FINAL MEETING MINUTES

FACA Subcommittee for Ozone, Particulate Matter and

Regional Haze Implementation Programs

April 8-9, 1997

Fairview Park-Marriott

Fairfax Ballroom

3111 Fairview Park Drive

Falls Church, Virginia

Tuesday, April 8, 1997

Opening Remarks - William Hamilton (U. S. Environmental Protection Agency, Designated Federal Official)

Mr. Hamilton welcomed everyone to the meeting and recognized the meeting's co-chairmen, Alan Krupnick (Resources for the Future) and John Seitz (U.S. EPA). He covered general procedures for raising questions, using microphones, and explained the meeting schedule. Mr. Hamilton also announced that minutes from the February meeting were final and on the TTN; the Phase II management report could be found on the table out front. He noted that the June meeting would be held in Research Triangle Park, and the August meeting would be in Portland, Oregon. The October meeting location had not been determined. Mr. Hamilton asked those whose travel costs were being paid by EPA to return their travel vouchers as soon as possible. He also stated that although the meeting was being held for the benefit of Subcommittee members, at the end of the meeting, they would have a brief questions/answer period for the general public , if time permitted.

Introductions and Opening Remarks - John Seitz/Alan Krupnick

Mr. Seitz informed those present that since the Subcommittee's last meeting, EPA had sent letters to 21 individuals asking them to be members of the Subcommittee. He said that the EPA Administrator was not as concerned over the growth of the Subcommittee as she was interested in getting diverse representation on the issues. Mr. Seitz announced that Don Theiler would be leaving the State of Wisconsin Air Program, praising his excellent work on the Subcommittee and noting that he would be going to a job in wastewater treatment in the State of Washington. Mr. Theiler would be replaced as co-chair of his Work Group by Joe Belanger of the State of Connecticut. Mr. Belanger would be helping David Mobley of EPA on the NRSWG.

Mr. Seitz announced that the next afternoon the Subcommittee would need to deal with what they had accomplished to this point in a document commonly called the white paper. Lydia Wegman (Deputy Director of OAQPS) had worked with Sally Shaver to put together the information. Ms. Wegman planned to make a presentation the next day after lunch that would display what EPA was hearing up to this point in the FACA process. Mr. Seitz hoped Subcommittee members would stay to hear the presentation.

Mr. Seitz said there had been interest expressed in hearing the status of the Ozone Transport Assessment Group (OTAG) and its work. He said that OTAG was composed of the 37 eastern States and came into being at a time when these States were having difficulty in providing EPA with a valid attainment demonstration because of problems associated with boundary conditions used in modeling. On March 2, 1995, a policy was issued stating that EPA would give time for the States to present new information and provide them the opportunity to do some basic research. Mary Gade (Illinois) chaired the OTAG process. Modeling, led by Bob Shinn of New Jersey, and Control Strategies, led by Bob Shavardous of Ohio, made up the two major groups in OTAG. OTAG had completed three basic sets of runs: base case modeling; control strategy runs on large regional areas; and smaller-scale regional runs using the same control strategies. The area was divided into fine and coarse grid domains. OTAG's next meeting was scheduled for April 15-17, 1997, to discuss its recommendations to the Administrator about regional controls. Mr. Seitz said that EPA's perspective on OTAG had not changed. The SIP call would be in three phases: identify States that contributed significantly to transport based on OTAG analyses; issue a ruling in Summer 1997 for proposed reductions; and finalize the rule in Fall 1997 after receiving public comment. Mr. Seitz noted that the work of OTAG was relevant to the Subcommittee's work on control strategy options, interim implementation, and related items. OTAG had done a great number of analyses, and perhaps the Subcommittee should take a look at some of OTAG's technical data, especially, as they moved into Phase II of the FACA effort.

John Elston (State of New Jersey DEP) noted that OTAG was not just a modeling program. There was a lot of data on observational and monitoring techniques that were being incorporated into OTAG, and some information from NARSTO also was being included.

Coordination Group Report (Phase I Report) - Sally Shaver (EPA)

Ms. Shaver noted that EPA had tried to discuss and incorporate most of the Subcommittee's comments in the final version of this report. The name of the report had been changed from the Phase I Report to the Initial Report, based on comments received from the Subcommittee. Also, a statement had been added to the Executive Summary that tried to reflect that the degree of consensus reached at this time might not be indicative of the level of consensus that would be reached at the end of this process. The table on page 2.2 of the report showed the level of consensus reached on the issue papers at this time.

Ms. Shaver said that EPA was making the report available to all members of the Subcommittee. Additional copies also would be available by contacting William Hamilton. Alan Krupnick would be distributing this report on Capitol Hill in the coming weeks. The table on page 2.2 did not show a lot of ones, indicating that they had not reached consensus on a lot of the issue papers. Some people had raised concern that it looked like a job not completed very well or in a timely manner. Ms. Shaver asked Bill Becker to elaborate on the Coordination Group discussions of the previous day.

Bill Becker (STAPPA/ALAPCO) said that there had been an enormous amount of effort put into the report, not only by EPA, but by many others. He was disappointed in the low level of consensus and voiced this concern. Mr. Becker noted that ultimately the report would go to the EPA Administrator. Ms. Shaver asked whether this was not a lost opportunity to reach consensus on more of the issues. The Coordination Group decided that it would try to develop a set of holistic solutions that would draw all of the information together before presenting anything to the Administrator. Mr. Becker said they would take the sets of options and devise one set of options that the Subcommittee could agree on. It would be similar to the white paper that Lydia Wegman was compiling, but it had some different characteristics.

Sally Shaver said they would discuss the situation further on the next call of the Coordination Group. She told Subcommittee members that if they had suggestions to please get them to her as soon as possible. For control strategies, EPA realized that a lot of information had not yet been formalized, but their ideas and comments were appreciated.

Alan Krupnick added that the Coordination Group noted it might be a little premature to make "horse trading" decisions. They most likely would have three meetings after July in which to attempt to reach some consensus.

William Hamilton said that they would rearrange the agenda, skipping the report on Mobile Sources and going to the update on the Implementation Time Line.

Three-part Implementation Strategy for Ozone and PM NAAQS and Regional Haze -- Sally Shaver

Schedule

Interim Implementation Policy

Proposed 12/96

Final 7/97

Phase I Notice

Propose 7/97

Final 2/98

Phase II Notice

Propose 7/98

Final 7/99

Phase I final date has been moved-up to February 1998.

What's in Phases I and II

Phase 1

Planning

Designations

Regional haze rule

Phase II

Classifications

Attainment dates

Control strategies

Economic incentives/trading

New source review

What Phase I Notice Covers

5-step planning process

RAMPS

Designating areas

Regional haze program

Direction for Phase II

Initial SIPs (Section 110)

Response to failure to plan/incentives to participate

Some of the issues originally slated for Phase I had obviously been moved forward to Phase II. The notice would be released in July 1997 along with the promulgation of the standards.

Jim Shrouds (Federal Highway Administration) asked what the earliest date would be for SIP submittal.

Sally Shaver said Subpart D SIPs would be due three years after promulgation.

Tom Maslany (EPA) asked whether the dates would differ for PM and ozone.

Sally Shaver said the final rules would address both. Since the SIPs were keyed from designation, then the dates might differ.

Sarah Peirce Sandner (Eastman Kodak) asked for clarification on Section 110 SIPs, wanting to know what else besides visibility was contained in it and what EPA's expectations were for 110 SIPs.

Sally Shaver said that those were some of the general authorities that the States had for addressing monitoring. She asked Jan Tierney to address Sarah Pierce Sandner's question on Section 110 SIPs.

Jan Tierney (EPA, Office of General Counsel) stated that it would be mostly modeling, monitoring, and inventories and there are some inventories to address transport and what the States need..

Sally Shaver said it was not the attainment SIP.

David Hawkins (NRDC) added that Section 110(a) also says that States are responsible for a plan to attain the standards. Thus, he would disagree that attainment did not belong in a 110 SIP.

Vince Brisini (GPU Genco) asked what EPA was finding that was deficient in the current SIPs, what the bases were for these deficiencies, and what would become the metric for determining the process to develop a new SIP. Mr. Brisini asked what would be acceptable to EPA.

David Hawkins said he was not responding for EPA, but that States had to respond in a specified period of time.

John Seitz said he thought there were two issues. One was under part of Section 110 that dealt with basic modeling and monitoring activities. The second issue under 110 was for a State to demonstrate attainment.

Jan Tierney said that Section 110(a)(2)(a) did have a provision for control measures. Section 110(a) also had an option for a State to show attainments within three years. She said EPA was working at meshing this with Section 172 requirements.

Issue Paper Linkage Discussion -- Joe Paisie (EPA)

Mr. Paisie said he was trying to provide some substance to the management plan. In Attachment A2 in the Management Plan, there was a flow chart generated at the Subcommittee's Denver meeting. Some of the terminology needed to be updated (e.g., control regions are now AOIs, Regional Planning Areas are now RAMPs). Mr. Paisie said the last time the Subcommittee saw the Management Plan, it was blue. Now it was yellow. They would see another version, and only Mr. Hamilton knew what the color would be. Mr. Paisie noted that he said all of this to indicate that the Plan was very much a work in progress, and it would continue to change.

Mr. Paisie said there were two basic topics: Control Regions and Control Strategies. (See Handout #1 from joint Work Group meeting of Monday, April 7, 1997). The flow diagram in the handout attempted to show the many intricate linkages between the individual issue papers and the two basic groups mentioned above. This example showed that issue papers could go both ways between Control Regions and Control Strategies. Hopefully, in future presentations these linkages would be used to formulate the questions presented, begin to show how the papers were related, and provide a roadmap for drawing all of the information together. Mr. Paisie said the purpose of the handout was to lay everything out at the front end, and help the Subcommittee begin to visualize the relationships.

John Seitz asked whether these were the issues that would be addressed as they moved into Control Regions.

Joe Paisie said yes, it was what was relevant to a Control Region, when the attainment date was, etc.

John Seitz said it outlined the technical information and infrastructure programs that needed to be put in place for a control region. They basically had to manage all of this information at one time.

Joe Paisie said that there was an opportunities matrix, which would be presented later, that would talk about a broad spectrum of control strategies. There could be an additional block for mobile source control issues.

Susan Studlien (EPA, Director, Region I) said it would be helpful to have this diagram included in the Management Plan.

David Hawkins said he thought that the chart boiled down to answering two questions -- what to do about improving air quality, and where to do it.

Joe Paisie agreed that those were the questions at the heart of the matter; but they were subdividing the issues into many smaller parts.

Overview of the Mobile Source Program--Gay MacGregor (EPA, Office of Mobile Source Programs)

John Seitz said that the Subcommittee had discussed a great number of stationary and area source issues. There had been a request from the Subcommittee to see where EPA was with the mobile source problem.

Margo Oge [EPA, Office of Mobile Source Programs (OMS)] began by introducing persons there from OMS: Gay MacGregor, Director of Regional Programs; Mark Wolcott; John Hall; and Dee North.

Gay MacGregor began her presentation. She said her goal was to provide an overview of the Mobile Source Program.

Emissions

NOx Emissions - 49% Mobile Sources

VOC Emissions - 37% Mobile Sources

PM -- 6% from traditionally inventoried sources (re-entrained dust); PM-10 was 27% of that 6%

Technology Based Standards

New vehicle/engine standards

Compliance programs, including certification, Selective Enforcement Audits (SEA), recall

Fuel strategies

Activity-based strategies

Transportation measures

Market measures

Seasonal/voluntary measures

Degrees of Progress: Uncontrolled Levels vs. Current Planned Standards

LDV: VOC 98%; NOx 90%

LDT: VOC 96%; NOx 80%

Onboard vapor canisters: VOC 95%

HDE highway: NOx 83%

Nonroad diesel: 63% NOx

Small gas: VOC 60%

Marine: VOC 75%

Locomotive: NOx 60%

Ms. MacGregor showed two graphs on reductions in nonattainment areas. From 1950 to 1995, vehicle miles traveled (VMT) increased 37%. While some predicted that this trend would continue, there was other evidence that showed it could be declining. Some of the gains that had been made in emissions reductions thus might be offset by increased VMT. There also was an increase in Light Duty Truck/Sport Utility Vehicle/Van usage in this country, which was alarming to OMS because emissions requirements for these vehicles were less stringent than those for automobiles.

Vehicle Engine Strategies -- Bob Larson (EPA OMS)

Light Duty Vehicles (LDV) and Light Duty Trucks (LDT)

Tier 1 standards

Enhanced evaporative emission controls

Onboard vapor recovery

National LEV program

Revised exhaust emission test procedure

Tier 2 study

Tier 1 LDV and LDT

More stringent hydrocarbon and NOx standards

NMHC 0.31 g/mi

CO 4.2

Enhanced Evaporative Emissions

More stringent standards and test procedures

Added "running loss" control

Phase-in model years 1996-1999

On-Board Vapor Recovery

Refueling emissions prevented with on-vehicle controls

Phase in model years 1998-2000

National LEV Program

FRM May 1997

Tighter exhaust emission standards

Fleet average of TLEV, LEV and ULEV

Phase in

1997 model year start in Northeast Ozone Transport Region

2001 model year nationwide

Voluntary program

Benefit: reduction of 780 tons/day

Revised Exhaust Emission Test Procedure

Adds aggressive driving mode and air conditioning operation

Phase in model year 2000-2002

Benefit: reduction in tons per summer day

Tier 2 Study

Statute suggests 0.125 g/mi NMHC @ 100,000 miles

1.7 g/mi CO

0.2 g/mi NOx

Beginning 2004 model year

Study will consider:

Air quality needs

Technology

Cost effectiveness

Impact of sulfur

Statement of Principles

Innovative approach for regulation development

Involve direct stakeholders

Key issues identified:

Pre-regulatory framework

Especially useful in discretionary rules

Agreement "in principle" at start of regulatory development

Agreement signed by key stakeholders

Would not limit EPA's authority or responsibility

Standard operating procedures for:

Heavy duty highway

Non-road diesel

Small handheld

Small non-handheld

HD Highway Regulations

FRM Summer 1997

2.4 g/bhp-hr NMHC + NOx

Beginning 2004

50% NOx reductions compared to 1998 standard

Benefits: by year 2020

1999 Technology Review

Reaffirm feasibility of standards

Engine technology work by EPA begins

EMA/API/EPA/States/Users Work Group

Emissions sensitivity of key diesel fuel parameters

Non-road Diesel Regulations

Coverage includes:

All land based

Marine 0-50 HP

No underground mining equipment

Phase in by category

NPRM in Summer 1997

Benefits by 2010:

800,000 tons/year NOX

200,000-300,000 tons/year PM (~ 50% reductions)

Bob Larson also presented a Matrix Chart for Phase-In Procedures that showed pictorially the process for phasing in standards.

John Seitz asked whether the matrix reflected impacts on the inventory, whether the matrix was related to the previous slide, and whether the non-road diesel regulations would be fully implemented by 2008.

Bob Larson said they did not represent the impact on the inventory.

John Seitz whether OMS had any projections for the inventories.

Bob Larson said no, he did not have a routine number. Diesel engines typically had long life spans.

Alan Krupnick asked whether OMS assumed certain turnover rates beginning in 1997, and what fraction of the fleet they represented.

Bob Larson said all new engines sold beginning in 1999 would meet these standards.

Alan Krupnick said he was aware of that but wanted to know how they judged the reasonableness of the turnover.

Gay MacGregor said that there were different fleets in this category.

Alan Krupnick said he understood the aggregation problem. However, he wondered whether the huge number of tons of reduced emissions that OMS was projecting were real.

Gay MacGregor said that some of the reductions were for sources that had not been regulated in the past, so the reductions were quite large.

Bob Larson said that for passenger cars, the fleets were very large and they had been regulated for years. However, while the g/mi reductions were very small, the number of miles traveled was quite large.

John Seitz said he was interested in what incentives could be offered to replace the smaller engines.

Gay MacGregor said that there were more than 80 different diesel engine types.

