This is a preliminary document prepared by a subgroup member of the National and Regional Strategies Work Group as part of the Federal Advisory Committee Act (FACA) Subcommittee process. It is not an EPA document. This document has not been reviewed by the work group and is subject to further work group discussions. The issues and options for this topic are still being developed by members of the subgroup. No effort has been made to develop recommendations. Interested people should forward their comments to a member of the National and Regional Strategies Work Group.

Reasonable Further Progress

Date: February 12, 1997

Status: Draft #4- RFP Subgroup discussion on February 5 and 7, 1997 (includes pros&cons from 1/28 draft)

Contact: Sarah Peirce-Sandner, Telephone 716-588-6477, FAX 716-722-3695

Introduction

This paper addresses Phase II implementation issues associated with reasonable further progress (RFP) requirements for the proposed ozone and fine particulate (PM-fine) national ambient air quality standards (NAAQS).

Note: The RFP issue has been explored in the Reasonable Further Progress Metrics paper by Alan Krupnick (October 16, 1996) and in the Reasonable Further Progress Requirements in the Areas of Influence (AOI)/Areas of Violation (AOV) thought piece by Don Theiler (October 8, 1996). Readers are encouraged to refer to these papers for additional insight.

In the case of regional haze, EPA is required to promulgate regulations to assure reasonable progress toward the national visibility goal. The program currently requires states to update regional haze long-term strategies every three years and EPA to report progress every five years. The Regional Haze Issue Paper (November 12, 1996) recommends coordinating reasonable progress requirements for the regional haze program with RFP reporting requirements for the NAAQS. Readers will find a complete discussion of options and recommendations in the Regional Haze paper.

Background

States have been required to meet the NAAQS for ozone and particulate matter in nonattainment areas. The concept of RFP was first used when EPA was developing a comprehensive tracking system to assess ozone control programs implemented by the States to meet the NAAQS. RFP was defined as the annual incremental reductions in emissions of the relevant air pollutant as are required by regulations or may be reasonably required by the Administrator for the purpose of ensuring attainment of the applicable national ambient air quality standard by the applicable date. The primary purpose of the RFP program was to track and verify whether emission reductions expected to occur as a result of State Implementation Program (SIP) regulations were being achieved. Prior to 1990, the RFP program had three principle requirements: (1) an initial listing in the SIP of sources to be tracked and their projected emissions; (2) an annual updating and RFP status report; and (3) a periodic update of the emissions inventory.

Ozone nonattainment areas have since been classified as either marginal, moderate, serious, severe, or extreme. All ozone nonattainment areas classified as moderate and above are required to submit a SIP revision by November 15, 1993, which describes, in part, how the areas will achieve an actual VOC emissions reduction of at least 15 percent during the first six years (i.e., November 15, 1990 through November 15, 1996). The SIP revision must describe how any growth in emissions from 1990 through 1996 will be fully offset. In addition, ozone nonattainment areas that are classified as serious and above are required to demonstrate how the plan will provide for the attainment of the ozone NAAQS by the applicable attainment date and will result in RFP after the first six years. RFP is defined here as VOC emissions reductions of at least three percent of baseline emissions each year averaged over three-year periods until the ozone NAAQS is attained. NOX emission reductions could be substituted for the VOC requirement where an ozone concentration reduction equivalent to that which would result from the VOC reduction was achieved.

Areas violating the particulate matter (PM-10) ambient air quality standard are classified as either moderate or serious and are required to submit a SIP containing measurable interim steps that show incremental progress towards attaining the NAAQS. PM-10 nonattainment areas are required to submit an implementation plan that includes quantitative emissions reductions milestones that are to be achieved every three years and that demonstrate RFP until the area is redesignated attainment. Each State must demonstrate to EPA within 90 days after milestone due date, that all the SIP measures have been implemented and the milestone has being met. Under the current program, the State is required to submit a SIP revision if it fails to submit the quantitative milestone demonstration or EPA determines the milestone has not been met. The SIP revision must assure that the State will achieve the next milestone by the applicable date and/or achieve the PM-10 standard by the applicable date if there is no next milestone. The starting point for this three year period (i.e., milestone clock) was the due date of the implementation plan containing the control measures for the area (November 15, 1991). EPA chose this date over the actual submittal date of an area's implementation plan because (1) it was included in the statute of specific SIP submittal and attainment deadlines, and (2) would not allow States that submit SIPs late to defer meeting their quantitative milestones and, consequently, making RFP toward attainment of the PM-10 standard.

