40 Cfr Part 73-Sulfur Dioxide Allowance System

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40 CFR Ch. I (7–1–00 Edition)Pt. 72, App. D

density), in lbs SO2/thousand gal oi l, i s by oiltype:

Oil type AP–42 factor

Distillate (light) .................... ....... 142 lbs/1,000 galResidual (heavy) ....................... 157

F or all fuel, t he unit s conversion factor is1 ton/2000 lbs.

A P P E N D I X D T O P A R T 72— CA L C U L A T I O NOF P O T E N T I A L E L E C T R I C OU T P U T CA-P A C I T Y

T he potenti al elect ri cal output capacity iscalculated from the maximum design heatinput from the boiler by the following equa-tion:

max. design heat input

3

kw-hr

Btu

MWe

1000 Kw× ×

× ×1

3413

1

F or example:

(1) Assume a boiler with a maximum de-sign heat input capacity of 340 millionBtu/hr.

(2) One-third of the maximum design heatinput capacit y i s 113.3 mmBtu/hr. T heone-third factor relates to the thermo-dynamic efficiency of the boil er.

(3) To express th is i n MWe, the standardsconversi on of 3413 Btu to 1 kw-hr i s used:113.3×106 Btu/hr×1 kw-hr / 3413 Btu×1 MWe/ 1000 kw=33.2 MWe

[58 F R 15649, Mar . 23, 1993]

PART 73—SULFUR DIOXIDEALLOWANCE SYSTEM

Subpart A—Background and Summary

Sec.73.1 P urpose and scope.73.2 Applicability.73.3 General.

Subpart B—Allowance Allocations

73.10 Ini ti al all ocati ons for phase I andphase I I .

73.11 [Reserved]73.12 Rounding procedures.73.13 P rocedures for submitt als.73.14–73.17 [R eserved]73.18 Submit tal procedures for units com-

mencing commercial operation duringthe period from J anuary 1, 1993, through

December 31, 1995.73.19 Certain unit s wit h declini ng SO2 rates.73.20 P hase II early r eduction credit s.73.21 P hase I I r epoweri ng all owances.73.22–73.24 [R eserved]73.25 P hase I extension reserve.73.26 Conservat ion and renewable energy re-

serve.73.27 Special all owance reserve.

Subpart C—Allowance Tracking System

73.30 A ll owance tr acking system accounts.

73.31 Establi shment of accounts.73.32 A ll owance account contents.73.33 Authori zed account representati ve.73.34 Recordati on in accounts.73.35 Compliance.73.36 Banki ng.73.37 Account error and dispute resoluti on.73.38 Closing of accounts.

Subpart D—Allowance Transfers

73.50 Scope and submission of t ransfers.73.51 Pr ohibition.73.52 EP A recordation.73.53 Notification.

Subpart E—Auctions, Direct Sales, and

Independent Power Producers WrittenGuarantee

73.70 Auctions.73.71 Bidding.73.72 Direct sales.73.73 Delegation of aucti ons and sales and

termination of auctions and sales.

Subpart F—Energy Conservation andRenewable Energy Reserve

73.80 Operation of all owance reserve pro-gram for conservation and renewable en-ergy.

73.81 Quali fied conservati on measures andrenewable energy generati on.

73.82 Appli cation for all owances from re-serve program.

73.83 Secretary of E nergy’s acti on on net i n-come neutrality applications.

73.84 Administrator’s action on applica-tions.

73.85 Administr ator review of the reserveprogram.

73.86 State regulatory autonomy.

A P P E N D I X A T O SU B P A R T F — L I S T OF QU A L I-F I E D E N E R G Y CO N S E R V A T I O N M E A S U R E S,QU A L I F I E D R E N E W A B L E GE N E R A T I O N, A NDM E A S U R E S A P P L I C A BL E F OR R E D U C E D U T I -L I Z A T I O N

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Environmental Protection Agency § 73.10

Subpart G—Small Diesel Refineries

73.90 A ll owance all ocations for small dieselrefineries.

A U T H O R I T Y : 42 U.S.C. 7601 and 7651 et seq.

Subpart A—Background andSummary

SO UR CE: 58 F R 3687, J an. 11, 1993, unl essotherwise noted.

§ 73.1 Purpose and scope.

T he purpose of thi s part is to estab-lish the requirements and proceduresfor the following:

(a) T he all ocation of sulfur dioxideemissions all owances;

(b) T he track ing, holding, and tr ans-fer of allowances;

(c) The deducti on of all owances forpurposes of compliance and for pur-poses of offsetting excess emissionspursuant to parts 72 and 77 of thischapter;

(d) The sale of allowances throughEP A-sponsored auctions and a directsale, including the independent powerproducers written guarantee program;and

(e) The appli cation for , and dist ri bu-

tion of, allowances from the Conserva-tion and Renewable Energy Reserve.

(f) The applicat ion for, and distr ibu-tion of, allowances for desulfurizationof fuel by small diesel refineries.

[58 F R 3687, J an. 11, 1993, as amended at 58F R 15650, Mar. 23, 1993]

§ 73.2 Applicability.

T he fol lowing part ies shall be subjectto the provisions of thi s part :

(a) Owners, operators, and designatedrepresentatives of affected sources andaffected units pursuant to §72.6 of thischapter;

(b) Any new independent power pro-ducer as defined in section 416 of theAct and §72.2 of thi s chapter, except asprovi ded in secti on 405(g)(6) of the Act ;

(c) Any owner of an affected unit whomay apply to receive allowances underthe Energy Conservation and Renew-able Energy Reserve P rogram estab-li shed in accordance with secti on 404(f)of the Act ;

(d) Any small diesel r efinery as de-fined in §72.2 of this chapter, and

(e) Any other person, as defined in§72.2 of this chapter, who chooses topurchase, hold, or transfer allowancesas provided in secti on 403(b) of the Act.

§73.3 General.

P art 72 of thi s chapter, including§§72.2 (defini t ions), 72.3 (measur ements,abbreviations, and acronyms), 72.4(F ederal author it y), 72.5 (St ate author-it y), 72.6 (appli cabil it y), 72.7 (new unit sexemption), 72.8 (retired unit exemp-tion), 72.9 (standard requirements),72.10 (availability of information), and72.11 (computation of time) of part 72,subpart A of this chapter, shall applyto t his part . The procedures for appealsof decisions of the Administr ator underthis part are contained in part 78 of this chapter. Sections 73.3 (Definitions)and 73.4 (Deadlines), which were pre-viously published with subpart E of

thi s part — ‘‘Aucti ons, Dir ect Sales,andIndependent P ower P roducers Wr it -ten Guarantee’’, are codified at §§72.2and 72.12 of this chapter, respectively.

Subpart B—Allowance Allocations

SO UR CE: 58 F R 3687, J an. 11, 1993, unlessotherwise noted.

§ 73.10 Initial allocations for phase Iand phase II.

(a) Ph ase I al low an ces. T he Adminis-trator will allocate allowances to theunit account for each unit listed intable 1 of this section in the amountlisted in column A to be held in eachfuture year subaccount for the years1995 thr ough 1999.

