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ENVIRONMENTAL PROTECTION AGENCY

Environmental Protection Agency

CFR Citation: 40 CFR Part 63

RIN ID: RIN 2060-AE79

OAR ID: [OAR-2003-0138, FRL-7551-6]

NOTICE: RULES

ACTION: Air pollutants, hazardous; national emission standards:

DOCUMENT ACTION: Final rule.

SUBJECT CATEGORY: National Emission Standards for Hazardous Air Pollutants: Organic Liquids Distribution (Non-Gasoline)

DATES: This rule is effective February 3, 2004. The incorporation by reference of certain publications listed in today's final rule is approved by the Director of the Federal Register as of February 3, 2004.

DOCUMENT SUMMARY: This action promulgates national emission standards for hazardous air pollutants (NESHAP) for new and existing organic liquids distribution (OLD) (nongasoline) operations, which are carried out at storage terminals, refineries, crude oil pipeline stations, and various manufacturing facilities. These NESHAP implement section 112(d) of the Clean Air Act (CAA) by requiring all OLD operations at plant sites that are major sources to meet hazardous air pollutant (HAP) emissions standards reflecting the application of the maximum achievable control technology (MACT).

The EPA estimates that approximately 5,300 megagrams per year (Mg/ yr) (5,900 tons per year (tpy)) of HAP are emitted from facilities in this source category. Although a large number of organic HAP are emitted nationwide from these operations, benzene, ethylbenzene, toluene, vinyl chloride, and xylenes are among the most prevalent. These HAP have been shown to have a variety of carcinogenic and noncancer adverse health effects.

The EPA estimates that the final standards will result in the reduction of HAP emissions from major sources with OLD operations by 60 percent. The emissions reductions achieved by the final standards, when combined with the emissions reductions achieved by other similar standards, will provide improved protection to the public and achieve a primary goal of the CAA.

SUMMARY: Organic liquids distribution (Non-gasoline),

SUPPLEMENTAL INFORMATION

Regulated Entities. Categories and entities potentially regulated by this action include:
Examples of regulated Category NAICS* code SIC* code entities Industry................................. 325211, 325192, 325188, 32411, 49311, 2821, 2865, 2869, 2911, 4226, 4612, 5169, Operations at major 49319, 48611, 42269, 42271. 5171. sources that transfer organic liquids into or out of the plant site, including: liquid storage terminals, crude oil pipeline stations, petroleum refineries, chemical manufacturing facilities, and other manufacturing facilities with collocated OLD operations. Federal Government....................... ......................................... ......................................... Federal agency facilities that operate any of the types of entities listed under the ``industry'' category in this table. * Considered to be the primary industrial codes for the plant sites with OLD operations.

This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be regulated by this action. To determine whether your facility is regulated by this action, you should examine the applicability criteria in Sec. 63.2334 of the final rule. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed in the preceding FOR FURTHER INFORMATION CONTACT section.

Docket. We have established an official public docket for this action under Docket ID Nos. A9813 and OAR20030138. The official public docket consists of the documents specifically referenced in this action, any public comments received, and other information related to this action. All items may not be listed under both docket numbers, so interested parties should inspect both docket numbers to ensure that they have received all materials relevant to the final rule. Although a part of the official docket, the public docket does not include Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. The official public docket is the collection of materials that is available for public viewing at the Office of Air and Radiation Docket and Information Center (Air Docket) in the EPA Docket Center, (EPA/DC) EPA West, Room B102, 1301 Constitution Avenue NW, Washington, DC. The EPA Docket Center Public Reading Room 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) 5661744. The telephone number for the Air Docket is (202) 5661742. A reasonable fee may be charged for copying docket materials.

An electronic version of the public docket is available through EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at http://www.epa.gov/edocket/ to view public comments, to access the index listing of the contents of the official public docket, and to access those documents in the public docket that are available electronically. Once in the system, select ``search,'' then key in the appropriate docket identification number. Although not all docket materials may be available electronically, you may still access any of the publicly available docket materials through the docket facility in the above paragraph entitled Docket.

WorldWide Web (WWW). In addition to being available in the docket, an electronic copy of today's final NESHAP will also be available on the WWW through the Technology Transfer Network (TTN). Following the Administrator's signature, a copy of the NESHAP will be posted on the TTN's policy and guidance page for newly proposed or promulgated rules at http://www.epa.gov/ttn/oarpg. The TTN provides information and technology exchange in various areas of air pollution control. If more information regarding the TTN is needed, call the TTN HELP line at (919) 5415384.

Judicial Review. Under section 307(b)(1) of the CAA, judicial review of the final NESHAP is available only by filing a petition for review in the U.S. Court of Appeals for the District of Columbia Circuit by April 5, 2004. Under section 307(d)(7)(B) of the CAA, only an objection to a rule or procedure raised with reasonable specificity during the period for public comment can be raised during judicial review. Moreover, under section 307(b)(2) of the CAA, the requirements established by the final rule may not be challenged separately in any civil or criminal proceeding brought to enforce these requirements.

Outline. The information presented in this preamble is organized as follows:
I. Introduction

A. What Is the Purpose of NESHAP?

B. What Is the Source of Authority for Development of NESHAP?

C. What Processes and Operations Are Included in the OLD (Non gasoline) Source Category?

II. Summary of the Final OLD NESHAP

A. What Source Categories and Subcategories Are Affected by the Final OLD NESHAP?

B. What Are the Primary Sources of HAP Emissions and What Are the Emissions?

C. What Is the Affected Source?

D. What Are the HAP Emissions Limits, Operating Limits, and Other Standards?

E. When Must I Comply With the OLD NESHAP?

F. What Are the Testing and Initial Compliance Requirements?

G. What Are the Continuous Compliance Requirements?

H. What Are the Notification, Reporting, and Recordkeeping Requirements?
III. Summary of Environmental, Energy, and Economic Impacts

