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e-CFR data is current as of December 6, 2019

Title 40Chapter ISubchapter CPart 97 → Subpart EE


Title 40: Protection of Environment
PART 97—FEDERAL NOX BUDGET TRADING PROGRAM, CAIR NOX AND SO2 TRADING PROGRAMS, CSAPR NOX AND SO2 TRADING PROGRAMS, AND TEXAS SO2 TRADING PROGRAM


Subpart EE—CAIR NOX Allowance Allocations


Contents
§97.140   State trading budgets.
§97.141   Timing requirements for CAIR NOX allowance allocations.
§97.142   CAIR NOX allowance allocations.
§97.143   Compliance supplement pool.
§97.144   Alternative of allocation of CAIR NOX allowances and compliance supplement pool by permitting authority.
Appendix A to Subpart EE of Part 97—States With Approved State Implementation Plan Revisions Concerning Allocations

§97.140   State trading budgets.

The State trading budgets for annual allocations of CAIR NOX allowances for the control periods in 2009 through 2014 and in 2015 and thereafter are respectively as follows:

StateState trading budget for 2009-2014
(tons)
State trading budget for 2015 and thereafter
(tons)
Alabama69,02057,517
Delaware4,1663,472
District of Columbia144120
Florida99,44582,871
Georgia66,32155,268
Illinois76,23063,525
Indiana108,93590,779
Iowa32,69227,243
Kentucky83,20569,337
Louisiana35,51229,593
Maryland27,72423,104
Michigan65,30454,420
Minnesota31,44326,203
Mississippi17,80714,839
Missouri59,87149,892
New Jersey12,67010,558
New York45,61738,014
North Carolina62,18351,819
Ohio108,66790,556
Pennsylvania99,04982,541
South Carolina32,66227,219
Tennessee50,97342,478
Texas181,014150,845
Virginia36,07430,062
West Virginia74,22061,850
Wisconsin40,75933,966
Total1,521,7071,268,091

§97.141   Timing requirements for CAIR NOX allowance allocations.

(a) The Administrator will determine by order the CAIR NOX allowance allocations, in accordance with §97.142(a) and (b), for the control periods in 2009, 2010, 2011, 2012, 2013, and 2014.

(b) By July 31, 2011 and July 31 of each year thereafter, the Administrator will determine by order the CAIR NOX allowance allocations, in accordance with §97.142(a) and (b), for the control period in the fourth year after the year of the applicable deadline for determination under this paragraph.

(c) By July 31, 2009 and July 31 of each year thereafter, the Administrator will determine by order the CAIR NOX allowance allocations, in accordance with §97.142(a),(c), and (d), for the control period in the year of the applicable deadline for determination under this paragraph.

(d) The Administrator will make available to the public each determination of CAIR NOX allowances under paragraph (a), (b), or (c) of this section and will provide an opportunity for submission of objections to the determination. Objections shall be limited to addressing whether the determination is in accordance with §97.142. Based on any such objections, the Administrator will adjust each determination to the extent necessary to ensure that it is in accordance with §97.142.

§97.142   CAIR NOX allowance allocations.

(a)(1) The baseline heat input (in mmBtu) used with respect to CAIR NOX allowance allocations under paragraph (b) of this section for each CAIR NOX unit will be:

(i) For units commencing operation before January 1, 2001 the average of the 3 highest amounts of the unit's adjusted control period heat input for 2000 through 2004, with the adjusted control period heat input for each year calculated as follows:

(A) If the unit is coal-fired during the year, the unit's control period heat input for such year is multiplied by 100 percent;

(B) If the unit is oil-fired during the year, the unit's control period heat input for such year is multiplied by 60 percent; and

(C) If the unit is not subject to paragraph (a)(1)(i)(A) or (B) of this section, the unit's control period heat input for such year is multiplied by 40 percent.

(ii) For units commencing operation on or after January 1, 2001 and operating each calendar year during a period of 5 or more consecutive calendar years, the average of the 3 highest amounts of the unit's total converted control period heat input over the first such 5 years.

(2)(i) A unit's control period heat input, and a unit's status as coal-fired or oil-fired, for a calendar year under paragraph (a)(1)(i) of this section, and a unit's total tons of NOX emissions during a calendar year under paragraph (c)(3) of this section, will be determined in accordance with part 75 of this chapter, to the extent the unit was otherwise subject to the requirements of part 75 of this chapter for the year, or will be based on the best available data reported to the Administrator for the unit (in a format prescribed by the Administrator), to the extent the unit was not otherwise subject to the requirements of part 75 of this chapter for the year.

