Regulatory Text: 
Texas Chapter 101 - General Air Quality Rules

SUBCHAPTER H : EMISSIONS BANKING AND TRADING

DIVISION 7 : CLEAN AIR INTERSTATE RULE
Approved by EPA July 30, 2007 (72 FR 41453), effective September 28, 2007 (TXd87).

Outline:
§101.503. Clean Air Interstate Rule Oxides of Nitrogen Annual Trading Budget. G-81, TXd87
§101.504. Timing Requirements for Clean Air Interstate Rule Oxides of Nitrogen Allowance Allocations. G-81, TXd87
§101.506. Clean Air Interstate Rule Oxides of Nitrogen Allowance Allocations. G-81, TXd87
§101.508. Compliance Supplement Pool. G-81, TXd87


§101.503. Clean Air Interstate Rule Oxides of Nitrogen Annual Trading Budget.
As adopted by TCEQ July 12, 2006 effective August 3, 2006 (G-81).
Approved by EPA July 30, 2007 (72 FR 41453) effective September 28, 2007 (TXd87).

     (a) The oxides of nitrogen (NOx) trading budget for annual allocations of Clean Air Interstate Rule NOx allowances for the control periods in 2009 - 2014 and in 2015, and thereafter, shall be equivalent to the tons of NOx emissions listed for Texas in the state trading budget under 40 Code of Federal Regulations §96.140.

     (b) A total amount of Clean Air Interstate Rule NOx allowances equal to 9.5% of the NOx trading budget identified under subsection (a) of this section must be set-aside for allocation to new units.

Adopted July 12, 2006, Effective August 3, 2006 (G-81).
***end tx 101.503***G-81***EPA-R06-OAR-2007-0252***TX058***TXd87***hxr***


§101.504. Timing Requirements for Clean Air Interstate Rule Oxides of Nitrogen Allowance Allocations.
As adopted by TCEQ July 12, 2006 effective August 3, 2006 (G-81).
Approved by EPA July 30, 2007 (72 FR 41453) effective September 28, 2007 (TXd87).
NOT IN SIP: Subsections (a)(2), (a)(3), (a)(4), (c), (d)

     (a) The executive director shall submit to the United States Environmental Protection Agency (EPA) the Clean Air Interstate Rule (CAIR) oxides of nitrogen (NOx) allowance allocations determined in accordance with §101.506(c) of this title (relating to Clean Air Interstate Rule Oxides of Nitrogen Allowance Allocations) by the following dates:

          (1) October 31, 2006, for the 2009 - 2014 control periods;

          (2) NOT IN SIP.

          (3) NOT IN SIP.

          (4) NOT IN SIP.

     (b) For the control period beginning in 2009, and for each control period thereafter, the executive director shall submit to EPA the CAIR NOx allowance allocations determined in accordance with §101.506(d) and (e) of this title by October 31 of the applicable control period.

     (c) NOT IN SIP.

     (d) NOT IN SIP.

Adopted July 12, 2006, Effective August 3, 2006 (G-81).
***end tx 101.504***G-81***EPA-R06-OAR-2007-0252***TX058***TXd87***hxr***


§101.506. Clean Air Interstate Rule Oxides of Nitrogen Allowance Allocations.
As adopted by TCEQ July 12, 2006 effective August 3, 2006 (G-81).
Approved by EPA July 30, 2007 (72 FR 41453) effective September 28, 2007 (TXd87).
NOT IN SIP: Subsections (a)(2), (b)(2), (b)(3), (g).

     (a) For units commencing operation before January 1, 2001:

          (1) for each control period in 2009 - 2015, the baseline heat input, in million British thermal units (MMBtu), is the average of the three highest amounts of the unit's adjusted control period heat input for 2000 - 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 90%;

               (B) if the unit is natural gas-fired during the year, the unit's control period heat input for such year is multiplied by 50%; and

               (C) if the unit is not subject to subparagraph (A) or (B) of this paragraph, the unit's control period heat input for such year is multiplied by 30%.

          (2) NOT IN SIP.

          (3) NOT IN SIP.


     (b) For units commencing operation on or after January 1, 2001:

          (1) for each control period in 2009 - 2014, Clean Air Interstate Rule (CAIR) oxides of nitrogen (NOx) allowances must be allocated from the new unit set-aside identified under §101.503(b) of this title (relating to Clean Air Interstate Rule Oxides of Nitrogen Annual Trading Budget) and determined in accordance with subsection (d) of this section;

          (2) NOT IN SIP.

