Federal Register, Volume 59 Issue 92 (Friday, May 13, 1994)

[Federal Register Volume 59, Number 92 (Friday, May 13, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-10974]

[[Page Unknown]]

[Federal Register: May 13, 1994]

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DEPARTMENT OF THE INTERIOR
40 CFR Part 63

[AD-FRL-4881-4]
RIN 2060-AD02

Federal Standards for Marine Tank Vessel Loading and Unloading
Operations and National Emission Standards for Hazardous Air Pollutants
for Marine Tank Vessel Loading and Unloading Operations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of proposed rulemaking and notice of public hearing.

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SUMMARY: Standards implementing two provisions of the Clean Air Act
(the Act) are being proposed by today's notice. One set of standards is
proposed under section 183(f) of the Act and would limit air emissions
of volatile organic compounds (VOC) and hazardous air pollutants (HAP)
from new and existing marine tank vessel loading and unloading
operations. These standards would require the application of reasonably
available control technology (RACT).
An additional set of standards is proposed under section 112(d) of
the Act and would limit air emissions of HAP from new and existing
marine tank vessel loading and unloading operations. These proposed
national emission standards for hazardous air pollutants (NESHAP) would
require existing and new major sources to control emissions using the
maximum achievable control technology (MACT).

DATES: Comments: Comments must be received on or before July 18, 1994.
Public Hearing: A public hearing will be held on June 15, 1994
beginning at 9:30 a.m.
ADDRESSES: Comments: Interested parties may submit comments (in
duplicate if possible) to: Air and Radiation Docket and Information
Center (6102), Attention: Docket No. A-90-44, U.S. Environmental
Protection Agency, 401 M Street, SW., Washington, DC 20460. The Agency
requests that a separate copy also be sent to the contact person listed
below.
Public Hearing: The public hearing will be held at the EPA's Office
of Administration Auditorium, Research Triangle Park, North Carolina.
Persons wishing to present oral testimony should contact Ms. Lina
Hanzely, Chemicals and Petroleum Branch (MD-13), U.S. Environmental
Protection Agency, Research Triangle Park, North Carolina 27711,
telephone number (919) 541-5673 by the dates specified above.
Technical Support Document: The technical support document (TSD)
for the proposed standards may be obtained from the U.S. Department of
Commerce, National Technical Information Service (NTIS), Springfield,
Virginia 22161, telephone number (703) 487-4650. Please refer to
``Technical Support Document for the Development of an Emissions
Standard for Marine Vessel Loading Operations'' (NTIS number PB93-
793910, EPA 450/3-92-001a). Electronic versions of the TSD as well as
this proposed rule are available for download from the EPA's Technology
Transfer Network (TTN), a network of electronic bulletin boards
developed and operated by the Office of Air Quality Planning and
Standards. The TTN provides information and technology exchange in
various areas of air pollution control. The service is free, except for
the cost of a phone call. Dial (919) 541-5742 for up to a 14,400 bits
per second (bps) modem. If more information on TTN is needed contact
the systems operator at (919) 541-5384.
Docket: Docket No. A-90-44, containing supporting information used
in developing the proposed standards, is available for public
inspection and copying from 8 a.m. to 4 p.m., Monday through Friday, at
the EPA's Air and Radiation Docket and Information Center, Waterside
Mall, room M-1500, Ground Floor, 401 M Street, SW., Washington, DC
20460. The proposed regulatory text and other materials related to this
rulemaking are available for review in the docket. A reasonable fee may
be charged for copying.

FOR FURTHER INFORMATION CONTACT: Mr. David Markwordt, Chemicals and
Petroleum Branch, Emission Standards Division (MD-13), U.S.
Environmental Protection Agency, Research Triangle Park, North Carolina
27711, telephone number (919) 541-0837.

SUPPLEMENTARY INFORMATION: The information presented in this preamble
is organized as follows:

I. Background
A. History
B. Legal Authority for Tank Vessel Standards
C. Process Description and Description of Control Technologies
II. Summary of the Proposed Standards
A. Source Category to be Regulated
B. Pollutants to be Regulated
C. Proposed Standards
D. Emission Points to be Regulated
E. Format for the Proposed Standards
F. Compliance Deadline
G. Initial Performance Tests
H. Vessel Tightness Testing
I. Monitoring
J. Recordkeeping and Reporting
III. Rationale
A. Selection of Affected Sources
B. Selection of Pollutants to be Regulated
C. Selection of Basis and Level of the RACT Standards
D. Selection of MACT Regulatory Approach
E. Selection of Basis and Level of Proposed MACT Standards
F. Selection of Format of the Standards
G. Selection of Test Methods
H. Selection of Monitoring and Compliance and Performance
Testing Requirements
I. Selection of Recordkeeping and Reporting Requirements
J. Solicitation of Comments
IV. Administrative Requirements
A. Public Hearing
B. Docket
C. Office of Management and Budget Reviews
D. Regulatory Flexibility Act Compliance

The proposed regulatory text is not included in this Federal
Register notice, but is available in Docket No. A-90-44 or by request
from the EPA contact persons designated earlier in this notice free of
charge. The proposed regulatory language is also available on the EPA's
Technology Transfer Network (TTN). See the Docket section of this
preamble for more information on accessing TTN.

I. Background

A. History

In 1982, the U.S. Department of Transportation's Maritime
Administration (MARAD) began working with the EPA regarding the
establishment of Federal regulations under the Clean Air Act pertaining
to air pollutants emitted from commercial marine vessels. The MARAD
raised concerns regarding the potential disruption of interstate and
foreign commerce and safety problems that may result from State
regulation of marine vessel emissions. The MARAD believed that the most
appropriate method to control these emissions without causing undue
disruption of commerce or safety problems would be for the EPA to
promulgate national standards regulating air pollutants from these
sources.
In 1985, the U.S. Department of Transportation requested that the
National Academy of Sciences' National Research Council (NRC) evaluate
the feasibility of controlling emissions from marine tank vessel
loading operations. At that time, many States were already considering
vapor controls for barge and tankship loading and tankship ballasting.
The NRC Commission on Engineering and Technical Systems (CETS) then
convened a Committee on Control and Recovery of Hydrocarbon Vapors from
Ships and Barges. This committee operated under the guidance of the
Marine Board of the NRC. The committee and the Marine Board consisted
of members of industry and academia and State representatives. The
Coast Guard (U.S. Department of Transportation) and the EPA also worked
with the committee on the feasibility study. In 1987, the committee
issued its report ``Controlling Hydrocarbon Emissions From Tank Vessel
Loading'' (Docket A-90-44, item II-I-4).
The Marine Board's report determined that controls were technically
feasible but that there was a need for the Coast Guard to promulgate
safety requirements and a need for the EPA to set uniform emissions
standards to mitigate some of the safety issues that could arise from
varied State regulations. The report recommended that the Coast Guard
``lead the development and implementation of a coordinated program to
ensure the safety and standardization of maritime hydrocarbon vapor
emissions controls.'' The Coast Guard would be responsible for the
safety issues involved (standardized equipment, detonation arrestors,
personnel training, etc.), and the EPA would be responsible for the
emissions standards. One of the methods suggested to achieve the
coordination necessary to develop standards for marine tank vessel
loading operations was an amendment to the Act.
Part of the Marine Board's task was to develop cost estimates. The
Marine Board contracted United Technical Design (UTD) to develop cost
estimates for three different model terminals and four model vessels.
These model terminals and costs served as the basis for the EPA costs
(Docket A-90-44, item II-I-5).
In response to the NRC recommendation, the Coast Guard's Chemical
Transportation Advisory Committee (CTAC) formed a Subcommittee on Vapor
Control to develop standards for designing and operating vapor control
systems. This CTAC subcommittee presented its final recommendations to
the Coast Guard in February 1989. The Coast Guard standards for safe
design, installation, and operation of marine vapor recovery equipment
were promulgated in June 1990 (55 FR 2596). The Coast Guard regulations
are found in 33 CFR part 154 and 46 CFR part 39.
As a result of the NRC recommendation, Clean Air Act Amendments of
1990 (the 1990 amendments) added a new section to the Act, section
183(f), that requires the EPA to promulgate standards applicable to
emissions of VOC and other air pollutants resulting from the loading
and unloading of tank vessels.
The 1990 amendments also revised section 112 of the Act to require
the EPA to publish a list of categories of major sources and area
sources of listed HAP and to promulgate emissions standards for each
listed category of emission sources. In the Agency's initial list of
categories of sources to be regulated under section 112(c) of the Act,
the marine vessel loading and unloading source category was not listed
because the Agency intended to regulate the emissions of HAP as well as
VOC under the authority of section 183(f) of the Act (57 FR 31566, July
16, 1992). After publication of this initial list of source categories,
the Agency decided to regulate HAP emissions from major sources of
marine vessel loading and unloading facilities under authority of
section 112 of the Act (58 FR 60021, November 12, 1993).

B. Legal Authority for Tank Vessel Standards

1. Clean Air Act Section 183(f)
Section 183(f) of the Act requires the Administrator, in
consultation with the Secretary of the Department in which the Coast
Guard is operating, to

Promulgate standards applicable to the emissions of VOC and any
other air pollutant from loading and unloading of tank vessels (as
that term is defined in section 2101 of title 46 of the United
States Code) which the Administrator finds causes, or contributes
to, air pollution that may be reasonably anticipated to endanger
public health or welfare. Such standards shall require the
application of reasonably available control technology, considering
costs, any non-air-quality benefits, environmental impacts, energy
requirements and safety factors associated with alternative control
techniques.

The Act further directed the Administrator to limit the application of
the standards, to the extent practicable, to loading and unloading
facilities and not to tank vessels. The standards were to be
promulgated within 2 years after enactment of the amended Act and must
be effective within 2 years of promulgation. The Coast Guard was
directed to issue regulations ``to insure the safety of the equipment
and operations which are to control emissions from the loading and
unloading of tank vessels * * *.''
2. Clean Air Act Section 112
Title III of the 1990 amendments revised section 112 of the Act to
reduce the amount of nationwide air toxics emissions. Under title III,
section 112 was amended to give the EPA the authority to establish
national standards to reduce air toxics from industries that generate
these emissions. Section 112(b) contains a list of 189 HAP, the
emissions of which are to be regulated. Specific HAP on the list
include benzene (including benzene from gasoline), toluene, and hexane.
Section 112(c) directs the EPA to use this pollutant list to develop
and publish a list of all categories of major and area sources of the
pollutants on the HAP list. National emissions standards for hazardous
air pollutants (NESHAP) will be developed for each of the source
categories on that list. The list of source categories was published in
the Federal Register on July 16, 1992 (57 FR 31576) and was revised to
include marine vessel loading and unloading operations on November 12,
1993 (58 FR 60021).
The NESHAP are to be developed to control HAP emissions from both
new and existing major and area sources according to the statutory
directives set out in section 112(d) of the Act. (Section 112(a)
defines a major source as any stationary source or group of stationary
sources located within a contiguous area and under common control that
emits or has the potential to emit considering control, 10 tons per
year or more of any HAP or 25 tons per year of any combination of HAP.
An area source is any stationary source that is not considered
``major''.) The statute requires the standards to reflect the maximum
degree of reduction in emissions of HAP that is achievable for new or
existing sources. This control level is referred to as the ``maximum
achievable control technology (MACT)'', the selection of which must
reflect consideration of the cost of achieving the emission reduction,
any nonair quality health and environmental impacts, and energy
requirements for control levels more stringent than the MACT floors.
The MACT floor is the minimum stringency level for MACT standards.
For new sources, MACT must be no less stringent than the level of
emission control already achieved in practice by the best controlled
similar source. For existing sources, MACT must be no less stringent
than the average emission limitation achieved by the best performing 12
percent of existing sources or the best performing 5 sources in
categories or subcategories with fewer than 30 sources.
Once the floor has been determined for new or existing sources for
a category or subcategory, the Administrator must set MACT standards
that ``shall require the maximum degree of emission reduction of the
hazardous air pollutants subject to this section * * * that the
Administrator, taking into consideration the cost of achieving such
emission reduction, and any non-air quality health and environmental
impacts and energy requirements, determines is achievable for new or
existing sources * * *.'' These standards must be no less stringent
than the MACT floor. Such standards must then be met by all sources
within the category or subcategory. In establishing standards, the
Administrator may distinguish among classes, types, and sizes of
sources within a category or subcategory.

