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Subpart 244-9: CAIR NOx Opt-in Units

(Statutory authority: Environmental Conservation Law, §§ 1-0101, 3-0301, 19-0103, 19-0105, 19-0301, 19-0303,19-0305, 19-0311 and Energy Law §§ 3-101 and 3-103)

[Filed 9/19/07. Effective 10/19/07.]

For administrative information about this posting, contact: Division of Air Resources. The Bureau of Air Quality Planning at (518) 402-8396 is the contact for technical questions pertaining to this rule.

Contents:

Sec.

§244-9.1 Applicability

A CAIR NOx opt-in unit must be a unit that:

(a) is located in the State;

(b) is not a CAIR NOx unit under section 244-1.4 of this Part and is not covered by a retired unit exemption under section 244-1.5 of this Part that is in effect;

(c) is not covered by a retired unit exemption under 40 CFR 72.8 that is in effect;

(d) has or is required or qualified to have a permit under Part 201 of this Title; and

(e) vents all of its emissions to a stack and can meet the monitoring, recordkeeping, and reporting requirements of Subpart 244-8 of this Part.

§244-9.2 General

(a) Except as otherwise provided in sections 244-1.1 through 244-1.4, 244-1.6 through 244-1.8 of this Part, and Subparts 244-2 and 244-3, and Subparts 244-6 through 244-8 of this Part, a CAIR NOx opt-in unit shall be treated as a CAIR NOx unit for purposes of applying such sections and Subparts.

(b) Solely for purposes of applying, as provided in this Subpart, the requirements of Subpart 244-8 of this Part to a unit for which a CAIR opt-in permit application is submitted and not withdrawn and a CAIR opt-in permit is not yet issued or denied under this Subpart, such unit shall be treated as a CAIR NOx unit before issuance of a CAIR opt-in permit for such unit.

§244-9.3 CAIR designated representative

Any CAIR NOx opt-in unit, and any unit for which a CAIR opt-in permit application is submitted and not withdrawn and a CAIR opt-in permit is not yet issued or denied under this Subpart, located at the same source as one or more CAIR NOx units shall have the same CAIR designated representative and alternate CAIR designated representative as such CAIR NOx units.

§244-9.4 Applying for CAIR opt-in permit

The CAIR designated representative of a unit meeting the requirements for a CAIR NOx opt-in unit in section 244-9.1 of this Subpart may apply for an initial CAIR opt-in permit at any time, except as provided under sections 244-9.7(f) and (g) of this Subpart, and, in order to apply, must submit the following:

(a) a complete CAIR permit application under section 244-3.3 of this Part;

(b) a certification, in a format specified by the department, that the unit:

(1) is not a CAIR NOx unit under section 244-1.4 of this Part and is not covered by a retired unit exemption under section 244-1.5 of this Part that is in effect;

(2) is not covered by a retired unit exemption under 40 CFR 72.8 that is in effect;

(3) vents all of its emissions to a stack, and

(4) has documented heat input for more than 876 hours during the six months immediately preceding submission of the CAIR permit application under section 244-3.3 of this Part;

(c) a monitoring plan in accordance with Subpart 244-8 of this Part;

(d) a complete certificate of representation under section 244-2.4 of this Part consistent with section 244-9.3 of this Subpart, if no CAIR designated representative has been previously designated for the source that includes the unit; and

(e) a statement, in a format specified by the department, whether the CAIR designated representative requests that the unit be allocated CAIR NOx allowances under section 244-9.9(b) or (c) of this Subpart (subject to the conditions in sections 244-9.5[h] and 244-9.7[g] of this Subpart). If allocation under section 244-9.9(c) of this Subpart is requested, this statement shall include a statement that the owners and operators of the unit intend to re-power the unit before January 1, 2015 and that they will provide, upon request, documentation demonstrating such intent.

§244-9.5 Opt-in process

The department will issue or deny a CAIR opt-in permit for a unit for which an application for a CAIR opt-in permit under section 244-9.4 of this Subpart is submitted in accordance with the following:

(a) Interim review of monitoring plan. The department and the administrator will determine, on an interim basis, the sufficiency of the monitoring plan accompanying the application for a CAIR opt-in permit under section 244-9.4 of this Subpart. A monitoring plan is sufficient, for purposes of interim review, if the plan appears to contain information demonstrating that the NOx emissions rate and heat input of the unit and all other applicable parameters are monitored and reported in accordance with Subpart 244-8 of this Part. A determination of sufficiency shall not be construed as acceptance or approval of the monitoring plan.

