### Bryan W. Shaw, Ph.D., 

### Chairman Buddy Garcia, 

### Commissioner Carlos Rubinstein, 

### Commissioner Mark R. Vickery, P.G., 

### Executive Director 

# RECEIVED- 6PBl,. 

# AIR 

# PLANNING S€C. 12 APR30 PH 5: 23
TEXAS COMMISSION ON ENVIRONMENTAL QUALITY Protecting Texas by Reducing andPreventing Pollution 

## April 13,2012

Alfredo Armendariz, Ph.D. Regional Administrator U.S. Environmental Protection Agency- Region 6 1445 

## Ross Avenue Dallas, Texas 75202-2733 

## Dear Dr. Armendariz: Docket No. 2011-0845-RUL Rule ProjectNo 2011-018-101-EN



## On March 28, 2012, 

## the Texas Commission on Environmental Quality (Commission) adopted revisions to the State Implementation Plan (SIP). The Commission adoptedamendments to §§117.1020, 117.1120, 117.1220, 117.3020, 

## and 117.98oo 

## in 30

## TAC Chapter 117, 

## Control ofAir Pollution from Nitrogen Compounds; and corresponding revisions to the SIP. The SIP revision removes all references to the System Cap Trading rules (which were repealedfrom 30

## TAC Chapter 101, 

## General Air Quality Rules, inthe same action) from Chapter 117. 

## The proposed rules were publishedinthe October 21, 2011, 

## issue ofthe 

# Texas Register (36 

## TexReg 7138) 

## Enclosed are the proposedrevisions tothe SIP, a publichearing certification, a complete record ofthe public hearings, andthe accompanying order. I look forward to your expeditious approval ofthese SIP revisions. Sincerely, 

# I

# ~.-..'-·~vA~ra.w- BryanW. Shaw, Ph.D. Chairman BWS/ab Enclosures

cc: The Honorable Rick Perry, Governor ofTexas Mr. Toby Baker, Office ofBudget, Planning andPolicy, Office ofthe Governor Mr. Mark R. Vickery, P.G., Executive Director, Texas Commission on Environmental Quality

P.O. Box 13087 • Austin, Texas 78711-3087 • 512-239-1000 • www.tceq.texas.gov How is our customer service? www.tceq.texas.gov/gotojcustornersurvey

# TEXAS COMMISSION ON ENVIRONMENTAL QUALITY

Docket No. 

## 2011-0845-RUL

THE STATE OF TEXAS COUNTY OF TRAVIS

This is to certifythatthe attached electronic file is included andthat the electronicfile is a
true and correct copy ofdocuments for a revision totheTexas State ImplementationPlan, adopted onMarch 28, 2012, 

## pursuantto 4-o Code ofFederal Regulations § 51.104. 

## I amthe records administrator for theAir Quality Division oftheTexas Commission on Environmental Quality (Commission).

# ~~.~ U

- Air Quality Division

Texas Commission on Environmental Quality

### Texas Commission on Environmental Quality Public Hearings November 15 and 17, 2011 Concerning Revisions to 30 TAC Chapters 101 and 117 Repeal of Chapter 101 System Cap Trading Program Rules and Revisions to Chapter 117 Project No. 2011-018-101-EN

### INTRODUCTION

The Texas Commission on Environmental Quality (commission) held public hearings in Houston on November 15, 2011 and in Austin on November 17, 2011, to receive testimony regarding revisions
to 30 TAC Chapters 101 and 117 and corresponding revisions to the state implementation plan.

The rulemaking repeals all rules pertaining to the System Cap Trading program specified in Chapter 101, Subchapter H, Division 5, §§101.380, 101.382, 101.383, and 101.385. In addition, §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800, relating to System Cap rules, are amended to remove references to the Chapter 101 System Cap Trading program.

The comment period closed on November 21, 2011. All testimony and comments have been reviewed and seriously considered. This hearing record contains a complete record ofthe public hearings and is divided into the following four sections:

o Public Notification and Proposal

o Written and Oral Testimony

o Evaluation of Testimony

o Staff Recommendations/Order

Additional copies ofthis hearing record are maintained in the TCEQ central office at 12100 Park 35 Circle, Austin, Texas 78753. Forfurther information, please contact Shantha Daniel, Ph.D. at(512) 239-3930.

# NOTICE 

# & PROPOSAL

### PUBLIC NOTIFICATION

Notification to the public ofthe proposed revisions was conducted by the following procedures:

1. Publication of notice of public hearings in the following newspapers on the date listed: Austin American-Statesman: 

### October 7, 2011 Beaument Enterprise: 

### October 7, 2011 Fort Worth Star- Telegram: 

### October 7, 2011 Houston Chronicle: Longview News-Journal: 

### October 7, 2011 October 7, 2011

2. Publication ofthe proposed rules in the October 21, 2011, issue of the Texas Register

### (36 TexReg 7138).

3. Publication of the Notice of Public Hearings in the October 21, 2011, issue ofthe Texas Register 

### (36 TexReg 7196).

4. Correspondence forwarding the notice of public hearings to the following officials and agencies: Speaker of the House Lieutenant Governor Alamo Area Council of Governments Capital Area Planning Council City ofAustin, Mayor's Office City of Dallas, Department of Environmental Quality City of Dallas, Department of Aviation City of El Paso, Environmental Services City of Fort Worth, Environmental Management Department

### City of Houston, Department of Health and Human Services City of Houston, Mayor's Office East Texas Council of Governments
El Paso Metropolitan Planning Organization Federal Highway Administration Galveston County Health District Harris County Judge Harris County Public Health and Environmental Services North Central Texas Council of Governments Houston-Galveston Area Council South East Texas Regional Planning Commission Texas Department of Transportation Travis County Judge Victoria Metropolitan Planning Organization Arkansas Department of Pollution Control and Ecology Louisiana Department of Environmental Quality New Mexico Environmental Department Oklahoma Department of Environmental Quality United States Environmental Protection Agency

### Example of Newspaper Classified Ad
Austin American-Statesman, 

### October 7, 2011

NOTICE OF PUBLIC HEARINGS BY THE TEXAS COMMISSION ON ENVIRONMENTAL QUALITY ON PROPOSED REVISIONS TO 30 TAC CHAPTERS 101 AND 117 AND TO THE STATE IMPLEMENTATION PU\N The**Te~as** Commission on Environmental**Quail~/** (commission) 'hill conduct public hearing& to receive testimony regarding proposed revisions to 30 TAC Chapler 101, General Air Quality Rules and Chapter 117, Control ofAir Pollufion From Nitrogen Compounds, and corresponding revlsfons to the state Implementation plan (SIP) under the requirements ofTexas Health and Safety Code, 382.017; Texas Government Code, Chapter 2001, Subchapter B; and 40 Code ofFederal Regulations 51.102, and the United States Environmental Protectfon Agency (EPA) concerning**SJ.~s.** The proposed rulemaking would repeal all rules pertafning to the System Cap Tradillg program speclfled In Chapter 10·1, Subchapter H, Divi-sion 5, 101.380, 101.382, 101.383, and 101.385. In addition, 117.1020, 117.1120, 117.1220, 117.3020, and 117.9800, relating to System Cap rules, would be amended to remove references to the Chapter 101 System Cap Trading program. Public hearings on this proposal w111 be held at the following tlmes and lccatlcns: L, Hous:on on November 15, 20f1, at 1:30 p.m. and 6:00 p.m.ln Conference Room C at the Hcustor.-Galveston !'.rea Council located at 3555 Timmons Lana: and In Ausfln on November 17, 2011, at 2:00p.m. at the Texas Commission on Environmental Quality, Bull<fmg E, Room 2C1S, at the commission's central office located at 12100 Park 35 Circle. The hearlngs wi!f be structured for the receipt of oral or written comments by Interested persons. Registration will begin 30 minutes prior to each hearing. lndMduals may presenl oral statements when called upon In order of registration. There will be no cpen dlscusarcn during the hearings; however, commission staff member3 wm be available to**~cuss** the proposals 30 minutes before the hearlngs. Persons planning to attend the hearings who have special commwnication or other accommodation needs should contact Sandy Wong, Office of Legal Services at (512) 239-1802. Requests should be made as far In advance as possible. Comments may be submitted to CharloUe Horn, Texas Register Team, Office crf Legaf Ser"lces, Texas Commission on Environmental Quality, MC 2.05, P.O.**Bo~** 13087, Austin, Texas 78711-3087, orfaxed to (512} 239-4808. Electronic comments may be submitted at http:J/'www5.1ceq.texas.govlruleslecomments/. File size restric.tiona may apply to comments belnQ submitted**~ia** tr.e eComments system. All comments should reference Rule ProJect Number 2011- 018-101-EN. The commer;tperlod closes November 21,2011. Copies of !he**prcpo~ed** rules can he obtained from the commission's Web site at htlp:/lwww.tceq.texas.gov/nav/mles/propose_<ldopt.html. f'or further Information, please contact Shantha Daniel, !'.ir Quality Planning .section, (512) 239-3930.final decision or order. A person is J: esumed to have been notified on the third day after the date that the d cision or order is mailed by first class mail. Ifthe motion is denied u der**~80.272** and**~80.273** ofthis title (relatina to Motion for Rehearin

. and Decision Final and Appealable respectively) the commission' decision is final and appealable under Texas Health and Safety Code §382.032, or under the Texas Administrative Procedure Act. 

## ilil Ifall hearina req estors whose requests for a contested case hearincr were granted wit regard to an issue, withdraw in writina their hearing requests with r aard to the issue before issuance ofthe notice ofthe contested case he rina, the scope ofthe hearina no longer includes that issue except as a thorized under Texas Health and Safe!}:: Code, §382.059. 

## ill Procedural schedules @ Upon convening**~** hearing pursuant to the procedural rules in Chapter 80 ofthis title ndofSOAH 1TAC Chapter 155 (relatingto Rules ofProcedure), the

### Administrative LawJudae shallestablish a procedural schedule which shall provide for, as appropriate discovery, hearina date and pre- and post-hearing briefinas to comply withthe provisions ofTexas Health aJ d Safety Code**~382.059** andthis section. .@} The Administrati e Law Judge shall issue a proposal for decision within 80 days afte the executive director issues the draft permit, or as specified by the ommission, to meet the requirements ofTexas Health and Safety Cc de, §382.059 and this section. 

## ill Pleadinas Following Pro osal for Decision. The pleading requirements of**~80.257** ofthis title relating to Pleadinas Following Proposal for Decision) shall not app y to applications filed under this section. 

## ill Pleading schedule. Tnless riaht of review has been waived, any party may file exceptio s within five business days after the date ofissuance ofthe proposal 

# r. r decision. Any replies to exceptions shall be filed within eight busin ss days after the date ofissuance ofthe QrOQosal for decision. 

## ill Chanae offiling dea lines. On his own motion or at the request ofa party, the aeneral co nsel may chanoe the deadlines to file pleadinas following the proposal or decision. A party requesting a change must file a written request w· h the chiefclerk, and must serve a copy on the general counsel. the iu ge, and the other parties. The request must explain that the party req fiesting the chanoe has contacted the other parties and whether the req est is opposed by any party. The request must include proposed date and must indicate whether the judge and the parties agree on the prbposed dates. 

## .ill Notice ofDecision. No I erthan 120 days from the date of issuance ofa draftpermitthe commis ion shall make afinal decision on a permit amendment application unc er this section. The commission shall send notice ofa decision on ar application for a permit amendmentby first-class mailto the applica t and allpersons who commented during the public comment period or at the public meetina. The notice shall include a response to any co!lll aent submitted during the public comment period and shall identifY ar y change in the conditions ofthe draft permit and the reasons for the hange. The notice shall include the following text: 

## ill state that any person affected by the decision of the commission may appeal the decision; 

## ill state the date by whi**~the** appeal must be filed· and 

## ill explain the appeal pr cess.



## 36 TexReg 7138 October 21, 2011 Texas Register .(gl A person affected by a decision ofthe commission to issue or deny a permit amendment m y file a motion for rehearina under §80.272 ofthis title. Ifthe motion is denied under §80.272 and §80.273 ofthis title the commission's deci ion is final and appealable under Texas Health and Safety Code. §38 .032 or under the Texas Administrative Procedure Act. 

## ill Expiration. This sectio expires onthe sixth anniversary of the date the EPA administrator ado ts standards for existing_EGFs underthe Federal Clean AirAct. §I 12 unless a stay ofthe rule is oranted. This agencyherebycertifies that he proposal has been reviewed by legal counsel and found to be Nithin the agency's legal authority to adopt. Filed with the Office ofthe Secre ary ofStateon October7, 2011. TRD-2011 04230 Robert Martinez Director, Environmental Law Divisic f1 Texas Commission on Environmen al Quality Earliest possible date ofadoption: ovember 20, 2011 Forfurther information, please call: (512) 239-2548 

# • • CHAPTER 117. CONTROL OF AIR POLLUTION FROM NITROGEN COMPOUNDS SUBCHAPTER C. COMBUSTION CONTROL AT MAJOR UTILITY ELECTRIC GENERATION SOURCES IN OZONE NONATTAINMENT AREAS The Texas Commission on Environmental Quality (commission) proposes amendments to §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800. If adopted, the amended sections will be submitted to the United States Environmental Protection Agency (EPA) as revisions to the state implementation plan (SIP). Background and Summaryofthe Factual Basisfor the Proposed Rules On March 21, 2001, the commission adopted rules that provided owners or operators of electric generating facilities (EGF) located in the Dallas-Fort Worth one-hour ozone nonattainment area (consisting of Collin, Dallas, Denton, and Tarrant Counties) or the East and Central Texas counties, as listed in §117.3000(a)(4), and subject to the system cap emission limits specified in Chapter 117 additional compliance flexibility in meeting their system caps through participation in the System Cap Trading (SCT) program. The SCTprogram was established through rules adopted by the commission on March 21, 2001, specifying the requirements for the SCT program in 30 TAC Chapter 101, Subchapter H, Emissions Banking and Trading. The system cap emission limits in Chapter 117 set daily, 30-day rolling average, or annual emission caps on total nitrogen oxides (NO.) emissions from EGFs that are: subject to the Chapter 117 emission specifications for attainment demonstration (ESAD); undercommon ownership or control; and grouped together in an electricpowergenerating system, as defined in §117.10(14). For example, if company A has three sites, X, Y, and Z with 3, 4, and 5 EGFs, respectively, that are subjectto the Chapter 117 ESADs and are part ofan electric powergenerating system, Chapter 117sets a daily, 30-day rolling average, or annual emission caps on the total emissions from the 12 affected EGFs. On May 23, 2007, the commission adopted reformatted and renumbered Chapter 117 rules. The adopted rules also provided new emission specifications for the Dallas-Fort Worth 1997 eight-hour ozone nonattainment area (DFW area), consisting of Collin, Dallas, Denton, Ellis, Johnson, Kaufman, Parker, Rockwall, and Tarrant Counties, necessary to demonstrate the attainment of the 1997 eight-hour ozone National Ambient Air Quality Standards (NAAQS). Under the adopted rules, EGFs in the Collin, Dallas, Denton, or Tarrant Counties that are subject to the new emissions specifications are no longer required to meet the emission specifications specified in Chapter 117, Subchapter B, Division 2, Subchapter C, Division 2, after March 1, 2009. For EGFs in the DFW area, the Chapter 117 rules do not allow participation in a system cap as an alternative means of compliance with the new emissions specifications, and hence EGFs in the DFW area no longer have the option of participating in the SCT program. Certain compliance flexibility options {the SCT program, the Emission Credit Banking and Trading program, and the Discrete Emission Credit Banking and Trading program) were provided by the adopted rules to owners or operators of EGFs with system cap emission limits specified in Chapter 117 and located in the Beaumont-Port Arthur 1997 ozone maintenance area (BPA area), consisting of Hardin, Jefferson, and Orange Counties; the Houston-Galveston-Brazoria 1997 eight-hour ozone nonattainment area (HGB area), consisting of Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties; and counties in East and Central Texas as listed in §117.3000(a)(4). The East and Central Texas counties are Atascosa, Bastrop, Bexar, Brazos, Calhoun, Cherokee, Fannin, Fayette, Freestone, Goliad, Gregg, Grimes, Harrison, Henderson, Hood, Hunt, Lamar, Limestone, Marion, Mclennan, Milam, Morris, Nueces, Parker, Red River, Robertson, Rusk, Titus, Travis, Victoria, and Wharton. The adopted rules also made clear that EGFs in the HGB area are required to meet the system cap emission limits specified in §117.320 or §117.1220, in addition to complying with the emission specifications in §117.310 or §117.1210 through participation in the Mass Emissions Cap and Trade program. The SCT program rules in §1 01.383 and §1 01.385 were amended on July 25, 2007, to accurately reference the newly renumbered sections in Chapter 117 related to system cap emission limits. The SCT program has seen minimal participation from affected sources, and on February 23, 2011, the commission approved the withdrawal of the Chapter 101 SCT program rules from consideration by the EPA as a revision to the SIP. The EPA was notified ofthis withdrawal in a letter dated March 4, 2011. While the repeal ofthe Chapter 101 SCT program rules and corresponding revisions to Chapter 117 are not specifically required by federal regulation, the Chapter 117 rules for system cap requirements are included in the SIP (73 FR 73562) and allow the SCT program as a regulatory option for compliance. Removing the references to the SCT program in Chapter 117 will avoid confusion among regulated entities that are subject to the Chapter 117 system cap emission limits and will address any potential concerns regarding the use of a compliance option that is not federally enforceable to meet a federally enforceable rule. The amendments to §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800 are proposed concurrently with the repeal of sections pertaining to the SCT program from Chapter 101. The repeal of sections pertaining to the SCT program from Chapter 101 is published in a separate rulemaking in this issue of the Texas Register. Section by Section Discussion The proposed rulemaking would amend the majorsource rules in Chapter 117, Subchapter C, Divisions 1 - 3; Subchapter E, Division 1; and Subchapter H, Division 2. These proposed changes would amend §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800 by removing references to Chapter 101 SCT program rules. The proposed rulemaking would also include various nonsubstantive revisions to these sections to conform to current Texas Registerstyle and format requirements. §§117.1020, 117.1120, 117.1220, 117.3020, System Cap The commission proposes to amend §§117.1 020(1), 117.1120(1), 117.1220(1), and 117.3020(1) by removing references to Chapter 101, Subchapter H, Division 5, SCT program. The existing language in subsection {I) provides owners or operators of EGFs subject to the Chapter 117 system cap emission limits the flexibility to exceed their system cap provided that the owneroroperator is complying with the requirements of§117.9800 or Chapter 101, Subchapter H, Division 1, 4, or 5. The proposed amendments would remove references to Chapter 101, Subchapter 

### H, Division 5, SCT program requirements. §117.9800, Use ofEmission Credits for Compliance The commission proposes to amend §117.9800(b) by removing references to the SCT program requirements in Chapter 101, Subchapter H, Division 5. The existing language in subsection (b) allows an owner or operator of a unit subject to §§117.320, 117.1020, 117.1120, 117.1220, or 117.3020 to meet the emission control requirements of these system caps by complying with the requirements of Chapter 101, Subchapter H, Division 5, SCT program or by obtaining Emission Reduction Credits, Mobile Emission Reduction Credits, Discrete Emission Reduction Credits, or Mobile Discrete Emission Reduction Credits in accordance with Chapter 101, Subchapter 

### H, Divisions 1 and 4. The proposed amendments would remove references to Chapter 101, Subchapter 

### H, Division 5, SCT program requirements. Fiscal Note: Costs to State and Local Government Nina Chamness, Analyst, Strategic Planning and Assessment, has determined that for the first five-year period the proposed rules are in effect, no significant fiscal implications are anticipated for the agency. Units ofstate or local government that own or operate EGFs are not expected to experience fiscal impacts as a result of the rules. The proposed rules are administrative in nature and eliminate references to the Chapter 101 SCT program rules from Chapter 117. The proposed rules would amend Chapter 117 to remove references to the SCT program and are part of a rule package that repeals the SCT program specified in Chapter 101 for EGFs located in the 31 counties of East and Central Texas, counties in the BPA area, and counties in the HGB area. The fiscal impacts ofthe repeals are addressed in a separate rulemaking addressed in this issue ofthe Texas Register. The proposed rules are administrative in nature and will not have a fiscal impact on any units of state or local government. Public Benefits and Costs



## PROPOSED RULES October 21, 2011 36 TexReg 7139Nina Chamness also determined that for each year of the first five years the proposed rules are in effect, the public benefit anticipated from the changes in the proposed rules are increased rule clarity and efficiency regarding compliance options for EGFs. The proposed rules will not have a fiscal impact on individuals because they are administrative in nature and because EGFs are typically owned or operated by large businesses. The proposed rules will not have a fiscal impact on large businesses in the BPA area, the HGB area, and the 31 counties of East and Central Texas. The proposed rules are administrative in nature and merely remove references in Chapter 117 to the Chapter 101 SCT program rules, which are being repealed. Small Business and Micro-Business Assessment No adverse fiscal implications are anticipated for small or microbusinesses as a result ofthe proposed rules. The proposed rules are administrative in nature and have no fiscal impact. Small Business Regulatory Flexibility Analysis The commission has reviewed this proposed rulemaking and determined that a small business regulatory flexibility analysis is not required because the proposed rules do not adversely affect a small or micro-business in a material way for the first five years that the proposed rules are in effect. Local Employment Impact Statement The commission has reviewed this proposed rulemaking and determined that a local employment impact statement is not required because the proposed rules do not adversely affect a local economy in a material way for the first five years that the proposed rules are in effect. Draft Regulatory Impact Analysis Determination The commission reviewed the proposed rulemaking in light of the regulatory impact analysis requirements of the Texas Government Code, §2001.0225, and determined that the proposed rulemaking does not meetthe definition of a "major environmental rule" as defined in that statute. A "major environmental rule" means a rule, the specific intent of which is to protect the environment or reduce risks to human health from environmental exposure, and that may adversely affect in a material waythe economy, a sector ofthe economy, productivity, competition, jobs, the environment, or the public health and safety ofthe stateor a sectorofthe state. The purpose ofthe proposed rulemaking is to remove the references to the Chapter 101 SCT rules from Chapter 117. The SCT rules in Chapter 101 are being proposed for repeal in a concurrent rulemaking, and are not a part of the Texas SIP. Therefore, the proposed rulemaking will remove the option to use the SCT program from Chapter 117 to avoid any potential concerns that a compliance option that is not federally enforceable might be used to meet a federally enforceable rule. Additionally, the proposed rulemaking does not meet any of the four applicability criteria for requiring a regulatory impact analysis for a major environmental rule, which are listed in Texas Government Code, §2001.0225(a). Texas Government Code, §2001.0225, applies only to a major environmental rule, the result of which is to: 1) exceed a standard set by federal law, unless the rule is specifically required by state law; 2) exceed an express requirement of state law, unless the rule is specifically required by federal law; 3) exceed a requirement of a delega

## 36 TexReg 7140 October 21,2011 Texas Register tion agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or 4) adopt a rule solely under the general powers of the agency instead of under a specific state law. The requirement to provide a fiscal analysis of proposed regulations in the Texas Government Code was amended by Senate Bill (SB) 633 during the 75th Legislature, 1997. The intent of SB 633 was to require agencies to conduct a regulatory impact analysis of extraordinary rules. These are identified in the statutory language as major environmental rules that will have a material adverse impact and will exceed a requirement of state law, federal law, or a delegated federal program, or are adopted solely under the general powers ofthe agency. With the understanding that this requirement would seldom apply, the commission provided a cost estimate for SB 633 concluding that "based on an assessment of rules adopted by the agency in the past, it is not anticipated that the bill will have significant fiscal implications for the agency due to its limited application." The commission also noted that the number of rules that would require assessment under the provisions of the bill was not large. This conclusion was based, in part, on the criteria set forth in the bill that exempted proposed rules from the full analysis unless the rule was a major environmental rule that exceeds a federal law. The Federal Clean Air Act (FCAA) does not always require specific programs, methods, or reductions in order to meet the NAAQS; thus, states must develop programs for each area contributing to nonattainment to help ensure that those areas will meet the attainment deadlines. Because of the ongoing need to address nonattainment issues, and to meet the requirements of 42 United States Code (USC), §7410, the commission routinely proposes and adopts SIP rules. The legislature is presumed to understand this federal scheme. If each rule proposed for inclusion in the SIP was considered to be a major environmental rule that exceeds federal law, then every SIP rule would require the full regulatory impact analysis contemplated by SB 633. This conclusion is inconsistent with the conclusions reached by the commission in its cost estimate and by the Legislative Budget Board (LBB) in its fiscal notes. Since the legislature is presumed to understand the fiscal impacts of the bills it passes, and that presumption is based on information provided by state agencies and the LBB, the commission believes that the intent of SB 633 was only to require the full regulatory impact analysis for rules that are extraordinary in nature. While the SIP rules will have a broad impact, the impact is no greater than is necessary or appropriate to meet the requirements ofthe FCAA. Forthese reasons, rules adopted for inclusion in the SIP fall under the exception in Texas Government Code, §2001.0225(a), because they are required by and do not exceed, federal law, including the approved SIP. In addition, these rules do not exceed any contract between the state and a federal agency. The commission has consistently applied this construction to its rules since this statute was enacted in 1997. Since that time, the legislature has revised the Texas Government Code but left this provision substantially unamended. It is presumed that "when an agency interpretation is in effect at the time the legislature amends the laws without making substantial change in the statute, the legislature is deemed to have accepted the agency's interpretation." Central Power & Light Co. v. Sharp, 919 S.W.2d 485, 489 (Tex. App. Austin 1995), writ denied with per curiam opinion respecting another issue, 960 S.W.2d 617 (Tex. 1997); Bullock v. Marathon Oil Co., 798 S.W.2d 353, 357 (Tex. App. Austin 1990, no writ). Cf. Humble Oil 

### & Refining Co. v. Calvert, 414 S.W.2d 172 (Tex. 1967); Dudney v. StateFarm Mut. Auto Ins. Co., 9 S.W.3d 884, 893 (Tex. App. Austin 2000); Southwestern Life Ins. Co. v. Montemayor, 24 S.W.3d 581 (Tex. App. Austin 2000, pet. denied); and Coastal lndust. Water Auth. v. Trinity Portland Cement Div., 563 S.W.2d 916 (Tex. 1978). The commission's interpretation of the regulatory impact analysis requirements is also supported by a change made to the Texas Administrative Procedure Act (APA) by the legislature in 1999. In an attempt to limit the number of rule challenges based upon APA requirements, the legislature clarified that state agencies are required to meet these sections ofthe APA against the standard of "substantial compliance." The legislature specifically identified Texas Government Code, §2001.0225, as falling under this standard. The commission has substantially complied with the requirements ofTexas Government Code, §2001.0225. As defined in the Texas Government Code, §2001.0225 only applies to a major environmental rule, the result of which is to: exceed a standard set by federal law, unless the rule is specifically required by state law; exceed an express requirement of state law, unless the rule is specifically required by federal law; exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or adopt a rule solely under the general powers ofthe agency instead of under a specific state law. This rulemaking action does not meet any of these four applicability requirements of a "major environmental rule." The proposed rulemaking will remove an obsolete compliance option from Chapter 117, and therefore avoid any potential concerns that a compliance option that is not federally enforceable might be used to meet a federally enforceable rule. This rulemaking action does not exceed an express requirement ofstate lawor a requirement ofa delegation agreement, and was not developed solely underthe general powers ofthe agency, but is authorized under Texas Health and Safety Code, §§382.011, 382.012, and 382.017, as well as under 42 USC, §§7401, 