TABLE 1—PHASE I ALLOWANCE ALLOCATIONS

State name Plant name BoilerColumn A finalphase 1 allo-

cation

Column Bauction and

sales re-serve

Alabama ...................................................................... Colbert ................................. 1 13213 3572 14907 4033 14995 4054 15005 405



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TABLE 1—PHASE I ALLOWANCE ALLOCATIONS —Continued


cation

Column Bauction and

sales re-serve

5 36202 978E.C. Gaston ........................ 1 17624 476

2 18052 4883 17828 4824 18773 5075 58265 1575

Florida ......................................................................... Big Bend ............................. BB01 27662 748BB02 26387 713BB03 26036 704

Crist ..................................... 6 18695 5057 30846 834

Georgia ....................................................................... Bowen ................................. 1BLR 54838 14822BLR 53329 14413BLR 69862 18884BLR 69852 1888

Hammond ............................ 1 8549 2312 8977 2433 8676 2344 36650 990

Jack McDonough ................ MB1 19386 524MB2 20058 542

Wansley .............................. 1 68908 18622 63708 1722

Yates .. ... .... ... .... ... ... .... ... .... .. Y1BR 7020 190Y2BR 6855 185Y3BR 6767 183Y4BR 8676 234Y5BR 9162 248Y6BR 24108 652Y7BR 20915 565

Illinois .......................................................................... Baldwin ................................ 1 46052 12452 48695 13163 46644 1261

Coffeen ................................ 01 12925 34902 39102 1057

Grand Tower ....................... 09 6479 175Hennepin ............................. 2 20182 545Joppa Steam ....................... 1 12259 331

2 10487 2833 11947 3234 11061 2995 11119 3016 10341 279

Kincaid ................................ 1 34564 9342 37063 1002

Meredosia ........................... 05 15227 411Vermilion ............................. 2 9735 263

Indiana ........................................................................ Bailly .................................... 7 12256 3318 17134 463

Breed ................................... 1 20280 548Cayuga ................................ 1 36581 989

2 37415 1011Clifty Creek ......................... 1 19620 530

2 19289 5213 19873 5374 19552 5285 18851 5096 19844 536

Elmer W. Stout .................... 50 4253 11560 5229 14170 25883 699

F.B. Culley .......................... 2 4703 1273 18603 503

Frank E. Ratts ..................... 1SG1 9131 2472SG1 9296 251

Gibson ................................. 1 44288 11972 44956 12153 45033 12174 44200 1195

H.T. Pritchard ...................... 6 6325 171



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cation

Column Bauction and

sales re-serve

Michigan City ...................... 12 25553 691Petersburg ........................... 1 18011 487

2 35496 959R. Gallagher ........................ 1 7115 192

2 7980 2163 7159 1934 8386 227

Tanners Creek .................... U4 27209 735Wabash River ..................... 1 4385 118

2 3135 853 4111 111

5 4023 1096 13462 364Warrick ................................ 4 29577 799

Iowa ............................................................................ Burlington ............................ 1 10428 282Des Moines ......................... 11 2259 61George Neal ........................ 1 2571 69Milton L. Kapp ..................... 2 13437 363Prairie Creek ....................... 4 7965 215Riverside ............................. 9 3885 105

Kansas ........................................................................ Quindaro ............................. 2 4109 111Kentucky ..................................................................... Coleman .............................. C1 10954 296

C2 12502 338C3 12015 325

Cooper ................................ 1 7254 1962 14917 403

E.W. Brown ......................... 1 6923 1872 10623 2873 25413 687

Elmer Smith ........................ 1 6348 1722 14031 379

Ghent .................................. 1 27662 748Green River ......................... 5 7614 206H.L. Spurlock ...................... 1 22181 599HMP&L Station 2 ................ H1 12989 351

H2 11986 324Paradise .............................. 3 57613 1557Shawnee ............................. 10 9902 268

Maryland ..................................................................... C.P. Crane .......................... 1 10058 2722 8987 243

Chalk Point .......................... 1 21333 5772 23690 640

Morgantown ........................ 1 34332 9282 37467 1013

Michigan ...................................................................... J.H. Campbell ..................... 1 18773 5072 22453 607

Minnesota .................................................................... High Bridge ......................... 6 4158 112Mississippi ................................................................... Jack Watson ....................... 4 17439 471

5 35734 966Missouri ....................................................................... Asbury ................................. 1 15764 426

James River ........................ 5 4722 128LaBadie ............................... 1 39055 1055

2 36718 9923 39249 10614 34994 946

Montrose ............................. 1 7196 1942 7984 2163 9824 266

New Madrid ......................... 1 27497 7432 31625 855

Sibley .................................. 3 15170 410Sioux ................................... 1 21976 594

2 23067 623Thomas Hill ......................... MB1 9980 270

MB2 18880 510New Hampshire .......................................................... Merrimack ........................... 1 9922 268

2 21421 579New Jersey ................................................................. B.L. England ....................... 1 8822 238

2 11412 308New York .................................................................... Dunkirk ................................ 3 12268 332



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cation

Column Bauction and

sales re-serve

4 13690 370Greenidge ........................... 6 7342 198Milliken ................................ 1 10876 294

2 12083 327Northport ............................. 1 19289 521

2 23476 6343 25783 697

Port Jefferson ...................... 3 10194 2764 12006 324

Ohio ............................................................................ Ashtabula ............................ 7 18351 496Avon Lake ........................... 11 12771 345

12 33413 903Cardinal ............................... 1 37568 10152 42008 1135

Conesville ............................ 1 4615 1252 5360 1453 6029 1634 53463 1445

Eastlake .............................. 1 8551 2312 9471 2563 10984 2974 15906 4305 37349 1009

Edgewater ........................... 13 5536 150Gen. J.M. Gavin .................. 1 86690 2343

2 88312 2387Kyger Creek ........................ 1 18773 507

2 18072 4883 17439 4714 18218 4925 18247 493

Miami Fort ........................... 5–1 417 115–2 417 116 12475 3377 42216 1141

Muskingum River ................ 1 16312 4412 15533 4203 15293 4134 12914 3495 44364 1199

Niles .................................... 1 7608 2062 9975 270

Picway ................................. 9 5404 146R.E. Burger ......................... 5 3371 91

6 3371 917 11818 3198 13626 368

W.H. Sammis ...................... 5 26496 7166 43773 11837 47380 1280

Walter C. Beckjord .............. 5 9811 2656 25235 682

Pennsylvania ............................................................... Armstrong ............................ 1 14031 3792 15024 406

Brunner Island ..................... 1 27030 7302 30282 8183 52404 1416

Cheswick ............................. 1 38139 1031Conemaugh ......................... 1 58217 1573

2 64701 1749Hatfield’s Ferry .................... 1 36835 995

2 36338 9823 39210 1060

Martins Creek ...................... 1 12327 3332 12483 337

Portland ............................... 1 5784 1562 9961 269

Shawville ............................. 1 10048 2722 10048 2723 13846 374



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cation

Column Bauction and

sales re-serve

4 13700 370Sunbury ............................... 3 8530 230

4 11149 301Tennessee .................................................................. Allen .................................... 1 14917 403

2 16329 4413 15258 412

Cumberland ......................... 1 84419 22812 92344 2496

Gallatin ................................ 1 17400 4702 16855 4553 19493 527

4 20701 559Johnsonville ........................ 1 7585 205

10 7351 1992 7828 2123 8189 2214 7780 2105 8023 2176 7682 2087 8744 2368 8471 2299 6894 186

West Virginia ............................................................... Albright ................................ 3 11684 316Fort Martin ........................... 1 40496 1094

2 40116 1084Harrison . .... ... .... ... .... ... ... .... .. 1 47341 1279

2 44936 12143 40408 1092

Kammer ............................... 1 18247 4932 18948 5123 16932 458

Mitchell .. ... .... ... .... ... .... ... ... ... 1 42823 11572 44312 1198

M.T. Storm .......................... 1 42570 11502 34644 9363 41314 1116

Wisconsin .................................................................... Edgewater ........................... 4 24099 651Genoa ................................. 1 22103 597Nelson Dewey ..................... 1 5852 158

2 6504 176North Oak Creek ................. 1 5083 137

2 5005 1353 5229 1414 6154 166

Pulliam ................................ 8 7312 198South Oak Creek ................ 5 9416 254

6 11723 3177 15754 4268 15375 415

(b) Pha se I I a l low ances. (1) T he Ad-ministrator wil l allocate all owances to

the unit account for each unit listed intable 2 of this section in the amountspecified in table 2 column C to be heldin the future year subaccounts rep-resenting calendar years 2000 through2009.