John Seitz said he wanted to get at the incentives necessary to motivate the turnover in the older engines.

Alan Krupnick said they were presenting the programs rather than the issues. The Subcommittee wanted to get to the issues and not necessarily the control strategies.

Margo Oge said that there was an opportunity for market incentives. They were talking about almost 100 different kinds of equipment. They had a set of regulations in place that would push the technology envelope. They needed voluntary activities to encourage the turnover of the fleet; these engines would vary in life span from 5 to 30 years.

Alan Krupnick said they had not mentioned anything with respect to cost. If the costs were high, there would be no incentive to stimulate the turnover of the fleet. He thought a comparison with Tier 2 also was necessary.

Gay MacGregor said they did not have any cost estimates at this time for fleet turnover. In setting the standards for these new engines, the Clean Air Act Amendments of 1990 asked them to study these new offroad engines, and they completed their report in 1991. When one was dealing with this number of engines, there was broad category of engines differing greatly in costs. There also were similar engines used in different applications.

Mike Wright (Steelworkers Union) spoke about off-road diesel and asked why underground mining equipment would be exempt, stating that just because it was underground did not mean that it would not vent to the atmosphere. He said it was especially problematical if one was downwind. Mr. Wright said the Mine Worker Safety group would be reviewing these emissions for worker safety, which might provide a good opportunity for inter-agency collaboration.

Gay MacGregor said they had worked with the Mine Worker Safety Agency in the past, but they had very specialized concerns and there were issues about jurisdiction.

Mike Silverstein (State of Colorado Air Pollution Control) remarked on ozone action days. He said Colorado would encourage EPA to develop policies for these intermittent types of control measures for all pollutants. This approach was immensely useful for marginal areas.

Gay MacGregor said she would discuss this approach further in her next presentation.

Steve Gerritson (LADCO) asked about the May 1997 proposed rule making on national LEV, and wondered how the negotiations were going and whether the plans were realistic.

Margo Oge said OMS was hopeful that the dialogue would continue, and that the rule would be promulgated in May. They were fairly certain that the final rule would be signed in May.

Beverly Hartsock (Texas NRCC) asked whether the diesel engines were durable.

Margo Oge said they were pretty durable for NOx, but they were concerned about the PM estimates. OMS believed that there would be deliberation, which they currently were addressing.

Bill Becker said that this OMS program was not unlike the stationary source strategies that EPA used. They expected new stationary sources to employ state-of-the-art technologies. As the older facilities shut down, these new sources would become the existing sources, and eventually they would become old and go offline. Since these were national rules, it was very important to maximize the emissions reductions from any of the new categories. The lost emissions reductions opportunities would have to be made up in another sector of the emissions community. Thus, if it was lost here, it might be more costly to gain these reductions from other sectors of the industrial community. Mr. Becker said they must take advantage anywhere they could to reduce emissions.

Alex Johnson (CCCA) said he would like to see the gains and possible tradeoffs of any reductions in toxic and greenhouse gasses and asked whether these considerations were being included in OMS's analyses.

Margo Oge said these were really NOx/PM/VOC control strategies. As they would see later, there were programs to address toxics and other pollutants.

Gay MacGregor said that as they reduced hydrocarbons, they were realizing toxics reductions as well.

Alex Johnson asked whether there were not tradeoffs here, e.g., reductions in benzene that would increase formaldehyde emissions.

John Seitz said there definitely were tradeoffs. The tradeoffs should be addressed in the control strategies matrix, because they go far beyond mobile sources.

John Elston noted that Mr. Larson's presentation was technology-based. He was concerned about the process they were discussing with regard to stakeholder involvement. Mr. Elston said he understood that there was a certain lead-time associated with new technologies. They were seeing a number of strategies coming on line at or after the turn of the century that would show benefits in 2010 to 2020. This was long after State SIPs had been implemented. Also, the SIPs would have been implemented at far greater cost than what was being discussed here.

Margo Oge said this was not a small group of stakeholders getting together and "cutting a deal". The statute was very clear on this: no new standards could be set prior to 2004. She said OMS was working with the California Air Resources Board (CARB) to put forward some controls on heavy duty diesel truck engines before 2004. OMS thought that by 1998, cleaner engines would be coming out. As far as the process, OMS worked with the regulated community to develop a blueprint, and received a number of comments before publishing the final rules. If Mr. Elston looked at the statement of principle, he would see great modifications from the initial blueprint to the final rule that would be proposed in May. Ms. Oge thanked Mr. Elston for allowing her to clarify her position.

John Elston said he did not want to put Ms. Oge on the defensive on this issue. A maximum number of stakeholders should and could be involved. He said that there were lot of people who had not been involved in the process. There were a number of issues that could come up. Mr. Elston asked whether the mid-term correction would have the leeway to allow for technological changes in the short-term.

Margo Oge said the statement of principle was a blueprint document that had gone through the standard regulatory process. It had been commented upon, revised, and did reflect stakeholder participation.

*** BREAK ***

Richard Dworek (U.S. Steel) had a process comment. He noted that later they would be discussing the opportunity matrix, and he had found the matrix to be very helpful. It would be good to include the information presented this morning in the matrix, so if they could get copies of the mobile source information it would be helpful. Also, Mr. Dworek said if OMS had a conversion factor for PM-10 to PM-2.5, he would like to receive that information also.

Bruce Hill (Appalachian Mountain Club) asked whether EPA had looked at diesel I/M.

Alan Krupnick said they were going to get to it.

Mr. Larson returned to his presentation.

Small Engine Regulations

Less than 25 HP

Hand-held

30% HC and NOx reduction from Phase I

2002-2005 phase in

Non hand-held

NPRM in Fall 1997

Benefits: Year 2020

Locomotive Regulations

NPRM Court ordered 1/97

40% reduction by 2005

60% reduction after phase-in

2% reduction in nationwide inventory

Rebuild provisions, Phase I and Phase II standards

Benefits by 2010: 380,000 tons NOx

Regulations for Compression Marine Greater than 50 HP

NOx

IMO standards for international ships (9.8 g/kW hour beginning in 2000)

EPA standards for "domestic" ships

NPRM: 9.2 g/kW-hr in 200

Options: standard closer to land-based non-road

Aircraft Regulations

Commercial aircraft engine standards set by ICAO

ICAO considering 15% NOx reduction, phase in 2000-2008

Benefit: less than 15% since some engines are cleaner than the existing standard

Compliance Program Emphasis

Assure compliance with only necessary resource burden

Roll out of new programs for non-road

Emphasis on in-use performance

Developing in-use program

Diesel Smoke Test

Guidance document

SAE J1667 - "Snap Idel Test"

Publish this spring

Cutpoints issue

States, EMA, ATA work group

SIP credits issue

Correlation with gross emitters

Urban Bus Retrofit

Public transit buses 1993 and earlier

Urban areas over 750,000 people

Two certification options

25% reduction in PM

0.1 g/ghp-hr

Begin implementation this year

Bob Palzer (Sierra Club) said he was interested in the reason why the reductions OMS was looking for in locomotives and aircraft were in NOx, while for the buses the reductions were in PM.

Bob Larson said that the urban bus retrofit program was focused on PM; for the other engines, there were NOx-based strategies. Locomotives were very large sources of NOx emissions but very small sources of particulate emissions. Particulate emissions from diesel locomotives were approximately 0.1% of the total; and thus not very important.

John Seitz said he found the presentation very helpful. As EPA started looking at control strategies, they could see a variety of strategies available to provide SIP credits. He thought it would be useful to develop a matrix that summarized all of the options, their implementation dates, and when the benefits could be anticipated. Mr. Seitz also would like to explore incentives for early buy-ins to some of these programs.

Gay MacGregor said they were trying to do this for one of the other Work Groups. They were looking at what percentage of fleet turnover occurs and over what time periods.

Margo Oge said they had been looking at this issue, and were trying to incorporate as much of their information as possible into the rulemaking.

John Seitz said they needed a timeline relative to SIP submission.

Gay MacGregor said they had members on the market incentives work group who were addressing the timeline.

Margo Oge told Mr. Seitz to let OMS know what the Subcommittee needed, and she would send the proper people to help.

David Baron (Arizona Center for Law in the Public Interest) asked whether national aggregate figures reflected the inventories currently available for certain specific communities. For example, in Phoenix, direct mobile source emissions produced 50 percent of the PM-fine.

Gay MacGregor said that Mr. Baron was correct, the numbers were all national average emissions, and they would vary substantially across the country.

David Baron said then that the national numbers were of extremely little value with respect to constructing national control strategies, except maybe for the transported component of the emissions.

Gay MacGregor said that was very true. However, the first part of this presentation was simply to show the Subcommittee what OMS had done in the past and what OMS was planning to do in the near future. She said that they cannot do inventories for specific cities (e.g., Phoenix). However, OMS could develop emission factors for the cities to use.

David Baron said this raised a policy issue for the Agency. A number of these hearings on new engines seemed to focus on NOx control as opposed to PM control. He feared that this focus was biased by the notion that PM emissions were not that important. Mr. Baron hoped that EPA would focus more in the future on direct PM emissions.

Gay MacGregor said that the technology they used in the methods were good, but not totally inclusive. OMS had been focused in the past on ozone, NOx, and VOC. Their test procedures were being stretched to include PM. OMS was not reluctant to do this, it just took time and millions of dollars to develop stringent test procedures that EPA could support.

Bob Larson noted that when NOx was reduced, nitrates, and thus some PM, were reduced.

Alan Krupnick said there was only an hour left to hear the rest of the transportation presentation.

David Baron said he would strongly encourage EPA to accelerate the diesel portions of the control programs.

Gay MacGregor said they had a couple of initiatives to do this over the next few years. Whether they could be accomplished remained to be seen.

Carter Keithley (Hearth Products Association) asked whether the slides would be available and whether there were documents that described this information in more detail.

Margo Oge said yes, they could provide detailed information.

Beverly Hartsock said she was finding the mobile source discussions to be very beneficial. She asked whether they could postpone the Acid Rain presentations and allow all of Margo's people to present that day.

The Subcommittee unanimously agreed to continue the Mobile Source discussions. The plan would be discussed over lunch and finalized early this afternoon.

Margo Oge said she would have to leave at noon, but hopefully Ms. MacGregor's people would remain.

Gay MacGregor said they could stay.

Beverly Hartsock asked them to look at some of the State programs currently operational to reduce mobile source emissions. Texas had a "smoking car" policy where motorists could report a car, and the State would send a letter to the owner asking them to repair the problem. It worked well. Many people repaired the problems and then reported back to TNRCC about what corrective action was taken.

George Bluhm (NRCS/U.S. Department of Agriculture) noted that farm machinery did last a long time because it was not used very much; different machines were used to plant, cultivate, and harvest. The machinery was not used daily, and was not run 24-hours daily.

Mel Zeldin (South Coast Air Quality Management District) noted that ICAO required a 15 percent NOx reduction for aircraft emissions and said he understood that the United States had refused to adopt these controls.

Bob Larson said the ICAO standards were proposed, and the United States did not go forward with the standards because they thought the cost-effectiveness assessments were not adequately analyzed. EPA recommended that ICAO establish a Work Group to further analyze the costs and benefits. He said that ICAO did not plan to implement the standard until the findings of the Work Group were finalized.

Bob Palzer said that one of the surrogates often used for PM was opacity. He asked whether there was any interest in using opacity as a measure of PM pollution from diesel engines.

Bob Larson said that the smoke program in use was looking at opacity-related issues. However, it was the smoke that was not visible that was harmful; much more so than the smoke that could be seen. OMS was looking at opacity.

Bob Palzer said if one looked at heavy duty diesels, certain aircraft, and locomotives, some of them were smoking excessively, and if they were running properly, they would not be smoking.

John Dunlap (CARB) said they had appreciated working with OMS in California. He referred to a key comment made earlier by John Seitz regarding SIP credits. Mr. Dunlap said OMS needed to do some stakeholder education and provide continued leadership. They needed clear signals from OMS, not mixed messages.

Fuels Program Primarily Targeted for PM and Ozone -- Lori Stuart (EPA OMS)

The fuels program consists primarily of:

Reformulated Gas (RFG) Program

Low Sulfur Diesel

Detergent Additives

Reformulated Gas Program

RFG was a year-round program that began in 1995 and was required in the 10 areas of the United	States with the worst ozone problems.

In addition, several States had voluntarily opted all or a portion of their ozone nonattainment areas into the	RFG program.

RFG currently used in 16 States and the District of Columbia.

Compared to conventional gasoline, RFG had lower levels of certain compounds that contributed	to air pollution and had higher level of oxygenates.

Phase 1 RFG: 15% VOC reduction, 15% toxics reduction, no NOx increase

1995-1999: 2.0 wt % oxygen, maximum 1% benzene

Phase 2 RFG: begins in Year 2000

Air Quality Benefits of RFG:

New monitoring data from the 1995 EPA Air Quality Trends Report showed that toxics	and VOCs declined significantly.

Significant progress was made in RFG areas:

Benzene was reduced by 43%

NMOCs were reduced by 28%

Analysis of actual fuel quality in 1995 also showed that emissions reduction targets were	being met or exceeded.

RFG Opt-In:

States had the flexibility to "opt-in" their ozone nonattainment areas into the RFG program.

When an area opted-in to RFG, EPA had to establish the start date through a rulemaking.

Phoenix was the first new area to request RFG since the start of the program in 1995.

EPA recently proposed a rulemaking to allow former nonattainment areas to opt-in to RFG (this	would be open to approximately 30 new areas).

RFG Opt-Out:

Under the current opt-out procedures (in effect through 12/31/97), opt-outs were effective	90 days after a Governor's petition was approved or if applicable, after a SIP was	revised.

EPA recently proposed changes to the opt-out procedures to ensure a smooth transition to	Phase 2 RFG.

States that chose to opt-out prior to RFG Phase 2 should submit request by December	1997.

States remaining in RFG Phase 2 stay in program through 2003.

Fuel Volatility Program

The volatility of gasoline, measured by its Reid Vapor Pressure (RVP), influenced the amount of	evaporative emissions that contributed to ground-level ozone.

As of 1992, the Federal requirement for RVP was 9.0 psi nationwide except for a lower requirement	of 7.8 psi in "southern" ozone nonattainment areas.

RVP requirements only apply during the ozone season (June 1 through September 15).

States may also adopt lover RVP levels through a State fuels program waiver.

Low-sulfur Diesel

EPA established standards in 1990 that went into effect in 1993 regulating the sulfur content of on- highway	diesel.

Sulfur content was not to exceed 500 ppm with a minimum cetane index of 40.

Standards reduced particulate and provided slight fuel economy.

Detergents

The CAA required all fuel sold in the United States beginning in January 1995 to contain detergent	additives.

The additives would control the formation of port fuel injector deposits (PFID) and intake valve	deposits (IVD).

Significant reductions were expected with 100 percent use of detergents.

Alan Krupnick asked whether OMS was studying the effects of MTBE. For example, were fuel pumps failing more rapidly, etc.

Lori Stuart said that they could spend a day discussing oxygenate issues. There was a report coming out next month that would show that EPA had not seen any negative effects on vehicle performance. The health effects were not conclusive at this time. Basically, OMS needed to do more research on these issues. The initial conclusions from the National Academy of Sciences were that the health effects from MTBE gasoline were not substantially different from base-level gasoline, especially with respect to acute health effects, so EPA did not believe there was reason for concern. In terms of water quality, the U.S. Geological Survey was doing some monitoring, but the results were not conclusive at this time. Santa Monica was a unique situation, because the leak there has been occurring for a considerable time. Ms. Stuart would recommend reading the STE report.

Steve Gerritson said that as part of the work for OTAG, they reviewed some research done by oil companies on proprietary fuel additives, and found that these detergents and other additives had the serendipitous effect of reducing NOx at far greater rates than were ever anticipated, at a fraction of the cost. He asked whether EPA had reviewed any of this research.

Lori Stuart said she had not seen this information, but EPA personnel in Ann Arbor had looked at it. She would have to request additional information from them and asked who conducted the study.