(b) Monitoring and reporting.

(1) (i) If the department and the administrator determine that the monitoring plan is sufficient under subdivision (a) of this section, the owner or operator shall monitor and report the NOx emissions rate and the heat input of the unit and all other applicable parameters, in accordance with Subpart 244-8 of this Part, starting on the date of certification of the appropriate monitoring systems under Subpart 244-8 of this Part and continuing until a CAIR opt-in permit is denied under subdivision (f) of this section or, if a CAIR opt-in permit is issued, the date and time when the unit is withdrawn from the CAIR NOx Annual Trading Program in accordance with section 244-9.7 of this Subpart.

(ii) The monitoring and reporting under subparagraph (i) of this paragraph shall include the entire control period immediately before the date on which the unit enters the CAIR NOx Annual Trading Program under subdivision (g) of this section, during which period monitoring system availability must not be less than 90 percent under Subpart 244-8 of this Part and the unit must be in full compliance with any applicable State or Federal emissions or emissions-related requirements.

(2) To the extent the NOx emissions rate and the heat input of the unit are monitored and reported in accordance with Subpart 244-8 of this Part for one or more control periods, in addition to the control period under subparagraph (1)(ii) of this subdivision, during which control periods monitoring system availability is not less than 90 percent under Subpart 244-8 of this Part and the unit is in full compliance with any applicable State or Federal emissions or emissions-related requirements and which control periods begin not more than three years before the unit enters the CAIR NOx Annual Trading Program under subdivision (g) of this section, such information shall be used as provided in subdivisions (c) and (d) of this section.

(c) Baseline heat input. The unit's baseline heat input shall equal:

(1) if the unit's NOx emissions rate and heat input are monitored and reported for only one control period, in accordance with paragraph (b)(1) of this section, the unit's total heat input (in mmBtu) for the control period; or

(2) if the unit's NOx emissions rate and heat input are monitored and reported for more than one control period, in accordance with paragraphs (b)(1) and (2) of this section, the average of the amounts of the unit's total heat input (in mmBtu) for the control periods under subparagraph (b)(1)(ii) and paragraph (b)(2) of this section.

(d) Baseline NOx emission rate. The unit's baseline NOx emission rate shall equal:

(1) if the unit's NOx emissions rate and heat input are monitored and reported for only one control period, in accordance with paragraph (b)(1) of this section, the unit's NOx emissions rate (in lb/mmBtu) for the control period;

(2) if the unit's NOx emissions rate and heat input are monitored and reported for more than one control period, in accordance with paragraphs (b)(1) and (2) of this section, and the unit does not have add-on NOx emission controls during any such control periods, the average of the amounts of the unit's NOx emissions rate (in lb/mmBtu) for the control periods under subparagraph (b)(1)(ii) and paragraph (b)(2) of this section; or

(3) if the unit's NOx emissions rate and heat input are monitored and reported for more than one control period, in accordance with paragraphs (b)(1) and (2) of this section, and the unit has add-on NOx emission controls during any such control periods, the average of the amounts of the unit's NOx emissions rate (in lb/mmBtu) for such control periods during which the unit has add-on NOx emission controls.

(e) Issuance of CAIR opt-in permit. After calculating the baseline heat input and the baseline NOx emissions rate for the unit under subdivisions (c) and (d) of this section and if the department determines that the CAIR designated representative shows that the unit meets the requirements for a CAIR NOx opt-in unit in section 244-9.1 of this Subpart and meets the elements certified in section 244-9.4(a)(2) of this Subpart, the department will issue a CAIR opt-in permit. The department will provide a copy of the CAIR opt-in permit to the administrator, who will then establish a compliance account for the source that includes the CAIR NOx opt-in unit unless the source already has a compliance account.

(f) Issuance of denial of CAIR opt-in permit. Notwithstanding subdivisions (a) through (e) of this section, if at any time before issuance of a CAIR opt-in permit for the unit, the department determines that the CAIR designated representative fails to show that the unit meets the requirements for a CAIR NOx opt-in unit in section 244-9.1 of this Subpart or meets the elements certified in section 244-9.4(a)(2) of this Subpart, the department will issue a denial of a CAIR opt-in permit for the unit.

(g) Date of entry into CAIR NOx Annual Trading Program. A unit for which a CAIR opt-in permit is issued by the department shall become a CAIR NOx opt-in unit, and a CAIR NOx unit, as of the later of January 1, 2009 or January 1st of the first control period during which such CAIR opt-in permit is issued.

