Section 145.54. Compliance

(a) NO_x allowance transfer deadline. The NO_x allowances are available to be deducted for compliance with a unit’s NO_x budget emissions limitation for a control period in a given year only if the NO_x allowances meet the following conditions:

(1) The allowances are allocated for a control period in a prior year or the same year.

(2) The allowances are held in the unit’s compliance account, or the overdraft account of the source where the unit is located, as of the NO_x allowance transfer deadline for that control period or are transferred into the compliance account or overdraft account by a NO_x allowance transfer correctly submitted for recordation under § 145.60 (relating to submission of NO_x allowance transfers) by the NO_x allowance transfer deadline for that control period.

(b) Deductions for compliance.

(1) Following the recordation, in accordance with § 145.61 (relating to NO_x transfer recordation), of NO_x allowance transfers submitted for recordation in the unit’s compliance account or the overdraft account of the source where the unit is located by the NO_x allowance transfer deadline for a control period, the NO_x Budget Administrator will deduct NO_x allowances available under subsection (a) to cover the unit’s NO_x emissions (as determined in accordance with § § 145.70—145.76 (relating to recordkeeping and reporting requirements)), or to account for actual heat input under § 145.42(e) (relating to NO_x allowance allocations), for the control period:

(i) From the compliance account.

(ii) Only if no more NO_x allowances available under subsection (a) remain in the compliance account, from the overdraft account. In deducting allowances for units at the source from the overdraft account, the NO_x Budget Administrator will begin with the unit having the compliance account with the lowest NO_x Allowance Tracking System account number and end with the unit having the compliance account with the highest NO_x Allowance Tracking System account number (with account numbers sorted beginning with the left-most character and ending with the right-most character and the letter characters assigned values in alphabetical order and less than all numeric characters).

(2) NO_x allowances will be deducted first under subparagraph (i) and then under subparagraph (ii):

(i) Until the number of NO_x allowances deducted for the control period equals the number of tons of NO_x emissions, determined in accordance with § § 145.70—145.76, from the unit for the control period for which compliance is being determined, plus the number of NO_x allowances required for deduction to account for actual heat input under § 145.42(e) for the control period.

(ii) Until no more NO_x allowances available under subsection (a) remain in the respective account.

(c) Allowance identification.

(1) Identification of NO_x allowances by serial number. The NO_x authorized account representative for each compliance account may identify by serial number the NO_x allowances to be deducted from the unit’s compliance account under subsection (b), (d), (e) or (f). The identification shall be made in the compliance certification report submitted in accordance with § 145.30 (relating to compliance certification report).

(2) First-in, first-out. NO_x allowances will be deducted for a control period from the compliance account, in the absence of an identification or in the case of a partial identification of NO_x allowances by serial number under paragraph (1), or the overdraft account on a first-in, first-out (FIFO) accounting basis in the following order:

(i) Those NO_x allowances that were allocated for the control period to the unit under § § 145.40—145.43 or § § 145.80—145.88 (relating to NO_x allowance allocations; and opt-in process).

(ii) Those NO_x allowances that were allocated for the control period to any unit and transferred and recorded in the account under § § 145.60—145.62 (relating to NO_x allowance transfers), in order of their date of recordation.

(iii) Those NO_x allowances that were allocated for a prior control period to the unit under § § 145.40—145.43 or § § 145.80—145.88.

(iv) Those NO_x allowances that were allocated for a prior control period to any unit and transferred and recorded in the account under § § 145.60—145.62, in order of their date of recordation.

(d) Deductions for excess emissions.

(1) After making the deductions for compliance under subsection (b), the NO_x Budget Administrator will deduct from the unit’s compliance account or the overdraft account of the source where the unit is located a number of NO_x allowances, allocated for a control period after the control period in which the unit has excess emissions, equal to three times the number of the unit’s excess emissions.

(2) If the compliance account or overdraft account does not contain sufficient NO_x allowances, the NO_x Budget Administrator will deduct the required number of NO_x allowances, regardless of the control period for which they were allocated, whenever NO_x allowances are recorded in either account.

(3) An allowance deduction required under subsection (d) does not affect the liability of the owners and operators of the NO_x budget unit for any fine, penalty or assessment, or their obligation to comply with any other remedy, for the same violation, as ordered under the CAA or the act. The following guidelines will be followed in assessing fines, penalties or other obligations:

(i) For purposes of determining the number of days of violation, if a NO_x budget unit has excess emissions for a control period, each day in the control period (153 days) constitutes a day in violation unless the owners and operators of the unit demonstrate that a lesser number of days should be considered.