C. Process Description and Description of Control Technologies

1. Process Description
Marine tank vessel loading operations are facilities that load and
unload liquid commodities (e.g., crude oil, gasoline, jet fuel,
kerosene, toluene, alcohols, fuel oil Numbers 2 and 6, some chemicals,
and groups of solvents or petrochemical products, etc.) in bulk. The
cargo is pumped from the terminal's large, above-ground storage tanks
through a network of pipes and into a storage compartment (tank) on the
vessel. Most marine tank vessel loading operations are associated with
petroleum refineries or synthetic organic chemical manufacturers, or
are independent terminals.
Gasoline, crude oil, and other VOC- and HAP-emitting commodities
are normally delivered from refinery to terminal or terminal to
terminal via pipeline, ship, or barge. During marine tank vessel
loading operations, emissions result as the liquid that is being loaded
into the vessel displaces vapors from the vessel's tank. The vapors
emitted fall into two categories: Arrival emissions and generated
emissions. Arrival emissions are attributed to any vapors remaining in
the otherwise empty cargo tanks prior to loading. Generated emissions
refer to vapors resulting from the evaporation of the liquid cargo as
it is loaded. The ratio of arrival vapors to generated vapors can vary
greatly depending upon the liquid, vapor pressure, loading method, and
loading conditions.
The major emission points for marine vessel loading operations
include open tank hatches and overhead vent systems. Overhead vent
systems collect vapors displaced during loading and route them to a
vertical pipe or stack. The vapors are released well above the height
of the deck with an upward velocity to help isolate the vapors from the
deck. Other possible emission points are hatch covers or domes,
pressure-vacuum relief valves, seals, and vents.
Emissions may also occur during ballasting, which is the process of
drawing ballast (i.e., water) into a cargo hold. When ballast is loaded
into tanks that contain vapors from the preceding cargo, the vapor is
displaced and emitted from the vessel. Most tankships carrying crude
oil built since 1980 are required by domestic law and international
agreement to use segregated ballast tanks, which prevent the
possibility of ballast emissions (see also: The Port and Tanker Safety
Act (1978), the Act to Prevent Pollution from Ships (1980), the Marine
Vapor Control System Standards (55 FR 25396, June 21, 1990); and the
Double Hull Standards for Tank Vessels Carrying Oil (57 FR 36221,
August 12, 1992). However, some older and smaller tankships may be
exempt from these requirements. Inland barges do not carry ballast.
2. Control Technologies
The description of control technologies has two components, the
capture of vapors and the destruction or recovery of VOC and HAP. The
capture of vapors at the marine vessel requires that the compartments
on both tankships and barges be closed to the atmosphere during
loading. Most tankships are already equipped for closed loading as a
result of having inert gas systems on board because closed loading is
necessary to maintain the legally required minimum inert gas pressure
in the cargo tanks in accordance with Coast Guard regulations (46 CFR
32.53 and 46 CFR 153.500). Barges generally do not use inert gas and
are usually open loaded. Equipment necessary for closed loading
includes (1) devices to protect tanks from underpressurization and
overpressurization, (2) level-monitoring and alarm systems to prevent
overfilling, and (3) devices for cargo gauging and sampling.
The vapor emissions captured from marine tank vessel loading
operations can be controlled using one of two primary methods:
Combustion or recovery. Combustion devices include flares, enclosed
flares, and thermal and catalytic incinerators. The primary recovery
methods are carbon adsorption, absorption, vapor balancing, and
refrigeration. (For a more complete discussion of the capture and
control techniques, consult the technical support document (TSD)
previously mentioned in the ADDRESSES section.)

II. Summary of the Proposed Standards

The following summarizes the proposed standards. A full discussion
of the rationale underlying these proposed regulations is found in part
III.

A. Source Category To Be Regulated

The source category to be regulated is major source marine tank
vessel loading and unloading operations. Regulations will require those
operations exceeding certain gasoline or crude oil throughput cutoffs
or certain HAP emissions cutoff at major sources to install vapor
control systems. Approximately 300 marine tank vessel loading and
unloading operations would be affected by these proposed regulations.
Vessels loading at affected sources must meet vapor tightness criteria
in order to load product.
The source category includes only emissions that are directly
caused by the loading and unloading of bulk liquids at points where
marine terminal equipment is connected to marine vessel sources. Thus,
this source category does not include storage tanks and leaking
equipment associated with terminal transfer operations. Nor does this
source category include emissions from offshore vessel-to-vessel bulk
liquid transfer operations (i.e., lightering operations). Lightering
operations do not take place at onshore terminals. The Agency may
consider addressing lightering operations in a separate source
category.

B. Pollutants To Be Regulated

The pollutants to be regulated are all VOC and HAP emitted during
marine tank vessel loading and unloading operations.

C. Proposed Standards

The proposed standards are developed under sections 183(f) and
112(d) of the Act. As discussed above, section 183(f) requires the
promulgation of standards implementing reasonably available control
technology (RACT). Section 112(d) requires the promulgation of maximum
achievable control technology (MACT), which is selected using different
criteria than are used for determining RACT. As a result, RACT
standards developed under section 183(f) have somewhat different
applicability criteria, as well as a different level of emissions
reduction, compared to the section 112(d) MACT standards. However, the
majority of requirements (e.g., reporting, recordkeeping, performance
tests, monitoring) are identical. In order to simplify the regulatory
process, both sets of standards, RACT and MACT, are presented in a
single regulation and proposed under 40 CFR part 63.
1. Proposed RACT Standards
Existing and new sources exceeding either of the throughput cutoffs
of 790 million liters per year (L/yr) (5 million barrels per year (bbl/
yr)) of gasoline or 16 billion L/yr (100 million bbl/yr) of crude oil
must meet the RACT requirement of capture and control of vapors from
marine vessel loading operations. The EPA believes that approximately
25 terminals will be required to install controls under these proposed
standards. The RACT for marine vessel loading operations is a capture
system consisting of a vapor tight marine vessel and all of the piping
and equipment necessary to route all VOC vapors to a control device
connected to either a thermal destruction device or a recovery device.
If a thermal destruction device is used to process vapors, 98 percent
destruction efficiency must be achieved. If a recovery device is used
to process the vapors, 95 percent recovery must be achieved, or as an
alternative, for recovery of gasoline vapor emissions, a source must
ensure an outlet concentration of 1,000 parts per million by volume
(ppmv) or less.
2. Proposed MACT Standards
New marine vessel loading operations exceeding 1 megagram per year
(Mg/yr) (1.1 tons per year) of uncontrolled HAP emissions that are
located at major sources must meet the MACT requirement of capture and
control of vapors from marine vessel loading operations. The MACT for
new marine vessel loading operations is a capture system consisting of
a vapor tight marine vessel and all of the piping and equipment
necessary to route all VOC vapors to a control device that is capable
of reducing HAP emissions to the atmosphere by 98 percent.
Existing marine vessel loading operations exceeding approximately 1
Mg/yr of HAP emissions that are located at major sources must meet the
same vessel tightness requirements as new sources. The EPA believes
that approximately 300 terminals will be affected by these proposed
standards. These operations will have a MACT emissions requirement of
93 percent emission reduction. Control devices used to achieve this
emission limit are required to operate at 95- and 98 percent removal
efficiencies respectively. However, these facilities have the option of
exempting emissions of one or more commodities from control provided an
overall 93 percent emission reduction is achieved. This overall
emission reduction may be demonstrated by controlling all but a few
commodities loaded. Partial control of any given commodity would not be
allowed under the proposed compliance provisions.
At both new and existing sources, emissions from ballasting
operations would be prohibited. Emissions of HAP from steam stripping
used to regenerate carbon beds when carbon adsorption is used to
control emissions from marine vessel loading operations would also be
prohibited under today's proposed standards.
3. Source Reduction and Recycling
The Pollution Prevention Act of 1990 (Pub. L. 101-508; 42 U.S.C.
13101 et seq., ER 71:0501) establishes the following pollution
prevention hierarchy as national policy:
a. Pollution should be prevented or reduced at the source wherever
feasible;
b. Pollution that cannot be prevented should be recycled in an
environmentally safe manner wherever feasible;
c. Pollution that cannot be prevented or recycled should be treated
in an environmentally safe manner wherever feasible; and
d. Disposal or other release into the environment should be
employed only as a last resort and should be conducted in an
environmentally safe manner.
Pollution prevention means ``source reduction,'' as defined under
the Pollution Prevention Act, and other practices that reduce or
eliminate the creation of pollutants. Source reduction is any practice
that reduces the amount of any hazardous substance entering the waste
stream or otherwise released into the environment prior to recycling,
treatment, or disposal. Source reduction does not include any practice
which alters the physical, chemical, or biological characteristics or
the volume of a hazardous substance, pollutant, or contaminant through
a process or activity which itself is not integral to and necessary for
the production of a product or the providing of a service. Under the
Pollution Prevention Act, recycling, energy recovery, treatment and
disposal are not included within the definition of pollution
prevention. Some practices commonly described as ``in-process
recycling'' may qualify as pollution prevention.
Pollution prevention principles have been incorporated into the
proposed marine vessel standards. The proposed prohibition of emissions
from ballasting and steam stripping operations has the effect of
preventing pollution from occurring at the source. Alternative
processes (i.e., segregated ballast tanks and vacuum regeneration) are
readily available, widely used, and have the benefit of not resulting
in HAP or VOC emissions.
Although not considered pollution prevention, vapor recovery and
recycling is a common practice in this industry, particularly gasoline
recovery (the lower vapor pressure crude oils are less conducive to
recovery and are more likely to foul the carbon bed). The proposed
standards encourage vapor recovery by allowing the use of well-
operated and maintained recovery devices that operate at 95-percent
emission reduction. Recovery devices are desirable compared to
combustion devices because the recovered compounds can be reused in
other processes, which reduces the quantity of virgin materials that
must be produced. Recovery devices also tend to generate fewer
secondary pollution impacts than do combustion devices.

D. Emission Points To Be Regulated

The emission points to be regulated include all means of venting
the tank during loading of product or ballast. These include, but are
not limited to, open hatches and/or overhead vent systems. The proposed
rulemakings will not directly regulate seals, hatches, or covers
associated with the marine tank vessel. However, these items must be in
satisfactory condition for the vessel to pass one of the three
different marine tank vessel tightness tests, and must remain closed
during the loading process.

E. Format for the Proposed Standards

The chosen format for the standards for product loading is a
percentage of mass emissions reduction. An alternative format for
gasoline vapor recovery, a maximum allowable concentration for the
vapor processor exhaust is also proposed. Emissions are prohibited from
ballasting operations and from regeneration of carbon adsorber beds.

F. Compliance Deadline

The compliance deadline for existing sources affected by the RACT
standards is 2 years after the date of promulgation. The compliance
deadline for existing sources affected by the MACT standards is 2 years
after the date of promulgation. An existing source that subsequently
exceeds a RACT throughput cutoff will have 2 years to comply once the
source exceeds a throughput cutoff. Similarly, any source that exists
as of the effective date of the standards and subsequently exceeds the
MACT applicability thresholds would have 2 years to comply with the
existing source MACT standards. All other new or reconstructed
facilities will have to comply upon startup, with the exceptions noted
in Sec. 63.6 of the part 63 General Provisions.

G. Initial Performance Tests

Owners or operators must perform initial performance tests as
required by Sec. 63.7 of the General Provisions for all combustion or
recovery devices except devices such as boilers or process heaters
where the emissions stream is the primary fuel or boilers and process
heaters having a design heat input capacity of 44 megawatts or more.
The test method for compliance for combustion devices is the EPA Method
25 of appendix A of 40 CFR part 60. The test method for compliance for
recovery devices is the EPA Method 25A of appendix A of 40 CFR part 60.
Flares are not subject to the same tests as other control devices, but
must pass a visible emissions test according to the requirements of
Method 22 of appendix A of 40 CFR part 60. The performance tests must
be conducted to include the loading of the last 20 percent of a
compartment, and may be spread out over multiple compartments.

H. Vessel Tightness Testing

Three alternatives to ensure vessel tightness are proposed: (1)
Pressure test the vessel, (2) perform a leak test on all components
using Method 21 of appendix A of 40 CFR part 60, or (3) load the vessel
at less than atmospheric pressure.

I. Monitoring

Owners or operators using a vent system that contains valves that
could divert a vent stream from a control device must either monitor
vent stream flow to ensure that it is not diverted from a control
device or secure the bypass line valve in the closed position.
Monitoring criteria have been established for combustion devices
(except flares), carbon adsorbers, condensers and adsorbers. In
general, facilities would be required to establish operating parameters
during the initial performance test and then monitor combustion
temperature for combustion devices, VOC concentration in the exhaust
stream outlet for carbon adsorbers, exhaust stream temperature for
condensers, and VOC outlet concentration for adsorbers. In the case of
flares, owners or operators would be required to monitor for the
continuous presence of a flame and to monitor vent stream flow. Owners
or operators seeking to use other types of control devices may develop
enhanced monitoring criteria for these devices and submit the criteria
to the Administrator for approval.

J. Recordkeeping and Reporting

Sources required to install controls would have to fulfill the
reporting and recordkeeping requirements of the part 63 General
Provisions including submittal of the following reports: (1) Compliance
notification report, (2) notification of initial performance test, (3)
report of initial performance test, (4) quarterly parameter exceedance
report, and (5) quarterly emissions estimation report. These sources
must also maintain documentation that vessels loaded at the facility
are vapor tight. All information will be made readily available to the
Administrator or delegated State authority for a minimum of 5 years.

