[Federal Register Volume 79, Number 75 (Friday, April 18, 2014)]
[Rules and Regulations]
[Pages 21852-21855]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-08615]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R08-OAR-2014-0049; FRL-9909-08-Region 8]


Approval and Promulgation of Air Quality Implementation Plans; 
South Dakota; Prevention of Significant Deterioration; Greenhouse Gas 
Tailoring Rule Revisions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is partially 
approving and partially disapproving revisions to the South Dakota 
State Implementation Plan (SIP) submitted by the South Dakota 
Department of Environment and Natural Resources (DENR) to EPA on June 
20, 2011. The SIP revisions address the permitting of sources of 
greenhouse gases (GHGs). Specifically, we are approving revisions to 
the State's Prevention of Significant Deterioration (PSD) program to 
incorporate the provisions of the federal PSD and Title V Greenhouse 
Gas Tailoring Rule (Tailoring Rule). The SIP revisions incorporate by 
reference the federal Tailoring Rule's emission thresholds for 
determining which new stationary sources and modifications to existing 
stationary sources become subject to South Dakota's PSD permitting 
requirements for their GHG emissions. EPA is finalizing disapproval of 
a related provision that would rescind the State's Tailoring Rule 
revision in certain circumstances. EPA will take separate action on an 
amendment to the chapter Construction Permits for New Sources or 
Modifications in the June 20, 2011 submittal, regarding permits for 
minor sources. EPA is finalizing this action under section 110 and part 
C of the Clean Air Act (the Act or CAA).

DATES: This final rule is effective May 19, 2014.

ADDRESSES: EPA has established a docket for this action under Docket 
Identification No. EPA-R08-OAR-2014-0049. All documents in the docket 
are listed in the www.regulations.gov index. Although listed in the 
index, some information is not publicly available, e.g., CBI or other 
information whose disclosure is restricted by statute. Certain other 
material, such as copyrighted material, will be publicly available only 
in hard copy. Publicly available docket materials are available either 
electronically in www.regulations.gov or in hard copy at the Air 
Program, Environmental Protection Agency (EPA), Region 8, 1595 Wynkoop 
St., Denver, Colorado 80202-1129. EPA requests that if at all possible, 
you contact the individual listed in the FOR FURTHER INFORMATION 
CONTACT section to view the hard copy of the docket. You may view the 
hard copy of the docket Monday through Friday, 8:00 a.m. to 4:00 p.m., 
excluding Federal holidays.

FOR FURTHER INFORMATION CONTACT: Jody Ostendorf, Air Program, Mailcode 
8P-AR, Environmental Protection Agency (EPA), Region 8, 1595 Wynkoop 
St., Denver, Colorado 80202-1129, (303) 312-7814, 
ostendorf.jody@epa.gov

SUPPLEMENTARY INFORMATION: 

Definitions

    For the purpose of this document, the following definitions apply:
    (i) The words or initials Act or CAA mean or refer to the federal 
Clean Air Act, unless the context indicates otherwise.
    (ii) The initials DENR mean or refer to the South Dakota Department 
of Environment and Natural Resources.
    (iii) The words EPA, we, us or our mean or refer to the United 
States Environmental Protection Agency.
    (iv) The initials GHG mean or refer to Greenhouse Gas.
    (v) The initials PSD mean or refer to Prevention of Significant 
Deterioration.
    (vi) The initials SIP mean or refer to State Implementation Plan.
    (vii) The words State or SD mean the State of South Dakota, unless 
the context indicates otherwise.

Table of Contents

I. Background for Our Final Action
II. Response to Comments
III. What final action is EPA taking?
IV. Statutory and Executive Orders Review

I. Background for Our Final Action

    The June 20, 2011 submittal incorporates by reference the 
provisions of the federal PSD and Title V Greenhouse Gas Tailoring Rule 
(Tailoring Rule), that establish (1) that GHG is a regulated pollutant 
under South Dakota's PSD program, and (2) emission thresholds for 
determining which new stationary sources and modification projects 
become subject to South Dakota's PSD permitting requirements for their 
GHG emissions. The background for today's final rule, our rationale for 
disapproving the submitted rescission clause language, and EPA's 
national actions pertaining to GHGs is discussed in detail in our 
proposal (see 79 FR 8130, February 11, 2014). The comment period was 
open for 30 days and we received two adverse comment letters.