(h) Re-powered CAIR NOx opt-in unit.

(1) If CAIR designated representative requests, and the department issues a CAIR opt-in permit providing for, allocation to a CAIR NOx opt-in unit of CAIR NOx allowances under section 244-9.9(c) of this Subpart and such unit is re-powered after its date of entry into the CAIR NOx Annual Trading Program under subdivision (g) of this section, the re-powered unit shall be treated as a CAIR NOx opt-in unit replacing the original CAIR NOx opt-in unit, as of the date of start-up of the re-powered unit's combustion chamber.

(2) Notwithstanding subdivisions (c) and (d) of this section, as of the date of start-up under paragraph (1) of this subdivision, the re-powered unit shall be deemed to have the same date of commencement of operation, date of commencement of commercial operation, baseline heat input, and baseline NOx emission rate as the original CAIR NOx opt-in unit, and the original CAIR NOx opt-in unit shall no longer be treated as a CAIR NOx opt-in unit or a CAIR NOx unit.

§244-9.6 CAIR opt-in permit contents

(a) Each CAIR opt-in permit will contain:

(1) all elements required for a complete CAIR permit application under section 244-3.3 of this Part;

(2) the certification in section 244-9.4(a)(2) of this Subpart;

(3) the unit's baseline heat input under section 244-9.5(c) of this Subpart;

(4) the unit's baseline NOx emission rate under section 244-9.5(d) of this Subpart;

(5) a statement whether the unit is to be allocated CAIR NOx allowances under section 244-9.9(b) or (c) of this Subpart (subject to the conditions in sections 244-9.5[h] and 244-9.7[g] of this Subpart);

(6) a statement that the unit may withdraw from the CAIR NOx Annual Trading Program only in accordance with section 244-9.7 of this Subpart; and

(7) a statement that the unit is subject to, and the owners and operators of the unit must comply with, the requirements of section 244-9.8 of this Subpart.

(b) Each CAIR opt-in permit is deemed to incorporate automatically the definitions of terms under section 244-1.2 of this Part and, upon recordation by the administrator under Subpart 244-6, 244-7, or 244-9 of this Part, or this Subpart, every allocation, transfer, or deduction of CAIR NOx allowances to or from the compliance account of the source that includes a CAIR NOx opt-in unit covered by the CAIR opt-in permit.

(c) The CAIR opt-in permit shall be included, in a format specified by the permitting authority, in the CAIR permit for the source where the CAIR NOx opt-in unit is located.

§244-9.7 Withdrawal from CAIR NOx Annual Trading Program

Except as provided under subdivision (g) of this section, a CAIR NOx opt-in unit may withdraw from the CAIR NOx Annual Trading Program, but only if the department issues a notification to the CAIR designated representative of the CAIR NOx opt-in unit of the acceptance of the withdrawal of the CAIR NOx opt-in unit in accordance with subdivision (d) of this section.

(a) Requesting withdrawal. In order to withdraw a CAIR NOx opt-in unit from the CAIR NOx Annual Trading Program, the CAIR designated representative of the CAIR NOx opt-in unit shall submit to the department a request to withdraw effective as of midnight of December 31st of a specified calendar year, which date must be at least four years after December 31st of the year of entry into the CAIR NOx Annual Trading Program under section 244-9.5(g) of this Subpart. The request must be submitted no later than 90 days before the requested effective date of withdrawal.

(b) Conditions for withdrawal. Before a CAIR NOx opt-in unit covered by a request under subdivision (a) of this section may withdraw from the CAIR NOx Annual Trading Program and the CAIR opt-in permit may be terminated under subdivision (e) of this section, the following conditions must be met:

(1) For the control period ending on the date on which the withdrawal is to be effective, the source that includes the CAIR NOx opt-in unit must meet the requirement to hold CAIR NOx allowances under section 244-1.6(c) of this Part and cannot have any excess emissions.

(2) After the requirement for withdrawal under paragraph (1) of this subdivision is met, the administrator will deduct from the compliance account of the source that includes the CAIR NOx opt-in unit CAIR NOx allowances equal in amount to and allocated for the same or a prior control period as any CAIR NOx allowances allocated to the CAIR NOx opt-in unit under section 244-9.9 of this Subpart for any control period for which the withdrawal is to be effective. If there are no remaining CAIR NOx units at the source, the administrator will close the compliance account, and the owners and operators of the CAIR NOx opt-in unit may submit a CAIR NOx allowance transfer for any remaining CAIR NOx allowances to another CAIR NOx Allowance Tracking System in accordance with Subpart 244-7 of this Part.