A. What Facilities Are Affected by These Final NESHAP?

B. What Are the Air Quality Impacts?

C. What Are the Water Quality Impacts?

D. What Are the Solid and Hazardous Waste Impacts?

E. What Are the Energy Impacts?

F. What Are the Cost Impacts?

G. What Are the Economic Impacts?
IV. Summary of Rule Differences From Proposal

A. Rule Applicability

B. Compliance Demonstrations

C. Emission Limitations and Work Practice Standards

D. Monitoring, Recordkeeping, and Reporting
V. Summary of Responses to Major Comments

A. Rule Applicability

B. Emission Limitations and Work Practice Standards

C. Testing, Compliance Requirements, and Monitoring

D. Notifications, Reports, and Records

E. Definitions
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VI. Statutory and Executive Order Reviews

A. Executive Order 12866, Regulatory Planning and Review

B. Paperwork Reduction Act

C. Regulatory Flexibility Analysis

D. Unfunded Mandates Reform Act

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 and Safety Risks

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

I. National Technology Transfer and Advancement Act

J. Congressional Review Act
I. Introduction

A. What Is the Purpose of NESHAP?

The purpose of the final NESHAP is to protect the public health and the environment by reducing emissions of HAP from operations that distribute organic liquids.
B. What Is the Source of Authority for Development of NESHAP?

Section 112 of the CAA requires us to list categories and subcategories of major sources and area sources of HAP and to establish NESHAP for the listed source categories and subcategories. Organic liquids distribution (nongasoline) (major sources only) was included on the initial list of source categories published on July 16, 1992 (57 FR 31576). Major sources of HAP are those that have the potential to emit 10 tpy or more of any one HAP or 25 tpy or more of any combination of HAP.

Section 112 (d)(2) of the CAA requires NESHAP to reflect the maximum degree of reduction in emissions of HAP that is achievable. This level of control is commonly referred to as the MACT.

The MACT floor is the minimum control level allowed for NESHAP. This concept appears in section 112(d)(3) of the CAA. For new sources, the MACT floor cannot be less stringent than the HAP emissions control that is achieved in practice by the bestcontrolled similar source. The MACT standards for existing sources can be less stringent than standards for new sources, but they cannot be less stringent than the average HAP emissions limitation achieved by the bestperforming 12 percent of existing sources in the category or subcategory (or by the bestperforming five sources for categories or subcategories with fewer than 30 sources).

In developing MACT, we also consider control options that are more stringent than the floor. We may establish standards more stringent than the floor based on the consideration of cost of achieving the HAP emissions reductions, any nonair quality health and environmental impacts, and energy requirements, under CAA section 112(d)(2).

The NESHAP for organic liquids distribution were proposed on April 2, 2002 (67 FR 15674). This action announces EPA's final decisions on the NESHAP.
C. What Processes and Operations Are Included in the OLD (Nongasoline) Source Category?

The OLD (nongasoline) source category involves the distribution of organic liquids into, out of, or within a plant site. The distribution activities include the storage of organic liquids in storage tanks not subject to other 40 CFR part 63 standards and transfers into or out of the tanks from or to cargo tanks, containers, and pipelines. Organic liquids are those noncrude oil liquids that contain at least 5 percent by weight of any combination of the 98 HAP listed in Table 1 to subpart EEEE of part 63, and have a total liquid vapor pressure of 0.7 kilopascals (0.1 pound per square inch absolute (psia)) or greater, and all crude oils downstream of the first point of custody transfer. For the purposes of the OLD NESHAP, organic liquids do not include gasoline, fuels that are consumed or dispensed on the plant site, kerosene (No. 1 distillate oil), diesel (No. 2 distillate oil), asphalt, and heavier distillate oils and fuel oils, hazardous waste, wastewater, or ballast water. Emission sources controlled by the OLD NESHAP are storage tanks, transfer operations, transport vehicles while being loaded, and equipment leak components (valves, pumps, and sampling connections) that have the potential to leak.

The types of organic liquids and emission sources covered by the OLD NESHAP are frequently found at many types of facilities that are already subject to other NESHAP. If an emission source is in organic liquid distribution service and is already subject to an existing 40 CFR part 63 NESHAP, then that emission source is not subject to the OLD NESHAP.
II. Summary of the Final OLD NESHAP
A. What Source Categories and Subcategories Are Affected by the Final OLD NESHAP?

Today's final rule applies to the OLD source category. We did not develop any subcategories. However, OLD operations that do not meet the specified applicability criteria for relevant emission limitations and work practice standards contained in the final rule are not required to apply emission reduction measures:
B. What Are the Primary Sources of HAP Emissions and What Are the Emissions?

The primary sources of HAP emissions from the OLD source category are the loss of HAP during the filling of storage tanks with organic liquids, storage of organic liquid in storage tanks, vapor displacement during the loading of organic liquids into transport vehicles and containers, and vapor leakage from transport vehicles at transfer racks during loadings of these vehicles. The HAP emissions are also the result of leaks from equipment such as valves, pumps, and sampling connection systems. Total baseline HAP emissions from the OLD source category are approximately 5,900 tpy.

C. What Is the Affected Source?

We have defined the affected source broadly to be the collection of activities and equipment used to distribute organic liquids into, out of, or within a major source plant site. This affected source is termed the ``organic liquids distribution (OLD) operation.'' Four types of emission sources are included in the affected source: storage tanks storing organic liquids; transfer racks at which organic liquids are loaded into or unloaded out of transport vehicles and/or containers; the transport vehicles themselves while they are loading or unloading organic liquids at transfer racks; and equipment leak components in organic liquids service that are associated with pipelines and with storage tanks and transfer racks storing, loading, or unloading organic liquids.

Applicability of the final standards is not restricted to any specific industries, but to each OLD operation that meets the applicability criteria of the final rule. The final standards do not apply to any emission source that is subject to another 40 CFR part 63 rule.

The liquids regulated by the final rule consist of noncrude oil organic liquids that contain at least 5 percent by weight of any combination of the organic HAP compounds listed in Table 1 to subpart EEEE of part 63 and have a total liquid vapor pressure of 0.1 psia or greater, plus all crude oils downstream of the first point of custody transfer. Gasoline is specifically excluded from coverage by the final rule as are fuels consumed or dispensed on the plant site as well as kerosene (No. 1 distillate oil), diesel (No. 2 distillate oil), asphalt, and heavier distillate oils and fuel oils.