(2) The Administrator will allocateall owances to t he unit account for each

unit listed in table 2 of this section inthe amount specified in table 2 columnF to be held in the future year sub-accounts representing calendar years2010 and each year thereafter.



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(3) The owner of each unit l isted inthe following table shall surrender, foreach allowance li sted in Col umn A or Bof such table, an allowance of the sameor earlier compliance use date andshall return to the Administrator any

proceeds received from allowanceswithheld from the unit, as listed inColumn C of such table. The all owancesshall be surrendered and the proceedsshal l be returned by December 28, 1998.

State Plant name Unit

Allowances for2000 through

2009column (A)

Allowances for2010 andthereafter

column (B)

Proceeds

CA .................. El Centro ............................................ 2 285 272 $2749.48

CO .................. Valmont .............................................. 11 4 0 0FL .. ... ... .... ... .... Lauderdale .. ... .... ... .... ... ... .... ... .... ... .... . PFL4 776 781 7904.74

FL .. ... ... .... ... .... Lauderdale .. ... .... ... .... ... ... .... ... .... ... .... . PFL5 796 802 7904.74

LA ................... R S Nelson ......................................... 1 30 34 0

LA ................... R S Nelson ......................................... 2 33 32 0

MD ................. R P Smith ........................................... 9 0 56 687.37

NM ................. Maddox .............................................. **3 85 85 687.37

SD .................. Mobile ................................................. **2 17 17 0

VA . ... .... ... ... .... Chesterfield .... ... ... .... ... .... ... .... ... ... .... .. **8B 409 411 4124.21

WI ................... Blount Street ...................................... 7 0 13 343.68

WI ................... Blount Street ...................................... 8 0 294 3093.16

WI ................... Blount Street ...................................... 9 0 355 3436.84



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40 CFR Ch. I (7–1–00 Edition)§ 73.11

[58 F R 3687, J an. 11, 1993, as amended at 58F R 15650, M ar. 23, 1993; 58 F R 33770, J une 21,1993; 58 FR 40747, J ul y 30, 1993; 62 F R 55486,Oct. 24, 1997; 63 F R 51714, Sept . 28, 1998]

§73.11 [Reserved]

§ 73.12 Rounding Procedures.

(a) Ca lcu la t i on round ing . All allow-ances under this part and part 72 of this chapter shall be allocated as wholeallowances. All calculations for suchallowances shall be rounded down fordecimal s less than 0.500 and up for deci-

mals of 0.500 or greater.(b) [Reserved]

[58 F R 3687, J an. 11, 1993, as amended at 63F R 51765, Sept. 28, 1998]

§ 73.13 Procedures for submittals.

(a) Add ress for submi t ta l . All submit-tals under this subpart shall be madeby the designated representative to theDi rector, Acid Rai n Divi sion, (6204J ),401 M Street, SW., Washington, DC20460 and shal l meet the requi rementsspecif ied in 40 CF R 72.21.

(b) A ppeals pr ocedu res. T he designat edrepresentative may appeal the decisionas to eligibility or allocation of allow-ances under §§73.18, 73.19, and 73.20,using the appeals procedures of part 78of thi s chapter.

[58 F R 15708, Mar . 23, 1993 as amended at 63F R 51765, Sept. 28, 1998]

§§73.14–73.17 [Reserved]

§ 73.18 Submittal procedures for unitscommencing commercial operationduring the period from January 1,1993, through December 31, 1995.

(a) E l i g i b i l i t y . T o be eligibl e for al low-ances under this section, a unit shallcommence commercial operation be-tween J anuary 1, 1993, and December

31, 1995, and have commenced construc-t ion before December 31, 1990.

(b) App l ica t ion for a l l owan ces. No laterthan December 31, 1995, the designatedrepresentative for a unit expected to beeligible under this provision must sub-mit a photocopy of a signed contractfor the construction of the unit.

(c) Commencement of commercia l oper- a t i on . T he Administr ator wi l l use E IAinformation submitted by the utility

for the boiler on-line date as com-mencement of commercial operation.

[58 F R 15710, Mar . 23, 1993]

§ 73.19 Certain units with declining SO2 rates.

(a) E l i g i b i l i t y . A unit i s eli gible for al-lowance allocations under this sectionif it meets the following requirements:

(1) It is an existing unit that is autil ity unit;

(2) I t serves a generator wit h name-plate capacity equal to or greater than75 MWe;

(3) I ts 1985 actual SO2 emissions ratewas equal to or greater than 1.2 lb/mmBtu;

(4) I ts 1990 actual SO2 emissions rateis at least 50 percent less than the less-er of its 1980 actual or allowable SO2emissions rate;

(5) I ts actual S O2 emission rate is lessthan 1.2 lb/mmBtu in any one calendaryear from 1996 through 1999, as report edunder part 75 of this chapter;

(6) I t commenced commerci al oper-ati on after J anuary 1, 1970;

(7) It is part of a utility systemwhose combined commerci al and indus-trial kilowatt-hour sales increasedmore than 20 percent between calendar

years 1980 and 1990; and(8) It is part of a utility system

whose company-wide fossil-fuel SO2emissions rate declined 40 percent ormore from 1980 to 1988.

(b)[Reserved]

[58 F R 15710, Mar. 23, 1993, as amended at 63F R 51765, Sept . 28, 1998]

§ 73.20 Phase II early reduction cred-its.

(a) Un i t e l i g i b i l i t y . Units listed intable 2 or 3 of §73.10 are el igibl e for al -lowances under this section if:

(1) T he unit is not a uni t subject t oemissions limitation requirements of P hase I and is not a substit uti on unit(under 40 CF R 72.41) or a compensatinguni t (under 40 CF R 72.43);

(2) T he unit is authorized by the Gov-ernor of the State in which the unit islocated;

(3) The unit is part of a utility sys-tem (which, for the purposes of thissection only, includes all generatorsoperated by a single utility, includinggenerators that are not fossil fuel-fir ed) that has decreased it s total coal-



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fired generation, as a percentage of total system generation, by more thantwenty percent between J anuary 1,1980, and December 31, 1985; and

(4) The unit is part of a utility sys-tem that during calendar years 1985

through 1987 had a weighted capacityfactor for all coal-fired units in thesystem of l ess than fi fty percent. T heweighted capacity factor is equal to:

(b) Emi ssions reduct i ons el ig ib i l i ty . Sul-

fur dioxide emissions reductions eligi-ble for allowance credits at units eligi-ble under paragraph (a) of this sectionmust meet the foll owing requir ements:

(1) Be made no earlier than calendaryear 1995 and no later than calendaryear 1999; and

(2) Be due to physical changes to theplant or are a result of a change in themethod of operating the plant includ-ing but not limited to changing thetype or quality of fuel being burned.

(c) I n i t i a l ce r t i f i c a t i on o f e l i g i b i l i t y . T he designated representative of a uni tthat seeks allowances under this sec-tion shall apply for certification of unit eligibility prior to or accom-

panying a request for allowances underparagraph (d) of this section. A com-pleted application for this certificationshall be submitted according to §73.13and shall include the foll owing:

(1) A letter from the Governor of theState in which the unit is located au-thorizing the unit to make reductionsin sulfur dioxide emissions; and

(2) A report listing all units in theutility system, each fossil fuel-firedunit’s fuel consumption and fuel heatcontent for calendar year 1980, andeach generator’s total electrical gen-erat ion for calendar years 1980 and 1985(including all generators, whether fos-sil fuel-fired, nuclear, hydroelectric or

other).(d) Request f or al low ances. (1) T he des-

ignated representative of the request-ing unit shall submit the request forallowances according to the proceduresof §73.13 and shall include the foll owinginformation:

(i) T he calendar year for which cred-its for reductions are requested and theactual SO2 emissions and fuel consump-ti on in that year;

(ii) A letter signed by the designated

representative stating and docu-menting the specific physical changesto the plant or changes in the methodof operating the plant (including butnot limited to changing the type orquality of fuel being burned) which re-sulted in the reduction of emissions;and

(ii i) A letter signed by t he designatedrepresentative certifying that all pho-tocopies are exact copies.

