# TECHNICAL SUPPORT DOCUMENT

Louisiana CAIR NO X 

# Trading Programs Abbreviated

SIP Revision: Louisiana Methodologies for the CAIR

NO X 

# Annual and Ozone Season Allocations

Louisiana CAIR SO 2 

# SIP Revision

Louisiana Administrative Code

Title 33 – Environmental Quality

Part III – Air

Chapter 5 – Permit Procedures

Section 506 – Clean Air Interstate Rule Requirements

§§ 506(A), (B), and (C)

March 24, 2014

FOR FURTHER INFORMATION CONTACT: Ms. Adina Wiley, United States

Environmental Protection Agency Region 6, Air Permits Section (6PD-R), 1445 Ross

Avenue, Dallas, Texas, 75202-2733, (214) 665-2115

# 2 Subject: Review of Revisions to the St ate Implementation Plan Louisiana

Administrative Code, Title 33, Part III, Chapter 5, Sections 506(A),

506(B), and 506(C)

Contents:

I. Executive Summary

II. Background of State Submittal

III. Summary of State Submittal

IV. Technical Review

A. Part 51, Appendix V Completeness Checklist

B. Requirements for All CAIR Submissions

C. Requirements for CAIR Trading Programs

D. Part 51 Requirements

E. Section 110(l) Demonstration

F. Additional Revisions to CAIR

V. Conclusion

# 3 I. Executive Summary

This technical support document (TSD) review s proposed revisions to the Louisiana State

Implementation Plan (SIP) concerning the Cl ean Air Interstate Rule (CAIR) Nitrogen

Oxides (NO X 

# ) Annual and Ozone Season Allocati on Methodologies and the sulfur

dioxide (SO 2 

# ) Annual Trading Program.

On July 1, 2009, the Secretary of the Louisi ana Department of Environmental Quality

(LDEQ), Harold Leggett, Ph.D. requested review and approval into the Louisiana SIP of

revisions adopted on June 20, 2008, to the Louisiana CAIR NO X 

# Annual and Ozone

Season Allocation methodologies and the incorporat ion by reference dates of the CAIR

SO 2 

# Annual SIP.

This review will determine if the revisions to LAC 33:III.506 (A), (B), and (C) comply

with the Clean Air Act and EPA regulations and guidance.

# 4 II. Background for State Submittal

Summary of the Clean Air Interstate Rule

EPA published CAIR on May 12, 2005 (70 FR 25162) . In CAIR, EPA determined that

28 states and the District of Columbia contribute significantly to nonattainment and

interfere with maintenance of the 1997 national ambient air quality standards (NAAQS)

for fine particles (PM 2.5 

# ) and/or the 1997 8-hour ozone NAAQS in downwind states in

the eastern part of the country. As a result , EPA required those upwi nd states to revise

their SIPs to include control measures th at reduce emissions of sulfur dioxide (SO 2 

# ),

which is a precursor to PM 2.5 

# formation, and/or nitrogen oxides (NO X 

# ), which is a

precursor to both ozone and PM 2.5 

# formation. For jurisdictions that contribute

significantly to downwind PM 2.5 

# nonattainment, CAIR sets annual state-wide emission

reduction requirements (i.e., budgets) for SO 2 

# and NO X 

# . Similarly, for jurisdictions that

contribute significantly to 8-hour ozone nonattai nment, CAIR sets state-wide emission

budgets for NO X 

# for the ozone season (May 1 st 

# to September 30 th 

# ). Under CAIR, states

may implement these reduction requirements by participating in the EPA-administered

cap-and-trade programs or by adopti ng any other control measures.

Additionally, on April 28, 2006, EPA published two additional CAIR-related final rules

that added the states of Delaware and New Jers ey to the list of states subject to CAIR for

1997 PM 2.5 

# and announced EPA’s final decisions on reconsideration of five issues,

without making any substantive changes to the CAIR requirements. On October 19,

2007, EPA amended CAIR to clarify the defini tion of “cogeneration unit” and, thus, the

applicability of the CAIR trading program to cogeneration units.

EPA was sued by a number of parties on vari ous aspects of CAIR, and on July 11, 2008,

the DC Circuit Court found CAIR unlawful. North Carolina v. EPA , 531 F.3d 896 (DC

Cir. 2008). The Court's origin al decision vacated CAIR. Id. at 929-30. However, the

Court subsequently remanded CAIR to EP A without vacatur because it found that

allowing CAIR to remain in effect until it is replaced would preserve the environmental

values covered by CAIR. On August 8, 2011, EPA finalized its Cross State Air Pollution

Rule (Transport Rule) inte nded to replace the remanded CAIR. However, on August 21,

2012, the D.C. Circuit issued a deci sion vacating the Transport Rule. EME Homer City

Generation, L.P. v. EPA , 696 F.3d 7 (D.C. Cir. 2012). The Court again ordered EPA to

continue implementing CAIR in the interim pending promulgation of a replacement rule.

Subsequently, the Supreme Cour t granted the United States' petition for certiorari and

agreed to review the D.C. Circuit's decision in EME Homer City, and held oral arguments

on December 10, 2013. A decision is currently pending. In the meantime, EPA intends to

act in accordance with the D.C. Circuit’s instruction in EME Homer City to continue

implementing CAIR. CAIR requirements are in place, its regional control programs are

operating while EPA develops replacement ru les in response to the pertinent court

decisions, and CAIR requirements remain in ef fect for Louisiana. The instant actions

have no impact on the legal st atus of CAIR or CSAPR.

# 5 General Overview of CAIR Implementation

CAIR establishes State-wide emission budgets for SO 2 

# and NO X 

# and is to be

implemented in two phases. The first phase of NO X 

# reductions started in 2009 and

continues through 2014, while the first phase of SO 2 

# reductions started in 2010 and

continues through 2014. The second phase of reductions for both NO X 

# and SO 2 

# starts in

2015 and continues thereafter. CAIR requires States to implement the budgets by either:

(1) requiring EGUs to participate in the EPA- administered cap-and-trade programs; or (2)

adopting other control measures of the Stat e's choosing and demonstrating that such

control measures will result in comp liance with the applicable State SO 2 

# and NO X 

# budgets.

The May 12, 2005 and April 28, 2006, CAIR rules provide model rules that States must

adopt (with certain limited changes, if desire d) if they want to participate in the EPAadministered trading programs. With two excep tions, only States that choose to meet the

requirements of CAIR through methods that ex clusively regulate EGUs are allowed to

participate in the EPA-administ ered trading programs. One ex ception is for States that

adopt the opt-in provisions of the model rules to allow non-EGUs individually to opt into

the EPA-administered trading programs. Th e other exception applies to States that

choose to include all no n-EGUs from their NO X 

# SIP Call trading programs in their CAIR

NO X 

# ozone season trading programs. 1



# States have the flexibility to choose the type of control measures they use to meet the

requirements of CAIR. EPA antic ipated that most States w ould choose to meet the CAIR

requirements by selecting an option that re quires EGUs to participate in the EPAadministered CAIR cap-and-trade programs. For such States, EPA provides two

approaches for submitting and obtaining approval for CAIR SIP revisions. States may

submit full SIP revisions that adopt the mode l CAIR cap-and-trade rules. If approved,

these SIP revisions fully replace the CAIR FIPs. Alternatively, States may submit

abbreviated SIP revisions. These SIP revi sions do not replace th e CAIR FIPs; however,

the CAIR FIPs provide that, when approve d, the provisions in these abbreviated SIP

revisions be used instead of or in conj unction with, as approp riate, the corresponding

provisions of the CAIR FIPs (e.g., the NO X 

# allowance allocation methodology).

CAIR is scheduled to be implemented in two phases. The first phase of NO X 

# reductions

starts in 2009 and continues thr ough 2014, while the first phase of SO 2 

# reductions starts

in 2010 and continues through 2014. The sec ond phase of reductions for both NO X 

# and

SO 2 

# starts in 2015 and continues thereafter. The phased approach provides adequate lead

time for States to incorporate the new rule into State regulations and allows sources

sufficient time to comply with the new emissi on caps. Under CAIR, States will achieve

the required emissions reducti ons using one of two options for compliance: 1) require

fossil-fuel fired boilers to participate in an EPA-administered interstate cap and trade

1 

## Arkansas and Louisiana did not adopt opt-in provisions in the original CAIR SIP submittals. Arkansas

and Louisiana are not subject to the NO X 

## SIP Call. Therefore, the Ar kansas and Louisiana CAIR

regulations only pertain to EGUs.

# 6 system that caps emissions in two stages, or 2) meet an individual State air emission

limits through measures of the State's choosing.