Steve Gerritson replied that Shell did the initial study.

Richard Phelps (Eastman Kodak) said what he had read and seen showed the need to have incentives for oxygenation. EPA needs to be proactive in this area.

Lori Stuart said that EPA would like to see some more testing before moving forward with any national recommendations. EPA was not strongly encouraging other oxygenates at this time.

Alan Shaeffer (American Trucking Association) said that low sulfur fuel currently applied only to on-road vehicles and wondered whether EPA had looked at expanding it to off-road vehicles.

Lori Stuart said perhaps in the future, but right now it was premature since they did not know the details of the offroad standards. It was on the "want" list of potential fuels control.

John Elston said fuels probably have the most effect on ozone of any control measure they had seen. The Subcommittee needed to look at the successes of this program. For example, when RVP was introduced, they saw marked decreases in ozone concentrations. Also, when RFG was introduced in 1995, they saw reductions in benzene concentrations at PAMS sites. Thus, they had an instant tracer in the atmosphere. However, with this tracer came a warning. Gasoline was the most prolific chemical in urban environments. Mr. Elston said they should be very careful of the modifications to such an important chemical. He thought Alan Krupnick's comments on MTBE were a good example here of what he was discussing. They needed to make certain that they were not adding things to the environment through gasoline that would adversely affect the public.

Lori Stuart said that the fuel additive registration procedure was very stringent, and did allow testing of any new additive that was significantly different from an existing additive.

John Elston said that some medical people would go as far as asking for something equivalent to an FDA-type process for drug approval to be applied to the approval of fuel additives. He asked if they had the medical people in EPA to evaluate these standards.

Lori Stuart said no, but they did have the risk and health effects people.

Jim Shrouds said he agreed with Mr. Elston's comments. EPA did need to be careful with new fuel effects. FHWA did see fuel changes as a very effective way to reduce emissions as opposed to transportation control measures. He asked whether Phase 2 RFG reductions were in addition to Phase 1 reductions.

Lori Stuart said no, those were the overall reductions.

Jim Shrouds asked whether these data were currently included in the MOBILE model.

Lori Stuart said yes.

Jim Shrouds asked whether the rulemaking for formal nonattainment areas applied to other areas as well.

Lori Stuart said sort of, since other areas can opt-in for RFG.

Beverly Hartsock said that in evaluating time lines for SIP processing from a planning perspective, they needed to be careful how all the different time lines interacted. The States could find themselves in very uncomfortable timing situations. Ms. Hartsock wondered whether EPA had considered allowing opt-ins for attainment areas. She also asked how they were looking at setting up RFG requirements for the new ozone standard.

Lori Stuart said that OGC had pretty much ruled out attainment area opt-in for RFG because of the way the CAA was written. So they were looking at the preemptive sections of the fuels policy to allow States to adopt a program comparable to the Federal program. On the NAAQS, Ms. Stuart said she did not want to get into that issue today. The subgroup was working on ozone at this time. She said they did see some legal problems, because the CAA was tied directly to the old one-hour standard. They were having a difficult time working with OGC on this.

Alan Krupnick said he thought that with the new standard, Subpart 2 of Title 1 would disappear. He asked Ms. Stuart whether she was saying OGC did not agree with this interpretation.

Lori Stuart said that was what they were hearing from OGC.

Alan Krupnick said this news was very troubling to the Subcommittee.

Gay MacGregor said the opt-in problem was specific to reform and not generic to the Act.

John Seitz said that would be his interpretation as well.

Lori Stuart said they were continuing to address this issue with OGC.

John Seitz said that they clearly wanted this group to consider looking at the issue. OTAG also had looked extensively at it as well. Thus, it had been pushed from many different directions.

Beverly Hartsock said that if EPA did not allow opt-ins, they were going to have a real patch-work quilt of control strategies.

John Seitz said that as they looked at control strategies, he would encourage them to look at options outside of the Federal mandate on control strategies.

Bill Becker said he knew that this discussion was focused on nonattainment areas and RFG. However, he wondered whether the OGC ruling also applied to extreme and severe areas continuing to implement their mandatory controls.

Lori Stuart said no, simply that new areas would not be entering the program. OGC really had not analyzed the issue relative to the new NAAQS. OGC would have to make the call.

Dennis Lawler (Illinois EPA) asked whether Ms. Stuart wanted to say anything about the sulfur program and drivability.

Lori Stuart said they were looking to get more data on low-emitting vehicles. It was on the list of "untouched"' areas, but they needed more data to determine whether it was a problem.

***LUNCH****

William Hamilton said they would continue on with the Mobile Source presentation for approximately the next hour. They would do their best to leave by 4:30 pm; but it might require pushing the SIP RFP issue back until tomorrow. Mr. Hamilton suggested that perhaps they could shorten some of the Work Group updates and still get out on time.

Gay MacGregor continued with her mobile source presentation.

Activity-based Strategies

Transportation

Reduce growth in VMT

Reduce trips

Other mobile source activity:

Non-road

Refueling

Cold start emissions, which were a big part of emissions, so reductions in VMT growth	were not the end-all solution.

Integrated strategy to reduce VMT growth:

Track 1: Merging Air Quality/Transportation/Land Use Planning

Conformity reinvented

Air quality/transportation planning processes merged

Development of analytical tools

TMIP/TRANNSIMs - a collaborative effort with DOT/DOE/EPA was fully coordinated	Other complementary modeling efforts were coordinated

ISTEA was reauthorized incorporating environmental concerns

Urban Initiative

Track 2: Transportation Alternatives Are in Place and Used

Travel Smart Initiative (OMS/FHWA public education collaboration)

Intelligent Transportation Systems (ITS)Support (OMS/OPPE/DOE/DOT collaboration)

Technical assistance for transportation control measures (TCMs)

Quantification of voluntary programs

Track 3: Market Incentives Program

Market Incentives Data Base

Market incentives guidance

Incorporate market measures across OMS programs

Transportation Conformity -- Kathryn Sargeant (EPA OMS)

Addresses conformity to the purpose of the SIP

No new violations

No worsening of existing violations

No delay in timely attainment

Transportation vs. general

Transportation conformity applies to Federal highway and transit actions

General conformity applies also all other Federal actions including airports and railroads

Conformity to the specifics of the SIP

Funding for transportation control measures

Adherence to emissions budgets

Emissions budgets

SIPs: allocate emissions reductions among highway and non-highway sources and create an	"emissions budget" for highway sources

Conformity enforces the SIP budget as a ceiling

Transportation conformity acts as enforcer to keep State/local transportation planning consistent	with State/local air quality planning.

Conformity: what actions?

Transportation plans (20 year timeframe)

TIPs (3-5 year timeframe)

Federal projects, including: those which

Receive ISTEA funding

Require FHWA/FTA approval

Regionally significant State projects partially affected

Conformity: who is responsible?

U.S. Department of Transportation

Metropolitan Planning Organizations (MPOs)

Interagency consultation -- each State must establish procedures for consultation among:

MPOs

State and local air agencies

State and local transportation agencies

EPA

FHWA/FTA

Conformity tests

Transportation plans and TIPs

Regional emissions analysis

Emissions budgets test

Emissions reduction tests (e.g, build/no-build test)

Transportation control measures on schedule set by SIP

Projects

Hot-spot analysis (local impacts) in CO and PM-10 areas

What happens if conformity tests are not met?

No new plans, TIPs or projects until the plan and TIP changed

Conformity rule

Original rule published in/1993

Flexibility and streamlining amendments would be final this summer

States must submit conformity SIPs

Conformity Assessment Project

Harvard study of conformity process

Would evaluate conformity after final amendment

Report due after 2000

Conformity and the new NAAQS

As proposed in the IIP, no short-term impacts

Conformity would not apply until new SIPs approved by EPA

Conformity would continue as usual in existing areas until then

Longer-term issues being discussed in the conformity subgroup of the NRSWG

Conformity subgroup issues

Where would conformity apply?

Who would decide?

Implementation issues if conformity applied to large areas

Should conformity apply before SIPs are approved?

Joe Minott (Clean Air Council) asked whether they were looking into how to include public participation.

Kathryn Sargeant said it was not one of the issues included in the paper at this time. It could surface as an implementation issue later on. OMS was certainly interested in public participation.

Beverly Hartsock said that when she saw the membership of the conformity subgroup, she questioned whether they had the right people at the table doing the talking.

Kathryn Sargeant said that conformity had a very broad cross-section of stakeholder involvement in the past. However, if there were issues regarding adequate representation, then they should discuss them. As for the conformity subgroup, they were open to additions.

Gay MacGregor said they definitely could benefit from the participation of people from different sectors, especially the utility industry. She would welcome more diversity on the conformity subgroup.

Beverly Hartsock said she thought public planners would be interested in this group.

John Elston said that this was a distinct policy question not unlike New Source Review; it was prevention of emissions growth. The process by which they went forward with conformity would lead to great complexity in transportation planning. There should be a way to bridge the gap using the track record of stationary sources. Mr. Elston thought they would do themselves a service by attempting to merge these groups.

Alan Krupnick said it sounded like Mr. Elston had something in mind and asked him to share it with them.

John Elston said it was important to link stationary sources and mobile sources and get these two groups talking with each other. He wondered whether they could do that with the persons already at the table.

William Hamilton mentioned a new member from a New York MPO.

Mike Silverstein said if EPA would do all it could to influence FHWA to put PM on an equal footing with CO and ozone, then he thought they could make some progress.

Alan Krupnick asked whether it was an administrative issue.

Jim Shrouds said Congress was working on this. They had administratively extended the ISTEA program to PM. The legislative goal that they currently had did have PM on equal footing with the other pollutants.

Gay MacGregor said EPA would be coming out with guidance in the future for calculating SIP credits for TCMs. They were in the process of surveying all available programs and evaluating this information. EPA would be working, most likely with California, in the near future to determine a process for calculating SIP credits.

David Baron asked why they had to wait until 2000 to evaluate whether conformity was in fact working instead of doing the analysis now. It did not require a 3-year process to determine whether conformity was working. Thus, he would encourage EPA to do this type of analysis now.

Gay MacGregor said that EPA already had Harvard under contract to collect the baseline information. EPA had three sets of amendments underway simultaneously. The report was due in October, and the 2000 deadline allowed for an evaluation of these amendments. They were not waiting; the work had been underway since last fall.

David Baron they would benefit from an evaluation now of how this program was working.

Gay MacGregor said they were trying to do this evaluation now through the effort that Harvard was currently undertaking. This information should be available this fall from the 16 or so cities that were currently being reviewed by conformity surveys.

Kathryn Sargeant said that the Harvard study was interviewing a broad, diverse group of individuals.

Jim Shrouds said there were 14 case studies for different States released in that report. The strength of this report was that they tried to reach consensus among the different States involved. Conformity did force the integration of transportation and air quality planning processes. It also forced an improvement in all of the models being used. On the negative side, everyone thought that conformity was overly complex; so much so that it could not be adequately explained to political leaders. The models simply were too imprecise to deal with the level of detail that conformity was asking them to address. There was an executive summary from this National Governor's Association (NGA) report that could be made available.

Beverly Hartsock said DOE/DOT worked on traffic and emissions models and asked when they would see some results on these efforts. Also, as they were looking at activity-based approaches, she asked that they please work at education procedures, especially with respect to dealing with airports.

Gay MacGregor said that airports were a very interesting area. There were numerous things one could do at airports to reduce emissions, such as the tugs that carry planes to and from gates. Ms. MacGregor said one could drive a car round-trip to the moon three times for the amount of emissions that come from one of these tugs. So, EPA was interested in working on airports and was in the process of gathering these types of information. They needed to research who did what and determine whether this information was reliable. Secondly, on the travel model improvement program, EPA's role had been to contribute money to get emissions modules incorporated in the model. The TRANNSIMs model would not be available for approximately 10 years; however, there were other shorter-term examples currently underway.

Jim Shrouds said that TRANNSIMs was a 5-year timeframe; but in any case, would not be available for SIPs. There could be some shorter-term products available, but again probably not in time for SIPs.

Gay MacGregor said they were redoing the MOBILE model. They were trying to account for conformity and other issues in these revisions (e.g., ramp metering). They were looking at the pros and cons of each of these processes. MOBILE should be updated by Summer 1998.

Beverly Hartsock said that anything that would allow States to get to these new tools as soon as possible would be greatly appreciated. These emissions were huge parts of most metropolitan emissions inventory.

Steve Gerritson raised the issue of land use linkages with the transportation system. He was concerned about the growth in VMT. While agreeing that there were good reasons for the growth of the 1970s; Mr. Gerritson said there were justifiable explanations for the continued growth, not the least of which was urban sprawl. He noted that mass transit systems were under-utilized. Metropolitan areas often had a much higher mobile percentage than the national averages, which could not be ignored. Creative thinking was really a must here. Mr. Gerritson would recommend that Bob Wyman's group look at these issues. EPA should fund some behavioral research as a means of reducing some of these emissions. If they did not get a handle on the long-term issues, all of the short-term solutions would be lost in the shuffle.

Gay MacGregor said she would agree that they had just begun to look at some of these issues through Bob Larson's group and because of the fact that Mary Nichols was very interested in these issues. They needed to look at why people made the travel choices that they made. They also needed to address what viable alternatives were available. Urban sprawl was not conducive to walking and other forms of alternative transportation. Ms. MacGregor said they had begun with California to look at land use models, and how they did or did not link to the other models EPA wanted to use. EPA also was looking at how land use changes related to air quality changes. When one said to the public that they needed denser population development, people did not perceive this as a positive alternative. So they were trying to educate the public on how to develop neighborhoods to better address some of these issues. They were just beginning this process. EPA used to have a land use office, but it got axed about 10 years ago.

Bill Becker said he was prompted by Jim Shrouds comments on the NGA report. He thought of conformity along the lines of a physical examination. If he was not feeling well, he went to the doctor and asked the doctor to tell him how to get better. On the other hand, he went annually to get a physical, even when he was feeling fine. The doctor told him what he hoped to hear, that he was fine and did not need to change anything. Thus, Mr. Becker had paid a price to determine that everything was working properly. They needed to do a better job of explaining conformity and exactly what it was.

David Hawkins wanted to follow-up on Steve Gerritson's comment. He encouraged EPA to explore ways of educating the public about the long-term implications of their choices. In 1974, working with the Washington Council of Governments, they noticed that the models were insensitive to some of the goals they were interested in researching. They asked EPA to analyze a different approach, taking only the new housing starts and comparing them to different transit scenarios from energy conserving to energy wasted. They found that in the end, it did not really make a difference in model outcomes. Mr. Hawkins did not know if these types of studies were ongoing today, but he thought they might need to be actively pursued.

David Baron wanted to echo Steve Gerritson's point on land use as a critical factor. He had some additions. He wanted to make the models more sensitive to the growth-inducing effects of transportation projects as David Hawkins's comment had highlighted. The models currently used just could not capture this. Secondly, Mr. Baron wanted to develop a model that more accurately captured urban sprawl in new road projects. He did not think that the NGA report necessarily reflected reality. Air quality information would be manipulated to fit the desired results of the project.

Bob Wyman wanted to reinforce David Hawkins' comments. His group referred to a CARB study that showed emissions reductions from good land use planning could be on the order of 5 to 15%, and on a local basis could be as high as 20%.

Joe Minott said that borrowing from Bill Becker's medical example, the tendency was to get fatter and fatter on new road projects, while the "physician" continued to say that it was healthy.

Bill Becker said he did not mean that conformity was not working everywhere. Just because conformity was not working in Philadelphia or Arizona did not mean that conformity was a failure.

Gay MacGregor said they were looking at land use models and had a work assignment underway to assess how these models captured air quality metrics. FHWA was working with EPA on this and other joint efforts. They hoped to get some demonstration projects going in 1998; however, this was not a short-term process. She wanted the Subcommittee to realize that this was not a one-year project.

Alan Krupnick said EPA's OPPE also had a fair amount of research going into land use planning. Resources for the Future was also involved there, so land use planning clearly was a hot research topic for EPA.