II. Response to Comments

    We received adverse comments on our proposed action, specifically 
on our proposed disapproval of the rescission clause, from the South 
Dakota DENR. We received similar comments from Otter Tail Power 
Company. After considering the comments, EPA has decided to finalize 
our action as proposed. The comments and our responses follow.
    Comment: DENR states that EPA's first proposed basis for 
disapproval was that the rescission clause would allow for revision of 
the SIP without the approval of the Administrator. EPA cited 40 CFR 
51.105, which states that revisions of a plan, or portions thereof, 
will not be considered part of an applicable plan until such revisions 
have been approved by the Administrator in accordance with part 51.
    DENR characterizes EPA as stating that the rescission clause will 
be a revision of the plan down the road that the Administrator has not 
had a chance to approve. DENR disagrees, stating that EPA has the 
chance to approve the rescission clause now. Otter Tail Power Company 
makes a similar argument, stating that 40 CFR 51.105 will not be 
violated in the event of a triggering action because the Administrator 
will have already approved the fact that the rules can be revised.
    Response: EPA disagrees with this comment. We did not say the 
rescission clause as submitted is not before EPA for approval. Instead, 
we said that we were considering whether any future change to the SIP 
that occurs as a result of the automatic rescission clause would be 
consistent with EPA's interpretation of the effect of the triggering 
EPA or federal court action. In this case, even if EPA were to approve 
South Dakota's rescission clause now, the SIP would be modified without 
any EPA interpretation of the triggering federal court action. This 
violates 40 CFR 51.105.
    Comment: DENR states that EPA approval of the rescission clause 
would not violate any public notice requirements. DENR notes that the 
public had notice and opportunity to comment on both the State's 
rulemaking

[[Page 21853]]

process and on EPA's SIP approval process; Otter Tail Power Company 
likewise states that there has already been adequate notice and 
comment. DENR states that the public is thus aware that if a court 
issues an order vacating or otherwise invalidating EPA's PSD GHG 
regulations, the South Dakota provisions will be rescinded. Otter Tail 
Power Company states that any further public notice is unnecessary.
    Response: EPA disagrees with this comment. EPA is not stating that 
there was insufficient notice that the rescission clause says what it 
says. EPA is stating that in the future there would be inadequate 
notice to the public as to the effects of a court decision. DENR does 
not dispute this, because DENR does not indicate that there is any 
notification mechanism that would take place after the court decision. 
Likewise, Otter Tail Power Company does not explain how the public 
would be adequately notified.
    Comment: DENR states that EPA's disapproval of the rescission 
clause would place an undue burden on the regulated community. 
Businesses moving to South Dakota or trying to expand would be put on 
hold until South Dakota could go through the rule process of removing 
the vacated provisions and submitting the revisions to EPA for 
approval. DENR and Otter Tail Power Company note that EPA has taken 
nearly three years to act on this submittal. Otter Tail Power Company 
states that this shows it would take a similar amount of time to remove 
the provisions from South Dakota's SIP if the PSD GHG provisions are 
stayed or vacated. DENR states a concern that without the rescission 
clause, there could be a scenario where South Dakota's SIP would have a 
requirement the State could not enforce because the underlying rule or 
law was no longer valid but a third party or EPA could attempt to 
enforce.
    Response: EPA disagrees with this comment. First, a rescission 
clause that meets the requirements we described in our proposal notice 
can become effective relatively quickly. For example, we have approved 
a rescission clause that takes effect upon EPA's publication of a 
direct final rule in the Federal Register that a court has vacated GHG 
PSD permitting requirements. 77 FR 12484 (Mar. 1, 2012). This 
triggering event serves both the purpose of public notification and EPA 
interpretation of the court decision. In that direct final rule, EPA 
stated:

    In the event of a court decision * * * that triggers (or likely 
triggers) application of Tennessee's automatic rescission 
provisions, EPA intends to promptly describe the impact of the court 
decision * * * on the enforceability of its GHG permitting 
regulations.