The EPA-administered CAIR trading programs are based on the successful cap-and-trade

dynamics of the Acid Rain Program. EPA has established state emission budgets for

annual NO X 

# emissions, ozone season NO X 

# emissions, and SO 2 

# emissions. The state

budgets are in tons of pollutant and provide a cap for each state. Each state allocates the

emissions budgets for each pollutant to particip ating sources in the state. Participating

sources can choose to operate at their allocate d emissions level, above, or below it. If a

source chooses to operate above its allo cation amount then the source must obtain

additional allowances to demonstrate complian ce with the program. If a source chooses

to operate below its allocation amount then the source has a surplus of allowances that

can be sold to another participati ng source or banked for future use.

How does the Clean Air Interstate Rule NO X 

# Annual and Ozone Season Trading

Programs Work?

Under both the annual and ozone season NO X 

# trading programs, a CAIR allowance

represents the authorizat ion to emit one ton of NO X 

# , regardless of the CAIR phase in

which the allowance is allocated. Complian ce is demonstrated separately each control

period for both the annual NO X 

# and ozone season NO X 

# programs.

How does the Clean Air Interstate Rule SO 2 

# Trading Program Work?

The SO 2 

# model rule is designed to satisfy the ongoing statutory requirements of the Title

IV Acid Rain SO 2 

# cap and trade program. As a result, the model SO 2 

# cap and trade rule

builds on and coordinates with the Title IV SO 2 

# program to ensure that the required

reductions under CAIR are achieved while preserving the efficacy of the Title IV

program. The model CAIR SO 2 

# cap and trade program w ill utilize the Title IV

allowances for compliance at a ratio of 2 allo wances per ton of emissions for allowances

allocated for 2010 through 2014, and 2.86 allowances per ton of emissions for allowances

allocated for 2015 or thereafter. Title IV allowances will con tinue to be freely

transferable among sources covered by the Ac id Rain Program and sources covered by

the model SO 2 

# cap and trade program under CAIR. However, each Title IV allowance

used to comply with Title IV will be removed from the source’s allowance tracking

system and cannot be used again for co mpliance, either in the CAIR model SO 2 

# cap and

trade program or the Acid Rain Program.

# 7 III. Summary of State Submittal

On May 12, 2005, EPA found that Louisiana contri buted significantly to the transport of

8-hour ozone and PM 2.5 

# emissions to downwind counties in Alabama and Texas. Thus,

Louisiana was required to address CAIR requirements for NO X 

# annual, NO X 

# ozone

season, and SO 2 

# emissions. To address the concerns of interstate transport, the LDEQ

initiated a stakeholder process to work with affected industry and the Louisiana Public

Service Commission (LPSC).

LDEQ submitted a full CAIR SIP revision on September 22, 2006, that incorporated by

reference the CAIR SO 2 

# trading program at 40 CFR Pa rt 96, Subparts AAA – HHH. EPA

published a direct final a pproval of the LA CAIR SO 2 

# Trading Program on July 20, 2007.

See 72 FR 39741.

LDEQ submitted an abbreviated SIP revisi on for parallel processing on July 12, 2007, to

replace the allocation methodologies for the NO X 

# Annual and NO X 

# Ozone Season

Trading Programs. EPA approved th e abbreviated SIP revision for NO X 

# Annual and NO X 

# Ozone Season requirements on September 28, 2007. See 72 FR 55064.

Subsequent to our initial approvals of the SO 2 

# CAIR SIP and the abbreviated CAIR SIPs

for NO X 

# Annual and NO X 

# Ozone Season, the LDEQ has adopted revisions to the

Louisiana CAIR provisions. These revisions we re submitted as revisions to the Louisiana

SIP on July 1, 2009. Specifically, the LDEQ submitted the following revisions:

 CAIR NO X 

# Annual Abbreviated SIP Revision

o The LDEQ submitted revi sions to the CAIR NO X 

# Annual Abbreviated SIP

at LAC 33:III.506(A) Clean Air Inters tate Rule Requirements – Nitrogen

Oxide Annual Program. The LDEQ has revised the introductory paragraph

to state that the requirements of 40 CFR Part 97, Subparts AA – HH for

the CAIR NO X 

# Annual Trading Program, as revised on October 19, 2007,

continue to apply, except as m odified by the Louisiana CAIR NO X 

# Annual

abbreviated SIP.

o The abbreviated SIP revision for NO X 

# Annual Allocation methodology at

LAC 33.III.506(A) will continue to replace the requirements at 40 CFR

97.141 and 97.142 regarding Timing Requirements for CAIR NO X



# Allowance Allocations and CAIR NO X 

# Allowance Allocations.

o The LDEQ also submitted revisi ons to the Louisiana CAIR NO X 

# Annual

Allocation Methodology. These revisi ons are implemented through new

and amended definitions applicable to the Louisiana CAIR NO X 

# Annual

program at LAC 33:III.506(A)(1) and the provisions establishing the

allocation calculations at LAC 33:III.506(A)(2). Combined, these

revisions modify the Louisiana CAIR NO X 

# annual allocation methodology

to more equitably distribute allowanc es to certified and utility units and

add provisions to address allocations to repowered units. The submitted

revisions did not revise any of the SIP-approved requirements for

submittal of the allocations to EPA or revise the NO X 

# Annual budget for

Louisiana.

# 8  CAIR NO X 

# Ozone Season Abbreviated SIP Revision

o The LDEQ submitted revisions to the incorporation by reference date of

the CAIR NO X 

# Ozone Season Abbreviated SIP at LAC 33:III.506(B)

Clean Air Interstate Rule Requireme nts – Nitrogen Oxide Ozone Season

Program. The LDEQ has revised the in troductory paragraph to state that

the requirements of 40 CFR Part 97, Subparts AAAA – HHHH for the

CAIR NO X 

# Ozone Season Trading Program, as revised on October 19,

2007, continue to apply, except as m odified by the L ouisiana CAIR NO X



# Ozone Season abbreviated SIP.

o The abbreviated SIP revision for NO X 

# Ozone Season Allocation

methodology at LAC 33.III.506(B) will continue to replace the

requirements at 40 CFR 97.341 and 97.342 regarding Timing

Requirements for CAIR NO X 

# Ozone Season Allowance Allocations and

CAIR NO X 

# Ozone Season Allowan ce Allocations.

o The LDEQ also submitted revisi ons to the Louisiana CAIR NO X 

# Ozone

Season Allocation Methodology. These re visions are implemented through

new and amended definitions appli cable to the Louisiana CAIR NO X 

# Ozone Season program at LAC 33:I II.506(B)(1) and the provisions

establishing the alloca tion calculations at LAC 33:III.506(B)(2).

Combined, these revisions modify the Louisiana CAIR NO X 

# ozone season

allocation methodology to more equita bly distribute allowances to

certified and utility units and add pr ovisions to address allocations to

repowered units. The submitted revisions did not revise any of the SIPapproved requirements for submittal of the allocations to EPA or revise

the NO X 

# Ozone Season budget for Louisiana.

 CAIR SO 2 

# SIP Revision

o The LDEQ submitted a revision to th e Louisiana SIP for the CAIR SO 2 

# program to update the CAIR SO 2 

# program incorporation by reference

dates at LAC 33:III.506.C. In this section, the LDEQ incorporates by

reference the CAIR SO 2 

# program as published at 40 CFR Part 96 on July

1, 2007 and revised on October 19, 2007 at 72 FR 59190 – 59207.

# IV. Technical Review

This technical review of the July 1, 2 009, SIP revision for the Louisiana CAIR NO X 

# Annual and Ozone Season Trading Programs and the SO 2 

# Trading Program consists of a

comparison between the relevant CAA require ments and the corres ponding sections in

the SIP submittal. The submittal is first reviewed for completeness as a SIP submittal

under Part 51, Appendix V. Second, the CAIR revisions are reviewed using the SIP

requirements for CAIR specific requirement s and for CAIR trading program specific

requirements. Finally, a section-by-section review of the submittal in comparison to 40

CFR Part 51 is presented to determine whether the submittal satisfies the requirements

for preparation, adoption, and submittal of a SIP revision. These analyses produce a

written evaluation that was used to make a de termination of whether or not the July 1,

2009, Louisiana CAIR SIP Revisions for CAIR NO X 

# Annual and Ozone Season Trading

Programs and SO 2 

# Trading program was in agreem ent with the CAA and other EPA

policies or guidance.