(ii) A unit's converted control period heat input for a calendar year specified under paragraph (a)(1)(ii) of this section equals:

(A) Except as provided in paragraph (a)(2)(ii)(B) or (C) of this section, the control period gross electrical output of the generator or generators served by the unit multiplied by 7,900 Btu/kWh, if the unit is coal-fired for the year, or 6,675 Btu/kWh, if the unit is not coal-fired for the year, and divided by 1,000,000 Btu/mmBtu, provided that if a generator is served by 2 or more units, then the gross electrical output of the generator will be attributed to each unit in proportion to the unit's share of the total control period heat input of such units for the year;

(B) For a unit that is a boiler and has equipment used to produce electricity and useful thermal energy for industrial, commercial, heating, or cooling purposes through the sequential use of energy, the total heat energy (in Btu) of the steam produced by the boiler during the control period, divided by 0.8 and by 1,000,000 Btu/mmBtu; or

(C) For a unit that is a combustion turbine and has equipment used to produce electricity and useful thermal energy for industrial, commercial, heating, or cooling purposes through the sequential use of energy, the control period gross electrical output of the enclosed device comprising the compressor, combustor, and turbine multiplied by 3,413 Btu/kWh, plus the total heat energy (in Btu) of the steam produced by any associated heat recovery steam generator during the control period divided by 0.8, and with the sum divided by 1,000,000 Btu/mmBtu.

(iii) Gross electrical output and total heat energy under paragraph (a)(2)(ii) of this section will be determined based on the best available data reported to the Administrator for the unit (in a format prescribed by the Administrator).

(3) The Administrator will determine what data are the best available data under paragraph (a)(2) of this section by weighing the likelihood that data are accurate and reliable and giving greater weight to data submitted to a governmental entity in compliance with legal requirements or substantiated by an independent entity.

(b)(1) For each control period in 2009 and thereafter, the Administrator will allocate to all CAIR NOX units in a State that have a baseline heat input (as determined under paragraph (a) of this section) a total amount of CAIR NOX allowances equal to 95 percent for a control period during 2009 through 2014, and 97 percent for a control period during 2015 and thereafter, of the tons of NOX emissions in the applicable State trading budget under §97.140 (except as provided in paragraphs (d) and (e) of this section).

(2) The Administrator will allocate CAIR NOX allowances to each CAIR NOX unit under paragraph (b)(1) of this section in an amount determined by multiplying the total amount of CAIR NOX allowances allocated under paragraph (b)(1) of this section by the ratio of the baseline heat input of such CAIR NOX unit to the total amount of baseline heat input of all such CAIR NOX units in the State and rounding to the nearest whole allowance as appropriate.

(c) For each control period in 2009 and thereafter, the Administrator will allocate CAIR NOX allowances to CAIR NOX units in a State that are not allocated CAIR NOX allowances under paragraph (b) of this section because the units do not yet have a baseline heat input under paragraph (a) of this section or because the units have a baseline heat input but all CAIR NOX allowances available under paragraph (b) of this section for the control period are already allocated, in accordance with the following procedures:

(1) The Administrator will establish a separate new unit set-aside for each control period. Each new unit set-aside will be allocated CAIR NOX allowances equal to 5 percent for a control period in 2009 through 2014, and 3 percent for a control period in 2015 and thereafter, of the amount of tons of NOX emissions in the applicable State trading budget under §97.140.

(2) The CAIR designated representative of such a CAIR NOX unit may submit to the Administrator a request, in a format specified by the Administrator, to be allocated CAIR NOX allowances, starting with the later of the control period in 2009 or the first control period after the control period in which the CAIR NOX unit commences commercial operation and until the first control period for which the unit is allocated CAIR NOX allowances under paragraph (b) of this section. A separate CAIR NOX allowance allocation request for each control period for which CAIR NOX allowances are sought must be submitted on or before May 1 of such control period and after the date on which the CAIR NOX unit commences commercial operation.

(3) In a CAIR NOX allowance allocation request under paragraph (c)(2) of this section, the CAIR designated representative may request for a control period CAIR NOX allowances in an amount not exceeding the CAIR NOX unit's total tons of NOX emissions during the calendar year immediately before such control period.

(4) The Administrator will review each CAIR NOX allowance allocation request under paragraph (c)(2) of this section and will allocate CAIR NOX allowances for each control period pursuant to such request as follows:

(i) The Administrator will accept an allowance allocation request only if the request meets, or is adjusted by the Administrator as necessary to meet, the requirements of paragraphs (c)(2) and (3) of this section.