III. Rationale

A. Selection of Affected Sources

The primary release of vapors during the marine tank vessel loading
process occurs at the tank vessel through hatches, vents, and vent
systems. However, it is impractical for marine tank vessels to carry
their own vapor processing systems given the limited space on
individual vessels. It is also much more economical for terminals to
install and operate control devices that are capable of controlling
emissions from multiple vessels than for each vessel to control its own
emissions. Furthermore, section 183(f) requires that ``to the extent
practicable such standards shall apply to loading and unloading
facilities and not to tank vessels.'' Therefore, these regulations
require that terminals install an air pollution control device and a
means of routing the air/vapor mixture from the vessel to the air
pollution control device.
Vessels will not be allowed to load or unload product unless they
are compatible with terminal air pollution control systems or have a
self contained emissions control system on board. Therefore, vessels
loading at a controlled terminal will need to have their own vapor
collection systems (i.e., pipes which allow for connection to terminal
air pollution control system) in order to route vapors to shore.
However, vessels are not required to load at controlled terminals. As a
result, the affected source is limited to the terminal, which is in
turn required to capture and control all loading emissions, with the
exception of ballasting and off-shore terminal emissions which are
discussed elsewhere in this preamble. Emissions from off shore vessel-
to-vessel bulk liquid transfer operations (i.e., lightering operations)
are also not included as a source affected by these standards because
these operations do not take place at onshore terminals.

B. Selection of Pollutants To Be Regulated

Section 183(f) of the Act states that the Administrator shall
``promulgate standards applicable to the emission of VOC and any other
pollutant from loading and unloading of tank vessels which the
Administrator finds causes, or contributes to, air pollution that may
be reasonably anticipated to endanger public health or welfare.'' Under
section 112(d), the EPA is also required to regulate the emissions of
HAP from source categories listed pursuant to section 112(c). Marine
vessel loading operations were listed on November 12, 1993 (58 FR
60021). In the absence of regulation, the EPA estimates that 75,200 Mg/
yr of VOC will be emitted as a result of tank vessel loading
operations. Approximately 8,000 Mg/yr of these VOC emissions will be
emissions of HAP. Tank vessel loading operations emit approximately 53
different substances listed as HAP under section 112(b) of the Act.
Such emissions include unregulated benzene emissions of about 700 Mg/
yr. In addition, approximately 6,900 Mg/yr of hexane, toluene, xylene
compounds, ethyl benzene, iso-octane, MTBE, naphthalene, and cumene are
emitted from tank vessel loading operations. Approximately 44 HAP
comprise the remaining four percent of toxic emissions.
Benzene is a known human carcinogen. It has been demonstrated to
increase the incidence of nonlymphocytic leukemia in occupationally
exposed individuals. It has also been linked to other leukemias, as
well as lymphomas and other tumor types in animal studies. Benzene has
also been associated with a number of adverse noncancer health effects,
including effects on the blood system and the immune system. The other
HAP identified above also may induce adverse health effects, including
depression of the central nervous system, upper respiratory tract and
eye irritation, skeletal abnormalities, anemia, cataracts, kidney
damage and liver damage.
As a result of its authority to regulate emission from tank vessel
loading operations under both section 183(f) and section 112(d), the
EPA shall regulate emissions of VOC and those HAP included on the list
under section 112(b) in this rulemaking.

C. Selection of Basis and Level of the RACT Standards

1. Development of Regulatory Alternatives
In deciding how to implement the RACT provisions of section 183(f),
the EPA had to determine whether or not all tank vessel loading
terminals should be subject to the standards (i.e., whether there
should be ``cutoffs'' below which a terminal would not be subject to
the standards) and what level of control would be appropriate.
Consistent with the requirements of section 183(f) calling for the
consideration of costs and other non-air quality impacts, as well as
the general requirements under RACT to review economic feasibility, the
EPA believes that section 183(f) gives the EPA the flexibility to
determine the level and scope of regulation that is most appropriate
for terminal facilities, given all of the factors indicated.
Assuming 100 percent capture of emissions (which can be assumed
when vapor tight vessels are loaded), the overall level of control is
determined by the efficiency of the control device to which emissions
are ducted. Currently, recovery devices (e.g., carbon adsorption,
absorption, vapor balancing and refrigeration) are capable of achieving
a 95 percent efficiency compared to a 98 percent efficiency achieved by
thermal destruction (combustion) devices (e.g., flares, enclosed
flares, and thermal and catalytic incinerators). Additional information
and descriptions of these control technologies are found in the TSD for
this rulemaking (see ADDRESSES section). For purposes of the regulatory
alternative analysis, the use of a thermal destruction device (i.e., 98
percent efficiency) was assumed. The control technologies selected for
this regulation are discussed in part 4 below.
The next step was to identify regulatory alternatives that would
allow the EPA to choose among different optimal cutoffs specifying what
types of terminals would have to install control devices. The EPA chose
commodity and throughput as factors to distinguish among alternatives
because commodities with higher vapor pressures have higher emissions
and, for a given commodity, terminals with higher throughput loading
similar vessels have higher emissions.
Table 1 is a summary of the five regulatory alternatives developed
by the EPA. The regulatory alternatives varied in stringency from
controlling all emissions at all facilities to controlling only
gasoline loadings at terminals with annual throughputs greater than
1,590 million liters (10 million bbl/yr) and crude oil terminals with
throughputs greater than 15,900 million liters/yr (100 million bbl/yr).
The control levels are all based on the capture of loading emissions
from marine vessels and a 98 percent removal efficiency. Each
regulatory alternative is structured such that the emissions and
resulting cost-effectiveness values from each commodity at the stated
throughput are roughly equivalent. For example, the costs of
controlling emissions from 10 million barrels of gasoline is treated as
being roughly equivalent to the costs of controlling emissions from 100
million barrels of crude oil because the emissions per volume of
gasoline is ten times higher than for crude oil. (For a more complete
rationale behind the selection of the regulatory alternatives, consult
the technical support document (TSD) previously mentioned in the
ADDRESSES section.)

Table 1.--RACT Regulatory Alternatives^{a
--------------------------------------------------------------------------------------------------------------------------------------------------------
VOC Incremental
emissions Percent VOC No. of Capital Annual Cost cost
Alternatives, throughput (MM bbl/yr) reduction, emissions affected costs, $ costs, $ effectiveness, effectiveness,
Mg/yr^{b reduction^{b terminals million^{c million^{c $/Mg $/Mg
--------------------------------------------------------------------------------------------------------------------------------------------------------
I. Gasoline >10 MM bbl/yr.............................. 53,200 66 13 220 41 770 N/A
Crude oil >100 MM bbl/yr
II. Gasoline >5 MM bbl/yr.............................. 58,100 72 25 280 53 910 2,500
Crude oil >100 MM bbl/yr
III Gasoline >1 MM bbl/yr.............................. 64,500 80 60 420 85 1,300 5,000
Crude oil >10 MM bbl/yr
IV. Gasoline >0.5 MM bbl/yr............................ 66,900 83 120 570 120 1,800 15,000
Toluene >0.5 MM bbl/yr
Alcohols >1.5 MM bbl/yr
Crude oil >5 MM bbl/yr
V. All terminals....................................... 72,000 98 1,500 2,600 610 8,500 96,000
--------------------------------------------------------------------------------------------------------------------------------------------------------
A^{a Terminals affected by State regulations or loading less than 1,000 bbl/yr are not included in the above estimates.
A^{b Based on a 98-percent control efficiency and total VOC emissions of 74,000 Mg/yr.
A^{c Costs are in 1990 dollars.

ASource: Docket A-90-44, items II-A-23 and II-A-32.

The analysis leading to a decision to regulate emissions from
ballasting and steam stripping operations is presented in section D,
Selection of MACT Regulatory Approach.
2. Impacts of the Regulatory Alternatives
The EPA developed model (i.e., example) vessels and terminals for
use in estimating the environmental, cost, and economic impacts
associated with the actual terminals represented by the waterborne
commerce in the United States (WCUS) data base. The impacts that
resulted from this analysis are presented in Tables 1 through 3. The
EPA performed an economic impact analysis of the regulatory
alternatives considered for these regulations. Potential price, output,
and employment impacts for affected products and for the marine
transport industry and for small businesses were examined. Estimated
maximum price increases for any product loaded in bulk varied but were
not large under any of the regulatory alternatives. These price
increase estimates reflect the control cost increase for both
transporting crude and transporting refined products. Because the price
increases are small and because the elasticities of demand for
petroleum products are small, estimated percent output (i.e.,
throughput) reductions were minimal in all but Regulatory Alternative
V. Correspondingly, estimated employment reductions were also small
(less than 20) in all but Regulatory Alternative V.

Table 2.--Secondary Air and Energy Impacts of RACT Regulatory Alternatives^{a ^{b
----------------------------------------------------------------------------------------------------------------
SOX NOX CO Electricity Natural gas
Alternatives, throughout (MM bbl/yr) emissions, emissions, emissions, impacts, impacts, 1,000
Mg/yr^{c Mg/yr^{c Mg/yr^{c MWh/yr^{d ft\3\/yr^{d
----------------------------------------------------------------------------------------------------------------
I. Gasoline >10 MM bbl/yr................... 61 130 120 3,000 340,000
Crude oil >100 MM bbl/yr
II. Gasoline >5 MM bbl/yr................... 61 150 140 5,400 620,000
Crude oil >100 MM bbl/yr
III. Gasoline >1 MM bbl/yr.................. 65 180 170 11,000 1,300,000
Crude oil >10 MM bbl/yr
IV. Gasoline >0.5 MM bbl/yr................. 65 190 180 20,000 2,200,000
Toluene >0.5 MM bbl/yr
Alcohols >1.5 MM bbl/yr
Crude oil >5 MM bbl/yr
V. All terminals............................ 69 250 230 170,000 16,000,000
----------------------------------------------------------------------------------------------------------------
^{aTerminals affected by State regulations or loading less than 1,000 bbl/yr are not included in the above
estimates.
^{bBased on use of incineration.
^{cThese impacts represent increases in emissions; increases would not be expected if all affected sources used
recovery technologies.
^{dThese impacts represent increases in energy usage.

Source: Docket A-90-44, item II-A-24.

Table 3.--Summary of RACT Economic Impacts by Regulatory Alternative
--------------------------------------------------------------------------------------------------------------------------------------------------------
No. of
Terminals covered/ Maximum Percent terminals
Reg. alt. throughout, MM BBL/ Total cost, percent price output Employment under Impact on vessels Displacement potential by
yr MM increases reductions reductions competitive pipeline
pressure
--------------------------------------------------------------------------------------------------------------------------------------------------------
I............ Gasoline >10.0...... 41 0.16-0.19 0.02 <50 0 Low level of Minimal.
dedication.
Crude oil >100...... ........... 0.10-0.18 ND ........... ........... .................... .........................
II........... Gasoline >5.0....... 53 0.18-0.21 0.02 <50 0-5 Low level of Minimal.
dedication.
Crude oil >100...... ........... 0.10-0.18 ND ........... ........... .................... .........................
III.......... Gasoline >1.0....... 85 0.25-0.29 0.02 ........... ........... Moderate level of Minimal.
dedication.
Crude oil >10.0..... ........... 0.18-0.31 ND 119 0-30 .................... .........................
IV........... Gasoline >0.5....... 120 0.32-0.37 0.03 ........... ........... Significant level of Minimal.
dedication.
Crude >5.0.......... ........... 0.18-0.32 ND 165 0-65 .................... .........................
Alcohols >1.5....... ........... 0.60 0.04 ........... ........... .................... .........................
Toluene >10.0....... ........... 0.41 ........... ........... .................... .........................
V............ All................. 610 0.3-1.8 0.07- 924 >1,000 High level of Some in long run.
0.26 dedication to
regulated products.
--------------------------------------------------------------------------------------------------------------------------------------------------------
ND=Not determinable, function of other products derived from crude oil.

Reference: Docket A-90-44, items II-A-23 and II-A-32.

