Ala. Admin. Code r. 335-3-5-.13
Current through Register Vol. 43, No. 1, October 31, 2024
Section 335-3-5-.13 - TR SO[2] Allowance Allocations(1)State SO2 Group 2 Trading Program Budget. The State trading budget for annual allocations of Transport Rule (TR) SO2 Group 2 allowances for the control periods 2017 and thereafter is 213,258 tons.(2)Timing Requirements for SO2 Group 2 Season Allowance Allocations. (a) By June 1, 2016, the Department will submit to the Administrator, in a format prescribed by the Administrator, the SO2 Group 2 allowance allocations, in accordance with paragraph (3) of this rule, for the control periods in 2017 and 2018.(b) By June 1, 2017, the Department will submit to the Administrator, in a format prescribed by the Administrator, the SO2 Group 2 allowance allocations, in accordance with paragraph (3) of this rule, for the control periods in 2019 and 2020.(c) By June 1, 2018, the Department will submit to the Administrator, in a format prescribed by the Administrator, the SO2 Group 2 allowance allocations, in accordance with paragraph (3) of this rule, for the control periods in 2021 and 2022.(d) By June 1, 2019, and every other year thereafter, the Department shall submit to the Administrator, in a format prescribed by the Administrator, the SO2 Group 2 allocations, in accordance with paragraph (3) of this rule, for the control periods in the two years that are four and five years after the year of the applicable deadline for submission under this paragraph.(3)SO2 Group 2 Allowance Allocations.(a)Definitions. For the purpose of this rule, the following definitions apply: 1.Baseline TR SO2 Group 2 Unit. A TR SO2 Group 2 unit that either: (i) Commenced operation on or before January 1, 2014; or(ii) Submitted a permit application to the Department that was affirmatively deemed complete by the Department in writing on or before January 1, 2014.2.New TR SO2 Group 2 Unit. A TR SO2 Group 2 unit that does not meet the definition of a Baseline SO2 Group 2 unit as defined in subparagraph (3) (a)1. of this paragraph.(b)Determination of Heat Input. 1. The heat input (in mmBtu) used for calculating TR SO2 Group 2 allowance allocations under subparagraph (2)(a) of this rule that are to be submitted to the Administrator by June 1, 2016 will be: (i) For a Baseline SO2 Group 2 unit, the average of the three (or less, if applicable) highest amounts of the unit's heat input for the control periods, in which the unit operated, in 2010, 2011, 2012, 2013, and 2014; or(ii) For a Baseline TR SO2 Group 2 unit that did not commence operation on or before January 1, 2014 but had submitted a permit application to the Department that was affirmatively deemed complete by the Department in writing on or before January 1, 2014, the expected actual annual heat input based on actual utilization data of similar sources.(iii) For a New SO2 Group 2 unit, the expected actual SO2 heat input based on actual utilization data of similar sources.2. The heat input (in mmBtu) used for calculating TR SO2 Group 2 allowance allocations under subparagraph (2)(b) of this rule that are to be submitted to the Administrator by June 1, 2017 will be: (i) For a Baseline TR SO2 Group 2 unit, the average of the three (or less, if applicable) highest amounts of the unit's heat input for the control periods, in which the unit operated, in 2011, 2012, 2013, 2014, and 2015; or(ii) For a Baseline TR SO2 Group 2 unit that did not commence operation on or before January 1, 2015 but had submitted a permit application to the Department that was affirmatively deemed complete by the Department in writing on or before January 1, 2014, the expected actual annual heat input based on actual utilization data of similar sources.(iii) For a New TR SO2 Group 2 unit that commenced operation on or before January 1, 2015, the average of the three (or less, if applicable) highest amounts of the unit's heat input for the control periods, in which the unit operated in 2014 and 2015.(iv) For a New TR SO2 Group 2 unit that did not commence operation on or before January 1, 2015, the expected actual SO2 heat input based on actual utilization data of similar sources.3. The heat input (in mmBtu) used for calculating TR SO2 Group 2 allowance allocations under subparagraph (2)(c) of this rule that are to be submitted to the Administrator by June 1, 2018 will be: (i) For a Baseline TR SO2 Group 2 unit, the average of the three (or less, if applicable) highest amounts of the unit's heat input, in which the unit operated in 2012, 2013, 2014, 2015, and 2 016.(ii) For a New TR SO2 Group 2 unit that commenced operation on or before January 1, 2016, the average of the three (or less, if applicable) highest amounts of the unit's heat input for the control period in which the unit operated in 2014, 2015, and 2 016.(iii) For a New TR SO2 Group 2 unit that did not commence operation on or before January 1, 2016, the expected actual annual heat input based on actual utilization data of similar sources.4. The heat input (in mmBtu) used for calculating TR SO2 Group 2 allowance allocations under subparagraph (2)(d) of this rule that are to be submitted to the Administrator by June 1, 2019, and all subsequent allocation years will be: (i) For a Baseline TR SO2 Group 2 unit, the average of the three (or less, if applicable) highest amounts of the unit's heat input, for the control periods in which the unit operated for the five most recent control periods available prior to the deadline submission year.