N.Y. PBS Law § 66-K — New York Code / Act PBS / Article 4 / Section 66-K
Allowance credit trading or sales
Status: in_force

§ 66-k. Allowance credit trading or sales. 1. Definitions. For\npurposes of this section, the following terms shall have the following\nmeanings:\n  (a) "SO2" shall mean sulfur dioxide.\n  (b) "SO2 allowance credit" shall mean any SO2 credit issued to a\ngenerating source within the United States pursuant to the provisions of\ntitle four of the Federal Clean Air Act Amendments of 1990.\n  (c) "select SO2 allowance credits" shall mean any SO2 allowance credit\nissued to generating sources located within the boundaries of the state\nof New York.\n  (d) "acid precipitation source states" shall mean the following\nstates:  New Jersey, Pennsylvania, Maryland, Delaware, Virginia, North\nCarolina, Tennessee, West Virginia, Ohio, Michigan, Illinois, Kentucky,\nIndiana and Wisconsin.\n  2. Air pollution mitigation offset. (a) The commission shall assess an\nair pollution mitigation offset equal to any sum received by any utility\ncorporation, person or entity entering into contracts or engaging in the\nsale or trade of select SO2 allowance credits for use in operations,\npermits or for maintaining compliance with SO2 emission requirements in\nacid precipitation source states, where such select SO2 allowance\ncredits are found to have been transferred to the allowance deductions\nreserve account by a generating source located in an acid rain source\nstate.\n  (b) Any utility corporation, person or entity entering into contracts\nor engaging in the sale or trade of any select SO2 allowance credits\nshall provide the commission with written notice of any select SO2\nallowance transaction with five business days of such transaction. Such\nnotice shall include the purchase price, and shall provide the\ncommission a copy of the Allowance Transfer Form of the United States\nEnvironmental Protection Agency upon the issuance and/or signing of said\nform relating to the sale, exchange or trade by the utility corporation,\nperson or entity, its subsidiaries, agents, employees, successors and\nassigns of select SO2 allowance credits.\n  (c) The commission will annually review information contained in the\nSO2 allowance tracking database operated by the United States\nEnvironmental Protection Agency for select SO2 allowances as identified\nby their unique serial number.\n  (d) Any moneys collected as an air pollution mitigation offset\npursuant to this subdivision shall be deposited in the air pollution\nmitigation fund established pursuant to section ninety-nine-g of the\nstate finance law and administered by the New York state energy research\nand development authority pursuant to subdivision ten-a of section\neighteen hundred fifty-four of the public authorities law.\n  3. Exemptions. (a) The commission, in consultation with the department\nof environmental conservation, shall produce by rule or order a model\nrestrictive covenant for use by any utility corporation, person or\nentity entering into contracts or engaging in the sale or trade of\nselect SO2 allowance credits. The model restrictive covenant will be a\nself-enforcing contract that shall include at a minimum, the requirement\nto give notice to the commission of any SO2 allowance transaction\ncovered by the restrictive covenant; the requirement that any subsequent\nholders of the SO2 allowance covered by the restrictive covenant include\nan identical restrictive covenant in any document relating to the sale\nor purchase of the covered SO2 allowances; provisions restricting usage\nin acid precipitation source states; and provisions for the enforcement\nof the terms of the restrictive covenant by the state of New York.\n  (b) Any utility corporation, person or entity entering into contracts\nor engaging in the sale or trade of select SO2 allowance credits may\nattach a restrictive covenant as a standard provision in any document\nrelating to the sale or trade by the utility corporation, person or\nentity, its subsidiaries, agents, employees, successors and assigns, of\nselect SO2 allowance credits. Such restrictive covenant must conform\nwith the required provisions of the model restrictive covenant produced\nby the commission pursuant to this subdivision.\n  (c) Any utility corporation, person or entity acting in conformance\nwith the provisions of this subdivision shall be exempt from the\nassessment of an air pollution mitigation offset.\n  4. Nothing contained in this section shall restrict a utility\ncorporation from use or transfer of SO2 allowances at New York\nfacilities owned, controlled or operated now or in the future by the\nutility corporation, its successors, assigns or purchasers that come to\nown, control or operate such facilities.\n  5. Nothing in this section shall discourage or prohibit allowance\ntrades (such as for retirement purposes) that will have a beneficial\nimpact on sensitive receptor areas in the state of New York.\n  6. Nothing within this section will invalidate or subvert any prior\ncontractual commitments and/or obligations made by a utility\ncorporation, person or entity identified in subdivision two of this\nsection prior to the effective date of this section.\n