### et seq., which requires states to submit SIP revisions that specify the manner in which the NAAQS will be achieved and maintained within each air quality control region ofthe state. Written comments on the draft regulatory impact analysis determination may be submitted to the contact person at the address listed underthe Submittal ofComments section ofthis preamble. Takings Impact Assessment Under Texas Government Code, §2007.002(5), taking means a governmental action that affects private real property, in whole or in part or temporarily or permanently, in a manner that requires the governmental entity to compensate the private real property owner as provided by the Fifth and Fourteenth Amendments to the United States Constitution or§17 or§19, Article I, Texas Constitution; ora governmental action that affects an owner's private real property that is the subject of the governmental action, in whole or in part ortemporarily or permanently, in a manner that restricts or limits the owner's right to the property that would otherwise exist in the absence of the governmental action; and is the producing cause of a reduction of at least 25% in the market value of the affected private real property, determined by comparing the market value of the property as if the governmental action is not in effect and the market value ofthe property determined as if the governmental action is in effect. The commission completed a takings impact analysis forthe proposed repeal under Texas Government Code, §2007.043. The proposed rules will remove the references to the Chapter 101 SCT program rules from Chapter 117. The SCT rules in Chapter 101 are being proposed for repeal in a concurrent rulemaking, and are not a part of the Texas SIP. Therefore, the proposed rulemaking would remove the option to use the SCT program from Chapter 117 to avoid any potential concerns that a compliance option that is not federally enforceable might be used to meet a federally enforceable rule. The proposed amendments will not create any additional burden on private real property. The proposed amendments will not affect private real property in a manner that would require compensation to private real property owners under the United States Constitution or the Texas Constitution. The proposal also will not affect private real property in a manner that restricts or limits an owner's right to the property that would otherwise exist in the absence of the governmental action. Therefore, the proposed amendments will not cause a taking under Texas Government Code, Chapter 2007. Consistency with the Coastal Management Program The commission reviewed the proposed rulemaking and found that the proposal is subject to the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination Act, Texas Natural Resources Code, §§33.201 

### et seq., and therefore must be consistent with all applicable CMP goals and policies. The commission conducted a consistency determination for the proposed rules in accordance with Coastal Coordination Act Implementation Rules, 31 TAC §505.22 and found the proposed rulemaking is consistent with the applicable CMP goals and policies. The CMP goal applicable to the proposed rulemaking is the goal to protect, preserve, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (CNRA) (31 TAC §501.12(1)). The CMP policy applicable to the proposed rulemaking is the policy that commission rules comply with federal regulations in 40 Code of Federal Regulations, to protect and enhance air quality in the coastal areas so as to protect CNRAs and promote the public health, safety, and welfare (31 TAC §501.32). The proposed rulemaking would not increase emissions of air pollutants and is therefore consistent with the CMP goal in 31 TAC §501.12(1) and the CMP policy in 31 TAC §501.32. Promulgation and enforcement of these rules will not violate or exceed any standards identified in the applicable CMP goals and policies because the proposed rules are consistent with these CMP goals and policies and because these rules do not create or have a direct or significant adverse effect on any coastal natural resource areas. Therefore, in accordance with 31 TAC §505.22(e), the commission affirms that this rulemaking action is consistent with CMP goals and policies. Written comments on the consistency ofthis rulemaking may be submitted to the contact person at the address listed under the Submittal of Comments section ofthis preamble. Effect on Sites Subject to the Federal Operating Permits Program Chapter 117 is an applicable requirement under 30 TAC Chapter 122, Federal Operating Permits Program. If the amendments to Chapter 117 are adopted, owners or operators with facilities subject to the federal operating permit program must revise their operating permit to include the new Chapter 117 requirements. The owners or operators ofthese facilities would have the option of initiating a permit action or waiting for the next permit action, such as a renewal, to include these requirements.



## PROPOSED RULES October 21, 2011 36 TexReg 7141

### Announcement of Hearings The commission will hold public hearings on this proposal in Houston on November 15, 2011, at 1:30 p.m. and 6:00 p.m. in Conference Room C at the Houston-Galveston Area Council located at 3555 Timmons Lane; and in Austin on November 17, 2011, at 2:00 p.m. in Building E, Room 201 S, at the commission's central office located at 12100 Park 35 Circle. The hearings are structured for the receipt of oral or written comments by interested persons. Individuals may present oral statements when called upon in order of registration. Open discussion will not be permitted during the hearing; however, commission staff members will be available to discuss the proposal 30 minutes prior to each hearing. Persons who have special communication or other accommodation needs who are planning to attend the hearings should contact Sandy Wong, Office of Legal Services, at (512) 239-1802. Requests should be made as far in advance as possible. Submittal of Comments Written comments may be submitted to Charlotte Horn, MC 205, Office of Legal Services, Texas Commission on Environmental Quality, P.O. Box 13087, Austin, Texas 78711-3087, or faxed to (512) 239-4808. Electronic comments may be submitted at: http:llwww5.tceq.texas.gov/ruleslecommentsl. 

### File size restrictions may apply to comments being submitted via the eComments system. All comments should reference Rule Project Number 2011-018-101-EN. The comment period closes November 21, 2011. Copies of the proposed rulemaking can be obtained from the commission's Web site at http:llwww.tceq.texas.gov/navlru/eslpropose_adopt.html. 

### For further information, please contact Ray Shubert, Air Quality Planning Section, (512) 239-6615. 

## DIVISION 1. 

## BEAUMONT-PORT ARTHUR OZONE NONATTAINMENT AREA UTILITY ELECTRIC GENERATION SOURCES 30 TAC §117.1020 Statutory Authority The amendment is proposed under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.103, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.105, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amendment is also proposed under THSC, §382.002, concerning Policy and Purpose. that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amendment is also proposed under THSC, §382.016, concerning Monitoring Requirements; Examination of Records. that authorizes the commission to prescribe rea

## 36 TexReg 7142 October 21, 2011 Texas Register sonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amendment is also proposed under Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, et seq., 

### which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state. The amendment implements TWC, §§5.1 02, 5.1 03, and 5.1 05; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq. 

### §

### 117.1020. System Cap. (a) An owner or operator of an electric generating facility (EGF) may achieve compliance with the nitrogen oxides 

### (NO) emission specifications of §117.1010 ofthis title (relating to Emission Specifications for Attainment Demonstration) by achieving equivalent 

### NOx emission reductions obtained by compliance with a daily and 30-day system cap emission limitation in accordance with the requirements ofthis section. (b) Each EGF within an electric power generating system, as defined in§ 117.10 ofthis title (relating to Definitions), that would otherwise be subject to the 

### NO, emission rates of §117.1010 ofthis title must be included in the system cap. (c) The system cap must be calculated as follows. (I) A rolling 30-day average emission cap must be calculated using the following equation. Figure: 30 TAC §117.1020(c)(l) (No change.) (2) A ma'<imum daily cap mustbe calculated using the following equation. Figure: 30 TAC §117.1020(c)(2) (No change.) (3) Each EGF in the system cap is subject to the emission limits ofboth paragraphs (1) and (2) ofthis subsection at all times. (d) The 

### NOx emissions monitoring required by §117.1040 of this title (relating to Continuous Demonstration of Compliance) for each EGF in the system cap must be used to demonstrate continuous compliance with the system cap. (e) For each operating EGF, the o>vner or operator shall use one ofthe following methods to provide substitute emissions compliance data during periods when the 

### NO, monitor is off-line: (1) ifthe 

### NO, monitor is a continuous emissions monitoring system (CEMS): (A) subject to 40 Code ofFederal Regulations (CFR) Part 75, use the missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data Substitution Procedures); or (B) subject to 40 CFR Part 75, Appendix E, use the missing dataprocedures specified in 40 CFRPart 75, Appendix E, §2.5 (Missing Data Procedures); (2) use Appendix E monitoring in accordance with §117.I040(d) ofthis title; (3) ifthe 

### NOx monitor is a predictive emissions monitoring system (PEMS): (A) use the methods specified in 40 CFR Part 75, Subpart D; or(B) use calculations in accordance with §117.8110(b) ofthis title (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or (4) use the maximumblock one-hour emission rate as measured by the 30-day testing. (f) The owner or operator ofany EGF subject to a system cap shall maintain daily records indicating the NO, emissions and fuel usage from each EGF and summations oftotal NO, emissions and fuel usage for all EGFs underthe system cap on a daily.basis. Records must also be retained in accordance with §117.I045 ofthis title (relating to Notification, Recordkeeping, and Reporting Requirements). (g) The owner or operator ofany EGF subject to a system cap shall report any exceedance ofthe system cap emission limit within 48 hours to the appropriate regional office. The owner or operator shall then follow up within 2I days ofthe exceedance with a written report to the regional office that includes an analysis ofthe cause for the exceedance with appropriate datato demonstrate the amount ofemissions in excess ofthe applicable limit and the necessary corrective actions taken by the company to assure future compliance. Additionally, the owner or operator shall submit semiannual reports for the monitoring systems in accordance with §117.I045 ofthis title. (h) The owner or operator of any EGF subject to a system cap shall demonstrate initial compliance with the system cap in accordance with the schedule specified in §117.9IOO ofthis title (relating to Compliance Schedule for Beaumont-Port Arthur Ozone Nonattainment Area Utility Electric Generation Sources). (i) AnEGF that is permanently retiredor decommissioned and rendered inoperable may be included in the system cap emission limit, provided that the permanent shutdown occurred after January I, I999. The system cap emission limit is calculated in accordance with subsection (b) ofthis section. (j) Emission reductions from shutdowns or curtailments that have been used for netting or offset purposes under the requirements ofChapter 116 ofthis title (relating to Control ofAir Pollution by Permits for New Construction or Modification) may not be included in the baseline for establishing the cap. (k) For the purposes ofdetermining compliance with the system cap emission limit, the contribution ofeach affected EGF that is operating during a startup, shutdown, or emissions event as defined in §IO 1.1 ofthis title (relating to Definitions) must be calculated from the NO, emission rate measured by the NO, monitor, if operating properly. Ifthe NO, monitor is not operating properly, the substitute data procedures identified in subsection (e) ofthis section must be used. If neither the NO,monitor nor the substitute data procedure are operating properly, the owner or operator shall use the maximum daily rate measured during the initial demonstration ofcompliance, unless the owner or operator provides data demonstrating to the satisfaction ofthe executive director and the United States Environmental Protection Agency that actual emissions were less than maximum emissions during such periods. (I) An owner or operator of a source ofNO, who is participating in the system cap under this section may exceed their system cap provided that the owner or operator is complying with the requirements of§ 117.9800 ofthis title (relating to Use ofEmission Credits for Compliance) or Chapter IOI, Subchapter H, Division I or 4 [, 

### 4-, &**~]** ofthis title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking and Trading[t**-and~** Gap .ffadffig])
0 (m) In the event that a unit within an electric power generating system is sold or transferred, the unit must become subject to the transferee's system cap. This agency hereby certifies thatthe proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt. Filed with the Office ofthe Secretary of State on October 7, 2011. TRD-201104234 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Earliest possible date of adoption: November 20, 2011 For further information, please call: (512) 239-0779 

# • • 

# • DIVISION 2. DALLAS-FORT WORTH OZONE NONATTAINMENT AREA UTILITY ELECTRIC GENERATION SOURCES 30 TAC §117.1120 Statutory Authority The amendment is proposed under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.1 03, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amendment is also proposed under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amendment is also proposed under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amendment is also proposed under Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, et seq., which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state. The amendment implements TWC, §§5.1 02, 5.1 03, and 5.1 05; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq
. 

### §117.1120. System Cap.



## PROPOSED 

## RULES October 21, 2011 36 TexReg 7143(a) An owner or operator of an electric generating facility (EGF) may achieve compliance with the nitrogen oxides 

### (NO) emission specifications of§ 117.1110 ofthis title (relating to Emission Specifications for Attaimnent Demonstration) by achieving equivalent NO, emission reductions obtained by compliance with a daily and 30-day system cap emission limitation in accordance with the requirements ofthis section. (b) Each EGF within an electric power generating system, as defined in §117.10 ofthis title (relating to Definitions), that would othenvise be subject to the NO, emission rates of§117.1110 ofthis title must be included in the system cap. (c) The system cap must be calculated as follows. (1) A rolling 30-day average emission cap must be calculated using the following equation. Figure: 30 TAC §117.1120(c)(l) (No change.) (2) A maximum daily cap must be calculated using the following equation. Figure: 30 TAC §117.1120(c)(2) (No change.) (3) Each EGF in the system cap is subject to the emission limits ofboth paragraphs (1) and (2) ofthis subsection at all times. (d) The NO, emissions monitoring required by §117.1140 of this title (relating to Continuous Demonstration of Compliance) for each EGF in the system cap must be used to demonstrate continuous compliance with the system cap. (e) For each operating EGF, the owner or operator shall use one ofthe following methods to provide substitute emissions compliance data during periods when the NO, monitor is off-line: (1) ifthe NO, monitor is a continuous emissions monitoring system (CEMS): (A) subject to 40 Code ofFederal Regulations (CFR) Part 75, use the missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data Substitution Procedures); or (B) subject to 40 CFR Part 75, Appendix E, use the missing data procedures specified in 40 CFR Part 75, Appendix E, §2.5 (Missing Data Procedures); (2) use Appendix E monitoring in accordance with §117.1140(d) ofthis title; (3) iftheNO,monitor is apredictive emissions monitoring system (PEMS): (A) use the methods specified in 40 CFR Part 75, Subpart D; or (B) use calculations in accordance with §117.8110(b) ofthis title (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or (4) ifthe methods specified in paragraphs (1)- (3) ofthis subsection are not used, the owner or operator shall use the maximum block one-hour emission rate as measured by the 30-day testing. (f) The owner or operator ofany EGF subject to a system cap shall maintain daily records indicating the NO, emissions and fuel usage from each EGF and summations oftotal NO, emissions and fuel usage for all EGFs under the system cap on a daily basis. Records must also be retained in accordance with §117.1145 ofthis title (relating to Notification, Recordkeeping, and Reporting Requirements). (g) The owneror operator ofany EGF subject to a system cap shall report any exceedance ofthe system cap emission limit within 48



## 36 TexReg 7144 October 21, 2011 Texas Register hours to the appropriate regional office. The owner or operator shall then follow up within 21 days ofthe exceedance with a written report to the regional office that includes an analysis ofthe cause for the exceedance with appropriate datato demonstrate the amountofemissions in excess ofthe applicable limit and the necessary corrective actions taken by the company to assure future compliance. Additionally, the owner or operator shall submit semiannual reports for the monitoring systems in accordance with §117.1145 ofthis title. (h) The owner or operator ofany EGF subject to a system cap shall demonstrate initial compliance with the system cap in accordance with the schedule specified in §117.9110 ofthis title (relating to Compliance Schedule for Dallas-Fort Worth Ozone Nonattainment Area Utility Electric Generation Sources). (i) An EGFthat is permanently retired or decommissioned and rendered inoperable may be included in the system cap emission limit, provided that the permanent shutdown occurred after January I, 1999. The system cap emission limit is calculated in accordance with subsection (b) ofthis section. (j) Emission reductions from shutdowns or curtailments that have been used for netting or offset purposes under the requirements ofChapter 116 ofthis title (relating to Control ofAir Pollution by Permits for NewConstruction orModification) may notbe included in the baseline for establishing the cap. (k) For the purposes ofdetermining compliance with the system cap emission limit, the contribution ofeach affected EGF that is operating during a startup, shutdown, or emissions event as defined in §101.1 ofthis title (relating to Definitions) mustbe calculated from the NOx emission rate measured by the NO, monitor, ifoperating properly. Ifthe NO, monitor is not operating properly, the substitute data procedures identified in subsection (e) ofthis section must be used. If neitherthe NO,monitornorthe substitute data procedure are operating properly, the owner or operator shall use the maximum daily rate measured during the initial demonstration ofcompliance, unless the owner or operatorprovides data demonstrating to the satisfaction ofthe executive director and the United States Enviromnental Protection Agency that actual emissions were less than maximum emissions during such periods. (!) An owner or operator of a source ofNO, who is participating in the system cap under this section may exceed their system cap provided that the owner or operator is complying with the requirements of§117.9800 ofthis title (relating to Use ofEmission Credits for Compliance) or Chapter 101, Subchapter H, Division 1 or 4 [, 4; m 

### -S-] ofthis title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking and Trading[t -arui-System Gap +roiling]). (m) Inthe event that aunit within an electric power generating system is sold or transferred, the unit must become subjectto the transferee's system cap. The value 

## I\ in this section is based on the unit's status as part ofa large or small system as ofJanuary 1, 2000, and does not change as a result ofsale or transfer ofthe unit, regardless ofthe size ofthe transferee's system. This agency herebycertifies thatthe proposal has been reviewed by legal counsel and found to bewithin the agency's legal authority to adopt. Filed with the Office ofthe Secretary of State on October7, 2011

. TRD-2011 04235Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Earliest possible date of adoption: November 20, 2011 For further information, please call: (512) 239-0779 

# • 

# • • DIVISION 3. HOUSTON-GALVESTONBRAZORIA OZONE NONATTAINMENT AREA UTILITY ELECTRIC GENERATION SOURCES 30 TAC §117.1220 Statutory Authority The amendment is proposed under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.103, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amendment is also proposed under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amendment is also proposed under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amendment is also proposed under Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, et seq., 

### which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state. The amendment implements TWC, §§5.1 02, 5.1 03, and 5.1 05; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401 et seq. 

### §117.1220. System Cap. (a) An owner or operator of an electric generating facility (EGF) shall comply with a daily and 30-day system cap nitrogen oxides 

### (NO) emission limitation in accordance with the requirements ofthis section. (b) Each EGF within an electric power generating system, as defined in §117.10 ofthis title (relating to Definitions), that is subject to §117.121O(a) of this title (relating to Emission Specifications for Attainment Demonstration) must be included in the system cap. (c) The system cap must be calculated as follows. (1) A rolling 30-day average emission cap must be calculated using the following equation. Figure: 30 TAC §117.1220(c)(l) (No change.) (2) A maximum daily cap must be calculated using the following equation. Figure: 30 TAC §117.1220(c)(2) (No change.) (3) Each EGF in the system cap is subject to the emission limits ofboth paragraphs (1) and (2) ofthis subsection at all times. (d) The NOx emissions monitoring required by §117.1240 of this title (relating to Continuous Demonstration of Compliance) for each EGF in the system cap must be used to demonstrate continuous compliance with the system cap. (e) For each operating EGF, the owner or operator shall use one ofthe following methods to provide substitute emissions compliance data during periods when the NOx monitor is off-line: (1) ifthe NO, monitor is a continuous emissions monitoring system (CEMS): (A) subject to 40 Code ofFederal Regulations (CFR) Part 75, use the missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data Substitution Procedures); or (B) subject to 40 CFR Part 75, Appendix E, use the missing data procedures specified in40 CFRPart 75, AppendLx E, §2.5 (Missing Data Procedures); (2) use 40 CFR Part 75, Appendix E monitoring in accordance with §117.1240(e) ofthis title; (3) ifthe NO, monitor is apredictive emissions monitoring system (PEMS): (A) use the methods specified in 40 CFR Part 75, Subpart D; or (B) use calculations in accordance with §117.81IO(b) ofthis title (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or (4) ifthe methods specified in paragraphs (1)- (3) ofthis subsection are not used, the owner or operator shall use the maximum block one-hour emission rate as measured by the 30-day testing. (f) The owner or operator shall maintain daily records indicating the NO, emissions and fuel usage from each EGF and summations oftotal NOx emissions and fuel usage for all EGFs under the system cap on a daily basis. Records must also be retained in accordance with §117.1245 ofthis title (relating to Notification, Recordkeeping, andReporting Requirements). (g) The owner or operator shall report any exceedance ofthe system cap emission limit within 48 hours to the appropriate regional office. The owner or operator shall then follow up within 21 days ofthe exceedance with a written report to the regional office that includes an analysis ofthe cause for the exceedance with appropriate data to demonstrate the amount ofemissions in excess ofthe applicable limit and the necessary corrective actions taken by the company to assure future compliance. Additionally, the owner or operator shall submit semiannual reports for the monitoring systems in accordance with §117.1245 ofthis title. (h) The owner or operator shall demonstrate initial compliance with the system cap in accordance with the schedule specified in §117.9120 ofthis title (relating to Compliance Schedule for HoustonGalveston-Brazoria Ozone NonattainmentAreaUtility Electric Generation Sources).



## PROPOSED RULES October 21,2011 36 TexReg 7145(i) AnEGFthat is permanently retired ordecommissioned and rendered inoperable may be included in the system cap emission limit, provided that the permanent shutdown occurred after January I, 2000. The system cap emission limit is calculated in accordance with subsection (b) ofthis section. 

## G) Emission reductions from shutdowns or curtailments that have been used for netting or offset purposes under the requirements ofChapter 116 ofthis title (relating to Control ofAir Pollution by Permits for New Construction orModification) may not be included in the baseline for establishing the cap. (k) For the purposes ofdetermining compliance with the system cap emission limit, the contribution ofeach affected EGF that is operating during a startup, shutdown, or emissions event as defined in 

### §101.1 ofthis title (relating to Definitions) must be calculated from the NO, emission rate measured by the NO, monitor, ifoperating properly. Ifthe NO, monitor is not operating properly, the substitute data procedures identified in subsection (e) ofthis section must be used. If neither the NO monitor nor the substitute data procedure are operating properly, the

### o~ner or operator shall use the maximum daily rate measured during the initial demonstration ofcompliance, unless the owner or operator provides data demonstrating to the satisfaction ofthe executive director and the United States Environmental Protection Agency that actual emissions were less than maximum emissions during such periods. (I) An owner or operator of a source ofNO, who is participating in the system cap under this section may exceed their system cap providedthat the owner or operator is complying with the requirements of§117.9800 ofthis title (relating to Use ofEmission Credits for Compliance) or Chapter 101, Subchapter H, Division 1 or 4 [;- 4-, BF**~]** ofthis title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking and Trading[t 

### andSystemGaf) 

### -+maffig])

0 (m) In the event that a unit within an electric power generating system is sold or transferred, the unit must become subject to the transferee's system cap. 