(ii) On or after May 1 of the control period, the Administrator will determine the sum of the CAIR NOX allowances requested (as adjusted under paragraph (c)(4)(i) of this section) in all allowance allocation requests accepted under paragraph (c)(4)(i) of this section for the control period.

(iii) If the amount of CAIR NOX allowances in the new unit set-aside for the control period is greater than or equal to the sum under paragraph (c)(4)(ii) of this section, then the Administrator will allocate the amount of CAIR NOX allowances requested (as adjusted under paragraph (c)(4)(i) of this section) to each CAIR NOX unit covered by an allowance allocation request accepted under paragraph (c)(4)(i) of this section.

(iv) If the amount of CAIR NOX allowances in the new unit set-aside for the control period is less than the sum under paragraph (c)(4)(ii) of this section, then the Administrator will allocate to each CAIR NOX unit covered by an allowance allocation request accepted under paragraph (c)(4)(i) of this section the amount of the CAIR NOX allowances requested (as adjusted under paragraph (c)(4)(i) of this section), multiplied by the amount of CAIR NOX allowances in the new unit set-aside for the control period, divided by the sum determined under paragraph (c)(4)(ii) of this section, and rounded to the nearest whole allowance as appropriate.

(v) The Administrator will notify each CAIR designated representative that submitted an allowance allocation request of the amount of CAIR NOX allowances (if any) allocated for the control period to the CAIR NOX unit covered by the request.

(d) If, after completion of the procedures under paragraph (c)(4) of this section for a control period, any unallocated CAIR NOX allowances remain in the new unit set-aside under paragraph (c) of this section for a State for the control period, the Administrator will allocate to each CAIR NOX unit that was allocated CAIR NOX allowances under paragraph (b) of this section in the State an amount of CAIR NOX allowances equal to the total amount of such remaining unallocated CAIR NOX allowances, multiplied by the unit's allocation under paragraph (b) of this section, divided by 95 percent for a control period during 2009 through 2014, and 97 percent for a control period during 2015 and thereafter, of the amount of tons of NOX emissions in the applicable State trading budget under §97.140, and rounded to the nearest whole allowance as appropriate.

(e) If the Administrator determines that CAIR NOX allowances were allocated under paragraphs (a) and (b) of this section, paragraphs (a) and (c) of this section, or paragraph (d) of this section for a control period and that the recipient of the allocation is not actually a CAIR NOX unit under §97.104 in such control period, then the Administrator will notify the CAIR designated representative and will act in accordance with the following procedures:

(1) Except as provided in paragraph (e)(2) or (3) of this section, the Administrator will not record such CAIR NOX allowances under §97.153.

(2) If the Administrator already recorded such CAIR NOX allowances under §97.153 and if the Administrator makes such determination before making deductions for the source that includes such recipient under §97.154(b) for the control period, then the Administrator will deduct from the account in which such CAIR NOX allowances were recorded under §97.153 an amount of CAIR NOX allowances allocated for the same or a prior control period equal to the amount of such already recorded CAIR NOX allowances. The CAIR designated representative shall ensure that there are sufficient CAIR NOX allowances in such account for completion of the deduction.

(3) If the Administrator already recorded such CAIR NOX allowances under §97.153 and if the Administrator makes such determination after making deductions for the source that includes such recipient under §97.154(b) for the control period, then the Administrator will apply paragraph (e)(1) or (2) of this section, as appropriate, to any subsequent control period for which CAIR NOX allowances were allocated to such recipient.

(4) The Administrator will transfer the CAIR NOX allowances that are not recorded, or that are deducted, in accordance with paragraphs (e)(1), (2), and (3) of this section to a new unit set-aside for the State in which such recipient is located.

§97.143   Compliance supplement pool.

(a) In addition to the CAIR NOX allowances allocated under §97.142, the Administrator may allocate for the control period in 2009 up to the following amount of CAIR NOX allowances to CAIR NOX units in the respective State:

State Compliance
supplement
pool
Alabama10,166
Delaware843
District of Columbia0
Florida8,335
Georgia12,397
Illinois11,299
Indiana20,155
Iowa6,978
Kentucky14,935
Louisiana2,251
Maryland4,670
Michigan8,347
Minnesota6,528
Mississippi3,066
Missouri9,044
New Jersey660
New York0
North Carolina0
Ohio25,037
Pennsylvania16,009
South Carolina2,600
Tennessee8,944
Texas772
Virginia5,134
West Virginia16,929
Wisconsin4,898
Total199,997

