42 U.S.C. § 7651c — Phase I sulfur dioxide requirements

Page 7418 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651c 2 See References in Text note below. (h) Competitive bidding for power supply Nothing in this subchapter shall be construed to interfere with or impair any program for competitive bidding for power supply in a State in which such program is established. (i) Applicability of antitrust laws (1) Nothing in this section affects— (A) the applicability of the antitrust laws to the transfer, use, or sale of allowances, or (B) the authority of the Federal Energy Reg- ulatory Commission under any provision of law respecting unfair methods of competition or anticompetitive acts or practices. (2) As used in this section, ‘‘antitrust laws’’ means those Acts set forth in section 12 of title 15. (j) Public Utility Holding Company Act The acquisition or disposition of allowances pursuant to this subchapter including the issuance of securities or the undertaking of any other financing transaction in connection with such allowances shall not be subject to the pro- visions of the Public Utility Holding Company Act of 1935.2 (July 14, 1955, ch. 360, title IV, § 403, as added Pub. L. 101–549, title IV, § 401, Nov. 15, 1990, 104 Stat. 2589.) Editorial Notes REFERENCES IN TEXT The Federal Power Act, referred to in subsec. (f), is act June 10, 1920, ch. 285, 41 Stat. 1063, which is classi- fied generally to chapter 12 (§ 791a et seq.) of Title 16, Conservation. For complete classification of this Act to the Code, see section 791a of Title 16 and Tables. The Public Utility Holding Company Act of 1935, re- ferred to in subsec. (j), is title I of act Aug. 26, 1935, ch. 687, 49 Stat. 803, which was classified generally to chap- ter 2C (§ 79 et seq.) of Title 15, Commerce and Trade, prior to repeal by Pub. L. 109–58, title XII, § 1263, Aug. 8, 2005, 119 Stat. 974. For complete classification of this Act to the Code, see Tables. CODIFICATION Another section 403 of act July 14, 1955, as added by Pub. L. 91–604, § 14, Dec. 31, 1970, 84 Stat. 1710, is classi- fied to section 7642 of this title. Statutory Notes and Related Subsidiaries FOSSIL FUEL USE Pub. L. 101–549, title IV, § 402, Nov. 15, 1990, 104 Stat. 2631, provided that: ‘‘(a) CONTRACTS FOR HYDROELECTRIC ENERGY.—Any person who, after the date of the enactment of the Clean Air Act Amendments of 1990 [Nov. 15, 1990], en- ters into a contract under which such person receives hydroelectric energy in return for the provision of elec- tric energy by such person shall use allowances held by such person as necessary to satisfy such person’s obli- gations under such contract. ‘‘(b) FEDERAL POWER MARKETING ADMINISTRATION.—A Federal Power Marketing Administration shall not be subject to the provisions and requirements of this title [enacting this subchapter, amending sections 7410, 7411, and 7479 of this title, and enacting provisions set out as notes under sections 7403, 7411, and 7651 of this title] with respect to electric energy generated by hydro- electric facilities and marketed by such Power Mar- keting Administration. Any person who sells or pro- vides electric energy to a Federal Power Marketing Ad- ministration shall comply with the provisions and re- quirements of this title.’’ § 7651c. Phase I sulfur dioxide requirements (a) Emission limitations (1) After January 1, 1995, each source that in- cludes one or more affected units listed in table A is an affected source under this section. After January 1, 1995, it shall be unlawful for any af- fected unit (other than an eligible phase I unit under subsection (d)(2)) to emit sulfur dioxide in excess of the tonnage limitation stated as a total number of allowances in table A for phase I, unless (A) the emissions reduction require- ments applicable to such unit have been achieved pursuant to subsection (b) or (d), or (B) the owner or operator of such unit holds allow- ances to emit not less than the unit’s total an- nual emissions, except that, after January 1, 2000, the emissions limitations established in this section shall be superseded by those estab- lished in section 7651d of this title. The owner or operator of any unit in violation of this section shall be fully liable for such violation including, but not limited to, liability for fulfilling the ob- ligations specified in section 7651j of this title. (2) Not later than December 31, 1991, the Ad- ministrator shall determine the total tonnage of reductions in the emissions of sulfur dioxide from all utility units in calendar year 1995 that will occur as a result of compliance with the emissions limitation requirements of this sec- tion, and shall establish a reserve of allowances equal in amount to the number of tons deter- mined thereby not to exceed a total of 3.50 mil- lion tons. In making such a determination, the Administrator shall compute for each unit sub- ject to the emissions limitation requirements of this section the difference between: (A) the product of its baseline multiplied by the lesser of each unit’s allowable 1985 emis- sions rate and its actual 1985 emissions rate, divided by 2,000, and (B) the product of each unit’s baseline multi- plied by 2.50 lbs/mmBtu divided by 2,000, and sum the computations. The Administrator shall adjust the foregoing