A. Part 51, Appendix V Completeness Determination for the July 1, 2009, Louisiana

SIP Submittal

B. Evaluation of the July 1, 2009, SIP Revi sion with Respect to the Louisiana SIP

C. Evaluation of the July 1, 2009, SIP Revi sion with Respect to Section 110(l) of

CAA

# 10 A. Part 51, Appendix V Completeness Determination for the July 1, 2009,

Louisiana SIP Submittal

The criteria for completeness determination are found in Appendix V to Part 51 - Criteria

for determining the completeness of plan submissions and ar e outlined below:

1.0 Purpose: This appendix V sets forth th e minimum criteria for determining whether

a State implementation plan submitted for consideration by EPA is an official

submission for purposes of review under § 51.103.

1.1 The EPA shall return to the submitting offi cial any plan or revision thereof which

fails to meet the criteria set forth in this appendix V, and request corrective action,

identifying the component(s) absent or in sufficient to perform a review of the

submitted plan.

1.2 The EPA shall inform the submitting offici al whether or not a plan submission

meets the requirements of this appendix V within 60 days of EPA's receipt of the

submittal, but no later than 6 months after the date which the State was required to

submit the plan or revision. If a comple teness determination is not made by 6

months from receipt of a submittal, the submittal shall be deemed complete by

operation of law on the date 6 months from receipt. A determination of

completeness under this paragraph means that the submission is an official

submission for purposes of §51.103.

The attached checklist outlines the basi c criteria included under 2.1, 2.2, and 2.3 of

Appendix V.

# 11 SIP Completeness Checklist for the July 1, 2009, Louisiana SIP Revision

When preparing a SIP revision request, the SIP reviewer should go through this list to

help identify that the package submitted to EPA is complete. States can use the check list

to assure SIP submittals meet Appendix V criteria.

Administrative Materials (2.1)

1. The package is sent with a formal submitta l letter from the Governor or his or her

designee requesting EPA's approval of the revision.

The July 1, 2009, SIP revision was submitted by Harold Leggett, Ph.D. Secretary

of the Louisiana Department of Environmental Quality.

On May 22, 2008, Governor Jindal designated Harold Leggett, Ph.D., as his

designee for submitting SIP revisions.

2. Evidence is included that the State has a dopted the revision in the State code or

body of regulations, or that the State ha s issued the permit, order, consent

agreement (hereafter document) in final fo rm. This evidence would include the

date of adoption or final i ssuance and the effective date of revision, if different

from adoption/issuance date.

The revisions to LAC 33:III.506 were adopted by the LDEQ on June 20, 2008,

and published in the Louisiana Register, Volume 34, No. 06.

3. Evidence is included that the State has necessary legal authority under State law

to adopt and implement the revision, e .g., a citation of the appropriate State

authority.

The authority for promulgating changes to the Louisiana State Implementation

Plan, LAC 33:III.506 is found in the Envir onmental Quality act, R.S. 30:2001 et

seq., and in accordance with the provisions of the Administrative Procedure Act,

R.S. 49:950 et seq.

4. A copy is included of th e actual regulation or docum ent submitted for approval

and incorporation by reference into the SI P including an indication of the changes

made to the existing approved plan wher e applicable. The submittal shall be a

copy of the official State regulation document signed, stamped, and dated by the

appropriate State official i ndicating that it is fully enforceable by the State. The

effective date of the regulation document shall, whenever possible, be indicated in

the document itself.

The SIP submittal included a copy of the actual revisions to LAC 33:III.506.

# 12 5. Evidence is included that the State followe d all the procedural requirements of its

laws and/or its constitution in the conducting and completing the

adoption/issuance of the plan.

The Louisiana Register, Volume 34, Nu mber 6, published June 20, 2008, included

evidence that the SIP revisions were promulgated under the authority of the

Environmental Quality Act, R.S. 30:2001 et seq., and in accordance with the

provisions of the Administrative Pr ocedures Act, R.S. 49:950 et seq..

6. Evidence is included that public noti ce was given of the proposed changes

consistent with the procedures approved by EPA, including the date of publication

of such notice, (e.g., notarize d or certified copies of any public notices published

in newspapers). (The notice should be at least 30 days prior to the public

hearing(s).

Notices of public hearing for the SIP r evision and the revisions to LAC 33:III.506

were published on:

 March 12, 2008, in The Town Talk – Alexandria, LA;

 March 12, 2008, in The Times – Parish of Caddo, LA;

 March 13, 2008, in the Advocate – Baton Rouge, LA;

 March 14, 2008, in The Advertiser – Lafayette, LA;

 March 14, 2008, in the Lake Charles Am erican Press – Lake Charles, LA;

and

 March 14, 2008, in The NEWS-STAR – Monroe, LA.

Certification that the public hearing was held on April 24, 2008, was included.

7. A certification is included indicating that public hearin g(s) was/were held in

accordance with the information provided in the public notice(s) and the State's

laws and constitution, if applicable.

The public hearing for this proposed SI P revision was held on April 24, 2008.

Lori Overland was the Certified Court Reporter for the April 24, 2008, SIP public

hearing. She certified that the public hearing was conducted pursuant to R.S.

37:2551 et seq.

8. A compilation of public comments and the State's response is included.

LDEQ received one comment letter on this proposed SIP revision, from EPA

Region 6 on April 28, 2008. The comment le tter and the State’s response to

comments were included in the July 1, 2009 submittal package.

# 13 Technical Support (2.2)

The State should include the following techni cal information in its SIP revision request

package.

1. Identification of all regu lated pollutants affected by the revision is included.

This submittal is an abbreviated SIP r evision to replace the annual and ozone

season NO X 

# allocation methodologies under the CAIR NO X 

# Annual and Ozone

Season FIPs. This submittal also updates the incorporation by reference dates of

the CAIR SO 2 

# Annual Trading Program.

2. Identification of the locations of affected sources including the EPA

attainment/nonattainment de signation of the locations and the status of the

attainment plan for the aff ected area(s) is included.

Owners and operators of NO X 

# and SO 2 

# sources located in Louisiana will meet the

Louisiana methodology for alloca tion of annual and ozone season NO X 

# allowances and requirements of the CAIR SO 2 

# trading program.

3. Quantification of the changes in SIP allowable emissions from the affected

sources is included. (Examples include estimates of changes in current actual

emissions from affected sources and/or , where appropriate, quantification of

changes in actual emissions from affect ed sources through calculations of the

differences between certain baseline levels and allowable emissions anticipated if

the revisions were approved.)

The Louisiana Department of En vironmental Quality adopted LAC

33:III.506(A)(2) and (B)(2) that establish the statewide NO X



# annual and ozone

season emission budgets will be equivalent to the tons of NO X 

# emissions listed for

Louisiana in the state annual and ozone season trading budgets under 40 CFR

51.123 and parts 97.140 and 97.340. EPA’s technical support for CAIR provided

the estimated change in actual NOx emi ssions from the affected sources. The

adopted state budgets have not been change d in the July 1, 2009, SIP revision.

The LDEQ has incorporated by reference the CAIR SO 2 

# Trading Program, which

establishes a statewide cap on SO 2 

# emissions per the state emissions budget at 40

CFR 51.124(e)(2). This stat e budget has not been c hanged in the July 1, 2009,

SIP revision.

4. Demonstration is included that the NAAQS/PSD increments/RFP demonstration

and visibility as applicable would be pr otected if the revision were approved and

implemented.

Not applicable to this SIP submittal EPA provided demonstration in the May 12,

2005, final CAIR that the cap and trade m echanisms would provide for a decrease

# 14 in emission levels on a national l evel (70 FR 25195 and its accompanying

technical support).

5. FOR REDESIGNATIONS:

a. Is there a fully approved maintena nce plan for the primary ambient air

quality standards for at least 10 years as requir ed by §175A of the Clean

Air Act?

Not applicable.

b. Are contingency measures included?

Not applicable.

6. Modeling information, if app licable, is required to s upport the proposed revision.

EPA provided modeling information in the development and proposal of the CAIR

programs; this modeling supported the incl usion of the State of Louisiana in

CAIR.

7. Evidence is included where necessary, that emission limitations are based on

continuous emission reduction t echnology (e.g., add-on controls,

industrial/process equipment designs, reformulated materials, etc.).

Evidence of emission limitations based on CEM technology is not applicable.

However, Louisiana remains subject to the CAIR NO X



# Annual and Ozone Season

FIP requirements for monitoring and re porting at 40 CFR part 97, subparts HH

and HHHH; which specify compliance with the requirements in 40 CFR part 75.

The Louisiana SIP also incorporates by reference the federal requirements for the

CAIR SO 2 

# Trading Program, including the requirements for monitoring and

reporting at 40 CFR part 96, subparts HHH, which require Part 75 CEM

monitoring and recordkeeping..