(b) For any CAIR NOX unit in a State, if the unit's average annual NOX emission rate for 2007 or 2008 is less than 0.25 lb/mmBtu and, where such unit is included in a NOX averaging plan under §76.11 of this chapter under the Acid Rain Program for such year, the unit's NOX averaging plan has an actual weighted average NOX emission rate for such year equal to or less than the actual weighted average NOX emission rate for the year before such year and if the unit achieves NOX emission reductions in 2007 and 2008, the CAIR designated representative of the unit may request early reduction credits, and allocation of CAIR NOX allowances from the compliance supplement pool under paragraph (a) of this section for such early reduction credits, in accordance with the following:

(1) The owners and operators of such CAIR NOX unit shall monitor and report the NOX emissions rate and the heat input of the unit in accordance with subpart HH of this part in each control period for which early reduction credit is requested.

(2) The CAIR designated representative of such CAIR NOX unit shall submit to the Administrator by May 1, 2009 a request, in a format specified by the Administrator, for allocation of an amount of CAIR NOX allowances from the compliance supplement pool not exceeding the sum of the unit's heat input for the control period in 2007 multiplied by the difference (if any greater than zero) between 0.25 lb/mmBtu and the unit's NOX emission rate for the control period in 2007 plus the unit's heat input for the control period in 2008 multiplied by the difference (if any greater than zero) between 0.25 lb/mmBtu and the unit's NOX emission rate for the control period in 2008, determined in accordance with subpart HH of this part and with the sum divided by 2,000 lb/ton and rounded to the nearest whole number of tons as appropriate.

(c) For any CAIR NOX unit in a State whose compliance with the CAIR NOX emissions limitation for the control period in 2009 would create an undue risk to the reliability of electricity supply during such control period, the CAIR designated representative of the unit may request the allocation of CAIR NOX allowances from the compliance supplement pool under paragraph (a) of this section, in accordance with the following:

(1) The CAIR designated representative of such CAIR NOX unit shall submit to the Administrator by May 1, 2009 a request, in a format specified by the Administrator, for allocation of an amount of CAIR NOX allowances from the compliance supplement pool not exceeding the minimum amount of CAIR NOX allowances necessary to remove such undue risk to the reliability of electricity supply.

(2) In the request under paragraph (c)(1) of this section, the CAIR designated representative of such CAIR NOX unit shall demonstrate that, in the absence of allocation to the unit of the amount of CAIR NOX allowances requested, the unit's compliance with the CAIR NOX emissions limitation for the control period in 2009 would create an undue risk to the reliability of electricity supply during such control period. This demonstration must include a showing that it would not be feasible for the owners and operators of the unit to:

(i) Obtain a sufficient amount of electricity from other electricity generation facilities, during the installation of control technology at the unit for compliance with the CAIR NOX emissions limitation, to prevent such undue risk; or

(ii) Obtain under paragraphs (b) and (d) of this section, or otherwise obtain, a sufficient amount of CAIR NOX allowances to prevent such undue risk.

(d) The Administrator will review each request under paragraph (b) or (c) of this section submitted by May 1, 2009 and will allocate CAIR NOX allowances for the control period in 2009 to CAIR NOX units in a State and covered by such request as follows:

(1) Upon receipt of each such request, the Administrator will make any necessary adjustments to the request to ensure that the amount of the CAIR NOX allowances requested meets the requirements of paragraph (b) or (c) of this section.

(2) If the State's compliance supplement pool under paragraph (a) of this section has an amount of CAIR NOX allowances not less than the total amount of CAIR NOX allowances in all such requests (as adjusted under paragraph (d)(1) of this section), the Administrator will allocate to each CAIR NOX unit covered by such requests the amount of CAIR NOX allowances requested (as adjusted under paragraph (d)(1) of this section).

(3) If the State's compliance supplement pool under paragraph (a) of this section has a smaller amount of CAIR NOX allowances than the total amount of CAIR NOX allowances in all such requests (as adjusted under paragraph (d)(1) of this section), the Administrator will allocate CAIR NOX allowances to each CAIR NOX unit covered by such requests according to the following formula and rounding to the nearest whole allowance as appropriate:

Unit's allocation = Unit's adjusted allocation × (State's compliance supplement pool ÷ Total adjusted allocations for all units)

Where:

“Unit's allocation” is the amount of CAIR NOX allowances allocated to the unit from the State's compliance supplement pool.

“Unit's adjusted allocation” is the amount of CAIR NOX allowances requested for the unit under paragraph (b) or (c) of this section, as adjusted under paragraph (d)(1) of this section.