Because today's proposed regulation involves the application of
both RACT and MACT, impacts for each standard were determined
separately. In order to avoid overestimation or double-counting, and
because the requirements for RACT are more stringent than MACT, the
impacts for facilities affected by RACT (i.e., facilities with gasoline
throughputs of greater than 790 million L/yr (5 million bbl/yr) or
crude oil throughputs of greater than 16 billion L/yr (100 million bbl/
yr)) were calculated first, and were discounted when determining the
impacts for facilities affected by MACT (i.e., facilities emitting
greater than 1 Mg/yr of HAP).
3. RACT Threshold Determination
The Administrator is proposing Regulatory Alternative II as the
regulatory threshold for the RACT standard. Regulatory Alternative II
would require controls for crude oil loadings at facilities with an
crude oil marine throughput of approximately 15,900 L/yr (100 million
bbl/yr) or more, and gasoline loadings at facilities with a gasoline
throughput of approximately 795 million L/yr (5 million bbl/yr).
Approximately 25 terminals (1.5 percent of all terminals) will be
affected if the thresholds for Regulatory Alternative II are
implemented. In addition, under this alternative, only a small volume
of U.S. marine vessels will need to be retrofitted. It is anticipated
that only those vessels that are least costly to retrofit would be
retrofitted. Approximately 76 percent of the VOC emissions from all
marine terminals would be controlled at an average cost effectiveness
of approximately $770/Mg of VOC reduced under Regulatory Alternative
II.
The Administrator believes that the incremental cost effectiveness
($5,000/Mg) of going beyond Regulatory Alternative II is inappropriate
given this standard.
Regulatory Alternative III was strongly considered. However, the
additional 35 terminals controlled under Regulatory Alternative III
would produce only an additional eight percent reduction in nationwide
emissions. Of those 35 additional terminals, as many as 25 could be
under increased competitive pressure, compared to only up to five
terminals under Regulatory Alternative II. (Increased competitive
pressure refers to the situation where the controlled terminal is in
direct competition with a much smaller or larger terminal. The smaller
terminal may not be controlled and the larger terminal may be able to
control vapors more effectively on a per-barrel basis. The controlled
terminal could be forced to absorb some of the control costs, reduce
throughput, substitute nonregulated products, or close the facility.)
Additionally, the more stringent regulatory alternatives considered
involved control of commodities which have vapor pressures much lower
than gasoline and crude oil. Emissions generally correspond to the
vapor pressure of the commodity being loaded. Gasoline and crude oil
generally have the highest vapor pressures, and therefore present
better control alternatives. Because the economic and other
environmental impacts of Regulatory Alternative II are reasonable and
should not place an undue burden on industry or the environment, the
Administrator selected Regulatory Alternative II as representative of
RACT.
4. Selection of Emission Control Technologies and Emission Control
Standards for RACT
Control of marine vessel loading emissions requires the capture of
displaced vapors and efficient control of vapors once captured. Vessels
loading at facilities with controls must install a vapor collection
system and pass one of three tank vessel tightness alternatives to
ensure good capture of vapors. The tightness alternative may be one of
the following: (1) A leak check performed during loading on all
components using Method 21 of appendix A of 40 CFR part 60; (2) a
pressure test, where the internal tanks are pressurized and the
pressure drop is monitored over time to determine if the vessel is
tight; or (3) for noninerted vessels (i.e., vessels having tanks that
are not blanketed with nonreactive gas during loading to ensure that
vapors in the tanks are below the explosive range), load the vessel at
less than atmospheric pressure. These tightness alternatives are the
same as those promulgated in the NESHAP for benzene (40 CFR part 61
subpart BB). The EPA does not have sufficient data necessary to
determine at what point vessel leaks affect the operation and
efficiency of the control system; however, the Agency believes that the
three tightness alternatives proposed are sufficient to provide for the
collection of nearly all displaced vapors. The EPA believes that once
assured of good capture and collection of the vapors through the
tightness tests, facilities can concentrate on the operation and
maintenance of the control device as a means of ensuring compliance.
The EPA is proposing that vapor emissions captured from marine tank
vessel loading operations can be controlled using one of two primary
methods: Combustion or recovery. The primary devices used for
combustion of vapors are flares, enclosed flares (often referred to as
thermal oxidizers), catalytic incinerators, and thermal incinerators.
The primary methods for recovery of vapors include carbon adsorption,
absorption, refrigeration, and vapor balancing. In States with marine
tank vessel loading standards that allow both combustion and recovery,
the control devices are evenly split between enclosed flares and carbon
adsorption.
The EPA is proposing that standards for the control of vapors
captured during the loading operations be one of the following: (1) A
combustion device meeting 98 percent or greater destruction efficiency
or (2) A recovery device meeting 95 percent or greater recovery
efficiency. The difference in control efficiencies between recovery and
combustion is designed to not prohibit recovery systems, which have
smaller secondary air emission (sulfur dioxide, nitrous oxides, and
carbon monoxide) impacts than combustion systems. The smaller emissions
reduction is also warranted because these emissions are recovered as
product instead of destroyed. Additionally, the EPA has data supporting
the 95- and 98-percent control efficiencies as achievable for recovery
and combustion devices, respectively (Docket A-90-44, items II-A-7 and
II-B-1). For terminals that use recovery devices for control of
gasoline vapor emissions, the EPA is proposing an alternative means of
compliance. Such sources can comply by ensuring an outlet concentration
of 1,000 ppmv or less for emissions from gasoline loadings. The EPA
believes the 1,000 ppmv limit for gasoline vapor is generally more
strict than the 95 percent reduction requirement. Data from an existing
facility show this limit to be achievable (Docket A-90-44, item II-B-
13). The intent of the concentration alternative is to allow those
facilities that operate at a higher efficiency than required by the
proposed standard to perform a simpler compliance test, as they would
only have to test at the outlet of the control device. Because of the
lower emission factors associated with crude oil emissions, the fact
that hydrogen sulfide present in crude oil may poison the activated
carbon, and that there are no known facilities controlling crude oil
emissions with carbon adsorbers, the EPA is not proposing a
concentration alternative for controlling vapors from crude oil
emissions.
5. Impacts of the Proposed RACT Standards
The environmental, costs, energy, and economic impacts of the
proposed RACT standards are summarized in Tables 1 through 3, and are
represented by Regulatory Alternative II. They are also discussed in
parts C.2. and C.3. above. Economic effects of the proposed RACT
standards include a maximum price increase of approximately 0.2 percent
and nationwide employment reductions of less than fifty. Up to five
terminals controlled under the proposed standards could be under
increased competitive pressure. Economic effects on oil tankers include
an average control cost per barrel of crude oil loaded equal to $0.002.
A primary concern in the implementation of the proposed standards
is safety. Section 183(f)(1) dictates that the EPA consult with the
Coast Guard and consider safety when promulgating these standards.
Section 183(f)(2) states:

Regulations on Equipment Safety.--Within 6 months after the date
of the enactment of the Clean Air Act Amendments of 1990, the
Secretary of the Department in which the Coast Guard is operating
shall issue regulations to ensure the safety of the equipment and
operations which are to control emissions from the loading and
unloading of tank vessels, under section 3703 of title 46 of the
United States Code and section 6 of the Ports and Waterways Safety
Act (33 U.S.C. 1225). The standards promulgated by the Administrator
under paragraph (1) and the regulations issued by a State or
political subdivision regarding emissions from the loading and
unloading of tank vessels shall be consistent with the regulations
regarding safety of the Department in which the Coast Guard is
operating.

The Coast Guard regulations (55 FR 25396) were promulgated in June
1990, before the passage of the amended Act. These standards dictate
equipment, system, and operational requirements for vapor control
systems for benzene, gasoline, and crude oil. The EPA has maintained
communication with the Coast Guard throughout the rulemaking process.
All control systems installed as a result of this proposed regulation
would be subject to the Coast Guard regulations, and nothing in the
proposed standard should be construed as to require any act or omission
that would be in violation of any regulation or other requirements of
the United States Coast Guard or prevent any act or omission necessary
to secure the safety of a vessel or for saving life at sea.
Representatives from the United States Coast Guard have participated in
all phases of the development of these proposed rules. The EPA is
confidant that these regulations are consistent with the Coast Guard
regulations and that the safety factors have been adequately addressed.
6. Attainment/Nonattainment Status and Site Specific Risk Assessment
At one time, the Agency was considering planning regulating based
exclusively under the authority of section 183(f). During this time,
the Agency held a public meeting to discuss a possible approach for
considering a facility's attainment/non-attainment status with respect
to NAAQS ozone program and a facility's site specific risk to the
public in developing the standards (see Docket A-90-44, item II-E-42).
This approach would have required intensive effort on the part of the
Agency and the regulated community to develop acceptable criteria and
technological methodologies for demonstrating whether the criteria have
been met. However, with regulation under section 112, any facility that
might have been exempted from RACT under section 183(f) with the
approach discussed at the public meeting would ultimately be regulated
under the MACT standards of section 112. Therefore, no further
consideration was given to this approach.

D. Selection of MACT Regulatory Approach

1. Area Source Finding
The HAP emitted from this source category include benzene, toluene,
hexane, xylene, and ethylbenzene from gasoline and crude oil loading as
well as approximately 60 HAP from alcohols and specialty chemicals. Of
the approximately 1,800 marine vessel terminals in this source
category, at least 60 emit 25 ton/year of HAP or more, and are
therefore considered major sources. In addition, under section
112(a)(1), a marine vessel terminal may be a part of a major source if
it is part of a ``group of stationary sources located within a
contiguous area and under common control that emits or has the
potential to emit considering controls, in the aggregate, 10 tons per
year or more of any hazardous air pollutant or 25 tons per year or more
of any combination of hazardous air pollutants.'' There are
approximately 600 refineries and chemical production facilities in the
United States; all of these are considered to be major sources. While
the Agency does not have the data in its marine vessel data base to
estimate how many of these facilities have bulk marine loading
terminals that are contiguous to and under the same control as the main
facility, there is a high correlation between large refineries and
production facilities and large bulk loading terminals. Therefore, at a
minimum, for purposes of this analysis, the Agency assumed that
approximately 300 terminals are major sources because they are likely
to be located at major sources such as refineries or chemical
production facilities. This leaves approximately 1,200 facilities that
are considered likely area sources. Based on the emissions data
contained in the Agency's data base, these 1,200 facilities represent
only 2 percent of nationwide HAP emissions.
Section 112(c)(3) states that categories of area sources emitting
HAP may be listed and regulated if the Administrator finds the sources,
individually or in the aggregate, present a threat of adverse effects
to human health or the environment. Based on limited data available to
the Agency, the Administrator is unable to determine a threat of
adverse effects at this time. Therefore, the Agency is proposing not to
regulate such area sources in this rulemaking. This is consistent with
the Agency's decision not to include in its initial list of source
categories those categories that contained no major sources and for
which the Agency had not made a finding of threat of adverse effects
(57 FR 31576, July 16, 1992). The Agency may, however, revisit these
sources in the future, if additional data become available.
2. Determination of Subcategories
The source category to be regulated is major sources of marine
vessel loading and unloading operations. As part of the NESHAP
development process, the source category was evaluated to determine if
subcategorization of the source category was justified. Although the
Act does not specify the criteria from which subcategories can be
developed, section 112(d)(1) of the Act states that the ``Administrator
may distinguish among classes, types, and sizes of sources within a
category or subcategory * * *.'' The Agency believes that these same
criteria are acceptable criteria to use in making subcategory
determinations.
Size appears to be a likely candidate for a distinguishing feature,
and using total estimated HAP emissions as an indicator for size, the
EPA evaluated marine tank vessel loading operations to determine
whether it was appropriate to subcategorize the source category on the
basis of size. The limit for determining subcategories was examined in
0.5 Mg increments of HAP emissions from 0.5 Mg/yr to 2.0 Mg/yr. A
subcategory based on 1 Mg of HAP emissions per year was selected for
the following reasons. First, facilities that emit less than 1 Mg of
emissions are likely to be area sources and therefore not subject to
the proposed standards, or are facilities that are represented by
relatively minimal, episodic emissions. For example, a typical river
barge holds 10,000 barrels or 420,000 gallons of gasoline. An
uncontrolled facility below a 1-Mg cutoff could be loading less than 30
barges per year. These facilities also typically emit less frequently
than facilities emitting more than 1 Mg/yr and typically only load a
single commodity. Additionally, these facilities also tend to load (and
therefore emit) commodities having lower vapor pressures than
commodities loaded at other, larger, facilities. Also, facilities that
emit 1 Mg or more of HAP emissions contribute approximately 98 percent
of HAP emissions to the national inventory. (See Docket A-90-44)
3. Determination of the MACT Floor
The MACT floors were determined for the following types of
operations: Product loading and ballasting.
a. Product loading. The marine vessel data base is based on
throughput data for marine vessel loading terminals. The throughput
data are divided into crude oil, gasoline, and 11 other commodity
categories. Additional information on these data are available in the
TSD for this proposed regulation (see ADDRESSES section of this
preamble). The EPA estimated the emissions of HAP from each of these
terminals using these throughput data and incorporating assumptions
about how many of these facilities were controlled, and the extent of
their control. These assumptions are based on existing Federal and
State regulations. For example, benzene loadings are already controlled
by the benzene NESHAP (40 CFR part 61, subpart BB). In addition, four
States have regulations requiring control of emissions from marine tank
vessel loading operations: New Jersey, Louisiana, Pennsylvania, and
California (District regulations). (Additional information on the
derivation of the MACT floor is found in Docket A-90-44, item II-A-44.)
Additional discussion of the Agency's interpretation of the MACT floor
is presented in section J. Solicitation of Comments.
Of the approximately 360 terminals estimated to be affected by the
proposed regulation, 43 facilities comprise the best performing 12
percent of facilities used in calculating the MACT floor for terminals
emitting over 1 Mg of HAP emissions. These terminals are subject to
State regulations in California, New Jersey, and Louisiana. Averaging
the required control levels of these facilities results in a MACT floor
of 93 percent control for facilities emitting more than 1 Mg of HAP per
year. Although this derived average does not precisely match a control
technology, for all practical purposes it is equivalent the emission
reduction achieved by recovery techniques (i.e., 95 percent).
Additional information on the derivation of the MACT floor may be found
in the docket for this proposed rulemaking effort.
There are approximately 1,440 facilities that would emit less than
1 Mg of HAP emissions annually if uncontrolled. The average control
level of the best performing 12 percent of facilities is 36 percent
control. This control level does not represent an existing technology.
Therefore using the average of the best performing 12 percent is
inappropriate for establishing the MACT floor. Taking the median of the
best performing 12 percent of these sources (94th percentile) results
in a control level of zero because the median facility is uncontrolled.
This is a more appropriate portrayal of the level of control that
exists in this subcategory. Therefore, this level of control (i.e., no
control) represents the MACT floor for terminals emitting less than 1
Mg/yr.
The MACT floor for new facilities, regardless of size, is a 98-
percent overall control of emissions. This control level represents the
best performing similar source. The Agency will take comment on whether
the MACT floor for new sources could, consistent with the requirements
of section 112(d) of the Act, be equal to a control requirement of 95
percent when a recovery device is used. As discussed elsewhere in this
preamble, the Agency wishes to encourage the use of recovery devices.
However, a 95 percent reduction requirement for recovery devices may be
considered inconsistent with the requirement of section 112(d)(3) of
the Act that emission standards for new sources shall not be less
stringent than the emission control achieved by the best controlled
similar source. The EPA requests comments on whether the secondary
benefits of recovery devices provide the Administrator with the ability
to determine that a 95 percent reduction requirement for those sources
using recovery is ``not less stringent'' than a 98 percent reduction
requirement for all other sources.
b. Ballasting. According to the Marine Board report, most tankships
have segregated or clean ballast tanks due to Coast Guard regulations
and international agreements that effectively prohibit ballast
emissions from occurring. Since the Marine Board report was issued in
1987, as older vessels have been retired, the proportion of
``uncontrolled'' vessels has decreased further. However, the Agency
does not have any information available to it to evaluate the
percentage of vessels that still emit ballasting emissions,
particularly those vessels that are not in crude oil service (where the
vast majority of ballasting occurs). The Administrator determined that
the MACT floor for ballasting at new or existing sources would be a
prohibition of ballasting emissions. The Agency is requesting comment
on this decision to prohibit ballasting emissions.