Regulatory overlaps are specifically addressed in the final rule. Many of the
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facilities potentially affected by the final OLD NESHAP contain activities and equipment (i.e., certain storage tanks, transfer racks, and equipment components) that are already subject to other Federal air standards (such as 40 CFR part 60, subpart Kb, for storage tanks, or subpart GGG or FFFF of 40 CFR part 63). The final rule clarifies that emission sources subject to other 40 CFR part 63 NESHAP are not subject to the OLD NESHAP. The final rule also clarifies that sources subject to other nonMACT rules must comply with the requirements of the OLD NESHAP as well as the other rules.
D. What Are the HAP Emission Limits, Operating Limits, and Other Standards?

We are promulgating the requirements of the final NESHAP in the form of HAP emission limits (i.e., percent reduction or exhaust concentration), operating limits, and work practice standards. The work practice standards are a combination of design, equipment, and operational standards.

The final NESHAP contain emission standards for storage tanks, transfer racks, transport vehicles, and equipment components at existing and new OLD operations.

The standards for storage tanks apply to tanks storing organic liquids and meeting the tank capacity and liquid HAP vapor pressure applicability criteria given in Table 2 to subpart EEEE of part 63. You have three options for control. First, you may install a closed vent system and control device with at least 95 percent control efficiency for the organic HAP listed in Table 1 to subpart EEEE of part 63. You may also choose to demonstrate that the measurement of total organic compounds (TOC) is an appropriate surrogate for organic HAP. As an alternative option to the 95 percent standard, combustion devices may meet an exhaust concentration limit of 20 parts per million by volume (ppmv) of organic HAP or TOC. Second, you may capture and route emissions to a fuel gas system or back into a process. Third, you may meet a work practice standard by using a compliant internal or external floating roof in the affected storage tank. The tank size and liquid vapor pressure applicability criteria defining tanks subject to emission reduction requirements are different for tanks at existing or new affected sources.

The owner or operator will have to install a continuous monitoring system (CMS) and establish operating limits for each control device used to control storage tanks. The CMS may be of a type to measure either organic concentration in the gas stream or an operating parameter (such as fire box temperature) of the control device. A site specific monitoring plan must be developed and submitted by the owner or operator for each emission source.

The emission limit for transfer racks is a closed vent system and control device achieving a control efficiency of at least 98 percent for the organic HAP listed in Table 1 to subpart EEEE of part 63. You may also utilize a vapor balancing system to achieve the required control efficiency. You may also choose to demonstrate that the measurement of TOC is an appropriate surrogate for organic HAP. As an alternative option to the 98 percent standard, combustion devices may meet an exhaust concentration limit of 20 ppmv of organic HAP or TOC. Only transfer racks meeting the specified applicability criteria in the final rule are required to implement emission reduction measures. The same emission limit applies to affected transfer racks at both existing and new affected sources.

The same requirements for installing a CMS and establishing operating limits for the control device applicable to storage tanks also apply to the control systems installed on transfer racks.

A work practice standard applies to pumps, valves, and sampling connection systems. These equipment leak components in organic liquids service must be included in a leak detection and repair (LDAR) program which requires the use of a detection instrument. The term ``in organic liquid service'' is defined in the final rule to mean an equipment leak component that contains or contacts organic liquids having 5 percent by weight or greater of the organic HAP listed in Table 1 to subpart EEEE of part 63. Owners and operators have the option of applying the provisions from 40 CFR part 63, subpart TT, subpart UU, or subpart H for their LDAR program. The LDAR standard applies to equipment leak components at both existing and new affected sources.

A work practice standard applies to transport vehicles (cargo tanks and tank cars) loading at affected transfer racks. Each of these vehicles must have current vapor tightness certification indicating that it has been properly tested for vapor tightness. If the vehicle is equipped with vapor collection equipment, the vehicle must be tested using EPA Method 27 on an annual basis. For vehicles not so equipped, the Department of Transportation (DOT) leak tightness standards apply, and current certification indicating that these standards have been met must be retained by the owner or operator for each vehicle that loads at affected transfer racks whether the source owns the vehicle or not. The owner or operator is not required to test transport vehicles he or she does not own, but must take adequate steps to ensure that uncertified vehicles are not loaded at affected racks. These work practice standards are the same for both existing and new affected sources.

E. When Must I Comply With the OLD NESHAP?

We are requiring that all existing affected sources comply by February 5, 2007, except for floating roof storage tanks that do not initially meet the equipment standard for storage tanks in the final rule. These tanks must be in compliance following their next degassing and cleaning, or by February 3, 2014, whichever is sooner. If the first degassing and cleaning activity occurs during the 3 years following February 3, 2004, the compliance date is February 5, 2007. Existing area sources that increase their HAP emissions or their potential to emit such that they become major sources of HAP, and thus affected sources, must be in compliance within 3 years after the date they become major sources.

Any affected source that commenced construction after April 2, 2002, at a site where there were no existing OLD operations, is a new affected source. Any affected source that commenced reconstruction after April 2, 2002, at a site that was an existing OLD source, is a reconstructed source. Emissions sources at new and reconstructed affected sources that are now in operation must be in compliance on February 3, 2004, with certain exceptions. These exceptions are due to the fact that the final rule applies to some affected sources and emission sources that would not have been covered by the proposed rule, and that in some cases the final emission standards are more stringent than were proposed. In cases where an emission source at a now operating new or reconstructed affected source would not have been required to be controlled under the proposed rule but is required to be controlled under the final rule, the emission source must be in compliance by February 5, 2007. Where an emission source at such a new or reconstructed affected source would have been subject to a less stringent control requirement under the proposed rule than applies under the final rule, the emission source must be in compliance with the final rule's requirement by February 5, 2007, and in the interim must comply with the less stringent control requirement as proposed. [[Page 5042]]

New or reconstructed sources that commence construction or reconstruction after February 3, 2004 must comply upon startup. F. What Are the Testing and Initial Compliance Requirements?

