40 CFR § 96.288 - CAIR SO 2 allowance allocations to CAIR SO 2 opt-in units.

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§ 96.288 CAIR SO 2 allowance allocations to CAIR SO 2 opt-in units.

(a) Timing requirements.

(1) When the CAIR opt-in permit is issued under § 96.284(e), the permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit, and submit to the Administrator the allocation for the control period in which a CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 96.284(g), in accordance with paragraph (b) or (c) of this section.

(2) By no later than October 31 of the control period after the control period in which a CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 96.284(g) and October 31 of each year thereafter, the permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit, and submit to the Administrator the allocation for the control period that includes such submission deadline and in which the unit is a CAIR SO2 opt-in unit, in accordance with paragraph (b) or (c) of this section.

(b) Calculation of allocation. For each control period for which a CAIR SO2 opt-in unit is to be allocated CAIR SO2 allowances, the permitting authority will allocate in accordance with the following procedures:

(1) The heat input (in mmBtu) used for calculating the CAIR SO2 allowance allocation will be the lesser of:

(i) The CAIR SO2 opt-in unit's baseline heat input determined under § 96.284(c); or

(ii) The CAIR SO2 opt-in unit's heat input, as determined in accordance with subpart HHH of this part, for the immediately prior control period, except when the allocation is being calculated for the control period in which the CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 96.284(g).

(2) The SO2 emission rate (in lb/mmBtu) used for calculating CAIR SO2 allowance allocations will be the lesser of:

(i) The CAIR SO2 opt-in unit's baseline SO2 emissions rate (in lb/mmBtu) determined under § 96.284(d) and multiplied by 70 percent; or

(ii) The most stringent State or Federal SO2 emissions limitation applicable to the CAIR SO2 opt-in unit at any time during the control period for which CAIR SO2 allowances are to be allocated.

(3) The permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit with a tonnage equivalent equal to, or less than by the smallest possible amount, the heat input under paragraph (b)(1) of this section, multiplied by the SO2 emission rate under paragraph (b)(2) of this section, and divided by 2,000 lb/ton.

(c) Notwithstanding paragraph (b) of this section and if the CAIR designated representative requests, and the permitting authority issues a CAIR opt-in permit (based on a demonstration of the intent to repower stated under § 96.283(a)(5)) providing for, allocation to a CAIR SO2 opt-in unit of CAIR SO2 allowances under this paragraph (subject to the conditions in §§ 96.284(h) and 96.286(g)), the permitting authority will allocate to the CAIR SO2 opt-in unit as follows:

(1) For each control period in 2010 through 2014 for which the CAIR SO2 opt-in unit is to be allocated CAIR SO2 allowances,

(i) The heat input (in mmBtu) used for calculating CAIR SO2 allowance allocations will be determined as described in paragraph (b)(1) of this section.

(ii) The SO2 emission rate (in lb/mmBtu) used for calculating CAIR SO2 allowance allocations will be the lesser of:

(A) The CAIR SO2 opt-in unit's baseline SO2 emissions rate (in lb/mmBtu) determined under § 96.284(d); or

(B) The most stringent State or Federal SO2 emissions limitation applicable to the CAIR SO2 opt-in unit at any time during the control period in which the CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 96.284(g).

(iii) The permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit with a tonnage equivalent equal to, or less than by the smallest possible amount, the heat input under paragraph (c)(1)(i) of this section, multiplied by the SO2 emission rate under paragraph (c)(1)(ii) of this section, and divided by 2,000 lb/ton.

(2) For each control period in 2015 and thereafter for which the CAIR SO2 opt-in unit is to be allocated CAIR SO2 allowances,

(i) The heat input (in mmBtu) used for calculating the CAIR SO2 allowance allocations will be determined as described in paragraph (b)(1) of this section.

(ii) The SO2 emission rate (in lb/mmBtu) used for calculating the CAIR SO2 allowance allocation will be the lesser of:

(A) The CAIR SO2 opt-in unit's baseline SO2 emissions rate (in lb/mmBtu) determined under § 96.284(d) multiplied by 10 percent; or

(B) The most stringent State or Federal SO2 emissions limitation applicable to the CAIR SO2 opt-in unit at any time during the control period for which CAIR SO2 allowances are to be allocated.

(iii) The permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit with a tonnage equivalent equal to, or less than by the smallest possible amount, the heat input under paragraph (c)(2)(i) of this section, multiplied by the SO2 emission rate under paragraph (c)(2)(ii) of this section, and divided by 2,000 lb/ton.

(d) Recordation.

(1) The Administrator will record, in the compliance account of the source that includes the CAIR SO2 opt-in unit, the CAIR SO2 allowances allocated by the permitting authority to the CAIR SO2 opt-in unit under paragraph (a)(1) of this section.

(2) By December 1 of the control period in which a CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 96.284(g), and December 1 of each year thereafter, the Administrator will record, in the compliance account of the source that includes the CAIR SO2 opt-in unit, the CAIR SO2 allowances allocated by the permitting authority to the CAIR SO2 opt-in unit under paragraph (a)(2) of this section.

[70 FR 25362, May 12, 2005, as amended at 71 FR 25390, Apr. 28, 2006]