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Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Rules and Regulations within that source category under CAA
section 111b i.e., via a NSPS.
If the EPA were to evaluate the trend in the number of designated facilities and emissions of a source category, it might show a static number of existing facilities with a constant or slightly increasing quantity of the U.S. GHG
emissions. In this scenario, there may be little utility in determining significance for that source category and consequentially developing a NSPS as there are little to no emissions that would be subject to such a standard.
However, creating a NSPS for a source category and pollutant is a necessary predicate to regulating existing sources under CAA section 111d. Hence, in the scenario of a static number of existing facilities, a finding of significance for the source category may be warranted as it would allow eventual regulation of a group of existing source categories.
Under this framework, the EPA expects the prospect of regulating a source category under CAA section 111d for existing sources to be a compelling reason for determining significance.
b. Source Category Emissions With Global Context Another important criterion that the EPA considers, as a secondary factor, is the relative contribution of GHG
emissions from the U.S. in a specific source category compared to worldwide emissions of similar sources. As previously described, Section 111b1A of the CAA states that the Administrator shall include source categories that contribute significantly to endangerment of health and welfare.
When evaluating a global pollutant such as GHGs, the EPA views the impact of domestic emissions from domestic sources as a more germane consideration when determining whether a pollutant contributes significantly to endangerment of health or welfare. Because every ton of GHG
contributes to the global problem, a domestic ton will still have some impact in the U.S. Accordingly, it is reasonable for the EPA to evaluate whether a source category is well-regulated internationally and whether the U.S.
emissions from that sector make up a relatively large share of GHG emissions on a worldwide scale, as such evaluation in turn would inform whether U.S. emissions are significantly contributing to domestic impacts. If the emissions from the U.S. are comparatively a large contribution to source category/sector emissions worldwide, it may lend towards a finding of significance for the source category based on the U.S.s substantial global contribution to the source
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category. If, however they are relatively small, it would suggest less benefit from the EPA regulation of that source category.
The EPA also considers, as one of the secondary criteria, an evaluation of whether a source category is vulnerable to being trade exposed i.e. whether the source category is constrained in the sources ability to pass through carbon costs due to actual or potential international competition. The EPA
evaluates whether regulation of the source category would create a financial incentive for that source category/
industry to move into, or increase production in, another country. This could be manifested as either a shift in production to facilities internationally or a complete closure of existing designated facilities in the U.S. It is not the EPAs intention in regulating source categories to drive production from the U.S. to other countries, and there is an environmental concern in pushing industries to other international locations. This concern is based on the potential for these new international emissions to increase compared to the corresponding displaced U.S.
emissions.15 While this is always a concern for the EPA in the regulation of industry within the U.S., it even more pronounced with the consideration of GHG emissions. As discussed, previously, the U.S. GHG emissions are a global pollutant that also have domestic impacts. As such, if a smaller quantity of domestic GHG emissions would be displaced, due to a regulation, by a greater quantity of international GHG emissions it may support a finding of insignificance for a given source category. This would occur if the U.S.
sources are already significantly lower emitting in GHG emissions than sources in other countries. It should also be noted that source categories whose sources in the U.S. make up a relatively smaller proportion of the worlds emissions from corresponding international sectors may be particularly vulnerable to being trade exposed as there is likely a greater international capacity to absorb the displaced U.S.
production.
Given the global nature of GHG
emissions, assessing and understanding the estimated potential net emissions impact of GHG control technologies provides useful context in which to consider the significance of a given set 15 If
U.S. production shifted overseas to a jurisdiction that has laxer environmental regulations, for a global pollutant such as mercury or GHGs, there could be both increased local environmental and health impacts at the new overseas location and domestic impacts to the U.S.
resulting from the increased U.S. GHG emissions.

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of GHG emissions In addition, there may also be value in evaluating and considering the technology with the associated source category i.e., intrinsic to the process of the source category a prime example of reductions associated with this evaluation might be assessing the likely impacts of efficiency improvements. From a public welfare and human health perspective, targeting source categories that provide the largest overall possible scope for emissions reductions could be an intrinsic part of determining the significance of a given magnitude of emissions. Thus, the EPA is determining that it is appropriate in a given instance to consider feasible technologies including efficiency improvements for further context in the Agencys determination of significance of a source categorys overall emissions. Here, the magnitude of GHG emissions from EGUs coupled with the reductions available through efficiency improvements supports the EPAs determination of significance.
d. Temporal Evaluation of Criteria As introduced in this framework, the evaluation of the secondary criteria is not intended to be performed in isolation. Rather, the EPA considers the weight of evidence of all the factors both primary and secondary to make an informed and comprehensive decision as to whether a source category that exceeds the 3-percent threshold contributes significantly to the U.S.
GHG emissions. The consideration of criteria also has a temporal consideration to a significance determination. A source categorys determination can be reevaluated in the future as the status and criteria described here may have changed for that source category. For example, the technology to adequately regulate GHGs from a source category may not be readily available at this time, but in the future that technology may become more broadly available causing the EPA
to then make a SCF.
E. Significant Contribution Finding for EGUs As noted above, the Agency is finalizing a determination that GHG
emissions from EGUs 16 contribute significantly to dangerous air pollution.
The primary criterion in determining 16 For this purpose, EGUs include the affected sources in the combined source category for boilers and turbines. In the 2015 Rule, the EPA
combined the two categories of EGUssteam generators and combustion turbinesinto a single category of fossil fuel-fired EGUs for purposes of promulgating standards of performance for CO2
emissions. 80 FR 64529 2015 Rule.

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