To determine the applicability of the final standards to individual operations, each OLD operation must evaluate whether any of their distributed liquids contain less than 5 percent HAP by weight and, thus, do not meet the definition of an organic liquid under the final rule. The specified test method for this is EPA Method 311 of 40 CFR part 63, appendix A, or other methods approved by the Administrator. An owner or operator may use other means (such as voluntary consensus standard methods, material safety data sheets (MSDS), or certified product data sheets) for determining the HAP content. However, if the results of an analysis by EPA Method 311 (or other approved test method) are different from the HAP content determined by another means, the EPA Method 311 (or other approved test method) results will govern compliance determinations.

Control devices used to comply with the final standards are subject to a performance test to demonstrate initial compliance with the emission limits, except that a design evaluation, conducted according to 40 CFR part 63 subpart SS, may be used for nonflare control devices.

The test methods applicable to control devices include EPA Methods 18, 25, and 25A of 40 CFR part 60, appendix A, and EPA Method 316 of 40 CFR part 63, appendix A, depending on the constituents of the gas stream being controlled and the format of the standard (organic HAP or TOC) the facility selects for its compliance demonstration. Floating roof tanks are subject to visual and seal gap inspections to determine initial compliance with the tank work practice standards. For the LDAR program for equipment components, EPA Method 21 of 40 CFR part 60, appendix A, is applicable.

Initial compliance with the emission limits for storage tanks and transfer racks consists of demonstrating that the control device achieves the required 95 or 98 percent control efficiency for organic HAP (or TOC, if used as a documented surrogate) or 20 ppmv exhaust concentration for combustion devices. The required percentage control efficiency must be applied to the Table 1 to subpart EEEE of part 63 HAP concentration found at the inlet to the control device.

Work practice standards apply to storage tanks, transfer racks, transport vehicles, and equipment components. You must perform a visual inspection before filling internal floating roof tanks. You must also conduct a measurement of seal gaps for external floating roof tanks within 90 days after filling. For transfer racks, you must ensure that vapor balancing systems or equipment for routing emissions to a fuel gas system or back to a process are properly designed and operated. For transport vehicles, you must perform vapor tightness testing for vehicles that you own and maintain documentation for all affected vehicles certifying that they are vaportight. Finally, for the equipment LDAR program, you must identify which 40 CFR part 63 subpart you are complying with and keep a record identifying the selected subpart.

G. What Are the Continuous Compliance Requirements?

If you use a control device, we are requiring that you monitor and record the operating parameters established during the initial performance test and calculate operating parameter values averaged on a daily basis. Continuous compliance is demonstrated if you collect CMS data as specified and maintain the operating limits established during the design evaluation or performance test.

If you are subject to work practice standards, we are requiring that you demonstrate continuous compliance by performing the required work practices and by keeping the records required to show that you are in compliance. For storage tanks, you must continue to perform the applicable inspections and seal gap measurement to ensure that the floating roofs continue to provide the proper control. For transport vehicles, you must continue performing the required vapor tightness testing on vehicles that you own and take steps to ensure that all transport vehicles loading at the OLD operation have the required certification. For equipment components, you must perform the required monitoring, keep the required records, and file the required reports consistent with the LDAR program you selected for the equipment components in the affected source.
H. What Are the Notification, Reporting, and Recordkeeping Requirements?

The notifications, records, and reports required by the final rule are generally consistent with the requirements of the General Provisions of subpart A of 40 CFR part 63. Two basic types of reports are required: notifications (such as the Initial Notification and the Notification of Compliance Status) and semiannual compliance, or periodic, reports. The Initial Notification apprises the permitting authority of applicability for existing sources or of construction for new sources.

The Notification of Compliance Status must be submitted within 60 days after the compliance demonstration activity has been completed. This report contains the results of the initial performance test, as well as all calculations and analyses used to show that the affected source has achieved and will continue to achieve compliance.

You are required to describe in your semiannual compliance reports any deviations of monitored parameters from reference values; failures to comply with the startup, shutdown, and malfunction (SSM) plan for control devices; and results of LDAR monitoring and storage tank inspections. These reports are also used to notify the permitting authority of any changes in CMS, processes, or controls since the last reporting period.

You are required to keep a copy of each notification and report, along with supporting documentation, for 5 years. Of these 5 years, the 2 most recent years must be kept onsite. The final rule allows electronic recordkeeping; however, you must be able to access all required records in a timely manner. You must keep records related to SSM, records of performance tests, and records for each continuous monitoring system. If you must comply with work practice standards, you also need to keep records for 5 years (the 2 most recent years must be kept onsite) certifying that you are in compliance with the work practices.
III. Summary of Environmental, Energy, and Economic Impacts A. What Facilities Are Affected by the Final OLD NESHAP?

Facilities affected by the final OLD NESHAP are those facilities that carry out organic liquid distribution activities. Most of these facilities can be grouped under three general categories: standalone (usually forhire) storage terminals; OLD operations collocated with a petroleum refinery, a chemical manufacturing plant site, or other manufacturing plant site; and crude oil pipeline pumping or breakout stations (containing crude oil tankage).

We estimate that in 1997, the baseline year for the final standards, there were approximately 279 collocated OLD operations, 86 standalone storage terminals, and 16 crude oil pipeline stations, for a total of approximately 381
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existing major source plant sites with OLD operations.

B. What Are the Air Quality Impacts?

The 1997 baseline HAP emissions from OLD operations are approximately 5,900 tpy. The final OLD NESHAP will reduce HAP from existing major sources by 3,500 tpy, a reduction of 60 percent. Such emission reductions are likely to reduce the risk of adverse effects of HAP.

Although the final OLD NESHAP do not specifically require the control of volatile organic compounds (VOC), the organic HAP emission control technologies upon which the standards are based will also significantly reduce VOC emissions from the source category. We estimate that the final OLD NESHAP will reduce nationwide VOC emissions emitted by the source category by approximately 9,900 tpy, or 70 percent, from baseline. This will have the effect of reducing adverse ozonerelated health and welfare impacts.

The final OLD NESHAP will result in small increases in other air pollution emissions from combustion devices that will be installed in the next 5 years to comply with today's final rule. These increases result both from the combustion device directly and from the electrical generating plants used to generate the electricity necessary to operate the addon controls and associated air handling equipment.