### This agency hereby certifies thatthe proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt. Filed with the Office ofthe Secretary ofState on October 7, 2011. TRD-2011 04236 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Earliest possible date of adoption: November 20, 2011 For further information, please call: (512) 239-0779 

# • • 

# • SUBCHAPTER E. MULTI-REGION COMBUSTION CONTROL DIVISION 1. 

## UTILITY ELECTRIC GENERATION IN EAST AND CENTRAL TEXAS 30 TAC §117.3020 Statutory Authority The amendment is proposed under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the com

## 36 TexReg 7146 October 21, 2011 Texas Register mission with the general powers to carry out its duties under the TWC; TWC, §5.1 03, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amendment is also proposed under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amendment is also proposed under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amendment is also proposed under Federal Clean Air Act (FCM), 42 United States Code (USC), §§7401, 

### et seq., which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state. The amendment implements TWC, §§5.1 02, 5.1 03, and 5.1 05; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and FCM, 42 USC, §§7401 

### et seq. 

### §117.3020. System 

### Cap. (a) An owner or operator may achieve compliance with the nitrogen oxides 

### (NO) emission specifications of §117.3010 ofthis title (relating to Emission Specifications) by achieving equivalent NO, emission reductions obtained by compliance with a system cap emission limitation in accordance with the requirements ofthis section. (b) Each unit within an electric power generating system, as defined in§ 117.10 ofthis title (relating to Definitions), that would otherwise be subject to the NO, emission specifications of §117.3010 of this title must be included in the system cap. (c) The annual average emission cap must be calculated using the following equation. Figure: 30 TAC §117.3020(c) (No change.) (d) The NO, emissions monitoring required by §117.3040 of this title (relating to Continuous Demonstration of Compliance) for each unit in the system cap must be used to demonstrate continuous compliance with the system cap. (e) Foreach operating unit, the owneroroperator shall use one ofthe following methods to provide substitute emissions compliance data during periods when the NO, monitor is off-line: (1) ifthe NO, monitor is a continuous emissions monitoring system (CEMS): (A) subject to 40 Code ofFederal Regulations (CFR) Part 75, use the missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data Substitution Procedures); or(B) subject to 40 CFR Part 75, Appendix E, use the missing dataprocedures specified in 40 CFR Part75, Appendix E, §2.5 (Missing Data Procedures); (2) use Appendix E monitoring in accordance with §117.3040(e) ofthis title; (3) ifthe NO,monitor is apredictive emissions monitoring system (PEMS): (A) use the methods specified in 40 CFR Part 75, Subpart D; or (B) use calculations in accordance with §117.8110(b) ofthis title (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or (4) use the maximum emissionrate as measuredby the testing conducted in accordance with §117.3035(d) ofthis title (relating to Initial Demonstration ofCompliance). (f) The owner or operator ofany unit subject to a system cap shall maintain daily records indicating the NO, emissions and fuel usage from each unit and summations oftotal NO, emissions and fuel usage for all units under the system cap on a daily basis. Records must also be retained in accordance with §117.3045 ofthis title (relating to Notification, Recordkeeping, and Reporting Requirements). (g) The owner or operator ofany unit subject to a system cap shall submit annual reports for the monitoring systems in accordance with §117.3045 ofthis title. The owner or operator shall also report any exceedance ofthe system cap emission limit in the annual report and shall include an analysis ofthe cause for the exceedance with appropriate datato demonstrate the amount ofemissions in excess ofthe applicable limit and the necessary corrective actions taken by the company to assure future compliance. (h) The owner or operator ofany unit subject to a system cap shall demonstrate initial compliance with the system cap in accordance with the schedule specified in§ 117.9300 ofthis title (relating to Compliance Schedule for Utility Electric Generation in East and Central Texas). (i) A unit that is permanently retired or decommissioned and rendered inoperable may be included in the' system cap emission limit, provided that the permanent shutdown occurred on or after January 1, 1999. The system cap emission limit is calculated in accordance with subsection (b) ofthis section. (j) Emission reductions from shutdowns or curtailments that have been used for netting or offset purposes under the requirements ofChapter 116 ofthis title (relating to Control ofAir Pollution by Permits for New Construction or Modification) may not be included in the baseline for establishing the cap. (k) For the purposes ofdetermining compliance with the system cap emission limit, the contribution ofeach affected unit that is operating during a startup, shutdown, or emissions event as defined in §101.1 ofthis title (relating to Definitions) must be calculated from the NO, emission rate measured by the NOx monitor, if operating properly. Ifthe NOx monitor is not operating properly, the substitute data procedures identified in subsection (e) ofthis section must be used. If neitherthe NOx monitor northe substitute data procedure are operating properly, the owner or operator shall use the maximum daily rate measured during the initial demonstration ofcompliance, unless the owner or operator provides data demonstrating to the satisfaction ofthe executive director and United States Environmental Protection Agency that actual emissions were less than ma'l:imum emissions during such periods. (I) An owner or operator ofa source ofNOx in any ofthe east and central Texas attainment counties listed in §117.3000(a)(4) ofthis title (relating to Applicability) who is participating in the system cap under this section (relating to System Cap) may exceed their system cap provided that the owner or operator is complying with the requirements ofChapter 101, Subchapter H, Division 1 or 4**[-,4,&~]** ofthis title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking and Trading[t

### -aOOSystemGap .'I'fad.i.llg]). This agency hereby certifies thatthe proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt. Filed with the Office ofthe Secretary ofState on October 7, 2011. TRD-2011 04237 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Earliest possible date of adoption: November 20, 2011 For further information, please call: (512) 239-0779 

# • 

# • • SUBCHAPTER H. ADMINISTRATIVE PROVISIONS DIVISION 2. COMPLIANCE FLEXIBILITY 30 TAC §117.9800 Statutory Authority The amendment is proposed under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.1 03, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5. 105, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code {THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amendment is also proposed under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amendment is also proposed under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amendment is also proposed under Federal Clean Air Act (FCM), 42 United States Code (USC), §§7401, 

### et seq., which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state.



## PROPOSED 

## RULES October 21, 2011 36 TexReg 7147The amendment implements TWC, §§5.1 02, 5.1 03, and 5.1 05; THSC, §§382.002, 382.011, 382.D12, 382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq. §117.9800. Use of Emission Credits for Compliance. (a) An owner or operator ofa unit not subject to Chapter IOI, Subchapter H, Division 3 ofthis title (relating to Mass Emissions Cap and Trade Program) may meet emission control requirements ofthe sections specified in paragraphs (I)- (8) ofthis subsection, in whole or in part, by obtaining an emission reduction credit (ERC), mobile emission reduction credit (MERC), discrete emission reduction credit (DERC), ormobile discrete emission reduction credit (MDERC) in accordance with Chapter IOI, Subchapter H, Division I or 4 ofthis title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking and Trading), unless there are federal or state regulations or permits under the same commission account number that contain a condition or conditions precluding such use: (I) §§117.105, 117.205, 117.305, 117.I005, 117.1105, or II7.I205 ofthis title (relating to Emission Specifications for Reasonably Available Control Technology (RACT)); (2) §§ 117.110, 117.210, 117.I0IO, or 117.1110 ofthis title (relating to Emission Specifications for Attainment Demonstration); (3) §§ 117.1015, II7.1115, or 117.I2I5 ofthistitle (relating to Alternative System-Wide Emission Specifications); (4) §§117.115, 117.215,or 117.315ofthistitle(relatingto Alternative Plant-Wide Emission Specifications); (5) §§117.123, 117.223,117.323, 117.423,or§117.3120of this title (relating to Source Cap); (6) §§ 117.2010, 117.3010, or 117.3110 of this title (relating to Emission Specifications); (7) §§117.410, 117.1310, 117.21IO, or Il7.3310 of this title (relating to Emission Specifications for Eight-Hour Attainment Demonstration); or (8) §117.3123 ofthis title (relating to Dallas-Fort Worth Eight-Hour Ozone Attainment Demonstration Control Requirements). (b) An owner or operator of a unit subject to §§117.320, 117.1020, 117.1120, 117.1220, or 117.3020 ofthis title (relating to System Cap) may meet the emission control requirements of these sections in whole or in part, by complying with the requirements of Chapter I01, Subchapter H, Division I or 4**~.§.]of** this**title~ [~**  te .£ysrem**~ ~**  

### BF] by obtaining an ERC, MERC, DERC, or MDERC2 [.ffi accordance with

## Gbat*er .f4l, Subchapter H,**~+BF4-ef-thlstitle,]** unless there are federal or state regulations or permits under the same commission account number that contain a condition or conditions precluding such use. (c) For the purposes ofthis section, the term "reduction credit (RC)" refers to an ERC, MERC, DERC, or MDERC, whichever is applicable. (d) Any lower nitrogen oxides (NO,) emission specification established under this chapter for the unit or units using RCs requires the userof the RCsto obtain additionalRCs in accordance with Chapter 101, SubchapterH, Division 1or 4 ofthis title and/or otherwise reduce emissionspriorto the effective date ofsuchrule change. Forunits using RCs in accordance with this section that are subject to new, more stringent rule limitations, the owner or operator using the RCs shall submit a revised final control plan to the executive director in accordance with §§117.156, 117.256,117.356,117.456, 117.1056,117.1156, 117.I256, and I17.1356 ofthis title (relating to Revision ofFinal Control Plan) to revise the basis for compliance with the emission specifications ofthis



## 36 TexReg 7148 October 21, 2011 Texas Register chapter. The owner or operator using the RCs shall submit the revised final control plan as soon as practicable, butno later than 90 days prior to the effective date ofthe new, more stringent rule. The owner or operator ofthe unit(s) currently using RCs shall calculate the necessary emission reductions per unit as follows. Figure: 30 TAC §117.9800(d) (No change.) This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt. Filed with the Office ofthe Secretary ofState on October 7, 2011. TRD-2011 04238 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Earliest possible date of adoption: November 20, 2011 For further information, please call: (512) 239-0779 

# • TITLE 40. SOCIAL TANCE 

## PART 1. DEPART AND DISABILITY S CHAPTER 1. STATE AUTHORITY RESPON 

# • RVICES AND 

## ASSIS
## NT OF AGING RVICES

SUBCHAPTER I. 

## IN- OME AND FAMILY SUPPORT MENTAL RE ARDATION PROGRAM 40 TAC §§1.401

- 1.405, 1.40 , 1.409, 1.411 (Editors note: The text of thefoll wing sectionsproposed for repeal willnotbepublished. The sections aybe examinedin the offices of the Department of Aging andDisabili Services or in the Texas Register office, Room 245, James Earl Ru der Building, 1019 Brazos Street, Austin, Texas.) The Health and Human Serv ces Commission (HHSC) proposes, on behalf of the Dep rtment of Aging and Disability Services (DADS), the repeal o Subchapter I, §§1.401

- 1.405, 1.407, 1.409, and 1.411, gov rning the In-Home and Family Support Mental Retardation Pr ram, in Chapter 1, State Mental Retardation Authority Respons bilities. BACKGROUND AND PURPO E The purpose of the repeal is to remove rules concerning the InHome and Family Support Me tal Retardation {IHFS-MR) Program. The 82nd Legislature, egular Session, 2011, passed a budget for fiscal years 2012 an 2013 that eliminated funding for the IHFS-MR program. The res onsibility ofa local mental retardation authority (MRA) to admi ister the program ends September 1, 2011. SECTION-BY-SECTION SUM ARY The proposed repeal of §1.40 removes rules concerning the purpose of the subchapter. The proposed repeal of §1.40 removes rules concerning the application of the subchapter. The proposed repeal of §1.40 removes rules concerning definitions used in the subchapter.

### Notice ofPublic Hearing on roposed Revisions to 30 TAC Chapter 116 and to the State I plementation Plan The Texas Commission on E vironmental Quality (commission) will conduct a public hearing to receive testimony on proposed new §116.128, Permit Amend nt Application, Public Notice and Contested Case Hearing Proced res for Certain Electric Generating Facilities, of30 TAC Chapter 11 , Control ofAir Pollution by Permits for New Construction or Modific tion, and corresponding revisions to the state implementation plan (S P) under the requirements ofTexas Health and Safety Code, §382.01 ; Texas Government Code, Chapter 2001, Subchapter B; and 40 Co ofFederal Regulations §51.102 of the United States Environmental rotection Agency (EPA) concerning SIPs. The proposed rulemaking would plement §4.27 and §4.30 ofHouse Bill2694, 82nd Legislature, 2011 by establishing public notice, comment, and contested case hearin procedures for permit amendment applications for electric generaf g facilities to comply with the Federal Clean Air Act, §112. The commission will hold a pub! c hearing on this proposal in Austin on November 17, 2011 at 10:00 .m. in Building E, Room 201S, at the commission's central office I cated at 12100 Park 35 Circle. The hearing is structured for the recei t oforal or written comments by interested persons. Individuals rna present oral statements when called upon in order ofregistration. 

### 0 en discussion will not be permitted during the hearipg; however, com ission staffmembers will be available to discuss the proposal 30 m utes prior to the hearing. Persons who have special com unication or other accommodation needs who are planning to atten the hearing should contact Sandy Wong, Office ofLegal Services, t (512) 239-1802. Requests should be made as far in advance as pos "ble. Written comments may be su mitted to Michael Parrish, MC 205, Office of Legal Services, Texas Commission on Environmental Quality, P.O. Box 13 87, Austin, Texas 78711-3087, or faxed to (512) 239-4808. Electronic comments may be submitted at: http://ww 5.tceq.texas.gov/rnles/ecomments/. File size restrictions may ap ly to comments being submitted via the eComments syste All comments should reference Rule Project Number 011-029-116-AI. The comment period closes November 21, 011. Copies of the proposed rulemaking can be obtained fr m the commission's website at http://www.tceq.texas.gov/nav/rnl s/propose_adopt.html. For further information, please contact Beec er Cameron, Air Permits Division, (512) 239-1495 or at beecher.cam ron@tceq.texas.gov. TRD-201104231 Robert Martinez Director, Environmental Law Divisi n Texas Commission on Environme al Quality Filed: October 7, 2011 

# • 

# • Notice ofPublic Hearings on Proposed Revisions on 30 TAC Chapters 101 and 117 and to the State Implementation Plan The Texas Commission on Environmental Quality (commission) will conduct public hearings to receive testimony regarding proposed revisions to 30 TAC Chapter 101, General Air Quality Rules, and Chapter 117, Control ofAir Pollution from Nitrogen Compounds, and corresponding revisions to the state implementation plan (SIP) under the requirements ofTexas Health and Safety Code, §382.017; Texas Government Code, Chapter 2001, Subchapter B; and 40 Code ofFederal



## 36 TexReg 7196 October 21, 2011 Texas Register Regulations §51.102, and the United States Environmental Protection Agency (EPA) concerning SIPs. The proposed rulemaking would repeal all rules pertaining to the System Cap Trading program specified in Chapter 101, Subchapter H, Division 5, §§101.380, 101.382, 101.383, and 101.385. In addition, §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800, relating to System Caprules, would be amendedto removereferencesto the Chapter 101 System Cap Trading program. Public hearings on this proposal will be held at the following times and locations: in Houston on November 15, 2011, at 1:30 p.m. and 6:00 p.m. in Conference Room C at the Houston-Galveston Area Council located at 3555 Timmons Lane; and in Austin on November 17, 2011, at 2:00p.m. at the Texas Commission on Environmental Quality, Building E, Room 201 S, at the commission's central office located at 12100 Park 35 Circle. The hearings will be structured for thereceipt oforal or written comments by interested persons. Registration will begin 30 minutes prior to each hearing. Individuals may present oral statements when called upon in order ofregistration. There will be no open discussion during the hearings; however, commission staff members will be available to discuss the proposals 30 minutes before the hearings. Persons planning to attend the hearings who have special communication orother accommodation needs should contact Sandy Wong, Office ofLegal Services, at (512) 239-1802. Requests should be made as far in advance as possible. Comments may be submitted to Charlotte Hom, Texas Register Team, Office ofLegal Services, Texas Commission on Environmental Quality, MC 205, P.O. Box 13087, Austin, Texas 78711-3087, or faxed to (512) 239-4808. Electronic comments may be submitted at http://www5.tceq.texas.gov/rules/ecomments/. File size restrictions may apply to comments being submitted via the eComments system. All comments should reference Rule Project Number 2011-018-101-EN. The comment period closes Novembe_r 21, 2011. Copies ofthe proposed rules can be obtained from the commission's website at http://www.tceq.texas.govlnav/ntleslpropose

_adopt.html. For further information, please contact Shantha Daniel, Air Quality Planning Section, (512) 239-3930. TRD-2011 04232 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Filed: October 7, 2011 

# • 

# • Notice ofWater Quality Appli The following notices were issued n September 30, 2011 through October 7, 2011. The following require the applic Public comments, requests for pu tested case hearing may be submi Mail Code 105, P.O. Box 13087, 30 DAYS OF THE DATE OF NE NOTICE. INFORMATION SECTION s to publish notice in a newspaper. ic meetings, or requests for a cond to the Office ofthe ChiefClerk, stin, Texas 78711-3087, WITHIN SPAPER PUBLICATION OF THE

AIR LIQUIDE LARGE INDUS ES U.S. LP, which operates the Nederland Air Seperation Unit, a cryogenic air seperation plant that produces oxygen, nitrogen, and gon, has applied for a renewal of Texas Pollutant Discharge Elimin tion System (TPDES) Permit No. WQ0001595000, which authoriz s the discharge of treated cooling

### BryanW. Shaw, Ph.D., 

### Chairman Buddy Garcia, 

### Commissioner Carlos Rubinstein, 

### Commissioner Mark R. 

### Vickery, P.G., 

### Executive Director



## TEXAS COMMISSION ON ENVIRONMENTAL QUALITY Protecting Texas 

### byReducing andPreventing Pollution 

## NOTICE OFPUBLICHEARINGS BYTIIE TEXAS COMMISSIONONENVIRONMENTALQUALI1Y ONPROPOSEDREVISIONS TO 30

## TAC CHAPTERS 101

## AND 117

## ANDTO THE STATE IMPLEMENTATIONPLAN The Texas Commission on Environmental Quality (commission) will conduct public hearings to receive testimonyregarding proposed revisions to 30 TAC Chapter 101, GeneralAir Quality Rules and Chapter 117, Control ofAir Pollution From Nitrogen Compounds, and corresponding revisions to the state implementationplan (SIP) under the requirements ofTexas Health and Safety Code, §382.017; Texas Government Code, Chapter 2001, Subchapter B; and 40 Code of Federal Regulations §51.102, and the United States Environmental ProtectionAgency (EPA) concerning SIPs. The proposed rulemaking would repeal all rules pertaining to the System Cap Trading program specified in Chapter 101, Subchapter H, Division 5, §§101.380, 101.382, 101.383, and 101.385. In addition, §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800, relating to System Cap rules, would be amendedto remove references to the Chapter 101 System Cap Trading program. Public hearings on this proposal will beheld atthe following times andlocations: in Houston on November 15, 2011, at 1:30 p.m. and 6:00p.m. in Conference Room Catthe Houston-Galveston Area Council located at 3555 Timmons Lane; and inAustin on November 17, 2011, at 2:00p.m. at the Texas Commission on Environmental Quality, Building E, Room 201S, at the commission's central office located at 12100 Park 35 Circle. The hearings will be structuredfor the receipt oforal or written comments byinterested persons. Registration will begin 30 minutes priorto each hearing. Individuals may present oral statements when called upon in order ofregistration. There will be no open discussion during the hearings; however, commission staffmembers will be available to discuss the proposals 30 minutesbefore the hearings. Persons planning to attendthe hearings who have special communication or other accommodation needs should contact SandyWong, Office ofLegal Services at (512) 239-1802. Requests shouldbe made as far in advance as possible. Comments maybe submittedto Charlotte Horn, Texas Register Team, Office ofLegal Services, Texas Commission on Environmental Quality, MC 205, P.O. Box 13087, Austin, Texas 78711- 3087, orfaxed to (512) 239-4808. Electronic comments maybe submitted at 

# http:jjwwws.tceq.texas.govjrulesjecommentsj. File size restrictions may applyto comments being submittedvia the eComments system. All comments should reference Rule Project Number 2011-018-101-EN. The commentperiod closes November 21, 2011. Copies ofthe proposed rules canbe obtainedfrom the commission's Web site at 

# http:/ jwww.tceq.texas.govjnavjrulesjpropose_adopt.html. Forfurther information, please contact Shantha Daniel, Air Quality Planning Section, (512) 239-3930.

P.O. Box 13087 • Austin, Texas 78711-3087 • 512-239-1000 • tceq.texas.gov How is our customer service? tceq.texas.gov/goto/customersurvey printed on recycled paper

# TESTIMONY

### INDEX OF WRITTEN TESTIMONY

Reference Number Submitted by
W-1 

### JeffRobinson, United States Environmental Protection Agency

### UNITED STATES ENVIRONMENTAL PROTECTION AGENCY REGION6



## Ms. Charlotte Hom Texas RegisterTeam (MC 205) Office ofLegal Services 1445 ROSS AVENUE, SUITE 1200 DALLAS TX 75202-2733 

# NOV 0 12011

Texas Commission on Environmental Quality P.O. Box 13087 Austin, Texas 78711-3087 

# W-1

RE: U.S. Environmental Protection Agency (EPA) Comments on Proposed Revisions to 30 Texas Administrative Code (TAC) Chapters 101 and 117
Dear Ms. Horn: Thank you for the opportunityto review and comment on the proposed revisions to 30 TAC, Chapters 101 and 117. These revisions propose the repeal ofall rules pertaining to the System Cap Trading (SCT) Program under 30 TAC Chapter 101, Subchapter H, Division 5, Sections 101.380, 101.382, 101.383 and 101.385 and the cross-references to the SCT Program at Chapter 117, Sections 117.1020, 117.1120, 117.1220, 117.3020, and 117.9800. The Texas Commission on Environmental Quality (TCEQ) withdrew the above referenced Chapter 101 rules from our consideration as revisions to the Texas State hnplementation Plan by letter dated March 4, 2011. In 

## this letter, the TCEQ also indicated the intent to repeal the above Chapter 101 and Chapter 117 rules pertaining to the SCT Program from the Texas regulations. The EPA supports the repeal ofthe SCT Program and all associated cross-references to the SCT Program as proposed. We believe the repeal ofthese provisions will clarify the available compliance options for electric generating units in Texas.
We appreciate the timely efforts ofthe TCEQ to repeal this program, consistent with the March 4, 

## 2011, letter. Ifyou have any questions about our comments today, please feel free to contact me at (214) 665-6435 or contact Ms. Adina Wiley ofmy staffat (214) 665-2115.

# V~l?~ JeffRobinson Chief Air Permits Section

Internet Address {URL) • http://www.epa.gov/region6 Recycled/Recyclable • Printed with Vegetable Oil Based InkS on 100% Recycled Paper, Process Chlorine Free

## INDEX OF ORAL TESTIMONY



## November 15, 2011, 1:30 p.m. - Houston-GalvestonArea Council 

## NO ORALTESTIMONYWAS RECEIVED PERTAININGTOTHIS RULE REVISION.

November 15, 2011, 6:oop.m.

- Houston-Galveston Area Council 

## NO ORALTESTIMONYW AS RECEIVED PERTAININGTO THIS RULE REVISION.

November 17, 2011, 2:00p.m.

- TCEQ 

## NO ORALTESTIMONYW AS RECEIVED PERTAININGTOTHIS RULE REVISION.

# - 1 - 

# Texas Commission on Environmental Quality Public Hearing Registration
Date: November 15,2011 

## Time: 1:30PM 

## Rule ProjectNo.: 2011-018-101-EN 

## ShortTitle: Repeal ofChapter 101 

## System Cap Trading Rules and Revisions to Chapter 117 Location: Conference Room C atthe Houston-GalvestonArea Council located at 3555

## Timmons Lane Concerning: Proposed Revisions to 30

## TAC Chapters 101 

## and 117 

## andto the StateImplementation Plan 

# /0c;

Name and Phone No. or E-mailAddress

# {R,r~n; Presenting Oral Testimony? 

### (Please Print) 

# - (Circle One)

# ~\

# yv Yes 

## No 

# /

# ~ 

# \(, \**~** \' \ 

### Yes 

## No 

# \\:\ \ 

# \-\ \')

# \' Yes 

## No 

# \ c--\

# ~

# ~j Yes 

## No

# ~\**~** 

# / 

# \ ) Yes 

## No 

# \""\ Yes 

## No 

## '\ Yes 

## No

Yes 

## No

## HEARINGOFFICER REPORT



## I am the hearing officer assigned to conduct the public hearing regarding revisions to 30 

## TAC Chapter 101, 

## General Air Quality Rules and Chapter 117, 

## Control of Air Pollution from Nitrogen Compounds. The proposed rulemaking would repeal all rules pertaining to the System Cap Trading program specified in Chapter 101, 

## Subchapter H, Division 5 and amend §§117.1020, 117.1120, 117.1220, 117.3020, 

## and 117.9800, 

## relating to System Cap rules, to remove references to the Chapter 101 

## System Cap Trading. A public hearing was scheduled for November 15, 2011, 

## at 1:30 

## p.m. in Conference Room C at the Houston-Galveston Area Council located at 3555 

## Timmons Lane. At 1:00 

## p.m., the room was open and TCEQ staff members were available to discuss the proposal. At 1:30 

## p.m., TCEQ staffand a court reporter were present and readyto open the hearing for public comment. After waiting for 30 

## minutes, no one had arrived to make comments on the record. Therefore, the public hearing was notformally openedfor comment and a transcriptwas notprepared.

Hearing Officer

Date sign d

# - 1 - 

# Texas Commission onEnvironmental Quality Public Hearing Registration
Date: November 15,2011 

## Time: 6:ooPM 

## Rule Project No.: 2011-018-101-EN 

## ShortTitle: Repeal ofChapter 101 

## System Cap Trading Rules and Revisions to Chapter 

## 117 Location: Conference Room Catthe Houston-GalvestonArea Council located at 3555

## Timmons Lane 

## Concerning: Proposed Revisions to 30

## TAC Chapters 101 

## and 117 

## andtothe State Implementation Plan

Name and Phone No. or E-mail Address

# ~g Presenting Oral Testimony? (Please Print) (Circle One)

# ""'~

# \G/ Yes 

## No

# /~j~\ \)\__; 

### Yes 

## No

# ~~/\ '(;\ Yes 

## No 

# \**~** \. 

# \\\**\~~\** Yes 

## No 

# \C\\ \)

# ~- 

# '"' Yes 

## No /

# \~'J / Yes 

## No 

# \ Yes 

## No

Yes 

## No

## HEARING OFFICER REPORT



## I am the hearing officer assigned to conduct the public hearing regarding revisions to 30 

## TAC Chapter 101, 

## General Air Quality Rules and Chapter 117, 

## Control of Air Pollution from Nitrogen Compounds. The proposed rulemaking would repeal all rules pertaining to the System Cap Trading program specified in Chapter 101, 

## Subchapter H, Division 5 

## and amend §§117.1020, 117.1120, 117.1220, 117.3020, 

## and 117.9800, 

## relating to System Cap rules, to remove references to the Chapter 101 

## System Cap Trading. A public hearing was scheduled for November 15, 2011, 

## at 6:oo p.m. in Conference Room C at the Houston-Galveston Area Council located at 3555 

## Timmons Lane. At 5:30 

## p.m., the room was open and TCEQ staff members were available to discuss the proposal. At 6:oop.m., TCEQ staff and a court reporter were present andready to open the hearing for public comment. After waiting for 30 

## minutes, no one had arrived to make comments on the record. Therefore, the public hearing was notformally openedfor comment and a transcriptwas notprepared.

# Hea~~-

Date signed···-···-····**~~---••••--•-•·•···-·--** ··-···••••-•••-··-····--·-··•·•--•••--•·., M•o •·••·· 0

. ••**··-·-·------~--** .. ··-··--· ····-·•· •·••• •"•**.~··~··••••w.-·-••··---------------7_,-•** --•••- -·-··----.....,....------ 

# - 1 - 

# Texas CommissiononEnvironmental Quality Public Hearing Registration

- November 1h 2011 2:oop.m. 

## Rule ProjectNo.:2011-018-lo1-EN ShortTitle: Repeal ofChapter 101 SystemCap Trading ProgramRules andRevisionsto Chapter 117 Location: TCEQ complex, 12100 Park35 Circle,AustinTexas, BuildingE, Room 2018 Concerning: System CapTradingProgram**~**



### Name Representing PresentingOralTestimony? (PleasePrint) 

### (Circle One) 

# 'S**'v\a!~ ~**  0-QQn'\- 

# mol

# la.t4" ---rf\W\\J-CC Yes 

## @>

Yes 

## No

Yes 

## No

Yes 

## No

Yes 

## No

Yes 

## No

Yes 

## No

Yes 

## No

## HEARINGOFFICERREPORT



## I am the hearing officer assigned to conduct the public hearing regarding revisions to 30 TAC Chapter 101, General Air Quality Rules and Chapter 117, Control ofAir Pollution from Nitrogen Compounds. The proposed rulemaking would repeal all rules pertaining tothe System Cap Trading program specified in 

## Chapter 101, 

## Subchapter H, Division 5 andamend §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800, relating to System Cap rules, to remove references to the Chapter 101 System Cap Trading. A public hearing was scheduled for November 17, 2011, at 2:00p.m. in Building E, Room 201S at the Texas Commission on Environmental Quality main complex, Austin, Texas. At 1:30 p.m., the room was open and TCEQ staff members were available to discuss the proposal. At 2:00 p.m., TCEQ staffand a court reporter were present andready to open the hearing for public comment. After waiting for 30 minutes, one person had signed in but did not wish to present testimony. Therefore, the public hearing was not formally opened for comment and a transcript was not prepared.