calculation to reflect projected calendar year 1995 utilization of the units subject to the emissions limitations of this subchapter that the Administrator finds would have occurred in the absence of the impo- sition of such requirements. Pursuant to sub- section (d), the Administrator shall allocate al- lowances from the reserve established hereinunder until the earlier of such time as all such allowances in the reserve are allocated or December 31, 1999. (3) In addition to allowances allocated pursu- ant to paragraph (1), in each calendar year be- ginning in 1995 and ending in 1999, inclusive, the Administrator shall allocate for each unit on Table A that is located in the States of Illinois, Indiana, or Ohio (other than units at Kyger Creek, Clifty Creek and Joppa Steam), allow- ances in an amount equal to 200,000 multiplied by the unit’s pro rata share of the total number of allowances allocated for all units on Table A in the 3 States (other than units at Kyger Creek, Page 7419 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651c 1 So in original. Probably should be section ‘‘7651a(4)’’. 2 So in original. Probably should be ‘‘unit’s’’. Clifty Creek, and Joppa Steam) pursuant to paragraph (1). Such allowances shall be excluded from the calculation of the reserve under para- graph (2). (b) Substitutions The owner or operator of an affected unit under subsection (a) may include in its section 7651g of this title permit application and pro- posed compliance plan a proposal to reassign, in whole or in part, the affected unit’s sulfur diox- ide reduction requirements to any other unit(s) under the control of such owner or operator. Such proposal shall specify— (1) the designation of the substitute unit or units to which any part of the reduction obli- gations of subsection (a) shall be required, in addition to, or in lieu of, any original affected units designated under such subsection; (2) the original affected unit’s baseline, the actual and allowable 1985 emissions rate for sulfur dioxide, and the authorized annual al- lowance allocation stated in table A; (3) calculation of the annual average ton- nage for calendar years 1985, 1986, and 1987, emitted by the substitute unit or units, based on the baseline for each unit, as defined in sec- tion 7651a(d) 1 of this title, multiplied by the lesser of the unit’s actual or allowable 1985 emissions rate; (4) the emissions rates and tonnage limita- tions that would be applicable to the original and substitute affected units under the substi- tution proposal; (5) documentation, to the satisfaction of the Administrator, that the reassigned tonnage limits will, in total, achieve the same or greater emissions reduction than would have been achieved by the original affected unit and the substitute unit or units without such sub- stitution; and (6) such other information as the Adminis- trator may require. (c) Administrator’s action on substitution pro- posals (1) The Administrator shall take final action on such substitution proposal in accordance with section 7651g(c) of this title if the substi- tution proposal fulfills the requirements of this subsection. The Administrator may approve a substitution proposal in whole or in part and with such modifications or conditions as may be consistent with the orderly functioning of the allowance system and which will ensure the emissions reductions contemplated by this sub- chapter. If a proposal does not meet the require- ments of subsection (b), the Administrator shall disapprove it. The owner or operator of a unit listed in table A shall not substitute another unit or units without the prior approval of the Administrator. (2) Upon approval of a substitution proposal, each substitute unit, and each source with such unit, shall be deemed affected under this sub- chapter, and the Administrator shall issue a per- mit to the original and substitute affected source and unit in accordance with the approved substitution plan and section 7651g of this title. The Administrator shall allocate allowances for the original and substitute affected units in ac- cordance with the approved substitution pro- posal pursuant to section 7651b of this title. It shall be unlawful for any source or unit that is allocated allowances pursuant to this section to emit sulfur dioxide in excess of the emissions limitation provided for in the approved substi- tution permit and plan unless the owner or oper- ator of each unit governed by the permit and ap- proved substitution plan holds allowances to emit not less than the units 2 total annual emis- sions. The owner or operator of any original or substitute affected unit operated in violation of this subsection shall be fully liable for such vio- lation, including liability for fulfilling the obli- gations specified in section 7651j of this title. If a substitution proposal is disapproved, the Ad- ministrator shall allocate allowances to the original affected unit or units in accordance with subsection (a). (d) Eligible phase I extension units (1) The owner or operator of any affected unit subject to an emissions limitation requirement under this section may petition the Adminis- trator in its permit application under section 7651g of this title for an extension of 2 years of the deadline for meeting such requirement, pro- vided