8. Evidence is included indicating that a SI P revision contains emission limitations,

work practice standards, and recordk eeping/reporting requirements to ensure

stated emission levels.

The State’s rules are clear about what enti ties are affected, the dates by which the

LDEQ must submit the NOx annual and ozone season allocations to EPA, and the

methods the LDEQ will use in calculating the allocations. The methodology for

calculating an affected entity’s NOx annual and ozone season allowances is

# 15 replicable because the methodology reli es on the heat input and emissions

determined from monitoring and recordkeep ing requirements in 40 CFR part 75.

The State’s rules also incorpor ate by reference the CAIR SO 2 

# Trading Program

requirements, which require monitoring and recordkeeping as specified in 40

CFR Part 75.

9. Compliance/enforcement strategies including how compliance will be determined

in practice (including at what frequency).

Not applicable for this abbreviated SIP revision. Determination of compliance is

specified on a case-by-case basis in each individual permit. Each individual

permit holder is required to hold sufficient allowances at the end of each control

period to cover the total amount of NO X 

# annual, NO X 

# ozone season, and SO 2 

# tons

emitted.

10. As appropriate, special economic and tec hnological jus tifications are included per

applicable EPA policies or an explana tion why such justifications are not

necessary should be included. For exampl e, requests for alternative RACT may

require such justification.

These justifications are not applicable for this SIP revision. EPA provided

economic and technical analyses in th e development of the CAIR SIP and FIP

programs.

Exceptions (2.3)

The EPA, for purposes of expediting the revi ew of the plan, has adopted a procedure

referred to as “parallel proces sing.” Parallel processing allo ws a State to submit the plan

prior to actual adoption by the State and provides an opportunity for the State to consider

EPA comments prior to submission of a fi nal plan for final review and action.

LDEQ did not request parallel proce ssing of the July 1, 2009, SIP revision.

The July 1, 2009, Louisiana SIP Submittal meet s the completeness criteria at Part

51, Appendix V, Sections 2.1 – 2.3.

# 16 B. Evaluation of the July 1, 2009, Submitta l with Respect to the Louisiana SIP

Louisiana is subject to the requirements of 40 CFR 51.123(e) – (cc) for control of annual

and ozone season NO X 

# . Louisiana chose to adopt an abbreviated CAIR SIP revision

satisfying the requirements of 40 CFR 51.123( p) and (ee). EPA fully approved the

Louisiana abbreviated CAIR SIPs for annual and ozone season NO X 

# on September 28,

2007. See 72 FR 55064. The record for this deci sion includes EPA’s analysis of how the

Louisiana CAIR NO X 

# Annual and Ozone Season Abbreviated SIPs at LAC 33:III.506(A)

and (B) satisfy all required el ements of the CAA and CAIR.

Louisiana is subject to th e requirements of 40 CFR 51.124(e) – (o) for the control of

annual sulfur dioxide emissions. Louisiana chose to adopt a full CAIR SIP revision

incorporating by reference th e federal requirements at 40 CFR Part 96, Subparts AAA

through HHH. On July 20, 2007, EPA approved the Louisiana CAIR SO 2 

# SIP as fully

implementing the annual SO 2 

# requirements of CAIR by requiring certain EGUs to

participate in the EPA-administered CAIR cap-and-trade program for SO 2 

# emissions. See

72 FR 39741. The record for this decision incl udes EPA’s analysis of how the Louisiana

CAIR SO 2 

# Program at LAC 33:III.506(C) satisfies all required elements of the CAA and

CAIR.

The July 1, 2009, SIP submittal amends the existing SIP-approved CAIR NO X 

# annual

and ozone season allocation me thodologies and the CAIR SO 2 

# trading program, but did

not replace any of the fundamental elements of the approved Louisiana CAIR programs.

As such, EPA is not going to evaluate the ba sis for our original a pprovals of the CAIR

NO X 

# or SO 2 

# programs in this TSD. Rather, this review focuses on the changes submitted

on July 1, 2009, to the existing Louisiana SIP and whether these cha nges are consistent

with the CAA and EPA’s regulations and guidance pertaining to CAIR.

The following table provides a line item ev aluation of each of the submitted revisions

against the SIP-approved Louisiana CAIR programs. As evidenced in Table 1, the

revisions adopted and submitted for the Louisiana CAIR NO X 

# annual, NO X 

# ozone season

and SO 2 

# programs are approvable. These revisions substantively revise the incorporation

by reference dates to reflect the mo st recent federal changes. The NO X 

# annual and NO X 

# ozone season allocation methodologies have also been substantively revised to update the

allocation methodology based on comments and LDEQ’s own evaluation of the

functionality of the original methodology. These allocation methodology revisions do not

change the underlying timing or budget c onstraints imposed upon the LA programs by