(c) Notification.

(1) After the requirements for withdrawal under subdivisions (a) and (b) of this section are met (including deduction of the full amount of CAIR NOx allowances required), the department will issue a notification to the CAIR designated representative of the CAIR NOx opt-in unit of the acceptance of the withdrawal of the CAIR NOx opt-in unit as of midnight on December 31st of the calendar year for which the withdrawal was requested.

(2) If the requirements for withdrawal under subdivisions (a) and (b) of this section are not met, the department will issue a notification to the CAIR designated representative of the CAIR NOx opt-in unit that the CAIR NOx opt-in unit's request to withdraw is denied. Such CAIR NOx opt-in unit shall continue to be a CAIR NOx opt-in unit.

(d) Permit amendment. After the department issues a notification under paragraph (c)(1) of this section that the requirements for withdrawal have been met, the department will revise the CAIR permit covering the CAIR NOx opt-in unit to terminate the CAIR opt-in permit for such unit as of the effective date specified under paragraph (c)(1) of this section. The unit shall continue to be a CAIR NOx opt-in unit until the effective date of the termination and shall comply with all requirements under the CAIR NOx Annual Trading Program concerning any control periods for which the unit is a CAIR NOx opt-in unit, even if such requirements arise or must be complied with after the withdrawal takes effect.

(e) Reapplication upon failure to meet conditions of withdrawal. If the department denies the CAIR NOx opt-in unit's request to withdraw, the CAIR designated representative may submit another request to withdraw in accordance with subdivisions (a) and (b) of this section.

(f) Ability to reapply to the CAIR NOx Annual Trading Program. Once a CAIR NOx opt-in unit withdraws from the CAIR NOx Annual Trading Program and its CAIR opt-in permit is terminated under this section, the CAIR designated representative may not submit another application for a CAIR opt-in permit under section 244-9.4 of this Subpart for such CAIR NOx opt-in unit before the date that is four years after the date on which the withdrawal became effective. Such new application for a CAIR opt-in permit will be treated as an initial application for a CAIR opt-in permit under section 244-9.5 of this Subpart.

(g) Inability to withdraw. Notwithstanding subdivisions (a) through (f) of this section, a CAIR NOx opt-in unit shall not be eligible to withdraw from the CAIR NOx Annual Trading Program if the CAIR designated representative of the CAIR NOx opt-in unit requests, and the department issues a CAIR NOx opt-in permit providing for, allocation to the CAIR NOx opt-in unit of CAIR NOx allowances under section 244-9.9(c) of this Subpart.

§244-9.8 Change in regulatory status

(a) Notification. If a CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part, then the CAIR designated representative shall notify in writing the department and the administrator of such change in the CAIR NOx opt-in unit's regulatory status, within 30 days of such change.

(b) Department's and administrator's actions.

(1) If a CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part, the department will revise the CAIR NOx opt-in unit's CAIR opt-in permit to meet the requirements of a CAIR permit under section 244-3.4 of this Part, and remove the CAIR opt-in permit provisions, as of the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part.

(2) (i) The administrator will deduct from the compliance account of the source that includes the CAIR NOx opt-in unit that becomes a CAIR NOx unit under section 244-1.4 of this Part, CAIR NOx allowances equal in amount to and allocated for the same or a prior control period as:

(a) any CAIR NOx allowances allocated to the CAIR NOx opt-in unit under section 244-9.9 of this Subpart for any control period after the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part; and

(b) if the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part is not December 31st, the CAIR NOx allowances allocated to the CAIR NOx opt-in unit under section 244-9.9 of this Subpart for the control period that includes the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part, multiplied by the ratio of the number of days, in the control period, starting with the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part divided by the total number of days in the control period and rounded to the nearest whole allowance as appropriate.

(ii) The CAIR designated representative shall ensure that the compliance account of the source that includes the CAIR NOx opt-in unit that becomes a CAIR NOx unit under section 244-1.4 of this Part contains the CAIR NOx allowances necessary for completion of the deduction under subparagraph (i) of this paragraph.

(3) (i) For every control period after the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part, the CAIR NOx opt-in unit will be allocated CAIR NOx allowances under section 244-5.3 of this Part.