     (c) For units with a baseline heat input calculated under subsection (a) or (b)(2) or (3) of this section, CAIR NOx allowances must be allocated according to the equation in the following figure.

Figure: 30 TAC §101.506(c)

           HI
A = ------------------ x B
    {Sum i=1 to n}HIi


Where:

A = the amount of Clean Air Interstate Rule (CAIR) oxides of nitrogen (NOx) allowances allocated to a CAIR NOx unit rounded to the nearest whole allowance.

i = each CAIR NOx unit qualifying for an allocation under this subsection.

n = the total number of CAIR NOx units qualifying for an allocation under this subsection.

HI = the baseline heat input for a CAIR NOx unit qualifying for an allocation under this subsection as calculated under subsection (a) or (b)(2) or (3) of this section.
B = a total amount of CAIR NOx allowances equal to 90.5% of the NOx trading budget identified in subsection (a) of this section, except as provided in subsection (e) of this section.

End Figure: 30 TAC §101.506(c)


     (d) For units commencing operation on or after January 1, 2001, and that have not established a baseline heat input in accordance with subsection (b)(2) or (3) of this section, CAIR NOx allowances must be allocated according to the following.

          (1) Beginning 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 subsection (c) of this section, CAIR NOx allowances must be allocated from the new unit set-aside identified under §101.503(b) of this title.  For the first control period in which a CAIR Nox unit commences commercial operation, such CAIR NOx unit will not receive a CAIR NOx allocation from the new unit set-aside.

          (2) To receive a CAIR NOx allowance allocation from the new unit set-aside, the CAIR designated representative shall submit to the executive director a written request on or before July 1 of the first control period for which the CAIR NOx allowance allocation is requested and after the date that the CAIR NOx unit commences commercial operation.

          (3) In a CAIR NOx allowance allocation request under paragraph (2) of this subsection, the amount of CAIR NOx allowances requested for a control period must not exceed the CAIR NOx unit's total tons of NOx emissions reported to EPA for the calendar year immediately preceding such control period.

          (4) The executive director shall review each CAIR NOx allowance allocation request submitted in accordance with this subsection and shall allocate CAIR NOx allowances for each control period as follows.

               (A) The executive director shall accept a CAIR NOx allowance allocation request only if the request meets, or is adjusted as necessary to meet, the requirements of this subsection.

               (B) On or after July 1 of the control period, the executive director shall determine the sum of all accepted CAIR NOx allowance allocation requests for the control period.

               (C) 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 subparagraph (B) of this paragraph, then the executive director shall allocate the full amount of CAIR NOx allowances requested to each CAIR NOx unit covered under a CAIR NOx allowance allocation request that was accepted by the executive director.

               (D) If the amount of CAIR NOx allowances in the new unit set-aside for the control period is less than the sum under subparagraph (B) of this paragraph, then the executive director shall allocate CAIR NOx allowances to each CAIR NOx unit covered under a CAIR NOx allowance allocation request accepted by the executive director according to the equation in the following figure.

Figure: 30 TAC §101.506(d)(4)(D)

            RQ
A =  ----------------- x SA
     {Sum i=1 to n}RQi


Where:
A = the amount of Clean Air Interstate Rule (CAIR) oxides of nitrogen (NOx) allowances, rounded to the nearest whole allowance, allocated to each CAIR NOx unit covered under a CAIR NOx allowance allocation request accepted by the executive director.

i = each CAIR NOx allowance allocation request accepted by the executive director.

n = the total number of CAIR NOx allowance allocation requests accepted by the executive director.

RQ = the amount of the CAIR NOx allowances requested, as adjusted under subparagraph (A) of this paragraph, for each CAIR NOx unit covered under a CAIR NOx allowance allocation request accepted by the executive director.

SA = the total amount of CAIR NOx allowances in the new unit set-aside identified under §101.503(b) of this title (relating to Clean Air Interstate Rule Oxides of Nitrogen Annual Trading Budget).

End Figure: 30 TAC §101.506(d)(4)(D)


               (E) The executive director shall notify each CAIR designated representative who submitted a CAIR NOx allowance allocation request of the amount of CAIR NOx allowances, if any, allocated for the control period to the CAIR NOx unit covered under the request.

     (e) If, after completion of the procedures under subsection (d) of this section for a control period, any unallocated CAIR NOx allowances remain in the new unit set-aside for the control period, the executive director shall allocate to each CAIR NOx unit receiving an allocation under subsection (c) of this section 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 subsection (c) of this section, divided by 90.5% of the NOx trading budget identified in subsection (a) of this section, and rounded to the nearest whole allowance as appropriate.