Gay MacGregor said they were working together in this area, and she could provide some information on the level of effort in this field.

Inspection and Maintenance/In-use Emission Detection Program -- Gay MacGregor

Basic I/M required in:

Marginal ozone areas with existing problems

Moderate ozone areas

CO areas with existing programs

Basic performance standard: approximately 6% reduction in VOCs

Example of a basic I/M program

Annual vehicle inspections using an idle test

Enhanced performance standard: approximately 32% reduction in VOCs

Example of an enhanced performance program

Biennial vehicle inspection with a loaded/idle test

On-board diagnostics (OBD)

Manufacturer installed on-board computer system capable of alerting drivers and mechanics	to vehicle emission control failures

Dash light illuminated if emissions increase >50% of emission standard, if any emission control part	fails

Evaporation system tested too

Fault identification helps repairs

Identifies problems

Verifies proper repair

Separate FACA Subcommittee evaluating OBD as a viable alternative technology

OBD required on automobiles and light-duty trucks beginning with model year 1996

Nine model years of vehicles equipped with OBD will represent significant portion of fleet in 2005

Key Considerations for Future Programs

Changing fleet technology

Monitors all emission control systems

Better detection of evaporative emissions

Increased vehicle durability

Evaluation data from existing I/M programs

Incentives to encourage maintenance

Ms. MacGregor said that I/M was designed to detect gross emission failures and to enact suitable procedures to fix these situations. She noted that there were consumer incentive programs available.

Alex Johnson asked where the pilot programs were operating.

Gay MacGregor said that San Francisco was one example of where a vehicle inspection program was in operation.

Control Technology Matrix -- Don Theiler (Wisconsin)

Purpose of the Matrix

To support the development of the integrated implementation and control strategies issue papers

To consolidate ozone and PM information into one table

To identify control opportunities and to show cross-cutting benefits of different control measures.

Sources of Data

OTAG

GCVTC

STAPPA/ALAPCO

Background documents and RIAs

Others including OMS, States (Texas), and European studies on ammonia emissions

How the Matrix was Organized

Source categories (used SCC classifications)

Source category emissions from the 1990 National Inventory

Control opportunities under each source category

Relative control efficiencies for primary PM-fine, SOx, NH3, NOx, and VOC

What the control efficiency symbols mean for benefits:

+++ -- >80%

++ -- >50%

+ -- 0 to 50%

X -- reductions are possible, but not quantified

Multiple pollutant benefits

Shading indicates reductions in both PM- and ozone-forming emissions.

At least a "+" in either NOx/VOC columns or primary PM/SOx/NH3 columns, and

at least an "X" in corresponding other set of columns

Columns are shaded in the matrix when multiple pollutant benefits are possible

Further work

Identify PM-2.5 versus PM-10 efficiencies

Identify Title II requirements (e.g., mobile source requirements)

Mr. Theiler said the matrix was intended for information purposes only, not for determining which technology should be implemented or preferred before another control measure. He asked the Subcommittee to please review the matrix and get comments in writing within 30 days to:

Bob Lopez

Bureau of Air Management (AM/7)

State of Wisconsin

P.O. Box 7921

Madison, WI 53707

(608) 267-5284

(608) 267 - 0560 (fax)

e-mail: lopezr@dnr.state.wi.us

Control technology matrix questions

(1) Was the qualitative approach for identifying cross-cutting benefits appropriate?

(2) Were there additional data sources that the Subcommittee wished to include?

Ben Henneke (CAAAC) wanted to know why energy conservation (e.g., fuel switching to natural gas) was not shaded in the matrix as a multiple pollutant control.

Don Theiler said that energy conservation measures did not have both +'s and X's, so were not shaded.

David Mobley (EPA OAQPS) said that they did recognize that fuel switching had multiple pollutant benefits, and they would go back and review it. It was not conclusive that this would apply to all energy conservation measures, but they could review them.

George Bluhm said he had one comment related to agriculture. Burning was a disease- and pest- control function. If they honestly wished to put an opportunity matrix together, they needed to provide a column for including multiple uses of technologies (e.g., burning). In agriculture, there were multiple resources; they needed to always look at the holistic approach to strategies and controls.

Susan Stark (ARCO Products) said she was thinking, in terms of using the 1990 inventory, that it might not be indicative of the rules and regulations that they had been discussing. First, if they were going to use 1990 data, she wondered why they would not include a projected inventory that would take into account some of the newer rules. Second, these emissions were based on uncontrolled sources and most industry did have controls. Thirdly, cost information would be very useful in this matrix.

John Seitz asked where they would go with this information. He said they could get into a debate over costs as OTAG did. If the purpose of this chart was merely to say where possibly they could locate reasonable opportunities to control across pollutants, then they did not need costs necessarily. If the purpose of the chart was only to identify opportunities, then Mr. Seitz thought they could do this now. He needed to know where they intended to go with this chart from here.

David Mobley said they simply wanted to identify the low-hanging fruits for multiple pollutant emissions reductions opportunities. They did not intend to get into costs here; in fact they were trying to avoid the detailed discussions of cost here. They did need to address control strategies, and they did need to address the level of cost effectiveness that should be considered here.

Susan Stark agreed about facility-specific cost estimates. If they wanted to keep this general, in terms of prioritizing for future research, she still thought they needed some indication of costs.

Carter Keithley (Hearth Products Association) said he would echo this. If the chart was an organizational tool, then they definitely needed to prioritize, whether in terms of cost or pollution reduction efficiency. Without some sort of organization, this document begged some questions.

Nader Mansour (Southern California Edison) said he also echoed these comments. He said that this document needed some organization before it could become a viable tool. He thought discussion of other effects of these control options need to be added to this table (e.g., high/low, greenhouse gas effects).

Molly Ross (U.S. Department of the Interior) said she worried about adding this kind of detail, because it begged the questions that they had glossed over. She believed this type of detail would be more misleading than useful at this time.

Alan Krupnick said he agreed with this approach. One was to say that the initiation of this effort was to simply look at what was out there and available, and they should leave it at that. A second option was to have each of the Subcommittee members take a look at this matrix, identify their low-hanging fruit, and see if they had some level of consensus. Mr. Krupnick did not want them to fill out this matrix in detail and fight over every issue.

Susan Stark asked how to define low-hanging fruit, if one did not consider cost effectiveness and emissions effectiveness.

Jean Vernet (U. S. Department of Energy) seconded Mr. Mansour's and Ms. Stark's comments - If something was still hanging around in 2003, it could not be low-hanging fruit, because it would already have been picked off the vine. They must add the control technologies that would be coming on the vine. Whatever EPA had in the baseline should not be available for harvesting.

Alan Krupnick said that was a good approach, that they not pick things that were already in EPA's baseline.

Beverly Hartsock said this chart was a control measure catalog; every State that had done a SIP had gone through this exercise. Thus, if one wanted to get into this work, she would suggest that they go to the 50 States and build on their knowledge. They had looked for low-hanging fruit for 20 years and could not find it anymore; the trees were getting taller. There were some categories (e.g., small businesses) that were not included in this matrix. They needed to do a thorough check here.

Don Theiler said he thought these were included under the "other point sources" category.

Alan Krupnick asked what the ultimate use of this information was. He wondered whether it was what technologies should be in an individual State's opportunity matrix.

Don Theiler said he did not think FACA needed to make these determinations for individual States. This might be useful for determining some national measures, but definitely not for individual SIPs.

John Seitz said this was his whole point. He thought this group needed to remain focused on regional to national control measures that needed to be implemented. Mr. Seitz asked what the matrix was for and what was their charge.

Don Theiler said they viewed this as a possibility for national and regional control technologies, not for use in individual state SIPs.

David Mobley said there was a lot of information out there. This document did not do a total integration. It simply took the individual data sources and put the information into a common source.

Alan Krupnick said he thought they should go with this for the time being, maybe wait for the control strategies discussion tomorrow, and then proceed.

Donna Lamb (U.S. Forest Service) said they had done a good job getting at the benefits of these control strategies; however, the disbenefits had not been adequately reviewed, especially with respect to integrated implementation.

Carter Keithley asked whether they were not now engaged in helping to devise guidance for State and local governments. If they were not, then he felt that they were somewhat paralyzed. For example, with the PM-10 issues, the States were not willing to take the initiative because they were afraid that EPA would not approve them. Thus, they had this circular paralysis. His objective was to develop some type of guidance document that would give some incentive to move forward.

John Seitz said he did not see anything in this document that would accomplish the goals Mr. Keithley was discussing.. He went back to what they were discussing; the group was there to look at a regional or national measure, and to determine what measures might be available to them to accomplish a certain goal. What Mr. Seitz was worried about was doing a cost analysis for an individual control technology, and delaying the whole process.

Carter Keithley said he was not suggesting that type of cost analysis.

John Seitz said he was in agreement with Mr. Keithley then.

Alan Krupnick said there was a placeholder for incentives, and this list could be a huge list. He was actually sorry they had this matrix.

Richard Dworek said he had found the table to be helpful. One could tell a lot from reviewing this table. When they tried to integrate and devise the overall solution, he thought this information would be valuable. When there was integration of pollutants, he thought some additional sources would be highlighted. Also, many sources had three +'s, but the industries had already installed technologies, and they simply could not get more bang for the buck.

Larry Feldcamp (Baker and Botts) said he agreed with Mr. Krupnick that this information was simply not worth it. If they wanted to get into more of this for guidance, then they should be doing it under control strategies in tomorrow's discussions.

Bob Palzer asked how, in using this matrix, one would deal with existing point sources that might tend to affect regional haze, ozone, and PM. He wondered how they would make hierarchical control decisions.

Don Theiler said this matrix was not intended for SIP development, merely for information purposes. It was designed to simply show inter-pollutant benefits and levels of specific technologies.

Vince Brisini said that without the 2007 inventory included, they really did not know anything. In terms of cost effectiveness, without some cost/ton or other cost measure, they really did not have anything. They needed to identify technologies that were already in place first. If he saw a value to this document, Mr. Brisini said it was as a tool in the control strategies discussion. Somebody needed to provide a menu of options related to the 2007 inventory.

Don Theiler said they had already discussed the 2007 inventory. When they redid the matrix, they would include the 2007 inventory; and this point was very well taken.

Georgia Callahan (Texaco) said that for PM in particular, if they used this in the longer term, they could do the cost analysis and select the measures that would do the best job. While some of these might pop up to the top, in the long run, they might not be the ones that did the job.

Charles Goodman (Southern Company) referred to low-hanging fruit. He said that the way they did this was the key. It was going to be important how they did it and they would all look to their neighbors to have the fruit that needed to be picked. They needed to look at the modeling and use good science to determine what would be picked and have the greatest impact on overall air quality.

David Hawkins said that David Mobley's comment was on point here; it was only an orientation document showing that there were techniques that crossed pollutant boundaries. They should simply leave it at that.

Mel Zeldin said he shared Mr. Hawkins's viewpoint. If the purpose of the document was to indicate that there were certain disbenefits/benefits with different measures, then the document was successful. He wanted to leave the document to its original intent. Mr. Zeldin wondered how critical the document was to achieving the purpose that Mr. Theiler outlined early in the presentation.

Don Theiler said he would leave this to Donna Lamb to answer, since she was the author.

Donna Lamb said they need some time for review before answering.

Mike Wright said that labor unions did not own the fruit trees, but they had a lot of jobs that depended on the fruit trees being there. So their anxiety levels were high throughout this whole process. When they considered costs, he thought that the key variable was not raw cost (e.g., $/ton), but rather its impact on employment. Employment was tied directly to public health, and a large negative impact on employment was in fact a large disbenefit to public health. He thought they needed to think about the strategies that would ensure public health. Losing one's jobs was a very real threat to people who wanted EPA to assure them that these regulations would not affect their employment status. Mr. Wright said he found this matrix very helpful. It was useful to show people that they were thinking about how to reduce these levels.

Molly Ross said it was not just employed workers who experience anxiety, it was a diverse socio- economic issue. Ultimately all States would have to deal with this issue.

Carter Keithley said that the potential danger of the chart could be that fireplaces were considered as a source of ozone. He did not think that this would pass the laugh test.

Don Theiler said that was part of what the matrix was for, to catch problems like that.

John Seitz said the dangers were real, and he would ask David Mobley to come back to them with a revision of this information.

Pre-SIP RFP -- Nina Dougherty (Sierra Club)

Progress During SIP Development (PDSD) was the replacement term for pre-SIP RFP.

Introduction

Pre-SIP RFP is reasonable further progress prior to SIP approval under the new/revised NAAQS.

Background

Strong concern was raised at the February 20 Subcommittee meeting during the RFP presentation	and RAMP/AOI overview.

Questions were raised about whether there should there be progress required during SIP development.

NRSWG received a strong signal that more time was needed to be spent on pre-SIP issue.

They decided to address it separately from SIP-phase RFP in a brainstorming session/joint work	group meeting.

Links to Other Papers: RFP, rewards and sanctions

Working Assumptions

Paper was neutral on whether current nonattainment was retained.

Did not address any changes to RFP status.

Covered all areas regardless of status.

Issues to be Discussed by Work Group

Issue 1: When should pre-SIP RFP begin?

New/revised NAAQS promulgation date

The date AOVs are established

Issue 2: Where should pre-SIP RFP apply?

Issue 3: What should constitute pre-SIP RFP?

Nothing additional (IIP, MACT, Acid Rain Program, etc.)

Avoid emission increases

Issue 4: What was the potential authority for pre-SIP RFP?

Section 165 - PSD Regulations

Issue 5: Should PM, regional haze and ozone be treated the same or differently?

Same to have consistency

States, Tribes, and Multi-states Sector

Full array of options from early % reduction to wait until SIP submittal

Support for national strategies

Public Health and Environmental Sector

Continue current required rates of progress

Expand IIP RFP

Early reduction after promulgation

National measures

State measures

Industry Sector

Needed planning first

Questioned legal authority

Current program sufficient

Early reduction after promulgation

Pre-SIP RFP Issue Paper Questions

Should there be required progress for some period of time between promulgation of the new/revised	NAAQS and approval of the SIPs?

When should areas begin?

Are the working assumptions, issues, and options complete?

Alan Krupnick asked whether these questions related to current areas that were in attainment.

Nina Dougherty said no, it might look this way, but it was actually covering the whole array, whether currently attainment or nonattainment.

Alan Krupnick said the IIP was covering areas that were currently attainment.

John Seitz said the IIP required current nonattainment areas to continue rate of progress determinations. The question would be how do they get early reductions in these areas.

David Hawkins wanted to review the bidding. He said that the environmental community had pointed out that one of the problems with the IIP was a provision that within the boundaries of the IIP was a condition that would not require additional reductions beyond the no backsliding issue. While they supported no backsliding, they thought that there were areas where additional reductions could be identified and pursued. They were told in the February meeting that this should be brought up under the RFP construct and that pre-SIP RFP was the appropriate place to address this. Now, they were being told that it was addressed in the IIP. Mr. Hawkins said that environmental groups thought that the IIP, as it addressed nonattainment areas, did not adequately go after early reductions in these areas as well as areas that were currently not in nonattainment. He wanted to know whether they got a considered evaluation of emissions reductions up front, and when they would get to evaluate it.

Beverly Hartsock said she interpreted the IIP differently. It was listed as a 3 percent reduction. Areas in attainment would be handled by the new NAAQS.

David Mobley said they tried to divide these issues into pre-SIP and post-SIP. The pre-SIP focus was on areas that were attainment, that would become nonattainment, and that was correct.

Vince Brisini asked about issues to be discussed by the subgroup. He wondered whether there should there be pre-SIP RFP and when it should begin. Some of these things could happen, but not necessarily as part of a pre-SIP RFP. He thought they should provide incentives for early reductions. In terms of national measures, Mr. Brisini wondered if they were really considered as pre-SIP RFP. He also did not understand how the IIP fit in; however, he would agree with Ms. Hartsock that it was included in the current plan. He asked whether ozone and PM should be looked at together and said yes, as long as their benefits were mutually inclusive; otherwise, they should not. He was concerned over this paper, and thought that it required some additional insight and review. The stakeholders needed to be a part of the buy-in.