C. What Are the Water Quality Impacts?

We estimate that the final OLD NESHAP will not significantly impact water quality. The final standards do not contain requirements related to water discharges, wastewater collection, or spill containment, and no additional organic liquids are expected to enter these areas as a result of the OLD NESHAP. A few facilities may select a scrubber (depending on the specific emissions they are controlling) to control emissions from transfer racks or fixedroof storage tanks. The impact on water quality from the use of scrubbers is not expected to be significant.

D. What Are the Solid and Hazardous Waste Impacts?

We project that there will be no significant solid or hazardous waste impact. Flares, thermal oxidizers, scrubbers, and condensers do not generate solid waste as a byproduct of their operation. When adsorption systems are used, the spent activated carbon or other adsorbent that cannot be further regenerated may be disposed of in a landfill, which would contribute a small amount of solid waste. E. What Are the Energy Impacts?

The control devices used for transfer rack and storage tank control use electric motordriven blowers, dampers, or pumps, depending on the type of system, in addition to electronic control and monitoring systems. The installation of these devices would have a small negative energy impact. To the extent that some of the controlled organic liquids are nongasoline fuels, the applied control measures would keep these liquids in the distribution system and thus have a positive impact on this form of energy.

F. What Are the Cost Impacts?

We have estimated the industrywide capital costs for HAP emissions control equipment to be $49.3 million for the 381 existing sources. The capital costs include the costs to purchase and install the control equipment.

We have estimated the industrywide annual costs of the final rule are $25.1 million per year for the 381 existing sources. Annual costs include fixed annual costs, such as reporting, recordkeeping and capital amortization, and variable annual costs such as natural gas. The estimated average cost of the final rule is $7,100 per ton of HAP emissions reductions for existing sources.

G. What Are the Economic Impacts?

The increases in price for petroleum and chemical products affected by the final OLD rule are less than 0.003 percent, and the price increase for distribution service covered by the final rule is 0.1 percent. Reductions in output for petroleum and chemical products are also less than 0.003 percent, and the output reduction of distribution services is less than 0.002 percent.

None of the facilities affected are expected to close as a result of incurring costs associated with the final rule. Therefore, it is likely that there is no adverse impact expected to occur for the industries affected by the final rule, such as chemical manufacturing, petroleum refineries, pipeline operators, and petroleum bulk terminal operators.
IV. Summary of Rule Differences From Proposal

A. Rule Applicability

We made several clarifications to our intent as to the composition of the OLD source category and the affected source and the overall applicability of various requirements of the final rule. We have removed the facilitywide 7.29 million gallon throughput cutoff. We found, after reanalyzing our database, that we could not support such a cutoff, since our data reanalysis indicated that MACT floor levels of control applied to facilities below the proposed facility throughput cutoff. For the final rule, we have adopted a set of applicability criteria to be applied to each type of emission source to determine whether emission reductions are required for each specific emission source. These applicability criteria were developed from our MACT floor analysis of our database.

We have written the definition of the term ``organic liquid'' to include any noncrude oil liquid that contains at least 5 percent by weight of any combination of the HAP listed in Table 1 to subpart EEEE of part 63 and also has a total liquid vapor pressure of at least 0.1 psia, plus all crude oil downstream of the first point of custody transfer. This reflects our reanalysis of our database, which revealed that MACT floor levels of control apply to liquids with these HAP concentrations and vapor pressures. The definition also reflects our decision to eliminate the ``black oil'' exemption as proposed because we identified MACT floor controls for storage of crude oil.

In response to several comments, we clarified that the OLD final rule will not regulate any emission sources that are part of another 40 CFR part 63 MACT rule's affected source, whether those sources are actually controlled or not. We also included a new section in the final rule on how owners and operators should treat regulatory overlaps (i.e., two Federal rules with applicability to the same emission source).

The final rule also corrects several of the proposed citations to 40 CFR part 63, subparts PP, SS, TT, UU, and WW and adds new ones to make the use of the referenced provisions easier for regulated sources to understand.

B. Compliance Demonstrations

The proposed rule was unclear as to how a source could use a design evaluation as an alternative to a performance test when demonstrating initial compliance for a control device. The final rule clarifies that the design evaluation (per 40 CFR part 63 subpart SS) may only be applied to nonflare control devices. Flares are subject to specific design criteria contained in the General Provisions (40 CFR 63.11(b)).

We have changed the principal test method to be used for analyzing the organic HAP content of liquids from EPA Method 18 of 40 CFR part 60, appendix A, to EPA Method 311 of 40 CFR part 63, appendix A. The EPA Method 18 is not an appropriate method for liquid analysis of the type that will be performed under the OLD NESHAP.
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Method 18 is appropriate for determining the HAP content in air streams, not the HAP content in liquids. We are now specifying EPA Method 311 of appendix A of 40 CFR part 63, which is titled ``Analysis of Hazardous Air Pollutant Compounds in Paints and Coatings by Direct Injection into a Gas Chromatograph.'' Sources may also use alternative analytical methods with EPA's approval, or rely on supplier information, MSDS, and similar analyses that do not require the source to perform any testing. If an MSDS, or similar documentation, presents the HAP content of components of a liquid as a range, then you must use the upper end of the range of values in determining the total HAP content of the liquid. If the results of an analysis by EPA Method 311 are different from the HAP content determined by another means, the EPA Method 311 results will govern compliance determinations.

The final rule allows up to 180 days after the compliance date to conduct the initial performance tests, rather than having to conduct them by the compliance date, and, thus, makes the final rule consistent with the amended General Provisions and other MACT rules.

C. Emission Limitations and Work Practice Standards

At proposal, we specified liquid vapor pressure cutoffs to determine applicability of the storage tank control requirements in terms of the annual average true vapor pressure of the stored liquid. This format was compatible with the liquid property data in our OLD database as we had received the data from industry. For the final rule, we have determined, in response to comments and after our reanalysis of our database, that the vapor pressure basis should be consistent with other NESHAP that also specify storage tank vapor pressure cutoff levels. Therefore, we have written the basis for the applicability criteria in the final OLD NESHAP to be the annual average true vapor pressure of the total organic HAP in the stored liquid.

