### SIP DESCRIPTION

- Montville Power LLC-Trading Agreement and Order No. 8183A Modification I t. SIP

- DESCRIPTION OF DERC CREAnON ANDIOR USE SIP SUMMARY TABLE TradinQ: AQ'reement and Order No. 8183A Montville Power LLC 74 Lathrop Road Montville

# cr06382 Identifier Client 7741 Town # 107 Premise # 

# ISequence #

### J. Contact Ms. Cynthia Karlic Tel: (860) 343-6962 Fax (860) 343-6969 ReJtional Mana2er PoUutant and Regulatory Standard: NOx 

# I Section 22a-174-22 ofthe Regulations of Connecticut State A2encies. Nonattainment Area Classification Severe Annual DERCs needed Estimated 5ozone and I non-Qzone. Comoliance Time Period Until Aori130, 2007. Max. Emission Rate: CEM and full load emission rate (FLER) for Generation and Use. (See Table Ibelow):
Table 1 NOxEmission Rates and Allowable Limits 

# .. (pW FT4A-8 Turbines) Unit Fuel Maximum StackTest FLER Allowable Date of Next PIR number Capacity (ppmvd) IbslMMBlU Rate Stack Stack MMBtuIhr IbsIMMBlU Test Test Due Montville-IO #2 oil 256 9.718 3.11 2.35 

### 5/23/01 5/23/06 R-21· Montville-II #2 oil 256 10.236 2.96 2.35 

### 5/23/01 5/23/06 R-22
11. SPECIAL REOUIREMENTS

a. This Trading Agreement and OrderModification supersedes Trading Agreement and OrderNo. 8183A issued on April 22, 2003. b. Calculations ofcredits used shall be as specified in Trading Agreement and OrderNo. 8183A.
c. Montville Power LLC shall acquire and permanently retire seven ozone season DERCs for every actual ton ofexcess NOx emitted from the peaking unit during the previous ozone season based upon the actual emissions for each day that Connecticut one hour ozone levels were forecasted to be "moderate to unhealthful", "unhealthful", or ''very unhealthful".

# -~ STATE OF CONNECTICUT
. DEPARTMENT OF ENVIRONMENTAL PROTECTION**~~~**

STATE OF CONNECTICUT AND MONTVll..LE POWER LLC TRADING AGREEMENT AND ORDER NO. 8183A MODIFICATION NO. I
TRADING AGREEMENT AND ORDER MODIFICATION In the maUerofaTrading Agreement and Orderbetween the CommissionerofEnvironmental Protection ("Commissioner") and Montville Power

### U.c ("MPll.C"). WHEREAS, the Commissioner and MPLLC, having agreed to the terms and conditions set forth in Trading Agreement and OrderNo. 8183A signed by the Commissioner on April 22, 2003, do now, by mutual agreement, modify said Trading Agreement and Order as follows: t. Delete paragraph A.5. and substitute the following therefor: Reserved. 2. Delete the date April 30, 2007 and substitute therefor May 1,2007, in paragraphs A.6. and

## c.l. 3. Deleteparagraph C.Z.a. and substitute the following therefor: Until May 1,2007, before the first day ofeach month MPLLC shall have in its possession sufficient approved DERCs for the current day for the peaking units based on the following calculations; Before the first day ofeach month, 1v1PLLC shall estimate DERCs required for such month forthe peaking units as follows: (i) 

### At all times: EstimatedDERCs (in tons) use; [«(FLER in IbsIMMBtu)

- (0.95 x NOx allowable rate in IbslMMBtu)) x (estimated fuel use in MMBtu)] 2000 poundslton

(I'rinccd on Recycled Paper) 1\1 Elm Screel • li:lrlfnnt. CT 06106

- 

### sin All £q""j O"l'"rr,,,,ify Eml,/ovrrMontville Power LLC 2 Trading Agreement and Order No. 8183A Modification No.1 No later than the twentieth day ofeach month, MPLLC shall calculate and permanently retire DERCs used in the precedingcalendar month, as follows: Actual DERCs (in tons) 

## =[«(RER in IbsIMMBtu)

- (0.95 x NOx allowable rate in IbslMMBtu)) x (actual fuel use in MMBtu))
.. 2000 pounds/ton Where:
• NOx allowable rate:: allowable limit rate in IbsIMMBtu shown in Table 1 of this Trading Agreement and Order.
• HER 

### = full load emission rate in IbsIMMBtu as shown in Table 1 ofthis Trading Agreement and Order.
• Discount (0.95) 

### = 5% design margin applied to the allowable limit rate. ii) 

### During the ozone season only: No laterthan December31 steach year, MPLLC shall acquire and permanently retire seven ozone season DERCs for every actual [on ofexcess NOx emitted from the peaking units during the previous ozone season based upon the actual emissions for each day that ConnecticU( one hourozone levels were forecasted to 

### be "moderate to unheahhful", "unhealthful", or "very unhealthful", until such time that the EPA revokes the I-hourstandard. Upon such revocation, MPllC shall calculate and pennanently retire seven ozone season DERCs for every actual ton ofexcess NOx emitted from the peaking units during such ozone season based upon the actual emissions for each day that Connecticut eight hour ozone levels were forecasted to be "unhealthy for sensitive groups", "unhealthy", or "very unhealthy". Where: Actual ton ofexcess NOx emitted