E. Selection of Basis and Level of Proposed MACT Standards

1. Development of Regulatory Alternatives
a. Product loading. Two regulatory alternatives were developed for
the subcategory represented by major source marine tank vessel loading
and unloading operations that emit less than or equal to 1 Mg of HAP
annually. The regulatory alternatives are summarized in Table 4. The
first alternative, Regulatory Alternative A, represents the MACT floor
of no control. Regulatory Alternative B represents the control of a
facility's total HAP throughput resulting in an overall emission
reduction of 95 percent.
Two regulatory alternatives were considered for the subcategory
represented by existing facilities emitting more than 1 Mg of HAP per
year. Regulatory Alternative A represents the MACT floor level of
control (93 percent overall control). Regulatory Alternative B
represents the control of a facility's total HAP throughput to an
overall control of 95 percent.
There are no regulatory alternatives for new facilities that exceed
the MACT floor of 98 percent control because no other alternatives that
are more stringent than the floor were considered technically feasible.

Table 4.--MACT Regulatory Alternatives^{a
----------------------------------------------------------------------------------------------------------------
HAP Incremental
Regulatory emissions Percent HAP No. of Capital Annual Cost cost
alternative reduction, emissions affected costs, $ costs, $ effectiveness, effectiveness,
Mg/yr limit terminals^{b million^{c million^{c $/Mg $/Mg
----------------------------------------------------------------------------------------------------------------
For facilities
emitting less
than or equal
to 1-Mg/yr
HAP:
A. No
control
(MACT
floor).... 0 0 0 0 0 0 N/A
B. 95
Percent
emission
limit..... 125 95 1,200 1,800 430 3,400,000 3,400,000
For facilities
emitting
greater than 1-
Mg/yr HAF^{d:
A. 93
Percent
emission
limit
(MACT
floor).... 1,300 93 240 570 130 99,000 N/A
B. 95
Percent
emission
limit..... 1,300 95 240 (^{e) (^{e) (^{e) (^{e)
----------------------------------------------------------------------------------------------------------------
^{aTerminals affected by State regulations or the benzene NESHAP are not included in these estimates.
^{b``Affected Terminals'' are terminals that would be required to control emissions.
^{cCosts are in 1990 dollars.
^{dTwenty-five facilities have HAP emissions greater than 1 Mg/yr and are affected by RACT. These facilities are
not included in these estimates.
^{eGiven the structure of the UTD cost estimates, distinctions between the costs at 93 percent and 95 percent
emission reduction were not possible. However, costs would be at least as high as those shown at the 93
percent emissions reduction plus additional retrofit costs for vessels. (Retrofit costs for vessels range from
$9,000 to $61,000.)

Source: Docket A-90-44, items II-A-23, II-A-32, and II-A-34.

b. Ballasting. There are no regulatory alternatives beyond the MACT
floor.
2. Impacts of the Regulatory Alternatives
The impacts of the product loading regulatory alternatives are
summarized in Tables 4 through 6.

Table 5.--Secondary Air and Energy Impacts of MACT Regulatory Alternatives^{ab
----------------------------------------------------------------------------------------------------------------
SOX NOX CO Electricity Natural gas
Regulatory alternative emissions, emissions,Mg/ emissions, impacts, impacts 1,000
Mg/yr^{c yr^{cK Mg/yr^{cK MWh/yr^{d ft^{3/yr^{d
----------------------------------------------------------------------------------------------------------------
For facilities emitting less than or equal
to 1-Mg/yr HAP:
A. No control (MACT floor)............ 0.0 0.0 0.0 0 0
B. 95 Percent emission limit.......... 0.5 28 27 114,000 12,000,000
For facilities emitting greater than 1-Mg/
yr HAP:
A. 93 Percent emission limit (MACT
floor)............................... 6.6 64 61 27,000 3,000,000
B. 95 Percent emission limit.......... 6.8 66 62 28,000 3,000,000
----------------------------------------------------------------------------------------------------------------
^{aTerminals affected by State regulations or the benzene NESHAP are not included in these estimates.
^{bBased on use of incineration.
^{cThese impacts represent increases in emissions; increases would not be expected if all sources used recovery
technologies.
^{dThese impacts represent increases in energy usage.

Source: Docket A-90-44, items II-A-24 and II-A-33.

Table 6.--Summary of Economic Impacts by MACT Regulatory Alternative^{a
--------------------------------------------------------------------------------------------------------------------------------------------------------
Terminals No. of
covered/ Maximum Percent terminals Displacement
Regulatory alternative throughout, Total cost, percent output Employ-ment under Impact on vessels potential by
(million ($MM) price reductions reductions competitive pipeline
bbl/yr) increase pressure
--------------------------------------------------------------------------------------------------------------------------------------------------------
For facilities emitting less
than or equal to 1-Mg/yr
HAP:
A. No control (MACT 0 0 0 0 0 0 None......................... None.
floor).
B. 95 Percent emission 1,200 1,800 (^{b) (^{b) (^{b) (^{b) (^{b).......................... (^{b)
limit. (320)
For facilities emitting
greater than 1-Mgy/r HAP^{c:
A. 93 Percent emission 240 570 0.09-0.54 0-0.04 166 230 High level of dedication; Minimal.
limit (MACT floor). (750) retrofitting of vessels.
B. 95 Percent emission 240 (^{d) (^{e) (^{e) (^{e) (^{e) (^{e).......................... (^{e)
limit. (750)
--------------------------------------------------------------------------------------------------------------------------------------------------------
^{aTerminals affected by State regulations or the benezene NESHAP are not included in these estimates.
^{bGiven the structure of the UTD data base, estimation of the impacts that would be anticipated at a control level more stringent than the MACT floor was
not possible. However, it is expected that these impacts would br more severe than those expected for facilities emitting more than 1 Mg/yr of HAP.
^{cTwenty-five facilities have HAP emission greater than 1 Mg/yr and are affected by RACT. These facilities are not included in these estimates.
^{dGiven the structure of the UTD cost estimates, distinctions between the costs at 93 percent and 95 percent emission reduction were not possible.
However, costs would be at least as high as those shown for the MACT floor plus additional vessel retrofit costs. (Vessel retrofit costs range from
$9,000 to $61,000.)
^{eGiven the structure of the UTD data base, distinctions between the impacts at 93 percent and 95 percent emission reduction were not possible. The
impacts for facilities emitting greater than 1 Mg/yr of HAP would be at least as high as the impacts shown for the MACT floor, with higher impacts on
vessels.

Source: Docket A-90-44, items II-A-23, II-A-32, and II-A-34.