(2) T he designated representat iveshall submit each request for allow-ances no later than March 1 of the cal-endar year following the year in whichthe reductions were made.

(e) Al lowan ce a l loca t ion . T he Adminis-trator will allocate allowances to theeligible unit upon satisfactory sub-mittal of information under paragraphs(c) and (d) of this section in theamount calculated by the followingequations. Such allowances will be al-located to the unit’s 2000 future yearsubaccount.

(1) ‘‘P ri or year’’ means a single cal -endar year selected by the eligible unitfrom 1995 to 1999 inclusive.

(2) One ‘‘credit’’ equals one ton of eli-gible SO2 emissions reductions.

(3) ‘‘ERC units’’ are units eligible forearly reduction credits, and ‘‘non-ERCunits’’ are fossil fuel-fired units that

are part of the same operating systembut are not eligible for early reductioncredits.

(4) F or any unit that did not operateduring 1990, t he uni t’s 1990 SO2 emis-sion rate will be equal to the weightedaverage emission rate of all of theother unit s at the same source that didoperat e during 1990.

(5) Early reduction credits will becalculated at the unit level, subject to



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the restrictions in paragraph (e)(6) of this section.

(6) The number of credit s for el igi bleP hase I I unit s wil l be calculated as fol-lows:

(i) Compar ison of th e pr io r y ear u t i l i za - t ion of ERC u n i t s to the 1990 ut i l i za t ion ,

as a percentage of system ut i l izat ion. I f,as calculated below, system-wide prior

year utilization of ERC units exceedssystems-wide 1990 utilization of ERCunits on a percentage basis, then para-graphs (e)(6)(ii) and (iii) of this sectionapply. If not, the ERC units are eligibleto receive early reduction credits ascalculated in paragraph (e)(6)(v)(A) of thi s secti on.

(ii) Compar ison of t he pr io r y ear aver - age emission r a te of a l l ERC u n i t s to the

prior year average emission rate of al l non -ERC u n i t s . If, as calculated below,the system-wide average SO2 emissionrate of ERC units exceeds that of non-

ER C units, then a unit ’s pri or year uti -lization will be restricted in accord-

ance with paragraph (e)(6)(iv) of thissection. If not, then paragraph (iii) of this section applies.



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(iii) Compari son of th e emission rat e of the non -ERC un i t s in the p r i o r yea r to th e

emiss ion ra te of the non-ERC un i ts in

1990. If, as calculated in paragraph (ii)of this section, the prior year systemaverage non-ERC SO2 emission rate in-creases above the 1990 syst em averagenon-ERC SO2 emission rate, as cal-

culated below, then a unit’s prior yearutilization will be restricted in accord-ance with paragraph (e)(6)(iv) of thissection. If not, the ERC units are eligi-ble to receive early reduction creditsas calculated in paragraph (e)(6)(v)(A)of thi s secti on.

(iv) Ca lcu la t i on o f the u t i l i z at i on l im i t fo r rest r i c ted u n i t s. T he l imi t on ut i l iza-tion for each unit eligible for early re-

duction credits subject to paragraphs(e)(6) (ii ) and (iii ) of thi s secti on wil l becalculated as foll ows:

T hi s resul t, expressed in mi l l ionBtus, is the restr icted uti li zati on of theERC unit to be used in the calculationof early reduction credits in paragraph(e)(6)(v)(B) of t his secti on.

(v)(A) Calcu la t i on of the un i t ’s ear ly re- duc t ion cred i ts where the un i t ’ s pr io r y ear

u t i l i za t ion is not rest r i c ted .

(B) Calcu la t ion of the un i t ’s ear ly re- duc t ion cred i ts where th e un i t ’ s pr io r y ear

u t i l i za t i on is rest r i c ted .



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(vi) The Administrator will allocateto the ERC unit allowances equal tothe lesser of the calculated number of

credits in paragraphs (e)(6)(v) (A) or (B)of this section and the following limi-tation:

(f) Al lowance loan program. (1) E l i g i - b i l i t y . Units eligible for Phase II earlyreduction credits under paragraph (a)of this section are eligible for allow-ances under this paragraph (f) if theweighted average emission rate (based

on heat input) for the prior year for allof the affected units in the unit’s dis-patch system was less than the system-wide weighted average emission ratefor 1990. T he weighted average emissionrate shall be calculated as follows:

Weighted Average Emission Rate =Unit Emission Rate Unit Utilization (inmmBtu)

Unit Utilization

×∑∑

F or the purposes of this calculat ion,the unit’s dispatch system will be thedispatch system as it existed as of No-vember 15, 1990.

(2) Al lowance Calcu la t ion . Allowancesunder this paragraph (f) shall be cal-culated as follows:

Unit AllowGreater of

ior year e ior year uances = 1.75 1990 emission rate or

mission rate tilization/2000−[ ]×Pr Pr

(3) A l l owance L oan . (i) T he number of allowances calculated under paragraph(f)(2) of this section shall be allocatedto the unit’s year 2000 subaccount.

(ii ) T he number of all owances cal-culated under paragraph (f)(2) of thissection shall be deducted, contempora-neously with the all ocation under para-graph (f)(3)(i) of this section, from theunit’s year 2015 subaccount.

(iii) Notwithstanding paragraph(f)(3)(ii) of this section, if the numberof al lowances to be deducted exceedsthe amount of allowances allocated tothe unit for the year 2015, allowancesin the year 2015 subaccount equal tothe amount of allowances allocated tothe unit for the year 2015 shall be de-ducted. In addition to the deductionfrom the year 2015 subaccount, a suffi-cient amount of allowances in the year



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2016 subaccount (up to the amount of all owances all ocated to the unit for theyear 2016) shal l be deducted cont em-poraneously, such that the sum of theallowances deducted from the sub-accounts equals the number of allow-ances required to be deducted underparagraph (f)(3)(ii) of this section.

(iv) Notwithstanding paragraph(f)(3)(ii) of this section, the procedurein paragraph (f)(3)(iii) shall be appliedas follows to each year after 2015 (year-by-year in numerical order) for whichthe number of allowances to be de-

ducted from that year’s subaccount ex-ceeds the number allocated to the unitfor that year: allowances equal to thenumber al located for t hat year shall bededucted from that year’s subaccountand the remainder (up to the amountallocated) necessary to equal the num-ber of allowances required to be de-ducted under paragraph (f)(3)(ii) of thissecti on shall be deducted from the nextyear’s subaccount.

(v) The owners and operat ors of theunit shall ensure that sufficient allow-ances are available to make the full de-

ductions required under paragraphs(f)(3)(ii), (iii), and (iv) of this section.

T he designat ed representat ive mayspecify the serial number of each al-lowance to be deducted.

(4) ERC Un i t s. Any unit to which al-lowances are allocated under paragraph(f)(3)(i) of this section shall be consid-ered an ERC unit for purposes of apply-ing the restrictions in paragraph (e)(6)of thi s secti on.

[58 F R 15711, Mar. 23, 1993, as amended at 62F R 34150, J une 24, 1997]

§ 73.21 Phase II repowering allow-ances.