(ii) Notwithstanding subparagraph (i) of this paragraph, if the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part is not January 1st, the following amount of CAIR NOx allowances will be allocated to the CAIR NOx opt-in unit (as a CAIR NOx unit) under section 244-5.3 of this Part for the control period that includes the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part:

(a) the amount of CAIR NOx allowances otherwise allocated to the CAIR NOx opt-in unit (as a CAIR NOx unit) under section 244-5.3 of this Part for the control period multiplied by;

(b) the ratio of the number of days, in the control period, starting with the date on which the CAIR NOx opt-in unit becomes a CAIR NOx unit under section 244-1.4 of this Part, divided by the total number of days in the control period; and

(c) rounded to the nearest whole allowance as appropriate.

§244-9.9 NOx allowance allocations to CAIR NOx opt-in units

(a) Timing requirements.

(1) When the CAIR opt-in permit is issued under section 244-9.5(e) of this Subpart, the department will allocate CAIR NOx allowances to the CAIR NOx opt-in unit, and submit to the administrator the allocation for the control period in which a CAIR NOx opt-in unit enters the CAIR NOx Annual Trading Program under section 244-9.5(g) of this Subpart, in accordance with subdivision (b) or (c) of this section.

(2) By no later than October 31st of the control period after the control period in which a CAIR opt-in unit enters the CAIR NOx Annual Trading Program under section 244-9.5(g) of this Subpart and October 31st of each year thereafter, the department will allocate CAIR NOx allowances to the CAIR NOx 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 NOx opt-in unit, in accordance with subdivision (b) or (c) of this section.

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

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

(i) the CAIR NOx opt-in unit's baseline heat input determined under section 244-9.5(c) of this Subpart; or

(ii) the CAIR NOx opt-in unit's heat input, as determined in accordance with Subpart 244-8 of this Subpart, for the immediately prior control period, except when the allocation is being calculated for the control period in which the CAIR NOx opt-in unit enters the CAIR NOx Annual Trading Program under section 244-9.5(g) of this Subpart.

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

(i) the CAIR NOx opt-in unit's baseline NOx emissions rate (in lb/mmBtu) determined under section 244-9.5(d) of this Subpart and multiplied by 70 percent; or

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

(3) The department will allocate CAIR NOx allowances to the CAIR NOx opt-in unit in an amount equaling the heat input under paragraph (1) of this subdivision, multiplied by the NOx emission rate under paragraph (2) of this subdivision, divided by 2,000 lb/ton, and rounded to the nearest whole allowance as appropriate.

(c) Notwithstanding subdivision (b) of this section and if the CAIR designated representative requests, and the department issues a CAIR opt-in permit (based on a demonstration of the intent to re-power stated under section 244-9.4[a][5] of this Subpart) providing for, allocation to a CAIR NOx opt-in unit of CAIR NOx allowances under this subdivision (subject to the conditions in sections 244-9.5[h] and 244-9.7[g]), the department will allocate to the CAIR NOx opt-in unit as follows:

(1) For each control period in 2009 through 2014 for which the CAIR NOx opt-in unit is to be allocated CAIR NOx allowances:

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

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

(a) the CAIR NOx opt-in unit's baseline NOx emissions rate (in lb/mmBtu) determined under section 244-9.5(d) of this Subpart; or

(b) the most stringent State or Federal NOx emissions limitation applicable to the CAIR NOx opt-in unit at any time during the control period in which the CAIR NOx opt-in unit enters the CAIR NOx Annual Trading Program under section 244-9.5(g) of this Subpart.

(iii) The department will allocate CAIR NOx allowances to the CAIR NOx opt-in unit in an amount equaling the heat input under subparagraph (i) of this paragraph, multiplied by the NOx emission rate under subparagraph (ii) of this paragraph, divided by 2,000 lb/ton, and rounded to the nearest whole allowance as appropriate.

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

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

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

(a) 0.15 lb/mmBtu;

(b) the CAIR NOx opt-in unit's baseline NOx emissions rate (in lb/mmBtu) determined under section 244-9.5(d) of this Subpart; or

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

(iii) The department will allocate CAIR NOx allowances to the CAIR NOx opt-in unit in an amount equaling the heat input under subparagraph (i) of this paragraph, multiplied by the NOx emission rate under subparagraph (ii) of this subparagraph, divided by 2,000 lb/ton, and rounded to the nearest whole allowance as appropriate.

(d) Recordation.

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

(2) By December 1st of the control period in which a CAIR NOx opt-in unit enters the CAIR NOx Annual Trading Program under section 244-9.5(g) of this Subpart and December 1st of each year thereafter, the administrator will record, in the compliance account of the source that includes the CAIR NOx opt-in unit, the CAIR NOx allowances allocated by the department to the CAIR NOx opt-in unit under paragraph (a)(2) of this section.