We have also increased the time period over which an owner or operator may achieve compliance with the work practice standards for floating roof storage tanks. For any floating roof tanks that do not currently meet the equipment requirements specified in 40 CFR part 63 subpart WW, full compliance may be achieved within 10 years after the effective date of the final OLD NESHAP, or at the next degassing or cleaning of the tank, whichever occurs first. If the first degassing and cleaning activity occurs during the 3 years following the effective date of the final OLD NESHAP, the compliance date is 3 years from the effective date of the final OLD NESHAP. Fixedroof tanks are still required to achieve compliance within 3 years after the effective date of the final OLD NESHAP.

At proposal, the emission limit and applicability throughput cutoff for transfer racks was based on each rack loading position. In re analyzing the database since proposal, we have determined that the information for transfer racks could not be verified on the basis of individual rack loading position. We have written the final rule based on the entire transfer rack to be consistent with many other MACT rules.

In response to requests by commenters and after reanalyzing our database, we added 40 CFR part 63 subpart H as one of the LDAR programs that may be used to comply with the work practice standard for equipment. We also clarified that only equipment leak components associated with the affected source need to be included in a source's LDAR program.

D. Monitoring, Recordkeeping, and Reporting

The proposed rule contained detailed procedures for performing monitoring and for carrying out quality assurance checks on the monitors. The final rule incorporates the monitoring provisions of 40 CFR part 63, subpart SS, and requires owners and operators to submit their own monitoring plan for approval by the applicable title V permitting authority. In accordance with subpart SS, the final rule allows the use of organic monitors in addition to monitors that measure an operating parameter of the control device (such as temperature). This will provide more flexibility in the way a source determines operating limits and monitors operation of control systems. In response to several comments, the averaging time for the monitored data is daily, which is consistent with 40 CFR part 63 subpart SS.

Following proposal, we reviewed the proposed requirements to file reports and keep records and determined that these requirements could be streamlined by reorganizing the pertinent rule sections and deleting certain records and reports that were duplicative or unnecessary for ensuring that sources were maintaining compliance with the standards. We also responded to comments requesting flexibility in the way a source generates and submits reports by allowing a source to combine the reports required by different MACT rules or to send the periodic reports required under the final OLD NESHAP along with those required by title V of the CAA. We have incorporated provisions to allow these forms of combined reporting, as well as an allowance for multiple Notifications of Compliance Status for the same affected source to be submitted together. We have included specific references to the periodic reporting requirements in 40 CFR part 63, subparts SS, TT, UU, and WW, which had been inadvertently omitted from the proposal. V. Summary of Responses to Major Comments

A. Rule Applicability

Comment: Several commenters stated that the Agency should revise the definition of ``OLD operation'' to be the combination or group of emission units used to transfer organic liquids into or out of a plant site in order to provide a clear definition of the OLD source category. Two of the commenters stated that EPA's definition of ``OLD operation'' is inconsistent with its source category listing. The proposed definition captures facilities that receive organic liquids but do not serve as distribution points, and from which such liquids are not obtained for further use and processing. These commenters urged EPA to limit the source category so that facilities and activities that do not serve as distribution points, or are merely managing organic liquids without distribution, are not captured in the final rule. Other commenters urged EPA to clarify that the final rule will not apply to endusers of organic liquid products, but rather only to manufacturers and distributors of those organic liquid products in the SIC/NAICS codes listed at proposal.

Response: The commenter's suggested definition for ``OLD operation'' is more appropriate for the affected source definition to clearly establish the limits of the affected source, but is not appropriate for describing the source category as a whole.

Further, we disagree with the commenters that our definition of OLD operation and, thus, the OLD source category is inconsistent with the source category listing by including facilities that receive organic liquids without further distributing them to end users. We consider the distribution network to include both outgoing and incoming transfers and storage of organic liquids, whether offsite or onsite. Thus, while the types of facilities identified by the commenters may never distribute the liquids offsite, the activities, equipment, and emissions that occur at such receiving and enduse facilities are part [[Page 5045]]

of the overall organic liquid distribution network.

The final rule is clear that the source category includes OLD operations that are collocated with other (such as manufacturing) activities at major source plant sites. Since the source category includes distribution operations in many industrial categories, we have not included any reference to SIC or NAICS codes in the final rule.

Comment: One commenter noted that the Technical Support Document (TSD) indicates that ``tanks and other liquid handling equipment involved solely in activities within the plant site would not be considered to be OLD emission sources * * *,'' but the provisions of the proposed rule and the definition of ``OLD operation'' do not support this position.

Similarly, commenters recommended that the affected source not include dedicated equipment used to transfer and store organic liquids between onsite process units.

Response: Our intent for the final rule is to reduce HAP emissions from the storage and transfer of organic liquids within a distribution network. It is our judgment that the distribution network ends only when the organic liquids reach a final destination where they are consumed or are introduced into an operation included in another source category. Therefore, the OLD network includes the transfer and storage of organic liquids involving any equipment identified in the affected source for OLD and that are not subject to another MACT rule. Further, in our judgement, there is no practical difference in the types of equipment in use and the types of available emission controls are identical for both inter and intraplant site transfers.

Based on these considerations, it is our intent that equipment used to store or transfer organic liquids that occur ``within'' a plant site are considered part of the OLD distribution network and part of the OLD affected source unless such equipment is subject to another MACT standard. Therefore, we have not excluded from the final rule ``tanks and other liquid handling equipment involved solely in activities within the plant site,'' and we have written the definition of OLD operation to include transfers and storage of organic liquids ``into, out of, or within a plant site.'' Thus, if an emission source meets the relevant HAP content, vapor pressure, and capacity or throughput criteria, the emission reduction requirements of the final rule apply to that emission source even if it transfers or stores organic liquids wholly within a plant site.

Comment: Several commenters requested that EPA clarify the relationship between applicability and affected source. These commenters felt that restricting the affected source to only those emission points that are subject to controls could result in a very narrow definition of the affected source. It could also result in triggering the MACT new source requirements by the addition of a relatively small component to an OLD operation, if the rest of the OLD operation were exempt from controls. This does not appear to be EPA's intent, but rather an inadvertent consequence of the manner in which the proposed rule addresses emission points that are exempt from controls.