Alan Krupnick asked what exactly was on the table at this point. He wondered if David Mobley adequately explained what was on the table. Attainment areas that were becoming nonattainment areas, as much as possible, incorporated areas that were nonattainment - was this what they were discussing?

David Mobley said yes.

Alan Krupnick asked whether everyone was happy with Mr. Mobley's explanation.

David Hawkins said he was not a part of the group, but he had no problems with Mr. Mobley's explanation.

Nina Dougherty said yes, she would agree with Mr. Mobley.

John Seitz told Mr. Brisini that he had answered every question but the first one.

Vince Brisini said that one of the problems he had was that they were talking about AOIs and AOVs but then started talking about something that took away the planning flexibility of the region. They were presupposing that there were in fact prescribed measures, and he did not think this had been established yet. Thus, personally, he did not accept pre-SIP RFP. Mr. Brisini did think there would be reductions, however.

John Seitz asked whether an area that had measured ozone violations had no obligations until designation.

Vince Brisini asked whether this was a modeled designation based on a 2007 inventory or was it based on measured violation. He said it really got to how you measured and defined those violations.

Sally Shaver said to the Work Group that she thought there was agreement at the Denver meeting that they should review measures that could lead to progress in this area. There was no discussion about a percent per year reduction, but was there a measure that they could come back to the Subcommittee with in this regard. She wondered if the Work Group was looking at this or providing a list.

Nina Dougherty said that the list was simply to point out an array of options at this time. It was not saying that this was something that everyone agreed on. It could be explored by the subgroup.

David Mobley said that this was one of the most contentious issues that the Work Group had addressed. They had not found any consensus whatsoever on these issues. They could provide the array for comment by this group.

Vince Brisini said he did not support pre-SIP RFP. If the issue was to be discussed, he thought there needed to be a review of mandatory reductions. There were clearly opportunities to get reductions, but maybe they would go after them in a different manner.

Steve Gerritson said he had some confusion on the purpose of the paper and the intent of the IIP. He was satisfied with Mr. Mobley's compromise. Mr. Gerritson liked planning processes, because they gave him job security. But they could be in the position of not seeing any significant reductions over several years, and this bothered him from a public health perspective. He thought they all shared his concern. There were several ways to reach fruit that one could not pick. One way was the way of elephants, which was to knock down the tree. The other was to use their brains and be innovative. There should be a planning component required to prevent them from following the same 3% per year technique that they currently had. Environmental measures could promote job growth, but by the same token they could be very costly.

John Seitz said there were nonattainment areas that would be nonattainment under the new standard. They must do the 3% reduction per year process under the IIP. The second two categories were different. First, for the new areas that were coming into nonattainment, Mr. Seitz questioned whether it was right to allow them to sit and do nothing. This second group also was segmented; they could be totally new, or they could be former nonattainment areas that were flipping back into nonattainment. In this case they should have maintenance plans to demonstrate their method back to attainment. So it seemed to be they should look at these areas and see whether they could learn something from the maintenance plan requirements. Mr. Seitz saw the totally new areas as the stumbling block. He did not know whether a blind 3% rule was the way to go, but he thought they must do something here and asked what made sense. They did not need to get into a legal debate over this, i.e., you bring your lawyer and I'll bring mine.

Alan Krupnick asked whether for PM-fines they had only had this last complex category with which to deal.

John Seitz said yes, that was correct. In Mel Zeldin's case, he knew that he was in, and wanted an early start on the monitoring with a fair start date.

Sarah Peirce Sandner said she passed this issue on to Ms. Dougherty, so she felt a little bit guilty. Assumption #1 was that the amount of time to implement the new measures was too long. The RAMP/AOI concept was driving this whole process. EPA had a new document that dealt with some of these time-related issues. They needed to understand the amount of time that would lapse between point A and point B. Obviously, there was a great deal of progress that was going to be made in this interim period, prior to their saying that not enough was going on in the interim period. The Work Groups were already challenged in terms of time, so she would suggest that EPA take on this responsibility. Secondly, she would like a clarification of the "potentially violates" terminology.

Sally Shaver responded that the RAMP/AOI process was not the driving force but rather statutory deadlines were driving the planning process.

Sarah Peirce Sandner said she agreed wholeheartedly with this perspective, but there were others who believed that the RAMP/AOI issue was delaying the implementation of this time frame.

Bill Becker said he wanted to focus his comment on the PM requirements of the pre-SIP process. He did not know whether 60,000 people were dying each year from particulates; he did not care whether it was 15,000 or 50,000. If SIPs were not developed for 6 years, then there would be some cross-section of the population that was needlessly dying as a result of their inaction. They could not in good conscience afford to sit here and do nothing. He did not have the answer. However, they should take advantage of some national measures that were proven to be the low-hanging fruit, and they should pursue them now. They could define progress in terms of control measures as well as in terms of accelerated data gathering, better monitoring, etc. To not take advantage of this interim period of time was simply being irresponsible. Mr. Becker would urge that they look carefully at ways of controlling and planning aggressively for these controls.

Alan Krupnick said he did not want to leave these big numbers hanging. The key study that EPA was leaning on for its PM studies showed that if a person was exposed to one fewer ug/m3 of fine particles per month over his or her lifetime, then that person's lifetime was extended by one month.

Bill Luneberg (GASP) said that some of the comments suggested that pre-SIP RFP was a kind of new concept. However, the paper suggested that the 1990 Amendments did set-up something similar to this. There was nothing to prevent a SIP from reflecting measures that had been adopted and partially implemented. Thus, there was a precedent and language within the Act to support it.

Richard Hayslip (Salt River Project) that if he reflected on the motivation for doing this, he would agree with Ms. Shaver. The discussion had been complicated by the use of the term RFP; RFP had a good deal of baggage that was implied in its name. Should there be incentives for early adoption, the way Mr. Brisini suggested, he thought this conversation would be much different. He would like to preserve the spirit of the discussions at the Denver meeting. Thus, he would suggest they recast this along the lines of incentives instead of RFP.

Charles Goodman said he did support the concepts of incentives and planning. If they were going to continue with this paper, they needed to discuss why this was too much time. His perception for areas that were new nonattainment areas was that it was going to take a good deal of time to implement these requirements. They needed to ensure buy-in at local levels. A good deal of buy-in was taking place, but they needed to ensue that it continued.

Beverly Hartsock asked whether these areas had to report progress prior to the SIP being turned in. She said a State could not get a SIP without doing the planning process. They had to have an inventory and an attainment demonstration. This was what had been the work of this early timeframe, thus they had to have progress. The progress could be local, or it might be part of larger national plans/programs. Ms. Hartsock thought the terminology could be a hang-up. Also, new areas that had never participated in a planning process were simply going to be swamped with all of the requirements. They must give these areas incentives toward early reductions; they simply must remove barriers to early incentives and early reductions. She did not believe that an area could not have progress prior to a SIP being developed; it was inherent in the SIP development process.

Tom Maslany said that SIP attainment demonstrations required that choices be made among many competing interests. It was a constant battle. RFP helped not only keep the desire to move ahead and the requirement to move ahead, but it also required that one did not have unconstrained growth. There was no instant solution; but during this process they would see progress. He would not call them low-hanging fruit, but there were options out there.

Greg Green (Oregon DEQ) said that in the interest of time, he wanted to third Steve Gerritson's and Bill Becker's comments. Anywhere they knew of problems, it would be irresponsible to wait and not move forward with reductions.

Mel Zeldin said that in California, they formed groups and started the planning process and began to move forward. Here, there were measures that could be identified and implemented in a reasonable period of time. This approach was definitely a possibility and progress could be made in that regard. Yesterday at the BPAP meeting, Jerry Golden presented a flow chart that showed how these types of measures could be utilized. This flow chart dealt with locations where local problems were in part associated with the nonattainment issue.

Susan Stark said she would echo what Ms. Hartsock said about progress in the interim. EPA indicated in its own announcement that numerous proposed nonattainment areas would come into attainment simply because of regulations that were currently on the books. She would also agree with Sarah Peirce Sandner's comment. On PM-2.5, they had very few data, and they had never done maintenance plans for this pollutant. The concept of accelerating plans for this pollutant could become problematic.

Larry Feldcamp said resources and planning were needed in existing nonattainment areas; most of the up-high fruit had already been picked. Thus, they were going to need some high-powered planning and analysis to make this project successful. They needed to have information on where they needed to go and how they were going to get there. These were very complex problems and they would not be solved overnight. They needed an incentives mechanism to encourage people to buy into this process. People would be willing to take steps to remove the nonattainment designation from their regions. They were talking very philosophically today and not about the heart of the technical issues. Mr. Feldcamp asked where they were going to go with this subgroup. He wanted to know whether they were going to handle this as a regular issue paper, or were they going to some modified streamlined process. The IIP was worked out in an ad hoc group for the coordination group. Mr. Feldcamp wondered whether they should even proceed and asked what EPA perceived as the direction.

David Mobley said they had deferred a decision on how to proceed until after this discussion. They would evaluate the results after today; they had hoped that this forum would solve all the issues, which obviously it did not.

David Hawkins raised the timing issue saying the point was made that RAMP/AOI was creating delays, and the point was made that this was not the case. He thought that this argument clearly missed the issue. Charles Goodman actually stated it: the statutory limit was the outside limit and could take up to 6 years to complete. The issue before this Subcommittee was whether the group was comfortable with taking 6 or more years to do preparatory work. Mr. Hawkins would advocate that EPA step forward and take actions necessary to get emissions reductions early in this lengthy planning processes. They needed to build in emissions reductions up-front. The first argument that had been made against this was that people were doing other things and did not have the time. Second, the argument had been made that they might not choose the optimum control strategy in this case. However, the cost of not choosing the optimum strategy must be weighed against the adverse health effects costs. The fact was, people would shut up until the science pointed in the direction of their fruit, then they would pop up and say that the science was not good enough.

Richard Phelps addressed Mr. Becker's and Mr. Hawkins's comments, as well as Ms. Hartsock's and Ms. Peirce Sandner's. They were not really looking at 6 years of no progress. The Section 112 law ensured progress. The pre-SIP process was not really being driven by science. In addition to the 112 suite of standards, there were a number of other regulations that were national in scope and dealt with ongoing emissions reductions. They also were looking at numerous other State and local controls. The CAM proposal was on top of all of these other rules. It seemed to Mr. Phelps that the sum of these regulations addressed RFP prior to the SIP development. Thus, he would say they were discussing an issue that needed to not be implemented.

Alan Krupnick said that in EPA's RIAs there were estimates of the progress that had been made (and would be made) from the Title I and Title II programs. There were additional reductions from the Title IV program. Perhaps they should ask EPA to make a presentation on these anticipated reductions.

John Seitz said that there were a lot of regulations either on the books or about to go on the books. EPA had a regulatory agenda that was currently out there. In conjunction with this, if an area appeared to be succeeding with these rules and was not affecting another area, then perhaps they should be satisfied with maintenance activities. However, if this was not the case, he did not see just sitting around doing nothing. Mr. Seitz asked what measures made sense to apply in these cases. For areas that were nonattainment and still had a good deal of progress to make, he thought this was problematic. Perhaps the Coordination Group needed to look at this in conjunction with Sally Shaver and make some recommendations back to the Subcommittee. He did have problems saying areas that were currently in nonattainment were not making any progress during the interim. These things were all pretty general; he thought they needed to put some specifics around the issues. There was room to make progress, and the question was the process by which they would achieve this progress. Perhaps they could do this as an Agency prior to the June meeting.

Dennis Lawler said everyone would agree with David Hawkins and Bill Becker that they were all responsible. However, it was back to the process, as John Seitz just suggested. He did not know whether it would take 6 years, but this process would take time. The whole process did take some amount of time, and they could not be ignorant about this.

Tom Godar (American Lung Association) said they had stayed away from the medical issues. They must act early. He had four decades of papers pertaining to excess mortality and morbidity from fine particulates, although not all of these studies were well documented and some did not use modern research techniques. When someone's health was affected as a child, an individual was created who would have health problems for his or her lifetime. Mr. Godar said that Alan Krupnick had minimized the importance of the number with respect to particulate mortality rates. Anytime they had excess deaths that were preventable, they had a problem. The ALA would like to go on record that they could not ignore these issues. Sure, ozone was better documented than PM. The ALA was angry about all of these issues, and there had been anecdotal evidence for decades. Sure, more research was needed, but they could not sit around and wait; they simply could not afford a delay. The problem was even more serious than the ALA had realized. What more research and data would prove was more deaths and more health-related problems. The health-related costs were astounding, and would far outweigh the costs of most of these control programs that they were debating here today. Mr. Godar would thus support Mr. Becker's comments in their entirety.

Molly Ross said it was hard to listen to these comments as a parent, and not be concerned about her children. There was good science to support the need for a secondary ozone standard. They might have to face the need to implement a secondary standard in the near future. There were a good number of problems being caused by these pollutants, and they could not afford to wait 6 years to resolve most of these issues.

Bill Becker said that was the direction he was heading. Larry Feldcamp challenged them to review the standards under the pre-SIP period. All of these comments were not that far apart. And perhaps Molly Ross was right, that they could reach some type of consensus here. Whether or not they agreed with each other on the numbers of deaths related to PM-fine, they might be able to find themselves agreeing on some basic set of measures that they could implement nationally. They needed to establish a set of things that could be done in the interim to show some real progress.

Alan Krupnick said that this was a good suggestion unless they had already tried it, and he thought David Mobley already indicated that he had tried it.

David Mobley said that they did try this brainstorming approach among NRSWG, BPAP, and STSWG, and out of this process, they did not make a good deal of progress. It was a very contentious issue, and there was no apparent consensus to be achieved among groups containing large numbers of individuals.

Nina Dougherty said that given certain direction from the Subcommittee, there could possibly be some agreement from which they could move forward. She would not classify this as consensus, but agreement.

David Hawkins said consensus was a criterion. The Phase I Report was a perfect example of this. They worked on these issues for over a year, and there was very little consensus in it at all.

John Seitz said that to the extent that the Coordination Group could formulate an ad hoc group as Bill Becker suggested, he thought this would useful . He thought there were a lot of semantics here, and no one said that they did not want to see progress made. This would be his recommendation.

David Mobley said they could contribute to that group.

John Seitz said they would let him know.

Chet Thompson (Collier, Shannon) said he did not want his silence to indicate agreement with the discussions of this afternoon. He had not read about pre-SIP RFP, but he thought it was about process. There was no question that industry wanted clean air; it was simply a question about how to get there. It was a process and they should follow it.

John Seitz said that most of the science had dealt with transport, etc.

Alan Krupnick said it depended on the costs/benefits of moving forward. They were not arguing the standards, but rather they were saying that, given the standards, how fast should they go.

Bruce Hill said it was safe to say that in some regions they did not need science to tell them that they needed interim measures. With respect to health effects and Tom Godar's speech, there were ancillary side effects, such as visibility in national parks that also must be considered.

Mike Wright said he supported the comments of David Hawkins, Tom Godar, and Bill Becker with regard to public health. The companies that had gotten themselves in trouble were the ones that did not make incremental progress in the environmental arena.

Susan Stark said they must capture in the charge to the coordination group that they wanted EPA to present the RIA analyses for economic projections.

John Seitz said they would present those measures that were related to attainments and their associated costs. They would not go through the RIA in great detail. There was a night session at the last meeting to discuss the RIA in detail.

Susan Stark said they needed to understand the costs associated with these different control measures.

John Seitz said that in reviewing the day, they needed to be thinking about regional and national measures in the context of an AOI. In his mind there was a need for strong national measures, whether they were mobile or stationary measures. There must be progress in the interim. He did not see people disagreeing with these basic measures. They needed to step back from the table and look at all of these issues.

