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 and Preventing 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 Project No 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 adopted amendments to §§117.1020, 117.1120, 117.1220, 117.3020, and 

117.98oo in 30 TAC Chapter 117, Control of Air Pollution from Nitrogen Compounds; and 

corresponding revisions to the SIP. The SIP revision removes all references to the System 

Cap Trading rules (which were repealed from 30 TAC Chapter 101, General Air Quality Rules, 

in the same action) from Chapter 117. The proposed rules were published in the October 21, 

2011, issue of the Texas Register (36 TexReg 7138) 

Enclosed are the proposed revisions to the SIP, a public hearing certification, a complete 

record of the public hearings, and the accompanying order. I look forward to your 

expeditious approval of these SIP revisions. 

Sincerely, I 

~.-..'-·~vA~ra.w- Bryan W. Shaw, Ph.D. 

Chairman 

BWS/ab 

Enclosures 

cc: The Honorable Rick Perry, Governor of Texas 

Mr. Toby Baker, Office of Budget, Planning and Policy, Office of the 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 certify that the attached electronic file is included and that the electronic file is a 

true and correct copy of documents for a revision to the Texas State Implementation Plan, 

adopted on March 28, 2012, pursuant to 4-o Code of Federal Regulations § 51.104. I am the 

records administrator for the Air Quality Division of the Texas 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 of the 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 of this hearing record are maintained in the TCEQ central office at 12100 Park 35 

Circle, Austin, Texas 78753. For further information, please contact Shantha Daniel, Ph.D. at(512) 

239-3930. 
NOTICE & PROPOSAL 
PUBLIC NOTIFICATION 

Notification to the public of the 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 of the 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 of the 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 of Austin, 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 of Air Pollufion 

From Nitrogen Compounds, and corresponding revlsfons to the state 

Implementation plan (SIP) under the requirements of Texas 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 

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, or faxed 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 If all hearin a 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 

of the notice of the contested case he rina, the scope of the 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 of this title ndofSOAH 1 TAC Chapter 155 

(relating to Rules ofProcedure ), the A dministrative Law Judae shall establish a procedural schedule which shall provide for, as appropriate 

discovery, hearina date and pre- and post-hearing briefinas to comply 

with the provisions ofTexas Health aJ d Safety Code ~382.059 and this 

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 of Texas Health and Safety Cc de, §382.059 and this section. 

ill Pleadinas Following Pro osal for Decision. The pleading 

requirements of ~80.257 of this 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 of issuance ofthe proposal r. r decision. Any replies to exceptions shall be filed within eight busin ss days after the date of issuance 

of the QrOQosal for decision. 

ill Chanae of filing dea lines. On his own motion or at 

the request of a 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 chief clerk, and must serve 

a copy on the general counsel. the iu ge, and the other parties. The request must explain that the party req fie sting the chan oe 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 pr bposed dates. 

.ill Notice ofDecision. No I er than 120 days from the date of 

issuance of a draft permit the commis ion shall make a final decision on 

a permit amendment application unc er this section. The commission 

shall send notice of a decision on ar application for a permit amendment by first-class mail to the applica t and all persons 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 of the 

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 of the commission to issue or deny a permit amendment m y file a motion for rehearina under 

§80.272 of this title. If the motion is denied under §80.272 and §80.273 

of this title the commission's dec i 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 on the sixth anniversary of 

the date the EPA administrator ado ts standards for existing_ EGFs under the Federal Clean Air Act. §I 12 unless a stay of the rule is oranted. 

This agency hereby certifies 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 of the Secre ary of State on October 7, 2011. 