Another commenter stated that EPA's proposed affected source definition is unlawful because EPA chose a broad definition that allows equipment to be replaced without the replacement becoming a new source.

Response: We agree with the commenters that the proposed rule did not contain a clear definition of the affected source, primarily because of confusion that occurred as the result of the two different definitions of ``affected source'' that were inadvertently created in the proposed rule.

While the intent of proposed Sec. 63.2338(b)(2) was to provide additional detail to supplement the definition in Sec. 63.2338(b)(1), we understand the confusion that this created by appearing to present a different and conflicting affected source definition. In the final rule, we have defined ``affected source'' as ``* * * the collection of activities and equipment used to distribute organic liquids into, out of, or within a facility that is a major source of HAP.''

We also agree with the commenters that the affected source should include all of the pertinent emission sources without regard to the applicability criteria that cause certain equipment to be subject to different requirements of the final rule. Therefore, the final rule, in Sec. 63.2338(b), presents a description of the affected source in which all of the pertinent emission sources are listed, without regard to their control requirements under the final rule. We have also written Sec. 63.2338(b)(1) to define the affected source as ``the collection of activities and equipment.'' This clarifies our intention to have a broad interpretation of affected source.

We acknowledge that a broad definition in many circumstances allows individual emission points (such as a single storage tank, pump, etc.) to be replaced without the new source standards being applied to that new piece of equipment. Using a broad definition of affected source is, however, within our discretion in selecting the best approach for the standards for a particular source category. The term ``affected source'' refers to the collection of processes, activities, or equipment to which a MACT standard applies. In other MACT rules, we have adopted either a broader or narrower definition of affected source for given categories depending on the nature of particular MACT requirements and the strategies available for meeting them. A broader definition permits emission reduction requirements to apply to a larger group of processes, activities, and equipment. This approach encourages owners or operators to develop and utilize more innovative and economically efficient control strategies. Using a narrower definition of affected source frequently leads to difficulties for facilities in managing differing requirements for individual pieces of equipment without achieving substantive emission reduction.

For the purpose of determining MACT, however, we chose to utilize the approach of examining the emission sources individually. In our industry survey, we requested data for each emission source rather than from the entire OLD operation. By evaluating the data on an emission source basis, we were able to establish MACT floors for each type of emission source without having to consider how each facility controlled emissions on a facilitywide basis. For example, we established MACT floors for storage tanks based on facilities with the best controlled storage tanks, even if those facilities did not utilize the best controlled transfer racks.

Our selected approach for the final OLD NESHAP is consistent with the 40 CFR part 63 General Provisions, as amended (67 FR 16582, April 5, 2002), which adopt a broader definition of affected source such that future MACT standards will generally adopt a definition of affected source which consists of all existing HAPemitting equipment and activities that are at a single contiguous site and are within a specific category or subcategory.

Comment: Several commenters recommended that compounding, blending, and packaging operations be included in the affected source, but with no control requirements. According to the commenters, this would result in a more accurate investment basis for OLD operations at a site, would clarify which MACT affected source these operations are associated with, and would avoid the potential for future regulatory overlap. [[Page 5046]]

One commenter supported the inclusion of small containers (pails, drums, portable tanks, and isotainers) as part of the OLD affected source but urged that small containers be excluded from controls in the final rule.

Response: We have written the definition of affected source in the final rule to include storage tanks and transfer racks used to store or transfer organic liquids regardless of the particular operation or activity such tanks and transfer racks were supporting, including such operations and activities as packaging, blending, and compounding.

We have not defined the affected source to single out the operations identified by the commenter because the changes that were made to the definition provide the necessary clarity. The final rule makes it clear that equipment used in operations such as these would be part of the affected source if they meet the general criteria of storing or transferring organic liquids and they are not subject to another MACT rule. Equipment meeting the affected source criteria in Sec. 63.2338 of the final rule are to be included as emission sources in the initial Notifications and Reports required under Sec.Sec. 63.2382 and 63.2386 of the final rule.

Finally, we have included containers in the definition of affected source. This is consistent with how we have redefined the affected source to include equipment even if control is not required under the final rule. The reanalysis of our data after reviewing the public comments resulted in a finding that the floor level of control for existing container filling operations is no emission reduction. We did, however, identify a MACT floor level of control for new source container filling. As discussed in more detail later in this preamble, we have determined that there are no feasible or costeffective beyond thefloor alternatives for the filling of containers at existing sources. Therefore, the final rule includes control requirements only for container filling operations that are new sources.

Comment: A number of commenters stated that the inclusion of cargo tanks as part of the affected source is inappropriate. These commenters pointed out that third parties typically provide cargo tanks and they are not generally under the common control of the OLD facilities. The commenters also stated that, if the OLD operation owner purchases either new cargo tanks or a fleet of existing cargo tanks, they should not be included in the reconstruction cost evaluation and potentially trigger new source MACT requirements at the OLD operation.

Response: As discussed in the proposal preamble and the TSD, and in previous rulemakings including the Gasoline Distribution MACT NESHAP (40 CFR part 63, subpart R), cargo tanks (consisting of tank trucks and tank cars, and renamed as ``transport vehicles'' in the final rule) can be a significant source of emissions while being loaded at transfer racks. Transport vehicles (whether owned/leased by the facility or operated by other firms) must be included in the affected source to ensure that MACT control will extend to these sources. As the final rule makes clear in Table 4 to subpart EEEE of part 63, the owner or operator must have vapor tightness documentation for each transport vehicle loading at an affected transfer rack. Third parties in many cases will be responsible for getting periodic testing (EPA Method 27 or DOT test) performed and for providing the certification papers to the facilities.

