# STATE OF CONNECTICUT DEPARTMENT OF ENVIRONMENTAL PROTECTION

STATE OF CONNECTICUT AND MONTVILLE POWER LLC TRADING AGREEMENT AND ORDERNO. 8216A MODIFICATION NO.2

TRADING AGREEMENT AND ORDER MODIFICAnON In the matter ofa Trading Agreement and Orderbetween the Commissioner ofEnvironmental Protection ("Commissioner") and Montville PowerLLC ("MPLLC"). WHEREAS, the Commissioner and MPLLC, having agreed to the terms and conditions set forth in Trading Agreement and OrderNo. 8216A issued on April 30, 2003, and a Modification thereto issued on September 16,2004, do now, by mutual agreement, modify Trading Agreement and OrderNo. 8216A as follows: I. Delete the date September 30,2004, and substitute therefor May 1,2009, in paragraphs A.9., C.l., C.2., C.3.a., C.3.a. footnote 3, C.3.b., C.3.c., C.3.d., C.3.e., C.3.f., and C.6. 2. Delete paragraph A.6. and substitute the following therefor: Pursuant to Section 22a-174-22(j) ofthe Regulations, MPLLC intends both to acquire and generate approved DERCs until May 1,2009 for boiler 5 at the facility. Approved DERCs are defined for purposes ofthis Trading Agreement and Order as those for which the Commissionerhas provided written authority for use in compliance with Section 22a-174-22 ofthe Regulations. 3. Delete paragraph A.I

### O. in its entirety. 4. Delete paragraph 8.1. and substitute the following therefor: Comply with Section 22a-174-22(d)(l) ofthe Regulations through use ofBudget Discrete Emission Reduction Credit ("BDERC") and DERC trading. 5. Delete paragraph C.6.b. and substitute the following therefor: During the non-ozone season:

(Printed on Recycled Paper) 79 Elm Street • Hartford, CT 06106 - 5127 An Equal Opporllwity Employer

## .. , ,


### Montville PowerLLC 2 

### Trading Agreement and Order No. 8216A Modification No.2 During the period from October I through April 30, inclusive, each yearuntil May 1,2009, the boiler shall, in addition to meeting the 24-houremission limit in Table 22-1 ofSection 22a-174-22 ofthe Regulations, meet a non-ozone season emission limit of0.15 IbIMMBtu. Priorto October I, 2006, October I, 2007, and October I, 2008, MPLLC shall estimate and acquire the amount ofnon-ozone season DERCs or allowances needed to complywith Section 22a-174-22(e)(3) of the Regulations as follows: Estimated DERCs (tons) = 

### [Estimated fuel use in MMBtu from October I through April 30 x (lower ofthe estimated seasonal average NOx emission rate orthe proportioned 24-hour allowable emission limit in IblMMBtu during October I through April 30

- (0.95 x 0.15IbIMMBtu))] -i- 

### 2000 pounds/ton. No laterthan May 31 of2007, 2008, and 2009, in addition to the DERCs retired pursuantto paragraph C.6.a. ofthis Trading Agreement and Order, MPLLC shall calculate and permanently retire DERCs used in the preceding non-ozone season as follows: Actual DERCs (tons) = 

### [Actual fuel use in MMBtu from October I through April 30 x (lower ofthe actual seasonal average NOx emission rate orthe proportioned 24-hour allowable emission limit in IblMMBtu during October I through April 30

- (0.95 x 0.15 IbIMMBtu))] -i- 

### 2000 pounds/ton. 6. Delete paragraph C.IO. and substitute the following therefor: Annual Emission Statement andNon-Ozone Season Emission Statement. No later than March I for the previous calendaryear and July 30 (forthe Octoberthrough April time period only starting in 2003) ofevery year afterissuance ofthis Trading Agreement and Order, MPLLC shall provide to the Commissioner, a record ofeach sale or othertransfer, and use ofany and all ofthe DERCs approved within and subsequent to issuance ofthis Trading Agreement and Order until all such DERCs have been used or are no longer in MPLLC's possession. MPLLC shall also include actual NOx emissions from the boiler and the amount ofall DERCs used (including serial numbers (ifassigned) and approved DERCs generated and/orpurchased from other facilities), generated and/or approved for the previous calendaryear and Octoberthrough April time period. These reports shall be on a form prescribed by the Commissioner and shall be in monthly increments, and byozone and non-ozone seasons. 7. Delete paragraph C.12. and substitute the following therefor: DERC Shortfall. At a minimum, DERCs required shall be adjusted upwards by, 