(a) Repowerin g al l owa nces. In additionto al lowances all ocated under §73.10(b),the Administrator will allocate, toeach exist ing uni t (under §72.44(b)(1) of this chapter) with an approvedrepowering extension plan, allowancesfor use during the repowering exten-sion period approved under§72.44(f)(2)(ii) of this chapter (includinga prorated allocation for any fractionof a year) equal to:

where:

1995 SI P = M ost str ingent federal ly enforce-able State implementation plan SO2 emis-sions limitation for 1995.

1995 Actual Rate = 1995 actual SO2 emissionsrate

Unit’s Adjusted Basic Allowances are as list-ed in t he foll owing table

Unit

Year 2000adjusted

basic allow-ances

RE Burger 1 ....................................................... 1273RE Burger 2 ....................................................... 1245RE Burger 3 ....................................................... 1286RE Burger 4 ....................................................... 1316RE Burger 5 ....................................................... 1336RE Burger 6 ....................................................... 1332New Castle 1 ..................................................... 1334New Castle 2 ..................................................... 1485New Castle 3 ..................................................... 2935New Castle 4 ..................................................... 2686New Castle 5 ..................................................... 5481

(b) Upon commencement of commer-cial operation of a new unit (under§72.44(b)(2) of this chapter) with an ap-proved repowering extension plan, al-lowances for use during the repoweringextension period approved will end andallocations under §73.10(b) for the ex-isting unit will be transferred to thesubaccounts for the new unit.

(c)(1) I f t he designated representativefor a repowering unit terminates the

repowering extension plan in accord-ance with §72.44(g)(1) of this chapter,the repowering allowances allocated tothat unit by paragraph (a) of this sec-tion will be terminated and any nec-essary allowances from that unit’s ac-count forfeited, calculated in the fol-lowing manner:



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40 CFR Ch. I (7–1–00 Edition)§§ 73.22–73.24

where:

F orfeiture Peri od = difference (as a porti onof a year) between the end of the approvedrepowering extension and the end of therepoweri ng extensi on under §72.44(g)(1)(i i )

1995 SI P = M ost str ingent federal ly enforce-able State implementation plan SO2 emis-sions limitation for 1995.

1995 Actual Rate = 1995 actual SO2 emissionsrate

Unit’s Adjusted Basic Allowances are as list-ed in the table in paragraph (a) of this sec-tion.

(c)(2) The Administrator will reallo-cate any allowances forfeited in para-graph (c)(1) of this section with a com-pliance use date of 2000 or any allow-

ances remaining in the repowering re-serve to al l T able 2 uni ts’ years 2000through 2009 subaccounts in the fol-lowing manner:

Reallocation = Forfeited Repowering AllowancesUnit' s Deductions at Table 2 Column B

27124×

[53 F R 15713, M ar. 23, 1993, as amended at 63 FR 51765, Sept. 28, 1998]

§§73.22–73.24 [Reserved]

§ 73.25 Phase I extension reserve.

T he Administr ator wi l l ini t ial ly al lo-cate 3.5 million allowances to theP hase I Extension R eserve account of the Allowance Tracking System. Al-lowances from this Reserve will be al-located to units under §72.42 of thischapter. Allowances remaining in theP hase I Extension R eserve account fol -lowing allocation of all extension al-lowances under §72.42 of thi s chapterwil l r emain i n the Reserve.

[58 F R 3687, J an. 11, 1993]

§ 73.26 Conservation and renewableenergy reserve.

T he Administr ator wi l l al locate300,000 allowances to the Conservation

and Renewable Energy R eserve sub-account of the Acid Rain Data System.Allowances from this Reserve will beall ocated to unit s under subpart F of this part. Termination of this Reserveand reallocation of allowances will bemade under §73.80(c).

[53 F R 15714, Mar . 23, 1993]

§ 73.27 Special allowance reserve.

(a) Establ ishment of R eserve. (1) T heAdministrator will allocate 150,000 al-lowances annually for calendar years1995 through 1999 to t he Auct ion Sub-account of the Special Allowance Re-serve.

(2) The Administrator will allocate250,000 al lowances annual ly for cal-endar year 2000 and each year there-after to the Auction Subaccount of theSpecial Allowance Reserve.

(b) Distr ibut ion of proceeds. (1) M one-tary proceeds from the auctions andsales of allowances from the SpecialAllowance Reserve (under subpart E of this part) for use in calendar years 1995through 1999 will be distributed to thedesignated representative of the unitaccording to the foll owing equati on:

unit proceeds = (Column B of table 1 of

section 73.10/150,000) × total proceeds(2) Until J une 1, 1998, monetary pro-

ceeds from the auctions of allowancesfrom the Special Allowance Reserve(under subpart E of thi s part ) for use incal endar years 2000 through 2009 wi l l bedistributed to the designated rep-resentat ive of each unit li sted in T able2 according to the following equation:



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Units Proceeds =Unit's Deduction Table 2 Column D

250,000eeds

× Total Proc

(3) On or after J une 1, 1998, monetaryproceeds from the auctions of allow-ances from the Special Allowance Re-serve (under subpart E of this part) foruse in cal endar years 2000 through 2009

will be distributed to the designatedrepresentative of each unit listed in

T able 2 according to the fol lowingequation:

Unit Proceeds = Unit's Deduction at Table 2 Column A250,000

eeds

×Total Proc

(4) Monetary proceeds from the auc-tions of allowances from the SpecialAllowance Reserve (under subpart E of this part) from years of purchase from1993 through 1998, remaining in t he U.S .

T reasury as a result of t he surr ender of

allowances and return of proceedsunder §73.10(b)(3), will be distributed tothe designated representative of eachunit li sted in T able 2 according to t hefoll owing equati on:

Unit Proceeds =Unit's Deduction at Table 2 Column D

250,000Remaining Proceeds

×

(5) Monetary proceeds from the auc-tions of allowances from the SpecialAllowance Reserve (under subpart E of this part) for use in calendar years 2010

and thereafter will be distributed tothe designated representative of eachunit li sted in T able 2 according to t hefoll owing equati on:

Unit Proceeds =Unit's Deduction at Table 2 Column E

250,000eeds

×Total Proc

(c) Real loca t ion of a l low ances. (1) Al-lowances remaining in the Special Al-lowance Reserve following the annualauctions and sales (under subpart E of this part) for use in calendar years 1995through 1999 will be reallocated to theunit’s Allowance Tracking System Ac-count according to the following equa-tion:

uni t al lowances = (Column B of table 1of sect ion 73.10/150,000) × Allowancesremaining

(2) Unti l J une 1, 1998, al lowances, foruse in calendar years 2000 through 2009,remaining in the Special Allowance

Reserve at the end of each year, fol-lowing that year’s auction (under sub-part E of this part), will be reallocatedto the unit’s Allowance Tracking Sys-tem account according to the foll owingequation:



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40 CFR Ch. I (7–1–00 Edition)§ 73.30

Unit Allowances =Unit's Deduction at Table 2 Column D

250,000Allowances Remaining

×

(3) On or after J une 1, 1998, al low-ances, for use in calendar years 2000through 2009, remaining in the SpecialAllowance Reserve at the end of eachyear, following that year’s auction

(under subpart E of this part), will bereallocated to the unit’s Allowance

T rack ing System account according t othe foll owing equati on:

Unit Allowances = Unit's Deduction at Table 2 Column A250,000

Allowances Remaining

×

(4)[R eserved](5) A ll owances, for use in cal endar

years 2010 and thereafter, remaining inthe Special Allowance Reserve at theend of each year, following that year’s

auction (under subpart E of this part),will be reallocated to the unit’s Allow-ance T rack ing System account accord-ing to t he foll owing equati on:

Unit Allowances =Unit's Deduction at Table 2 Column E

250,000Allowances Remaining

×

(d) Ca lcu la t i on round ing . A ll proceedsunder this section shall be distributedas whole dollars. All calculations forsuch allowances shall be rounded downfor decimals less than .5 and up fordecimal s of .5 or greater.