that the owner or operator of any such unit holds allowances to emit not less than the unit’s total annual emissions for each of the 2 years of the period of extension. To qualify for such an extension, the affected unit must either employ a qualifying phase I technology, or transfer its phase I emissions reduction obliga- tion to a unit employing a qualifying phase I technology. Such transfer shall be accomplished in accordance with a compliance plan, sub- mitted and approved under section 7651g of this title, that shall govern operations at all units included in the transfer, and that specifies the emissions reduction requirements imposed pur- suant to this subchapter. (2) Such extension proposal shall— (A) specify the unit or units proposed for designation as an eligible phase I extension unit; (B) provide a copy of an executed contract, which may be contingent upon the Adminis- trator approving the proposal, for the design engineering, and construction of the quali- fying phase I technology for the extension unit, or for the unit or units to which the ex- tension unit’s emission reduction obligation is to be transferred; (C) specify the unit’s or units’ baseline, ac- tual 1985 emissions rate, allowable 1985 emis- sions rate, and projected utilization for cal- endar years 1995 through 1999; (D) require CEMS on both the eligible phase I extension unit or units and the transfer unit or units beginning no later than January 1, 1995; and (E) specify the emission limitation and num- ber of allowances expected to be necessary for annual operation after the qualifying phase I technology has been installed. (3) The Administrator shall review and take final action on each extension proposal in order Page 7420 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651c 3 So in original. Probably should be ‘‘this’’. 4 So in original. Probably should be ‘‘paragraph (1)’’. of receipt, consistent with section 7651g of this title, and for an approved proposal shall des- ignate the unit or units as an eligible phase I ex- tension unit. The Administrator may approve an extension proposal in whole or in part, and with such modifications or conditions as may be nec- essary, consistent with the orderly functioning of the allowance system, and to ensure the emis- sions reductions contemplated by the 3 sub- chapter. (4) In order to determine the number of pro- posals eligible for allocations from the reserve under subsection (a)(2) and the number of allow- ances remaining available after each proposal is acted upon, the Administrator shall reduce the total number of allowances remaining available in the reserve by the number of allowances cal- culated according to subparagraphs (A), (B) and (C) until either no allowances remain available in the reserve for further allocation or all ap- proved proposals have been acted upon. If no al- lowances remain available in the reserve for fur- ther allocation before all proposals have been acted upon by the Administrator, any pending proposals shall be disapproved. The Adminis- trator shall calculate allowances equal to— (A) the difference between the lesser of the average annual emissions in calendar years 1988 and 1989 or the projected emissions ton- nage for calendar year 1995 of each eligible phase I extension unit, as designated under paragraph (3), and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/mmBtu, divided by 2,000; (B) the difference between the lesser of the average annual emissions in calendar years 1988 and 1989 or the projected emissions ton- nage for calendar year 1996 of each eligible phase I extension unit, as designated under paragraph (3), and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/mmBtu, divided by 2,000; and (C) the amount by which (i) the product of each unit’s baseline multiplied by an emission rate of 1.20 lbs/mmBtu, divided by 2,000, ex- ceeds (ii) the tonnage level specified under subparagraph (E) of paragraph (2) of this sub- section multiplied by a factor of 3. (5) Each eligible Phase I extension unit shall receive allowances determined under subsection (a)(1) or (c) of this section. In addition, for cal- endar year 1995, the Administrator shall allocate to each eligible Phase I extension unit, from the allowance reserve created pursuant to sub- section (a)(2), allowances equal to the difference between the lesser of the average annual emis- sions in calendar years 1988 and 1989 or its pro- jected emissions tonnage for calendar year 1995 and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/mmBtu, divided by 2,000. In calendar year 1996, the Adminis- trator shall allocate for each eligible unit, from the allowance reserve created pursuant to sub- section (a)(2) of this section, allowances equal to the difference between the lesser of the average annual emissions in calendar years 1988 and 1989 or its projected emissions tonnage for calendar year 1996 and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/ mmBtu, divided by 2,000. It shall be unlawful for any source or unit subject to an approved exten- sion plan under this subsection to emit sulfur dioxide in excess of the emissions limitations provided for in the permit and approved exten- sion plan, unless the owner or operator of each unit governed by the permit and approved plan