the FIPs at 40 CFR Part 97. Therefore, th e revisions to the methodology are approvable.17Table 1: Analysis of July 1, 2009,Revisions to the Louisiana SIPSIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009Section 506(A). Clean Air Interstate RuleRequirements—Nitrogen Oxide Annual Program.(A).Clean Air Interstate Rule (CAIR) Nitrogen Oxide (NOx) AnnualProgram. This Subsection is adopted in lieu of 40 CFR 97.141 and97.142 as promulgated under the CAIR Federal Implementation Plan(FIP) NOx Annual Trading Program on April 28, 2006, at 71 FR25328. All provisions of 40 CFR Part 97, Subparts AA - HH, continue toapply, with the exception of §97.141 (Timing Requirements for CAIRNOx Allowance Allocations) and §97.142 (CAIR NOx AllowanceAllocations). The provisions of this Subsection state how the CAIR NOxannual allowances shall be allocatedin accordance with this Section and40 CFR 97.144(a).(A).Clean Air Interstate Rule (CAIR) Nitrogen Oxide (NOx) AnnualProgram. This Subsection is adopted in lieu of 40 CFR 97.141 and97.142 as promulgated under the CAIR Federal Implementation Plan(FIP) NOx Annual Trading Program on April 28, 2006, at 71 FR 25328 –255469 and as amended on October 19, 2007 at 72 FR 59190-59207. Allprovisions of 40 CFR Part 97, Subparts AA - HH, continue to apply, withthe exception of §97.141 (Timing Requirements for CAIR NOxAllowance Allocations) and §97.142 (CAIR NOx AllowanceAllocations). The provisions of this Subsection state how the CAIR NOxannual allowances shall be allocatedin accordance with this Section and40 CFR 97.144(a).The revisions to LAC 33:III.506(A) are approvable. These substantiverevisions updates the promulgation date of federal requirements to beconsistent with current federal CAIR regulations.1.Definitions. The terms used in Subsection A of this Section have themeaning given to them in the CAIR FIP (40 CFR Part 97 aspromulgated on April 28, 2006), except for those terms definedherein.No changeNo comparable definition in SIP Certified Unit – an electricity generating unit that has been certified by theLPSC or approved by a municipal authority but was not in operation on, orapproved by, December 31, 2004.This new definition is approvable. This non-substantive revision moves theSIP-approved definition of “certified unit” from the repealed definition of“certified unit or contract.”Certified Unit or Contract -- an electricity-generating unit or contract that hasbeen certified by the LPSC or approvedby a municipal authority but was notin operation on, or approved by, December 31, 2004.REPEALEDCertified Unit or Contract -- an electricity-generating unit or contract that hasbeen certified by the LPSC or approvedby a municipal authority but was notin operation on, or approved by, December 31, 2004.The repeal of the SIP-approved definition of “Certified Unit or Contract” isapprovable. The LDEQ has revised the allocation methodology for the18SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009Annual NOXabbreviated SIP to not rely on the definition of certified contract– therefore the LDEQ is repealing an unused provision from the Louisianaregulations. Additionally, the SIP-approved portion of the definitionpertaining to “certified unit” has been moved to its own stand-alonedefinition.Department –- the Louisiana Department of Environmental Quality. No changeNo comparable definition in SIP Electric Public Utility– any person furnishing electric service within thisstate, including any electric cooperativetransacting business in this state,provided, however, that the term shall not be construed to apply to any cogenerator who consumes any or all ofthe electric power and energy that itgenerates or to any independent power producer who sells its entireproduction of electric power and energy to anelectric public utilityas hereindefined.The new definition “electric public utility” is approvable. This definition isnecessary to implement the Louisiana Annual NOXallocation methodology.No comparable definition in SIP Fuel Types – for the allocation of allowances under Louisiana’s program,fueltypes,include solid, gaseous, or liquid fuel. The following definitions applytofuel types.i.Solid Fuel– includes, but is not limited to, coal and petroleum coke.Any amount of solid fuel that is combusted, alone, in series, or incombination with any other fuel during any control period shall meetthe definition of solid fuel.ii.Gaseous Fuel -includes, but is not limited to, natural gas, propane,coal gas, and blast furnace gas. Any mixture containing at least 50percent of gaseous fuel that is combusted with any liquid fuel duringany control period shall meet the definition of gaseous fuel.iii.Liquid Fuel –includes but is not limited to, petroleum-based oilsand glycerols.The new definition “fuel types” is approvable. This definition is necessary toimplement the Louisiana Annual NOXallocation methodology.LPSC -- the Louisiana PublicService Commission. No changeLPSC or Municipal Certification -- the process under which the LPSCcertifies, or the relevant municipalauthority approves, an electricityLPSC or Municipal Certification -- the process under which the LPSCcertifies, or the relevant municipal authority approves, construction,19SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009generating facility and/or all of its component units, additions, and up-rated orre-powered units as being in the public convenience and necessity. Thisprocess includes the certification or approval of long-term contracts thatdedicate a portion of the electrical output of any generation facility to a utilityunit. Long-term contracts are those contracts of at least one year in duration,provided that the municipality or utility unit expects to receive power underthe contract within one yearof the contract execution.conversion, or repowering of an electricity-generating unit as being in thepublic convenience and necessity. an electricity-generating facility and/or allof its component units, additions, and up-rated or re-powered units as beingin the public convenience and necessity. This process includes thecertification or approval oflong-term contracts that dedicate a portion of theelectrical output of any generation facility to a utility unit. Long-termcontracts are those contracts of at leastone year in duration, provided that themunicipality or utility unit expects to receive power under the contract withinone year of the contract execution.The revisions to the definition “LPSC or Municipal Certification” areapprovable. This definition has been revised to account for the revisedallocation methodology. This revised definition is necessary to implement theLouisiana Annual NOXallocation methodology.Municipal Authority -- a municipal corporation, public power authority, orother political subdivision including, but not limited to, the Louisiana Energyand Power Authority.No change.Non-Utility Unit -- an electricity-generating unit that has not been certified bythe LPSC or approved by a municipal authority, and that does not have aneffective and active long-term contract with a utility unit. This includes, butis not limited to, units owned by independent power producers (IPPs) that arethe owners or operators of electricity-generating units that produce electricityfor sale, and cogeneration units as defined in 40 CFR Part 97.No changeUtility Unit -- a certified unit that is inoperation, a previously-operationalcertified unit, or a non-utility unit thathas an effective and active long-termcontract with a utility unit. Long-term contracts are those contracts of at leastone year in duration, provided that the municipality or utility unit expects toreceive power under the contract withinone year of the contract execution.Utility Unit -- a certified unit that is inoperation, a previously-operationalcertified unit, a non-utility unit purchased by an electric public utility, or anon-utility unit that has an effective and active long-term contract with autility unit. Long-term contracts are those contracts of at least one year induration, provided thatthe municipality or utilityunit expects to receivepower under the contract within oneyear of the contract execution.The revisions to the definition “Utility Unit” are approvable. This definitionhas been revised to account for the revised allocation methodology. Thisrevised definition is necessary toimplement the Louisiana Annual NOXallocation methodology.20SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 20092.Allocation of CAIR NOx Annual Allowances. Total NOxallowances allocated per control period shall not be in excess of theCAIR NOx annual budget as found in 40 CFR 97.140 (35,512 tonsper control period from 2009-2014 and 29,593 tons per controlperiod thereafter).No changea.Non-Utility Units. For each CAIR non-utility unit, the NOxallowances shall be equal to the average of the actual NOxannual emissions of the three calendar years immediatelypreceding the year in which thecontrol period allocations aresubmitted to the administrator. The actual NOx annualemissions as reported in the emission inventory required byLAC 33:III.919 shall be used, except that the allowancessubmitted in 2007 shall use the actual NOx emissions forcalendar years 2002, 2003, and 2004. When data is notavailable in the emission inventory, data reported to the FederalAcid Rain Program shall be used. When actual reported NOxannual emissions data are available for only two of the threecalendar years immediatelypreceding the deadline forsubmission of the control period allocations, the average of theactual reported NOx annual emissions data for those two yearsshall be used. When actual reported NOx annual emissions dataare available for only one of thethree calendar years, the actualreported NOx annual emissions data for that one year shall beused. When no actual reported NOx annual emissions data forany of the three calendar years areavailable, no allocations shallbe made under this Paragraph.No changeb.Certified Units. A certified unit subject to CAIR shall beallocated NOx allowances for the control period in which theunit will begin operation, and foreach successive control period,for which no NOx allowances have been previously allocateduntil operating data are available for the three calendar yearsimmediately preceding the deadline for submission of thecontrol period allocations. Until a unit has three calendar yearsof operating data immediatelypreceding the allocation submittaldeadline, the converted heat inputas calculated in Clause A.2.b.ib.Certified Units. A certified and permitted unit subject to CAIRshall be allocated NOx allowancesfor the control period in whichthe unit will begin operation,and for each successive controlperiod, for which no NOx allowances have been previouslyallocated until operating data are available for the three calendaryears immediately preceding thedeadline for submission of thecontrol period allocations. Until a unit has three calendar years ofoperating data immediately preceding the allocation submittaldeadline, the converted heat input ascalculated in Clause A.2.b.i or21SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009or ii of this Section shall be used to allocate allowances for theunit. The certified unit shall be treated as a utility unit for thepurposes of this allocation, except that converted heat input shallbe used instead of adjusted heat input. Converted heat input iscalculated as follows.ii of this Section shall be used to allocate allowances for theunit. The certified unit shall be treated as a utility unit for thepurposes of this allocation, except that converted heat input shall beused instead of adjusted heat input. Repowered utility units will beallocated in the same manner as certified units in the control periodof certification. Converted heatinput is calculated as follows.The revisions to LAC 33:III.506(A)(2)(b) are approvable. These substantiverevisions to the Louisiana Annual NOXallocation methodology revise themethodology consistent with LDEQ’s intent and stakeholder comments. TheCAIR abbreviated SIP requirements give states latitude in structuring anallocation methodology that best suits the needs of the respective state. Therevisions submitted by the LDEQ do notalter any of the timing requirementsfor assigning the allocations or submitting these allocations to EPA.i.For a coal-fired unit, the hourly heat input for a specifiedcalendar year shall equal the control period gross electricaloutput, including the capacity factor, of the generator(s)served by the unit multiplied by 7,900 BTU/KWh anddivided by 1,000,000 BTU/MMBTU. The control periodgross electrical output as stated in the documentationpresented for the LPSC or municipal certification shall beused in this calculation. If a generator is served by two ormore units, then the gross electrical output of the generatorshall be attributed to each unit in proportion to the unit’sshare of the total control period heat input of all the unitsfor the year.i.For a solid fuel-fired coal-fired unit, the hourly heat input for aspecified calendar year shall equal the control period grosselectrical output, including the capacity factor, of the generator(s)served by the unit multiplied by 7,900 BTU/KWh and divided by1,000,000 BTU/MMBTU. The control period gross electricaloutput as stated in the documentation presented for the LPSC ormunicipal certification shall be usedin this calculation. If agenerator is served by two or more units, then the gross electricaloutput of the generator shall beattributed to each unit inproportion to the unit’s share