Hearing Officer 

# I

Date signed

# EVALUATION

# Texas Commission on Environmental Quality InterofficeMemorandum
To: 

## Commissioners 

## Date: February4, 2011 Thru: LaDonna Castafiuela, Chief Clerk MarkR. Vickery, P.G. Executive Director



## From: Susana

# M. Hildebrand, P.E., Chief

# Engine~
DocketNo.: 2010-1983-MIS 

## Subject: CommissionApproval for Withdrawal ofTitle 30 Texas Administrative , Code §§101.380, 101.382, 101.383, and 101.385, System Cap Tradingfrom the United States EnvironmentalProtection Agency's (EPA) Consideration as a Revision to the StateImplementationPlan (SIP) 

## Backgroundandreason(s)fortherulemaking: Title 30 TexasAdministrative Code (TAC) §§101.380, 101.382, 101.383, and 101.385 as adoptedonMarch 21, 2001, and amendedonJuly 25, 2007, are includedinthe revisions tothe SIP. These sections specifytherequirements ofthe System Cap Trading (SCT) Program, createdtoprovide additional flexibilitytofacilities with system cap emission limits specifiedin 30TAC Chapter 117. The sections were submittedtothe EPA as revisions to the SIP onMay 1, 2001, andthe amendmentsto §101.383.and §101.385, were submittedtotheEPA as revisions tothe SIP onAugust 16, 2007. On October 25, 2010, the EPA, which is under a consentdecree·

·deadlinethatrequires final action onthe SCT ProgrambyDecember 31, 2010, senta letter tothe commissionrequesting revisions tothe program. The October 25, 2010, letterfrom the EPA also statedits intenttotakefavorable action onthe SCT ProgramiftheTexas Commission on Environmental Quality (TCEQ) agreedto committo a rulemaking action to implementthe EPA's requestedrevisions. The EPArequireda verbal commitmentby November 1, 2010, followedbya signedletterfrom the Executive DirectorbyNovember 15, 2010. OnNovember 2, 2010, theExecutive Director submitteda letterinresponsetothe EPA's request statingthatduetothe shorttimeline, the TCEQ wouldbeunabletopresentthe EPA's requestedrevisions tothe commission, andthe commissionwouldbeunabletotake any actiontoimplementthese revisions onthe EPA's proposedtimeline. Theletter also statedtheExecutive Director's intentionto seekapprovalfrom the commissionto withdrawthe SCT Programfrom the EPA's considerationbasedon a preliminaryreview of the programthatindicatedminimal participationby affected sources. In addition, affected sourceshave alternative means ofcompliance withthe system cap emissionlimits of Chapter 

# 117intheform ofthe Emission Credit Banking andTrading Program andthe Discrete Emission Credit Banking andTrading Program. ,On November 18,2010,the EPA publishedits proposed disapproval ofthe SCT Programinthe

## FederalRegister (75 FR 70654). The EPAhas received an extensionuntil May 30, 2011, totakefinal action onthe SCT Program.

## Commissioners Page2 February4, 2011 Re: Docket No. 2010-1983-MIS

Staffrecommends removingfrom considerationbythe EPA as a revisiontothe SIP §§101.380, 101.382, 101.383, and 101.385 which containtherequirements ofthe SCT Program andwere createdto provide additional flexibilitytofacilities with system cap emissionlimits specifiedin §§117.320, 117.1020, 117.1120, 117.1220, and 117.3020. The program allows source ownerstotrade surplus emission allowables within a single nonattainmentareaorwithin anothersingle areawithunique emissionlimits asidentified in Chapter 117. Sections 101.380, 101.382, 101.383-, and 101.385 are proposedfor disapprovalbythe EPA, andthe EPAis subjectto a settlementagreementthatrequires final actionbyMay 30, 2011. It

## is therefore.recommendedthat §§101.380, 101.382, 101.383, and 101.385be removedfrom the EPA's consideration as a SIP revision priortothe EPAtakingfinal action to disapprovetherules. 

## Scopeofthe recommendation: A.) 

## Summaryofwhattherulemakingwill do: 

## Ifapproved, a request

# will bemade to the EPAto remove §§101.380, 101.382, 101.383, and 101.385 from consideration as a revision tothe SIP. B.) 

## Scoperequiredbyfederal regulationsorstatestatutes: No. 

## C.) Additionalstaffrecommendationsthat arenotrequiredbyfederal ruleor statestatute: · • remove §§101.380, 101.382, 101.383, and101.385 from considerationbythe EPA as a revision tothe SIP; and • initiate rulemaking at a latertimeto remove the SCT Program and anyreferences to the SCT Programin Chapter 117.· 

## Statutoryauthority: Texas CleanAirAct, Texas Health and Safety Code, §382.011, relatingto General Powers andDuties; §382.012, StateAir Control Plan; §382.014; relatingto Emission Inventory; §382.016, relatingto Monitoring Requirements; Examination ofRecords; and §382.017, Rules. · 

## Effect onthe: A.) 

## Regulatedcommunity: No impactis expected. Therehasbeenminimal participation inthe SCT Programbythe regulatedcommunitydue to the availability of alternative compliance means such as theuse ofEmission Credit BankingandTrading Program andthe Discrete Emission CreditBanking andTradingProgram. 

## B.) Public: No directfiscal impactis anticipatedtothepublic. 

## C.) Agencyprograms:A rulemakingprojectto removethe SCT Program and any referencestothe programin Chapter 117 shouldbecompleted as soon as practicable.

## Commissioners Page3 February4, 2011 Re: Docket No. 2010-1983-MIS



## Stakeholdermeetings: NotApplicable 

## Potentialcontroversialconcerns andlegislativeinterest: Ifthe SCT Programis repealed, the compliance options available totheregulated community.willbecomelimited, especiallyiftheregulatedcommunitydoes nothave access tothe required Discrete EmissionCredits orEmission Credits tomeetthe system cap emissionlimits specified

## in Chapter 117. 

## Willthis rulemakingaffectanycurrentpolicies orrequire developmentof newpolicies? Futurerulemakingwillberequiredto removethe SCT Program and any referencestotheprograminChapter 117. 

## Whataretheconsequencesifthis recommendationdoesnotgoforward? Are therealternativestothis recommendation? TheEPAhas alreadypublished a proposeddisapproval ofthe SCT Program (75 FR70654). 

## Ifrequesttowithdrawthe SCT Programfrom theEPA's consideration does notgo forward, the EPAwill issue a final disapproval ofthe SCT Program. Therules pertainingtothe SCT Programwill havetoberepealed orrevised andresubmittedtothe EPA, andrules 

## in Chapter 117 will needtoberevisedtoreflectthisrepeal. However, theEPAhas statedthat sincethe SCT Program was notsubmittedto meet a mandatoryrequirement ofthe Federal CleanAirAct, no sanctions andFederal Implementation Programtimelineswillbe initiated (75 FR70656). 

## Agencycontacts: ShanthaDaniel, Ph.D., Project Manager, 239-3930, Air QualityDivision Amy Browning, StaffAttorney, 239-0891 

## Attachments

cc: ChiefClerk, 2 

## copies 

## Executive Director's Office Susana M. Hildebrand, P

## .E. Kevin Patteson Curtis Seaton Ashley Morgan Office ofGeneral Counsel ShanthaDaniel, Ph.D.

## EVALUATION OF TESTIMONY



## The Texas Commission on Environmental Quality (commission) adopts the repeal of§§101.380, 101.382, 101.383, 

## and 101.385

## Without changes to theproposedtext as published in the October 21, 2011, 

## issue ofthe 

## Texas Register (36 

## TexReg 7124).



## BackgroundandSummaryofthe FactualBasisfortheAdoptedRules
On March 21, 2001, 

## the commission adoptedrules establishing the requirements for the System Cap Trading (SCT) program in Chapter 101, 

## Subchapter H, Division 5, §§101.380, 101.382, 101.383, 

## and 101.385.



## The SCT program was establishedto provide the owners oroperators ofaffected electric generating facilities (EGF) With an additional compliance option to meetthe system cap emission limits specifiedin 30

## Texas Administrative Code (TAC) Chapter 117, 

## Control ofAir Pollution from Nitrogen Compounds. The EGFs affected bythe Chapter 117 

## system cap emission limits are located inthe Beaumont-PortArthur 1997

## eight-hour ozone maintenance area, consisting ofHardin, Jefferson, and Orange Counties (BPA area); the Houston-GalvestonBrazoria 1997

## eight-hour ozone nonattainment area, consisting ofBrazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, andWaller Counties (HGB area); andinthe East and Central Texas counties ofAtascosa, Bastrop, Bexar, Brazos, Calhoun, Cherokee, Fannin, Fayette, Freestone, Goliad, Gregg, Grimes, Harrison, Henderson, Hood, Hunt,**Lama~;,** 

## Limestone, Marion, McLennan, Milam, Morris, Nueces, Parker, Red River, Robertson, Rusk, Titus, Travis, Victoria, andWharton.

1

## The system cap emission limits in Chapter 117 

## setdaily, 30-dayrolling average, or annual emission caps ontotal nitrogen oxides (NOX) emissions from EGFs that are: subjectto the Chapter 117 

## emission specifications for attainment demonstration (ESAD); under common ownership or control; and groupedtogetherin an electricpower generating system, as defined in §117.10(14). 

## For example, ifcompanyAhas three sites, X, Y, andZwith three, four, andfive EGFs, respectively, that are subject to the Chapter 117 

## ESADs and are partofan electric power generating system, Chapter 117 

## sets a daily, 30-dayrolling average, or annual emission caps on thetotal emissions from the 12 

## affected EGFs. The SCT program provides additional compliance flexibility to owners ofEGFs operating under a system cap to exceed the system cap at discrete periods oftime bypurchasing surplus emission allowables, which were generated during the

same time period, from other owners ofEGFs also operating under a system cap. Surplus emission allowables are calculated as the difference between the amount ofemissions in a Chapter 117 

## system cap emissionlimit andthe actual emissions from that electricpower generating system. Trading ofsurplus emissions allowables is allowed onlybetween owners or operators ofelectric power generating systems thathave the same type ofChapter 117 

## system
cap emission limit (i.e., daily, 30-dayrolling average, or annual emission caps) and are within the same nonattainment area. Owners oroperators ofEGFs located inthe East and Central Texas counties can only trade surplus emissions allowables with other owners oroperators of EGFs located inthese counties.

The SCT programhas seen minimal participationwith most reports submittedfor compliance
purposes showing no trades. In cases where trading was reported, thepurchased surplus emission allowables were not usedto meetthe system cap emissionlimit(s). In addition, owners

oroperators ofaffected EGFs have alternative compliance options to meetthe Chapter 117 

## system cap emission limits. Inthe BPA and HGB areas, alternative compliance options are

2

## available via the Emission Credit Banking andTrading and Discrete Emission Credit Banking andTrading (DERC) programs. Inthe counties ofEast and Central Texas, alternative compliance options are available via the DERC program.

The Chapter 101 

## SCT program rules were submittedto the United States Environmental ProtectionAgency (EPA) as revisions to the state implementationplan (SIP) on May 1, 2001. 

## Sections 101.383 

## and 101.385

## were amended on July 25, 2007, 

## to accuratelyreference the renumbered Chapter 117 

## sections relatedto the system cap emission limits. These amendments

were submittedto the EPA as a revision to the SIP onAugust 16, 2007.



## The EPA sent a letter, dated October 25, 2010, 

## to the commission requesting revisions to the Chapter 101 

## SCT program rules. Inthe letter, the EPA stated its intent to conditionally approve the Chapter 101 

## SCT programrules ifthe commission agreed to commit to a rulemaking action
to implement the EPA's requested revisions within a one-yeartime frame. The EPA required a verbal commitmentbyNovember 1, 2010, 

## followed by a signedletterfrom the executive director byNovember 15, 2010. 

## On November 2, 2010, 

## the executive director respondedtothe EPA's request stating that due to the minimal participation inthe SCT program and the limited timeline to implement the revisions requestedbythe EPA, the commission would notbe able to committo anyrulemaking action. The letter also statedthe executive director's intentionto seek approval from the commission to withdrawthe Chapter 101 

## SCT programrules from the EPA's consideration as a revision to the SIP. The EPA published its proposed disapproval ofthe Chapter 101 

## SCT program rules inthe November 18, 2010, 

## issue ofthe Federal Register (75 

## FR
70654).



## 3

## OnFebruary 23, 2011, 

## the commission approvedthe withdrawal ofthe Chapter 101 

## SCT
programrules from considerationbythe EPA as a revision tothe SIP. The EPA was notified of this withdrawal in a letter dated March 4, 2011. 

## The EPA acknowledged the withdrawal ofthe Chapter 101 

## SCT program rules from consideration as a SIP revision in a letterreceivedbythe commission onApri14, 2011, 

## andpublished its withdrawal ofthe proposed disapproval ofthe SCT program rules intheAprilS, 2011, 

## issue ofthe Federal Register (76 

## FR 19739).



## The repeal ofthe Chapter 101 

## SCT program rules is adopted concurrentlywith amendments to sections in Chapter 117

## thatwould remove references to the Chapter 101 

## SCT program rules. The amendments to Chapter 117

## are published in a separate rulemaking inthis issue ofthe Texas Register.



## Section

## bySectionDiscussion
The adoptedrepeal ofDivision 5, 

## System Cap Trading, §§101.380, 101.382, 101.383, 

## and 101.385 

## will remove all rules related tothe SCT program from Chapter 101. 

## The SCT program was established to provide additional compliance flexibility to owners ofEGFs subject to the system
cap emission limits specified in Chapter 117; 

## however, theprogramhas seen minimal participationby affected sources. The Chapter 101 

## SCT program rules have been withdrawn from considerationbythe EPA as a revision to the SIP and are notfederally enforceable. The Chapter 117

## rules specifying the system cap emission limits have been approvedbythe EPA as a SIP revision and are therefore federally enforceable. The repeal ofthe SCT program rules will avoid anypotential regulatory confusion among owners or operators ofaffected EGFs regarding the use ofa compliance option thatis no longerfederally enforceable to meet a federally enforceable rule.

4

## Final DraftRegulatory ImpactAnalysis
The commission reviewed the repeal ofthe SCT program rules from Chapter 101 

## inlight ofthe regulatory impact analysis requirements ofTexas Government Code, §2001.0225, 

## and determinedthatthe repeal does not meet the definition ofa major environmental rule as definedin that statute, andin addition, ifthe rule did meet the definition, itwould notbe subjectto the requirement toprepare a regulatoryimpact analysis.

A major environmental rule means a rule, the specific intent ofwhich is toprotectthe environment or reduce risks tohumanhealth from environmental exposure andthat may adversely affect in a material waythe economy, a sector ofthe economy, productivity, competition,jobs, the environment, orthe publichealth and safety ofthe state or a sector ofthe
state. Instead, the specific intentofthe repeal is to remove rules related to the SCT program from Chapter 101. 

## The SCT program was established to provide additional compliance flexibility
to sources subject to the system cap emissionlimits specifiedin Chapter 117; 

## however, it has only seen minimal participationbyaffected sources. The SCT programrules in Chapter 101 

## have beenwithdrawn from considerationbythe EPA as a revision to the SIP and are not federally enforceable, while the Chapter 117 

## rules specifying the system cap emission limits have been approvedbythe EPA as a SIP revision and are therefore federally enforceable. The repeal ofthe SCT rules in Chapter 101 

## will avoid potential regulatory confusion among owners or operators ofsources subject to the system cap emissionlimits in Chapter 117

## byremoving a compliance flexibility option thatis notfederally enforceable. The repeal is not anticipated to add any significant additional costs to affected individuals orbusinessesbeyond what is already requiredto complywiththese federal standards onthe economy, a sector ofthe economy,



## 5

## productivity, competition,jobs, the environment, orthepublic health and safety ofthe state or a
sector ofthe state.

Additionally, the repeal does not meet any ofthe four applicability criteriafor requiring a regulatory impact analysis for a major environmental rule, which arelisted inTexas Government Code, §2001.0225(a). Texas Government Code, §2001.0225, applies only to a major environmental rule, the result ofwhich is to: 1) 

## exceed a standard setbyfederal law, unless the rule is specifically requiredbystatelaw; 2) exceed an express requirement ofstate law, unless the rule is specifically requiredbyfederal law; 3) exceed a requirement ofa delegation agreement orcontractbetweenthe state and an agency or representative ofthe federal governmentto implement a state andfederal program; or4) adopt a rule solely under the generalpowers ofthe agency instead ofunder a specific statelaw.

The repeal will avoid potentialregulatory confusion among owners oroperators ofEGFs subject
to the system cap emission limits in Chapter 117 

## byremoving a compliance flexibility option that is not federally enforceable. The repeal does not exceed a requirement ofa delegation agreement

or a contractbetween state andfederal government ifthis rulemaking is adopted. The repeal

was not developed solely under the general powers ofthe agency, butis authorizedbyspecific sections ofTexas Health and Safety Code, Chapter 382 (also known as the Texas Clean Air Act), andthe Texas Water Code, which are cited inthe StatutoryAuthority section ofthis rulemaking. Therefore, this repeal is not subject to the regulatory analysis provisions ofTexas Government Code, §2001.0225(b).



## 6

## The commission invited public comment regarding the draft regulatory impact analysis determination duringthe public commentperiod. No comments were received on the draft regulatory impact analysis determination.



## Takings ImpactAssessment
UnderTexas Government Code, §2007.002(5), 

## taking means a governmental action that affects private real property, inwhole orin partortemporarilyorpermanently, in a mannerthat requires the governmental entityto compensate the private real propertyowner as providedby the Fifth and FourteenthAmendments to the United States Constitution or §17 

## or §19, 

## Article I, Texas Constitution; or a governmental action that affects an owner's private real propertythatis the subject ofthe governmental action, inwhole orinpartortemporarily orpermanently, in a

mannerthatrestricts orlimits the owner's righttothe propertythatwould otherwise exist inthe absence ofthe governmental action; andis the producing cause ofa reduction ofatleast 25% 

## in the marketvalue ofthe affected private real property, determinedbycomparing the market value ofthe propertyas ifthe governmental action is not ineffect andthe marketvalue ofthe property determined as ifthe governmental action is in effect.

The commission completed a takings impact analysis for the adopted repeal underTexas Government Code, §2007.043.

## The adopted rulemaking repeals rules related to the SCT
program from Chapter 101. 

## The repeal will not create any additionalburden on private real property. The repeal will not affect private real propertyin a mannerthatwould require compensation toprivate real propertyowners underthe United States Constitution orthe Texas Constitution. The repeal also will not affect private real propertyin a mannerthatrestricts or limits an owner's right to the propertythatwould otherwise exist inthe absence ofthe



## 7

## governmental action. Therefore, the repeal will not cause a taking underTexas Government Code, Chapter 2007.



## Consistencywiththe CoastalManagement Program
The commission reviewed the adopted rulemaking and found thatitis subject to the Texas Coastal Management Program (CMP) in accordance withthe Coastal CoordinationAct, Texas Natural Resources Code, §§33.201 

## et seq., andtherefore mustbe consistentwith all applicable CMP goals andpolicies. The commission conducted a consistency determination for the adopted rulemaking in accordance with Coastal CoordinationAct Implementation Rules, 31 

## TAC §505.22 

## andfound the adopted rulemaking is consistent with the applicable CMP goals andpolicies.

The CMP goal applicable to the adopted rules include to protect, preserve, restore, and enhance the diversity, quality, quantity, functions, andvalues ofcoastal natural resource areas (CNRA) (31 

## TAC §501.12(1)). 

## The CMP policy applicable to the adopted rulemaking is thepolicythat commission rules complywith federal regulations in 40 

## Code ofFederal Regulations, toprotect and enhance air quality in the coastal areas so as to protect CNRAs andpromote the public health, safety, and welfare (31 

## TAC §501.32). 

## The adopted rulemaking will notincrease emissions ofairpollutants and is therefore consistentwith the CMP goal in 31 

## TAC §501.12(1) 

## andthe CMP policy in 31 

## TAC §501.32.



## Promulgation and enforcement ofthis rulemaking will notviolate orexceed any standards identified inthe applicable CMP goals andpolicies because the adopted rulemaking is consistent with these CMP goals and policies and does not create orhave a direct or significant adverse



## 8

## effect on anycoastal natural resource areas. Therefore, in accordance with 31 TAC §505.22(e), the commission affirms thatthis rulemaking action is consistentwith CMP goals andpolicies.

The commission invitedpublic commentregarding the consistencywith the CMP during the public commentperiod. No comments were received on the CMP.



## Effect on Sites Subjectto the Federal Operating Permits Program Chapter 101 is an applicable requirement under 30 TAC Chapter 122, Federal Operating Permits Program. Owners oroperators withfacilities subject to the federal operating permitprogram
mustrevise their operatingpermitto remove all references to the SCT program rules. The

owners oroperators ofthese facilities will have the option ofinitiating a permit action orwaiting for the next permit action, such as a renewal, to remove these references.



## Public Comment
The commission scheduled public hearings in Houston onNovember 15, 2011, andinAustin on November 17, 2011. However, since no one registered to provide comments, the hearings were
not officially opened. The commentperiod closed on October 21, 2011. The commission received one written commentfrom the EPA.



## Response to Comments
The EPA statedits support ofthe repeal ofthe SCT program and all associated references to the SCT program in Chapter 117. The EPA further statedthatthe repeal ofthe SCT programwill clarify the available compliance options for electric generating units in Texas.

9

## The commission appreciates the support and makes no changes to the rule based onthis
comment.

10

## EVALUATION OF TESTIMONY



## The Texas Commission on Environmental Quality (commission) adopts amendments to §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800 without changes to theproposed text as published in the October 21, 2011, issue ofthe 

## Texas Register (36 TexReg 7138) andthe text will
notbe republished.

The amendments will be submittedtothe United States Environmental ProtectionAgency (EPA) as a revision to the state implementation plan (SIP).



## Background andSummaryofthe Factual BasisfortheAdoptedRules
On March 21, 2001, the commission adoptedrules thatprovided owners oroperators ofelectric generating facilities (EGF) located inthe Dallas-FortWorth one-hour ozone nonattainment area (consisting ofCollin, Dallas, Denton, andTarrantCounties) orthe East and CentralTexas counties, as listed in §117.3000(a)(4), and subjectto the system cap emissionlimits specified in Chapter 117 additional compliance flexibility in meeting their system caps through participation inthe System Cap Trading (SCT) program. The SCT program was established through rules adoptedbythe commission on March 21, 2001, specifying the requirements for the SCT
programin 30 TAC Chapter 101, Subchapter H, Emissions Banking andTrading.

The system cap emissionlimits in Chapter 117 setdaily, 30-dayrolling average, or annual emission caps ontotal nitrogen oxides (NOX) emissions from EGFs that are: subjectto the Chapter 117 emission specifications for attainment demonstration (ESAD); under common ownership or control; and groupedtogetherin an electric power generating system, as defined

1

## in §117.10(14). For example, ifcompanyAhas three sites, X, Y, andZwiththree, four, andfive EGFs, respectively, that are subjectto the Chapter 117 ESADs and are partofan electric power generating system, Chapter 117 sets a daily, 30-dayrolling average, or annual emission caps on the total emissions from the 12 affected EGFs.

On May 23,2007, the commission adoptedreformatted and renumbered Chapter 117 rules. The adopted rules also provided newemission specifications for the Dallas-FortWorth 1997 eighthour ozone nonattainment area (DFW area), consisting ofCollin, Dallas, Denton, Ellis, Johnson, Kaufman, Parker, Rockwall, andTarrant Counties, necessaryto demonstrate the attainment of the 1997 eight-hour ozone NationalAmbientAir Quality Standards (NAAQS). Underthe adopted rules, EGFs inthe Collin, Dallas, Denton, orTarrant Counties that are subject to the

new emissions specifications are no longer required to meetthe emission specifications specified in Chapter 117, Subchapter B, Division 2, or Subchapter C, Division 2, after March 1, 2009. For EGFs inthe DFW area, the Chapter 117 rules do not allowparticipation in a system
cap as an alternative means ofcompliance with the new emissions specifications, andhence EGFs in the DFW area no longerhave the option ofparticipating inthe SCT program.

Certain compliance flexibility options (the SCT program, the Emission Credit Banking and Tradingprogram, andthe Discrete Emission Credit Banking andTrading program) were providedbythe adopted rules to owners or operators ofEGFs with system cap emission limits specifiedin Chapter 117 andlocated inthe Beaumont-PortArthur 1997 ozone maintenance area (BPA area), consisting ofHardin, Jefferson, and Orange Counties; the Houston-GalvestonBrazoria 1997 eight-hour ozone nonattainment area (HGB area), consisting ofBrazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, andWaller Counties; andinthe East and Central Texas counties ofAtascosa, Bastrop, Bexar, Brazos, Calhoun, Cherokee,

2

## Fannin, Fayette, Freestone, Goliad, Gregg, Grimes, Harrison, Henderson, Hood, Hunt, Lamar, Limestone, Marion, McLennan, Milam, Morris, Nueces, Parker, Red River, Robertson, Rusk, Titus, Travis, Victoria, andWharton. The adoptedrules also made clearthat EQ-Fs in the HGB

area are requiredto meetthe system cap emission limits specified in §117.320 

## or §117.1220, 

## in addition to complying with the emission specifications in §117.310 

## or §117.1210 

## through participationinthe Mass Emissions Cap andTrade program.

The SCT program rules in §101.383 

## and §101.385

## were amended onJuly 25, 2007, 

## to accurately reference the newly renumbered sections in Chapter 117

## relatedto system cap emissionlimits.

The SCT programhas seen minimal participationfrom affected sources, and on February 23, 2011, 

## the commission approvedthe withdrawal ofthe Chapter 101 

## SCT program rules from considerationbythe EPA as a revision to the SIP. The EPAwas notified ofthis withdrawal in a letter datedMarch 4, 2011. 

## While the repeal ofthe Chapter 101 

## SCT program rules and corresponding revisions to Chapter 117 

## are not specifically requiredbyfederal regulation, the Chapter 117

## rules for system cap requirements are included inthe SIP as published inthe December 3, 2008, 

## issue ofthe Federal Register (73 

## FR 73562) 

## and allow the SCT program as a regulatory option for compliance. Removing the references to the SCT program in Chapter 117 

## will avoid confusion among regulated entities that are subjectto the Chapter 117 

## system cap emissionlimits andwill address any potential concerns regarding the use ofa compliance option thatis notfederally enforceable to meet a federally enforceable rule.

The amendments to §§117.1020, 117.1120, 117.1220, 117.3020, 

## and 117.9800 

## are adopted concurrentlywiththe repeal ofsections pertaining to the SCT program from Chapter 101. 

## The



## 3

## repeal ofsections pertaining to the SCT programfrom Chapter 101 is published in a separate rulemaking in this issue oftheTexas Register.



## SectionbySectionDiscussion
The adoptedrulemaking will amend the major source rules in Chapter 117, Subchapter C, Divisions 1 - 3; Subchapter E, Division 1; and Subchapter H, Division 2. These adopted changes will amend §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800 byremoving references to Chapter 101 SCT program rules. The adopted rulemaking will also include various nonsubstantive revisions to these sections to conform to currentTexas Register style andformat requirements.

§§117.1020, 117.1120, 117.1220, 117.3020, System Cap
The adopted amendments to §§117.1020(1), 117.1120(1), 117.1220(1),**~nd** 

## 117.3020(1) remove all references to Chapter 101, Subchapter H, Division 5, SCT program.

§117.9800, Use ofEmission Credits for Compliance
The adopted amendments to §117.98oo(b) remove references to the SCT program requirements in Chapter 101, Subchapter H, Divisions.