TRD-2011 04230 

Robert Martinez 

Director, Environmental Law Divisic f1 

Texas Commission on Environmen al Quality 

Earliest possible date of adoption: ovember 20, 2011 

For further 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 §§117.1 020, 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 Summary of the Factual Basis for 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 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 

(NO.) 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, if company A has three sites, X, Y, and Z with 3, 4, and 

5 EGFs, respectively, that are subject to the Chapter 117 ESADs 

and are part of an 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, 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 of this withdrawal in a letter dated March 4, 2011. While the 

repeal of the 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 major source 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 Register style 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 owner or operator 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 of Emission 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 1 01, 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 of state 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 of the repeals are addressed in a separate rulemaking addressed in this issue of the 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 7139 
Nina 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 of the 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 meet the 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 way the economy, a sector of the economy, productivity, competition, jobs, the environment, or the public health 

and safety of the state or a sector of the state. The purpose of the 

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 delega36 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 of the 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 of the FCAA. For these 

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. 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 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 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 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 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 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 

of state law or a requirement of a delegation agreement, and was 

not developed solely under the general powers of the agency, but 

is authorized under Texas Health and Safety Code, §§382.011, 

382.012, and 382.017, as well as under 42 USC, §§7 401, 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. 

Written comments on the draft regulatory impact analysis determination may be submitted to the contact person at the address 

listed under the Submittal of Comments section of this 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; 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 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 of the property determined as if the governmental action is in effect. 

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

proposed rules will remove the references to the Chapter 1 01 

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 of this rulemaking may be 

submitted to the contact person at the address listed under the 

Submittal of Comments section of this 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 of these 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 rea36 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), §§7 401, 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, §§7 401 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 of this 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 of this title (relating to Definitions), that would otherwise be subject to the NO, emission rates of §117.1010 of this 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 must be 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 of both paragraphs (1) and (2) of this 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 of the following methods to provide substitute emissions compliance data during periods when the NO, monitor is off-line: 

(1) if the NO, monitor is a continuous emissions monitoring system (CEMS): 

(A) subject to 40 Code of Federal 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 .I 040( d) of this title; 

(3) if the 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) 

of this title (relating to Emission Monitoring System Requirements for 

Utility Electric Generation Sources); or 

( 4) use the maximum block one-hour emission rate as measured by the 30-day testing. 

(f) The owner or operator of any EGF subject to a system cap 

shall maintain daily records indicating the NO, emissions and fuel usage from each EGF and summations of total 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 .I 045 of this title (relating to 

Notification, Recordkeeping, and Reporting Requirements). 

(g) The owner or operator of any EGF subject to a system cap 

shall report any exceedance of the system cap emission limit within 48 

hours to the appropriate regional office. The owner or operator shall 

then follow up within 2I days of the exceedance with a written report 

to the regional office that includes an analysis of the cause for the exceedance with appropriate data to demonstrate the amount of emissions 

in excess of the 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 of this title (relating 

to Compliance Schedule for Beaumont-Port Arthur Ozone Nonattainment Area Utility Electric Generation Sources). 

(i) An EGF that 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, I999. 

The system cap emission limit is calculated in accordance with subsection (b) of this section. 

(j) Emission reductions from shutdowns or curtailments that 

have been used for netting or offset purposes under the requirements 

of Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification) may not be included in the 

baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission limit, the contribution of each affected EGF that is 

operating during a startup, shutdown, or emissions event as defined in 

§ IO 1.1 of this title (relating to Definitions) must be calculated from the 

NO, emission rate measured by the NO, monitor, if operating properly. If the NO, monitor is not operating properly, the substitute data 

procedures identified in subsection (e) of this 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 of compliance, unless the owner 

or operator provides data demonstrating to the satisfaction of the 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 of NO, 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 of this title (relating to Use of Emission Credits 

for Compliance) or Chapter IOI, Subchapter H, Division I or 4 [, 4-, 

& ~] of this 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 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 of the 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 of this 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 of this section. 

(b) Each EGF within an electric power generating system, as 

defined in § 117.10 of this title (relating to Definitions), that would othenvise be subject to the NO, emission rates of§ 117.1110 of this 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 of both paragraphs (1) and (2) of this 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 of the following methods to provide substitute emissions compliance data during periods when the NO, monitor is off-line: 

(1) if the NO, monitor is a continuous emissions monitoring system (CEMS): 

(A) subject to 40 Code of Federal 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) of this title; 

(3) if the NO, 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) 

of this title (relating to Emission Monitoring System Requirements for 

Utility Electric Generation Sources); or 

(4) ifthe methods specified in paragraphs (1)- (3) of this 

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 of any EGF subject to a system cap 

shall maintain daily records indicating the NO, emissions and fuel usage from each EGF and summations of total 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 of this title (relating to 

Notification, Recordkeeping, and Reporting Requirements). 