3. MACT Determination
a. Product loading.--(1). Existing sources emitting 1 Mg/yr or
less. Under Regulatory Alternative B, the average cost effectiveness to
control existing facilities emitting less than 1 Mg/yr of HAP is
approximately $3.4 million per Mg. The Administrator has determined
that these costs are unreasonable and, as a result, that MACT for the
subcategory represented by existing facilities with emissions less than
or equal to 1 Mg per year of HAP emissions is equivalent to a MACT
floor of no control. This determination follows section 112(d) of the
Act where the Administrator is required to consider cost of achieving
emission reductions beyond the MACT floor (among other criteria) when
selecting MACT. These smaller facilities represent only 2 percent of
all industry-wide emissions.
(2). Existing sources emitting greater Than 1 Mg/yr. The
Administrator has determined that MACT for the subcategory represented
by existing facilities with HAP emissions exceeding 1 Mg per year is
the MACT floor of 93 percent overall control. The incremental benefits
of additional control are not justified considering the costs of
achieving these reductions.
The bulk of the incremental costs of control beyond the 93 percent
emission limit (MACT floor) are the costs to retrofit a sufficient
number of vessels to capture emissions beyond those required at the
MACT floor and supplemental operating costs. Unfortunately, the
Agency's marine vessel data base does not contain the type of data
needed to analyze the nationwide cost effectiveness of a more stringent
alternative. However, the average cost per facility to retrofit
sufficient vessels to allow the facility to comply with the incremental
emission reduction required for that facility to meet standards beyond
the MACT floor ranges from approximately $9,000 to $60,000 per year.
(Additional information on this analysis is found in Docket A-90-44,
item II-A-23 and item II-A-32). In addition, there may be substantial
additional costs to the facility to equip additional emission points
(e.g., berths) with emission control equipment. The Administrator deems
that any costs beyond the MACT floor, which itself has a cost
effectiveness of over $90,000 per Mg, would not be reasonable. (The
statute itself precludes the Administrator from selecting a less costly
MACT floor.) Based on this limited analysis, the Administrator has
elected to not require control beyond the MACT floor for this
subcategory.
The selection of 93 percent emission limit as MACT for existing
sources emitting greater than 1 Mg/yr should provide flexibility to
terminals that install control equipment that is expected to achieve 95
to 98 percent emissions reduction. This flexibility enables facilities
to control HAP emissions in the most efficient manner by not requiring
the control of liquids having minimal emissions. The Agency is
soliciting comment on the need for this flexibility, and on methods to
ensure enforceability of these standards given this flexibility.
It should be noted that the EPA does not believe that the analysis
performed above for MACT-regulated facilities is applicable to the
determination of RACT discussed in section III-C. The EPA believes that
the incremental benefits of controlling the MACT-regulated terminals
above 93 percent control is unjustified, given the costs already
associated with the MACT standard. On the other hand, the RACT
standards apply only to the largest crude oil and gasoline terminals in
the United States. The cost effectiveness associated with requiring 95
or 98 percent control at these facilities is considerably more
favorable than that associated with requiring 95 or 98 percent control
for the MACT-regulated facilities. As shown above, the cost
effectiveness associated with the RACT standard is $2,100/Mg,
considerably less than that for the MACT standard. Therefore, the
Agency believes that it is not appropriate to reduce the percent
reduction requirements of the RACT standard to match those of the MACT
standard. The EPA recognizes that for some individual facilities
regulated under both sections 112 and 183(f), the RACT standard may be
more stringent than the MACT standard. The EPA believes that this
result is appropriate, but the EPA is taking comment on this issue. The
EPA also notes that the control equipment required under both the MACT
standard and the RACT standard must meet the 95 or 98 percent control
threshold. The MACT standard offers flexibility with regard to the type
of liquids controlled, not the manner in which they are controlled.
(3). New sources. The Administrator has determined that MACT for
new facilities is the MACT floor, which is an overall control
requirement of 98 percent. However, as discussed above, the EPA will
take comment on whether MACT for new facilities could, consistent with
section 112(d) of the Act, be equal to 95 percent reduction for
recovery devices and 98 percent reduction for other destruction
devices.
b. Ballasting. The Administrator believes that the combined impact
of fleet turnover and Coast Guard and other regulatory requirements for
tankships to use segregated ballast tanks means that there should be no
impacts from the control (i.e., prohibition) of ballast emissions. As a
result, MACT was determined to be equivalent to a prohibition of
emissions from ballasting. However, as discussed in section J.2,
Ballasting Emissions, the Administrator is soliciting comments and data
on the possibility of significant impacts to currently uncontrolled
vessels.
4. Selection of the Proposed MACT Standards
a. Product loading. As with the RACT standards, vessels loading at
facilities with controls must install a vapor collection system and
pass one of three tank vessel tightness alternatives.
The MACT standards for existing facilities are based on a facility
demonstrating that 93 percent of HAP emissions are controlled.
Facilities would be allowed to demonstrate that the standard is being
met in one of two ways. In the first case, a facility may choose to
demonstrate that emissions from all vessels being loaded at the
facility are being routed to either a 95 percent efficient recovery
device or a 98 percent efficient destruction device. In the other case,
the facility may opt to exclude the emissions of certain vessels or
process lines from control, based on documented emission estimates, so
long as at least a 93 percent overall level of control is achieved. The
partial control of any commodity loaded or unloaded at the terminal
would not be allowed as a means of showing compliance with the 93
percent overall emissions reduction standard. The facility would still
be required to demonstrate that all controlled emissions are being
routed to either a 95 percent efficient recovery device or a 98 percent
efficient destruction device.
The MACT standards for new facilities require an emissions limit of
98 percent control. Additionally, these facilities would be required to
maintain tank-tight vessels while loading.
b. Ballasting. Owners or operators of existing and new marine tank
vessel loading and unloading operations would be required to
demonstrate compliance with the ballasting standards by maintaining
records showing that the vessels loaded met one of the following
criteria: (1) The vessel does not perform ballasting at any time, (2)
the vessel meets the Coast Guard standards, or (3) ballasting emissions
are ducted to a control device.
5. Impacts of the Proposed MACT Standards
The environmental, costs, energy and economic impacts of the
proposed MACT standards are summarized in Tables 4 through 6, and are
represented by Regulatory Alternative A for facilities emitting less
than or equal to 1 Mg of HAP and Regulatory Alternative A for
facilities emitting more than 1 Mg of HAP. There are no projected
impacts to controlling emissions from ballasting.
As discussed in section IV.C.5, the EPA believes that the potential
safety impacts of the standards have been addressed.
The estimated impacts of the standards are a VOC reduction of
12,400 Mg/yr of which 1,300 Mg are HAP. The capital and annualized
costs are estimated to be $570 million and $130 million, respectively.
The EPA performed an economic impact analysis of the MACT
determination for this regulation. Potential price, output, and
employment impacts for affected producers and for the marine transport
industry were examined for each alternative. Potential small business
impacts were also isolated. Additional information on these economic
impacts is available in the docket for this proposed regulation.
Estimated maximum price increases for the affected products varied
but were not large (less than 1 percent) for any of the products under
Regulatory Alternative A of the MACT determination for terminals
emitting more than 1 Mg/yr. These price increase estimates reflect both
the control cost increase for transporting crude oil and the control
cost increase for transporting petroleum products. Because these price
increases are small and because the elasticity of demand coefficients
for petroleum products are small, estimated percent output (i.e.,
throughput) reductions were minimal. Correspondingly, estimated
employment reductions were also small (less than 200).
Under Regulatory Alternative A of the MACT determination for
terminals emitting more than 1 Mg/yr, potentially significant economic
impacts on the smaller terminal operations that would have to install
controls were identified. These significant impacts may have resulted
from the high costs overall acting in combination with high per-barrel
control cost differentials between the smaller and larger terminal
operations that would have to control. It is expected that many of the
smaller terminal operations would not be able to pass all of their
control costs forward to consumers since they would be under increased
competitive pressure from the larger terminal operations. It was
estimated that up to 200 of the 264 affected terminal operations will
have difficulty either absorbing control costs or passing along these
costs to consumers under the proposed standard.
The potential economic impact on marine vessel owners is relatively
small. Average control cost per barrel for tankers shipping crude oil
or refined products was estimated to be $0.002 per barrel while owners
or barges shipping refined products would face control costs of $0.08
per barrel. Because 77 percent of U.S. marine-transported petroleum
product volume would be affected by these proposed standards, a
significant percentage of U.S. marine vessels will need to be
retrofitted. The vessels least costly to modify (most likely the
larger, newer, double-skin vessels) will be retrofitted first, leading
to a significant degree of dedicated service. It is expected that
vessel owners that do retrofit will be able to pass retrofit costs
forward to consumers.
As discussed above, a primary concern in the implementation of
these proposed regulations is safety. Though section 112 of the Act
does not specifically address U.S. Coast Guard regulations on safety,
the EPA has endeavored to make sure that safety factors are adequately
addressed and that nothing in the proposed regulations, whether
proposed under section 183(f) or 112, is inconsistent with current U.S.
Coast Guard regulations.
In addition, section 183(f)(2) of the Act requires that any
regulations promulgated by any State or political subdivision regarding
emissions from the loading and unloading of tank vessels must be
consistent with U.S. Coast Guard regulations regarding safety. This
consistency requirement is equally applicable to any State or local
regulation promulgated under the authority of the Clean Air Act section
112. Moreover, section 112(l) requires that the Administrator
disapprove any program submitted by a State if the Administrator
determines that the program is not likely to satisfy the objectives of
the Act. The EPA believes that any State or local program that is
inconsistent with U.S. Coast Guard safety regulations is ``not likely
to satisfy the objectives of the Act'' and would therefore be
disapproved by the Administrator.

F. Selection of Format for the Standards

The chosen format for the standards is a percent of mass emissions
reduction. The percent of mass reduction format allows a focus on the
final control device after good capture has been ensured. This approach
is consistent with the benzene NESHAP (40 CFR part 61 subpart BB).
Sufficient data to develop a mass per unit loaded standard were not
available. Additionally, emission rates can vary between facilities and
between vessels based on loading temperature and the arrival condition
of the vessel, making it difficult to set an acceptable mass per unit
loaded standard while ensuring good capture and control. Developing a
mass per unit loaded standard would have required extensive testing and
would need to be more stringent than the percent of mass reduction
format in order to accommodate the varying terminal and vessel
conditions. For this reason, a mass per unit loaded alternative is not
being proposed.
The primary format, mass emissions reduction, for the MACT
standards is the same as the RACT standards. However, because the MACT
standards allow the source the flexibility to control only the portion
of total facility emissions needed to meet the 93 percent reduction
requirement, facilities may choose to calculate both potential
uncontrolled and actual controlled emissions as part of the compliance
demonstration.
Emissions from ballasting operations would be prohibited.

G. Selection of Test Methods

The proposed standards require the use of approved test methods to
ensure consistent and verifiable results for initial performance tests
and compliance demonstrations.
Different test methods are specified for combustion and recovery
devices. For combustion devices, Method 25 of 40 CFR part 60, appendix
A (Method 25) has been specified. Method 25 is appropriate for
measuring the VOC destruction efficiency of combustion devices whose
output is greater than 50 ppmv. Given the large inlet concentrations
associated with marine loadings, outlet concentrations of less than 50
ppmv are not expected.
For recovery devices, (Method 25A) of 40 CFR part 60, appendix A
(Method 25A) has been specified. The (Method 25A) is appropriate for
measuring the VOC removal efficiency of a nondestructive control
device. Method 25A may be used for testing both removal efficiency and
outlet concentration.
Because emissions and control efficiency also vary during the
loading cycle, the EPA has determined that performance tests should be
conducted to include the loading of the last 20 percent of a
compartment, and may be spread out over multiple compartments. Data
show that the greatest emissions occur during the last 20 percent of
loading of a tank or compartment. The EPA believes that the control
equipment should be designed to handle the peak loading emissions,
which occur during this period.
The proposed standards also allow the use of any test method or
test results validated according to the protocol in Method 301 of 40
CFR part 63, appendix A to allow owners or operators greater
flexibility in testing.
Under today's proposed standards, owners or operators not having
documentation of vessel vapor tightness would be required to test the
vapor tightness of vessels using a pressure test provided in the
regulation, or a leak test provided in Method 21 of 40 CFR part 60,
appendix A. Methods are also provided for owners or operators loading
under negative pressure. These test methods were first proposed for
owners or operators of benzene transfer operations on September 14,
1989 (54 FR 38083) and were promulgated on March 7, 1990 (55 FR 8292).
In the proposal of the benzene transfer operations NESHAP, comments
were specifically requested regarding the suitability of these methods
for these sources. Based on the comments received on these methods and
the Agency's knowledge of the use of these methods under the benzene
transfer NESHAP, the Agency is confident that these methods are
suitable for determining vapor tightness for today's proposed
regulation.
Regarding the emission estimation procedures to be followed in
determining compliance with the proposed standards, the Agency is
proposing that facilities use either actual test data or AP-42
emissions factors to identify emissions from the various commodities
and streams loaded. The Agency is requesting comment on this approach
for estimating emissions.
H. Selection of Monitoring and Compliance and Performance Testing
Requirements
The proposed standards list parameters to be monitored for the
purpose of determining compliance. Monitoring requirements are proposed
for both the vapor collection system and control devices. The vapor
collection system monitoring requirements ensure that vent streams will
not be diverted from the control device through the use of flow
indicators or routine inspection of secured by-pass lines. While many
forms of monitoring may qualify as enhanced monitoring, enhanced
monitoring for tank vessel loading vapor control systems will generally
be limited to a continuous control device parameter monitoring system,
a continuous emissions monitoring system (CEMS), portable monitors, or
a combination thereof.
The monitoring criterion for carbon adsorption is a CEMS for VOC
concentration at the exhaust to atmosphere. The compliance condition
will be no exceedance of the average concentration demonstrated during
the facility's last compliance test. This monitoring criteria does not
correspond precisely to the 95 percent reduction requirement, however
it will be less costly to install and maintain than a system monitoring
inlet and outlet and calculating removal efficiency.
The monitoring parameter for combustion devices, except flares, is
combustion temperature. Combustion temperature is a strong indicator of
performance. The temperature to be maintained will be determined from
the facility's compliance test. For compliance purposes, temperature
variation is limited to 5.6 deg.C (10 deg.F)
compared to the average temperature during the most recent compliance
test.
The monitoring parameter for condensers is the exhaust stream
temperature. Exhaust temperature directly correlates to exhaust
concentration and is easier to monitor than outlet concentration.
Coolant temperature was not chosen because it provides no guarantee of
heat transfer efficiency or control efficiency. As with combustion
devices, temperature deviations from the operating parameters
established during the most recent compliance test are limited to
5.6 deg.C (10 deg.F).
The monitoring requirements for flares are established in 40 CFR
60.18, which requires the owner or operator to monitor for the presence
of a flame at all times.
The monitoring parameters for absorbers are the temperature and
specific gravity of the scrubbing liquid. Deviations from the operating
parameters established during the most recent compliance test are
limited to 11 deg.C (20 deg.F) above the baseline scrubbing liquid
temperature and 0.1 unit from the baseline scrubbing liquid
specific gravity respectively.
Finally, in order to not prohibit the use of other control devices
or new technology, a facility not using a control device for which
enhanced monitoring criteria have been included may develop its own
monitoring criteria and submit them to the Administrator for approval.
The Agency is also proposing alternative means of monitoring
compliance with the standards at terminals using recovery devices for
control of gasoline vapor emissions. These terminals would monitor the
outlet concentration of VOC from the recovery device. Compliance with
the standards is indicated provided that the VOC concentration is 1,000
ppmv or less. The EPA believes the 1,000 ppmv limit for gasoline vapor
is generally more strict than the 95-percent control device efficiency
requirement. Data from an existing facility show this limit to be
achievable (Docket A-90-44, item II-B-13). The intent of the
concentration alternative is to allow those facilities that operate at
a higher efficiency than required by the proposed standard to perform a
simpler compliance test, as they would only have to test at the outlet
of the control device. The EPA does not have sufficient data to
determine a ppmv emission limit for controlling VOC vapors from crude
oil emissions. Nor does the EPA have sufficient data to determine a
ppmv emission limit for controlling HAP vapors from crude oil emissions
or other commodities. The EPA is soliciting data and comments regarding
a ppmv limit for controlling non-gasoline VOC and HAP emissions and
whether carbon adsorption would be used to control emissions from crude
oil and other commodities.

I. Selection of Recordkeeping and Reporting Requirements

For enforcement purposes, it is necessary to require records and
reports of various parameters at all facilities. Two types of records
would be required to ensure compliance of facilities required to
install controls: (1) Monitoring results from the most recent
performance test and (2) results from periods when the measurement of
parameters significantly deviated from measurements of the same
parameters during the most recent performance test. Reports of those
periods when monitored parameters were significantly outside the
specified range would be submitted quarterly. These reports are
necessary to ensure that the control equipment is maintained in good
operating condition.
Additionally, owners or operators would be required to keep vapor
tightness documentation for marine vessels loaded on file in a
permanent form available for inspection. The owner or operator would be
required to update the vapor tightness documentation at least once per
year to ensure that only vapor tight marine vessels are loaded.
Owners or operators of affected facilities seeking to demonstrate
compliance with the 93 percent emission reduction standard must
maintain records of their determination of HAP control efficiency and
must submit quarterly reports of the source's HAP control efficiency
calculated from their actual throughputs. The Agency is soliciting
comment on these requirements. Specifically, the Agency requests
information on the type and method of documentation that should be
required to assure compliance with the 93 percent emission reduction
standard.