The Interim Implementation Policy (IIP), which was proposed in November, 1996, will take effect on the date of the NAAQS promulgation and will remain effective until the date of EPA approval of the SIP for achievement of the new NAAQS. The proposed IIP continues the current ozone and PM-10 RFP requirements until the EPA has approved the new SIP for the new NAAQS. The IIP modifies existing ozone RFP requirements by allowing nonattainment areas to take credit for emission reductions from sources outside the nonattainment area so long as the sources are no farther than 100 km (for VOC sources) or 200 km (for NOX) away from the nonattainment area.

ISSUES

Why are we doing RFP? (What about RFP differs from the attainment demonstration?)

RFP is a tracking system used to assess control programs implemented by the States to meet the NAAQS. There are two schools of thought on how RFP can be assessed. The first defines RFP as the demonstration of timely progress toward the NAAQS demonstration. Under this model, RFP is the milestones along the path towards the area's attainment of the standard. The second model to assess RFP views it as the incremental improvement in air quality to reduce exposure to unhealthy air. This model uses air quality related indicators such as emissions inventories or ambient air monitoring to assess RFP. The driving force behind this model is that an area cannot make up for lost time in terms of air quality.

SIP ISSUES -- HOW SHOULD RFP BE DEFINED?

1. Is RFP standardized or can RFP be customized?

Option 1 - Standardized - Uniform metrics and frequency nation-wide (current RFP process).

Pros: Equity across nations at to what is required.

Cons: Some problems may be unique to airshed. May not be most cost effective solution. Different areas may require reduction of different pollutants.

Option 2 - Customized - Can choose the metric and frequency at the AOI level.

Pros: Different areas may require reduction of different pollutants.

Cons: Competition among State/Regions. Difficult to determine what customized will be (fuzziness). Time factor - may require a longer period of time to complete. Possible lack of achieving reductions.

Option 3 - Hybrid of Options 1 and 2. (Examples - Standard metric with rate and magnitude to achieve RFP being customized; List of mandatory measure that must be done plus customized for remaining emission reductions; A light rail system for which discernable emission reductions will not occur until 10 years; Standard constraints or rules in terms of what can be customized.)

2. What are the range of options for the RFP metric? (Two types of progress which can be measured by the metric: planning and administrative versus cleaning up the air.)

Option 1 - Demonstrated reduction in precursor emissions for ozone and precursor/direct emissions for PM-fine (current program for ozone). (For the potential role of regional institutions to standardize emissions inventories see the issue paper entitled, Institutional Mechanism for Development and Implementation of Regional Strategies.)

Pros: This is the clearest method and the traditional method. Mechanisms are already in place, and some guidance has already been developed.

Cons: PM-fine nonattainment areas with no inventory, monitoring or speciation data cannot use this method immediately. A demonstrated reduction in precursor emissions alone does not guarantee reductions in population exposure (health risks). If an area relies solely on reducing the emissions inventory, the reductions may be poorly targeted (e.g., NOX is reduced when VOC reductions would have been more effective). Emissions are not the same as ambient concentrations. In a Cap and Trade program, who gets the credit for reductions for RFP purposes?

Does this include mandatory measures (e.g., national programs such as Title II, III, and IV)?

Option 2 - Demonstrated reduction in precursor/direct emissions with different weights assigned as to the effectiveness of those reductions (e.g., VOC reactivity, location of reduction relative to violation, etc). (See the draft issue paper Reasonable Further Progress Metrics written by Alan Krupnick and Deirdre Farrell, October 16, 1997)

Pros: In theory, this is a better measure of reduction strategy since it would take into account all the factors distinguishing one ton of precursor emissions from another as affecting ambient air quality. Precursor chemicals that contribute most to ambient concentrations could be targeted for the most reductions. May be beneficial when integrating ozone and PM-fine control strategies. More reflective of local conditions or airshed conditions. This could be a customized approach.