(g) The owner or operator of any EGF subject to a system cap 

shall report any exceedance of the 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 of the exceedance with a written report 

to the regional office that includes an analysis of the cause for the exceedance with appropriate data to demonstrate the amount of emissions 

in excess of the 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 of any EGF subject to a system cap 

shall demonstrate initial compliance with the system cap in accordance 

with the schedule specified in §117.9110 of this title (relating to Compliance Schedule for Dallas-Fort Worth Ozone Nonattainment Area 

Utility Electric Generation Sources). 

(i) An EGF that 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) of this section. 

(j) Emission reductions from shutdowns or curtailments that 

have been used for netting or offset purposes under the requirements 

of Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification) may not be included in the 

baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission limit, the contribution of each affected EGF that is 

operating during a startup, shutdown, or emissions event as defined in 

§ 101.1 of this title (relating to Definitions) must be calculated from the 

NOx emission rate measured by the NO, monitor, if operating properly. If the NO, monitor is not operating properly, the substitute data 

procedures identified in subsection (e) of this 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 of compliance, unless the owner 

or operator provides data demonstrating to the satisfaction of the 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 of NO, 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 of this title (relating to Use of Emission Credits 

for Compliance) or Chapter 101, Subchapter H, Division 1 or 4 [, 4; 

m -S-] of this title (relating to Emission Credit Banking and Trading; 

and Discrete Emission Credit Banking and T rading[t -arui-System Gap 

+roiling]). 

(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. The value I\ in this section is based on the unit's 

status as part of a large or small system as ofJanuary 1, 2000, and does 

not change as a result of sale or transfer of the unit, regardless of the 

size of the transferee's system. 

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 of the Secretary of State on October 7, 2011 . 

TRD-2011 04235 
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 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 

of this section. 

(b) Each EGF within an electric power generating system, as 

defined in §117.10 ofthis title (relating to Definitions), that is subject 

to § 117.121 O(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 of both paragraphs (1) and (2) of this 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 of the following methods to provide substitute emissions compliance data during periods when the NOx monitor is off-line: 

(1) if the NO, monitor is a continuous emissions monitoring system (CEMS): 

(A) subject to 40 Code of Federal 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, AppendLx E, §2.5 

(Missing Data Procedures); 

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

(3) if the NO, 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 §117.81IO(b) 

of this 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 

of total 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 of this title (relating to Notification, Recordkeeping, andReporting Requirements). 

(g) The owner or operator shall report any exceedance of the 

system cap emission limit within 48 hours to the appropriate regional 

office. The owner or operator shall then follow up within 21 days 

of the exceedance with a written report to the regional office that includes an analysis of the cause for the exceedance with appropriate 

data to demonstrate the amount of emissions in excess of the 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 of this title (relating to Compliance Schedule for HoustonGalveston-Brazoria Ozone Nonattainment Area Utility Electric Generation Sources). 

PROPOSED RULES October 21,2011 36 TexReg 7145 
(i) An EGF that 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, 2000. 

The system cap emission limit is calculated in accordance with subsection (b) of this section. 

G) Emission reductions from shutdowns or curtailments that 

have been used for netting or offset purposes under the requirements 

of Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification) may not be included in the 

baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission limit, the contribution of each affected EGF that is 

operating during a startup, shutdown, or emissions event as defined in 

§ 101.1 of this title (relating to Definitions) must be calculated from the 

NO, emission rate measured by the NO, monitor, if operating properly. If the NO, monitor is not operating properly, the substitute data 

procedures identified in subsection (e) of this 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 of compliance, unless the owner 

or operator provides data demonstrating to the satisfaction of the 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 of NO, 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 of this title (relating to Use of Emission Credits 

for Compliance) or Chapter 101, Subchapter H, Division 1 or 4 [;- 4-, 

BF ~] of this title (relating to Emission Credit Banking and Trading; 

and Discrete Emission Credit Banking and Trading[t and System Gaf) 

-+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 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 of the Secretary of State 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 com36 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 of this 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 of this section. 

