(a) For manufacturers selling non-locomotive-specific engines to be used as propulsion engines in remanufactured locomotives, such locomotives and engines are exempt, provided:

(1) The engines are covered by a certificate of conformity issued under 40 CFR part 89;

(2) More engines are reasonably projected to be sold and used under the certificate for non-locomotive use than for use in locomotives;

(3) The number of such engines exempted under this paragraph (a) does not exceed:

(i) 50 per manufacturer in any calendar year, where EPA determines that the use of the non-locomotive-specific engines will result in a significantly greater degree of emission control over the lifetime of the locomotive than using remanufactured engines certified under this part 92; or

(ii) 25 per manufacturer in any calendar year, where EPA has not determined that the use of the non-locomotive-specific engines will result in a significantly greater degree of emission control over the lifetime of the locomotive than using remanufactured engines certified under this part 92;

(4) The Administrator has approved the exemption as specified in paragraph (e) of this section.

(b) For manufacturers of freshly manufactured switch locomotives powered by non-locomotive-specific engines, such freshly manufactured switch locomotives are exempt, provided:

(1) The engines are covered by a certificate of conformity issued under 40 CFR part 89;

(2) More engines are reasonably projected to be sold and used under the certificate for non-locomotive use than for use in locomotives;

(3) The number of such locomotives sold or leased by the locomotive manufacturer within any three-year period, and exempted under this paragraph (b) does not exceed 30; and

(4) The Administrator has approved the exemption as specified in paragraph (e) of this section.

(c)

(1) The remanufacture of locomotive engines that have been exempted under this section is exempt without request provided that the remanufacturer remanufactures them to a previously-certified configuration, or to be equivalent to engines that have been previously certified under this part or 40 CFR part 89.

(2) The remanufacture of non-locomotive-specific engines that were used in locomotives prior to January 1, 2000 is exempt from the requirements of this part provided: The remanufacturer remanufactures them to be equivalent to engines that have been previously certified under this part or 40 CFR part 89, or demonstrates that the NOX emissions from the remanufactured locomotive engine are at least 40 percent less than its emissions prior to certification; and the Administrator has approved the exemption as specified in paragraph (e) of this section.

(d) Manufacturers and remanufacturers of engines and/or locomotives exempted under this section shall:

(1) Report annually to EPA the number of engines exempted under paragraph (a) of this section;

(2) Report annually to EPA the number of locomotives exempted under paragraph (b) of this section; and

(3) Upon the Administrator's request, provide test data showing the emissions of the engine or locomotive when it is operated at the actual in-use locomotive power points.

(e)

(1) Manufacturers and remanufacturers seeking an exemption under this section shall notify the Administrator of such intent at least 90 days prior to selling or placing into service the locomotives or locomotive engines.

(2) The Administrator shall deny a non-locomotive-specific exemption in any case where he/she has evidence that approving such an exemption would be inappropriate because of adverse environmental or economic impacts.

(3) When denying an exemption, the Administrator shall notify the manufacturer or remanufacturer of EPA's decision to deny or consider denying the exemption within 60 days of the manufacturer's or remanufacturer's notification in paragraph (e)(1) of this section.

(4) Unless the Administrator notifies the manufacturer or remanufacturer of EPA's decision to deny or consider denying the exemption within 60 days of the manufacturer's or remanufacturer's notification in paragraph (e)(1) of this section, the exemption shall be considered approved 90 days of the manufacturer's or remanufacturer's notification.

[63 FR 18998, Apr. 16, 1998, as amended at 70 FR 40457, July 13, 2005]