J. Solicitation of Comments

The Administrator specifically requests comments on the topics
discussed in this section. Commenters should provide available data and
rationale to support their comments on each topic.
1. Subcategories
The Agency has proposed to establish a subcategory for terminals
emitting less than 1 Mg/yr of HAP. The Agency is also requesting
comment on whether off-shore terminals and the Valdez Marine Terminal
should be placed in separate subcategories under section 112 of the
Act. The Agency requests comment regarding whether subcategories should
be established for other types of terminals based on particular
characteristics of these types of terminals of which the Agency
currently has no information. EPA also requests comments on whether
further subcategorization based on size is warranted.
a. Offshore terminals. The Agency does not believe that a facility
which is at least one-half mile offshore is part of a land-based
contiguous site. Offshore terminals (both those with subsea lines and
platforms) that are part of a contiguous terminal (i.e., offshore
terminals less than 1/2 mile from shore) present unique regulatory
challenges such as the cost and environmental impacts of installing
additional subsea lines to carry vapors to land-based equipment. Size
constraints, permitting difficulties, and other concerns may be issues
with an offshore control system. The EPA is proposing that offshore
terminals exceeding the throughput cutoffs and emission limits be
subject to the proposed regulations and control vapors to the same
extent as onshore facilities. The EPA is soliciting information and
comments regarding the feasibility and cost of controlling emissions
from offshore terminals. Comments are also requested on the grouping of
offshore facilities into a separate subcategory with different control
requirements under MACT.
b. Additional subcategory for the valdez marine terminal. On
December 29, 1993, the Alyeska Pipeline Service Company (``Alyeska'')
sent a letter to the Agency regarding this proposed rule (see Docket A-
90-44, item II-D- 65). In the letter, Alyeska discussed an alternative
regulatory approach that would allow the use of less stringent controls
at Alyeska's Alaska Valdez Marine Terminal (VMT). Alyeska ``believes
that the optimal vapor emission control system for the VMT is a system
that captures and recovers vapors from tanker loading, rather than one
that incinerates captured vapors.'' Alyeska believes that it can
successfully design a vapor recovery system for the VMT but intuitively
believes that the emission reduction that such a system can achieve
will be less than the percentage emissions reduction achieved by
significantly smaller systems and particularly those which address
emissions from refined petroleum products rather than crude oil.
Alyeska also believes that a vapor recovery system for the VMT is
unlikely to meet today's proposed requirements of a 95-percent emission
reduction of VOC and HAP for recovery devices under section 183(f) and
section 112, respectively. In addition, Alyeska states that the VMT
should be placed in a separate category or subcategory under section
112(d) because Alyeska believes the VMT is unique among U.S. marine
terminals.
Alyeska has also suggested separately (see Docket A-90- 44, item
II-D-71) that a recovery device may be available to VMT that could meet
a HAP emission reduction requirement approaching 93 percent but that
would likely not meet a VOC reduction requirement above 70 percent.
Alyeska suggests that as it is located in an ozone attainment area in
an extreme northern climate where formation of ozone is not a practical
concern, a lesser VOC reduction requirement may be reasonable under
section 183(f). The proposed format for the Section 112 emission limit
requires the VMT to reduce all the crude emissions by 95 percent when
using a recovery device. The EPA requests comments on whether this
format could be changed to allow for a 93-percent reduction of
emissions for less efficient control technologies.
The EPA made no changes to the proposed standard in response to
Alyeska's letter. However, the EPA is seeking public comment on the
issues addressed by Alyeska. In addition, Alyeska intends to provide
the EPA with further documentation supporting its position before the
end of the public comment period. The EPA will consider this new
information in addition to currently available information in deciding
the final standard. Currently available information which will be
considered is described in the following paragraphs.
Section 183(f) requires the application of RACT considering
``costs, any non-air quality benefits, environmental impacts, energy
requirements and safety factors associated with alternative control
techniques.'' Section 112(d) requires the application of MACT
considering the ``cost of achieving such emission reduction, and any
non-air quality health and environmental impacts and energy
requirements.'' (In addition, as described previously, a minimum
control level is specified, referred to as the floor.)
Section 112(c) requires the EPA to establish categories and
subcategories of sources for regulation under section 112(d). In the
EPA's notice of initial list of categories, the EPA stated that ``a
category of sources is a group of sources having some common features
suggesting that they should be regulated in the same way and on the
same schedule.'' (57 FR 31578, July 16, 1992). The EPA also noted that
``criteria that may need to be considered in defining categories of
similar sources include similarities in: process operations (including
differences between batch and continuous operations), emissions
characteristics, control device applicability and costs, safety and
opportunities for pollution prevention'' (57 FR 31580). To justify VMT
being placed in a separate category or subcategory, it needs to be
shown that VMT has distinctions that are relevant from a regulatory
standpoint (given the restrictions of section 112), in determining
whether the VMT can be regulated in a similar manner as other
terminals.
The VMT is the largest crude oil loading facility in the U.S. with
hourly crude loading rates more than 15 times that of any other marine
terminal. The VMT is one of only a few terminals which are exclusively
used for crude oil loading.
Alyeska has acknowledged that it could use a combustion device at
VMT to achieve a 98 percent reduction in emissions. However, Alyeska
has raised concerns about the feasibility of recovering crude oil
vapors with a 95 percent efficiency using conventional recovery devices
such as carbon adsorbers.
According to Alyeska the design and construction of a vapor
recovery system for the VMT would be technically more complicated than
for any other marine terminal. This is because no existing vapor
recovery system is currently operating on as large a vapor stream as
the VMT terminal, there is great complexity in recovering crude oil
vapor (as opposed to petroleum product vapor), and for reasons
discussed in the following paragraph, a VMT recovery system would have
to be designed to operate efficiently over a broad range of declining
input volumes. In addition, the sub-Arctic climate of the region
presents unique problems with regard to handling water vapor in terms
of both complications on the technical processes by which crude oil
vapors can be recovered and in terms of monitoring accuracy. Different
and more complex operating parameters must be considered in the design
and construction of a vapor recovery system that will operate
effectively on the VMT crude oil stream because the number and range of
volatility of the hydrocarbon components are greater in a crude oil
stream than in a product stream. Alyeska believes that it may not be
possible to achieve as high a recovery from a crude oil vapor stream as
is achievable from a product vapor stream because of this difference in
the number and range of volatility of the hydrocarbon components.
The throughput in the Trans-Alaskan Pipeline (TAP), which supplies
the crude for loading at the VMT, is expected to decline such that the
volume of vapors that must be handled by the VMT recovery system will
decrease with time. In 1988 annual TAP throughput reached a peak of
2.14 million barrels per day. Throughput subsequently has declined to a
current level of 1.62 million barrels per day (average year to date for
1993) and estimates indicate that production will continue to decline
over the life of the now declining North Slope oil fields. An emission
control system designed for the VMT needs to be able to operate
efficiently over a broad range of declining input volumes. When
considering declining throughput, a recovery system enables more design
flexibility than an incineration system because recovery systems
require enough contact with either surface area or scrubbing liquid to
ensure high recovery; as flow decreases contact increases which
marginally increases recovery. Therefore, a facility may design very
large control units or smaller parallel units, both of which will
function at design efficiency. An incinerator is not as flexible in
operation as a recovery system. An incinerator requires proper mixing
of the waste stream and the flame and mixing becomes poorer as flow
rates decline. Large incinerators cannot be run at flow rates much
lower than one half design rates without affecting mixing and
corresponding combustion efficiency.
In addition the VMT will require the use of ``active'' detonation
arrestors instead of ``passive'' detonation arrestors used at other
marine terminals, due to the amount of vapors that must be collected
and the distance between the vessel loading berths and vapor recovery
facilities. Alyeska has developed active detonator arrestors that have
been approved by the Coast Guard, because passive detonation arrestors
would not protect a VMT type system from explosion.
Alyeska estimated that the additional amount of energy that could
be conserved by recovering (instead of incinerating) tanker vapors at
the VMT would be as great or greater than the energy that could be
saved by recovering tanker vapors at all other U.S. crude oil loading
marine terminals combined (about 250,000 barrels at current
throughput). Both recovery and incineration result in other air
pollutants including particulate matter (PM), sulfur oxides (SOX),
nitrogen oxides (NOX), carbon monoxide (CO), and carbon dioxide
(CO2). Vapor recovery may be more advantageous when considering
the overall contribution of all pollutants to the environment.
The proposed standard does not treat a facility such as the VMT as
a separate category or subcategory. However, the EPA is still
considering whether these characteristics described above are
sufficient to warrant treatment of a facility like the VMT as a
separate subcategory, and is requesting additional information and
public comments on this issue. Comment is also requested on the extent
to which these factors, largely related to recovery devices, should be
considered if such a facility can use an incinerator. Additional
information is sought on the extent to which factors such as a
different detonator device are relevant to the decision. The EPA also
invites comment on Alyeska's suggestion that a VOC reduction
requirement less stringent than 95 percent is appropriate for a
terminal in an ozone attainment area in an extreme northern climate
where ozone formation is not a practical concern. The EPA will evaluate
all information and comments submitted in making a final determination
before promulgation of the standard.
Alyeska states that diminishing throughput could eliminate the need
for control equipment at all berths in the future; if throughput
continues to decline, the VMT will eventually be able to handle the
entire throughput at only two berths instead of the four available
berths. Alyeska has raised an issue concerning the need to control the
berths normally not in use if they are used for ``emergency purposes.''
The issue is independent of the choice of control systems and would not
be considered in a determination of whether it is appropriate to put
the VMT in a separate subcategory. However, the EPA may evaluate a
regulatory approach which requires full control of emissions at the
primary loading berths, but allows occasional use of uncontrolled
berths. This type of regulatory scenario assumes that emissions from
the uncontrolled berths would be negligible when compared to emissions
to the controlled berths. For the EPA to evaluate such an approach
requires VMT to provide detailed information on the impacts and
tradeoffs for various scenarios of the controlled versus uncontrolled
berths. The EPA is requesting comments on this type of approach,
including the need to limit frequency of use or mass emissions, and the
details that should be in the rule to ensure compliance.
If facilities with characteristics like the VMT were in a separate
subcategory, the MACT floor would appear to be no control. The EPA
would consider requiring control levels more stringent than the MACT
floor. The tradeoffs between incineration and vapor recovery would be
considered in this determination, and also in the determination of RACT
under section 183(f). The declining throughput and its affect on the
number of berths would also be considered in this decision.
Alyeska is still studying the total impacts associated with vapor
recovery systems. Currently, Alyeska has not yet provided the EPA with
the control efficiency of the recovery process, the energy
requirements, costs, or the secondary pollutants associated with
recovery; nor has Alyeska provided evidence showing that a 93 or 95
percent reduction in emissions of HAP using a recovery device is
infeasible at VMT. Moreover, given that the EPA's definition of VOC
does not include methane and ethane, there is some question as to
whether a 95 percent reduction in VOC is in fact possible using
recovery at the VMT. Additional information is also needed on the
declining throughput, its effect on the number of berths controlled,
and the tradeoffs involved. The EPA could possibly consider the trade-
offs among HAP, VOC, PM, SOX, NOX, CO and CO2 in
addition to energy savings when evaluating recovery versus
incineration. The EPA invites comment on whether a regulatory approach
that would allow the use of a less stringent vapor recovery system at
the VMT is permissible and appropriate under the Act. Such comments
should include the consideration of tradeoffs between HAP, other
pollutants, energy, and whether consideration of such tradeoffs is
permissible under sections 112 and 183(f). Before promulgating a final
rule, the EPA will evaluate all additional information, data, and
comments submitted. Based on this evaluation, the promulgated standards
could be set at the proposed RACT and MACT levels, but the EPA will
examine all information relevant to including a separate subcategory
for large crude terminals and establishing a different MACT level for
each subcategory.
2. Ballasting Emissions
In preparing today's proposed rule the Agency has assumed that the
prohibition of ballasting emissions does not contain any impacts for
industry because of the U.S. Coast Guard regulations requiring
segregated ballasting tanks. The Administrator is soliciting comments
and data that might indicate that there are potential impacts to
certain classes of vessels, particularly those carrying noncrude oil
product. In addition, the Administrator encourages comment on how a
prohibition of ballasting emissions could be implemented most
effectively.
3. Alternative Concentration-Based Compliance Determination
For terminals that use recovery devices for control of gasoline VOC
and/or HAP emissions, the EPA is proposing an alternative means of
compliance to the proposed standards. The EPA is soliciting data and
comments regarding a ppmv limit for controlling non-gasoline VOC and
HAP emissions and whether carbon adsorption would be used to control
emissions from crude oil and other commodities.
4. Vessel Tightness Testing
The proposed standards require vessels to undergo one of three
tightness tests at least every 12 months. The Administrator is
soliciting data on the frequency of leaks on marine vessels to
determine whether the interval between tests is appropriate. The
Administrator is also requesting data on the effectiveness of requiring
vessels to undergo one of these three tightness tests.
5. Procedures to Estimate HAP Emissions
The TSD describes the limited data regarding marine vessel loading
emission factors available to the Administrator to use in estimating
HAP (or VOC) emissions from marine vessel loading operations. While
these data are sufficient to estimate emissions as part of regulatory
impact analyses, they may not be sufficient for the Administrator to
require the use of specific emission factors in the emission estimation
alternative allowed under the proposed part 63 standards for existing
sources. For this reason, facilities wanting to take advantage of this
alternative will develop and submit documentation of emission estimates
on a case-by-case basis. The Administrator requests that commenters
submit data on possible emission factors and/or alternative emission
estimation procedures for consideration in the final rule.
6. RACT Standard of 93 Percent Reduction
As discussed above, for those sources regulated under section
183(f) of the Act, the EPA is requiring that such sources reduce
emissions at their facility overall by 95 percent if using a recovery
device or by 98 percent if using a destruction device. Nevertheless,
the Agency specifically decided not to increase the stringency of its
MACT standard, for those existing sources regulated under section 112,
beyond a reduction level of 93 percent because the cost effectiveness
level of such an increase would not be reasonable.
The Agency believes that it is reasonable, given the associated
cost effectiveness values, to require the facilities regulated under
section 183(f) (the largest terminals of their kind in the U.S.) to
reduce emissions by 95 or 98 percent, despite the fact that the Agency
is requiring only 93 percent reduction for the terminals regulated
under section 112. However, the EPA understands that it is unusual for
a RACT standard for any single source to be more stringent than a MACT
standard for that source, as it may be for certain sources regulated
under both sections 112 and 183(f).
The Agency requests comment on whether the analysis performed for
regulation of sources under the MACT standard of section 112 is equally
valid under the RACT standard of section 183(f). That is, given the
cost effectiveness values associated with decreasing the stringency of
the RACT standard from 95 or 98 percent control to 93 percent control,
would it be reasonable, ``considering costs, any nonair-quality
benefits, environmental impacts, energy requirements and safety
factors,'' for the Agency to promulgate a standard of 93 percent
control for those sources regulated under section 183(f), in addition
to those sources regulated solely under section 112?
7. Carbon Bed Regeneration Emissions
In the proposed regulation, the Agency is prohibiting HAP emissions
from the regeneration of a carbon bed when a carbon bed adsorber is
used to control HAP emissions. The Agency is requesting comment on this
requirement.
Specifically, the Agency requests comment on the degree to which
steam stripping (in which steam is used to regenerate these carbon
beds) is used at affected sources.
8. MACT Floor Determination
In a March 9, 1994, Federal Register notice reopening the public
comment period for determination of ``MACT floor'' for NESHAP source
categories (59 FR 11018), the Agency considered more than one
interpretation of the statutory language concerning the MACT floor for
existing sources and solicited comment on them. The MACT floor decision
that the EPA will make on the basis of this March 9, 1994, notice will
have broad precedential effects, and will presumptively be followed by
the Agency in any rulemakings subsequently promulgated under Title III
of the Act. The MACT floor determinations proposed in today's
rulemaking may therefore be affected by the Agency's final
interpretation of ``MACT floor.''
Sections 112(d)(3) (A) and (B) of the Act require that the EPA set
standards no less stringent than ``the average emission limitation
achieved by the best performing 12 percent of the existing sources'' if
there are at least 30 sources in a category, or ``the average emission
limitation achieved by the best performing 5 sources'' if there are
fewer than 30 sources in a category. During the development of this
proposed rule, the EPA considered two interpretations of this statutory
language. One interpretation groups the words ``average emission
limitation achieved by'' together in a single phrase and asks what is
the ``average emission limitation achieved by'' the best performing 12
percent. This interpretation places the emphasis on ``average.'' It
would correspond to first identifying the best performing 12 percent of
the existing sources, then determining the average emission limitation
achieved by these sources as a group. Another interpretation groups the
words ``average emission limitation'' into a single phrase and asks
what ``average emission limitation'' is ``achieved by'' all members of
the best performing 12 percent. In this case, the ``average emission
limitation'' might be interpreted as the average reduction across the
HAP emitted by an emission point over time. Under this interpretation,
the EPA would look at the average emission limits achieved by each of
the best performing 12 percent of existing sources, and take the
lowest. This interpretation would correspond to the level of control
achieved by the source at the 88th percentile if all sources were
ranked from the most controlled (100th percentile) to the least
controlled (1st percentile). For today's proposed regulation, the
Administrator is using the first interpretation described above, which
interprets the statutory language to mean that the MACT floor for
existing sources should be set at the level of control achieved by the
``average'' of the best performing 12 percent.
In establishing the MACT floor for today's proposed regulations,
the EPA also considered two possible meanings for the word ``average''
as the term is used in section 112(d)(3) (A) and (B) of the Act. First,
the EPA considered interpreting ``average'' as the arithmetic mean. The
arithmetic mean of a set of measurements is the sum of the measurements
divided by the number of measurements in the set. The EPA determined
that the arithmetic mean of the emissions limitations achieved by the
best performing 12 percent of existing sources in some cases would
yield an emission limitation that fails to correspond to the limitation
achieved by any particular technology. In cases where this limitation
existed, the EPA decided not to select this approach. The EPA also
considered interpreting ``average'' as the median emission limitation
value. The median is the value in a set of measurements below and above
which there are an equal number of values (when the measurements are
arranged in order of magnitude).
For the subcategory of sources emitting 1 Mg/yr or more of HAP, the
Agency determined that the derived arithmetic mean, for all practical
purposes, is equivalent to recovery technologies and thus the Agency
used the mean to determine the MACT floor for this subcategory. The EPA
selected the median for the subcategory of sources emitting less than 1
Mg/yr of HAP because the arithmetic mean yields a value that does not
correspond to a particular emission control technology.
The EPA solicits comment on its interpretation of ``the average
emission limitation achieved by the best performing 12 percent of the
existing sources'' (section 112(d)(3)(A) of the Act) and its
methodology for determining the MACT floor.
9. Monitoring Parameters
The proposed standard requires that terminals using a combustion
device to comply with the standard monitor the combustion temperature
computed every hour as an hourly average, and every third hour as a 3-
hour block average. Operation of the affected source in deviation of
the baseline temperature developed during the compliance test in excess
of 5.6 deg.C (10 deg.F) constitutes noncompliance with the standard.
The baseline temperature is averaged over the loading cycle. The Agency
believes that it is appropriate to average temperatures measured during
the compliance test to establish a baseline temperature to which
monitored data can be compared. The Agency is soliciting comments on
the effect of the proposed averaging times on the parameter's
effectiveness in ensuring compliance with the proposed standards.