(b) Each unit within an electric power generating system, as 

defined in§ 117.10 of this 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) For each operating unit, the owner or operator shall use one 

of the following methods to provide substitute emissions compliance 

data during periods when the NO, monitor is off-line: 

(1) if the NO, monitor is a continuous emissions monitoring system (CEMS): 

(A) subject to 40 Code of Federal 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 

§117.3040(e) of this title; 

(3) if the NO, 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) 

of this title (relating to Emission Monitoring System Requirements for 

Utility Electric Generation Sources); or 

( 4) use the maximum emission rate as measured by the testing conducted in accordance with §117.3035(d) of this title (relating to 

Initial Demonstration of Compliance). 

(f) The owner or operator of any unit subject to a system cap 

shall maintain daily records indicating the NO, emissions and fuel usage from each unit and summations of total 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 of this title (relating to 

Notification, Recordkeeping, and Reporting Requirements). 

(g) The owner or operator of any unit subject to a system cap 

shall submit annual reports for the monitoring systems in accordance 

with § 117.3045 of this title. The owner or operator shall also report 

any exceedance of the system cap emission limit in the annual report 

and shall include an analysis of the cause for the exceedance with appropriate data to demonstrate the amount of emissions in excess of the 

applicable limit and the necessary corrective actions taken by the company to assure future compliance. 

(h) The owner or operator of any unit subject to a system cap 

shall demonstrate initial compliance with the system cap in accordance 

with the schedule specified in§ 117.9300 of this 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) of this section. 

(j) Emission reductions from shutdowns or curtailments that 

have been used for netting or offset purposes under the requirements 

of Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification) may not be included in the 

baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission limit, the contribution of each affected unit that is 

operating during a startup, shutdown, or emissions event as defined in 

§ 101.1 of this title (relating to Definitions) must be calculated from the 

NO, emission rate measured by the NOx monitor, if operating properly. If the NOx monitor is not operating properly, the substitute data 

procedures identified in subsection (e) of this section must be used. If 

neither the NOx monitor nor the substitute data procedure are operating 

properly, the owner or operator shall use the maximum daily rate measured during the initial demonstration of compliance, unless the owner 

or operator provides data demonstrating to the satisfaction of the 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 of a source ofNOx in any of the east 

and central Texas attainment counties listed in §117.3000(a)( 4) of this 

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 of Chapter 101, Subchapter H, Division 1 or 4 [-,4,&~] of this 

title (relating to Emission Credit Banking and Trading; and Discrete 

Emission Credit Banking and Trading[t -aOO System Gap .'I'fad.i.llg]). 

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 of the Secretary of State 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), §§7 401, 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 7147 
The 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 of a unit not subject to Chapter I OI, 

Subchapter H, Division 3 of this title (relating to Mass Emissions Cap 

and Trade Program) may meet emission control requirements of the 

sections specified in paragraphs (I)- (8) of this subsection, in whole 

or in part, by obtaining 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 IOI, Subchapter H, Division I or 4 of this 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 of this title (relating to Emission Specifications for Reasonably Available Control Technology (RACT)); 

(2) §§ 117.110, 117.210, 117.I 0 IO, or 117.1110 of this title 

(relating to Emission Specifications for Attainment Demonstration); 

(3) §§ 117.1015, II7.1115, or 117.I2I5 of this title (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 of this 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 of this 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 of this 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 user of the RCs to obtain additional RCs in accordance with Chapter 

101, Subchapter H, Division 1 or 4 of this title and/or otherwise reduce 

emissions prior to the effective date of such rule change. For units 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 of this title (relating to Revision of Final Control Plan) to 

revise the basis for compliance with the emission specifications of this 

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, but no later than 90 days prior 

to the effective date of the new, more stringent rule. The owner or operator of the 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 of the Secretary of State 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 ASSISNT 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 the foll wing sections proposed for repeal 

will not be published. The sections ay be examined in the offices of the 

Department of Aging and Disabili 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 of a 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 of Public 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 of Air Pollution by Permits 

for New Construction or Modific tion, and corresponding revisions to 

the state implementation plan (S P) under the requirements of Texas 

Health and Safety Code, §382.01 ; Texas Government Code, Chapter 

2001, Subchapter B; and 40 Co of Federal Regulations §51.102 of 

the United States Environmental rotection Agency (EPA) concerning 

SIPs. 