holds allowances to emit not less than the unit’s total annual emissions. (6) In addition to allowances specified in para- graph (5), the Administrator shall allocate for each eligible Phase I extension unit employing qualifying Phase I technology, for calendar years 1997, 1998, and 1999, additional allowances, from any remaining allowances in the reserve created pursuant to subsection (a)(2), following the reduction in the reserve provided for in paragraph (4), not to exceed the amount by which (A) the product of each eligible unit’s baseline times an emission rate of 1.20 lbs/ mmBtu, divided by 2,000, exceeds (B) the ton- nage level specified under subparagraph (E) of paragraph (2) of this subsection. (7) After January 1, 1997, in addition to any li- ability under this chapter, including under sec- tion 7651j of this title, if any eligible phase I ex- tension unit employing qualifying phase I tech- nology or any transfer unit under this sub- section emits sulfur dioxide in excess of the an- nual tonnage limitation specified in the exten- sion plan, as approved in paragraph (3) of this subsection, the Administrator shall, in the cal- endar year following such excess, deduct allow- ances equal to the amount of such excess from such unit’s annual allowance allocation. (e) Allocation of allowances (1) In the case of a unit that receives author- ization from the Governor of the State in which such unit is located to make reductions in the emissions of sulfur dioxide prior to calendar year 1995 and that is part of a utility system that meets the following requirements: (A) the total coal-fired generation within the utility system as a percentage of total system genera- tion decreased by more than 20 percent between January 1, 1980, and December 31, 1985; and (B) the weighted capacity factor of all coal-fired units within the utility system averaged over the period from January 1, 1985, through Decem- ber 31, 1987, was below 50 percent, the Adminis- trator shall allocate allowances under this para- graph for the unit pursuant to this subsection. The Administrator shall allocate allowances for a unit that is an affected unit pursuant to sec- tion 7651d of this title (but is not also an af- fected unit under this section) and part of a util- ity system that includes 1 or more affected units under section 7651d of this title for reductions in the emissions of sulfur dioxide made during the period 1995–1999 if the unit meets the require- ments of this subsection and the requirements of the preceding sentence, except that for the purposes of applying this subsection to any such unit, the prior year concerned as specified below, shall be any year after January 1, 1995 but prior to January 1, 2000. (2) In the case of an affected unit under this section described in subparagraph (A),4 the al- Page 7421 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651c 5 So in original. Probably should be ‘‘subsection’’. 6 So in original. Probably should be ‘‘majeure’’. 7 So in original. Probably should be ‘‘impracticability’’. lowances allocated under this subsection for early reductions in any prior year may not ex- ceed the amount which (A) the product of the unit’s baseline multiplied by the unit’s 1985 ac- tual sulfur dioxide emission rate (in lbs. per mmBtu), divided by 2,000, exceeds (B) the allow- ances specified for such unit in Table A. In the case of an affected unit under section 7651d of this title described in subparagraph (A),4 the al- lowances awarded under this subsection for early reductions in any prior year may not ex- ceed the amount by which (i) the product of the quantity of fossil fuel consumed by the unit (in mmBtu) in the prior year multiplied by the less- er of 2.50 or the most stringent emission rate (in lbs. per mmBtu) applicable to the unit under the applicable implementation plan, divided by 2,000, exceeds (ii) the unit’s actual tonnage of sulfur dioxide emission for the prior year con- cerned. Allowances allocated under this sub- section for units referred to in subparagraph (A) 4 may be allocated only for emission reduc- tions achieved as a result of physical changes or changes in the method of operation made after November 15, 1990, including changes in the type or quality of fossil fuel consumed. (3) In no event shall the provisions of this paragraph 5 be interpreted as an event of force majeur 6 or a commercial impractibility 7 or in any other way as a basis for excused non- performance by a utility system under a coal sales contract in effect before November 15, 1990. TABLE A.—AFFECTED SOURCES AND UNITS IN PHASE I AND THEIR SULFUR DIOXIDE ALLOWANCES (TONS) State Plant Name Gener- ator Phase I Allow- ances Alabama .......... Colbert ................ 1 2 3 4 5 13,570 15,310 15,400 15,410 37,180 E.C. Gaston ......... 1 2 3 4 5 18,100 18,540 18,310 19,280 59,840 Florida ............ Big Bend ............. 1 2 3 28,410 27,100 26,740 Crist .................... 6 7 19,200 31,680 Georgia ............ Bowen ................. 1 2 3 4 56,320 54,770 71,750 71,740 Hammond ............ 1 2 3 4 8,780 9,220 8,910 37,640 J. McDonough ..... 1 2 19,910 20,600 Wansley .............. 1 2 70,770 65,430 TABLE A.—AFFECTED SOURCES AND UNITS IN PHASE I AND THEIR SULFUR DIOXIDE ALLOWANCES (TONS)—CON- TINUED State Plant Name Gener- ator Phase I Allow- ances Yates ................... 