of the total control period heat inputof all the units for the year.The revisions to LAC 33:III.506(A)(2)(b)(ii) are approvable. Thesesubstantive revisions to the Louisiana Annual NOXallocation methodologyrevise the methodology consistent with LDEQ’s intent and stakeholdercomments. The CAIR abbreviated SIP requirements give states latitude instructuring an allocation methodology that best suits the needs of therespective state. The revisions submittedby the LDEQ do not alter any of thetiming requirements for assigning the allocations or submitting theseallocations to EPA.22SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009ii.For a non-coal-fired unit, the hourly heat input for aspecified calendar year shall equal the control period grosselectrical output, includingthe capacity factor, of thegenerator(s) served by the unit multiplied by 6,675BTU/KWh and divided by 1,000,000 BTU/MMBTU. Thecontrol period gross electricaloutput as stated in thedocumentation presented for the LPSC or municipalcertification shall be used in this calculation. If a generatoris served by two or more units, then the gross electricaloutput of the generator shall beattributed to each unit inproportion to the unit’s share of the total control period heatinput of all the units for the year.ii.For a gaseous or liquid fuel-fired unit non-coal-fired unit, thehourly heat input for a specifiedcalendar year shall equal thecontrol period gross electricaloutput, including the capacityfactor, of the generator(s) served by the unit multiplied by 6,675BTU/KWh and divided by 1,000,000 BTU/MMBTU. Thecontrol period gross electricaloutput as stated in thedocumentation presented for the LPSC or municipal certificationshall be used in this calculation. If a generator is served by twoor more units, then the gross electrical output of the generatorshall be attributed to each unit in proportion to the unit’s share ofthe total control period heat input of all the units for the year.The revisions to LAC 33:III.506(A)(2)(b)(iii) are approvable. Thesesubstantive revisions to the Louisiana Annual NOXallocation methodologyrevise the methodology consistent with LDEQ’s intent and stakeholdercomments. The CAIR abbreviated SIP requirements give states latitude instructuring an allocation methodology that best suits the needs of therespective state. The revisions submittedby the LDEQ do not alter any of thetiming requirements for assigning the allocations or submitting theseallocations to EPA.c.Utility Units. The department shall allocate CAIR NOxallowances to each CAIR utilityunit by multiplying the CAIRNOx budget for Louisiana (40 CFR 97.140), minus theallowances allocated under Subparagraph A.2.a of this Section,by the ratio of the adjusted baseline heat input of the CAIRutility unit and/or converted heat input of a certified unit to thetotal amount of adjusted baseline heat input and converted heatinput of all CAIR utility units and certified units in the state androunding to the nearest whole allowance. The adjusted baselineheat input (in MMBTU) used with respect to the CAIR NOxannual allowance for each CAIR utility unit shall be establishedas follows.c.Utility Units. The department shallallocate CAIR NOx allowances toeach CAIR utility unit by multiplying the CAIR NOx budget forLouisiana (40 CFR 97.140), minus the allowances allocated underSubparagraph A.2.a of this Section, by the ratio of the adjustedbaseline heat input of the CAIR utility unit and/or converted heatinput of a certified unit to the total amount of adjusted baseline heatinput and converted heat input of all CAIR utility units and certifiedunits in the state and rounding tothe nearest whole allowance. Theadjusted baseline heat input (in MMBTU) used with respect to theCAIR NOx annual allowance for each CAIR utility unit shall beestablished as follows.The revisions to LAC 33:III.506(A)(2)(c) are approvable. These substantiverevisions to the Louisiana Annual NOXallocation methodology revise themethodology consistent with LDEQ’s intent and stakeholder comments. The23SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009CAIR abbreviated SIP requirements give states latitude in structuring anallocation methodology that best suits the needs of the respective state. Therevisions submitted by the LDEQ do notalter any of the timing requirementsfor assigning the allocations or submitting these allocations to EPA.i.The average of the unit’s control period adjusted heat inputfor the three calendar years immediately preceding thedeadline for submission of allocations to the administratorshall be used (except that the allocation submitted in 2007shall use the average of the control period adjusted heatinput for calendar years 2002, 2003, and 2004), with thecontrol period adjusted heatinput for each year calculatedas follows.No changea)If the unit is coal-fired during a year, the unit’s controlperiod heat input for that year shall be multiplied by100 percent.b)If the unit is oil-fired during a year, the unit’s controlperiod heat input for that year shall be multiplied by 60percent.c)If the unit is not subject to Subclause A.2.c.i.(a) or (b)of this Section, the unit’s control period heat input forthe year shall be multiplied by 40 percent.a)If the unit is solid fuel-fired coal-fired during a year, theunit’s control period heat input for that year shall bemultiplied by 100 percent.b)If the unit is liquid fuel-fired oil-fired during a year, theunit’s control period heat input for that year shall bemultiplied by 60 percent.c)NO CHANGEThe revisions to LAC 33:III.506(A)(2)(c)(i) are approvable. Thesesubstantive revisions to the Louisiana Annual NOXallocation methodologyrevise the methodology consistent with LDEQ’s intent and stakeholdercomments. The CAIR abbreviated SIP requirements give states latitude instructuring an allocation methodology that best suits the needs of therespective state. The revisions submittedby the LDEQ do not alter any of thetiming requirements for assigning the allocations or submitting theseallocations to EPA.ii.A unit’s control period heat input, status as coal-fired or oilfired, and total tons of NOx emissions during a calendaryear shall be determined in accordance with 40 CFR Part 97and reported in accordance with LAC 33:III.919.ii.A unit’s control period heat input, fuel type, status as coal-firedor oil-fired, and total tons of NOx emissions during a calendaryear shall be determined in accordance with 40 CFR Part 97and reported in accordance with LAC 33:III.919.The revisions to LAC 33:III.506(A)(2)(c)(ii) are approvable. Thesesubstantive revisions to the Louisiana Annual NOXallocation methodology24SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009revise the methodology consistent with LDEQ’s intent and stakeholdercomments. The CAIR abbreviated SIP requirements give states latitude instructuring an allocation methodology that best suits the needs of therespective state. The revisions submittedby the LDEQ do not alter any of thetiming requirements for assigning the allocations or submitting theseallocations to EPA.3.Timing Requirements for CAIR NOx Annual Allowance Allocations NO CHANGEa.By April 30, 2007, the department shall submit to theadministrator the CAIR NOx annual allowance allocations, in aformat prescribed by the administrator and in accordance withParagraph A.2 of this Section, for the control periods in 2009,2010, and 2011.NO CHANGEb.By October 31, 2008, for the year 2012, and by October 31 ofeach year thereafter, the department shall submit to theadministrator CAIR NOx annual allowance allocations, in aformat prescribed by the administrator and in accordance withParagraph A.2 of this Section, for the control period in thefourth year after the year ofthe applicable deadline forsubmission under this Section.NO CHANGENO COMPARABLE PROVISION IN SIP 4.Reclassification of Units. When the ownership of a unit is transferred,the unit is reclassified accordingly as a utility or non-utility unit. Thedepartment will allocate future allowances using the new classification,beginning with the allocation submission deadline after the effectivedate of the unit reclassification. The electric public utility must notifythe department of the transfer of ownership. No changes will be madewithout written notification from the electric public utility.The new provisions at LAC 33:III.506(A)(4) are approvable. Thesesubstantive revisions to the Louisiana Annual NOXallocation methodologyrevise the methodology consistent with LDEQ’s intent and stakeholdercomments. The CAIR abbreviated SIP requirements give states latitude instructuring an allocation methodology that best suits the needs of therespective state. The revisions submittedby the LDEQ do not alter any of thetiming requirements for assigning the allocations or submitting theseallocations to EPA.25SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009Section 506(B). Clean Air Interstate Rule Requirements—Nitrogen Oxide Ozone Season Program.(B).Clean Air Interstate Rule (CAIR)Nitrogen Oxide (NOx) Ozone SeasonProgram. This Subsection is adopted in lieu of 40 CFR 97.341 and97.342 as promulgated under the CAIR Federal Implementation Plan(FIP) NOx Ozone Season Trading Program on April 28, 2006, at 71 FR25328. All provisions of 40 CFR Part 97, Subparts AAAA – HHHH,continue to apply, with the exception of §97.341 (Timing Requirementsfor CAIR NOx Ozone Season Allowance Allocations) and §97.342(CAIR NOx Ozone Season Allowance Allocations). The provisions ofthis Subsection state how the CAIR NOx ozone season allowances shallbe allocated in accordance with this Section and 40 CFR 97.343(a).(B).Clean Air Interstate Rule (CAIR)Nitrogen Oxide (NOx) Ozone SeasonProgram. This Subsection is adopted in lieu of 40 CFR 97.341 and97.342 as promulgated under the CAIR Federal Implementation Plan(FIP) NOx Ozone Season Trading Program on April 28, 2006, at 71 FR25328-25469 and as amended on October 19, 2007, at 72 FR 59190 -59207. All provisions of 40 CFR Part 97, Subparts AAAA – HHHH,continue to apply, with the exception of §97.341 (Timing Requirementsfor CAIR NOx Ozone Season Allowance Allocations) and §97.342(CAIR NOx Ozone Season Allowance Allocations). The provisions ofthis Subsection state how the CAIR NOx ozone season allowances shallbe allocated in accordance with this Section and 40 CFR 97.343(a).The revisions to LAC 33:III.506(B) are approvable. These substantiverevisions update the promulgation date of federal requirements to beconsistent with current federal CAIR regulations.1.Definitions. The terms used in Subsection B of this Section have themeaning given to them in the CAIR FIP (40 CFR Part 97 aspromulgated on April 28, 2006), and in Paragraph A.1 of thisSection.NO CHANGE2.Allocation of CAIR NOx Ozone Season Allowances. Total NOxozone season allowances allocated per control period shall not be inexcess of the CAIR NOx ozone season budget as found in 40 CFR97.340 (17,085 tons per control period from 2009-2014 and 14,238tons per control period thereafter).NO CHANGEa.Non-Utility Units. For each CAIR non-utility unit, the NOxallowances shall be equal to the average of the actual NOxozone season emissions of thethree calendar years immediatelypreceding the year in which thecontrol period allocations aresubmitted to the administrator. The actual NOx ozone seasonemissions as reported in the emission inventory required byLAC 33:III.919 shall be used, except that the allowancessubmitted in 2007 shall use the actual NOx emissions forcalendar years 2002, 2003, and 2004 that were reported to theFederal Acid Rain Program. When data is not available in theNO CHANGE26SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009emission inventory, data reported to the Federal Acid RainProgram shall be used. When actual reported NOx ozoneseason emissions data are available for only two of the threecalendar years immediatelypreceding the deadline forsubmission of the control period allocations, the average of theactual reported NOx ozone season emissions data for those twoyears shall be used. When actual reported NOx ozone seasonemissions data are available foronly one of the three calendaryears, the actual reported NOx ozone season emissions data forthat one year shall be used.When no actual reported NOxozone season emissions data forany of the three calendar yearsare available, no allocations shall be made under this Paragraph.b.Certified Units. A certified unit subject to CAIR shall beallocated NOx allowances for the ozone season of the controlperiod in which the unit will begin operation, and for eachsuccessive ozone season in a control period, for which no NOxallowances have been previously allocated until ozone seasonoperating data are available for the three calendar yearsimmediately preceding the deadline for submission of thecontrol period allocations. Until a unit has three years of ozoneseason operating data preceding the allocation submittaldeadline, the converted heat inputas calculated in Clause B.2.b.ior ii of this Section shall be used to allocate ozone seasonallowances for the unit. The certified unit shall be treated as autility unit for purposes of this allocation, except that ozoneseason converted heat input shall be used instead of ozoneseason adjusted heat input. Ozone season converted heat inputis calculated as follows.b.Certified Units. A certified and permitted unit subject to CAIRshall be allocated NOx allowances for the ozone season of thecontrol period in which the unitwill begin operation, and for eachsuccessive ozone season in a control period, for which no