The proposed rulemaking would plement §4.27 and §4.30 of House 

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 of oral or written comments by interested persons. Individuals rna present oral statements when called 

upon in order of registration. 0 en discussion will not be permitted 

during the hearipg; however, com ission staff members 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 of Legal 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 of Public 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 of Air Pollution from Nitrogen Compounds, and corresponding revisions to the state implementation plan (SIP) under the 

requirements of Texas Health and Safety Code, §382.017; Texas Government Code, Chapter 2001, Subchapter B; and 40 Code of Federal 

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 Cap rules, would be amended to remove references to 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 of oral 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 of registration. 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 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 Charlotte Hom, Texas Register 

Team, Office of Legal 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 of Water 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 of the Chief Clerk, 

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 
Bryan W. Shaw, Ph.D., Chairman 

Buddy Garcia, Commissioner 

Carlos Rubinstein, Commissioner 

Mark R. Vickery, P.G., Executive Director 

TEXAS COMMISSION ON ENVIRONMENTAL QUALITY 

Protecting Texas by Reducing and Preventing Pollution 

NOTICE OF PUBLIC HEARINGS BYTIIE 

TEXAS COMMISSION ON ENVIRONMENTAL QUALI1Y 

ON PROPOSED REVISIONS TO 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 of Air Pollution From Nitrogen Compounds, and corresponding 

revisions to the state implementation plan (SIP) under the requirements of Texas 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 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 Cap rules, 

would be amended to remove references to 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 6:00p.m. in Conference Room Cat 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 201S, at the 

commission's central office located at 12100 Park 35 Circle. The hearings will be structured for 

the receipt of oral 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 of registration. 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 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 Charlotte Horn, Texas Register Team, Office of Legal 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:jjwwws.tceq.texas.govjrulesjecommentsj. 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 rules can be obtained from the commission's Web site at 

http:/ jwww.tceq .texas.govjnavjrulesjpropose_ adopt.html. For further 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 Jeff Robinson, United States Environmental Protection Agency 
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

REGION6 

Ms. Charlotte Hom 

Texas Register Team (MC 205) 

Office of Legal Services 

1445 ROSS AVENUE, SUITE 1200 

DALLAS TX 75202-2733 

NOV 0 1 2011 

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 opportunity to review and comment on the proposed revisions to 30 TAC, 

Chapters 101 and 117. These revisions propose the repeal of all 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 of the SCT Program and all associated cross-references to the SCT 

Program as proposed. We believe the repeal of these provisions will clarify the available 

compliance options for electric generating units in Texas. 

We appreciate the timely efforts of the TCEQ to repeal this program, consistent with the 

March 4, 2011, letter. If you have any questions about our comments today, please feel free 

to contact me at (214) 665-6435 or contact Ms. Adina Wiley of my staff at (214) 665-2115. 

V~l?~ Jeff Robinson 

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-Galveston Area Council 

NO ORAL TESTIMONY WAS RECEIVED PERTAINING TO THIS RULE REVISION. 

November 15, 2011, 6:oop.m. - Houston-Galveston Area Council 

NO ORAL TESTIMONYW AS RECEIVED PERTAINING TO THIS RULE REVISION. 

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

NO ORAL TESTIMONYW AS RECEIVED PERTAINING TO THIS RULE REVISION. 
- 1 -

Texas Commission on Environmental Quality 

Public Hearing Registration 

Date: November 15,2011 

Time: 1:30PM 

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

Short Title: Repeal of Chapter 101 System Cap Trading Rules and Revisions to Chapter 117 

Location: Conference Room C at the Houston-Galveston Area Council located at 3555 Timmons Lane 

Concerning: Proposed Revisions to 30 TAC Chapters 101 and 117 and to the State Implementation Plan 

/ 0c; 

Name and Phone No. or E-mail Address {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 
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 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 staff and a court reporter were present 

and ready 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 not formally opened for comment and a transcript was not prepared. 