Wednesday, April 9, 1997

William Hamilton opened the meeting. He announced that Sarah Peirce Sandner would give the SIP RFP presentation, and then they would proceed with where they left off the previous day. Mr. Hamilton also announced a Joint Meeting in Research Triangle Park on May 15-16 in which members of the BPAP and NRS Work Groups and representatives from STSWG would be asked to participate. Mr. Hamilton also announced the dates for the upcoming FACA Subcommittee meetings:

June 9-11, 1997 - Next FACA Meeting, Research Triangle Park

August 12-14, 1997 - Portland, Oregon

October 14-16, 1997 - No location set of as yet.

SIP RFP -- Sarah Peirce Sandner

Ms. Peirce Sandner began by saying that her presentation was only a status update; not a full-blown issue paper. Then she talked about the advantages and disadvantages to giving an update. The advantages were that it gave the Subcommittee some insight into the level of progress of the issue paper as it was developed and kept the paper from getting too far off target. The disadvantage was that it might present information that was very preliminary and fostered unproductive discussions. This was an experiment.

Objective of Update

Review progress to date on key Issue #1.

Should RFP process be standardized nationwide? Customized at the AOI/AOV level or a hybrid?

This was a work in progress; the Work Group had not completed its discussion.

No Work Group consensus was stated or implied

Process for Addressing Issue #1

Standardized RFP process in place ("ozone" RFP)

To evaluate the pros/cons of standardized versus customized process, a "model" customized process must	be assembled.

The Work Group had developed a "preliminary" customized model.

Key Characteristics of "Standardized" and "Customized"

Standardized

Single, standard RFP metric (emissions)

Standard quantity/rate (3% per year) and type (VOC with later NOx substitution)

Customized

Two metrics: air quality and emissions reduction

Not yet reviewed by Work Group:

Actual metrics for air quality and emissions reduction

Degree that these metrics could be customized on an airshed basis

Assumptions/Principles for the "Customized RFP" Process

The goal of the customized RFP process was to ensure measurable, periodic progress toward attaining the	NAAQS by the applicable date.

A subgroup might develop an alternative RFP process for instances where attainment by the attainment	date appeared unlikely.

The example process assumed that most SIPs would have multiple emission reduction programs,	some of which were implemented in a sequential (step-wise) fashion)

Initial RFP Flow Diagram (4/3/97 version)

Iterative RFP Process Diagram (4/3/97 version)

Ms. Peirce Sandner said her Group was looking to STSWG to provide guidance on the time interval(s) necessary to measure RFP milestones. The basic question that must be asked was whether air quality goals were met. They ha tried to make this a simultaneous metric test: were reductions in emissions achieved and was the desired air quality improvement attained. Thus, one had two metrics that must be met in order to get out of the box.

Ms. Peirce Sandner said that the things labeled "Next Steps" in the iterative RFP process flow diagram were important: continue implementation; conduct a reevaluation analysis; make mid- course corrections; take contingency measures; institute catch-up implementation; and/or incur sanctions/penalties. What this diagram did was describe a whole list of potential outcomes and processes. The air quality metric was added to ensure that emissions reductions were making the desired goals in air quality improvement.

RFP SIP Phase: Next Steps

Discussion of appropriate air quality and emission metrics, including any bounds to be placed on	these metrics in the customized process

Rate, base year, frequency of demonstration, relationship to regional haze and secondary NAAQS

Issues identified at the 2/97 FACA meeting

Issue Paper Questions:

1. Had the principles/assumptions described the intent of RFP for the new/revised standard?

2. Should RFP be standardized, or could it be customized?

3. Did these diagrams propose a reasonable process for RFP under the new/revised NAAQS?	Was the process robust enough to support a"customized" RFP?

4. Had the possible successes and failures of the emissions reduction goals and air quality goals been fully	described?

Alan Krupnick whether the "customized" process was similar to what existed now. The customized/standardized overhead was confusing to him.

David Baron raised a process question and wondered whether they were offering answers to these questions today, or were these just for further consideration down the line.

Sarah Peirce Sandner said it was entirely up to the time constraints of the agenda this morning. She cautioned everyone to remember that some of the information was preliminary.

Alan Krupnick said they had approximately 30-60 minutes to discuss this.

David Baron said he had a number of thoughts and concerns. He had a high level of concern and alarm about setting up processes for areas that were not unlikely to attain. A lot of areas would get put into this category and they would have set up a process that was doomed to failure. He also had grave concerns about a customized process. Many areas would defer emissions reductions to the very end, and by the time it became apparent that they would not attain, it would be too late. The process chart also bothered him. It looked as though the prerequisite for triggering contingency measures was determining the cause of a RFP failure. Finally, a methodology for determining whether the emission reductions had been achieved needed to be spelled out very clearly in EPA guidance or the SIP itself. These successes should be documented on a sector-by-sector basis. States needed to lay out exactly how the required emissions reductions were going to be met. In the past, this had led to failures.

David Hawkins said he agree with David Baron's comments. To set up such an option at the beginning begged inherent failure. The goal was to attain the standard, not to have a sufficient alternative if one did not meet attainment. The use of interim air quality goals as an additional metric would be influenced by the origin of those interim air quality goals. He was concerned that there might be a circular argument here. Were they not dependent on the levels of the emissions reductions? He asked whether one would set the air quality objectives and then determine the interim emissions reductions, or did one set the emissions reductions and then determine what the subsequent air quality changes should be. Mr. Hawkins said he did not know whether this had been discussed. Finally, it looked as though the table showed that the air quality metric was a one-way valve. A two-way valve system would provide incentives to set modest air quality goals, to allow for minimal emissions reductions. Thus, he would favor the one-way system.

Sarah Peirce Sandner said that in regard to the two-way valve on air quality, the process suggested that one had to reach both the air quality goal and emissions goal. This must be done simultaneously. She asked whether this met Mr. Hawkins's test

David Hawkins responded that the air quality metric had some value as a reality check on the efficacy of the emission reduction strategy. However, one could anticipate passing the air quality test and not necessarily achieving emissions goals. The one-way valve implied that one had to pass both the air quality and the emissions tests, and this pleased him.

Steve Gerritson commend the Group for the thinking that went into this paper. He wanted to support what they had proposed, with the understanding that he would agree with David Baron's comment about having to meet both tests: air quality and emissions. Often, emissions reductions by themselves were simply not enough: right reductions in the wrong locations; wrong reductions period. They really had to do both the emissions reductions and the air quality assessment. It was possible that targeted reductions would not yield the necessary air quality improvement goals. This might require a totally different approach to emissions reductions in order to meet desired air quality goals. His question would be whether they had the tools necessary to look at the changes in air quality, and he would defer this question to Harvey Jeffries and his STSWG. Mr. Gerritson knew that S.T. Rao had done some work on removing meteorology from air quality data, but he was not sure whether they could do this from year to year. He was pleased with this effort.

Dennis Lawler said his comment was echoing what Steve Gerritson just said. He had a fundamental problem with the use of air quality on equal footing with emissions. Mr. Lawler guessed they would wait to hear from Harvey Jeffries on this.

Sarah Peirce Sandner said the air quality metric would have to wait on STSWG's comments.

Vince Brisini said that what was built into this was, right now they used the ambient concentration as the metric to induce control measures, classifications, designations, etc. However, Herb Williams's paper had a plan for using areas that had approved plans. Mr. Brisini agreed that the metrics really needed to be there, but it was the consideration of the implementation of the actions that was important here. All measures would be reviewed and approved by EPA. Also, they had to recognize that they still had a basic disagreement between BPAP and NRSWG on when one actually developed the RIP. Somehow they needed to get these two groups together.

Mel Zeldin responded to Mr. Baron and Mr. Hawkins. He said he would share that sentiment if adequate time was given in the attainment date and classification process. For example, Southern California was an extreme ozone area, and under the current Act they had until 2010 to attain. Under the proposed changes, they would have to attain a more stringent standard by 2009. It was unclear whether without an extreme classification these things would still apply. Thus, there needed to be some provision made to recognize these issues.

Alan Krupnick said that first, on metrics, they were getting the problem turned on its head. David Hawkins suggested that they look at air quality improvement as an efficacy of emissions reductions. Perhaps this was backward. What they really wanted was air quality improvement. They were hesitant to recognize air quality as a metric because of the scientific difficulties associated with defining the metric. They should keep focused on the air quality metric as the prize, because that was what they were seeking. They should keep their eyes on the main prize. Mr. Krupnick also wanted to talk about "off-ramps". There was some precedent for the concept of an off-ramp; it had appeared in previous Federal regulations. Bob Wyman and even EPA had discussed a clean air fund that would function in a way that if one's costs of control were higher than some benchmark cost, one paid into the fund and not in controls. Then this fund could be used by the government to fund emissions reductions in other areas using other methodologies. This could be an off-ramp to prevent very costly control measures. It also would prevent the problem of not considering very expensive control measures, because one knew they would never be implemented. Mr. Krupnick said customization was good. The issue here was enforcement, not the design of the customized process. However, they would need appropriate enforcement in place. Mr. Krupnick raised the economic growth argument, which was not presented, but was in the paper. Areas with high economic growth would be treated differently than areas with low economic growth. He would argue against this and thought that it should not be addressed in the RFP issue. Economic vitality should not be an issue in the determination of RFP; economic issues should be outside the RFP discussion.

Larry Feldcamp said Texas supported the customized process. They saw a good deal of variability in the regions, and he thought the customized approach was good. The air quality metric needed to be looked at in detail. The overall use of an air quality metric was the attainment demonstration, which showed whether one was making progress toward the attainment goals. They also would be pursuing the off-ramp concept. They needed to determine the cut point at which one would say that there was nothing else one could do in terms of reducing pollution. There needed to be some criteria developed for when the 3% per year rule simply did not work.

Richard Phelps said he supported the work that had been done and had been amazed at the amount of effort that had gone into it. He wanted to address Mr. Hawkins's and Mr. Baron's concerns over unlikely attainment situations. Recent studies by Steve Ziman and David Chock had proven to him that they had real achievability problems for ozone, and possibly even worse problems for fine particulates. They needed to recognize that they ought to provide for customized and iterative processes and perhaps an extended time frame for some areas of the country. This was an iterative process, and iterative processes by nature required customized approaches.

Molly Ross wanted to react to factoring out meteorology. She said that some folks took the attitude that they ignored 1988 because it was an aberration. The meteorology appeared to be in a great deal of flux; it concerned her that one wanted to factor out the effects of meteorology in determining RFP. She agreed that growth should not be a factor in RFP. They did need to keep their eyes focused on the prize. When communities were growing, they should be required to keep air quality goals as their focus.

John Dunlap said that progress should be measured by a metric that could be controlled since they would be subject to Federal sanctions if they failed to attain. There were technical problems with alternative metrics. Population exposure was a retrospective technique that had inherent problems. RFP needed to be tied directly to real quantifiable reductions in emissions. He realized this was a tough nut to crack, but States supported real, quantifiable metrics that they could control, not something as variable as air quality goals. He also was not sure that economic viability should be excluded from the RFP discussion, especially in California.

Alan Krupnick wanted to be clear about economic growth. He said his suggestion really went directly to Mr. Dunlap's point. If an area was in economic decline, its emissions were inherently reduced and it would be making its goals.

John Dunlap said California was in a modest growth mode, and economic growth was always important. These credits looked good on paper, but they could severely limit growth.

Alan Krupnick said what they were talking about was economic growth outside of environmental regulations.

Bob Palzer supported a number of comments. He agreed with David Hawkins and David Baron. He did not think they were gaining much by looking at an area that was not going to meet the standards from the get go. He liked the analogy of the 1040 form. If one was allowed an out just because it was difficult to attain, then they would opt out. Mr. Palzer thought what they wanted was good air quality and a good economy. Sometimes one would had to use measures that were expensive in certain areas because of the severity of the problem. They were talking about public health issues here. The costs to public health were still there as long as they had air pollution. There was an environmental justice issue here as well; certain communities had high levels, and it was expensive to put on controls in these areas. The bottom line was that people lived in these areas, and they deserved protection.

Bruce Hill said that feasibility of attainment was basically a cost-effectiveness issue. It was not a pure science issue that STSWG could get its hands around. He asked who determined cost effectiveness, and at what levels controls were simply too expensive. There was an historical tendency to overestimate the costs of controls. He agreed that air quality was the prize. The ultimate goal was to protect air quality. Mr. Hill said he had more than ten years of ozone data from Mt. Washington, and was struggling to determine a trend; he thought it would be very difficult. Finally, he wanted EPA to respond to what the current Act allowed for making mid-course corrections. He agree that 15% blanket reductions did not work in most areas; and they did not want to step into such failures again. NOx for VOC exchanges, opt-out, and other approaches were useful, but Mr. Hill wanted EPA to address what was currently available.

John Seitz said that the Act could handle a lot of what was presented here in terms of getting reductions in nonattainment areas. The problem was areas outside of nonattainment areas, especially where they had overwhelming transport. The question they were looking at here was whether they could build a system that was more efficient. The argument could be made that the status quo dealt with this. The question was whether the status quo was acceptable and whether it was working.

Bruce Hill said it was important to know what was in the Act, and whether it was working properly.

John Seitz said legally he thought the Act provided for these processes. But Mary Nichols asked this group to build a program that not only used what was already in the system, but approached air quality from a more holistic approach, providing a better alternative system.

Beverly Hartsock said this paper was life as States knew it now. They were ultimately held accountable for meeting the attainment demonstration and emissions reductions. They were doing the very best that they could. They were evaluating these two things (emissions and air quality) currently to see if in fact they were making progress. This was also a very frustrating process. There were variables that were outside of regulatory control (e.g., meteorology). They needed to consider these things when evaluating effectiveness. Ms. Hartsock said she would like to ask STSWG pay attention to the metric for emissions reductions as well as air quality metrics. For emissions, they set base year, and they worked off of the inventories for years. They needed to try and find ways to reset base years and not have these processes hide good or bad problems. The air quality metric was more difficult, but they did need some help on emissions metrics.

David Hawkins said that on prioritizing metrics yes, they should keep their eyes on the air quality prize. However, they were discussing RFP, which implied an interim period on the way to attainment that in fact fell short of the prize. He wondered whether better than expected air quality improvements should provide a rationale for slacking-off on emission reductions. Mr. Hawkins did not think so. He was leery of interim indications that allowed for backing off from planned and adopted emissions reductions. He was not in favor of mindless emission reductions; they should be done in a intelligent manner. Emissions reductions should be accomplished with sound science, and they should not take 12 years of photochemical modeling to accomplish. They should not back-off on these commitments because they were making better than expected interim progress on the goals that they set.

STSWG Report -- Harvey Jeffries

Source Attribution Workshop

Two-day workshop in late July/August in RTP

First day devoted to methods for ozone

Second day devoted to PM

Peer-review panel (6 scientists) to review supporting documentation submitted by presenters and	others; prepare report to EPA/OAQPS and to STSWG.

Contractor identified and beginning organizational work

Contribution to RFP

Received three major questions from the RFP Issues Group:

(1) What was the appropriate interval for assessing RFP?

(2) What were the metrics available to do RFP?

(3) Were there tools that could be applied to remove meteorology?

STSWG provided strong support for air quality metrics combined with emissions metrics. It was unclear to Mr. Jeffries whether the tools currently existed to do these types of analyses. However, they would continue to work on this issue.

Contributions to the Institutional Mechanisms Paper

Technical responsibility of the RAMP

Technical work of the RAMP needed to take place on a "level playing field" of knowledge and	tools

Monies for data collection and further technical development should be made available to RAMP	members in the next 2 years

Models could not do everything by themselves!

Model Requirements/Emissions Inventories

"Use of Air Quality Modeling and Complementary Analyses to Support Air Quality Management	Approaches" - Ned Meyer's document

AOI Tools Paper

Ted Russell's paper - joint with NRSWG

Wildfire Discussion

Technical concern here on EPA's approach to model these things within Models-3

There were some smoke models that the Forest Service used, but there did not appear to be any precedent for running an eulerian 3-D model in a wildfire-type application. Emissions and transport were all issues that needed to be addressed. They had discussed coordinating with ORD, which was doing the Models-3 effort, and incorporating this wildfire information into the model. Mr. Jeffries would coordinate with ORD, and check to see if the emissions were being adequately assimilated into the model.