NOxallowances have been previously allocated until ozone seasonoperating data are available for the three calendar yearsimmediately preceding the deadlinefor submission of the controlperiod allocations. Until a unit has three years of ozone seasonoperating data preceding the allocation submittal deadline, theconverted heat input as calculatedin Clause B.2.b.i or ii of thisSection shall be used to allocate ozone season allowances for theunit. The certified unit shall be treated as a utility unit for purposesof this allocation, except that ozone season converted heat inputshall be used instead of ozone season adjusted heatinput. Repowered utility units will be allocated in the same manneras certified units in the control period of certification. Ozone seasonconverted heat input is calculated as follows.The new provisions at LAC 33:III.506(B)(2)(b) are approvable. Thesesubstantive revisions to the Louisiana Ozone Season NOXallocationmethodology revise the methodology consistent with LDEQ’s intent andstakeholder comments. The CAIR abbreviated SIP requirements give stateslatitude in structuring an allocation methodology that best suits the needs of27SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009the respective state. The revisions submitted by the LDEQ do not alter any ofthe timing requirements for assigning the allocations or submitting theseallocations to EPA.i.For a coal-fired unit, the hourly heat input for a specifiedcalendar year shall equal the control period gross electricaloutput, including the capacity factor, of the generator(s)served by the unit multiplied by 7,900 BTU/KWh anddivided by 1,000,000 BTU/MMBTU and multiplied by5/12. The control period gross electrical output as stated inthe documentation presented for the LPSC or municipalcertification shall be used in this calculation. If a generatoris served by two or more units, then the gross electricaloutput of the generator shall beattributed to each unit inproportion to the unit’s share of the total control period heatinput of all the units forthe specified ozone season.i.For a solid fuel-fired unit coal-fired unit, the hourly heat inputfor a specified calendar year shall equal the control periodgross electrical output, including the capacity factor, of thegenerator(s) served by the unit multiplied by 7,900 BTU/KWhand divided by 1,000,000 BTU/MMBTU and multiplied by5/12. If the control period gross electrical output isunavailable, the hourly heat input for a specified calendar yearshall equal the annual grosselectrical output, including thecapacity factor, of the generator(s) served by the unitmultiplied by 7,900 BTU/KWh and divided by 1,000,000BTU/MMBTU, and multiplied by 5/12. The control periodgross electrical output as statedin the documentation presentedfor the LPSC or municipal certification shall be used in thiscalculation. If a generator is served by two or more units, thenthe gross electrical output of the generator shall be attributed toeach unit in proportion to the unit’s share of the total controlperiod heat input of all the units for the specified ozone season.The new provisions at LAC 33:III.506(B)(2)(b)(i) are approvable. Thesesubstantive revisions to the Louisiana Ozone Season NOXallocationmethodology revise the methodology consistent with LDEQ’s intent andstakeholder comments. The CAIR abbreviated SIP requirements give stateslatitude in structuring an allocation methodology that best suits the needs ofthe respective state. The revisions submitted by the LDEQ do not alter any ofthe timing requirements for assigning the allocations or submitting theseallocations to EPA.ii.For a non-coal-fired unit, the hourly heat input for aspecified calendar year shall equal the control period grosselectrical output, includingthe capacity factor, of thegenerator(s) served by the unit multiplied by 6,675BTU/KWh and divided by 1,000,000 BTU/MMBTU andmultiplied by 5/12. The control period gross electricalii.For a gaseous or liquid fuel-fired unit non-coal-fired unit, thehourly heat input for a specifiedcalendar year shall equal thecontrol period gross electricaloutput, including the capacityfactor, of the generator(s) served by the unit multiplied by6,675 BTU/KWh and divided by 1,000,000 BTU/MMBTU andmultiplied by 5/12. If the control period gross electrical output28SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009output as stated in the documentation presented for theLPSC or municipal certification shall be used in thiscalculation. If a generator is served by two or more units,then the gross electrical output of the generator shall beattributed to each unit in proportion to the unit’s share ofthe total control period heat input of all the units for thespecified ozone season.is unavailable, the hourly heatinput for a specified calendaryear shall equal the annual gross electrical output, includingthe capacity factor, of the generator(s) served by the unitmultiplied by 6,675 BTU/KWh and divided by 1,000,000BTU/MMBTU, and multiplied by 5/12. The control periodgross electrical output as statedin the documentation presentedfor the LPSC or municipal certification shall be used in thiscalculation. If a generator is served by two or more units, thenthe gross electrical output of the generator shall be attributed toeach unit in proportion to the unit’s share of the total controlperiod heat input of all the units for the specified ozone season.The new provisions at LAC 33:III.506(B)(2)(b)(ii) are approvable. Thesesubstantive revisions to the Louisiana Ozone Season NOXallocationmethodology revise the methodology consistent with LDEQ’s intent andstakeholder comments. The CAIR abbreviated SIP requirements give stateslatitude in structuring an allocation methodology that best suits the needs ofthe respective state. The revisions submitted by the LDEQ do not alter any ofthe timing requirements for assigning the allocations or submitting theseallocations to EPA.c.Utility Units. The department shall allocate CAIR NOx ozoneseason allowances to each CAIR utility unit by multiplying theCAIR NOx ozone season budget for Louisiana (40 CFR97.340), minus the allowances allocated under SubparagraphB.2.a of this Section, by the ratio of the ozone season adjustedbaseline heat input of the CAIR utility unit and/or convertedheat input of a certified unit to the total amount of ozone seasonadjusted baseline heat input and converted heat input of allCAIR utility units and certified units in the state and rounding tothe nearest whole allowance. The ozone season adjustedbaseline heat input (in MMBTU) used with respect to the CAIRNOx ozone season allowance for each CAIR utility unit shall beestablished as follows.c.Utility Units. The department shall allocate CAIR NOx ozone seasonallowances to each CAIR utilityunit by multiplying the CAIR NOxozone season budget for Louisiana (40 CFR 97.340), minus theallowances allocated under Subparagraph B.2.a of this Section, by theratio of the ozone season adjustedbaseline heat input of the CAIRutility unit and/or converted heat input of a certified unit to the totalamount of ozone season adjusted baseline heat input and convertedheat input of all CAIR utility units and certified units in the state androunding to the nearest whole allowance. The ozone season adjustedbaseline heat input (in MMBTU) usedwith respect to the CAIR NOxozone season allowance for each CAIR utility unit shall beestablished as follows.The revisions at LAC 33:III.506(B)(2)(c)(ii) are approvable. Thesesubstantive revisions to the Louisiana Ozone Season NOXallocationmethodology revise the methodology consistent with LDEQ’s intent and29SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009stakeholder comments. The CAIR abbreviated SIP requirements give stateslatitude in structuring an allocation methodology that best suits the needs ofthe respective state. The revisions submitted by the LDEQ do not alter any ofthe timing requirements for assigning the allocations or submitting theseallocations to EPA.i.The average of the unit’s control period ozone seasonadjusted heat input for the three calendar years immediatelypreceding the deadline for submission of allocations to theadministrator shall be used (except that the allocationsubmitted in 2007 shall use the average of the controlperiod ozone season adjusted heat input for calendar years2002, 2003, and 2004), with the control period ozoneseason adjusted heat input for each year calculated asfollows.NO CHANGEa)If the unit is coal-fired during a year, the unit’s controlperiod ozone season heat input for that year shall bemultiplied by 100 percent.b)If the unit is oil-fired during a year, the unit’s controlperiod ozone season heat input for that year shall bemultiplied by 60 percent.c)If the unit is not subject to Subclause B.2.c.i.(a) or (b)of this Section, the unit’s control period ozone seasonheat input for the year shall be multiplied by 40percent.a)If the unit is solid fuel-fired coal-fired during a year, theunit’s control period ozone season heat input for that yearshall be multiplied by 100 percent.b)If the unit is liquid fuel-fired oil-fired during a year, theunit’s control period ozone season heat input for that yearshall be multiplied by 60 percent.c)NO CHANGEThe revisions at LAC 33:III.506(B)(2)(c)(i) are approvable. Thesesubstantive revisions to the Louisiana Ozone Season NOXallocationmethodology revise the methodology consistent with LDEQ’s intent andstakeholder comments. The CAIR abbreviated SIP requirements give stateslatitude in structuring an allocation methodology that best suits the needs ofthe respective state. The revisions submitted by the LDEQ do not alter any ofthe timing requirements for assigning the allocations or submitting theseallocations to EPA.ii.A unit’s control period ozone season heat input, status ascoal-fired or oil-fired, and total tons of NOx ozone seasonemissions during a calendar year shall be determined inaccordance with 40 CFR Part 97and reported in accordancewith LAC 33:III.919.ii.A unit’s control period ozone season heat input, fuel type,status as coal-fired or oil-fired, and total tons of NOx ozoneseason emissions during a calendar year shall be determined inaccordance with 40 CFR Part 97and reported in accordancewith LAC 33:III.919.30SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009The revisions at LAC 33:III.506(B)(2)(c)(ii) are approvable. Thesesubstantive revisions to the Louisiana Ozone Season NOXallocationmethodology revise the methodology consistent with LDEQ’s intent andstakeholder comments. The CAIR abbreviated SIP requirements give stateslatitude in structuring an allocation methodology that best suits the needs ofthe respective state. The revisions submitted by the LDEQ do not alter any ofthe timing requirements for assigning the allocations or submitting theseallocations to EPA.3.Timing Requirements for CAIRNOx Ozone Season AllowanceAllocationsNO CHANGEa.By April 30, 2007, the department shall submit to theadministrator the CAIR NOx ozone season allowanceallocations, in a format prescribed by the administrator and inaccordance with Paragraph B.2 ofthis Section, for the controlperiods in 2009, 2010, and 2011.NO CHANGEb.By October 31, 2008, for the year 2012, and by October 31 ofeach year thereafter, the department shall submit to theadministrator the CAIR NOx ozone season allowanceallocations, in a format prescribed by the administrator and inaccordance with Paragraph B.2 ofthis Section, for the controlperiod in the fourth year after the year of the applicable deadlinefor submission under this Section.NO CHANGESection 506(C). Clean Air Interstate Rule Requirements—Annual Sulfur Dioxide.(C).Annual Sulfur Dioxide. Except as specified in this Section, the FederalSO2 Model Rule, published in theCode of Federal Regulationsat 40CFR Part 96, July 1, 2005, and as revised at 70 FR 25162-25405, May12, 2005, and 71 FR 25328-25469, April 28, 2006, is herebyincorporated by reference, except for Subpart III –- CAIR SO2 Opt-inUnits and all references to opt-in units.(C).Annual Sulfur Dioxide. Except as specified in this Section, the FederalSO2Model Rule, published in theCode of Federal Regulationsat 40CFR Part 96, July 1, 2007 2005, and as revised at72 FR 59190-59207,October 19, 2007 70 FR 25162-25405, May 12, 2005, and 71 FR 25328-25469, April 28, 2006, is hereby incorporated by reference, except forSubpart III –- CAIR SO2 Opt-in Units and all references to opt-in units.The substantive revisions to LAC 33:III.506(C) are approvable. Theserevisions update the incorporation by reference of the federal CAIR SO2program to be consistent with current federal requirements.Section 506(D). Documentation.31SIP-approved by EPA on 7/20/2007 and 9/28/2007As adopted by LDEQ on 9/20/2006 and amended 8/20/2007Revisions adopted June 20, 2008Submitted to EPA on July 1, 2009(D).Copies of documents incorporated byreference in this Section may beobtained from the Superintendent of Documents, U.S. GovernmentPrinting Office, Washington, D.C. 20242 or their website,www.gpoaccess.gov/cfr/index.html; from the Department ofEnvironmental Quality, Office of Environmental Services, Air PermitsDivision; or from a public library.NO CHANGESection 506(E). Modifications or Exceptions.(E).Modifications or Exceptions. A copy of each report or notice or of anyother documentation required by the referenced regulations (i.e., 40 CFRPart 96) to be provided to “the Administrator” shall be provided to theOffice of Environmental Services, Air Permits Division, by the personrequired to make the submission to “the Administrator.”NO CHANGE