     (f) A unit's control period heat input, and a unit's status as coal-fired or natural gas-fired, for a calendar year under subsection (a) of this section, and a unit's total tons of NOx emissions during a calendar year under subsection (d) of this section, must be determined in accordance with 40 Code of Federal Regulations (CFR) Part 75, to the extent the unit was otherwise subject to the requirements of 40 CFR Part 75 for the year, or must be based on the best available data reported to the executive director for the unit, to the extent the unit was not otherwise subject to the requirements of 40 CFR Part 75 for the year.

     (g) NOT IN SIP.

Adopted July 12, 2006, Effective August 3, 2006 (G-81).
***end tx 101.506***G-81***EPA-R06-OAR-2007-0252***TX058***TXd87***hxr***


§101.508. Compliance Supplement Pool.
As adopted by TCEQ July 12, 2006 effective August 3, 2006 (G-81).
Approved by EPA July 30, 2007 (72 FR 41453) effective September 28, 2007 (TXd87).

     (a) In addition to the Clean Air Interstate Rule (CAIR) oxides of nitrogen (NOx) allowances allocated under §101.506 of this title (relating to Clean Air Interstate Rule Oxides of Nitrogen Allowance Allocations), the executive director may allocate for the control period in 2009 up to the amount of CAIR NOx allowances listed as the compliance supplement pool for Texas under 40 Code of Federal Regulations (CFR) §96.143.

     (b) For any CAIR NOx unit that achieves NOx emission reductions in 2007 and 2008 that are not necessary to comply with any state or federal emissions limitation applicable during such years, the CAIR designated representative of the unit may request early reduction credits and allocation of CAIR NOx allowances from the compliance supplement pool under subsection (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 40 CFR Part 96, Subpart HH for the entire control period for which early reduction credit is requested.

          (2) The CAIR designated representative of such CAIR NOx unit shall submit to the executive director by July 1, 2009, a written request for allocation of an amount of CAIR NOx allowances from the compliance supplement pool not exceeding the sum of the amounts, in tons, of the unit's NOx emission reductions in 2007 and 2008 that are not necessary to comply with any state or federal emissions limitation applicable during such years, determined in accordance with 40 CFR Part 96, Subpart HH.

     (c) For any CAIR NOx unit 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 subsection (a) of this section, in accordance with the following.

          (1) The CAIR designated representative of such CAIR NOx unit shall submit to the executive director by July 1, 2009, a written request 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 subsection (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 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:
               (A) 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

               (B) obtain under subsections (b) and (d) of this section, or otherwise obtain, a sufficient amount of CAIR NOx allowances to prevent such undue risk.

     (d) The executive director shall review each request under subsections (b) or (c) of this section submitted by July 1, 2009, and shall allocate CAIR NOx allowances for the control period in 2009 to CAIR NOx units covered by such request as follows.

          (1) The executive director shall make any necessary adjustments to the request to ensure that the amount of the CAIR NOx allowances requested meets the requirements of subsections (b) or (c) of this section.

          (2) If the total amount of CAIR NOx allowances in all requests, as adjusted under paragraph (1) of this subsection, is less than the amount of allowances in the compliance supplement pool under subsection (a) of this section, the executive director shall allocate to each CAIR NOx unit covered by a request the amount of CAIR NOx allowances requested, as adjusted under paragraph (1) of this subsection.

          (3) If the total amount of CAIR NOx allowances in all requests, as adjusted under paragraph (1) of this subsection, is more than the amount of allowances in the compliance supplement pool under subsection (a) of this section, the executive director shall allocate CAIR NOx allowances to each CAIR NOx unit covered by a request according to the equation in the following figure.

Figure: 30 TAC §101.508(d)(3)

           RQ
A= -------------------- x SP
    {Sum i=1 to n}RQi


Where:

A = the number of Clean Air Interstate Rule (CAIR) oxides of nitrogen (NOx) allowances, rounded to the nearest whole allowance, allocated from the compliance supplement pool to a unit covered under a compliance supplement pool allocation request accepted by the executive director.

i = each compliance supplement pool allocation request accepted by the executive director.

n = the total number of compliance supplement pool allocation requests accepted by the executive director.

RQ = the amount of CAIR NOx allowances requested for the unit under subsection (b) or (c) of this section, as adjusted under paragraph (1) of this subsection.

SP = the amount of CAIR NOx allowances in the compliance supplement pool.

End Figure: 30 TAC §101.508(d)(3)


          (4) By November 30, 2009, the executive director shall determine, and submit to EPA, the allocations under paragraph (2) or (3) of this subsection.