### = [«FLER in IbslMMBtu)

- (0.95 x NOx allowable rate in IbslMMBtu)) x (actual fuel use in MMBtu))
.. 2000 poundslton The total actual tons ofexcess NOx emitted from the peaking units during forecasted ozone exceedance days shall be multiplied by seven and then rounded to the next greater whole ton, to detennine the number ofDERCs to be pennanentlyretired. This requirement is in addition to !.he MPLLC's requirement to estimate excess emissions and subsequent pennanent retirement ofa sufficient numberofapproved DERCs in accordance with paragraph C.2.a.(i) ofthis Trading Agreement and Order. 4. Delete paragraph C.2.b. and substitute the following therefor:Montville PowerLLC
Reserved. 3 Trading Agreement and Order No. 8183A Modification No. I

5. Delete paragraph 

### C.5. and substitute the following therefor: Annual DERC Report. No laterthan March 1 ofevery year afterissuance ofthis Trading Agreement and Order,**MP~C** shall submit in writing to the Commissioner, arecord ofeach sale orothertransferofDERCs for the previous calendaryear.**MP~C** shall also include actual NOx emissions from the peaking units and the amount**~f** all DERCs used (including serial numbers (ifassigned) and DERCs purchased from otherfacilities). These reports shall be on forms prescribed by the Commissioner and shall be in monthly increments, and by ozone and non ozone seasons. 6. Delete paragraph C.6. and substitute the following therefor: Allowance Use. Pursuant to Section 22a-174-22(d)(3) ofthe Regulations,**MP~C** may use NOx allowances, until May 1, 2007, for the peaking units pursuant to Section 22a-174·22(j) ofthe Regulations to achieve all or a portion of the reductions required by Section 22a-174-22 ofthe Regulations. Any allowance used forcompliance with Section 22a-174-22(e) ofthe Regulations shall be subject to all restrictions andlorrequirements applicable to DERCs contained in this Trading Agreement and Order;
a. In orderfor MPLLC to use NOx allowances, MPLLC shall create ageneral account oruse an existing compliance account oroverdraft account in EPA's NOx Allowance Tracking System ("NATS"); and b. Each allowance used for compliance with Section 22a-174-22 ofthe Regulations shall be equivalent to one discrete emission reduction credit. Allowances shall be considered used forcompliance with Section 22a174-22 ofthe Regulations when they are transferred from the facility's NOx general account in the NATS orthe facility's NOx compliance account in the NATS to the 

## cr State NOx RetirementAccount (Account ID CToo000003oo in the NATS). 7. Delete paragraph C.7. and substitute the following therefor: DERC Shortfall. At a minimum, DERCs required shall be adjusted upwards by

100% ifDERCs are notin MPLLC's possession for use priorto the first dayof each month orapplicable season. However, nothing in this Trading Agreement and Order shall affectthe Commissioner's authority to institute any proceeding or take any other action to require additional upward adjustment. based on the gravity ofany alleged noncompliance orviolation oflaw. MPLLC shallMontville PowerLLC 4 Trading Agreement and Order No. 8l83A Modification No.1 permanently retire the quantity ofDERCs equivalent to the excess emissions plus a 100% premium within sixty (60) days of:MPLLC's discovery ofthe DERC shortfall. MPLLC shall certify and report any such DERC retirement to the Commissionerin accordance with paragraph C.29. ofthis Trading Agreement and Order. 8. Delete paragraph C.9. and substitute the following therefor: FLER Exceedance. Noncompliance with an establishedFLER shall subject .MPLLC to make restitution by matching the quantity ofemissions ("true up") causedby the exceedance plus a 100% premium. The true up in tons of DERCs shall be equal to the FLER exceedance in IbslMMBtu, multiplied by the total heatinput during the period ofnoncompliance divided by 2000 lbslton. Ifthe period ofnoncompliance is not known, the time period from the completion ofthe last/previous Commissionerwitnessed emission test through the date the FLER compliance is achieved as approved by the Commissioner shall be used. However, nothing in this Trading Agreement and Order shall affectthe Commissioner's authority to institute any proceeding ortake any other action to require additional upward adjustment, based on the gravity of any alleged noncompliance orviolation oflaw. :MPLLC shall permanently retire DERCs calculated in accordance with the above plus a 100% premium within sixty (60) days of:MPLLC's discovery ofthe FLER exceedance. :MPLLC shall report anyFLER exceedance to the Commissioner in accordance with paragraph C.29. ofthis Trading Agreement and Order. 

### 9.



### 10.

11. Delete paragraph C.12. and substitute the following therefor: Extension. No laterthan May 1, 2007, with respect to the peaking units, MPLLC shall comply with the requirements ofSection 22a-174-22(d)(l) of the Regulations. There is no assurance that afterfull programreview ofthis and otherTrading Agreements and Orders that the Commissionerwill grant a written extension ofthis Trading Agreement and Order. Delete paragraph C.13. and substitute the following therefor: Future Compliance Report. On orbefore September 1, 2006, MPLLC shall submit areport in writing to the Commissioner, as directed in paragraph CJO. ofthis Trading Agreement and Order, indicating how the facility shall comply with Section 22a-174-22 ofthe Regulations with respect to the peaking units on and afterMay 1, 2007. Delete paragraph C.16. and substitute the following therefor:

### Montville PowerLLC 

### 6 Trading Agreement and Order No. 8183A Modification No.1 

### MPLLC herebyconsents to the entry ofthis modification to the Trading Agreement and Order withoutfurther notice. Montville PowerLLC Signature: Type Name: Type Title: Date: 

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# -Rf!!()fJ(;j G11M:Y}f!1Wt!L**tr'C~()9!Jt'Y**.,3--/S-Q.jIssued as a

### modification ofan Orderofthe CommissionerofEnvironmental Protection.

Date

MArr..ED CERTIFIED MArr..,

RETURN RECEIPT REQUESTED CertifiedDocumentNo. 7002 2030 0006 5643 0055