Donna Lamb referred to the Source Attribution Workshop, asking whether they looked visibility.

Harvey Jeffries said that this was an OAQPS activity to meet their own internal needs. They were in fact nervous about doing this peer review type process. He suggested that they identify a chairman and let it go from there. They simply were trying to extract information on the available techniques through this workshop. There was only time for about five presentations on ozone and five on PM. His judgement was if they could handle ozone and PM, then they could deal with the visibility. I had asked for help from the GCVTC personnel. However, it was the chairman's responsibility to fill the 10 presentation slots.

Mike Silverstein asked whether this would this be an open workshop.

Harvey Jeffries said yes, it would be in Research Triangle Park. The clients were OAQPS and STSWG members. They would make it available in this forum for discussion. Also, if one had something to contribute, he or she could submit written material to the peer review panel above and beyond the 10 oral presentations.

Communications and Outreach Work Group Update on Work Group Activities -- Tom Curran (EPA, OAQPS)

Air quality brochure

EPA product/Work Group review

Sent to printer that week

Copies by mid-May

"Plain English" issue paper summaries

Template reviewed and approved by Work Group

Ready to begin with Phase II issue papers

Contractor develops first draft

Designated Work Group contact coordinates with issue paper authors for review/comments

Distribution plans for the EPA Air Quality Brochure

EPA Regional Offices

EPA Libraries

OCLA

OCEPA

OAQPS

OAQPS Environmental Education Program

STAPPA/ALAPCO

Work Group members

Electronically on the TTN

Distribution plan for the Phase I Report

Subcommittee members

CAAAC members

STAPPA/ALAPCO

EPA Regions and Libraries

Electronic distribution on the TTN and FACA Web site

Plain English Issue Summaries

STAPPA/ALAPCO

EPA Regions

Subcommittee members

Work Groups

Insert to Brochure

Electronic distribution on the TTN and FACA Web site

Alan Krupnick asked about distribution of the report to Congress. They also discussed taking a delegation from the FACA Subcommittee over to Congress. It was pointed-out that they would first need to go to CAAAC, since they were a subcommittee of that committee. Sally Shaver would ask CAAAC for this approval tomorrow.

Susan Studlein asked about the issue paper summaries and wondered how they deal with the linkage among the papers that Joe Paisie discussed yesterday.

Ron White (American Lung Association) said that the issue paper summaries would be accompanied by a sheet, which was an introduction to the FACA process, and a list of all the issue papers. They would not have all the issue papers simultaneously.

Jim Shrouds supported Mr. Krupnick's comment about someone or some group briefing the staff up on the Hill. He thought it would be very helpful for Congress. On the outreach activities, he said he would assume that the two-page summaries would be via the Internet. Also, he noticed a number of groups missing from your distribution list (State DOTs, Metropolitan Planning Operations, etc.).

Tom Curran said that would not be a problem. They were printing sufficient copies of the brochure, and it certainly would not be a problem to do likewise for the two-page summaries.

Ron White said that they had targeted MPOs from the outset as their target audience. They could also make these available to State DOTs.

Chet Thompson said that the Small Business Administration should also be included on the distribution list.

Tom Curran said that they would add it.

David Hawkins asked how were going to characterize this report to Congress given the lack of consensus.

Alan Krupnick said they would take a delegation over there, and it was okay to display the lack of consensus. They want to let them know that they had been working very hard, that they generally had some principles, but that they had not reached consensus on a lot of issues.

Bill Becker said that he did not bring this up to get into any deep detailed discussion. They simply wanted to get to the Congress and inform them of what the Subcommittee was doing. He thought that it was appropriate to let them know even though they did have some differences. His intention would not be to go in and end up with a fight; they wanted Congress to be pleased and inspired by what the Subcommittee was doing here.

Tim O'Brien (Ford Motor Company) would like to hear whether others were concerned about a delegation visiting the Hill. This could turn this whole process into a very political issue by going to Capitol Hill. He thought it could cause some problems down the road.

Bill Becker said this was a good point. From the OTAG example, some members of Congress and their staffs heard of OTAG through the press, and were concerned that they were not informed about the process before reading it in the paper. He was trying to avoid repeating this mistake. They simply wanted to go to Congress and let them know what they did and did not represent.

Tim O'Brien said that they had all been to Capitol Hill, and things did not always turn out the way intended. However, the intent was pure and noble. He could see certain sectors rushing up to Congress in advance of the visit to lobby for their own interests. He agreed with the motivation, he simply wanted to point out his concern. Perhaps they were better off only sending the report.

Alan Krupnick said that EPA and DOT had been over to the Hill to brief Congress on specific programs so a lot of information had been transferred to Congress. They were not talking about a hearing. Perhaps they could just send a letter attached to the Phase I report.

Jim Shrouds referred to the issue of DOT's apportionment of funds on the basis of population. They were getting questions from Congress on how they intended to do this. There was a need to provide some input to Congress, and they needed to know where things were headed.

Vince Brisini said he thought it was very important to keep people informed about what was going on in any process. He was supportive of the Subcommittee process, but he had some concerns about going to Congress. In the heat of the debate over the standard, he wondered whether they could construe the Subcommittee as supporting of the form and level of the standard. He could see people working together on these issues, but he did not see everyone in this group agreeing on all issues. Any meeting with congressional staff needed to be represented properly, so that they came across as being intelligent.

Bill Luneburg said he would hope that if anyone went to Congress, it should be a single individual.

Tom Maslany he thought that for all the work that had gone into this, they should go to Capitol Hill and present the results. As for a congressional debate, he thought this could be handled productively. There were ways to express concerns and consensus without being contentious. Pennsylvania had done this effectively.

**** BREAK ****

Control Strategies - Dan Johnson (State of Washington, WESTAR) and Jean Vernet

Overview

Introduction

Mission Statement

Definitions

Principles

Working Assumptions

Key Issues

AOV leads to Control Regions which lead to Control Strategies.

Control Strategies Issue Paper Questions

(1) Was the mission statement for the issue paper correct?

(2) Any problems with the working assumptions?

(3) Were key questions properly scoped?

Mission Statement

This paper would recommend a process to be used by the responsible air quality planning authority for allocation of control responsibilities among national, prescribed, and discretionary required measures. This issue paper would also attempt to produce lists of suggested national measures and suggested prescribed measures that the FACA Subcommittee should consider and potentially recommend to EPA.

Definitions

For the purpose of this issue paper the control strategies subgroup would use the following standard terms to classify control requirements:

National measures

Prescribed measures

Discretionary measures

Mandatory reductions

Area(s) for control

It should be noted that, where appropriate, incentive-based programs might be used.

National Measures

Air quality improvement measures

Federally required nationwide

Applied without regard to air quality status of an area (e.g., Federal Motor Vehicle standards, NSPS, etc.)

Prescribed Measures

Air quality improvement measures

Federally required in a subnational area

Applied with regard to air quality status (e.g., stage II vapor controls, RFG, etc.)

Discretionary Measures

Federally enforceable air quality improvement measures

Selected by the air quality regulatory authority

Added to applicable national and prescribed measures in a plan to achieve air quality objectives

Mandatory Reductions

Total federally enforceable control program necessary in an area to achieve air quality objectives

Area(s) for Control

Area(s) within in which emission source(s) would share, appropriately, in the responsibility to achieve an	air quality objective (e.g., NAAQS, reasonable progress objective)

Principles

The issue paper would be prepared in accord with the content-related principles (2/20/97) adopted	by the FACA subcommittee.

Working Assumptions

Areas violating the revised ozone and/or particulate matter standard would be considered Areas of	Violation (AOVs) in advance of or perhaps in lieu of nonattainment areas.

Class I areas with impairment would be treated as AOVs.

In response to an AOV, states, tribes, or multi-jurisdictional organizations (whichever was appropriate)	would identify an Area(s) for Control.

With multi-jurisdictional Area(s) for Control, there would be an institutional mechanism that would	at a minimum, recommend to EPA the appropriate allocation of emission reduction responsibility	between States and tribes in a document called a Regionally Integrated Plan (RIP).

New source review requirements would be addressed in a separate issue paper

Integrated implementation - placeholder

Key Questions

Should there be additional national measures or changes to the mix of those measures? On what	basis would they be determined?

Science

Cost-effectiveness

Achievability

Public health

Equity

Input from the public

Other

Which measures should be adopted?

Should there be minimum requirements imposed as additional prescribed measures common to some	or all Area(s) for Control (e.g.,final AOI, preliminary AOI, AOV, other subnational domains,	other domains)?

On what basis would they be determined?

Science

Cost-effectiveness

Achievability

Public health

Equity

Input from the public

Other

Where should they be applied?

Which measures should be adopted?

How should the order of implementation be determined?

How should the situation be handled where national measures were not implemented or were not	timely?

What was the consequence to the regulatory agency (e.g., sanctions)?

For interstate, or State/Tribe Area(s) for Control, what if any guidelines should be used by the responsible	air quality planning authority in assessing the mix of controls? (e.g., with regional transport, should	the rules be different when large regional transport was the dominating factor?)

After answering each of the above questions, what implications were there for, or from, other issue papers?

Alan Krupnick asked why they had three questions here, and this whole list of more detailed questions, wondering how they should be proceed on these two sets of questions.

Dan Johnson said they wanted the Subcommittee to first evaluate the mission statement and let them know whether it was appropriate. If the mission statement was correct, they wanted to know whether the sum of the answers given to the six detailed questions answered the question posed in the mission statement? They would come back in June with the options.

Carter Keithley said the term "discretionary required measures" was an oxymoron. He suggested they reword this as "required measures used at the State's discretion".

Sarah Peirce Sandner was interested in where the mission statement went in terms of what the current CAAA required. The way this was headed, a possible outcome could be a process where section 182 (which would go away with the new standard) got rewritten. For PM-fine, they did not have an equal to Section 182; was the subgroup going to generate this? Also, Ms. Peirce Sandner was confused to how national measures fit into the FACA process without regard to air quality status. She wondered how they would judge cost effectiveness for these national programs. Obviously, visibility was something that would come-up in these discussions. So in the short-term, she asked how they would fit into air quality management.

Dan Johnson said yes, they would be addressing PM-fine. He was going at this a little bit out of the box and he was not ignoring the CAA. They had the opportunity to build a better mousetrap for handling today's air quality management issues. If they could do this under the current CAA, then more power to it. If not, they would make recommendations.

Sarah Peirce Sandner asked whether this paper would produce something that was above or below the current level of prescription. The second question dealt with national measures, irrespective of air quality status.

Dan Johnson said the group needed to discuss this.

Susan Stark referred to the opportunity, noting that yesterday the matrix had been deferred to this discussion. She wondered how it lined up with this mission statement and how Mr. Johnson's group planned to use the opportunity matrix.

Dan Johnson said it would be used when they got to presenting a matrix of measures to the Subcommittee.

Susan Stark asked if the issue paper would attempt to produce lists of measures whether this was where the opportunity matrix came in.

Dan Johnson said not necessarily; he was not telling David Mobley to continue working on the matrix.

Susan Stark asked whether they were postponing a decision at this time as to whether they needed the opportunity matrix.

Alan Krupnick said the first issue was how the allocation of control responsibilities was to be done across national and State governments. He wanted to urge the deferral of list generation until the appropriate level of governance was addressed. Any other way would be a fruitless exercise. They needed to look at these issues from the Federal, State, and local levels. Second, Mr. Krupnick wanted Sally Shaver and Jan Tierney to speak to the limits of EPA's authority in the CAA, specifically the required measures in subnational areas, which were not already prescribed in Titles I and II. They knew specifically what the bounds were if they thought inside the box. If they went outside the CAA, Mr. Krupnick wanted to know what changes were needed to give EPA authority to implement these measures.

Jan Tierney said she thought that the main issue was what authority EPA had to prescribe specific control measures. No one had come to OGC at this time. For OTC, they had explored this through SIP calls. They would continue to talk with Sally Shaver and her staff about this.

Alan Krupnick said that they needed more direction on this problem.

Sally Shaver said that clearly EPA had authority to issue certain national rules. The issue was whether they could tell specific States what control measures to implement.

Jan Tierney said that for the OTC SIP call on LEV, they had not fully analyzed this position.

Alan Krupnick asked whether EPA would lose its statutory authority to require I/M if under a new ozone standard, Subpart 2 lost its force.

Jan Tierney said that to the extent that it was not applicable under Subpart 2, and not covered under Subpart 1, it did present some problems for EPA under the new NAAQS.

Beverly Hartsock said that responsible air quality planning authority should be plural because it would require the involvement of at least three levels of government.

Steve Gerritson had two comments. To respond to Sarah Peirce Sandner's comments on national measures, the national measures would be decided on because of their impact on air quality, but required regardless of air quality status. A good example would be diesel engines; it makes much more sense to apply these controls at the factory, and not in individual States. Thus, this needed to be cleaned up a bit. Second, it was based on the assumption that there was more than way to achieve air quality improvements. The elements that went into the mix and the order that they were implemented were the determining factors in the process. It was going to be decided by a number of political jurisdictions and at a number of different levels. The debate would undoubtedly be acrimonious. The main point here was to set up some sort of objective or stand-alone process to bring some order to a rather chaotic process.

Ben Henneke said that the goal was to produce a document that would help them understand what all the choices were. He would suggest that they had a list of the sources or source types where one could assign emissions reduction responsibility. The other issue was who would make the appropriate reductions. These two issues did not have to be decided by the same entity. Using the diesel engine example was valid. One could assign the emissions reduction responsibility to the gasoline refiners. This was both a scientific and political issue. The reductions needed were site- specific, and there was a good deal of variability. Thus, local entities were best suited to write a coherent plan for their areas (e.g., States, local governments). If they chose to ignore the scientific and political differences that existed in today's world, the system would not function properly. They must tag someone to make the reductions and someone to pay for them. Otherwise, they would have an off-ramp process established to avoid the costs of the emission reductions. Control strategies should be divided among those politically able to provide the emissions reductions.

Alan Krupnick asked whether a trading program was viable here.

Ben Henneke said sure, but it was not the only way.

Mel Zeldin said he was confused. He said that if they went back to Paisie's diagram, there were a lot of arrows pointing into the control strategies box. They really could not come to any conclusions here until all of the arrows pointing into this box were resolved. Maybe a two-step process was required here, or a new framework.

Dan Johnson said that this was a good point, and he had thought about it.

Molly Ross said that the working assumptions were very simplified, and she did not want them to lose sight of complexities involved here. On Class I issues, areas with visibility impairment were important. The national visibility goal also precluded future visibility impairment. Similarly, on the horizon was the notion that EPA had committed to move forward with SIP revisions. She thought there was much work to be done here before it came to fruition. When they dealt with AOVs and AOIs, these same concepts would arise. This was a much more complicated process than what was outlined in Mr. Johnson's simplified working assumptions.

Richard Hayslip said a more general approach was needed. The working assumptions implied a certain softness; they need to focus on the framework here and not the specific measures. He thought this was consistent with what the Subcommittee was all about. Gay MacGregor pointed out in the Coordination Group how difficult it was to establish transportation policies because of the lack of data. So he thought they should deal with the framework.

Karl Schultz (DuPont) said that one way of doing this was to return to the definitions and see what was really meant by national measures. They should go back to the CAA and see what authority they had already in the law. When they discussed prescribed measures, they also needed to go back to the Act and see what was already included. The only changes required dealt with AOIs and whether the regulations were extended to them. The discretionary measures should be evaluated likewise. He thought this was a much better framework to analyze this issue.

Bill Luneburg said it might reduce some anxiety if they included the term "presumptive".

Alan Krupnick asked whether Mr. Luneburg was suggesting that there was another legal path in using CGS.

Bill Luneburg said that this sets the standard at what one should be doing unless it could show a better way to do it, or that it could not be done regardless of the control strategy.

