The provisions of this section apply for vessels operating exclusively in the Great Lakes.

(a) Notwithstanding other provisions of this part, the requirements of this part do not apply for vessels propelled by steam turbine engines or reciprocating steam engines (also known as steamships), provided they were propelled by steam engines and operated within the Great Lakes before October 30, 2009 and continue to operate exclusively within the Great Lakes.

(b) The fuel-use requirements of this part do not apply through December 31, 2025, for a ship qualifying under paragraph (a) of this section if it was in service as a steamship on October 30, 2009 and it is repowered with one or more marine diesel engines, subject to the following conditions and requirements:

(1) Engines must meet exhaust emission standards using one of the following approaches:

(i) All the installed replacement engines must be certified to applicable standards under 40 CFR part 1042 based on the date the vessel enters dry dock for service.

(ii) We may approve the use of an engine meeting less stringent standards if the owner can demonstrate that it took possession of the engine before October 30, 2009, and that engine is a new engine that has not been installed in a non-marine application. Such an engine must at a minimum be certified to the Annex VI NOX emission standard referenced in §1043.60 that applies based on its build date.

(2) The vessel owner must notify us regarding the intent to use this provision. The notification must include a description of the vessel and a summary of the project, including the expected timeline, and other relevant information.

(3) The vessel owner must notify the Designated Certification Officer when the project is complete. We will send the owner a statement that the repowered ship is exempt from fuel sulfur requirements through December 31, 2025; this statement must be kept onboard the vessel for compliance purposes.

(4) All other requirements under this part 1043 continue to apply, including requirements related to bunker delivery notes.

(5) This paragraph (b) applies only for vessels whose hull remains intact through the repowering process. For example, if a steamship is converted to a barge for use with tugboats, those vessels must use fuel meeting the requirements of this part 1043.

(c) In cases of serious economic hardship, we may exempt Great Lakes vessels from the otherwise applicable fuel use requirements under this part.

(1) To be eligible, you must demonstrate that all of the following are true:

(i) Unusual circumstances exist that impose serious economic hardship and significantly affect your ability to comply.

(ii) You have taken all reasonable steps to minimize the extent of the nonconformity.

(iii) No other allowances are available under the regulations in this chapter to avoid the impending violation.

(2) Send the Designated Certification Officer a written request for an exemption no later than January 1, 2014.

(3) Applicants must provide, at a minimum, the following information:

(i) Detailed description of existing contract freight rates, the additional operating costs attributed to complying with the regulations, any loan covenants or other requirements regarding vessel financial instruments or agreements.

(ii) Bond rating of entity that owns the vessels in question (in the case of joint ventures, include the bond rating of the joint venture entity and the bond ratings of all partners; in the case of corporations, include the bond ratings of any parent or subsidiary corporations).

(iii) Estimated capital investment needed to comply with the requirements of this part by the applicable date.

(4) In determining whether to grant the exemptions, we will consider all relevant factors, including the following:

(i) The number of vessels to be exempted.

(ii) The size of your company and your ability to endure the hardship.

(iii) The length of time a vessel is expected to remain out of compliance with this part.

(iv) The ability of an individual vessel to recover capital investments incurred to repower or otherwise modify a vessel to reduce air emissions.

(5) In addition to the application requirements of paragraphs (b)(1) through (4) of this section, your application for temporary relief under this paragraph (b) must also include a compliance plan that shows the period over which the waiver is needed.

(6) We may impose conditions on the waiver, including conditions to limit or recover any environmental loss.

(d) Prior to January 1, 2015, it is not a violation of this part for vessels operating exclusively in the Great Lakes to use a residual fuel not meeting the sulfur limits of Regulation 14.4.2 of Annex VI, where the operator bunkers with the lowest sulfur marine residual fuel that was available within the port area where the vessel bunkered the fuel. For purposes of this paragraph (c), port area means the geographic limits of the port as specified by the Army Corps of Engineers. The reporting and recordkeeping requirements of this part continue to apply for such operation. In addition, if you operate using a residual fuel not meeting the sulfur limits of Regulation 14.4.2 under this paragraph (c), you must send a report to the Designated Certification Officer that identifies the fuel that was used and documents how you determined that no compliant fuel was available. You must send this report within three months after the fueling event.

[75 FR 23013, Apr. 30, 2010, as amended at 77 FR 2478, Jan. 18, 2012; 80 FR 9113, Feb. 19, 2015]