Allocations of Cross-State Air Pollution Rule Allowances From New Unit Set-Asides for the 2015 Compliance Year

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final rule; notice of data availability (NODA).

SUMMARY:

The Environmental Protection Agency (EPA) is providing notice of emission allowance allocations to certain units under the new unit set-aside (NUSA) provisions of the Cross-State Air Pollution Rule (CSAPR) federal implementation plans (FIPs) and is responding to objections to preliminary calculations. EPA has completed final calculations for the first round of NUSA allowance allocations for the 2015 compliance year and has posted spreadsheets containing the calculations on EPA's Web site. The final allocations are unchanged from the preliminary calculations. EPA will record the allocated allowances in sources' Allowance Management System (AMS) accounts by August 1, 2015.

DATES:

July 28, 2015.

FOR FURTHER INFORMATION CONTACT:

Questions concerning this action should be addressed to Robert Miller at (202) 343-9077 or miller.robertl@epa.gov or to Kenon Smith at (202) 343-9164 or smith.kenon@epa.gov.

SUPPLEMENTARY INFORMATION:

Under the CSAPR FIPs, a portion of each state budget for each of the four CSAPR emissions trading programs is reserved as a NUSA from which allowances are allocated to eligible units through an annual one- or two-round process. In a NODA published in the Federal Register on June 1, 2015 (80 FR 30988), EPA described the allocation process and provided notice of preliminary calculations for the first-round 2015 NUSA allowance allocations. EPA also described the process for submitting any objections to the preliminary calculations.

In response to the June 1 NODA, EPA received three timely written objections, two late written objections, and several telephone inquiries. The objections and inquiries all concerned the question of whether EPA is correct to exclude emissions that occurred before a unit's monitor certification deadline from the emissions data used to calculate the NUSA allowance allocations. As explained below, under the regulations such emissions are properly excluded because they are not emissions during a “control period.”

Under the CSAPR FIPs, an eligible unit's first-round NUSA allowance allocation for a given compliance year is generally based on the unit's emissions “during the immediately preceding control period” (that is, the control period in the year before the compliance year). An eligible unit's second-round NUSA allowance allocation for a given compliance year is generally based on the positive difference, if any, between the unit's emissions “during such control period” (that is, the control period in the compliance year) and the unit's first-round NUSA allocation for the compliance year. A “control period” is defined as either a calendar year or a May-September period—for the SO₂ and NO_X annual programs and for the NO_X ozone season program, respectively—subject in both cases to an exclusion, for any given unit, of periods before the unit's monitor certification deadline, thereby ensuring that the unit's “control periods” generally represent the periods for which the unit must hold CSAPR allowances equal to its emissions. The emissions data used in calculating NUSA allowance allocations under the CSAPR FIPs thus properly exclude any emissions occurring before a unit's monitor certification deadline because such emissions are not emissions “during the immediately preceding control period” or “during such control period.”

EPA excluded emissions before units' monitor certification deadlines from the preliminary calculations of first-round 2015 NUSA allowance allocations discussed in the June 1 NODA. In the final calculations, EPA has likewise excluded emissions before units' monitor certification deadlines and has made no other changes to the data used in the preliminary calculations. The final first-round 2015 NUSA allowance allocations are therefore unchanged from the preliminary calculations.

The final unit-by-unit data and allowance allocation calculations are set forth in Excel spreadsheets titled “CSAPR_NUSA_2015_NOx_Annual_1st_Round_Final_Data”, “CSAPR_NUSA_2015_NOx_OS_1st_Round_Final_Data”, and “CSAPR_NUSA_2015_SO₂_1st_Round_Final_Data,” available on EPA's Web site at http://www.epa.gov/crossstaterule/actions.html. The three spreadsheets show EPA's final determinations of first-round 2015 NUSA allocations under the CSAPR NO_X annual, NO_X ozone season, and SO₂ (Group 1 and Group 2) trading programs, respectively.

Pursuant to CSAPR's allowance recordation timing requirements, the allocated NUSA allowances will be recorded in sources' AMS accounts by August 1, 2015. EPA notes that an allocation or lack of allocation of allowances to a given unit does not constitute a determination that CSAPR does or does not apply to the unit. EPA also notes that NUSA allocations are subject to potential correction if a unit to which NUSA allowances have been allocated for a given compliance year is not actually an affected unit as of January 1 (or May 1 in the case of the NO_X ozone season program) of the compliance year.

(Authority: 40 CFR 97.411(b), 97.511(b), 97.611(b), and 97.711(b).)