## Final Draft Regulatory ImpactAnalysis
The commission reviewed the adopted rulemaking in light ofthe regulatory impact analysis requirements ofthe Texas Government Code, §2001.0225, and determinedthatthe adopted



## 4

## rulemaking does not meetthe definition ofa "major environmental rule" as defined in that
statute.

A "major environmental rule" means a rule, the specific intentofwhich is to protectthe environment orreduce risks to human health from environmental exposure, andthat may adversely affect in a material way the economy, a sector ofthe economy, productivity, competition,jobs, the environment, orthe publichealth and safety ofthe state or a sector ofthe
state. The purpose ofthe adoptedrulemaking is to remove the references tothe Chapter 101 SCT
programrules from Chapter 117. 

## The SCT rules in Chapter 101 arebeing repealed in a
concurrentrulemaking and are not a partofthe SIP. Therefore, the adopted rulemaking will

remove the option to usethe SCT program from Chapter 117 

## to avoid anypotential concerns that

a compliance option thatis notfederally enforceable mightbe usedto meet a federally enforceable rule.

Additionally, the adopted rulemaking does not meet any ofthe four applicability criteria for requiring a regulatory impact analysis for a major environmental rule, which are listed in Texas Government Code, §2001.0225(a). Texas Government Code, §2001.0225, applies onlyto a major environmental rule, the result ofwhich is to: 1) exceed a standard setbyfederal law, unless the rule is specifically requiredbystate law; 2) exceed an express requirement ofstate law, unless the rule is specificallyrequiredby federal law; 3) exceed a requirement ofa delegation agreement orcontractbetween the state and an agency or representative ofthe federal governmentto implement a state andfederal program; or4) adopt a rule solelyunder the general powers ofthe agencyinstead ofunder a specific statelaw.



## 5

## The requirement to provide a fiscal analysis ofthe adoptedregulations inthe Texas Government Code was amendedby Senate Bill (SB) 633 duringthe 75th Legislature, 1997. The intent ofSB 633 was to require agencies to conduct a regulatoryimpact analysis ofextraordinary rules. These are identified in the statutorylanguage as major environmental rules thatwill have a material adverse impact andwill exceed a requirement ofstate law, federal law, or a delegated federal program, or are adopted solely under the general powers ofthe agency. With the understanding thatthis requirementwould seldom apply, the commission provided a cost estimate for SB 633 concluding that "based on an assessment ofrules adoptedbythe agency in the past, itis not anticipatedthatthebill will have significant fiscal implications for the agency due to its limited application." The commission also noted thatthe number ofrules thatwould require assessment undertheprovisions ofthebill was notlarge. This conclusion was based, in part, on the criteria setforth inthebill that exemptedrules from the full analysis unless the rule

was a major environmental rule that exceeds a federal law.

The Federal Clean Air Act (FCAA) does not always require specific programs, methods, or reductions in orderto meetthe NAAQS; thus, states must develop programs for each area contributing to nonattainmentto help ensure thatthose areas will meet the attainment deadlines. Because ofthe ongoing need to address nonattainmentissues, and to meet the requirements of42 United States Code (USC), §7410, the commission routinely proposes and adopts SIP rules. Thelegislature is presumed to understand this federal scheme. If

## each rule adoptedfor inclusion inthe SIP was consideredtobe a major environmental rule that exceeds federal law, then every SIP rule would require thefull regulatory impact analysis contemplated by SB 633. This conclusion is inconsistent withthe conclusions reachedbythe commission in its
cost estimate andbythe Legislative Budget Board (LBB) in its fiscal notes. Since the legislature is presumed to understandthe fiscal impacts ofthebills itpasses, andthatpresumption is based



# 6

## oninformation providedbystate agencies andthe 

## LBB, the commissionbelieves thatthe intent ofSB 633 was only to require thefull regulatory impact analysis for rules that are extraordinary in nature. While the SIP rules will have a broadimpact, the impactis no greaterthanis
necessary or appropriate to meetthe requirements ofthe FCAA. Forthese reasons, rules adopted for inclusion inthe SIP fall under the exception inTexas Government Code, §2001.0225(a),because they are requiredby and do not exceed, federal law, including the approved SIP. In addition, these rules do not exceed any contractbetween the stateand a federal agency.

The commission has consistently applied this construction to its rules since this statute was enactedin 1997. Since thattime, thelegislature has revised theTexas Government Code butleft this provision substantially unamended. It

## is presumedthat "when an agency interpretationis in effect atthe time the legislature amends thelaws without making substantial change inthe statute, the legislature is deemedtohave acceptedthe agency's interpretation." Central Power & 

## Light Co. v. Sharp, 919 S.W.2d 485, 489 (Tex. App. Austin 1995), writ denied with percuriam opinion respecting another issue, 960 S.W.2d 617 (Tex. 1997); Bullockv. Marathon Oil Co., 798 S.W.2d 353, 357 (Tex. App. Austin 1990, no writ). Cf. Humble Oil & 

## Refining Co. v. Calvert, 414 S.W.2d 172 (Tex. 1967); Dudneyv. State Farm Mut. Auto Ins. Co., 9 S.W.3d 884,893 (Tex. App. Austin 2000); Southwestern Life Ins. Co. v. Montemayor, 24 S.W.3d 581 (Tex. App. Austin 2000, pet. denied); and Coastal Indust. WaterAuth. v. Trinity Portland Cement Div., 563 S.W.2d 916 (Tex. 1978).

The commission's interpretation ofthe regulatoryimpact analysis requirements is also supportedby a change made to the Texas Administrative ProcedureAct (APA) bythe legislature in 1999. In an attempttolimitthe number ofrule challenges based uponAPA requirements, the



## 7

## legislature clarified that state agencies are requiredto meetthese sections oftheAPA against the standard of"substantial compliance." Thelegislature specifically identifiedTexas Government Code, §2001.0225, 

## as falling underthis standard. The commission has substantiallycomplied withthe requirements ofTexas Government Code, §2001.0225.



### As 

## defined in the Texas Government Code, §2001.0225 

## only applies to a major environmental rule, the result ofwhich is to: exceed a standard setbyfederal law, unless the rule is specifically requiredbystatelaw; exceed an express requirement ofstate law, unless the rule is specifically requiredbyfederal law; exceed a requirement ofa delegation agreement orcontractbetween the
state and an agency orrepresentative ofthefederal government to implement a state andfederal
program; or adopt a rule solely underthe general powers ofthe agency instead ofunder a specific statelaw. This rulemaking action does not meet any ofthese four applicability requirements ofa "major environmental rule." The adopted rulemaking will remove an obsolete compliance option from Chapter 117, 

## andtherefore avoid anypotential concerns that a compliance option thatis notfederally enforceable mightbe usedto meet a federally enforceable rule. This rulemaking action does not exceed an express requirement ofstatelaw or a requirement ofa delegation agreement, andwas not developed solely under the general powers ofthe agency, butis authorized underTexas Health and Safety Code, §§382.011, 382.012, 

## and
382.017, 

## as well as under 42 

## USC, §§7401, 

## et seq., which requires statesto submit SIP revisions that specifythe mannerin which the NAAQS will be achieved and maintainedwithin each air quality control region ofthe state.

The commission invited public comment regarding the draft regulatory impact analysis determination during the public commentperiod. No comments were received on the draft regulatory impact analysis determination.


# 8

## TakingslrnpactAssessrnent
UnderTexas Government Code, §2007.002(5), 

## taking means a governmental action that affects private real property, in whole orin part ortemporarily orpermanently, in a manner that requires the governmental entityto compensate the private real propertyowner as providedby the Fifth and FourteenthAmendments to the United States Constitution or §17 

## or §19, 

## Article I, Texas Constitution; or a governmental action that affects an owner's private real propertythatis the subject ofthe governmental action, inwhole orinpartortemporarily orpermanently, in a

mannerthatrestricts orlimits the owner's right to the propertythatwould otherwise exist inthe absence ofthe governmental action; andis the producing cause ofa reduction ofatleast 25% 

## in the**m~rket** 

## value ofthe affected private real property, determinedbycomparing the market value oftheproperty as ifthe governmental action is not in effect andthe marketvalue ofthe property determined as ifthe governmental action is in effect.

The commission completed a takings impact analysis for the adopted repeal under Texas Government Code, §2007.043. 

## The adopted rules will remove the references to the Chapter 101 

## SCT programrules from Chapter 117. 

## The SCT program rules in Chapter 101 

## arebeing repealed in a concurrentrulemaking, and are not a part ofthe SIP. Therefore, the adopted rulemaking will remove the optiontouse the SCT program from Chapter 117

## to avoid any potential concerns that a compliance option thatis not federally enforceable mightbe usedto meet a federally enforceable rule. The adopted amendments will not create any additionalburden onprivate real property. The adopted amendments will not affect private real propertyin a mannerthatwould require compensation to private real propertyowners underthe United States Constitution or the Texas Constitution. The adopted amendmentswill not affect private real propertyin a

mannerthat restricts orlimits an owner's right to the propertythatwould otherwise exist inthe



## 9

## absence ofthe governmental action. Therefore, the adopted amendmentswill not cause a taking underTexas Government Code, Chapter 2007.



## Consistencywiththe CoastalManagement Program
The commission reviewed the adopted rulemaking andfound thatitis subjectto the Texas Coastal Management Program (CMP) in accordance with the Coastal CoordinationAct, Texas Natural Resources Code, §§33.201 

## et seq., andtherefore mustbe consistentwith all applicable CMP goalsandpolicies. The commission conducted a consistency determination for the adopted rules in accordance with Coastal CoordinationAct Implementation Rules, 31 

## TAC §505.22 

## and found the adoptedrulemaking is consistentwith the applicable CMP goals andpolicies.

The CMP goal applicable to the adoptedrulemaking is the goal toprotect, preserve, and enhance the diversity, quality, quantity, functions, andvalues ofcoastal natural resource areas (CNRA) (31 

## TAC §501.12(1)). 

## The CMP policy applicable to the adoptedrulemaking is thepolicythat commission rules comply withfederal regulations in40 

## Code ofFederal Regulations, toprotect and enhance air quality in the coastal areas so asto protect CNRAs and promote the public health, safety, andwelfare (31 

## TAC §501.32). 

## The adopted rulemaking will notincrease emissions ofair pollutants andis therefore consistentwith the CMP goal in 31 

## TAC §501.12(1) 

## andthe CMP policy in 31 

## TAC §501.32.



## Promulgation and enforcement ofthese rules will notviolate or exceed any standards identified in the applicable CMP goals and policiesbecause the adopted rules are consistent with these CMP goals andpolicies andbecause these rules do not create orhave a direct or significant adverse effect on any coastal natural resource areas. Therefore, in accordance with 31 

## TAC

10

## §505.22(e), the commission affirms thatthis rulemaking action is consistentwith CMP goals and policies.

The commission invitedpublic commentregarding the consistencywith the CMP during the public commentperiod. No comments were received concerning the CMP.



## Effect onSites Subjectto the Federal OperatingPermitsProgram Chapter 117 is an applicable requirementunder 30TAC Chapter 122, Federal Operating Permits Program. Owners or operators with facilities subject to thefederal operating permitprogram
mustrevise their operating permitto include the new Chapter 117 requirements. The owners or operators ofthese facilities will have the option ofinitiating a permit action orwaiting for the
nextpermit action, such as a renewal, to include these requirements.



## Public Comment
The commission scheduled public hearings in Houston onNovember 15, 2011, andinAustin on November 17, 2011. However, since no one registered toprovide comments, the hearings were
not officially opened. The commentperiod closed on October 21, 2011. The commission received

one written commentfrom the EPA in support ofthe rulemaking.



## Responseto Comments
The EPA statedits support ofthe repeal ofthe SCT program and all associated references tothe SCT program in Chapter 117. The EPA further statedthatthe repeal ofthe SCT programwill clarify the available compliance options for electric generating units inTexas.

11

## The commission appreciates the comment andthe support. No changes were madeto the rule based onthis comment.

12

# RECOMMENDATION

## SUBCHAPTERH: EMISSIONS BANKINGAND TRADING [DIVISION5: SYSTEM CAP TRADING] [§§101.380, 101.382, 101.383, 101.385] 

## StatutoryAuthority The repeals are adopted underTexas Water Code (TWC), §5.102, 

## concerning General Powers, thatprovides the commission with the general powers to carry outits duties undertheTWC; TWC, §5.103, 

## concerning Rules, that authorizes the commission to adopt rules necessaryto carry
outits powers and duties undertheTWC; TWC, §5.105, 

## concerning General Policy, that authorizes the commissionbyrule to establish and approve all general policy ofthe commission; andunderTexas Health and Safety Code (THSC), §382.017, 

## concerning Rules, that authorizes the commission to adopt rules consistentwith thepolicy andpurposes oftheTexas Clean Air Act. The repeals are also adoptedunderTHSC, §382.002, 

## concerning Policy and Purpose, that establishes the commission's purpose to safeguardthe state's air resources, consistentwith the protection ofpublic health, general welfare, andphysical property; THSC, §382.011, 

## concerning General Powers and Duties, that authorizes the commissionto control the quality ofthe state's air; andTHSC, §382.012, 

## concerning StateAir Control Plan, that authorizes the commission to
prepare and develop a general, comprehensive planfor the proper control ofthe state's air.

The adopted repeals implementTWC, §§5.102, 5.103, 

## and 5.105; 

## andTHSC, §§382.002, 382.011, 382.012, 

## and 382.017.

§101.380. 

## Definitions. §101.382. 

## Applicability. §101.383. 

## General Provisions. §101.385. 

## Recordkeeping and Reporting.

1

## SUBCHAYfERC: COMBUSTION CONTROLAT MAJORUTILITY ELECTRIC GENERATION SOURCES IN OZONE NONATTAINMENTAREAS DIVISION 1: 

## BEAUMONT-PORTARTHUROZONE NONATTAINMENT AREAUTILITY ELECTRIC GENERATION SOURCES §117.1020


## StatutoryAuthority 

## The amended section is adoptedunderTexas Water Code (TWC), §5.102, 

## concerning General Powers, thatprovides the commission withthe general powers to carry outits duties undertheTWC; TWC, §5.103, 

## concerning Rules, that authorizes the commission
to adopt rules necessaryto carry outits powers and duties undertheTWC; TWC, §5.105, 

## concerning General Policy, that authorizes the commissionbyrule to establish and
approve all general policy ofthe commission; andunderTexas Health and Safety Code (THSC), §382.017, 

## concerning Rules, that authorizes the commission to adopt rules consistentwiththepolicy andpurposes oftheTexas Clean Air Act. The amended section is also adoptedunderTHSC, §382.002, 

## concerning Policy and Purpose, that establishes the commission's purpose to safeguardthe state's air resources, consistentwith the protection ofpublichealth, general welfare, andphysical property; THSC, §382.011, 

## concerning General Powers and Duties, that authorizes the commissionto controlthe quality ofthe state's air; andTHSC, §382.012, 

## concerning StateAir Control Plan, that authorizes the commissionto prepare and develop a general, comprehensive plan for the
proper control ofthe state's air. The amended section is also adoptedunderTHSC, §382.016, 

## concerning Monitoring Requirements; Examination ofRecords, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring ofair contaminantemissions andTHSC, §382.021, 

## concerning Sampling

1

## Methods and Procedures, that authorizesthe commission to prescribe sampling methods. The amended section is also adoptedunder Federal CleanAir Act (FCAA), 42 United States Code (USC), §§7401, 

# etseq., which requires statesto submit state implementation planrevisions that specifythe mannerin which the National Ambient Air Quality Standards will be achieved and maintainedwithin each air quality control region ofthe state.

The amended section implementsTWC, §§5.102, 5.103, and 5.105; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; andFCAA, 42 USC, §§7401 

# etseq.

§117.102o.System 

# Cap.

(a) An 

## owner oroperator ofan electric generating facility (EGF) may achieve compliancewiththe nitrogen oxides (NOx) emission specifications of§117.1010 ofthis title (relatingto Emission Specifications for Attainment Demonstration) byachieving equivalent NOxemission reductions obtainedby compliance with a daily and 30-day system cap emission limitation in accordance with the requirements ofthis section.

(b) 

## Each EGF within an electric power generating system, as defined in §117.10 of this title (relatingto Definitions), thatwould otherwisebe subjectto the NOx emission
rates of§117.1010 ofthis title mustbeincluded inthe system cap.

(c) The system cap mustbe calculated as follows.
2

## (1) A rolling 30-dayaverage emission cap mustbe calculatedusing the following equation.

Figure: 30TAC §117.1020(c)(1) (No change)

N 

# Cap30day 

# =

# L (Ht X

# Rt) i=l


## Where:

Cap3oday 

## = the NOx 30-dayrolling average emission cap in pounds per day; i =each EGF in the electricpower generating system; N =thetotal number ofEGFs in the emission cap; Hi= the average ofthe daily heat inputfor each EGF in the emission cap, in million British

thermal units per day, as certifiedtothe executive director, for the system highest 30- day periodinthe nine months ofJuly, August, and September 1996, 1997, and 1998. For an EGF exemptfrom the 40 Code ofFederal Regulations (CFR) Part 75 monitoring requirements, ifthe heatinputdata correspondingto the system highest 30-dayperiod (as determinedfor an EGF in the system subjectto 40 CFR Part 75 monitoring) is not available, the daily average ofthehighest calendarmonth heatinputin 1996

- 1998 maybeused; and 

## Ri =the emission specification of§117.1010(a) ofthis title.


## (2) Amaximum daily cap mustbe calculatedusing thefollowing equation.

Figure: 30TAC §117.1020(c)(2) (No change)

N 

# Capdaily 

# =

# L (Hmi xRi) i=l


## Where: 3

## Capdaily

# =the NOx maximum daily cap in pounds perday; i 

# =as defined in paragraph (1) 

## ofthis subsection; N 

# =as defined in paragraph (1) 

## ofthis subsection;

Hmi 

# =the maximum daily heatinput, as certifiedto the executive director, allowed orpossible (whichever is lower) in a day; and 

## & 

# =as defined in paragraph (1) 

## ofthis subsection.


## (3) Each EGF inthe system cap is subjecttothe emissionlimits ofboth paragraphs (1) 

## and (2) 

## ofthis subsection at all times.

(d) The NOxemissions monitoring requiredby §117.1040 

## ofthis title (relatingto Continuous Demonstration ofCompliance) for each EGF in the system cap mustbeused
to demonstrate continuous compliance with the system cap.

(e) For each operating EGF, the owner oroperator shall use one ofthefollowing methods to provide substitute emissions compliance data during periodswhen the NOx monitor is off-line:

(1) 

## ifthe NOxmonitor is a continuous emissions monitoring system (CEMS):

(A) subjectto 40 

## Code ofFederal Regulations (CFR) Part 75, use the missing dataprocedures specified in 40 

## CFR Part 75, Subpart D (Missing Data Substitution Procedures); or

4

## (B) subjectto 40 CFR Part75, Appendix E, use the missing data procedures specifiedin 40 CFR Part 75, Appendix E, §2.5 (Missing Data Procedures);

(2) useAppendix E monitoring in accordance with §117.1040(d) ofthis title;

(3) ifthe NOxmonitor is a predictive emissions monitoring system (PEMS):

(A) usethe methods specifiedin40 CFR Part 75, Subpart D; or

(B) use calculations in accordance with §117.8no(b) ofthis title (relatingto Emission Monitoring System Requirements for Utility Electric Generation Sources); or

(4) use the maximumblock one-houremission rate as measuredbythe 30- daytesting.

(f) 

## The owner or operator ofany EGF subjectto a system cap shall maintain daily records indicating the NOxemissions andfuel usage from each EGF and summations of total NOx emissions andfuel usage for all EGFs underthe system cap on a dailybasis. Records must also be retained in accordance with §117.1045 ofthis title (relating to Notification, Recordkeeping, and Reporting Requirements). 5

# (g) The owner or operator ofany EGF subjectto a system cap shall report any exceedance ofthe system cap emissionlimit within 48 hours tothe appropriate regional office. The owner or operator shall thenfollow up within 21 

# days ofthe exceedance with

a written reporttothe regional office thatincludes an analysis ofthe cause for the exceedance with appropriate datato demonstrate the amount ofemissions in excess of the applicable limit andthe necessary corrective actions takenby the company to assure future compliance. Additionally, the owner oroperator shall submit semiannual reports for the monitoring systems in accordance with §117.1045 

# of this title.

(h) The owner or operator ofany EGF subjectto a system cap shall demonstrate initial compliance with the system cap in accordance with the schedule specified in §117.9100 

# ofthistitle (relating to Compliance Schedule for Beaumont-PortArthur Ozone NonattainmentArea Utility Electric Generation Sources).

(i) 

## An 

# EGF thatis permanently retired ordecommissioned andrendered

<' 

# inoperable maybe included inthe system cap emission limit, providedthatthe permanent shutdown occurred afterJanuary 1, 1999. 

# The system cap emission limit is calculated in accordance with subsection (b) 

# ofthis section.


# G) Emission reductions from shutdowns orcurtailments thathave beenusedfor netting oroffset purposes underthe requirements ofChapter 116 

# ofthis title (relating to

6

# Control ofAir Pollutionby Permits for New Construction or Modification) may notbe includedinthebaseline for establishing the cap.

(k) Forthe purposes ofdetermining compliance withthe system cap emission limit, the contribution ofeach affected EGF thatis operating during a startup, shutdown, or emissions event as defined in §101.1 

# ofthis title (relatingto Definitions)
mustbe calculatedfrom the NOx emission rate measuredby the NOx monitor, if operating properly. If

# the NOxmonitor is not operating properly, the substitute data procedures identified in subsection (e) ofthis section mustbeused. If

# neitherthe NOx monitor northe substitute data procedure are operating properly, the owner oroperator shall use the maximum daily rate measured during the initial demonstration of compliance, unless the owner or operatorprovides data demonstrating to the satisfaction ofthe executive director andthe United States Environmental Protection Agency that actual emissions were less than maximum emissions during such periods.

(1) An 

# owner or operator ofa source ofNOxwho is participating inthe system cap underthis section may exceedtheir system cap provided thatthe owner or operator is complying with the requirements of §117.9800 

# ofthis title (relatingto Use ofEmission Credits for Compliance) or Chapter 101, 

# Subchapter H, Division 1 

# or4 ofthis title (relating to Emission Credit Banking andTrading; and Discrete Emission Credit Banking andTrading).

7

# (m) Inthe event that a unitwithin an electricpowergenerating system is sold or transferred, theunit mustbecome subjecttothe transferee's system cap.

8

## SUBCHAPTERC: COMBUSTION CONTROLAT MAJORUTILI1YELECTRIC GENERATION SOURCES IN OZONE NONATTAINMENTAREAS DIVISION 2: 

## DALLAS-FORT WORTH OZONE NONATTAINMENTAREA UTILI1YELECTRIC GENERATION SOURCES §117.1120


## StatutoryAuthority 

## The amended section is adoptedunderTexas Water Code (TWC), §5.102, 

## concerning General Powers, thatprovides the commission with the general powers to carryoutits duties undertheTWC; TWC, §5.103, 

## concerning Rules, that authorizes the commission
to adopt rules necessaryto carry outits powers and duties undertheTWC; TWC, §5.105, 

## concerning General Policy, that authorizesthe commissionby rule to establish and
approve all general policy ofthe commission; andunderTexas Health and Safety Code (THSC), §382.017, 

## concerning Rules, that authorizes the commissionto adoptrules consistentwiththepolicy andpurposes oftheTexas CleanAir Act. The amended section is also adoptedunderTHSC, §382.002, 

## concerning Policy and Purpose, thatestablishes the commission's purpose to safeguardthe state's airresources, consistentwiththe protection ofpublichealth, general welfare, andphysical property; THSC, §382.011, 

## concerning General Powers and Duties, that authorizes the commissionto control the quality ofthe state's air; andTHSC, §382.012, 

## concerning StateAir Control Plan, that authorizes the commissionto prepare and develop a general, comprehensive plan for the
propercontrol ofthe state's air. The amended section is also adoptedunderTHSC, §382.0.16, 

## concerning Monitoring Requirements; Examination ofRecords, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring ofair contaminant emissions andTHSC, §382.021, 

## concerning Sampling

9

## Methods andProcedures, that authorizes the commission to prescribe sampling methods. The amended section is also adopted under Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, 

# etseq., which requires statesto submit state implementationplan revisions that specifythe mannerin which the NationalAmbient Air Quality Standards will be achieved and maintainedwithin each air quality control region ofthe state.

The amended section implementsTWC, §§5.102, 5.103, and 5.105; THSC, §§382.002, 382.011,382.012,382.016,382.017, and 382.021; and FCAA, 42 USC, §§7401 

# etseq.

§117.1120. 

## System Cap.



## (a) An 

## owner oroperatorofan electric generatingfacility (EGF) may achieve compliance with the nitrogen oxides (NOx) emission specifications of§117.1110 ofthis title (relating to Emission Specifications for Attainment Demonstration) by achieving equivalent NOxemission reductions obtainedby compliance with a daily and30-day system cap emissionlimitationin accordance withthe requirements ofthis section.

(b) 

## Each EGF within an electric power generating system, as defined in §117.10 of this title (relatingto Definitions), thatwould otherwisebe subjecttothe NOxemission
rates of§117.1110 ofthis title mustbe includedinthe system cap.

(c) The system cap mustbe calculated as follows.
10

## (1) A rolling 30-dayaverage emission cap mustbe calculatedusingthe following equation.

Figure: 30TAC §117.1120(c)(1) (No change)

Where: N 

# Cap3odo.y = 

# L (Hi x 

# Ri) 1=1



## Cap3

## oday = the NOx 30-dayrolling average emission cap in pounds per day; i =each EGF in the electric power generating system; N = the total number ofEGFs in the emission cap; Hi = the average ofthe daily heat inputfor each EGF inthe emission cap, in million British thermal units perday, as certified to the executive director, for the system highest 30- day periodinthe nine months ofJuly, August, and September 1996, 1997, and 1998. For an EGF exempt from the 40 Code ofFederal Regulations (CFR) Part 75 monitoring requirements, ifthe heat input data corresponding to the system highest 30-dayperiod (as determinedfor an EGF in the system subjectto 40 CFR Part 75 monitoring) is not available, the daily average ofthe highest calendar month heat inputin 1996- 1998 maybeused; and Ri =the emission specification of§117.1110(a) ofthis title. 

## (2) A maximum daily cap mustbe calculatedusing thefollowing equation.

Figure: 30TAC §117.1120(c)(2) (No change)

N 

# Capdaily = 

# L(Hmi xRi) i=l 

## Where: Capdany = the NOx maximum daily cap in pounds per day; 11

## i = as defined in paragraph (1) 

## ofthis subsection; N = as defined inparagraph (1) 

## ofthis subsection;

Hmi 

## =the maximum daily heat input, as certifiedtothe executive director, allowed orpossible (whichever is lower) in a day; and Ri 

## = as defined in paragraph (.1) 

## ofthis subsection. 

## (3) Each EGF inthe system cap is subjecttothe emissionlimits ofboth paragraphs (1) 

## and (2) 

## ofthis subsection at all times.

(d) The NOxemissions monitoring requiredby §117.1140 

## ofthis title (relatingto Continuous Demonstration ofCompliance) for each EGF inthe system cap mustbe used
to demonstrate continuous compliance with the system cap.