77 FR 12486. Thus, a rescission clause can meet CAA requirements and 
still become effective relatively quickly after a court decision, 
without need for the full SIP revision process.

    Second, South Dakota provides no evidence that any businesses would 
have to be put on hold. Most sources that are subject to PSD GHG 
requirements are subject to PSD permitting anyway due to their 
emissions of other pollutants. Furthermore, both states and EPA have 
issued many PSD permits that address GHG requirements, without any 
apparent impact on the economy.
    Comment: DENR notes that during the state rulemaking process, EPA 
commented on South Dakota's rescission clause and did not object to it, 
only asking that South Dakota remove the word ``reconsider'' from the 
provision. DENR states that this estops EPA from objecting to the 
provision now.
    Response: EPA disagrees with this comment. First, section 110(l) 
mandates that EPA cannot approve a SIP revision that interferes with 
any requirement of the CAA. Regardless of comments made during the 
state rulemaking, this requirement applies. As explained in our 
proposal notice and response to comments, EPA has determined in this 
action that the rescission clause does not comply with requirements in 
the CAA and in our regulations.
    Second, nothing in the CAA requires EPA to participate in a state 
rulemaking process or to reach a final determination during that 
process on whether a state rule meets the requirements of the CAA. In 
addition, nothing in EPA's comment stated that the revised language 
would be approvable, that the comment was EPA's final determination, or 
that the submittal would not be subject to further EPA review. And even 
if the comment had made such a statement, it would not give rise to 
estoppel, as regardless of any such statement CAA section 110(l) does 
not permit EPA to approve a SIP revision that interferes with 
requirements of the CAA. See, e.g. Utah Power & Light Co. v. United 
States, 243 U.S. 389 (1917) (``[T]he United States is neither bound nor 
estopped by acts of its officers or agents in entering into an 
arrangement or agreement to do or cause to be done what the law does 
not sanction or permit.'').
    Comment: DENR states that South Dakota is in litigation with EPA 
regarding EPA's Tailoring Rule. EPA's disapproval of the rescission 
clause is tantamount to requiring the State to waive or compromise its 
claims in that litigation by taking a contrary position in its State 
rules, and is no less than coercion.
    Response: EPA strongly disagrees with this comment. It appears to 
EPA that our disapproval of the rescission clause has no legal 
consequences for the State, nor has DENR identified any. First, there 
are no legal consequences under the CAA. A rescission clause is not a 
required element of the plan, and disapproval of it does not obligate 
the State in any way to make a new SIP submittal and does not create 
any potential for sanctions.\1\ The State's PSD program remains fully 
approved.
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    \1\ Even if this disapproval did create potential for 
sanctions--which it does not--that would not constitute coercion. 
See e.g., Virginia v. Browner, 80 F.3d 869 (4th Cir. 1996).
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    Second, there are no consequences that are relevant to the 
litigation. EPA is not requiring DENR to change anything in state law. 
Nor is EPA requiring the State somehow to affirm EPA's legal position 
in the cited litigation. The State is not required to make any response 
of any type to EPA's disapproval. There is nothing in EPA's disapproval 
of the State's rescission clause that can be characterized as coercion.

III. What final action is EPA taking?

    EPA is approving in part, and disapproving in part, the June 20, 
2011 submittal that addresses the permitting of sources of GHGs for 
incorporation into the South Dakota SIP. Specifically, EPA is approving 
revisions to Chapter 74:36:09 that incorporate the Tailoring Rule into 
the State's definitions and requirements for PSD. EPA is disapproving 
the provision that would rescind the State's Tailoring Rule revision in 
certain circumstances. EPA will take separate action on an amendment in 
the June 20, 2011 submittal to Chapter 74:36:20, Construction Permits 
for New Sources or Modifications, regarding permits for minor sources.
    EPA is approving changes to Definitions, Section 74:36:01:08(2), 
which revises the major source definition so that it applies to any air 
pollutant ``subject to regulation as required by EPA,'' and Section 
74:36:01:15(6), which adds the six GHGs designated by EPA as regulated 
air pollutants to the definition of regulated air pollutant. EPA is not 
taking action on the addition of ``(73) ``Subject to regulation'' as 
defined in 40 CFR 70.2 (July 1, 2009), as revised in publication 75 FR 
31607 (June 3, 2010), in accordance with EPA requirements,''

[[Page 21854]]

because it applies to the title V permitting program which is not part 
of the SIP.