# 32 C. Evaluation of the July 1, 2009, Louisian a SIP revision with respect to section

110(l) of the Clean Air Act?

Section 110(l) of the Clean Air Act states:

Each revision to an implementation plan s ubmitted by a State under this Act shall

be adopted by such State after re asonable notice and public hearing. The

Administrator shall not approve a revi sion of a plan if the revision would

interfere with any applicable requirem ent concerning attainment and reasonable

further progress (as defined in section 171 ), or any other applicable requirement

of this Act.

EPA approved the Louisiana CAIR SO 2 

# and NO X 

# trading programs in separate actions on

July 20, 2007, and September 28, 2007. The July 1, 2009, revisions to the Louisiana SIP

amend the existing SIP-approved CAIR programs. EPA developed the CAIR in an effort

to reduce the transport of SO 2 

# and NO X 

# emissions that contri bute significantly to

nonattainment of the 8-hour ozone and PM 2.5 

# NAAQS. During the development process,

EPA demonstrated through mode ling the projected ozone and PM 2.5 

# nonattainment areas

in 2010, 2015, and 2020, that CAIR w ill not interfere with attain ment of the standards;

rather this modeling demonstrated that CAIR in concert with other federally approved

control measures will actually br ing existing areas of ozone and PM 2.5 

# nonattainment into

attainment with the ozone and PM 2.5 

# NAAQS. 2 

# Additionally, source s subject to CAIR

are still bound by their permit conditions under New Source Review and Title V. These

sources can participate in the cap-and-trade aspects of the CAIR but cannot exceed their

permit limits for NO X 

# . The Louisiana New Source Review and Title V permitting

programs are designed such that the issuance of a permit will not interfere with existing

SIP requirements or with the attainment of a NAAQS. As long as the adopted rules are

consistent with the SIP development requi rements at 40 CFR Part 51 and the specific

CAIR program requirements, then EPA finds that the program will not interfere with

attainment or reasonable furthe r progress or any other applicable requirement of the Act.

2 

## Please see EPA’s analysis titled “Contributions of CAIR/CAMR/CAVR to NAAQS Attainment: Focus on

Control Technologies and Emission Reductions in the Power Sector” prepared by the Office of Air and

Radiation on April 18, 2006.

# 33 V. Conclusion

The technical analysis provided in the precedi ng sections has evaluated the revisions to

the Louisiana CAIR NO X 

# Annual, NO X 

# Ozone Season, and SO 2 

# programs adopted on

June 20, 2008, and submitted as a revision to the Louisiana SIP on July 1, 2009. EPA’s

evaluation demonstrates that the LDEQ has appropriately re vised the allocation

methodologies for the NO X 

# Annual and Ozone Season programs and appropriately

updated the incorporation by reference date of the SO 2 

# program. It is recommended that

EPA propose approval of the July 1, 2009 SIP revision. Because these are

noncontroversial revisions, EPA should cons ider a direct fina l approval.