(ii) For a New TR SO2 Group 2 unit that commenced operation prior to January 1 of the most recent control period available prior to the submission year, the average of the three (or less, if applicable) highest amounts of the unit's heat input, for the control periods in which the unit operated, for the five most recent control periods available prior to the submission year; or(iii) For a New SO2 Group 2 unit that did not commence operation prior to January 1 of the most recent control period available prior to the submission year, the expected actual annual heat input based on actual utilization data of similar sources.5. The unit's total heat input for the control period in each year specified under subparagraph (b) of this paragraph will be determined in accordance with 40 CFR 75 if the TR SO2 Group 2 unit was otherwise subject to the requirements of 40 CFR 75 for the year, or will be based on the best available data reported to the Administrator and the Department for the unit if the unit was not otherwise subject to the requirements of 40 CFR 75 for the year.(c)Establishment of Baseline and Retired Unit Allowance Pools. At the time Transport Rule (TR) SO2 Group 2 allowances are initially allocated to baseline TR SO2 Group 2 units under subparagraph (2)(a) of this rule, each unit's allocation will be permanently recorded as that unit's "Baseline Allowance". This value will be used to calculate the following: 1.Baseline Allowance Pool. The Baseline Allowance Pool shall be calculated each time TR SO2 Group 2 allowances are allocated under paragraph (2) of this rule and shall equal the State SO2 Group 2 Trading Program Budget minus the total of the Baseline Allowances for all baseline TR SO2 Group 2 units that have retired in accordance with 335-3-5-.08.2.Retired Unit Allowance Pool. The Retired Unit Allowance Pool shall be calculated each time TR SO2 Group 2 allowances are allocated under paragraph (2) of this rule and shall equal the sum of the Baseline Allowances for all TR SO2 Group 2 units that have retired in accordance with 335-3-5-.08.(d)Maximum Historic Emission Cap. The maximum historic emission cap is identified by using an 8 year historic emission period for each TR SO2 Group 2 unit. The last year of the 8 year period will be the same year as the last year used for determination of heat input under paragraph (3)(b) of this rule. The maximum historic emission cap is the maximum SO2 emissions (in tons) that occurred during any control period during the 8 year historic emission period. Data used for this purpose shall be obtained from the EPA Clean Air Markets Division (CAMD). An additional emission cap may be applied if a TR SO2 Group 2 unit has an enforcement action or permit limit in place. The 8 year historic emission values will update every two years to coincide with the allocation control period.(e)Calculation of TR SO2 Group 2 Allowances for Baseline TR SO2 Group 2 Units. 1. For each control period under subparagraph (2) of this rule, the Department will allocate TR SO2 Group 2 allowances from the Baseline Allowance Pool to all baseline TR SO2 Group 2 units in accordance with the following procedures: (i) The Department will allocate TR SO2 Group 2 allowances to each TR SO2 Group 2 unit under 335-3-5-.07(1) (a) in an amount equaling the unit's share of the State's total 3 year average of heat input determined in accordance with subparagraph (b) of this paragraph, multiplied by the baseline allowance pool. If a TR SO2 Group 2 unit has an initial historic heat input based allocation that exceeds its maximum historic emission cap as defined in subparagraph (3)(e) of this rule, then its allocation will equal the maximum historic emission cap for that TR SO2 Group 2 unit.(ii) Allocations remaining after the application of the maximum historic emission cap are reapportioned on the same basis to baseline TR SO2 Group 2 units whose historic heat input based allocation does not exceed its maximum historic emission cap, if applicable. These steps are repeated until the entire Baseline Allocation Pool is allocated. The resulting TR SO2 Group 2 allocation value is rounded to the nearest whole ton.(f)Calculation of SO2 Allowances for New TR SO2 Group 2_ Units. For each control period under paragraph (2) of this rule, after calculating SO2 allowances for all baseline TR SO2 Group 2 units that have not retired in accordance with 335-3-5-.08, the Department will allocate SO2 allowances in the Retired Unit Allowance Pool to all new SO2 Group 2 season units, in accordance with the following procedures: 1. For each new TR SO2 Group 2 unit under 335-3-5-.07(1)(a), that commenced operation or submitted a permit application affirmatively deemed complete by the Department in writing on or before March 1 of the year allocations are to be submitted to the Administrator under paragraph (2) of this rule, the number of TR SO2 Group 2 allowances allocated for each applicable control period will be equal to the unit's share of the State's total 3 year average of heat input