Cons: This definition may transcend the science available to the States. This is a great idea but how would the State implement it in a robust scientific manner. In a Cap and Trade program, who gets the credit for reductions for RFP purposes?

Option 3 - Demonstrated reduction in NAAQS pollutant concentrations (air quality monitoring data or modeled results), instead of precursor/direct emissions (adjusted for meteorological extremes, other factors). Trends analyses should be performed.

Pros: This parameter supports efforts to protect human health and welfare.

Cons: This parameter may not be indicative of what really is happening. Existing methods for adjusting ozone monitoring data for meteorological and other factor still have a degree of uncertainty. Methods to adjust PM-fine data may not exist and may vary for area to area. How would PM-fine nonattainment areas make this demonstration in the absence of monitoring data. In a Cap and Trade program, who gets the credit for reductions for RFP purposes?

Option 4 - Demonstrated reduction in NAAQS pollutant concentrations (air quality monitoring data or modeled results) weighted for population exposure.

Pros: This approach may help prioritize resources by protecting the highest number of people per dollar spent on making progress toward NAAQS attainment.

Cons: Population weighting places a lower "value" on the health of people living in less densely populated areas. In a Cap and Trade program, who gets the credit for reductions for RFP purposes?

Note: The Monitoring Incentives ad hoc group is addressing this issue. This is not a stand-alone option; it would be used in conjunction with the one of the above options.

Option 5 - Administrative Actions such as:

a) Planning control strategies;

b) Adopting Rules;

c) Investments on measures (e.g., purchase of right-of-way for light rail system); or

d) Deployment of ambient air quality monitors.

Pros: For some control strategies this may be only way to measure progress.

Cons: Not considered a traditional measure of RFP. May only be valid during interim period.

Option 6 - Any combination of the above.

3. How frequently should Reasonable Further Progress be demonstrated? (Dependent of the RFP metric)

If demonstrated through emission inventories.

- Annually

- Every 2 to 3 years

If demonstrated through monitoring data.

- Annually

- Every 2 to 3 years

- Dependent on the control program implemented

4. What is the base year for RFP?

Option 1 - Fixed year - Uniform nation-wide

Option 2 - Variable according to SIP process. Possible base year date include, but not limited to SIP submittal, SIP approval, Guidance available from EPA, promulgation of standard, a year prior to promulgation of standard, designation of area.

5. What would be the rate of RFP?

Option 1 - Standardized - Percent of base year emissions inventory. (Currently used for ozone program - 3 percent per year.)

Option 2 - Customized - Percent of emissions reduction estimated for attainment. (Reduction divided by time period.)

6. Can measures that are part of end-loaded strategies be credited toward RFP early in the process?

Option 1 - No. The measures can only be credited toward RFP when they occur.

Option 2 - Yes. If there is activity that is real (secondary indicators) or meets milestones (effective progress). Activities under this option include, but are not limited to, investment, achieving administrative and planning milestones (progress estimate), and achieving construction milestones.

7. What is the corrective mechanism to get an area back on-track when the area has failed an RFP milestone? (Failure to plan versus failure to achieve planned improvements in air quality.)

Emissions Based: Economic sanctions on pollutants not reduced (e.g., graduated fee)

Pollutant Concentration Based:

Failure to achieve emission reductions - Economic sanctions

Reductions achieved but plan was flawed - Mid-course correction, remedial planning, and catch-up requirement.

AND YET TO COME!

8. Can voluntary control measures be credited in the RFP process?

Option 1 - No.

Option 2 - Yes. How should it be credited?

9. Should the RFP requirements for ozone and PM-fine and the reasonable progress (RP) requirements for regional haze be integrated?

Option 1 - No.

Option 2 - Yes. How should they be integrated?

10. Is there an out for RFP? (Assuming the NAAQS is unattainable.)

Option 1 - No.

Option 2 - Yes.

a) When cost per unit health risk reduction is exceedingly high.

b) When attainment of the NAAQS becomes impossible (i.e., all possible measures have been taken and the area cannot demonstrate attainment of the NAAQS) the area can:

I) propose a mid-course correction and continue improvements at a lesser rate, or

ii) pay into a fund that allows for research into measures that will eventually control expensive reductions.