(e) For each operating EGF, the owner oroperator shall use one ofthefollowing methods to provide substitute emissions compliance data during periods whenthe NOx monitor is off-line:

(1) 

## ifthe NOxmonitor is a continuous emissions monitoring system (CEMS):

(A) subjectto 40 

## Code ofFederal Regulations (CFR) Part 75, use the missing dataprocedures specified in 40 

## CFR Part 75, Subpart D (Missing Data Substitution Procedures); or

12

## (B) subjectto 40 CFR Part 75, Appendix E, use the missing data procedures specifiedin40 CFR Part75, Appendix E, §2.5 (Missing Data Procedures);

(2) useAppendix E monitoring in accordance with §117.1140(d) ofthis title;

(3) ifthe NOx monitor is a predictive emissions monitoring system (PEMS):

(A) use the methods specifiedin40 CFR Part 75, Subpart D; or

(B) use calculations in accordance with §117.811o(b) ofthistitle (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or

(4) ifthe methods specified inparagraphs (1)

- 

## (3) ofthis subsection are
notused, the owner or operator shall use the maximumblock one-hour emission rate as measuredbythe 30-daytesting.

(f) 

## The owner or operator ofany EGF subjectto a system cap shall maintain daily records indicatingthe NOxemissions andfuel usage from each EGF and summations of total NOxemissions andfuel usage for all EGFs underthe system cap on a dailybasis.

13

## Records must alsobe retained in accordance with §117.1145 

## ofthis title (relatingto Notification, Recordkeeping, and Reporting Requirements).

(g) The owner or operator ofany EGF subjectto a system cap shall report any exceedance ofthe system cap emissionlimit within 48 hours to the appropriate regional office. The owner or operator shallthen follow up within 21 

## days ofthe exceedance with

a written reportto the regional office that includes an analysis ofthe cause for the exceedance with appropriate datato demonstrate the amount ofemissions in excess of the applicable limit andthe necessarycorrective actions takenbythe companyto assure future compliance. Additionally, the owner or operator shall submit semiannual reports for the monitoring systems in accordance with §117.1145 

## ofthistitle.

(h) The owner or operator ofany EGF subjectto a system cap shall demonstrate initial compliance with the system cap in accordance withthe schedule specifiedin §117.9110 

## ofthis title (relatingto Compliance Schedule for Dallas-FortWorth Ozone NonattainmentArea Utility Electric Generation Sources).

(i) 

## An 

## EGF that is permanentlyretired or decommissioned andrendered inoperable maybe included inthe system cap emission limit, providedthatthe permanent shutdown occurred afterJanuary 1, 1999. The system cap emission limitis calculated in accordance with subsection (b) 

## ofthis section.

14

# G) Emission reductions from shutdowns or curtailments thathave been usedfor netting oroffset purposes underthe requirements ofChapter 116 

# ofthis title (relatingto Control ofAir Pollutionby Permits for New Construction or Modification) may notbe included in thebaseline for establishingthe cap.

(k) Forthe purposes ofdetermining compliance withthe system cap emission limit, the contribution ofeach affected EGF thatis operating during a startup, shutdown, or emissions event as defined in §101.1 

# ofthis title (relating to Definitions)
mustbe calculatedfrom the NOx emission rate measuredbythe NOxmonitor, if operating properly. If

# the NOxmonitor is not operating properly, the substitute data procedures identifiedin subsection (e) ofthis section mustbe used. If

# neitherthe NOx monitor northe substitute data procedure are operating properly, the owner or operator shall use the maximum daily rate measured duringtheinitial demonstration of compliance, unless the owner or operatorprovides data demonstratingtothe satisfaction ofthe executive director andthe United States Environmental Protection Agency that actual emissions were less than maximum emissions during suchperiods.



# 0) An 

# owner or operator ofa source ofNOxwho is participating inthe system cap underthis section may exceed their system cap providedthatthe owner or operator is complying with the requirements of§117.9800 

# ofthis title (relating to Use ofEmission Credits for Compliance) or Chapter 101, 

# Subchapter H, Division 1 

# or4 of this title (relating to Emission Credit Banking andTrading; and Discrete Emission Credit Banking andTrading). 15

# (m) Inthe eventthat a unitwithin an electricpower generating system is sold or transferred, the unit mustbecome subjecttothetransferee's system cap. The value Ri

# in this section is based ontheunit's status as partofa large or small system as ofJanuary
1, 2000, 

# and does not change as a result ofsale ortransfer ofthe unit, regardless ofthe size ofthetransferee's system.

16

## SUBCHAPTERC: COMBUSTION CONTROLAT MAJORUTILITY ELECTRIC GENERATION SOURCES IN OZONE NONATTAINMENTAREAS DIVISION 3: HOUSTON-GALVESTON-BRAZORIA OZONE NONATTAINMENTAREAUTILITY ELECTRIC GENERATION SOURCES §117.1220 

## StatutoryAuthority The amended section is adoptedunderTexas Water Code (TWC), §5.102, 

## concerning General Powers, thatprovides the commissionwith the general powers to carry outits duties underthe TWC; TWC, §5.103, 

## concerning Rules, that authorizes the commission
to adopt rules necessaryto carry outits powers and duties underthe TWC; TWC, §5.105, 

## concerning General Policy, that authorizes the commissionby rule to establish and
approve all general policy ofthe commission; andunderTexas Health and Safety Code (THSC), §382.017, 

## concerning Rules, that authorizes the commission to adopt rules consistentwiththe policy andpurposes ofthe Texas Clean Air Act. The amended section is also adoptedunderTHSC, §382.002, 

## concerning Policy and Purpose, thatestablishes the commission's purpose to safeguardthe state's airresources, consistentwith the protection ofpublichealth, general welfare, andphysical property; THSC, §382.011, 

## concerning General Powers and Duties, that authorizes the commission to control the quality ofthe state's air; andTHSC, §382.012, 

## concerning StateAir Control Plan, that authorizes the commission toprepare and develop a general, comprehensive plan for the
proper control ofthe state's air. The amended section is also adoptedunderTHSC, §382.016, 

## concerning Monitoring Requirements; Examination ofRecords, that authorizes the commission toprescribe reasonable requirements for the measuring and monitoring ofair contaminantemissions andTHSC, §382.021, 

## concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling 17

## methods. The amended section is also adoptedunder Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, 

# etseq., which requires states to submit state implementationplan revisions that specifythe mannerin which the National Ambient Air Quality Standards will be achieved and maintainedwithin each air quality control region ofthe state.

The amended section implements TWC, §§5.102, 5.103, and5.105; THSC, §§382.002, 382.011,382.012,382.016,382.017, and 382.021; and FCAA, 42 USC, §§7401 

# etseq.

§117.1220. 

## System Cap



## (a) An 

## owner or operator ofan electric generating facility (EGF) shall comply with a daily and 30-day system cap nitrogen oxides (NOx) emissionlimitation in accordance withthe requirements ofthis section.

(b) 

## Each EGF within an electricpowergenerating system, as defined in §117.10 of this title (relatingto Definitions), thatis subjectto §117.1210(a) ofthis title (relatingto Emission Specifications for Attainment Demonstration) mustbe included inthe system
cap.

(c) The system cap mustbe calculated as follows.

18

## (1) A rolling 30-dayaverage emission cap mustbe calculatedusingthe following equation.

Figure: 30TAC §117.1220(c)(1) (No Change)

.LV 

# Cap30daJ! 

# =

# L(Ht x 

# Rt) i=l 

## Where:

Cap3oday 

## = the NOx 30-dayrolling average emission cap in pounds perday; i =each EGF in the electric power generating system; N = the total number ofEGFs inthe emission cap; Hi 

## = (A) 

## the average ofthe daily heatinputfor each EGF in the emission cap, in million British thermal units per day, as certifiedto the executive director, for any system 30-dayperiod inthe nine months ofJuly, August, and September 1997, 1998, and 1999; (B) for an EGF exempt from the 40 Code ofFederal Regulations (CFR) Part 75

monitoring requirements, ifthe heatinputdata corresponding to any system 30-day period (as determinedfor an EGF in the system subjectto 40 CFR Part 75 monitoring) is not available, the daily average ofthe highest calendar month heat inputin 1997- 1999 maybeused; (C) the level ofactivity authorizedbythe executive director for the third quarter (July,

August, and September), until such time two consecutive third quarters ofactual level ofactivity data are available, mustbe usedfor the following: (i) 

## an EGF thatthe owner or operatorhas submitted, under Chapter 116 

## ofthis title

(relating to Control ofAir PollutionbyPermits for New Construction or Modification), an application determined to be administratively complete by the executive directorbefore January 2, 2001; (ii) 

## an EGF that qualifies for a permitbyrule under Chapter 106 

## ofthis title

(relating to Permits by Rule) andhas commenced constructionbefore January 2, 2001; and (iii) an EGF thatwas not in operationbefore January 1, 1997; (D) after two consecutive third quarters ofactual level ofactivity data are available for

an EGF described in subsection (c)(1) ofthis section, variable (C) ofthis figure, the owner or operator may calculate thebaseline as the average ofanytwo consecutive

. 19

## third quarters inthe first five years ofoperation. Thefive-year periodbegins atthe end ofthe adjustmentperiod as defined in §101.350 ofthis title (relating to Definitions); and (E) in extenuating circumstances, the owner or operator ofan EGF mayrequest, subject

to approval ofthe executive director, up to two additional calendaryears to establish thebaselineperiod describedin subsection (c)(1) ofthis section, variables (A)- (D) ofthis figure. Applications seeking an alternate baseline period mustbe submittedbythe owner or operator ofthe EGF to the executive director: (i) 

## no laterthan December 31, 2001; or (ii) for an EGF thatthebaseline period as described in subsection (c)(1) ofthis

section, variables (A)- (D) ofthis figure is not completebyDecember 31, 2001, no laterthan 90 

## days after completion ofthe baseline period; and 

## Ri =the emission specification of §117.1210(a) ofthistitle.



## (2) A maximum daily cap mustbe calculatedusingthe following equation.

Figure: 30 TAC §117.1220(c)(2) (No Change)

Where: N 

## Capdatly 

# =L(Hmt xRt) i=1



## Capdaily = the NOx maximum daily cap in pounds per day; i = as defined in paragraph (1) ofthis subsection; N = as defined in paragraph (1) ofthis subsection;

Hmi 

## =the maximum daily heat input, as certifiedto the executive director, allowed orpossible (whichever is lower) in a day; and 

## Ri = as defined in paragraph (1) ofthis subsection. 

## (3) Each EGF in the system cap is subjectto the emissionlimits ofboth paragraphs (1) 

## and (2) ofthis subsection at all times.

20

## (d) The NOxemissions monitoring requiredby §117.1240 ofthistitle (relating to Continuous Demonstration ofCompliance) for each EGF inthe system cap mustbeused
to demonstrate continuous compliance with the system cap.

(e) For each operating EGF, the owner oroperator shall use one ofthe following methods to provide substitute emissions compliance data during periods when the NOx monitor is off-line:

(1) ifthe NOxmonitor is a continuous emissions monitoring system (CEMS):

(A) subjectto 40 Code ofFederal Regulations (CFR) Part 75, use the missing dataprocedures specified in 40 CFR Part 75, Subpart D (Missing Data Substitution Procedures); or

(B) subjectto 40 CFR Part75, Appendix E, use the missing data procedures specified in40 CFR Part 75, Appendix E, §2.5 (Missing Data Procedures);

(2) use 40 CFR Part 75, Appendix E monitoring in accordance with §117.1240(e) ofthis title;

(3) ifthe NOxmonitor is a predictive emissions monitoring system (PEMS):
21

## (A) use the methods specifiedin40 CFR Part 75, Subpart D; or

(B) use calculations in accordance with §117.811o(b) ofthis title (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or

(4) ifthe methods specified in paragraphs (1)- (3) ofthis subsection are
notused, the owner oroperator shall use the maximumblock one-hour emission rate as measuredbythe 30-daytesting.

(f) 

## The owner or operator shall maintain dailyrecords indicating the NOx emissions andfuel usage from each EGF and summations oftotal NOxemissions and fuel usage for all EGFs underthe system cap on a dailybasis. Records must also be retainedin accordance with §117.1245 ofthis title (relatingto Notification, Recordkeeping, and Reporting Requirements).

(g) The owner or operator shall report any exceedance ofthe system cap emission limitwithin 48 hours tothe appropriate regional office. The owner oroperator shall then follow up within 21 days ofthe exceedance with a written reportto the regional office thatincludes an analysis ofthe cause for the exceedance with appropriate datato demonstrate the amount ofemissions in excess ofthe applicable limit andthe necessary corrective actions takenbythe companyto assure future compliance. Additionally, the 22

## owner oroperator shall submit semiannual reports for the monitoring systems in accordance with §117.1245 

## ofthis title.

(h) The owner or operator shall demonstrateinitial compliance with the system
cap in accordance withthe schedule specifiedin §117.9120 

## ofthis title (relating to Compliance Schedule for Houston-Galveston-Brazoria Ozone NonattainmentArea Utility Electric Generation Sources).

(i) An 

## EGF thatis permanentlyretired or decommissioned andrendered inoperable maybe includedinthe system cap emission limit, providedthatthe permanent shutdown occurred after January 1, 2000. 

## The system cap emissionlimit is calculatedin accordance with subsection (b) 

## ofthis section.


# G) Emission reductions from shutdowns or curtailmentsthathave beenusedfor netting oroffset purposes underthe requirements ofChapter 116 

## ofthis title (relating to Control ofAir Pollution by Permits for New Construction or Modification) may notbe includedinthebaseline for establishingthe cap.

(k) For thepurposes ofdetermining compliance withthe system cap emission limit, the contribution ofeach affected EGF thatis operating during a startup, shutdown, oremissions event as defined in §101.1 

## ofthis title (relating to Definitions)
mustbe calculatedfrom the NOx emission rate measuredbythe NOxmonitor, if operating properly. 

# Ifthe NOxmonitor is not operating properly, the substitute data 23

# procedures identified in subsection (e) ofthis section mustbe used. If

# neitherthe NOx monitor northe substitute data procedure are operating properly, the owner oroperator shall use the maximum daily rate measured duringthe initial demonstration of compliance, unless the owner oroperatorprovides data demonstratingtothe satisfaction ofthe executive director andthe United States Environmental Protection Agency that actual emissions were less than maximum emissions during such periods.

(1) An 

# owner oroperator ofa source ofNOx who is participating inthe system cap underthis section may exceedtheir system cap providedthatthe owner or operatoris complying withthe requirements of §117.9800 

# ofthis title (relating to Use ofEmission Credits for Compliance) orChapter 101, 

# Subchapter H, Division 1 

# or4 ofthis title (relatingto Emission Credit Banking andTrading; and Discrete Emission Credit Banking andTrading).

(m) Inthe eventthat a unitwithin an electric power generating system is sold or transferred, the unitmustbecome subjectto the transferee's system cap.

24

## SUBCHAPTERE: MULTI-REGION COMBUSTION CONTROL DIVISION 1: 

## UTILITY ELECTRIC GENERATION IN EASTAND CENTRAL TEXAS §117.3020 

## StatutoryAuthority 

## The amended section is adoptedunderTexas Water Code (TWC), §5.102, 

## concerning General Powers, thatprovides the commissionwiththe general powers to carryoutits duties undertheTWC; TWC, §5.103, 

## concerning Rules, that authorizes the commission
to adopt rules necessaryto carry outits powers and duties undertheTWC; TWC, §5.105, 

## concerning General Policy, that authorizes the commissionby rule to establish and
approve all general policy ofthe commission; andunderTexas Health and Safety Code (THSC), §382.017, 

## concerning Rules, that authorizes the commission to adopt rules consistentwith thepolicy andpurposes oftheTexas CleanAir Act. The amended section is also adoptedunderTHSC, §382.002, 

## concerning Policy and Purpose, that establishes the commission's purpose to safeguardthe state's air resources, consistent withthe protection ofpublichealth, general welfare, andphysical property; THSC, §382.011, 

## concerning General Powers and Duties, that authorizes the commissionto control the quality ofthe state's air; andTHSC, §382.012, 

## concerning StateAir Control Plan, that authorizes the commission to prepare and develop a general, comprehensive planfor the
proper control ofthe state's air. The amended section is also adoptedunderTHSC, §382.016, 

## concerning Monitoring Requirements; Examination ofRecords, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring ofair contaminantemissions andTHSC, §382.021, 

## concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling
25

## methods. The amended section is also adopted under Federal CleanAirAct (FCAA), 42 United States Code (USC), §§7401, 

# etseq., which requires statesto submit state implementationplan revisions that specifythe mannerinwhichthe National Ambient Air Quality Standards will be achieved and maintainedwithin each air quality control region ofthe state.

The amended section implementsTWC, §§5.102, 5.103, and5.105; THSC, §§382.002, 382.011,382.012,382.016,382.017, and 382.021; andFCAA, 42 USC, §§7401 

# etseq.

§117.3020. 

## System Cap.
(a) An 

## owner or operator may achieve compliance withthe nitrogen oxides (NOx) emission specifications of§117.3010 ofthis title (relating to Emission Specifications) by achieving equivalent NOxemission reductions obtainedbycompliance with a system cap emissionlimitation in accordance with the requirements ofthis section.

(b) 

## Each unitwithin an electric power generating system, as defined in §117.10 of this title (relatingto Definitions), that would otherwisebe subjectto the NOx emission specifications of §117.3010 ofthis title mustbeincludedinthe system cap.

(c) The annual average emission cap mustbecalculatedusing thefollowing equation.
Figure: 30 TAC §117.3020(c) (No change)

# Capa:nnll11l



## Where:

Capannual 

# =the NOx annual average emission cap in tons peryear; i 

# =each unitinthe electric power generating system; N 

# =the total number ofunits inthe emission cap; Hi 

# =the average ofthe annual heat inputfor each unitinthe emission cap, in million British

thermal units peryear, as certifiedto the executive director, for 1996, 1997, and 1998; and Ri 

# =the emission specification of §117.3010 

## ofthis title. 

## (d) The NOxemissions monitoring requiredby §117.3040 

## ofthis title (relating to Continuous Demonstration ofCompliance) for each unitinthe system cap mustbeused
to demonstrate continuous compliance with the system cap.

(e) For each operating unit, the owner or operator shall use one ofthefollowing methods to provide substitute emissions compliance data during periods when the NOx monitor is off-line:

(1) 

## ifthe NOxmonitoris a continuous emissions monitoring system (CEMS): (A) subjectto 40 

## Code ofFederal Regulations (CFR) Part 75, use the missing dataprocedures specifiedin 40 

## CFR Part 75, Subpart D (Missing Data Substitution Procedures); or

27

## (B) subjectto 40 CFR Part75, Appendix E, use the missing data procedures specified in40 CFR Part 75, Appendix E, §2.5 (Missing Data Procedures);

(2) use Appendix E monitoring in accordance with §117.3040(e) ofthis title;

(3) ifthe NOxmonitoris a predictive emissions monitoring system (PEMS):

(A) usethe methods specified in 40 CFR Part 75, Subpart D; or

(B) use calculations in accordance with §117.8no(b) ofthis title (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or

(4) use the maximum emission rate as measuredby the testing conducted in accordance with §117.3035(d) ofthis title (relating to Initial Demonstration of Compliance).

(f) 

## The owner or operator ofany unit subjectto a system cap shall maintain daily records indicatingthe NOx emissions andfuel usage from each unit and summations of total NOx emissions andfuel usage for all units underthe system cap on a dailybasis.

28

# Records must also be retainedin accordance with §117.3045 

# ofthis title (relating to Notification, Recordkeeping, and Reporting Requirements).

(g) The owner or operator ofany unit subjectto a system cap shall submit annual reports for the monitoring systems in accordance with §117.3045 

# ofthis title. The owner

oroperator shall also report any exceedance ofthe system cap emissionlimit in the annual report and shall include an analysis ofthe cause for the exceedance with appropriate datato demonstrate the amount ofemissions in excess ofthe applicable limit andthe necessary corrective actions takenbythe companyto assure future compliance.

(h) The owner or operator ofany unit subjectto a system cap shall demonstrate initial compliance with the system cap in accordance with the schedule specified in §117.9300 

# ofthis title (relatingto Compliance Schedule for Utility Electric Generation in East and Central Texas).

(i) 

# Aunitthatis permanentlyretired or decommissioned andrendered inoperable maybe included inthe system cap emissionlimit, providedthatthe permanent shutdown occurred on or after January 1, 1999. 

# The system cap emission limitis calculatedin accordance with subsection (b) 

# ofthis section.


# G) Emission reductions from shutdowns or curtailments thathave been used for netting or offset purposes underthe requirements ofChapter 116 

# ofthis title (relating to 29

## Control ofAir PollutionbyPermits for New Construction or Modification) may notbe includedin thebaseline for establishing the cap.

(k) Forthepurposes ofdetermining compliancewith the system cap emission limit, the contribution ofeach affected unitthatis operating during a startup, shutdown,

oremissions event as defined in §101.1 ofthistitle (relatingto Definitions) mustbe calculatedfrom the NOx emission rate measuredbythe NOxmonitor, ifoperating properly. If

## the NOxmonitor is not operating properly, the substitute dataprocedures identifiedin subsection (e) ofthis section mustbeused. If

## neitherthe NOx monitor nor the substitute dataprocedure are operating properly, the owner or operator shall use the maximum daily rate measured during the initial demonstration ofcompliance, unless the owner or operatorprovides data demonstratingtothe satisfaction ofthe executive director andUnited States Environmental ProtectionAgency that actual emissions were less than maximum emissions during such periods.

(1) An 

## owner or operator ofa source ofNOxin any ofthe eastandcentral Texas attainment counties listed in §117.3000(a)(4) ofthis title (relatingtoApplicability) who is participating inthe system cap underthis section (relatingto System Cap) may exceed their system cap providedthatthe owner or operatoris complying with the requirements ofChapter 101, Subchapter H, Division 1or4 ofthis title (relatingto Emission Credit Banking andTrading; and Discrete Emission Credit Banking and Trading).

30

## SUBCHAYfERH: ADMINISTRATIVE PROVISIONS DIVISION 2: 

## COMPLIANCE FLEXIBILI1Y §117.9800 

## StatutoryAuthority The amended section is adopted underTexas Water Code (TWC), §5.102, 

## concerning General Powers, thatprovides the commissionwith the general powers to carry outits duties undertheTWC; TWC, §5.103, 

## concerning Rules, that authorizes the commission
·to adoptrules necessary to carry outits powers and duties underthe TWC; TWC, §5.105, 

## concerning General Policy, that authorizes the commissionby rule to establish and
approve all general policy ofthe commission; andunderTexas Health and Safety Code (THSC), §382.017, 

## concerning Rules, that authorizes the commission to adoptrules consistentwiththe policy andpurposes oftheTexas Clean Air Act. The amended section is also adoptedunderTHSC, §382.002, 

## concerning Policy and Purpose, thatestablishes the commission's purposeto safeguardthe state's air resources, consistentwiththe protection ofpublic health, general welfare, andphysical property; THSC, §382.011, 

## concerning General Powers and Duties, that authorizes the commission to control the quality ofthe state's air; andTHSC, §382.012, 

## concerning StateAir Control Plan, that authorizes the commissionto prepare and develop a general, comprehensive planfor the
propercontrol ofthe state's air. The amended section is also adoptedunderTHSC, §382.016, 

## concerning Monitoring Requirements; Examination ofRecords, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring ofair contaminant emissions andTHSC, §382.021, 

## concerning Sampling Methods and Procedures, that authorizes the commissiontoprescribe sampling methods. The amended section is also adoptedunderFederal Clean Air Act (FCAA), 

## 42 31

## United States Code (USC), §§7401, 

# etseq., which requires states to submit state implementationplan revisions that specifythe mannerin which the National Ambient Air Quality Standards will be achieved andmaintainedwithin each air quality control region ofthe state.

The amended section implements TWC, §§5.102, 5.103, 

## and 5.105; 

## THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, 

## and 382.021; 

## andFCAA, 42 

## USC, §§7401 

# etseq.

§117.9800. Use ofEmission Creditsfor Compliance.·



## (a) An 

## owner or operator ofa unit not subjectto Chapter 101, 

## Subchapter H, Division 3 ofthis title (relating to Mass Emissions Cap andTrade Program) may meet emission control requirements ofthe sections specified inparagraphs (1)

- 

## (8) ofthis subsection, in whole orinpart, byobtaining an emission reduction credit (ERC), mobile emission reduction credit (MERC), discrete emission reduction credit (DERC), or mobile discrete emission reduction credit (MDERC) in accordance with Chapter 101, 

## Subchapter H, Division 1 

## or4 ofthis title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking andTrading), unless there are federal or
state regulations orpermitsunderthe same commission account numberthat contain a condition or conditions precluding such use:

32

## (1) §§117.105, 117.205, 117.305, 117.1005, 117.1105, 

## or 117.1205 

## ofthis title (relatingto Emission Specifications for ReasonablyAvailable Control Technology (RACT));

(2) §§117.110, 117.210, 117.1010, 

## or 117.1110 

## ofthis title (relatingto Emission Specifications for Attainment Demonstration);

(3) §§117.1015, 117.1115, 

## or 117.1215 

## ofthis title (relating toAlternative System-Wide Emission Specifications);

(4) §§117.115, 117.215, 

## or 117.315 

## ofthis title (relating toAlternative PlantWide Emission Specifications);

(5) §§117.123, 117.223, 117.323, 117-423, 

## or §117.3120 

## ofthis title (relating
to Source Cap);

(6) §§117.2010, 117.3010, 

## or 117.3110 

## ofthis title (relating to Emission Specifications);

(7) §§117-410, 117.1310, 117.2110, 

## or 117.3310 

## ofthistitle (relating to Emission Specifications for Eight-HourAttainment Demonstration); or

33

## (8) §117.3123 

## ofthis title (relatingto Dallas-FortWorth Eight-Hour Ozone Attainment Demonstration Control Requirements).

(b) 

## An owner or operator ofa unit subjectto §§117.320, 117.1020, 117.1120, 117.1220, 

## or 117.3020 

## ofthis title (relating to System Cap) may meetthe emission control requirements ofthese sections inwhole orin part, by complying withthe requirements ofChapter 101, 

## Subchapter H, Division 1

## or4ofthis title, by obtaining an ERC, MERC, DERC, or MDERC, unlessthere arefederal or state regulations orpermits underthe same commission account numberthat contain a condition orconditions precluding such use.