(e) Ach i ev in g exact to ta ls . (1) If t hesum of the proceeds to be distributedunder paragraph (b) of this section ex-ceeds the total proceeds or the allow-ances to be reallocated under para-graph (c) of this section exceeds the al-lowances remaining, then t he Admini s-trator will withdraw one dollar or al-lowance from each unit , beginning wit hthe unit receiving the largest number

of dollars or allowances, in descendingorder, until the distribution balanceswith the proceeds and the reallocatedall owances balance with t he remaini ngallowances.

(2) I f the sum of the proceeds to bedistributed under paragraph (b) of thissection is less than the total proceedsor the allowances to be reallocatedunder paragraph (c) of this section isless than the allowances remaining,

then EPA will distribute one dollar orall owance for each unit , beginning wit hthe unit receiving the largest numberof dollars or allowances, in descendingorder, until the distribution balanceswith the proceeds and the reallocatedall owances balance with t he remaini ngallowances.

[58 F R 3687, J an. 11, 1993, as amended at 58F R 15714, M ar . 23, 1993; 63 F R 51765, S ept. 28,1998]

Subpart C—Allowance TrackingSystem


§ 73.30 Allowance tracking system ac-counts.

(a) Na tu re and func t i on o f un i t ac - counts. T he Administr ator wi l l estab-lish accounts for all affected units pur-suant to §73.31 (a) and (b). Al l al loca-tions of allowances pursuant to sub-part s B, E, and F of thi s part and part



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72 of this chapter, transfers of allow-ances made pursuant to subparts C andD, and deductions of allowances madefor purposes of offsetting emissionspursuant to §73.35 (b) and (d) and parts72, 75, and 77 of t hi s chapter wi l l be re-corded in the unit’s Allowance Track-ing System account.

(b) Natu re and fun c t ion of genera l accounts. T ransfers of al lowances held forany person other than an affected unit,made pursuant to subpart s C, D, E, F ,and G of this part will be recorded inthat person’s Allowance Tracking Sys-

tem account established pursuant to§73.31(c).

[58 F R 3687, J an. 11, 1993; 58 F R 40747, J ul y 30,1993]

§ 73.31 Establishment of accounts.

(a) Ex is t ing af fected un i ts . T he Admin-istrator will establish an Allowance

T rack ing System account and al locateallowances for each unit that is, or willbecome, an existing affected unit pur-suant to sections 404(a) or 405 of theAct and §72.6 of t his chapter.

(b) New un i ts . Upon receipt of a com-plete certificate of representation forthe designated representative for a newunit pursuant to part 72, subpart B of this chapter, the Administrator wil l es-tablish an Al lowance T racki ng Systemaccount for t he unit .

(c) General accounts. (1) Any personmay apply to open an Allowance

T rack ing System account for the pur-pose of holding and transferring allow-ances. Such application shall be sub-mitted to the Administrator in a for-mat to be specified by the Adminis-trator by means of the Allowance Ac-count I nformati on Form, or by pro-viding the following information in asimilar format:

(i) Name and title of the authorizedaccount representative and alternateauthorized account representative (if any) pursuant to §73.33;

(ii) Mailing address, telephone num-ber and facsimile transmission number(if any) of the authorized account rep-resentative and alternate authorizedaccount representative (if any);

(iii) Organization or company name(if applicable) and type of organizati on(if applicable);

(iv) A list of all persons subject to abinding agreement for the authorized

account representative to representtheir ownership interest with respectto the allowances held in the generalaccount and which shall be amendedand resubmitted within 30 days fol-lowing any transaction giving rise toany change of the list of persons sub-

ject t o the bindi ng agreement;(v) A certification statement by the

authorized account representative andalternate authorized account rep-resentative (if any) that reads ‘‘I cer-tify that I was selected under theterms of an agreement that is binding

on all persons who have an ownershipinterest with respect to allowancesheld in the Allowance Tracking Systemaccount. I certify that I have all nec-essary authority to carry out my du-ties and responsibilities on behalf of the persons with an ownership interestand that they shall be fully bound bymy actions, inactions, or submissionsunder 40 CF R part 73. I shall abide byany fiduciary responsibilities assignedpursuant to the binding agreement. Iam authori zed to mak e this submissionon behalf of the persons with an owner-ship interest for whom this submissionis made. I certify under penalty of lawthat I have personally examined and

am familiar with the information sub-mitted in this document and all its at-tachments. Based on my inquiry of those individuals with primary respon-sibil it y for obtaini ng the information, Icertify that the information is to thebest of my k nowledge and beli ef true,accurate, and complete. I am awarethat there are significant penalties forsubmitting false material information,or omitting material information, in-cluding the possibility of fine or im-prisonment for violations.’’;

(vi) T he signature of the authori zedaccount representative and the alter-nate authorized account representative(if any); and

(vii ) T he date of the signature of theauthorized account representative andthe alternate authorized account rep-resentat ive (if any).

(2) Upon receipt of such complete ap-plication, the Administrator will estab-lish an Allowance Tracking System ac-count for the person or persons identi-fied in the applicat ion.

(3) No allowance transfers will be re-corded for a general account until the



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Administrator has established the newaccount.

(d) Account iden t i f i ca t ion . T he A dmin-istrator will assign a unique identi-fying number to each account estab-li shed pursuant to thi s secti on.

[58 F R 3687, J an. 11, 1993; 58 F R 40747, J ul y 30,1993]

§ 73.32 Allowance account contents.

Each allowance account will include,at a minimum, the following:

(a) The name, address, telephone

number and facsimile transmissionnumber, if any, of the authorized ac-count representative; and

(1) In the case of a uni t account , alist of all persons identified as ownersof record of the unit in §72.24(a)(3) of thi s chapter, or

(2) I n the case of a general account, alist of all persons subject to the bind-ing agreement for the authorized ac-count representative to represent theirownership interest with respect to al-lowances, as identified in accordancewi th §73.31(c);

(b) A list of transfers of allowancesto, and from, the account, includingthe identity of the transferror and

transferee accounts;(c) In the case of a unit account foran existing affected unit, beginning in1995, a compl iance subaccount ;

(d) In the case of a unit account fora new unit, a compliance subaccount;

(e) In t he case of a general account , acurrent year subaccount;

(f) F uture year subaccounts for eachof the 30 calendar years following thelater of 1995 or the current calendaryear;

(g) In the case of a unit account, thecurrent total of sulfur dioxide emis-sions in tons for the current calendaryear as reported to date pursuant topart 75 of this chapter.

[58 F R 3687, J an. 11, 1993; 58 F R 40747, J ul y 30,1993]

§ 73.33 Authorized account representa-tive.

(a) Foll owing the establishment of anAllowance Tracking System account,all matters pertaining to the account,including, but not limited to, the de-duction and transfer of allowances inthe account, shall be undertaken only

by the authorized account representa-tive.

(b) Author ized account representa t ive iden t i f i ca t ion . T he Administr ator wi l lassign a unique identifying number toeach authorized account representativeor alternate authorized account rep-resentative identified pursuant to§73.31(c).

(c) Not i f i ca t ion of par t i es sub ject t o the binding agreement. T he authorized ac-count representative for a general ac-count shall notify, in writing, all per-sons who have an ownership interestwith respect to the allowances held inthe account of any Acid Rain P rogramsubmission required by this part or ina procedure under part 78 of this chap-ter, by the date of submission. Eachperson who has an ownership interestwith respect to the allowances held inthe account may expressly waive his orher r ight t o receive such noti ficat ion.