PRE-SIP ISSUES (The time between promulgation of the new standard and approval of the SIPs under the new standard)

1. For areas that are designated as Areas of Violation (AOV) under the new/revised NAAQS, what should the RFP requirement(s) be until the SIP for the AOV/AOI is approved? (Refer to the draft issue papers entitled Treatment of Areas in which Air Quality Trends Indicate the Risk of becoming an Area of Violation and Safe Harbor/Early Initiatives, for issues concerning suspected AOVs)

Option I - RFP is not required under the new/revised NAAQS until SIP approval. Continuation of existing programs and approved pending programs (including the IIP). (Should there be an out for areas that demonstrate overwhelming transport problem?)

Pros:

Cons: Additional environmental progress during the interim period would not be made. Emissions from new sources, modified sources and/or mobile sources during the interim period may potentially increase.

Option II - RFP is required under the new/revised NAAQS. The following questions are to be considered when choosing this option.

1. When should RFP requirements kick in?

Option 1 - Official designation of AOV (uniform AOV designations)

Option 2 - Official designation of AOV (varying AOV designation dates)

Option 3 - Identification of a preliminary AOI.

Option 4 - Official designation of a final AOI (i.e., Control Region).

Option 5 - Submittal of the SIP to EPA.

Option 6 - Proposed approval of the SIP by EPA.

Option 7 - RAMP decides.

Pros: The earlier the area starts, the more rapid the progress the area will make to attain the standard and protect human health and the environment.

Cons: Until sufficient data has been collected, it will be unclear whether it is necessary to undertake the effort. Areas without historical data will have a less comprehensive understanding of the magnitude and/or nature of the problem and thus may not know the appropriate types and levels of controls. Areas with an abundance of data may not implement the most effective strategies because sufficient time for modeling is needed to determine the appropriate controls.

Another issue is when are the demonstrations due. This needs to be added as an issue.

2a. What actions could be used to demonstrate RFP in the final AOI (control region) once established?

Option 1 - Administrative actions (e.g., data gathering -- emission inventory development, monitoring, modeling).

Pros: Advances knowledge of what the problem is and how to solve it. An emissions inventory if the first step in SIP development and in future RFP requirements in the area is designated as nonattainment.

Cons: PM-fine emission factors, especially for rural areas, may not exist.

Option 2 - Prevent emissions growth.

Pros: Prevents air quality problems from getting worse.

Cons: The degree of emissions growth avoidance may be difficult to determine (dependent on nature and size of problem). Does not make progress towards attaining the standard.

Option 3 - Promote voluntary reductions.

Pros: Provides the area with more rapid progress toward attaining the standard.

Cons: The degree to which voluntary reductions can be "safe harbored" will affect ultimate progress to attaining the standard. (See Safe Harbors and Early Incentives issue paper.) Difficult to determine the amount of emission reductions that would be achieved.

Option 4 - Require mandatory emission reductions.

Pros: Increases likelihood the area will reach attainment should there be a nonattainment designation.

Cons: In the absence of the scope and nature of the problem, the area may not use the most cost-effective control strategy.

Option 5 - Require section 182 reductions.

Option 6 - Reduce population exposure.

Option 7 - Process that increases stringency of RFP requirements as milestones are missed.

Option 8 - Any combination of the above.

2b. What actions could be used to demonstrate RFP in a preliminary AOI?

Option 1 - Do nothing.

Option 2 - Administrative actions (e.g., data gathering -- emission inventory development, monitoring, modeling).

Pros: Increases likelihood the area will reach attainment should there be a nonattainment designation.

Cons: In the absence of the scope and nature of the problem, the area may not use the most cost-effective control strategy.

Option 3 - Prevent emissions growth.

Pros: Prevents air quality problems from getting worse.

Cons: The degree of emissions growth avoidance may be difficult to determine (dependent on nature and size of problem). Does not make progress towards attaining the standard.

Option 4 - Promote voluntary reductions.

Pros: Provides the area with more rapid progress toward attaining the standard.