1 2 3 4 5 6 7 7,210 7,040 6,950 8,910 9,410 24,760 21,480 Illinois ............. Baldwin ............... 1 2 3 42,010 44,420 42,550 Coffeen ................ 1 2 11,790 35,670 Grand Tower ....... 4 5,910 Hennepin ............. 2 18,410 Joppa Steam ....... 1 2 3 4 5 6 12,590 10,770 12,270 11,360 11,420 10,620 Kincaid ............... 1 2 31,530 33,810 Meredosia ........... 3 13,890 Vermilion ........... 2 8,880 Indiana ............ Bailly .................. 7 8 11,180 15,630 Breed ................... 1 18,500 Cayuga ................ 1 2 33,370 34,130 Clifty Creek ........ 1 2 3 4 5 6 20,150 19,810 20,410 20,080 19,360 20,380 E. W. Stout ......... 5 6 7 3,880 4,770 23,610 F. B. Culley ......... 2 3 4,290 16,970 F. E. Ratts .......... 1 2 8,330 8,480 Gibson ................. 1 2 3 4 40,400 41,010 41,080 40,320 H. T. Pritchard ... 6 5,770 Michigan City ..... 12 23,310 Petersburg .......... 1 2 16,430 32,380 R. Gallagher ........ 1 2 3 4 6,490 7,280 6,530 7,650 Tanners Creek .... 4 24,820 Wabash River ...... 1 2 3 5 6 4,000 2,860 3,750 3,670 12,280 Warrick ............... 4 26,980 Iowa ................. Burlington .......... 1 10,710 Des Moines .......... 7 2,320 George Neal ........ 1 1,290 M.L. Kapp ........... 2 13,800 Prairie Creek ...... 4 8,180 Riverside ............. 5 3,990 Kansas ............. Quindaro ............. 2 4,220 Kentucky ......... Coleman .............. 1 2 3 11,250 12,840 12,340 Page 7422 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651c TABLE A.—AFFECTED SOURCES AND UNITS IN PHASE I AND THEIR SULFUR DIOXIDE ALLOWANCES (TONS)—CON- TINUED State Plant Name Gener- ator Phase I Allow- ances Cooper ................. 1 2 7,450 15,320 E.W. Brown ......... 1 2 3 7,110 10,910 26,100 Elmer Smith ....... 1 2 6,520 14,410 Ghent .................. 1 28,410 Green River ......... 4 7,820 H.L. Spurlock ..... 1 22,780 Henderson II ....... 1 2 13,340 12,310 Paradise .............. 3 59,170 Shawnee .............. 10 10,170 Maryland ......... Chalk Point ........ 1 2 21,910 24,330 C. P. Crane .......... 1 2 10,330 9,230 Morgantown ........ 1 2 35,260 38,480 Michigan ......... J. H. Campbell .... 1 2 19,280 23,060 Minnesota ........ High Bridge ......... 6 4,270 Mississippi ....... Jack Watson ....... 4 5 17,910 36,700 Missouri .......... Asbury ................ 1 16,190 James River ........ 5 4,850 Labadie ............... 1 2 3 4 40,110 37,710 40,310 35,940 Montrose ............. 1 2 3 7,390 8,200 10,090 New Madrid ......... 1 2 28,240 32,480 Sibley .................. 3 15,580 Sioux ................... 1 2 22,570 23,690 Thomas Hill ........ 1 2 10,250 19,390 New Hampshire Merrimack .......... 1 2 10,190 22,000 New Jersey ...... B.L. England ....... 1 2 9,060 11,720 New York ......... Dunkirk .............. 3 4 12,600 14,060 Greenidge ............ 4 7,540 Milliken .............. 1 2 11,170 12,410 Northport ............ 1 2 3 19,810 24,110 26,480 Port Jefferson ..... 3 4 10,470 12,330 Ohio ................. Ashtabula ........... 5 16,740 Avon Lake .......... 8 9 11,650 30,480 Cardinal .............. 1 2 34,270 38,320 Conesville ........... 1 2 3 4 4,210 4,890 5,500 48,770 Eastlake .............. 1 2 3 4 5 7,800 8,640 10,020 14,510 34,070 Edgewater ........... 4 5,050 Gen. J.M. Gavin .. 1 2 79,080 80,560 TABLE A.—AFFECTED SOURCES AND UNITS IN PHASE I AND THEIR SULFUR DIOXIDE ALLOWANCES (TONS)—CON- TINUED State Plant Name Gener- ator Phase I Allow- ances Kyger Creek ........ 1 2 3 4 5 19,280 18,560 17,910 18,710 18,740 Miami Fort ......... 5 6 7 760 11,380 38,510 Muskingum River 1 2 3 4 5 14,880 14,170 13,950 11,780 40,470 Niles .................... 1 2 6,940 9,100 Picway ................ 5 4,930 R.E. Burger ......... 3 4 5 6,150 10,780 12,430 W.H. Sammis ...... 5 6 7 24,170 39,930 43,220 W.C. Beckjord ..... 5 6 8,950 23,020 Pennsylvania ... Armstrong .......... 1 2 14,410 15,430 Brunner Island .... 1 2 3 27,760 31,100 53,820 Cheswick ............. 1 39,170 Conemaugh ......... 1 2 59,790 66,450 Hatfield’s Ferry .. 1 2 3 37,830 37,320 40,270 Martins Creek ..... 1 2 12,660 12,820 Portland .............. 1 2 5,940 10,230 Shawville ............ 1 2 3 4 10,320 10,320 14,220 14,070 Sunbury .............. 3 4 8,760 11,450 Tennessee ........ Allen ................... 1 2 3 15,320 16,770 15,670 Cumberland ........ 1 2 86,700 94,840 Gallatin .............. 1 2 3 4 17,870 17,310 20,020 21,260 Johnsonville ....... 1 2 3 4 5 6 7 8 9 10 7,790 8,040 8,410 7,990 8,240 7,890 8,980 8,700 7,080 7,550 West Virginia .. Albright .............. 3 12,000 Fort Martin ........ 1 2 41,590 41,200 Harrison .............. 1 2 3 48,620 46,150 41,500 Page 7423 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651c TABLE A.—AFFECTED SOURCES AND UNITS IN PHASE I AND THEIR SULFUR DIOXIDE ALLOWANCES (TONS)—CON- TINUED State Plant Name Gener- ator Phase I Allow- ances Kammer .............. 1 2 3 18,740 19,460 17,390 Mitchell .............. 1 2 43,980 45,510 Mount Storm ...... 1 2 3 43,720 35,580 42,430 Wisconsin ........ Edgewater ........... 4 24,750 La Crosse/Genoa .. 3 22,700 Nelson Dewey ...... 1 2 6,010 6,680 N. Oak Creek ...... 1 2 3 4 5,220 5,140 5,370 6,320 Pulliam ............... 8 7,510 S. Oak Creek ....... 