“State's compliance supplement pool” is the amount of CAIR NOX allowances in the State's compliance supplement pool.

“Total adjusted allocations for all units” is the sum of the amounts of allocations requested for all units under paragraph (b) or (c) of this section, as adjusted under paragraph (d)(1) of this section.

(4) By July 31, 2009, the Administrator will determine by order the allocations under paragraph (d)(2) or (3) of this section. The Administrator will make available to the public each determination of CAIR NOX allowances under such paragraph and will provide an opportunity for submission of objections to the determination. Objections shall be limited to addressing whether the determination is in accordance with paragraph (b) or (c) of this section and paragraph (d)(2) or (3) of this section, as appropriate. Based on any such objections, the Administrator will adjust each determination to the extent necessary to ensure that it is in accordance with such paragraphs.

(5) By January 1, 2010, the Administrator will record the allocations under paragraph (d)(4) of this section.

[65 FR 2727, Jan. 18, 2000, as amended at 71 FR 74795, Dec. 13, 2006]

§97.144   Alternative of allocation of CAIR NOX allowances and compliance supplement pool by permitting authority.

(a) Notwithstanding §§97.141, 97.142, and 97.153 if a State submits, and the Administrator approves, a State implementation plan revision in accordance with §51.123(p)(1) of this chapter providing for allocation of CAIR NOX allowances by the permitting authority, then the permitting authority shall make such allocations in accordance with such approved State implementation plan revision, the Administrator will not make allocations under §§97.141 and 97.142 for the CAIR NOX units in the State, and under §97.153, the Administrator will record the allocations made under such approved State implementation plan revision instead of allocations made under §§97.141 and 97.142.

(b) Notwithstanding §97.143, if a State submits, and the Administrator approves, a State implementation plan revision in accordance with §51.123(p)(2) of this chapter providing for allocation of the State's compliance supplement pool by the permitting authority, then the permitting authority shall make such allocations in accordance with such approved State implementation plan revision, the Administrator will not make allocations under §97.143(d)(4) for the CAIR NOX units in the State, and under §97.143(d)(5), the Administrator will record the allocations of the State's compliance supplement pool made under such approved State implementation plan revision instead of allocations made under §97.143(d)(4).

(c)(1) In implementing paragraph (a) of this section and §§97.141, 97.142, and 97.153, the Administrator will ensure that the total amount of CAIR NOX allowances allocated, under such provisions and under a State's State implementation plan revision approved in accordance with §51.123(p)(1) of this chapter, for a control period for CAIR NOX sources in the State or for other entities specified by the permitting authority will not exceed the State's State trading budget for the year of the control period.

(2) In implementing paragraph (b) of this section and §97.143, the Administrator will ensure that the total amount of CAIR NOX allowances allocated, under such provisions and under a State's State implementation plan revision approved in accordance with §51.123(p)(2), for CAIR NOX sources in the State will not exceed the State's compliance supplement pool.

[65 FR 2727, Jan. 18, 2000, as amended at 71 FR 74795, Dec. 13, 2006]

Appendix A to Subpart EE of Part 97—States With Approved State Implementation Plan Revisions Concerning Allocations

1. The following States have State Implementation Plan revisions under §51.123(p)(1) of this chapter approved by the Administrator and providing for allocation of CAIR NOX allowances by the permitting authority under §97.144(a):

Indiana

Louisiana

Michigan

New Jersey

North Carolina

Ohio

South Carolina

Tennessee

Texas (for control periods 2009-2014)

West Virginia (for control periods 2009-2014)

Wisconsin

2. The following States have State Implementation Plan revisions under §51.123(p)(2) of this chapter approved by the Administrator and providing for allocation of the Compliance Supplement Pool by the permitting authority under §97.144(b):

Indiana

Michigan

New Jersey

Ohio

South Carolina

Texas

[65 FR 2727, Jan. 18, 2000, as amended at 72 FR 41459, July 30, 2007; 72 FR 46394, Aug. 20, 2007; 72 FR 52293, Sept. 13, 2007; 72 FR 55068, Sept. 28, 2007; 72 FR 55672, Oct. 1, 2007; 72 FR 56920, Oct. 5, 2007; 72 FR 57215, Oct. 9, 2007; 72 FR 58546, Oct. 16, 2007; 72 FR 59487, Oct. 22, 2007; 72 FR 71579, Dec. 18, 2007; 72 FR 72262, Dec. 20, 2007; 73 FR 6040, Feb. 1, 2008]

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