The acquisition of additional transport vehicles, whether by the source owner or by third parties, would not be included in the reconstruction cost evaluation and would not trigger any different control requirements for the liquid transfer operation. The items that define the affected source are the stationary infrastructure of the facility; that is, the combination of tanks, transfer racks, and equipment leak components. The primary mission of transport vehicles is transporting the liquids on roadways. Thus, they are not part of the stationary infrastructure of the facility. The objective of the ``reconstruction'' provisions of the CAA is to prevent an existing source from avoiding more stringent new source standards by perpetually rebuilding existing equipment rather than installing new equipment. The purchase of transport vehicles should have no impact on the triggering of more stringent standards for the storage tanks or transfer racks at an affected source. Also, at an OLD operation, facilitywide emission rates are impacted by the size, throughput capacity, and number of storage tanks and transfer racks. From the standpoint of overall emissions, it makes no difference if one vehicle is loaded ten times or if ten identical vehicles are loaded once. Therefore, the number of individual transport vehicles or the acquisition of additional transport vehicles should not be included as part of the infrastructure of the facility that is considered in determining ``reconstruction'' cost. The acquisition of additional containers by an owner or operator of an OLD facility would also not be considered in the determination of ``reconstruction'' costs.

Comment: Three commenters stated that EPA needed to clarify that only pipelines with equipment leak components (i.e., pumps, valves, or sampling connection systems) associated with a storage tank or transfer rack included in the affected source will be subject to the LDAR requirements. Commenters requested that a pipeline that transfers organic liquids directly to or from a process unit that does not pass through a transfer rack or storage vessel subject to the rule is not to be included in the affected source or in the calculation of throughput used in applicability determinations.

Commenters also stated that the exclusions from the OLD rule should include pipeline equipment leak components used to directly transfer organic liquids across plant site boundaries into or out of storage tanks not subject to another MACT standard or process equipment that are not storage tanks, and unloading facilities and pipeline equipment used to transfer organic liquids from ships, barges, tank trucks, or tank cars into a storage tank covered by other MACT standards or process equipment that are not storage tanks.

Response: Pipelines themselves are not and never were part of the affected source definition. Only equipment leak components that are part of a pipeline were considered part of the affected source at proposal. We know of no reason as to why equipment leak components associated with a pipeline that transfers organic liquids should not be part of the affected source for the final rule, regardless of whether the organic liquid being transferred is deposited in a storage tank subject to the final rule or to another MACT standard. If the pipeline's equipment leak components are subject to another MACT standard, then they are not subject to the final OLD NESHAP. If the pipeline's equipment leak components are not subject to another MACT standard and the pipeline is in organic liquids service, then the equipment leak components are subject to the requirements of the final OLD NESHAP.

Finally, the final rule does not include a facilitylevel throughput calculation to determine whether or not a facility is subject to the final rule. Therefore, there is no longer a need to clarify the relationship of pipelines to the throughput applicability determination.

Comment: We received a large number of comments concerning the proposed applicability criteria of 7.29 million gallons per year, which would
[[Page 5047]]
have excluded facilities from the OLD rule if their facility throughput was less than 7.29 million gallons of organic liquids. Several commenters supported the cutoff and requested clarification on the procedures for determining throughput. Other commenters questioned the appropriateness of excluding from control those facilities that are in the source category and have emission sources that could be controlled by the final OLD rule.

Response: We proposed a facilitylevel throughput cutoff believing it was a useful criterion to identify smaller facilities at which controls would not be required based on our understanding that such facilities were not typically required to be controlled under other rules. We reanalyzed the database to determine if MACT floors existed for facilities with throughputs less than 7.29 million gallons of organic liquids, and determined that MACT floors exist for facilities with throughputs of less than 7.29 million gallons. Therefore, we can not support the proposed 7.29 million gallon cutoff.

However, as a result of our reanalysis of the database, we determined that throughput cutoffs for certain emission points were justified. The throughput cutoffs are now a part of the applicability criteria used to determine which transfer racks are subject to control.

Comment: Several commenters requested clarification of the relationship between the OLD rule and other existing rules and future rules.

Response: We agree with the commenters that the final OLD NESHAP must be explicit in describing the specific applicability of other 40 CFR part 63 NESHAP for sources that potentially may be drawn into more than one subpart. Section 63.2338(c)(1) of the final rule states that storage tanks, transfer racks, and equipment leak components that are part of an affected source under another 40 CFR part 63 NESHAP are excluded from the definition of affected source, even in cases where the other rule does not require a reduction in emissions from the emission source.

Comment: Several commenters stated that EPA needs to address overlap between the OLD NESHAP and other non40 CFR part 63 existing rules, such as the Storage Tank New Source Performance Standard (40 CFR part 60, subpart Kb), the Benzene Storage Tank and Benzene Transfer Operations NESHAP (40 CFR part 61, subparts Y and BB, respectively), and Resource Conservation and Recovery Act (RCRA) regulations.

Response: We have written 40 CFR 63.2396 to address the overlap between the final OLD NESHAP and those rules cited by the commenters. If meeting the requirements of another rule does not result in an owner or operator fully meeting the requirements of the OLD NESHAP, then the owner or operator must modify the compliance methods to come into full compliance with the OLD NESHAP while remaining in compliance with the other rule.

Comment: One commenter, whose facility is subject to 40 CFR part 63, subpart Y (Marine Loading), pointed out that 40 CFR part 63, subpart SS, Sec. 63.983(b) and (c), imposes an initial leak detection standard for closed vent systems that is more stringent than the detection standard contained in subpart Y; Sec. 63.983(c)(1)(v) specifies only the use of methane for calibration of the instrument used to conduct the initial EPA Method 21 sweeps in subpart SS, while subpart Y is more flexible; subpart Y and subpart SS conflict on the response required if a leak is found; and, for closed vent systems that contain bypass lines, subpart Y contains an exemption on closure requirements for

FOR FURTHER INFORMATION CONTACT For further information concerning applicability and rule determinations,
[[Page 5039]]
contact the appropriate State or local agency representative. If no State or local representative is available, contact the EPA Regional Office staff listed in 40 CFR 63.13. For information concerning the analyses performed in developing the NESHAP, contact Martha Smith, U.S. EPA, Emission Standards Division, Waste and Chemical Processes Group, C43903, Research Triangle Park, North Carolina 27711, (919) 5412421, smith.martha@epa.gov.