# .. 

# ... .

# ..,
Montville PowerLLC 3 Trading Agreement and Order No. 8216A Modification No.2 100% ifDERCs are not in MPLLC's possession for use priorto the first day of each month or applicable season. However, nothing in this Trading Agreement and Order shall affect the Commissioner's authority to institute any proceeding or take any other action to require additional upward adjustment, based on the gravity ofany alleged noncompliance or violation oflaw. MPLLC shall permanently retire the quantity ofemissions causedbythe exceedance plus a 100% premium within sixty (60) days ofMPLLC's discovery ofthe DERC shortfall. MPLLC shall certify and report any such DERC retirement to the Commissionerin accordance with paragraph C.31. ofthis Trading Agreement and Order. 8. Delete paragraph C.14. and substitute the following therefor: Extension. No laterthan May I, 2009, with respect to the boiler, MPLLC shall complywith the requirements ofSections 22a-174-22(d)(1) and 22a-174- 22(d)(2)(A) ofthe Regulations. There is no assurance that the Commissionerwill grant awritten extension ofthis Trading Agreement and Order. 9. Delete paragraph C.IS. and substitute the following therefor: Future Compliance Report. On orbefore September I, 2008, MPLLC shall submit areport in writing to the Commissioner, as directed in paragraph C.32. ofthis Trading Agreement and Order, indicating how the facility shall comply with section 22a-174-22 ofthe Regulations with respect to the boiler on and afterMay 1,2009. 10. Delete paragraph C.18. and substitute the following therefor: Definitions. As used in this Trading Agreement and Order, "ApprovedDERCs" are those for which the Commissionerhas provided written authorization for use in compliance with Section 22a-174-22 ofthe Regulations; "Commissioner" means the Commissioneror arepresentative ofthe Commissioner; "Non-ozone season" means the period from October I through April 30 in any given calendar year; "Ozone season" means the period May 1 through September 30 in any given calendaryear. II. Delete paragraph C.19. and substitute the following therefor: Dates. The date of"issuance" ofthis Trading Agreement and Order is the date the Trading Agreement and Order is deposited in the U.S. mail orpersonally delivered, whichever is earlier. The date ofsubmission to the Commissioner of

any document required bythis Trading Agreement and Order shall be the date such document is received bythe Commissioner. The date ofany notice bythe Commissionerunder this Trading Agreement and Order, including but not limited to notIce ofapproval or disapproval ofany document or other action, shall be the date**s~ch** notice is deposited in the U.S. mail oris personallydelivered, whichever IS earher. Except as otherwise specified in this Trading Agreement and Order, the word "day" as used in this Trading Agreement and Ordermeans calendarday. Any document or action which is required bythis Trading Agreement and Order to be submitted orperformedby adate which falls on a Saturday, Sunday, or a Connecticutor federal holiday shall be submitted orperformed bythe next day whIch IS not a Saturday, Sunday, or Connecticut or federal holiday. ', •• 4 • . 1'\\ i •

Montville PowerLLC 4 Trading Agreement and Order No. 8216A Modification No.2

12. Delete the word "individual" and substitute therefor the word "section" in paragraph C.31. 13. Delete the name "Mr. Michael LaFleur" in paragraph C.32.
All otherterms and conditions ofTrading Agreement and Orderno. 8216A issued bythe CommIssIOner actmg under Chapter446c, Sections 22a-6, 22a-171, 22a-174, 22a-176, and 22a177 ofthe ConnectIcut General Statutes shall remain in effect.Montville PowerLLC 

### 5 Trading Agreement and Order No. 8216A Modification No.2 MPLLC hereby consents to the entry ofthis modification to the Trading Agreement and Order without further notice.
Signature: werLLC
Type Name: Type Title: Date: Bee ,McFalls Plant Manager

modification ofan Order ofthe Commissioner ofEnvironmental Protection.

Date

MAILED CERTIFIED MAIL, RETURN RECEIPT REQUESTED
Certified DocumentNo.