IV. Administrative Requirements

A. Public Hearing

The EPA will hold a public hearing to discuss the proposed standard
in accordance with section 307(d)(5) of the amended Act. Persons
wishing to make oral presentation on the proposed standards for marine
tank vessel loading operations should contact the EPA at the address
given in the ADDRESSES section of this preamble. The EPA will limit
oral presentations to 15 minutes each. Any member of the public may
file a written statement before, during, or within 30 days after the
hearing. Send written statements to the Air Docket Section address
given in the ADDRESSES section of this preamble and should refer to
Docket A-90-44.
The EPA will make a verbatim transcript of the hearing and written
statements available for public inspection and copying during normal
working hours at the EPA's Air Docket Section in Washington, DC (see
ADDRESSES section of this preamble).

B. Docket

The docket is an organized and complete file of all of the
information submitted to or otherwise considered by the EPA in the
development of this proposed rulemaking. The principal purposes of the
docket are (1) to allow interested parties to readily identify and
locate documents so that they can intelligently and effectively
participate in the rulemaking process and (2) to serve as the record in
case of judicial review (except for interagency review materials)
(section 307(d)(7)(A) of the amended Act).

C. Office of Management and Budget Reviews

1. Paperwork Reduction Act
The information collection requirements in this proposed standard
have been submitted for approval to the Office of Management and Budget
(OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. An
Information Collection Request (ICR) document has been prepared by the
EPA (ICR No. 1679.01), and interested parties may obtain a copy from
Sandy Farmer, Information Policy Branch, EPA, 401 M Street, SW. (2136),
Washington, DC 20460, or by calling (202) 260-2740. The public
reporting burden for this collection of information is estimated to
average 265 hours per respondent per year, including time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collection of information.
Send comments regarding the burden estimate or any other aspect of
this collection of information, including suggestions for reducing this
burden, to Chief, Information Policy Branch, 2136, U.S. Environmental
Protection Agency, 401 M Street, SW., Washington, DC 20460, and to the
Office of Information and Regulatory Affairs, Office of Management and
Budget, Washington, DC 20503, marked ``Attention: Desk Officer for the
EPA.'' The final standard will respond to any OMB or public comments on
the information collection requirements contained in this proposal.
2. Executive Order (E.O.) 12866 Review
Under Executive Order 12866, (58 FR 51735 (October 4, 1993)) the
Agency must determine whether the regulatory action is ``significant''
and therefore subject to OMB review and the requirements of the
Executive Order. The Order defines ``significant regulatory action'' as
one that is likely to result in a rule that may:
(1) Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a section of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities;
(2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
Pursuant to the terms of Executive Order 12866, it has been
determined that this rule is a ``significant regulatory action''
because an annual effect on the economy of $100 million or more is
anticipated. As such, this action was submitted to OMB for review.
Changes made in response to OMB suggestions or recommendations will be
documented in the public record.

D. Regulatory Flexibility Act Compliance

The Regulatory Flexibility Act (Pub. L. 96-354, September 19, 1980)
requires consideration of the impacts of regulations on small entities,
which are small businesses, small organizations, and small governments.
The major purpose of this Act is to ensure consideration of regulatory
alternatives that might mitigate adverse economic impacts on small
entities. If a preliminary analysis indicates that a proposed
regulation is likely to have a significant economic impact on a
substantial number of small entities, a regulatory flexibility analysis
must be performed to examine alternatives that might lessen such
effects.
The EPA performed an economic impact analysis of the MACT
determination considered for this regulation, which included a
preliminary assessment of the potential adverse impacts on small
entities. Two types of businesses were identified that could incur
adverse small business impacts: marine terminal operations and marine
vessel operations.
With regard to marine terminal operations, the proposed standards
exempt facilities with HAP emissions of less than 1 Mg/yr. This reduces
the number of impacted terminals from approximately 1,450 to 264. These
exemptions allow the smallest operations to avoid installation of
controls. These exemptions greatly reduce per-barrel control cost
differentials that, as indicated in the economic impact analysis, would
make it difficult for owners of the smallest terminals to pass forward
control costs to consumers had no or fewer exemptions been made. With
the proposed standards, however, it is expected that a large portion
(up to 200) of the 264 regulated terminals will only be able to pass a
fraction of the control costs on to consumers in the form of higher
prices. This condition is attributable to the EPA's assumption that
loading costs will increase by the average cost of control, that
terminals are competitive and that higher than average control cost
terminals will have to absorb those differences. Thus, the economic
impact on these terminal owners is expected to be significant because
of the impact of cost absorption on profitability and/or difficulty in
raising capital for the control system. On the other hand, of those 200
terminals, it is expected that many are part of large integrated
petroleum operations, have easier access to capital and will remain
open. Some with higher than average control costs will also be in a
position to raise their prices as much as their control costs because
of favorable locations or other market conditions. However, the overall
number of small business terminal operations significantly affected by
this regulation is expected to be substantial.
With regard to marine vessel operations, the economic impact
analysis considered all of these operations to be small businesses. The
number of vessel operations estimated to be impacted by the proposed
standards is expected to be substantial since a significant percentage
of the petroleum products transported via marine vessels will be
affected by the standards. Excluding volume from the three large crude
oil terminals affected (these terminals are served by large oil tankers
with insignificant estimated retrofit costs ($0.002/bbl), 77 percent of
the U.S. marine transported throughput of controlled products and crude
oil will be affected by the standards. That same volume percentage of
the fleet marine vessels will need to be retrofitted to service
regulated terminals. It is expected, however, that many of these vessel
owners will be able to pass forward retrofit costs in the form of
higher transport prices.
The Agency has therefore judged that a significant economic impact
on a substantial number of small entities (namely terminals) will
likely result from the proposed standards and that a regulatory
flexibility analysis should be performed.

List of Subjects in 40 CFR Part 63

Environmental protection, Air pollution control, Intergovernmental
relations, Reporting and recordkeeping requirements, Tank vessel
standards.

Statutory Authority

The statutory authority for this proposal is provided by sections
101, 112, 114, 116, 183(f) and 301 Clean Air Act, as amended; 42 U.S.C.
7401, 7411, 7414, 7416, 7511b(f), and 7601.

Dated: April 29, 1994.
Carol M. Browner,
Administrator.
[FR Doc. 94-10974 Filed 5-12-94; 8:45 am]
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