for all new TR SO2 Group 2 units, determined in accordance with subparagraph (b) of this paragraph multiplied by the Retired Unit Allowance Pool. If a new TR SO2 Group 2 unit has an initial historic heat input based allocation that exceeds its maximum historic emission cap as defined in subparagraph (3)(e) of this rule, then its allocation equals the maximum historic emission cap for that TR SO2 Group 2 unit.2. Allocations remaining after application of the maximum historic emission cap are reapportioned on the same basis to new TR SO2 Group 2 units whose historic heat input based allocation does not exceed its maximum historic emission cap, if applicable. These steps are repeated until the entire Retired Unit Allowance Pool is allocated or until all new units receive allocations equal to its maximum historic emission cap. The resulting TR SO2 Group 2 allocation value is rounded to the nearest whole ton.(g)Adjustment of Baseline SO2 Allowance Allocations. If TR SO2 Group 2 allowances remain in the Retired Unit Allowance Pool after allocations are made to all new TR SO2 Group 2 units in accordance with subparagraph (f) of this paragraph, these SO2 allowances will be allocated on a pro rata basis to the baseline TR SO2 Group 2 units where historic heat input based allocation does not exceed its maximum historic emission cap, for the applicable control periods.(h) SO2 allowances allocated to baseline TR SO2 Group 2 units based on heat inputs determined in accordance with subparagraph (b)1.(ii) or (b)2.(ii) of this paragraph will be held in the State's general account until the unit commences operation, prior to or during the control period for which SO2 allowances were allocated. If the unit does not commence operations, the SO2 allowances will be transferred by the Department pro rata to Baseline TR SO2 Group 2 units that were allocated SO2 allowances in accordance with subparagraphs (b)1.(i) or (b)2.(i) of this paragraph, and whose historic heat input based allocation does not exceed its maximum historic emission cap if applicable. By January 30 of the following year, the Department shall notify the Administrator of the appropriate SO2 allowance transfers. 1. SO2 allowances allocated to new TR SO2 Group 2 units based on heat inputs determined in accordance with subparagraphs (b)1.(iii), (b)2.(iv), (b)3.(iii), or (b)4.(iii) of this paragraph will be held in the State's general account until the unit commences operation, prior to or during the control period for which SO2 allowances were allocated. If the unit does not commence operations, the SO2 allowances will be transferred by the Department pro rata to Baseline TR SO2 Group 2 units that were allocated SO2 allowances in accordance with subparagraphs (b)1.(i) and (ii), (b)2.(i) and (ii), (b)3.(i), or (b)4.(i) of this paragraph, and whose historic heat input based allocation does not exceed its maximum historic emission cap if applicable. By January 30 of the following year, the Department shall notify the Administrator of the appropriate SO2 allowance transfers.2. SO2 allowances will not be allocated to TR SO2 Group 2 units that retire under 335-3-5-.08 prior to the date SO2 allowance allocations are submitted to the Administrator under subparagraphs (2)(a), (b), (c), or (d) of this Rule.3. The total SO2 Group 2 allowances allocated for any control period in accordance with subparagraphs (3)(f), and (g) of this paragraph shall not exceed the State SO2 Group 2 Trading Program Budget as determined by the applicable, approved State Implementation Plan.(i)Distribution of remaining TR SO2 Group 2 Allowances. If any TR SO2 Group 2 allowances remain after allocations are completed in subparagraphs (e) through (h) of this paragraph, the remaining allowances shall be distributed proportional to the allocations made in subparagraphs (e) through (h) of this paragraph beyond the unit's historical emissions cap. However, no unit may receive additional allocations that exceed any enforcement cap or permit limitation.(j)Units Incorrectly Allocated TR SO2 Group 2 Allowances. The procedures for addressing units that were incorrectly allocated TR SO2 Group 2 allowances are incorporated by reference as they exist in 40 CFR § 97.711(c), Subpart DDDDD as of July 1, 2015. (The materials incorporated by reference are available for purchase and inspection at the Department's offices. )Ala. Admin. Code r. 335-3-5-.13
New Rule: Filed June 6, 2006; effective July 11, 2006. Amended: Filed February 27, 2007; effective April 3, 2007. Amended: Filed February 24, 2009, effective March 31, 2009. Filed March 14, 2012: Certified rule refilled after agency adoption of suggested amendment by the Joint Committee on Administrative Regulation Review that the repeal of the rule will take effect when the department certifies to the Legislative Reference Service the federal CAIR rules have been repealed; effective March 14, 2012.Adopted by Alabama Administrative Monthly Volume XXXIV, Issue No. 01, October 30, 2015, eff. 11/24/2015.Amended by Alabama Administrative Monthly Volume XXXVII, Issue No. 01, October 31, 2018, eff. 12/7/2018.Author: Ronald W. Gore
Statutory Authority:Code of Ala. 1975, §§ 22-28-10, 22-28-11, 22-28-14, 22-28-18, 22-28-20, 22-28-22, 22-22A-5, 22-22A-6, 22-22A-8.