Hearing Officer 

Date sign d 
- 1 -

Texas Commission on Environmental Quality 

Public Hearing Registration 

Date: November 15,2011 

Time: 6:ooPM 

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

Short Title: Repeal of Chapter 101 System Cap Trading Rules and Revisions to Chapter 117 

Location: Conference Room Cat the Houston-Galveston Area Council located at 3555 Timmons Lane 

Concerning: Proposed Revisions to 30 TAC Chapters 101 and 117 and to the State Implementation Plan 

Name and Phone No. or E-mail Address ~g Presenting Oral Testimony? 

(Please Print) (Circle One) 

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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 

and ready 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 not formally opened for comment and a transcript was not prepared. 

Hea~~-

Date signed 
···-···-···· ~~---••••--•-•·•···-·-- ··-···••••-•••-··-····--·-··•·•--•••--•·., M•o •·••·· 0. •• ··-·-·------~--.. ··-··--· ····-·•· •·••• •"• .~··~··••••w.-·-••··---------------7_,-• --•••- -·-··----.....,....------

- 1 -

Texas Commission on Environmental Quality 

Public Hearing Registration - November 1h 2011 

2:oop.m. 

Rule ProjectNo.:2011-018-lo1-EN 

Short Title: Repeal of Chapter 101 System Cap Trading Program Rules and Revisions to Chapter 117 

Location: TCEQ complex, 12100 Park 35 Circle, Austin Texas, Building E, Room 2018 

Concerning: System Cap Trading Program ~ 

Name Representing Presenting Oral Testimony? 

(Please Print) (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 
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 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 staff and a court reporter were present 

and ready 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 

Interoffice Memorandum 

To: Commissioners Date: February 4, 2011 

Thru: LaDonna Castafiuela, Chief Clerk 

Mark R. Vickery, P.G. Executive Director 

From: Susana M. Hildebrand, P.E., Chief Engine~ 

Docket No.: 2010-1983-MIS 

Subject: Commission Approval for Withdrawal of Title 30 Texas Administrative , 

Code §§101.380, 101.382, 101.383, and 101.385, System Cap Trading from 

the United States Environmental Protection Agency's (EPA) Consideration 

as a Revision to the State Implementation Plan (SIP) 

Background and reason(s) for the rulemaking: 

Title 30 Texas Administrative Code (TAC) §§101.380, 101.382, 101.383, and 101.385 as 

adopted on March 21, 2001, and amended on July 25, 2007, are included in the revisions 

to the SIP. These sections specify the requirements of the System Cap Trading (SCT) 

Program, created to provide additional flexibility to facilities with system cap emission 

limits specified in 30 TAC Chapter 117. 

The sections were submitted to the EPA as revisions to the SIP on May 1, 2001, and the 

amendments to §101.383. and §101.385, were submitted to the EPA as revisions to the SIP 

on August 16, 2007. On October 25, 2010, the EPA, which is under a consent decree· 

· deadline that requires final action on the SCT Program by December 31, 2010, sent a letter 

to the commission requesting revisions to the program. The October 25, 2010, letter from 

the EPA also stated its intent to take favorable action on the SCT Program if the Texas 

Commission on Environmental Quality (TCEQ) agreed to commit to a rulemaking action to 

implement the EPA's requested revisions. 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 submitted a letter in response to the EPA's 

request stating that due to the short timeline, the TCEQ would be unable to present the 

EPA's requested revisions to the commission, and the commission would be unable to take 

any action to implement these revisions on the EPA's proposed timeline. The letter also 

stated the Executive Director's intention to seek approval from the commission to 

withdraw the SCT Program from the EPA's consideration based on a preliminary review of 

the program that indicated minimal participation by affected sources. In addition, affected 

sources have alternative means of compliance with the system cap emission limits of 

Chapter 117 in the form of the Emission Credit Banking and Trading Program and the 

Discrete Emission Credit Banking and Trading Program. ,On November 18,2010, the EPA 

published its proposed disapproval of the SCT Program in the Federal Register (75 FR 

70654). The EPA has received an extension until May 30, 2011, to take final action on the 

SCT Program. 
Commissioners 

Page2 

February 4, 2011 

Re: Docket No. 2010-1983-MIS 

Staff recommends removing from consideration by the EPA as a revision to the SIP 

§§101.380, 101.382, 101.383, and 101.385 which contain the requirements of the SCT 

Program and were created to provide additional flexibility to facilities with system cap 

emission limits specified in §§117.320, 117.1020, 117.1120, 117.1220, and 117.3020. The 

program allows source owners to trade surplus emission allowables within a single 

nonattainment area or within another single area with unique emission limits as identified 

in Chapter 117. 