IV. Statutory and Executive Orders Review

    Under the Clean Air Act, the Administrator is required to approve a 
SIP submission that complies with the provisions of the Act and 
applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). 
Thus, in reviewing SIP submissions, EPA's role is to approve state 
choices, provided that they meet the criteria of the Clean Air Act. 
Accordingly, this final action merely approves state law that meets 
federal requirements and disapproves state law that does not meet 
federal requirements. This action will not impose additional 
requirements beyond those imposed by state law. For that reason, this 
action:
     Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Order 
12866 (58 FR 51735, October 4, 1993);
     does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
     does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the Clean Air Act; and
     does not provide EPA with the discretionary authority to 
address, as appropriate, disproportionate human health or environmental 
effects, using practicable and legally permissible methods, under 
Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, this rule does not have tribal implications as 
specified by Executive Order 13175 (65 FR 67249, November 9, 2000), 
because the SIP is not approved to apply in Indian country located in 
the state, and EPA notes that it will not impose substantial direct 
costs on tribal governments or preempt tribal law.
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit a report containing this action and 
other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).
    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by June 17, 2014. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this action for the purposes of 
judicial review nor does it extend the time within which a petition for 
judicial review may be filed, and shall not postpone the effectiveness 
of such rule or action. This action may not be challenged later in 
proceedings to enforce its requirements. (See CAA section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Incorporation by reference, Intergovernmental relations, Lead, Nitrogen 
dioxide, Ozone, Particulate matter, Reporting and recordkeeping 
requirements, Sulfur oxides, Volatile organic compounds.

    Authority:  42 U.S.C. 7401 et seq.

    Dated: March 24, 2014.
Shaun L. McGrath,
Regional Administrator, Region 8.

    40 CFR part 52 is amended to read as follows:

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

0
1. The authority citation for part 52 continues to read as follows:

    Authority:  42 U.S.C. 7401 et seq.

Subpart QQ--South Dakota

0
2. Section 52.2170 is amended in paragraph (c)(1):
0
a. By adding table entries for 74:36:01:08 and 74:36:01:15 in numerical 
order; and
0
b. By revising table entry for 74:36:09:02.
    The amendments read as follows:


Sec.  52.2170  Identification of plan.

* * * * *
    (c) * * *
    (1) * * *

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                                                           State        EPA approval date
        State citation             Title/subject      effective date    and citation \1\        Explanations
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                                              74:36:01 Definitions
 
                                                  * * * * * * *
74:36:01:08..................  Major source defined.  4/4/1999        4/18/2014 [Insert     ....................
                                                                       Federal Register
                                                                       page number where
                                                                       the document
                                                                       begins.].
74:36:01:15..................  Regulated air          1/5/1995        4/18/2014 [Insert     ....................
                                pollutant defined.                     Federal Register
                                                                       page number where
                                                                       the document
                                                                       begins.].
 
                                                  * * * * * * *

[[Page 21855]]

 
                                74:36:09 Prevention of Significant Deterioration
 
                                                  * * * * * * *
74:36:09:02..................  Prevention of          6/28/2010       4/18/2014 [Insert     ....................
                                significant                            Federal Register
                                deterioration.                         page number where
                                                                       the document
                                                                       begins.].
 
                                                  * * * * * * *
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\1\ In order to determine the EPA effective date for a specific provision listed in this table, consult the
  Federal Register notice cited in this column for the particular provision.

* * * * *
[FR Doc. 2014-08615 Filed 4-17-14; 8:45 am]
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