5 6 7 8 9,670 12,040 16,180 15,790 (f) Energy conservation and renewable energy (1) Definitions As used in this subsection: (A) Qualified energy conservation measure The term ‘‘qualified energy conservation measure’’ means a cost effective measure, as identified by the Administrator in consulta- tion with the Secretary of Energy, that in- creases the efficiency of the use of elec- tricity provided by an electric utility to its customers. (B) Qualified renewable energy The term ‘‘qualified renewable energy’’ means energy derived from biomass, solar, geothermal, or wind as identified by the Ad- ministrator in consultation with the Sec- retary of Energy. (C) Electric utility The term ‘‘electric utility’’ means any per- son, State agency, or Federal agency, which sells electric energy. (2) Allowances for emissions avoided through energy conservation and renewable energy (A) In general The regulations under paragraph (4) of this subsection shall provide that for each ton of sulfur dioxide emissions avoided by an elec- tric utility, during the applicable period, through the use of qualified energy con- servation measures or qualified renewable energy, the Administrator shall allocate a single allowance to such electric utility, on a first-come-first-served basis from the Con- servation and Renewable Energy Reserve es- tablished under subsection (g), up to a total of 300,000 allowances for allocation from such Reserve. (B) Requirements for issuance The Administrator shall allocate allow- ances to an electric utility under this sub- section only if all of the following require- ments are met: (i) Such electric utility is paying for the qualified energy conservation measures or qualified renewable energy directly or through purchase from another person. (ii) The emissions of sulfur dioxide avoided through the use of qualified en- ergy conservation measures or qualified renewable energy are quantified in accord- ance with regulations promulgated by the Administrator under this subsection. (iii)(I) Such electric utility has adopted and is implementing a least cost energy conservation and electric power plan which evaluates a range of resources, in- cluding new power supplies, energy con- servation, and renewable energy resources, in order to meet expected future demand at the lowest system cost. (II) The qualified energy conservation measures or qualified renewable energy, or both, are consistent with that plan. (III) Electric utilities subject to the ju- risdiction of a State regulatory authority must have such plan approved by such au- thority. For electric utilities not subject to the jurisdiction of a State regulatory authority such plan shall be approved by the entity with rate-making authority for such utility. (iv) In the case of qualified energy con- servation measures undertaken by a State regulated electric utility, the Secretary of Energy certifies that the State regulatory authority with jurisdiction over the elec- tric rates of such electric utility has es- tablished rates and charges which ensure that the net income of such electric utility after implementation of specific cost effec- tive energy conservation measures is at least as high as such net income would have been if the energy conservation meas- ures had not been implemented. Upon the date of any such certification by the Sec- retary of Energy, all allowances which, but for this paragraph, would have been allo- cated under subparagraph (A) before such date, shall be allocated to the electric util- ity. This clause is not a requirement for qualified renewable energy. (v) Such utility or any subsidiary of the utility’s holding company owns or oper- ates at least one affected unit. (C) Period of applicability Allowances under this subsection shall be allocated only with respect to kilowatt hours of electric energy saved by qualified energy conservation measures or generated by qualified renewable energy after January 1, 1992 and before the earlier of (i) December 31, 2000, or (ii) the date on which any electric utility steam generating unit owned or oper- ated by the electric utility to which the al- lowances are allocated becomes subject to this subchapter (including those sources that elect to become affected by this sub- chapter, pursuant to section 7651i of this title). Page 7424 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651c 8 So in original. There is no cl. (ii). 9 So in original. The comma probably should be a semicolon. (D) Determination of avoided emissions (i) 8 Application In order to receive allowances under this subsection, an electric utility shall make an application which— (I) designates the qualified energy con- servation measures implemented and the qualified renewable energy sources used for purposes of avoiding emissions,9 (II) calculates, in accordance with sub- paragraphs (F) and (G), the number of tons of emissions avoided by reason of the implementation of such measures or the use of such renewable energy sources; and (III) demonstrates that the require- ments of subparagraph (B) have been met. Such application for allowances by a State-regulated electric utility shall re- quire approval by the State regulatory au- thority with jurisdiction over such electric utility. The authority shall review the ap- plication for accuracy and compliance with this subsection and the rules under this subsection. Electric utilities