Cons: The degree to which voluntary reductions can be "safe harbored" will affect ultimate progress to attaining the standard. (See Safe Harbors and Early Incentives issue paper.) Difficult to determine the amount of emission reductions that would be achieved.

Option 5 - Require mandatory emission reductions.

Pros: Increases likelihood the area will reach attainment should there be a nonattainment designation.

Cons: In the absence of the scope and nature of the problem, the area may not use the most cost-effective control strategy.

Option 6 - Require section 182 reductions.

Option 7 - Reduce population exposure.

Option 8 - Process that increases stringency of RFP requirements as milestones are missed.

Option 9 - Any combination of the above.

2c. What actions could be used to demonstrated RFP in an AOV if not part of an AOI?

Option 1 - Do nothing.

Option 2 - Administrative actions (e.g., data gathering -- emission inventory development, monitoring, modeling).

Pros: Increases likelihood the area will reach attainment should there be a nonattainment designation.

Cons: In the absence of the scope and nature of the problem, the area may not use the most cost-effective control strategy.

Option 3 - Prevent emissions growth.

Pros: Prevents air quality problems from getting worse.

Cons: The degree of emissions growth avoidance may be difficult to determine (dependent on nature and size of problem). Does not make progress towards attaining the standard.

Option 4 - Promote voluntary reductions.

Pros: Provides the area with more rapid progress toward attaining the standard.

Cons: The degree to which voluntary reductions can be "safe harbored" will affect ultimate progress to attaining the standard. (See Safe Harbors and Early Incentives issue paper.) Difficult to determine the amount of emission reductions that would be achieved.

Option 5 - Reduce population exposure.

Option 6 - Any combination of the above.

3. What would be the rate (magnitude) of RFP?

Option 1 - Standardized - Percent of base year emissions inventory. (Currently used for ozone program - 3 percent per year)

Option 2 - Customized - Percent of emissions reduction estimated for attainment. (Reduction divided by time period.)

Attachment 1

Guidance Documents for RFP Requirements

1.	Guidance on the Adjusted Base Year Emissions Inventory and the 1996 Target for the 15 Percent Rate of Progress Plans. EPA-452/R-92-005. Prepared by the Office of Air Quality Planning and Standards, U.S Environmental Protection Agency, Research Triangle Park, NC, 27711. October 1992.

2.	Guidance for Growth Factors, Projections, and Control Strategies for the 15 Percent Rate-of-Progress Plans. EPA-452/R-93-002. Prepared by the Office of Air Quality Planning and Standards, U.S Environmental Protection Agency, Research Triangle Park, NC, 27711. March 1993.

3.	Guidance on the Relationship Between the 15 Percent Rate-of-Progress Plans and Other provisions of the Clean Air Act. EPA-452/R-93-007. Prepared by the Office of Air Quality Planning and Standards, U.S Environmental Protection Agency, Research Triangle Park, NC, 27711. May 1993.

4.	Guidance on Preparing Enforceable Regulations and Compliance Programs for the 15 Percent Rate-of-Progress Plans. EPA-452/R-93-005. Prepared by the Office of Air Quality Planning and Standards, U.S Environmental Protection Agency, Research Triangle Park, NC, 27711. June 1993.

5.	40 CFR Part 52 - State Implementation Plans; General Preamble for the Implementation of Title I of the Clean Air Act Amendments of 1990; Proposed Rule. 57 FR 13498-13570. April 16, 1992.

6.	Guidance on the 15 Percent Rate-of-Progress Plans and the Attainment Demonstration Due November 15, 1993. Teleconference Workshop (Session 1--April 30, 1993; Session 2--May 5, 1993; Session 3--May 13, 1993; Session 4--June 11, 1993). Office of Air Quality Planning and Standards, Ozone/Carbon Monoxide Programs Branch, U.S. Environmental Protection Agency, Research Triangle Park, NC 27711.

7.	Guidance on the Post-1996 Rate of Progress Plan and the Attainment Demonstration. Teleconference Workshop. May 3-5, 1994. APTI Course 016. Office of Air Quality Planning and Standards, Ozone/Carbon Monoxide Programs Branch, U.S. Environmental Protection Agency, Research Triangle Park, NC 27711.