(d) Genera l account a l te rna te author - ized accoun t r epresent at i ve. Any applica-tion for opening a general account maydesignate one alternate authorized ac-count representative to act on behalf of the certifying authorized account rep-resentative, in the event the author-

ized account representative is absentor otherwise not available to performactions and duti es under thi s part . T healternate shall be a natural person andshall be authorized, provided that theconditions and procedures specified in§73.31(c)(1) are met.

(1) The alt ernate author ized accountrepresentative may be changed at anytime by the authorized account rep-resentative upon receipt by the Admin-istrator of a new complete applicationas required in §73.31(c);

(2) The alt ernate author ized accountrepresentative shall be subject to theprovisions of thi s part appli cable to au-thorized account representatives;

(3) Whenever the term ‘‘authorizedaccount representat ive’’ i s used in thi spart it shall be construed to includethe alternate authorized account rep-resentative, unless such a constructionwould be illogical from the context;and

(4) Any acti on, representat ion or fail -ure to act by the alternate authorizedaccount representative when acting inthat capacity shall be deemed to be an



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action of the authorized account rep-resentative, with all the rights, duties,and responsibil it ies pert aining thereto.

(e) Chan ges to th e general accoun t au - thor ized account representat ive. An au-thorized account representative for ageneral account may be succeeded byany person who submits an applicationpursuant t o §73.31(c). T he acti ons of anauthorized account representative for ageneral account shall be binding onany successor.

(f) Object ions to t he aut hor ized account representat ive. Except for a certifi-cation pursuant t o paragraph (e) of thi ssection, no objection or other commu-nication submitted to the Adminis-trator concerning any submission tothe Administrator by the authorizedaccount representative shall affect therecordation of transfers submitted bythe authorized account representativepursuant to subpart D of this part. Nei-ther the United States, the Adminis-trator, nor any permitting authoritywill adjudicate any dispute betweenand among persons concerning any sub-mission to the Administrator by theauthorized account representative; anyactions of the authorized account rep-

resentative; or any other matter aris-ing directl y or indirectl y from the cer-ti ficat ion, actions or representat ions of the authorized account representative.

§ 73.34 Recordation in accounts.

(a) Recordat ion in compl iance subaccounts. At the beginning of 1995 and, inthe case of each year thereafter, afterthe Administrator has made all deduc-tions from an affected unit’s compli-ance subaccount pursuant to §73.35(b),the Administrator will record in thecompliance subaccount the allowancesheld in the future year subaccount forthe year corresponding to the currentcalendar year. The future year sub-

account for the new 30th year will beestablished at the same time and in-clude the allowances allocated for theunit for that year pursuant to subpartB of thi s part.

(b) Recorda t ion in cur ren t year subaccounts. At the beginning of 1995 andeach year thereafter, the Adminis-trator will record in the current yearsubaccount the allowances held in thefuture year subaccount for the year

corresponding to the current calendaryear.

(c) Recorda t i on in subaccount s. Allow-ances in each compliance, current year,and future year subaccounts will re-flect:

(1) All allowances allocated or de-ducted for the unit for the year pursu-ant to subpart B of thi s part ;

(2) All allowances allocated or de-ducted pur suant to §§72.41, 72.42, 72.43,and 72.44 and part 74 of thi s chapter;

(3) All allowances allocated pursuantto subpart s F and G of thi s part ;

(4) All allowances recorded as a re-sult of purchases or returns from theannual auctions;

(5) All allowances recorded or de-ducted as a result of allowance trans-fers recorded pursuant to subpart D of thi s part ; and

(6) All allowances deducted or re-turned pur suant to §§73.35(d), 72.91 and72.92, part 74, and part 77 of t hi s chap-ter.

(d) Ser ia l nu mbers for a l loca ted a l lowances. Upon the allocation of allow-ances to an account, including allow-ances contained in r eserves as providedin subpart B of this part, the Adminis-

trator will assign each allowance aunique identification number that willinclude digits identifying the allow-ance’s compliance use date.

[58 F R 3691, J an. 11, 1993, as amended at 60F R 17114, Apr. 4, 1995; 63 FR 68404, D ec. 11,1998]

§ 73.35 Compliance.

(a) Al lowan ce t ran sfe r dead l in e. No al-lowance shall be deducted for purposesof compliance with an affected unit’ssulfur dioxide Acid Rain emissions lim-itation requirements pursuant to titleIV of the Act and paragraph (b) of thissecti on unless:

(1) T he compli ance use date of t he al-

lowance is no later than the year inwhich the unit’s SO2 emissions oc-curred; and

(2) Such all owance is:(i) Recorded in the unit’s compliance

subaccount; or(ii) Transferred to the unit’s compli-

ance subaccount, with the transfer sub-mitted correctly pursuant to subpart Dof this part for recordation in the com-pliance subaccount for the unit by not



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later than the allowance transfer dead-line in the calendar year following theyear for which compliance is being es-tablished; or

(iii) Held in the compliance sub-account of another affected unit at thesame source in accordance with para-graph (b)(3) of this secti on.

(b) Deduct ions for compl iance. (1) Ex-cept as provided in paragraph (d) of this section, following the recordationof transfers submitted correctly forrecordation in the compliance sub-account pursuant to paragraph (a) of this section and subpart D of this part,the Administrator will deduct allow-ances from each affected unit’s compli-ance subaccount in accordance withthe allowance deduction formula in§72.95 of this chapter, or, for opt-insources, the allowance deduction for-mula in §74.49 of this chapter, and anycorrection made under §72.96 of thischapter.

(2) The Administrator will make de-ductions until either the number of al-lowances deducted is equal to theamount calculated in accordance with§72.95 of this chapter, or, for opt-insources, in accordance wit h §74.49 of

this chapter, as modified under §72.96of this chapter or until no more allow-ances remain in the compliance sub-account.

(3)(i) If, after the Administrator com-pletes the deductions under paragraph(b)(2) of this section for all affectedunits at the same source, a unit wouldotherwise have excess emissions andone or more other affected units at thesource would otherwise have unused al-lowances in their compliance sub-accounts and available for such otherunits under paragraph (a)(1) and(a)(2)(i) and (ii) of this section for theyear for which compliance is being es-tablished, the Administrator will no-

tify in writing the authorized accountrepresentative. The Administrator willstate that the authorized account rep-resentative may specify in writingwhich of such allowances to deduct upto the amount calculated as follows, inorder t o reduce the tons of excess emis-sions otherwise at t he unit :

Maximum deducti on from other unit s =0.95 × Excess emissions i f no deduc-ti on from other unit s

Where:‘‘Maximum deduction from other uni ts’’ i s

the maximum number of allowances thatmay be deducted for the year for whichcompliance is being established, for theunit otherwise having excess emissions,from the compliance subaccounts of otherunits at the same source, rounded to thenearest allowance.

‘‘Excess emissions i f no deduction from otherunits’’ is the tons of excess emissions thatthe unit would otherwise have if no allow-ances were deducted for the unit fromother units under this paragraph (b)(3)(i) orparagraph (b)(3)(ii) of this section.

(ii) Notwithstanding paragraph(b)(3)(i) of this section, if the amountcalculated results in less than 10 tonsof excess emissions, the maximum de-duction from other units shall be ad-

justed so that 10 tons of excess emis-sions, or the tons of excess emissionsthat would result if no allowancescould be deducted from other units,whichever is less, remain for the unit.

(iii) If the authorized account rep-resentative submits within 15 days of receipt of a notification under para-graph (b)(3)(i) of this section a writtenrequest specifying allowances to de-duct in accordance with paragraphs(b)(3)(i) and (ii) of this section, the Ad-

ministrator will deduct such allow-ances, and reduce the tons of excessemissions otherwise at the unit by anequal amount, up to the amount cal-culated under paragraphs (b)(3)(i) and(ii ) of this secti on.