David Baron wanted to shed a cautionary light on the discussion of Subpart 2. He did not believe that Subpart 2 went away if the standard was revised. On the mission statement, he was going to take issue with the suggestion that they should be general here because they did not have the technical ability. He was concerned about the suggestion that they develop a process. This appeared to him to not be very useful. Mr. Baron thought that EPA would like to see some specific measures on how to accomplish things. If they danced around this issue, they were not going to provide EPA the benefit of their diverse inputs. He thought they could come to some broad level of consensus on some of these issues. Karl Schultz suggested paint; cleaner diesel fuels would be another way. A CTG for Stage II Vapor Recovery would be another example. Mr. Baron thought there was no better place to look at these measures than in this process. He was concerned about Working Assumption #1 where areas that violated the revised ozone and PM standard would be considered AOVs in advance of or perhaps in lieu of nonattainment areas. They had not adopted the AOI/AOV approach, and he did not like them continuing to use this terminology.

John Elston said that this was going to be a difficult subject to frame. Mr. Krupnick's issue of governance was also very interesting. There were levels of control that were independent of the level of government. As long as they had strategies that could be applied without regard to air quality status, cost constraints would be a stumbling block. They were beginning to set the barriers for what they could and could not get into. They had to allow for preemption in certain areas, and LEV was a good example of this. The paint rule was another good example. There was a very strong cross-over between national programs and local and discretionary measures. He would encourage flexibility in these areas.

Richard Phelps was concerned about what was meant by impairment, whether they were they talking about specific measurable quantities (e.g., visibility), or were they talking about the much less well- defined air quality-related values (as presented in the NSR proposal). In this latter instance, these were subjective, non-quantifiable decisions that bothered him a great deal.

Molly Ross said there was a definition in the EPA rules for visibility impairment, and it was basically a perceptible impairment. She agreed that they had to have a process, and it needed to be defined clearly. It might always be considered to be subjective, but a Federal Land Manager had to do the best he or she could. These issues had been contentious, and they would continue to be so.

**** LUNCH ****

White Paper Discussion -- Lydia Wegman (EPA OAQPS)

White Paper Would Include:

Executive Summary

Short overview of first 25 years of CAA implementation

Guiding principles for implementation of revised ozone and new PM-fine standards based on principles	developed by FACA Subcommittee (regional haze was also included!)

Discussion of EPA's approach to implementation in 5 key areas

Questions and answers on specific issues of concern (e.g., I/M, conformity, RAMP/RIP process)

Five Key Areas

(1)	Identifying areas where controls were needed

(2)	Planning process

(3)	Control strategies and measures

(4)	New source review

(5)	Attainment timelines

Identifying Areas Where Controls Were Needed

Area of Violation (AOV): where air quality standard was exceeded

Area of Influence (AOI): larger areas that potentially contributed to violations in AOVs

In cases of transport, new approach would prevent burden of control requirements from falling exclusively	on sources located near violations

Looking at ways to provide incentives to help areas avoid becoming AOVs

Considering whether and how best to use classifications of areas based on severity and complexity	of air quality problem:

Provide public health information

Facilitate determination of control requirements

Planning Process

Need for cooperative planning of control strategies among all areas contributing to air quality problems

Use of regional planning bodies - RAMPs

Work together to define preliminary AOIs, develop emission inventories, conduct modeling,	engage in integrated planning activities

States within preliminary AOI would develop regionally integrated plan (RIP) and identify final AOIs

Based on RIP, States and Tribes would develop and implement SIPs and TIPs

EPA would do SIP/TIP call based on RIP

SIPs/TIPs would be expected to be in place by June 2003

Control Strategies

Aim to design control strategies to address ozone, PM-fine and regional haze in an integrated fashion

Need for flexibility in designing control strategies to address both regional and local air quality problems

Anticipate use of national, regional and local measures

National measures: mobile, stationary and area sources

Regional strategies: cap and trade programs for NOx and SOx, including declining emission	caps and trading at ratios different from one-to-one across regions; possible use of	clean air fund

Local strategies and measures

Expect increased use of economic incentives and voluntary measures

EPA and other Federal agencies would work to identify air quality benefits associated with	various transit options, including congestion mitigation strategies.

New Source Review

Two options under consideration; both would allow trading across AOIs to obtain offsets

Option 1

Designate only AOVs under Section 107 as nonattainment

New and modified sources within AOVs must get offsets

Reductions throughout the AOI would be used to achieve RFP, and attainment and to offset new growth	in AOVs

Aggregate growth from new and modified sources within AOVs must be offset by aggregate reductions	within AOVs, including reductions from all sources that exceed or otherwise required reductions.

Assume that total reductions from all AOVs within an AOI would be sufficient to offset new growth within	AOVs, and meet RFP and attainment needs.

LAER would apply in AOVs; BACT would apply in AOIs

Option 2

Designate entire AOI under Section 107 as nonattainment

New and modified sources within AOI must get offsets

Offsets could be obtained from anywhere within the AOI

LAER would apply to new and modified sources within an AOI

For Both Options

Cap and trade program could be used to obtain offsets

For sources subject to LAER, EPA wants to explore allowing sources to offset the difference in emissions	reductions between BACT and LAER

Alan Krupnick asked for clarification of New Source Review.

John Seitz said that for the purpose of offsets for NSR, the overall reductions had to come from within the AOV because of statutory limitations. The offsets required to meet the NSR offset requirements would come from the AOV. They were attempting to balance the overall emissions across the AOI.

Lydia Wegman offered a circle diagram prepared by Joe Paisie that she thought might help them understand. For RFP and attainment, one would need to get reductions.

Alan Krupnick asked whether it was sort of an accounting process and whether the emissions could be doing double duty.

Lydia Wegman said yes, they could.

Bob Wyman asked whether AOV 2 could buy up all of the credits of a city in AOV 1 that was undergoing a recession.

Lydia Wegman said yes, that was a possibility.

Bob Wyman said that by doing so, they would allow geographic shifting, which was not necessarily a bad thing. If one wanted to get offsets from manufacturer D and manufacturer B, one could not do this without getting substantial reductions in AOVs 1,2, and 3.

Lydia Wegman said that the theory was there would be an overall cap and trade program that would be guaranteeing reductions. The declining cap would take care of the reductions.

Bob Wyman said that one of the problems in Option 1 was when AOVs 1,2, and 3 had used up most of the lower cost reductions, it might be difficult to get the required reductions. He wondered if they had run any numbers yet.

Lydia Wegman said no, they had not run any numbers.

Bob Palzer said he was trying to understand how this was a declining cap.

Lydia Wegman said the planning cap would have to provide for that air quality improvement.

Bob Palzer noted that point was not currently in the paper.

Lydia Wegman said the paper did not require a declining cap; an area could determine another way to get the mandatory reductions. However, a declining cap was probably the easiest way to get those reductions.

Bob Palzer said they were doing this trading in the AOI regardless of the proximity of the AOV. In an area where there might be complex terrain, he asked how they would account for a one-ton reduction in one area versus a similar reduction in another area.

Lydia Wegman said that this issue came up in all types of trading, whether they were getting the right reductions in the right locations.

Bob Palzer asked whether this issue would this go to the STSWG for review.

Lydia Wegman said she did not know at this time. More likely the economic incentives group would review.

John Seitz said that with respect to NSR, they were leveling the playing field and creating an incentive for reductions. This was both a policy and a technical issue. They looked throughout the CAA to try and balance this issue and still be able to reach attainment. This was an accounting exercise. They were looking at an inventory management situation and applying the reductions across the board. Perhaps it might had been simpler with only one circle. It was an accounting exercise against the inventory.

Bill Luneburg said that after struggling for three days with very general papers, all of a sudden the Subcommittee had some very specific technical guidance. He thought NSR was still in the box, and wanted to know who the audience was for this particular document.

John Seitz said there was a question as to what was this starting to look like. At the time, he said EPA would put together what it was hearing currently; that was the intent of this paper. With respect to NSR, it was an issue that had been rather lively whether they were in the box or out of the box. What this group wanted to do to level the playing field was primarily a legal issue. They had worked with OGC to come up with options in the four corners of the CAA. They were now bringing this back to the Subcommittee for comment. They would be glad to hear comments at this time. They saw these as options for NSR within the four corners of the CAA. Clearly, this paper would come back to this group. At some time, EPA would had to take this information and move forward.

Lydia Wegman said that this paper did serve a combination of purposes.

Bob Luneburg said he had not heard enough consensus this week that one could come away from this discussion with any principles.

John Seitz said he was not presenting this as consensus, merely what they had learned thus far.

Vince Brisini said he had the same concerns. This was a representation of what EPA thought it had heard. He was not so sure that he had heard these same things. On NSR, they had some pretty lively debates on the whole idea of a budget and cap procedure. They discussed this as a possibility, but in no way did the NSR paper limit itself to two options. It was a great disservice to those who worked on this issue. The white paper came across as prescriptive: these were the two options, and these were the only ones on the table. Mr. Brisini wondered if this applied only to the ozone season. Also, he said there were discrepancies between the paper's options and the circle diagram, and this caused him some concern.

Lydia Wegman said that the AOI as a whole was supposed to be reducing emissions.

Vince Brisini said that the words in the paper did not support the circles on the diagram. He also shared Bob Palzer's lack of understanding about the declining cap. He did not see this anywhere in the paper. Where LAER showed up in the BPAP paper, it was NSPS rather than LAER.

John Seitz said they tried to construct some options that were within the CAA. They were absolutely not the only four options. However, they did fall within the statutory framework.

Vince Brisini said he wanted to avoid the understanding that was implied in this paper.

John Seitz said that was why nothing was being distributed in writing. They were here to get discussion.

Vince Brisini said that if EPA passed out the paper, then it would passing out the tablets.

John Seitz that was correct. This was his charge as director of OAQPS.

John Elston said they needed to understand the legislative framework. One legal opinion might simply not be enough. It was his experience as a member of the OTC, that they were wrestling with this very problem right now. Vermont was attainment for ozone, but must meet reductions and offsets. New Jersey on the other hand had been in nonattainment, and probably would be for a good time to come. Now they were starting to build in something that was even more complex than what they had today. They were getting ready to add a dual accounting system on top of the existing offset program. They had been doing these things to themselves for the past 15 years. They needed to step back and look at the legislative framework. Mr. Elston said that perhaps Bruce Carhart of OTC could engage in a dialog on how to arrive at a potential solution. They believed that if a good cap and trade program was in place (for NOx), it was an effective growth inhibitor. They needed to work toward simplification. The program must work over multiple jurisdictions. Whether this showed up in the RAMP or the RIP, it would stop progress immediately. This was a clear warning that they needed to stop and take a look at this.

John Seitz said he could not agree more. This was not making things simpler. They would welcome the lawyers presenting ideas, but to date, he had not seen any new, brilliant legal framework coming forward. The current structure that they were in simply did not achieve their goal of leveling the playing field.

John Elston said he was sure Bruce Carhart would agree to help here. If they did not do this thing right, the AOI and AOV concept would fail.

John Seitz said they were willing to do this, and perhaps the entire Subcommittee would like to hear this presentation.

David Baron said he agreed with John Elston. However, he was not sure that failure of the AOI and AOV concept would be such a bad thing. During the NSR discussions, it was suggested that these be treated as nonattainment areas. He asked whether that meant that AOVs would have all of the same responsibilities for planning as current nonattainment areas had.

John Seitz said yes, that was true; the AOV must show an attainment demonstration plan. They had to look at the AOI and the planning responsibility. The planning region in which the reductions would occur were obviously greater than the AOV, most likely within the AOI.

David Baron said he was concerned about the timeframe for all of this.

John Seitz said they would need to address this issue further.

David Baron said his major concern was about planning and the timeframe.

John Seitz said he could understand this.

Mel Zeldin asked whether the AOIs in options 1 and 2 would pertain to preliminary or final AOIs or whether it would make a difference.

Lydia Wegman said it would be the final AOIs.

Mel Zeldin said then when the AOV was finalized, they would have a time gap.

John Seitz this was an early crack at what was currently available within the CAA. If it did not work, then they would revisit this issue. They were simply trying to level the playing field, and this was their first attempt at doing this. They certainly did not hit a home run with this, but they needed to move beyond the NSR issue at this time.

Beverly Hartsock commented that all they had heard was negative. She thought there were possibly some positives here. Ms. Hartsock did not think that EPA should get a message that they all thought this was a failure. She thought they needed a chance to think this through and to then get back to EPA.

John Seitz said he did not take it as that.

Larry Feldcamp said he hoped they noted that recognition was given to some of the other options. He said he realized that they had looked at the CAA and done what they could. However, they had discussed looking outside the four corners of the CAA and making some recommendations. At some point he thought they needed to address these issues.

John Seitz said he agreed. They did need to explore additional options. It was not meant to be exclusive of those concerns.

Lydia Wegman said that she would be glad to look other options. She then proceeded with her presentation.

Attainment Timelines

Attainment deadlines provided essential incentive to ensure continuing air quality progress

Needed both ultimate attainment date and earlier dates linked to measurable increments of progress

For regional problems, States and Tribes participating in RIPs should agree on progress milestones	and include them in individual State/Tribe plans

EPA was exploring whether attainment demonstrations could rely in part on measures that provided	long-term air quality benefits, such as changes in transportation patterns, but had no associated	short-term emission reductions

Plan would need to include some significant near-term emission reductions measures

Also exploring allowing attainment demonstrations to be developed incrementally in anticipation	of future development of new cost-effective technologies; analogous to CAA provision for	extreme areas

Any plans relying on long-term strategies would need to provide for mid-cycle assessments of progress

Consequences would apply failures to complete phases of the planning process and match the importance	of specific activities.

Larry Feldcamp asked whether this approach was identical to what Sarah Peirce Sandner was presenting this morning.

Lydia Wegman said yes.

Acid Rain Program Overview -- Brian McLean (EPA)

Fundamentals of SO2 Allowance Program

Flexibility

Accountability

How Did They Define Flexibility?

Ability to do what one wanted when one wanted to do it to meet emissions reductions without government	interference

Flexibility Increased Options

Allowed multiple ways to comply

Trading was just one option

Credited early reductions

Accommodated early reductions

Accountability

Held sources accountable for their emissions, not the options they chose for compliance

Assigned responsibility for emissions

Had to be able to account for all emissions

Historic Regulation of Emissions

Traditional air pollution control requirements stated as technology requirements, emission rates,	concentrations, percent removal, not as allowable emissions

Early emissions trading programs

Existing Approaches to Emission Trading

Conversion to a tradable commodity (emissions) required for the determinations of present and	future utilization and emission rates

Goal of SO2 Allowance Program

To reduce SO by 10 million tons

SO2 Allowance program: A New Approach

Not built upon existing programs

Made allowable emissions (output) the implementation objective

Required measurement of emissions (output)

Capped total emissions to ensure maintenance

Simplified permitting (input)

Made penalties and offsets automatic

Established default limits to assure reductions and discourage delay

SO2 Allowance Program: Key Features

"Allowance" authorization to emit one ton of SO2

EPA allocated allowances to utilities based on desired performance rates and representative utilization	levels

Total allowance per year = half of 1980 SO2 emissions

Permits were simple and flexible

Utilities continuously monitored emissions

At the end of each year, utilities must hold enough allowances to cover emissions

Also, all utilities must comply with health-based State or Federal limits

The program affects some 800 power plants across the country.

SO2 Allowance Program: Benefits

Health: $12-40 billion per year by 2010

Visibility: $3.5 billion per year by 2010

Fewer acidic lakes and streams

Reduced damage to buildings and monuments

SO2 Allowance Program: Costs

In 1990, estimated to cost $4 billion per year by 2010

Observations

Permitting could be greatly simplified

Case by case review of trades was eliminated

Conclusions

Market based instruments were tools not ends

Flexibility must be matched with accountability

Mr. McLean said the program's Web site was at http://www.epa.gov/acidrain.

Bruce Hill asked when was the next NAPAP report due.

Brian McLean said that the 1996 report was due out this year.

Rani Godbole (Phelps Dodge) asked whether any of these sources were connected to other regional trading programs.