(c) Forthepurposes ofthis section, theterm "reduction credit (RC)" refers to an ERC, MERC, DERC, or MDERC, whichever is applicable.

(d) Any lower nitrogen oxides (NOx) emission specification established underthis chapterfor the unitorunits using RCs requires the user ofthe RCs to obtain additional RCs in accordance with Chapter 101, 

## Subchapter H, Division 1

## or4 ofthis title and/or otherwise reduce emissions priortothe effective date ofsuchrule change. For units using RCs in accordance with this section that are subjectto new, more stringent rule limitations, the owner or operatorusing the RCs shall submit a revised final control plan
to the executive director in accordance with §§117.156, 117.256, 117.356, 117-456, 117.1056, 117.1156, 117.1256, 

## and 117.1356 

## ofthis title (relatingto Revision ofFinal Control Plan) to revise thebasis for compliance with the emission specifications ofthis 34

## chapter. The owner oroperatorusing the RCs shall submitthe revised final control plan

as soon as practicable, but nolaterthan 90 days priortothe effective date ofthe new,

more stringent rule. The owner or operator oftheunit(s) currentlyusing RCs shall calculate the necessary emission reductions perunit as follows.
Figure: 30TAC §117.98oo(d) (No change)



# M'

# = r.

# LA X 

# (ERold

- ERnew) X 

# d ]· 

# L 2ooo

Where:**~E** 

# =the differential ofemissions;

LA 

# =the maximum level ofactivity; 

## ERo1d 

# =the existing NOx emission rate for the affected unitin pounds perunit ofactivity; 

## ERnew 

# =the new NOx emission rate for the affected unitin pounds perunit ofactivity; and d 

# =(A) to calculate annual emission reductions, d 

# =365; and

(B) to calculate emission reductions for the remainder ofa control period, d 

# =the number

ofdays remaining inthe control period.

35registration that is up to 90 days late and a $60 fee for renewal that is later than 90 days. The Board amended the rule as reposed to delete an obsolete fee charged for a temporary prog am for exempting certain engineers from the Architectural Pra tice Act. The program existed for four months and has expired The Board received public comm nt opposing the proposed rule amendment. COMMENT: The levying of ad itional fees to register firms amounts to an additional tax tha is unneeded and unwarranted by a state agency that has c nsistently maintained budget surpluses over the years. AGENCY RESPONSE: The ann I registration fee is forthe purpose of covering the cost of auto ating and maintaining the automation ofthe business registra on process. The current manner of maintaining firm registratio records is not efficient and not conducive to providing public noti e aboutthe registration status of firms. The annual fee is inten ed to provide revenue for that purpose. The amendments are adopted pu uantto §1051.202, Texas Occupations Code, which provides t e Texas Board ofArchitectural Examiners with authority to prom gate rules to implement Chapter 1051, Texas Occupations C e. The rule is also adopted pursuant to §§1051.651, 1052.05 , and 1053.052, Texas Occupations Code, which grant to the board the authority to assess fees in an amount reasonable an necessary to cover administrative costs. 

### §7.10. General Fees. (a) FAILURE TO TIMEL PAY A REGISTRATION RENEWAL WILL RESULT IN THE TOMATIC CANCELLATION OF REGISTRATION BY OPERATI N OF LAW. (b) The following fees shall pply to services provided by the Board in addition to any fee establi hed elsewhere by the rules and regulations ofthe Board or by Texas law: Figure: 22 TAC §7.10(b) (c) The Board cannot accept ash as payment for any fee. (d) An official postmark fro the U.S. Postal Service or other delivery service receipt may be prese ted to the Board to demonstrate the timely payment ofany fee. (e) Ifa check is submitted t the Board to pay a fee and the bank upon which the check is drawn refuses to pay the check due to insufficient funds, errors in touring, r bank account number, the fee shall be considered unpaid and any a licable late fees or other penalties accrue. The Board shall impose a rocessing fee for any check that is returned unpaid by the bank upon hich the check is drawn. (f) A Registrant who is in ood Standing or was in Good Standing at the time the Registrant e tered into military service shall be exempt from the payment of any ee during any period of active duty service in the U.S. military. The xemption under this subsection shall continue through the remainder ofthe fiscal year during which the Registrant's active duty status exp res. This agency hereby certifies thatth adoption has been reviewed by legal counsel and found to be a alid exercise ofthe agency's legal authority. Filed with the Office ofthe Secreta ofState on March 28, 2012. TRD-201201633 Cathy L. Hendricks, RID, ASID/11 Executive Director Texas Board ofArchitectural Exa Effective date: April17, 2012 Proposal publication date: Decem er 30, 2011 For further information, please call (512) 305-9040 

# • • 

# • TITLE 30. ENVIRONMENTAL QUALITY 

# PART 1. TEXAS COMMISSION ON ENVIRONMENTAL QUALITY CHAPTER 101. GENERAL AIR QUALITY RULES SUBCHAPTER H. EMISSIONS BANKING AND TRADING DIVISION 5. SYSTEM CAP TRADING 30 TAC §§101.380, 101.382, 101.383, 101.385 The Texas Commission on Environmental Quality (commission) adopts the repeal of §§1 01.380, 101.382, 101.383, and 101.385 without changesto the proposed text as published in the October 21, 2011, issue ofthe Texas Register(36 TexReg 7124). Background and Summary ofthe Factual Basis for the Adopted Rules On March 21, 2001, the commission adopted rules establishing the requirements for the System Cap Trading (SCT) program in Chapter 101, Subchapter H, Division 5, §§101.380, 101.382, 101.383, and 101.385. The SCT program was established to provide the owners or operators of affected electric generating facilities (EGF) with an additional compliance option to meet the system cap emission limits specified in 30 Texas Administrative Code (TAC) Chapter 117, Control of Air Pollution from Nitrogen Compounds. The EGFs affected by the Chapter 117 system cap emission limits are located in the Beaumont-Port Arthur 1997 eight-hour ozone maintenance area, consisting of Hardin, Jefferson, and Orange Counties (BPA area); the Houston-Galveston-Brazoria 1997 eight-hour ozone nonattainment area, consisting of Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties (HGB area); and in the East and Central Texas counties of Atascosa, Bastrop, Bexar, Brazos, Calhoun, Cherokee, Fannin, Fayette, Freestone, Goliad, Gregg, Grimes, Harrison, Henderson, Hood, Hunt, Lamar, Limestone, Marion, Mclennan, Milam, Morris, Nueces, Parker, Red River, Robertson, Rusk, Titus, Travis, Victoria, and Wharton. The system cap emission limits in Chapter 117 set daily, 30-day rolling average, or annual emission caps on total nitrogen oxides (NOx) emissions from EGFs that are: subject to the Chapter 117 emission specifications for attainment demonstration (ESAD); under common ownership or control; and grouped together in an electric power generating system, as defined in §117.10(14). For example, ifcompany A has three sites, X, Y, and Z with three, four, and five EGFs, respectively, that are subject to the Chapter 117 ESADs and are part ofan electric power generating system, Chapter 117 sets a daily, 30-day rolling average, or annual emission caps on the total emissions from the 12 affected EGFs. The SCT program provides additional compliance flexibility to own

## ADOPTEDRULES April13, 2012 37 TexReg 2639ers of EGFs operating under a system cap to exceed the system cap at discrete periods of time by purchasing surplus emission allowables, which were generated during the same time period, from other owners of EGFs also operating under a system cap. Surplus emission allowables are calculated as the difference between the amount ofemissions in a Chapter 117 system cap emission limit and the actual emissions from that electric power generating system. Trading of surplus emissions allowabies is allowed only between owners or operators of electric power generating systems that have the same type of Chapter 117 system cap emission limit (i.e., daily, 30-day rolling average, or annual emission caps) and are within the same nonattainment area. Owners or operators of EGFs located in the East and Central Texas counties can only trade surplus emissions allowables with other owners or operators of EGFs located in these counties. The SCT program has seen minimal participation with most reports submitted for compliance purposes showing no trades. In cases where trading was reported, the purchased surplus emission allowables were not used to meet the system cap emission limit(s). In addition, owners or operators of affected EGFs have alternative compliance options to meet the Chapter 117 system cap emission limits. In the BPA and HGB areas, alternative compliance options are available via the Emission Credit Banking and Trading and Discrete Emission Credit Banking and Trading (DERC) programs. In the counties of East and Central Texas, alternative compliance options are available via the DERC program. The Chapter 101 SCT program rules were submitted to the United States Environmental Protection Agency (EPA) as revisions to the state implementation plan (SIP) on May 1, 2001. Sections 101.383 and 101.385 were amended On July 25, 2007, to accurately reference the renumbered Chapter 117 sections related to the system cap emission limits. These amendments were submitted to the EPA as a revision to the SIP on August 16, 2007. The EPA sent a letter, dated October 25, 2010, to the commission requesting revisions to the Chapter 101 SCT program rules. In the letter, the EPA stated its intent to conditionally approve the Chapter 101 SCT program rules if the commission agreed to commit to a rulemaking action to implement the EPA's requested revisions within a one-year time frame. The EPA required a verbal commitment by November 1, 2010, followed by a signed letter from the executive director by November 15, 2010. On November 2, 2010, the executive director responded to the EPA's request stating that due to the minimal participation in the SCT program and the limited timeline to implement the revisions requested by the EPA, the commission would not be able to commit to any rulemaking action. The letter also stated the executive director's intention to seek approval from the commission to withdraw the Chapter 101 SCT program rules from the EPA's consideration as a revision to the SIP. The EPA published its proposed disapproval of the Chapter 101 SCT program rules in the November 18, 2010, issue of the Federal Register (75 FR 70654). On February 23, 2011, the commission approved the withdrawal ofthe Chapter 101 SCT program rules from consideration by the EPA as a revision to the SIP. The EPA was notified ofthis withdrawal in a letter dated March 4, 2011. The EPA acknowledged the withdrawal ofthe Chapter 101 SCT program rules from consideration as a SIP revision in a letter received by the commission on April 4, 2011, and published its withdrawal of the pro

## 37 TexReg 2640 Apri/13, 2012 Texas Register posed disapproval ofthe SCT program rules in the April 8, 2011, issue ofthe Federal Register (76 FR 19739). The repeal of the Chapter 101 SCT program rules is adopted concurrently with amendments to sections in Chapter 117 that would remove references to the Chapter 101 SCT program rules. The amendments to Chapter 117 are published in a separate rulemaking in this issue ofthe Texas Register. Section by Section Discussion The adopted repeal of Division 5, System Cap Trading, §§101.380, 101.382, 101.383, and 101.385 will remove all rules related to the SCT program from Chapter 101. The SCT program was established to provide additional compliance flexibility to owners of EGFs subject to the system cap emission limits specified in Chapter 117; however, the program has seen minimal participation by affected sources. The Chapter 101 SCT program rules have been withdrawn from consideration by the EPA as a revision to the SIP and are not federally enforceable. The Chapter 117 rules specifying the system cap em ission limits have been approved by the EPA as a SIP revision and are therefore federally enforceable. The repeal of the SCT program rules will avoid any potential regulatory confusion among owners or operators of affected EGFs regarding the use of a compliance option that is no longer federally enforceable to meet a federally enforceable rule. Final Draft Regulatory Impact Analysis The commission reviewed the repeal of the SCT program rules from Chapter 101 in light of the regulatory impact analysis requirements of Texas Government Code, §2001.0225, and determined that the repeal does not meet the definition of a major environmental rule as defined in that statute, and in addition, if the rule did meet the definition, it would not be subject to the requirement to prepare a regulatory impact analysis. A major environmental rule means a rule, the specific intent of which is to protect the environment or reduce risks to human health from environmental exposure and that may adversely affect in a material way the economy, a sector ofthe economy, productivity, competition, jobs, the environment, orthe public health and safety ofthe state or a sector of the state. Instead, the specific intent of the repeal is to remove rules related to the SCT program from Chapter 101. The SCT program was established to provide additional compliance flexibility to sources subject to the system cap emission limits specified in Chapter 117; however, it has only seen minimal participation by affected sources. The SCT program rules in Chapter 101 have been withdrawn from consideration by the EPA as a revision to the SIP and are not federally enforceable, while the Chapter 117 rules specifying the system cap emission limits have been approved by the EPA as a SIP revision and are therefore federally enforceable. The repeal ofthe SCT rules in Chapter 101 will avoid potential regulatory confusion among owners or operators of sources subject to the system cap emission limits in Chapter 117 by removing a compliance flexibility option that is notfederally enforceable. The repeal is not anticipated to add any significant additional costs to affected individuals or businesses beyond what is already required to comply with these federal standards on the economy, a sector ofthe economy, productivity, competition, jobs, the environment, orthe public health and safety ofthe state or a sector of the state. Additionally, the repeal does not meet any ofthe four applicability criteria for requiring a regulatory impact analysis for a major environmental rule, which are listed in Texas Government Code,§2001.0225(a). Texas Government Code, §2001.0225, applies only to a major environmental rule, the result ofwhich is to: 1) exceed a standard set by federal law, unless the rule is specifically required by state law; 2) exceed an express requirement of state law, unless the rule is specifically required by federal law; 3) exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or 4) adopt a rule solely under the general powers of the agency instead of under a specific state law. The repeal will avoid potential regulatory confusion among owners or operators of EGFs subject to the system cap emission limits in Chapter 117 by removing a compliance flexibility option that is not federally enforceable. The repeal does not exceed a requirement of a delegation agreement or a contract between state and federal government if this rulemaking is adopted. The repeal was not developed solely underthe general powers ofthe agency, but is authorized by specific sections of Texas Health and Safety Code, Chapter 382 (also known as the Texas Clean AirAct), and the Texas Water Code, which are cited in the Statutory Authority section ofthis rulemaking. Therefore, this repeal is not subject to the regulatory analysis provisions ofTexas Government Code, §2001.0225(b). The commission invited public comment regarding the draft regulatory impact analysis determination during the public comment period. No comments were received on the draft regulatory impact analysis determination. Takings Impact Assessment Under Texas Government Code, §2007.002(5), taking means a governmental action that affects private real property, in whole or in part or temporarily or permanently, in a manner that requires the governmental entity to compensate the private real property owner as provided by the Fifth and Fourteenth Amendments to the United States Constitution or §17 or §19, Article I, Texas Constitution; or a governmental action that affects an owner's private real property that is the subject of the governmental action, in whole or in part or temporarily or permanently, in a manner that restricts or limits the owner's right to the property that would otherwise exist in the absence of the governmental action; and is the producing cause ofa reduction of at least 25% in the market value of the affected private real property, determined by comparing the market value of the property as if the governmental action is not in effect and the market value ofthe property determined as ifthe governmental action is in effect. The commission completed a takings impact analysis for the adopted repeal underTexas Government Code, §2007.043. The adopted rulemaking repeals rules related to the SCT program from Chapter 101. The repeal will not create any additional burden on private real property. The repeal will not affect private real property in a mannerthatwould require compensation to private real property owners under the United States Constitution or the Texas Constitution. The repeal also will not affect private real property in a manner that restricts or limits an owner's right to the property that would otherwise exist in the absence of the governmental action. Therefore, the repeal will not cause a taking under Texas Government Code, Chapter 2007. Consistency with the Coastal Management Program The commission reviewed the adopted rulemaking and found that it is subject to the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination Act, Texas Natural Resources Code, §§33.201 et seq., and therefore must be consistent with all applicable CMP goals and policies. The commission conducted a consistency determination for the adopted rulemaking in accordance with Coastal Coordination Act Implementation Rules, 31 TAG §505.22 and found the adopted rulemaking is consistent with the applicable CMP goals and policies. The CMP goal applicable to the adopted rules include to protect, preserve, restore, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (CNRA) (31 TAG §501.12(1)). The CMP policy applicable to the adopted rulemaking is the policy that commission rules comply with federal regulations in 40 Code of Federal Regulations, to protect and enhance air quality in the coastal areas so as to protect CNRAs and promote the public health, safety, and welfare (31 TAG §501.32). The adopted rulemaking will not increase emissions of air pollutants and is therefore consistent with the CMP goal in 31 TAG §501.12(1) and the CMP policy in 31 TAG §501.32. Promulgation and enforcement ofthis rulemaking will not violate or exceed any standards identified in the applicable CMP goals and policies because the adopted rulemaking is consistent with these CMP goals and policies and does not create or have a direct or significant adverse effect on any coastal natural resource areas. Therefore, in accordance with 31 TAG §505.22(e), the commission affirms that this rulemaking action is consistent with CMP goals and policies. The commission invited public comment regarding the consistency with the CMP during the public comment period. No comments were received on the CMP. Effect on Sites Subject to the Federal Operating Permits Program Chapter 101 is an applicable requirement under 30 TAG Chapter 122, Federal Operating Permits Program. Owners or operators with facilities subject to the federal operating permit program must revise their operating permit to remove all references to the SCT program rules. The owners or operators of these facilities will have the option of initiating a permit action or waiting for the next permit action, such as a renewal, to remove these references. Public Comment The commission scheduled public hearings in Houston on November 15, 2011, and in Austin on November 17, 2011. However, since no one registered to provide comments, the hearings were not officially opened. The comment period closed on October 21, 2011. The commission received one written comment from the EPA. Response to Comments The EPA stated its support ofthe repeal ofthe SCT program and all associated references to the SCT program in Chapter 117. The EPA further stated that the repeal of the SCT program will clarify the available compliance options for electric generating units in Texas. The commission appreciates the support and makes no changes to the rule based on this comment. Statutory Authority The repeals are adopted under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under



## ADOPTEDRULES Apri/13, 2012 37 TexReg 2641the lWC; lWC, §5.1 03, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the lWC; lWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes ofthe Texas Clean Air Act. The repeals are also adopted under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality ofthe state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control ofthe state's air. The adopted repeals implement lWC, §§5.1 02, 5.1 03, and 5.105; and THSC, §§382.002, 382.011, 382.012, and 382.017. This agency hereby certifies thatthe adoption has been reviewed by legal counsel and found to be a valid exercise ofthe agency's legal authority. Filed with the Office ofthe Secretary ofState on March 30, 2012. TRD-201201655 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Effective date: April19, 2012 Proposal publication date: October 21, 2011 For further information, please call: (512) 239-0779 

# • CHAPTER 114. 

# •

POLLUTION FROMM OR VEHICLES SUBCHAPTER K. MO ILE SOURCE INCENTIVE PROGRAM DIVISION 3. REDUCTION INCENTI E PROGRAM FOR ON-ROAD AND N N-ROAD VEHICLES 30 TAC §114.622 The Texas Commission on E ironmental Quality (TCEQ or commission) adopts an amend ent to §114.622 with changes to the proposed text as publis ed in the November 4, 2011, issue of the Texas Register(36 exReg 7468). This amendment will be submitt d to the United States Environmental Protection Agency (EPA) as a revision to the state implementation plan. Background and Summary ofth Factual Basis for the Adopted Rule The 77th Legislature, 2001, e acted Senate Bill 5 establishing the Texas Emissions Redu tion Plan (TERP). The TERP provides financial incentives for reducing emissions of on-road heavy-duty motor vehicles and on-road equipment. House Bill (HB) 3399, 82nd Legislature, 2 1, Regular Session, amended Texas Health and Safety Code ( HSC), Chapter 386, Subchap

## 37 TexReg 2642 Apri/13, 2012 Texas Register ter C, to revise existing criteria a add additional criteria for receiving an incentive grant under his subchapter. The changes made under HB 3399 are as su marized in the following paragraphs. Under THSC, §386.1 04(i), if the ommission determines that a heavy-duty motor vehicle or eng ne must be decommissioned as part ofthe incentive grant req irements, the new subsection outlines specific criteria for how he vehicle or engine must be destroyed, including making a ho in the engine block and permanently destroying the frame the vehicle. These requirements are consistent with curren practice ofthe commission in administering the grant programs In addition, the new subsection requires the commission to pr vide a means for an applicant to propose an alternative method orcomplying with the destruction requirements. Under THSC, §386.1 040), the e ecutive director of the TCEQ is to waive any eligibility requirem nts established under THSC, §386.1 04, on a finding of good cause, which may include a waiver for short lapses in registr tion or operation attributable to economic conditions, seasonal work, or other circumstances. In addition to the new languag outlining how vehicles and engines are to be destroyed und a grant, this section includes requirements for the operation an use ofgrant-funded vehicles and equipment in nonattainmen areas and affected counties for five years, provisions for eting cost-effectiveness requirements and other provision pertaining to the emissions reductions to be achieved by a reject, and provisions related to grant payments for the increm ntal costs of a project. Under the additional language of THS , §386.1040), any of these provisions could potentially be w ived by the executive director on a finding of good cause. UnderTHSC, §386.1 04(k), the co mission is to consider an application for the replacement of a ehicle that has been owned, leased, orotherwise commercially financed by the applicant. Under this new subsection, if a vehi le or engine that is leased or otherwise commercially financed ust be decommissioned, the commission is to ensure that the pplicant has the legal right to decommission the vehicle or engi e before a grant is awarded. Under THSC, §386.1 04(1), the mmission is to consider an application for a vehicle replace ent or fleet expansion for a project with an activity life of fiv years or more, or 400,000 miles, whichever is earlier. This hange modifies the previous requirements that vehicles be o erated in the nonattainment areas and eligible counties for at ast five years without regard to the accrued mileage. Finally, under THSC, §386.1 04( ), the commission is to provide a form that minimizes, to the aximum extent possible, the amount of paperwork required. The rule incorporates the chang s to THSC, §386.1 04, under HB 3399. Section Discussion §114.622, Incentive Program Re irements Section 114.622 is amended to i corporate changes and additions to the program eligibility crit ria under THSC, §386.1 04(i), (k), and (1). This section is also a ended to incorporate the provisions ofTHSC, §386.6220), dir ting the executive director to waive project eligibility requireme ts on a finding of good cause. Additional language is added sine proposal to make it clearthat, in granting a waiver, the executiv director is to determine that the emissions reductions attribute to the project will still be valid(4) the areas ofuse of he grant-funded vehicles, including consideration ofthe availability fuel and fueling infrastructure, the need for vehicle fleets to support eling infrastructure, andthe need for emissions reductions in those are in order to meet federal air quality standards;(5) support for conve moving goods and materials alon cities ofHouston, San Antonio, or diesel fuel to natural gas; ion oflarge regional vehicle fleets interstate highways connecting the lias, and Fort Worth from gasoline (6) support for projec s to reduce exposure ofvulnerable populations to pollutants of cone m, including conversion of school busfleets and otherfleets transport g childrenorthe elderly from gasoline or diesel fuel to natural gas; (7) support for conve ion ofpublic transportation fleets, such as school buses, transit bus , airport shuttle buses, and similar vehicle fleets from gasoline or die el fuel to natural gas; (8) support for conve sion of public utility and service fleets, such as refuse vehicles, m intenance and utility vehicles, and similar fleets from gasoline or die el fuel to natural gas; (9) support for the use ofnatural gas and natural gas vehicles, engines, and associated tee logies produced, manufactured, or otherwise based in Texas; and (10) supportfor irnple entationofnew and innovative natural gas vehicle and engine techn logies. (b) The executive directo may limit the grants under a grant application period according to th priorities established for that grant application period. (c) Not less than 60% of he total amount ofgrants awarded in a fiscal biennium must be awa ed to motor vehicles with a gross vehicle weight rating ofat least 33 001 pounds. However, this restriction does not apply ifthe comrnis ion does not receive enough grant applications to satisfy the percent e offunding requirement. This agency hereby certifies tha the adoption has been reviewed by legal counsel and found to b a valid exercise ofthe agency's legal authority. Filed with the Office ofthe Seer tary ofState on March 30, 2012. TRD-201201672 Robert Martinez Director, Environmental Law Divisi n Texas Commission on Environmen I Quality Effective date: April 19, 2012 Proposal publication date: Novemb r 4, 2011 For further information, please call: (512) 239-2141 

# • 

# • CHAPTER 117. CONTROL OF AIR POLLUTION FROM NITROGEN COMPOUNDS The Texas Commission on Environmental Quality (commission) adopts amendments to §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800 without changes to the proposed text as published in the October 21, 2011, issue of the Texas Register(36 TexReg 7138) and the text will not be republished. The amendments will be submitted to the United States Environmental Protection Agency (EPA) as a revision to the state implementation plan (SIP). Background and Summary ofthe Factual Basis for the Adopted Rules On March 21, 2001, the commission adopted rules that provided owners or operators ofelectric generating facilities (EGF) located in the Dallas-Fort Worth one-hour ozone nonattainment area (consisting of Collin, Dallas, Denton, and Tarrant Counties) or the East and Central Texas counties, as listed in §117.3000(a)(4), and subject to the system cap emission limits specified in Chapter 117 additional compliance flexibility in meeting their system caps through participation in the System Cap Trading (SCT) program. The SCT program was established through rules adopted by the commission on March 21, 2001, specifying the requirements for the SCT program in 30 TAC Chapter 101, Subchapter 

### H, Emissions Banking and Trading. The system cap emission limits in Chapter 117 set daily, 30-day rolling average, or annual emission caps on total nitrogen oxides (NOx) emissions from EGFs that are: subject to the Chapter 117 emission specifications for attainment demonstration (ESAD); under common ownership or control; and grouped together in an electric power generating system, as defined in §117.1 0(14). For example, ifcompany A has three sites, X, Y, and Zwith three, four, and 

### five EGFs, respectively, that are subject to the Chapter 117 ESADs and are part ofan electric power generating system, Chapter 117 sets a daily, 30-day rolling average, or annual emission caps on the total emissions from the 12 affected EGFs. On May 23, 2007, the commission adopted reformatted and renumbered Chapter 117 rules. The adopted rules also provided new emission specifications for the Dallas-Fort Worth 1997 eight-hour ozone nonattainment area (DFW area), consisting of Collin, Dallas, Denton, Ellis, Johnson, Kaufman, Parker, Rockwall, and Tarrant Counties, necessary to demonstrate the attainment of the 1997 eight-hour ozone National Ambient Air Quality Standards (NAAQS). Under the adopted rules, EGFs in the Collin, Dallas, Denton, or Tarrant Counties that are subject to the new emissions specifications are no longer required to meet the emission specifications specified in Chapter 117, Subchapter B, Division 2, or Subchapter C, Division 2, after March 1, 2009. For EGFs in the DFW area, the Chapter 117 rules do not allow participation in a system cap as an alternative means of compliance with the new emissions specifications, and hence EGFs in the DFW area no longer have the option of participating in the SCT program. Certain compliance flexibility options (the SCT program, the Emission Credit Banking and Trading program, and the Discrete Emission Credit Banking and Trading program) were provided by the adopted rules to owners or operators of EGFs with system cap emission limits specified in Chapter 117 and located in the Beaumont-Port Arthur 1997 ozone maintenance area (BPA area), consisting of Hardin, Jefferson, and Orange Counties; the Houston-Galveston-Brazoria 1997 eight-hour ozone nonattainment area (HGB area), consisting of Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties; and in the East and Central Texas counties of Atascosa, Bastrop, Bexar, Brazos, Calhoun, Cherokee, Fannin, Fayette, Freestone, Goliad, Gregg, Grimes, Harrison, Henderson, Hood, Hunt, Lamar, Limestone, Marion, McLennan, Milam, Morris, Nueces, Parker, Red River, Robertson, Rusk, Titus, Travis, Victoria, and Wharton. The adopted rules also made clear that EGFs in the HGB area are required to meet the system cap emission limits specified in §117.320 or §117.1220, in addition to complying with the emission specifications in