whose re- tail rates are not subject to the jurisdic- tion of a State regulatory authority shall apply directly to the Administrator for such approval. (E) Avoided emissions from qualified energy conservation measures For the purposes of this subsection, the emission tonnage deemed avoided by reason of the implementation of qualified energy conservation measures for any calendar year shall be a tonnage equal to the product of multiplying— (i) the kilowatt hours that would other- wise have been supplied by the utility dur- ing such year in the absence of such quali- fied energy conservation measures, by (ii) 0.004, and dividing by 2,000. (F) Avoided emissions from the use of quali- fied renewable energy The emissions tonnage deemed avoided by reason of the use of qualified renewable en- ergy by an electric utility for any calendar year shall be a tonnage equal to the product of multiplying— (i) the actual kilowatt hours generated by, or purchased from, qualified renewable energy, by (ii) 0.004, and dividing by 2,000. (G) Prohibitions (i) No allowances shall be allocated under this subsection for the implementation of programs that are exclusively informational or educational in nature. (ii) No allowances shall be allocated for en- ergy conservation measures or renewable en- ergy that were operational before January 1, 1992. (3) Savings provision Nothing in this subsection precludes a State or State regulatory authority from providing additional incentives to utilities to encourage investment in demand-side resources. (4) Regulations Not later than 18 months after November 15, 1990, and in conjunction with the regulations required to be promulgated under subsections (b) and (c), the Administrator shall, in con- sultation with the Secretary of Energy, pro- mulgate regulations under this subsection. Such regulations shall list energy conserva- tion measures and renewable energy sources which may be treated as qualified energy con- servation measures and qualified renewable energy for purposes of this subsection. Allow- ances shall only be allocated if all require- ments of this subsection and the rules promul- gated to implement this subsection are com- plied with. The Administrator shall review the determinations of each State regulatory au- thority under this subsection to encourage consistency from electric utility to electric utility and from State to State in accordance with the Administrator’s rules. The Adminis- trator shall publish the findings of this review no less than annually. (g) Conservation and Renewable Energy Reserve The Administrator shall establish a Conserva- tion and Renewable Energy Reserve under this subsection. Beginning on January 1, 1995, the Administrator may allocate from the Conserva- tion and Renewable Energy Reserve an amount equal to a total of 300,000 allowances for emis- sions of sulfur dioxide pursuant to section 7651b of this title. In order to provide 300,000 allow- ances for such reserve, in each year beginning in calendar year 2000 and until calendar year 2009, inclusive, the Administrator shall reduce each unit’s basic Phase II allowance allocation on the basis of its pro rata share of 30,000 allowances. If allowances remain in the reserve after January 2, 2010, the Administrator shall allocate such al- lowances for affected units under section 7651d of this title on a pro rata basis. For purposes of this subsection, for any unit subject to the emis- sions limitation requirements of section 7651d of this title, the term ‘‘pro rata basis’’ refers to the ratio which the reductions made in such unit’s allowances in order to establish the reserve under this subsection bears to the total of such reductions for all such units. (h) Alternative allowance allocation for units in certain utility systems with optional baseline (1) Optional baseline for units in certain sys- tems In the case of a unit subject to the emissions limitation requirements of this section which (as of November 15, 1990)— (A) has an emission rate below 1.0 lbs/ mmBtu, (B) has decreased its sulfur dioxide emis- sions rate by 60 percent or greater since 1980, and (C) is part of a utility system which has a weighted average sulfur dioxide emissions rate for all fossil fueled-fired units below 1.0 lbs/mmBtu, Page 7425 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 7651d at the election of the owner or operator of such unit, the unit’s baseline may be cal- culated (i) as provided under section 7651a(d) 1 of this title, or (ii) by utilizing the unit’s aver- age annual fuel consumption at a 60 percent capacity factor. Such election shall be made no later than March 1, 1991. (2) Allowance allocation Whenever a unit referred to in paragraph (1) elects to calculate its baseline as provided in clause (ii) of paragraph (1), the Administrator shall allocate allowances for the unit pursuant to section 7651b(a)(1) of this title, this section, and section 7651d of this title (as basic Phase II allowance allocations) in an amount equal to the baseline selected multiplied by the lower of the average annual emission rate for such unit in 1989, or 1.0 lbs./mmBtu. Such al- lowance allocation shall be in lieu of any allo- cation of allowances under this section and section 7651d of this title. (July 14, 1955, ch. 360, title IV, § 404, as