(ii) Each ton of excess emissions is a separate violation.

(e) Deductions for units sharing a common stack. In the case of units sharing a common stack and having emissions that are not separately monitored or apportioned in accordance with § § 145.70—145.76:

(1) The NO_x authorized account representative of the units may identify the percentage of NO_x allowances to be deducted from each unit’s compliance account to cover the unit’s share of NO_x emissions from the common stack for a control period. The identification shall be made in the compliance certification report submitted in accordance with § 145.30.

(2) Notwithstanding subsection (b)(2)(i), the NO_x Budget Administrator will deduct NO_x allowances for each unit until the number of NO_x allowances deducted equals the unit’s identified percentage (under paragraph (1)) of the number of tons of NO_x emissions, as determined in accordance with § § 145.70—145.76, from the common stack for the control period for which compliance is being determined or, if no percentage is identified, an equal percentage for each unit, plus the number of allowances required for deduction to account for actual heat input under § 145.42(e) for the control period.

(f) Deduction of banked allowances. Each year starting in 2005, after the NO_x Budget Administrator has completed the designation of banked allowances under § 145.55(b) (relating to banking) and before May 1 of the year, the NO_x Budget Administrator will determine the extent to which banked NO_x allowances otherwise available under subsection (a) are available for compliance in the control period for the current year as follows:

(1) The NO_x Budget Administrator will determine the total number of banked NO_x allowances held in compliance accounts, overdraft accounts or general accounts.

(2) If the total number of banked NO_x allowances determined, under paragraph (1), to be held in compliance accounts, overdraft accounts or general accounts is less than or equal to 10% of the sum of the trading program budgets under § 145.40 (relating to State Trading Program budget) for all states for the control period, any banked NO_x allowance may be deducted for compliance in accordance with subsections (a)—(e).

(3) If the total number of banked NO_x allowances determined, under paragraph (1) to be held in compliance accounts, overdraft accounts or general accounts exceeds 10% of the sum of the trading program budgets under § 145.40 for Pennsylvania and the trading program budgets approved by the administrator for other states participating in the NO_x budget trading program for the control period, any banked allowance may be deducted for compliance in accordance with subsections (a)—(e), except as follows:

(i) The NO_x Budget Administrator will determine the following ratio: 0.10 multiplied by the sum of the trading program budgets under § 145.40 for all states for the control period and divided by the total number of banked NO_x allowances determined, under paragraph (1), to be held in compliance accounts, overdraft accounts, or general accounts.

(ii) The NO_x Budget Administrator will multiply the number of banked NO_x allowances in each compliance account or overdraft account by the ratio determined under subparagraph (i). The resulting product is the number of banked NO_x allowances in the account that may be deducted for compliance in accordance with subsections (a)—(e), except that, if the NO_x allowances are used to make a deduction under subsection (b) or (e), two (rather than one), these NO_x allowances shall authorize up to 1 ton of NO_x emissions during the control period and shall be deducted for each deduction of one NO_x allowance required under subsection (b) or (e).

(g) The NO_x Budget Administrator will record in the appropriate compliance account or overdraft account all deductions from the account under subsection (b), (d) or (f).

Notation

Cross References

This section cited in 25 Pa. Code § 123.121 (relating to NO_x Allowance Program transition); 25 Pa. Code § 145.2 (relating to definitions); 25 Pa. Code § 145.4 (relating to applicability); 25 Pa. Code § 145.5 (relating to retired unit exemption); 25 Pa. Code § 145.30 (relating to compliance certification report); 25 Pa. Code § 145.42 (relating to NO_x allowance allocations); 25 Pa. Code § 145.43 (relating to compliance supplement budget); 25 Pa. Code § 145.50 (relating to NO_x Allowance Tracking System accounts); 25 Pa. Code § 145.53 (relating to recordation of NO_x allowance allocations); 25 Pa. Code § 145.55 (relating to banking); 25 Pa. Code § 145.81 (relating to opt-in source general provisions); 25 Pa. Code § 145.86 (relating to opt-in source withdrawal from NO_x Budget Trading Program); and 25 Pa. Code § 145.87 (relating to opt-in unit change in regulatory status).