(c)(1) Id en t i f i ca t i on of a l lowan ces by se- r ia l nu mber . By no later t han sixty daysafter the end of the calendar year, theauthorized account representative foreach unit account may identify by se-rial number the allowances to be de-ducted from the compliance sub-account for purposes of compliancewith the unit’ s sulfur dioxide emissionslimitation requirements. Such identi-ficati on shall be made pursuant t o part

72 of this chapter.(2) Fi r st - in , f i r st -ou t . I n the absence of

an identification or in the case of apartial identification of allowances byserial number, as provided for in para-graph (b)(1) or (d) of this section, theAdministrator will deduct allowanceson a first-i n, first-out (FI F O) account-ing basis beginning with those allow-ances with the earliest compliance usedate originally allocated for the unit



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and recorded in its compliance sub-account. F oll owing the deducti on of alloriginally allocated allowances fromthe compliance subaccount, the Ad-ministrator will deduct those allow-ances that were transferred and re-corded in the unit’s compliance sub-account pursuant to subpart D of thispart, beginning with those with theearl iest date of recordati on.

(d) D educt ion s for excess emissions.P ursuant to §77.4 of this chapter, andfollowing the process of recordation setforth in §73.34(a) of this part, the Ad-

ministrator will deduct allowances foreach unit with excess emissions for thepreceding calendar year in an amountequal to the unit’s excess emissionstonnage.

(e) Deduct ions for un i ts shar ing a common emission stack . I n the case of unit ssharing a common emission stack andhave emissions that are not individ-ually monitored pursuant to part 75 of this chapter, the authorized accountrepresentative may identify the per-centage of allowances to be deductedfrom each unit’s compliance sub-account. Such identification shall bemade pursuant to part 72, subpart I of this chapter. I n the absence of an iden-

tification, the Administrator will de-duct an equal percentage of allowancesfrom each unit’s compliance sub-account.

[58 F R 3691, J an. 11, 1993, as amended at 60F R 17114, A pr. 4, 1995; 64 F R 25842, May 13,1999]

§73.36 Banking.

(a) Un i t account s. Any allowance in acompliance subaccount not deductedpursuant to §73.35 will remain in thecompliance subaccount.

(b) General a ccoun ts. In the case of ageneral account, any allowances in thecurrent year subaccount at the end of the current calendar year will remain

in the current year subaccount.

§ 73.37 Account error and dispute reso-lution.

(a) Cla im of er ro r . T he authorized ac-count representative may notify theAdministrator of any claim that theAdministrator made an error in record-ing transfer information that was sub-mitted correctly pursuant to subpart Dof this part, provided that such claim

of error notification is submitted tothe Administrator by no later than 15business days following the date markof the notification by the Adminis-trator pursuant to actions taken under§73.37(d) or §73.53. Such claim of errornotification shall be in writing andshall include:

(1) A description of the error allegedto have been made by t he Adminis-trator;

(2) A proposed correction of the al-leged error ;

(3) Any support ing documentati on or

other information concerning the al-leged error and proposed correction;and

(4) Certification by the signature of and the date of the signature of the au-thorized account representative.

T he Administr ator wi l l not act onclaim of error notifications receivedafter the stated deadlines (except asprovided under paragraph (f) of thissection, or that do not contend thatthe Administrator made an error inrecordation.

(b) EPA ac t i on . T he Administr ator, atthe Administrator’s sole discretionbased on documentation provided, willdetermine what changes, if any, will bemade to the accounts subject to the al-leged error. Not later than 20 businessdays after receipt of a claim of errornotification pursuant to paragraph (a)of this section, the Administrator willsubmit to the authorized account rep-resentative a written response stating:

(1) T he determinati on made and anyaction taken by, the Administrator;and

(2) T he reasons for such acti on.(c) Admin is t ra t ive appea ls procedure .

F ollowing the Administr ator’s actionpursuant to paragraph (b) of this sec-tion, the authorized account represent-ative may appeal the Administrator’saction through the administrative ap-

peals procedure pursuant to part 78 of thi s chapter.

(d) EPA cor rec t ions . T he Adminis-trator may, without prior notice of aclaim of error and in the Administra-tor’s sole discretion, correct any errorsin any account on his or her own mo-tion. The Administrator will notify theauthorized account representative byno later than 20 business days fol-lowing any such corrections.



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40 CFR Ch. I (7–1–00 Edition)§ 73.38

(e) Ex cess emission s requi rement s. T hefiling of a claim of error notificationpursuant to paragraph (a) of this sec-ti on, or the pendency of the Adminis-trator’s action pursuant to paragraph(b) of this section, shall not affect aunit’s obligations under part 77 of thischapter.

(f) Wai ver o f dead l ine . T he Adminis-trator may, in his or her discretion, ac-cept claim of error submissions madefoll owing the deadli nes imposed in thi ssection upon a demonstration by theauthorized account representative of good cause for t he delay. T he finding of whether good cause exists shall be inthe sole discretion of the Adminis-tr ator. A ppeals of a decision by t he Ad-ministrator under this paragraph willbe addressed pursuant to the adminis-trative appeals process in part 78 of thi s chapter.

§ 73.38 Closing of accounts.

(a) General account. T he authorizedaccount representative of a general ac-count may instruct the Administratorto close the general account by submit-ting an allowance transfer, pursuant to§73.50 and §73.52, r equesti ng t he t rans-

fer of all allowances held in the ac-count to one or more other accounts inthe Allowance Tracking System, andby submit ti ng in writ ing, wit h the sig-nature of the authorized account rep-resentative, a request to delete thegeneral account from the Allowance

T rack ing System.(b) In ac t ive account s. If a general ac-

count shows no activity for a period of a year or more and does not containany allowances in its subaccounts, theAdministrator will notify the account’sauthorized account representative thatthe account will be closed and elimi-nated from the Allowance TrackingSystem fol lowi ng 20 business days from

the date the noti ce is sent. T he ac-count will be closed following the 20-day period, unless the Administratorreceives and records a request for thetr ansfer of al lowances int o the accountpursuant to §73.52 before the end of the20-day period, or the authorized ac-count representative submits, in writ-ing, demonstration of good cause as towhy the inactive account should not beclosed. T he finding of whether good

cause exists shall be in the sole discre-ti on of the Administrator.

Subpart D—Allowance Transfers


§ 73.50 Scope and submission of trans-fers.

(a) Scope of transfers. E xcept as pro-vided in §73.51 and §73.52, the Adminis-trator will record transfers of an allow-

ance to and from Allowance TrackingSystem accounts, including, but notlimited to, transfers of an allowance toand from contemporaneous future yearsubaccounts, and transfers of an allow-ance to and from compliance subac-counts and current year subaccounts,and transfers of all allowances allo-cated for a unit for each calendar year,in perpetuity.

(b) Submission of tr an sfers. (1) Author-ized account representatives seeki ngrecordation of an allowance transfershall request such transfer by submit-ting to the Administrator, in a formatto be specified by the Administrator,an Al lowance T ransfer F orm. To be

considered correctly submitted the re-quest for tr ansfer shall include:(i) T he numbers identi fyi ng both the

transferror and transferee accounts;(ii) A specification by serial number

of each allowance to be transferred, orcorrect indication on the allowancetransfer where a request involves thetr ansfer of the unit ’s all owances in per-petuity;

(iii) Signatures of the authorized ac-count representatives of both thetransferror and transferee accounts;

(iv) T he dates of the signatures of theauthorized account representatives;

(v) The numbers i denti fyi ng the au-thorized account representatives for

both the transferror and transferee ac-count; and

(vi) Where the transferee account hasnot been established, information asrequired pursuant to §73.31 (b) or (c).

(2)(i) T he authori zed account rep-resentative for the transferee accountcan meet the requirements in para

40 Cfr Part 73-Sulfur Dioxide Allowance System

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