added Pub. L. 101–549, title IV, § 401, Nov. 15, 1990, 104 Stat. 2592.) § 7651d. Phase II sulfur dioxide requirements (a) Applicability (1) After January 1, 2000, each existing utility unit as provided below is subject to the limita- tions or requirements of this section. Each util- ity unit subject to an annual sulfur dioxide ton- nage emission limitation under this section is an affected unit under this subchapter. Each source that includes one or more affected units is an affected source. In the case of an existing unit that was not in operation during calendar year 1985, the emission rate for a calendar year after 1985, as determined by the Administrator, shall be used in lieu of the 1985 rate. The owner or operator of any unit operated in violation of this section shall be fully liable under this chap- ter for fulfilling the obligations specified in sec- tion 7651j of this title. (2) In addition to basic Phase II allowance al- locations, in each year beginning in calendar year 2000 and ending in calendar year 2009, inclu- sive, the Administrator shall allocate up to 530,000 Phase II bonus allowances pursuant to subsections (b)(2), (c)(4), (d)(3)(A) and (B), and (h)(2) of this section and section 7651e of this title. Not later than June 1, 1998, the Adminis- trator shall calculate, for each unit granted an extension pursuant to section 7651h of this title the difference between (A) the number of allow- ances allocated for the unit in calendar year 2000, and (B) the product of the unit’s baseline multiplied by 1.20 lbs/mmBtu, divided by 2000, and sum the computations. In each year, begin- ning in calendar year 2000 and ending in cal- endar year 2009, inclusive, the Administrator shall deduct from each unit’s basic Phase II al- lowance allocation its pro rata share of 10 per- cent of the sum calculated pursuant to the pre- ceding sentence. (3) In addition to basic Phase II allowance al- locations and Phase II bonus allowance alloca- tions, beginning January 1, 2000, the Adminis- trator shall allocate for each unit listed on Table A in section 7651c of this title (other than units at Kyger Creek, Clifty Creek, and Joppa Steam) and located in the States of Illinois, In- diana, Ohio, Georgia, Alabama, Missouri, Penn- sylvania, West Virginia, Kentucky, or Tennessee allowances in an amount equal to 50,000 multi- plied by the unit’s pro rata share of the total number of basic allowances allocated for all units listed on Table A (other than units at Kyger Creek, Clifty Creek, and Joppa Steam). Allowances allocated pursuant to this paragraph shall not be subject to the 8,900,000 ton limita- tion in section 7651b(a) of this title. (b) Units equal to, or above, 75 MWe and 1.20 lbs/ mmBtu (1) Except as otherwise provided in paragraph (3), after January 1, 2000, it shall be unlawful for any existing utility unit that serves a generator with nameplate capacity equal to, or greater, than 75 MWe and an actual 1985 emission rate equal to or greater than 1.20 lbs/mmBtu to ex- ceed an annual sulfur dioxide tonnage emission limitation equal to the product of the unit’s baseline multiplied by an emission rate equal to 1.20 lbs/mmBtu, divided by 2,000, unless the owner or operator of such unit holds allowances to emit not less than the unit’s total annual emissions. (2) In addition to allowances allocated pursu- ant to paragraph (1) and section 7651b(a)(1) of this title as basic Phase II allowance alloca- tions, beginning January 1, 2000, and for each calendar year thereafter until and including 2009, the Administrator shall allocate annually for each unit subject to the emissions limitation requirements of paragraph (1) with an actual 1985 emissions rate greater than 1.20 lbs/mmBtu and less than 2.50 lbs/mmBtu and a baseline ca- pacity factor of less than 60 percent, allowances from the reserve created pursuant to subsection (a)(2) in an amount equal to 1.20 lbs/mmBtu mul- tiplied by 50 percent of the difference, on a Btu basis, between the unit’s baseline and the unit’s fuel consumption at a 60 percent capacity fac- tor. (3) After January 1, 2000, it shall be unlawful for any existing utility unit with an actual 1985 emissions rate equal to or greater than 1.20 lbs/ mmBtu whose annual average fuel consumption during 1985, 1986, and 1987 on a Btu basis exceed- ed 90 percent in the form of lignite coal which is located in a State in which, as of July 1, 1989, no county or portion of a county was designated nonattainment under section 7407 of this title for any pollutant subject to the requirements of section 7409 of this title to exceed an annual sul- fur dioxide tonnage limitation equal to the prod- uct of the unit’s baseline multiplied by the less- er of the unit’s actual 1985 emissions rate or its allowable 1985 emissions rate, divided by 2,000, unless the owner or operator of such unit holds allowances to emit not less than the unit’s total annual emissions. (4) After January 1, 2000, the Administrator shall allocate annually for each unit, subject to the emissions limitation requirements of para- graph (1), which is located in a State with an in- stalled electrical generating capacity of more than 30,000,000 kw in 1988 and for which was issued a prohibition order or a proposed prohibi- tion order (from burning oil), which unit subse-