## ADOPTED RULES Apri/13, 2012 37 TexReg 2655§117.310 or §117.1210 through participation in the Mass Emissions Cap and Trade program. The SCT program rules in §101.383 and §101.385 were amended on July 25, 2007, to accurately reference the newly renumbered sections in Chapter 117 related to system cap emission limits. The SCT program has seen minimal participation from affected sources, and on February 23, 2011, the commission approved the withdrawal ofthe Chapter 101 SCT program rules from**co~­** sideration by the EPA as a revision to the SIP. The EPA wa? notified ofthis withdrawal in a letter dated March 4, 2011. While the repeal ofthe Chapter 101 SCT program rules and corresponding revisions to Chapter 117 are not specifically required by federal regulation, the Chapter 117 rules for system cap requirements are included in the SIP as published in the December 3, 2008, issue ofthe Federal Register(73 FR 73562) and allow the SCT program as a regulatory option for compliance.**~emov~ng** the references to the SCT program in Chapter 117 Will avo1d confusion among regulated entities that are subject to the Chapt.er 117 system cap emission limits and will address any potential concerns regarding the use of a compliance option that is not federally enforceable to meet a federally enforceable rule. The amendments to §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800 are adopted concurrently with the repeal of sections pertaining to the SCT program from Chapter 101. The repeal of sections pertaining to the SC}'**p~ogr~m.** from Chapter 101 is published in a separate rulemakmg m th1s 1ssue of the Texas Register. Section by Section Discussion The adopted rulemaking will amend the major source rules.**i~** Chapter 117, Subchapter C, Divisions 1- 3; Subchapter E, DIVIsion 1; and Subchapter H, Division 2. These adopted changes will amend §§117.1020, 117.1120, 117.1220, 117.3020, and 117.9800 by removing references to Chapter 101 SCT 

# program rules. The adopted rulemaking**~ill** also include vanous non-substantive revisions to these sect1ons to conform to current Texas Registerstyle and format requirements. §§117.1020, 117.1120, 117.1220, 117.3020, System Cap The adopted amendments to §§117.1020(1), 117.1120(1), 117.1220(1), and 117.3020(1) remove all references to Chapter 101, Subchapter H, Division 5, SCT program. §117.9800, Use ofEmission Credits for Compliance The adopted amendments to §117.9800(b) remove references to the SCT program requirements in Chapter 101, Subchapter H, Division 5. Final Draft Regulatory Impact Analysis The commission reviewed the adopted rulemaking in light ofthe regulatory impact analysis requirements of the Texas Government Code, §2001.0225, and determined that the adopted rulemaking does not meet the definition of a "major environmental rule" as defined in that statute

.. A "major environmental rule" means a rule, the specific intent ofwhich is to protect the environment or reduce risks to human health from environmental exposure, and that may adversely affect in a material waythe economy, a sector ofthe economy, productivity, competition, jobs, the environment, orthe public health and safety of the state or a sector ofthe state. The purpose of the adopted rulemaking is to remove the references to the Chap

## 37TexReg 2656 Apri/13, 2012 Texas Register ter 101 SCT program rules from Chapter 117. The SCT rules in Chapter 101 are being repealed in a concurrent rulemaking and are not a part ofthe SIP. Therefore, the adopted rulemaking will remove the option to use the SCT program from Chapter 117 to avoid any potential concerns that a compliance option that is not federally enforceable might be used to meet a federally enforceable rule. Additionally, the adopted rulemaking does not**me~t** any of the four applicability criteria for requiring a regulatory Impact analysis for a major environmental rule, which are listed in Texas Government Code, §2001.0225(a). Texas Government Code, §2001.0225, applies only to a major environmental rule, the result of which is to: 1) exceed a standard set by federal law, unless the rule is specifically required by state law; 2) exceed an express requirement of state law, unless the rule is specifically required by federal law; 3) exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or4) adopt a rule solely under the general powers ofthe agency instead of under a specific state law. The requirement to provide a fiscal analysis ofthe adopted regulations in the Texas Government Code was amended by Senate Bill (SB) 633 during the 75th Legislature, 1997. The.intent ofSB 633 was to require agencies to conduct a regulatory 1mpact analysis of extraordinary rules. These are**identifi~d** in the**statut~ry** language as major environmental rules that w1ll have a matenal adverse impact and will exceed a requirement of state law, federal law, or a delegated federal program, or are adopted sol.ely underthe general powers ofthe agency. With the understanding that this requirement would seldom apply, the commission provided a cost estimate for SB 633 concluding that "based on an assessment of rules adopted by the agency in the past, it is not anticipated that the bill will have significant fiscal implications for the agency due to its limited application." The commission also noted that the number of rules that would require assessment under the provisions of the bill was not large. This conclusion was based, in part, on the criteria set forth in the bill that exempted rules from the full analysis unless the rule was a major environmental rule that exceeds a federal law. The Federal Clean Air Act (FCAA) does not always require specific programs, methods, or reductions in order to meet the NAAQS; thus, states must develop programs for each area**co~­** tributing to nonattainment to help ensure that**thos~** areas Will meet the attainment deadlines. Because ofthe ongomg need to address nonattainment issues, and to meet the requirements of 42 United States Code (USC), §7410, the commission routinely proposes and adopts SIP rules. The legislature is presumed to understand this federal scheme. If each rule adopted for inclusion in the SIP was considered to be a major environmental rule that exceeds federal law, then every SIP rule would require the full regulatory impact analysis contemplated by SB 633. This conclusion is inconsistent with the conclusions reached by the commission in its cost estimate and by the**L.egislati~e** Budget Board (LBB) in its fiscal notes. Since the legislature IS presumed to understand the fiscal impacts ofthe bills it passes, and that presumption is based on information provided by state agencies and the LBB, the commission**believe~** that the**inte~t** of SB 633 was only to require the full regulatory 1mpact analysis for rules that are extraordinary in nature. While the SIP rules will have a broad impact, the impact is no greater than is necessary or appropriate to meet the requirements ofthe FCAA. Forthese reasons, rules adopted for inclusion in the SIP fall under the exception in Texas Government Code, §2001.0225(a), becausethey are required by and do not exceed, federal law, including the approved SIP. In addition, these rules do not exceed any contract between the state and a federal agency. The commission has consistently applied this construction to its rules since this statute was enacted in 1997. Since that time, the legislature has revised the Texas Government Code but left this provision substantially unamended. It is presumed that "when an agency interpretation is in effect at the time the legislature amends the laws without making substantial change in the statute, the legislature is deemed to have accepted the agency's interpretation." Central Power & Light Co. v. Sharp, 919 S.W.2d 485, 489 (Tex. App. Austin 1995), writ denied with per curiam opinion respecting another issue, 960 S.W.2d 617 (Tex. 1997); Bullock v. Marathon Oil Co., 798 S.W.2d 353, 357 (Tex. App. Austin 1990, no writ). Cf. Humble Oil & Refining Co. v. Calvert, 414 S.W.2d 172 (Tex. 1967); Dudney v. State Farm Mut. Auto Ins. Co., 9 S.W.3d 884, 893 (Tex. App. Austin 2000); Southwestern Life Ins. Co. v. Montemayor, 24 S.W.3d 581 (Tex. App. Austin 2000, pet. denied); and Coastallndust. Water Auth. v. Trinity Portland Cement Div., 563 S.W.2d 916 (Tex. 1978). The commission's interpretation of the regulatory impact analysis requirements is also supported by a change made to the Texas Administrative Procedure Act (APA) by the legislature in 1999. In an attempt to limitthe number of rule challenges based upon APA requirements, the legislature clarified that state agencies are required to meet these sections of the APA against the standard of "substantial compliance." The legislature specifically identified Texas Government Code, §2001.0225, as falling under this standard. The commission has substantially complied with the requirements of Texas Government Code, §2001.0225. As defined in the Texas Government Code, §2001.0225 only applies to a major environmental rule, the result ofwhich is to: exceed a standard set by federal law, unless the rule is specifically required by state law; exceed an express requirement of state law, unless the rule is specifically required by federal law; exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or adopt a rule solely under the general powers of the agency instead of under a specific state law. This rulemaking action does not meet any of these four applicability requirements of a "major environmental rule." The adopted rulemaking will remove an obsolete compliance option from Chapter 117, and therefore avoid any potential concerns that a compliance option that is notfederally enforceable might be used to meet a federally enforceable rule. This rulemaking action does notexceed an express requirement efstate law or a requirement ofa delegation agreement, and was not developed solely underthe general powers ofthe agency, but is authorized under Texas Health and Safety Code, §§382.011, 382.012, and 382.017, as well as under 42 USC, §§7401, 

## et seq., which requires states to submit SIP revisions that specify the manner in which the NAAQS will be achieved and maintained within each air quality control region of the state. The commission invited public comment regarding the draft regulatory impact analysis determination during the public comment period. No comments were received on the draft regulatory impact analysis determination. Takings Impact Assessment Under Texas Government Code, §2007.002(5), taking means a governmental action that affects private real property, in whole or in part or temporarily or permanently, in a manner that requires the governmental entity to compensate the private real property owner as provided by the Fifth and Fourteenth Amendments to the United States Constitution or §17 or §19, Article I, Texas Constitution; ora governmental action that affects an owner's private real property that is the subject of the governmental action, in whole or in part or temporarily or permanently, in a manner that restricts or limits the owner's right to the property that would otherwise exist in the absence of the governmental action; and is the producing cause of a reduction of at least 25% in the market value of the affected private real property, determined by comparing the market value of the property as if the governmental action is not in effect and the marketvalue ofthe property determined as ifthe governmental action is in effect. The commission completed a takings impact analysis for the adopted repeal underTexas GovernmentCode, §2007.043. The adopted rules will remove the references to the Chapter 101 SCT program rules from Chapter 117. The SCT program rules in Chapter 101 are being repealed in a concurrent rulemaking, and are not a part of the SIP. Therefore, the adopted rulemaking will remove the option to use the SCT program from Chapter 117 to avoid any potential concerns that a compliance option that is not federally enforceable might be used to meet a federally enforceable rule. The adopted amendments will not create any additional burden on private real property. The adopted amendments will not affect private real property in a manner that would require compensation to private real property owners underthe United States Constitution orthe Texas Constitution. The adopted amendments will not affect private real property in a manner that restricts or limits an owner's right to the property that would otherwise exist in the absence of the governmental action. Therefore, the adopted amendments will not cause a taking under Texas Government Code, Chapter 2007. Consistency with the Coastal Management Program The commission reviewed the adopted rulemaking and found that it is subject to the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination Act, Texas Natural Resources Code, §§33.201 

## etseq., and therefore must be consistent with all applicable CMP goals and policies. The commission conducted a consistency determination for the adopted rules in accordance with Coastal Coordination Act Implementation Rules, 31 TAC §505.22 and found the adopted rulemaking is consistent with the applicable CMP goals and policies. The CMP goal applicable to the adopted rulemaking is the goal to protect, preserve, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (CNRA) (31 TAC §501.12(1)). The CMP policy applicable to the adopted rulemaking is the policy that commission rules comply with federal regulations in 40 Code of Federal Regulations, to protect and enhance air quality in the coastal areas so as to protect CNRAs and promote the public health, safety, and welfare (31 TAC §501.32). The adopted rulemaking will not increase emissions of air pollutants and is therefore consistent with the CMP goal in 31 TAC §501.12(1) and the CMP policy in 31 TAC §501.32. Promulgation and enforcement of these rules will not violate or exceed any standards identified in the applicable CMP goals and policies because the adopted rules are consistent with these CMP goals and policies and because these rules do not create or have a direct or significant adverse effect on any coastal natural resource areas. Therefore, in accordance with 31 TAC



## ADOPTED RULES Aprill3, 2012 37 TexReg 2657§505.22(e), the commission affirms that this rulemaking action is consistent with CMP goals and policies. The commission invited public comment regarding the consistency with the CMP during the public comment period. No comments were received concerning the CMP. Effect on Sites Subject to the Federal Operating Permits Program Chapter 117 is an applicable requirement under 30 TAC Chapter122, Federal Operating Permits Program. Owners or operators with facilities subjectto the federal operating permit program must revise their operating permit to include the new Chapter 117 requirements. The owners or operators of these facilities will have the option of initiating a permit action orwaiting for the next permit action, such as a renewal, to include these requirements. Public Comment The commission scheduled public hearings in Houston on November 15, 2011, and in Austin on November 17, 2011. However, since no one registered to provide comments, the hearings were not officially opened. The comment period closed on October 21, 2011. The commission received one written comment from the EPA in support ofthe rulemaking. Response to Comments The EPA stated its support ofthe repeal ofthe SCT program and all associated references to the SCT program in Chapter 117. The EPA further stated that the repeal ofthe SCT program will clarify the available compliance options for electric generating units in Texas. The commission appreciates the comment and the support. No changes were made to the rule based on this comment. 

## SUBCHAPTER C. COMBUSTION CONTROL AT MAJOR UTILITY ELECTRIC GENERATION SOURCES IN OZONE NONATTAINMENT AREAS DIVISION 

## 1. BEAUMONT-PORT ARTHUR OZONE NONATTAINMENT AREA UTILITY ELECTRIC GENERATION SOURCES 30 TAC §117.1020 Statutory Authority The amended section is adopted under Texas Water Code (TWC), §5.102, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.1 03, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amended section is also adopted under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and



## 37TexReg 2658 Apri/13, 2012 Texas Register Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amended section is also adopted under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amended section is also adopted under Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, 

### et seq., which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region ofthe state. The amended section implements TWC, §§5.1 02, 5.1 03, and 5.105; THSC, §§382.002, 382.011, 382.012,382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 

### etseq. This agency hereby certifies thatthe adoption has been reviewed by legal counsel and found to be a valid exercise ofthe agency's legal authority. Filed with the Office ofthe Secretary ofState on March 30, 2012. TRD-201201656 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Effective date: April 19, 2012 Proposal publication date: October 21, 2011 For further information, please call: (512) 239-0779 

# • • • DIVISION 2. DALLAS-FORT WORTH OZONE NONATTAINMENT AREA UTILITY ELECTRIC GENERATION SOURCES 30 TAC §117.1120 Statutory Authority The amended section is adopted under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.103, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amended section is also adopted under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper controlof the state's air. The amended section is also adopted under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amended section is also adopted under Federal Clean Air Act (FCM), 42 United States Code (USC), §§7401, 

### et seq., which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state. The amended section implements TWC, §§5.1 02, 5.1 03, and 5.105; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and FCM, 42 USC, §§7401 

### et seq. This agency hereby certifies thatthe adoption has been reviewed by legal counsel and found to be a valid exercise ofthe agency's legal authority. Filed with the Office ofthe Secretary ofState on March 30, 2012. TRD-201201657 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Effective date: April 19, 2012 Proposal publication date: October 21, 2011 For further information, please call: (512) 239-0779 

# • • • DIVISION 3. HOUSTON-GALVESTONBRAZORIA OZONE NONATTAINMENT AREA UTILITY ELECTRIC GENERATION SOURCES 30 TAC §117.1220 Statutory Authority The amended section is adopted under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.103, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amended section is also adopted under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amended section is also adopted under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amended section is also adopted under Federal Clean Air Act (FCAA). 42 United States Code (USC), §§7401, 

### et seq., which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state. The amended section implements TWC, §§5.1 02, 5.1 03, and 5.105; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and FCM, 42 USC, §§7401 et seq. This agency hereby certifiesthatthe adoption has been reviewed by legal counsel and found to be a valid exercise ofthe agency's legal authority. Filed with the Office ofthe Secretary of State on March 30, 2012. TRD-201201658 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Effective date: April19, 2012 Proposal publication date: October 21, 2011 For further information, please call: (512) 239-0779 

# • + • SUBCHAPTER E. MULTI-REGION COMBUSTION CONTROL DIVISION 1. 

## UTILITY ELECTRIC GENERATION IN EAST AND CENTRAL TEXAS 30 TAC §117.3020 Statutory Authority The amended section is adopted under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.1 03, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amended section is also adopted under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amended section is also adopted under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning



## ADOPTED RULES Apri/13, 2012 37 TexReg 2659Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amended section is also adopted under Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, et seq., which requires states to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region ofthe state. The amended section implements TWC, §§5.1 02, 5.1 03, and 5.105; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq. This agency hereby certifies thatthe adoption has been reviewed by legal counsel and found to be a valid exercise ofthe agency's legal authority. Filed with the Office ofthe Secretary of State on March 30, 2012. TRD-201201659 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Effective date: April 19, 2012 Proposal publication date: October 21, 2011 For further information, please call: (512) 239-0779 

# • SUBCHAPTER H. PROVISIONS 

# • 

# • ADMINISTRATIVE
DIVISION 2. COMPLIANCE FLEXIBILITY 30 TAC §117.9800 Statutory Authority The amended section is adopted under Texas Water Code (TWC), §5.1 02, concerning General Powers, that provides the commission with the general powers to carry out its duties under the TWC; TWC, §5.103, concerning Rules, that authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; TWC, §5.1 05, concerning General Policy, that authorizes the commission by rule to establish and approve all general policy of the commission; and under Texas Health and Safety Code (THSC), §382.017, concerning Rules, that authorizes the commission to adopt rules consistent with the policy and purposes of the Texas Clean Air Act. The amended section is also adopted under THSC, §382.002, concerning Policy and Purpose, that establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; THSC, §382.011, concerning General Powers and Duties, that authorizes the commission to control the quality of the state's air; and THSC, §382.012, concerning State Air Control Plan, that authorizes the commission to prepare and develop a general, comprehensive plan for the proper control of the state's air. The amended section is also adopted under THSC, §382.016, concerning Monitoring Requirements; Examination of Records, that authorizes the commission to prescribe reasonable requirements for the measuring and monitoring of air contaminant emissions and THSC, §382.021, concerning Sampling Methods and Procedures, that authorizes the commission to prescribe sampling methods. The amended section is also adopted under Federal Clean Air Act (FCAA), 42 United States Code (USC), §§7401, et seq., which requires states



## 37 TexReg 2660 Apri/13, 2012 Texas Register to submit state implementation plan revisions that specify the manner in which the National Ambient Air Quality Standards will be achieved and maintained within each air quality control region of the state. The amended section implements TWC, §§5.1 02, 5.1 03, and 5.105; THSC, §§382.002, 382.011, 382.012, 382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 etseq. This agency hereby certifies thatthe adoption has been reviewed by legal counsel and found to be a valid exercise ofthe agency's legal authority. Filed with the Office ofthe Secretary ofState on March 30, 2012. TRD-201201660 Robert Martinez Director, Environmental Law Division Texas Commission on Environmental Quality Effective date: April 19, 2012 Proposal publication date: October 21, 2011 For further information, please call: (512) 239-0779 

# • CHAPTER 328. RECYCLING 

# • MINIMIZATION AND
SUBCHAPTER 

## J. TEL VISION EQUIPMENT RECYCLING PROG 30 TAC §§328.161, 328.163, 28.165, 328.167, 328.169, 328.171,328.173, 328.175,32 .177, 328.179,328.181, 328.183, 328.185, 328.187, 32 .189, 328.191, 328.193, 328.195, 328.197 The Texas Commission on or commission) adopts new 328.167, 328.169, 328.171, 328.179, 328.181, 328.183, 328.191, 328.193, 328.195, an nvironmental Quality (TCEQ §328.161, 328.163, 328.165, 328.173, 328.175, 328.177, 328.185, 328.187, 328.189, 328.197. Sections 328.165 and 328.185 re adopted with changes to the proposed text as published in t e November 18, 2011, issue of Texas Register (36 TexReg 77 2). Sections 328.161, 328.163, 328.167, 328.169, 328.171, 328.173, 328.175, 328.177, 328.179, 328.181, 328.183, 328.187, 328.189, 328.191, 328.193, 328.195, and 328.19 are adopted without changes to the proposed text and will not e republished. Background and Summary oft e Factual Basis for the Adopted Rules Senate Bill (SB) 329, passed b the 82nd Legislature, 2011, requires the commission to impl ment a television equipment recycling program based on indi dual manufacturer responsibility and shared responsibility amo g consumers, retailers, and the government of this state. Th legislation authorizes the commission to adopt rules to help implement the program. Adopting rules will help the TCEQ to mplement the program more efficiently. The legislation also tates that the commission must adopt any rules required to im lement SB 329 by May 1, 2012. Section by Section Discussion The commission adopts new ubchapter J, Television Equipment Recycling Program, to C apter 328. §328.161, Purpose

# T C E THE STATE**OfH~E;XAS** 

# EXAS OMMISSION ON**NVIROWOii~~itLITY ~**  I

### here~y:~rtify.**~~a~J~~~~ ~**  true and corregt copy of a 

# t-o**~) Te~~s;_C.<?Ollll~$;~'op·on**  

### Environmental Quality document,

## 1~ \><J'

.

## w~.· ..

## ~chJS'file~...

## ~~-~.he.~ ..ermanent .r.eco,rds ofthe Commission. 

### If' "" G1vel') under my haRd'and the seal of office on

# ~ 

# '**bir:f!-}J~** APR 0

# 3 2012 BridgetV{;hac, Chief Clerk

. Texas Commission on Environmental Quality 

## ORDERADOPTINGAMENDEDAND REPEALED RULEAND REVISION TO THE STATE IMPLEMENTATION PLAN



## Docket No. 2011-0845-RUL

OnMarch 28, 2012, theTexas Commission on Environmental Quality (Commission), during a public meeting, considered adoption ofthe repeal of§§ 101.380, 101.382, 101.383, and 101.385. The Commission adopts this repeal, in Chapter 101, Subchapter H, Emissions Banking andTrading. This repeal removes rules thatthe Commission has previously vvithdra-vvn from the state implementation plan. The Commission also considered adoption ofamendmentsto §§ 117.1020, 117.1120, 117.1220, 117.3020, and 117.9800. The Commissions adopts these amendments in Chapter 117, Control ofAir Pollutionfrom Nitrogen Compounds, and corresponding revisions to the SIP. These amendments remove from Chapter 117 obsolete references tothe Chapter 101 System Cap Trading Rules thatthe Commission is repealing vvith this Order. Under Tex. Health & 

## Safety Code Ann.§§ 382.011, 382.012, and 382.023 (Vernon 2001), the Commission has the authorityto control the quality ofthe state's air andto issue orders consistentvvith the policies andpurposes oftheTexas CleanAir Act, Chapter 382 ofthe Tex. Health & 

## Safety Code. The proposed rules were publishedfor commentin the October 21, 2011, issue ofthe Texas Register 

## (36 TexReg 7124 and 36 TexReg 

## 7138). Pursuantto Tex. Health & 

## Safety Code Ann.§ 382.017 (Vernon 2001), Tex. Gov't Code Chapter 2001 (Vernon 2008), and40 Code ofFederal Regulations§ 51.102, and after proper notice, theCommission conducted public hearings to consider the repeal, and amended rules andrevisions to the SIP. Proper notice included prominent advertisement inthe areas affected atleast 30 days priorto the dates ofthe hearings. Public hearings onthe proposal were scheduled on November 15, 2011, at 1:30 p.m. and 6:00p.m. atthe Houston-Galveston Area Council offices in Houston; and on November 17, 2011, at 2:00p.m. attheTexas Commission on Environmental Quality headquarters inAustin. The Commission circulated hearing notices ofits intended action to the public, including interestedpersons, the Regional Administrator ofthe EPA, and all applicable local air pollution control agencies. The public vv·as invitedto submit data, vievvs, and recommendations onthe proposed repeal and amendedrules and SIP revisions, either orally or in vVTiting, at thehearings or during the commentperiod. Prior to the scheduled hearings,\ \\' 'I!. i i

.. ''t· :?A.,f::JT4():::llYT83!-i1

6 

## :c

# -:c;gp}~~:.gf~~pxP:~:J~8·;~£~~:~!~ended rules and SIP revisions, were available for public iY''''u:

### inspection~atrffie·-C6'mmi.ssi-on's:Central 

# office and onthe·Commission's Web site.**no~ ~~;:'!:J"f'** **""~-·c,** :·.- :: r. t 

### 7 .,**at~~0** .._**3·~ .~** **~ ;~;r~b**  Hn¢jQ**~5:** F

..:1L l:'e;:**~** '.**~ f1:-)~f\~\**  \ 1 , •'':;

# ~:·**;,~~t}i.Vwg~~~t~~·,~¢2;~fue~d~iions** ofinterestedpersons regarding the proposed

..' ·

# repeal;'~rid**~Pi~na~et:T.'ule~iijnd** SIF:'revisions were submittedto the Commission during the comment**·per'i~td;\~ifd~were'tfonsitlered** 

# bythe Commission as reflected inthe analysis of**tesfifittfriy fnB8rp.,.orktgdrl)y£efer~iic~** 

# tothis Order. The Commissionfinds thatthe analysis of testimonyincludes the names ofall interestedgroups orassociations offering comment on the proposedrepeal and amendedrules andthe SIP revisions andtheirposition concerning the same. IT IS THEREFORE ORDERED BY THE COMMISSION thatthe repealed and amendedrules andrevisions tothe SIP incorporatedbyreference tothis Order are hereby adopted. The Commission further authorizes staffto make any non-substantive revisions to therules necessaryto complywith 

# Texas Registerrequirements. The adoptedrules andthe preambletothe adoptedrules andthe revisions tothe SIP are incorporatedbyreference in this Order as ifsetforth atlengthverbatim inthis Order. IT IS FURTHER ORDERED BYTHE COMMISSION that onbehalfofthe Commission, the Chairman shouldtransmit a copy ofthis Order, together with the adopted rules andrevisions tothe SIP, tothe Regional Administrator ofEPA as a proposedrevision to theTexas SIP pursuanttothe Federal Clean AirAct, codified at42 U.S. Code Ann. §§ 7401- 7671q, as amended. This Order constitutes the Order ofthe Commission requiredbytheAdministrative Procedure Act, Tex. Gov't Code,§ 2001.033 (Vernon 2008). If

# anyportion ofthis Order is for anyreasonheldtobeinvalidby a court ofcompetent jurisdiction,the invalidity ofanyportion shall not affect thevalidity ofthe remaining portions.

Issued date: 

# APR 03 2012
TEXAS COMMISSION ON ENVIRONMENTAL QUALITY