year 2010 data will fulfill the objectives of this reporting
rule.
    It should also be noted that, like the proposed rule, the final
rule allows facilities that must report only emissions from general
stationary fuel combustion equipment (and do not have other covered
source categories) to determine calendar year 2010 emissions using any
of the methods (tiers) in 40 CFR part 98, subpart C, and submit an
abbreviated GHG report. Full reporting starts with calendar year 2011.
This allows such facilities, which are less likely to have experience
with emissions monitoring and reporting, an extra year to begin full
reporting using all the procedures required by the rule.
    Extension Request Process. We expect that the vast majority of
facilities will begin complying with the full monitoring requirements
of the rule no later than April 1, 2010, and will not require or be
granted an extension. However, EPA is providing facilities with
specific circumstances an opportunity to request an extension in the
use of best available monitoring methods. EPA will review extension
requests to determine whether they should be approved. We envision that
extensions will apply primarily to situations when needed monitoring
instrumentation could not be obtained within the timeframe despite good
faith efforts by the facility, or when installation of monitoring
instrumentation would require a process unit shutdown that could not
feasibly be scheduled prior to April 1, 2010.
    Timing. Reporters must submit extension requests to EPA no later
than 30 days after the effective data of the GHG reporting rule. EPA
intends to review each submitted request and may approve or disapprove
the requests. EPA may approve the request for a specified time period,
but will not approve the use of best available methods beyond December
31, 2010. If EPA disapproves an extension request, then the reporter is
required to implement the full monitoring methods required by the rule
by April 1, 2010.
    Content of Request. Requests must contain the following
information:
     A list of specific monitoring instrumentation for which
the request is being made and the locations where each piece of
monitoring instrumentation will be installed.
     Identification of the specific rule requirements (by rule
subpart, section, and paragraph numbers) for which the instrumentation
is needed.
     A detailed description of the reasons why the needed
equipment could not be obtained and installed before April 1, 2010.
     If the reason for the extension is that the equipment
cannot be purchased and delivered by April 1, 2010, include supporting
documentation such as the date the monitoring equipment was ordered,
investigation of alternative suppliers and the dates by which
alternative vendors promised delivery, backorder notices or unexpected
delays, descriptions of actions taken to expedite delivery, and the
current expected date of delivery.
     If the reason for the extension is that the equipment
cannot be installed without a process unit shutdown, include supporting
documentation demonstrating that it is not possible to isolate the
equipment, piping, or line and install the monitoring instrument
without a full process unit shutdown. Also include the date of the most
recent process unit shutdown, the frequency of shutdowns for this
process unit, and the date of the next planned shutdown during which
the monitoring equipment can be installed. If there has been a shutdown
or if there is a planned process unit shutdown between promulgation of
this rule and April 1, 2010, include a justification of why the
equipment could not be obtained and installed during that shutdown.
     A description of the specific actions the facility will
take to obtain and install the equipment as soon as reasonably feasible
and the expected date by which the equipment will be installed and
operating.
    Approval Criteria. EPA will approve a request if it contains all of
the information required by the rule and if it demonstrates to the
Administrator's satisfaction that it is not reasonably feasible to
acquire, install, and operate a required piece of monitoring equipment
by April 1, 2010.
    For example, EPA is likely to approve a request for an extension if
the documentation provided by the reporter shows that they ordered
monitoring equipment in a timely manner, attempted to find a supplier
who could deliver it in time, and could not control the fact that the
equipment was not received for installation prior to April 1, 2010.
    If a reporter requests an extension because equipment cannot be
installed without a process unit shutdown, EPA is likely to approve
such a request if the documentation clearly demonstrates why it is not
feasible to install the equipment without a process unit shutdown,
shows there is not a planned shutdown (and has not been a shutdown)
prior to April 1, 2010, during which the monitoring instrument could be
installed. There are many locations where monitors can be installed
without a process unit shutdown, because there is often some redundancy
in process or combustion equipment or in the piping that conveys fuels,
raw materials and products. For example, many facilities have multiple
combustion units and fuel feed lines such that when one combustion unit
is not operating they can obtain the needed steam, heat, or emissions
destruction by using other combustion devices. Some facilities have
multiple process lines that can operate independently, so one line can
be temporarily shut down to install monitors while the facility
continues to make the same product in other process lines to maintain
production goals. If a monitor needs to be installed in a section of
piping or ductwork, it can be possible in some cases to isolate a line
without shutting down the process unit (depending on the process
configuration, mode of operation, storage capacity, etc.). If the line
or equipment location where a monitor needs to be installed can be
temporarily isolated and the monitor can be installed without a full
process unit shutdown, it is less likely EPA will approve an extension
request.
    While there might be other unique facility-specific situations for
which an extension might be granted, EPA expects few of these. There
have been several changes to the rule since proposal that would reduce
the need for extensions. For example, fewer source categories are
included in the final rule; changes have been made to the monitoring
requirements of some rule subparts to allow more flexibility in
monitoring methods; and provisions have been added to the general
stationary fuel combustion, petroleum refineries, and petrochemical
productions subparts allowing facilities

additional time to perform some monitor calibrations. These changes
address many of the specific situations about which commenters raised
concerns.
    It is highly unlikely we would approve extension requests for
parameters that are measured by periodic sampling and analyses.
Facilities should be able to make arrangements to collect periodic
samples and send them off-site for analyses (if they don't have on-site
analytical capabilities) without the need for an extension. Similarly,
extensions for design of electronic recordkeeping systems seem
unnecessary. Many facilities already have electronic recordkeeping
systems that can be altered to keep the records needed for this rule.
Furthermore, reporters can keep the specified records in any type of
hard copy or electronic format they choose, as long as it is in a form
suitable for expeditious inspection and review.

H. Summary of Comments and Responses on Frequency of Reporting and
Provisions To Cease Reporting

    This section contains a brief summary of major comments and
responses on the frequency of reporting and on whether reporters should
be allowed to stop submitting annual reports if emissions are reduced
below a threshold level. A large number of comments were received
covering numerous topics. Responses to significant comments received
can be found in ``Mandatory Greenhouse Gas Reporting Rule: EPA's
Response to Public Comments, Initial Year of Reporting, Duration of the
Reporting Program, and Provisions to Cease Reporting'' and ``Mandatory
Greenhouse Gas Reporting Rule: EPA's Response to Public Comments,
Subpart A: Applicability and Reporting Schedule.''
1. Provisions To Cease Reporting if Emissions Decrease
    Comment: The majority of public commenters favored annual reporting
as opposed to more or less frequent reporting. Many commenters,
especially industrial facilities required to report under the rule,
objected to the ``once in always in'' reporting approach in the
proposed rule and requested a mechanism to stop reporting if emissions
fall below the 25,000 metric tons CO2e per year annual
threshold. Others suggested a level different from 25,000 metric tons
CO2e per year to cease reporting. Some commented that the
lack of such a mechanism is a disincentive to reduce facility
emissions. Conversely, other commenters supported the proposed once in
always in approach in order to create a consistent, long term data set
covering the same population of facilities over time that could be used
to track trends and understand factors that influence emission levels.
    Response: After reviewing the comments, EPA has not changed the
frequency of reporting since the proposed rule. Affected facilities and
suppliers must submit annual GHG reports. Facilities with ARP units
that report CO2 emissions data to EPA on a quarterly basis
would continue to submit quarterly reports as required by 40 CFR part
75, in addition to providing the annual GHG reports. We have determined