Sections 101.380, 101.382, 101.383-, and 101.385 are proposed for disapproval by the EPA, 

and the EPA is subject to a settlement agreement that requires final action by May 30, 

2011. It is therefore. recommended that §§101.380, 101.382, 101.383, and 101.385 be 

removed from the EPA's consideration as a SIP revision prior to the EPA taking final action 

to disapprove the rules. 

Scope of the recommendation: 

A.) Summary of what the rulemaking will do: If approved, a request will be made to 

the EPA to remove §§101.380, 101.382, 101.383, and 101.385 from consideration as a 

revision to the SIP. 

B.) Scope required by federal regulations or state statutes: No. 

C.) Additional staff recommendations that are not required by federal rule or 

state statute: · 

• remove §§101.380, 101.382, 101.383, and 101.385 from consideration by the EPA as 

a revision to the SIP; and 

• initiate rulemaking at a later time to remove the SCT Program and any references to 

the SCT Program in Chapter 117.· 

Statutory authority: 

Texas Clean Air Act, Texas Health and Safety Code, §382.011, relating to General Powers 

and Duties; §382.012, State Air Control Plan; §382.014; relating to Emission Inventory; 

§382.016, relating to Monitoring Requirements; Examination of Records; and §382.017, 

Rules. · 

Effect on the: 

A.) Regulated community: No impact is expected. There has been minimal 

participation in the SCT Program by the regulated community due to the availability of 

alternative compliance means such as the use of Emission Credit Banking and Trading 

Program and the Discrete Emission Credit Banking and Trading Program. 

B.) Public: No direct fiscal impact is anticipated to the public. 

C.) Agency programs: A rulemaking project to remove the SCT Program and any 

references to the program in Chapter 117 should be completed as soon as practicable. 
Commissioners 

Page3 

February 4, 2011 

Re: Docket No. 2010-1983-MIS 

Stakeholder meetings: 

Not Applicable 

Potential controversial concerns and legislative interest: 

If the SCT Program is repealed, the compliance options available to the regulated 

community.will become limited, especially if the regulated community does not have 

access to the required Discrete Emission Credits or Emission Credits to meet the system 

cap emission limits specified in Chapter 117. 

Will this rulemaking affect any current policies or require development of 

new policies? Future rulemaking will be required to remove the SCT Program and any 

references to the program in Chapter 117. 

What are the consequences if this recommendation does not go forward? Are 

there alternatives to this recommendation? 

The EPA has already published a proposed disapproval of the SCT Program (75 FR 70654). 

If request to withdraw the SCT Program from the EPA's consideration does not go forward, 

the EPA will issue a final disapproval of the SCT Program. The rules pertaining to the SCT 

Program will have to be repealed or revised and resubmitted to the EPA, and rules in 

Chapter 117 will need to be revised to reflect this repeal. However, the EPA has stated that 

since the SCT Program was not submitted to meet a mandatory requirement of the Federal 

Clean Air Act, no sanctions and Federal Implementation Program timelines will be 

initiated (75 FR 70656). 

Agency contacts: 

Shantha Daniel, Ph.D., Project Manager, 239-3930, Air Quality Division 

Amy Browning, Staff Attorney, 239-0891 

Attachments 

cc: Chief Clerk, 2 copies 

Executive Director's Office 

Susana M. Hildebrand, P .E. 

Kevin Patteson 

Curtis Seaton 

Ashley Morgan 

Office of General Counsel 

Shantha Daniel, 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 the proposed text as published in the October 

21, 2011, issue of the Texas Register (36 TexReg 7124). 

Background and Summary of the 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-GalvestonBrazoria 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, Lama~;, 

Limestone, Marion, McLennan, Milam, Morris, Nueces, Parker, Red River, Robertson, Rusk, 

Titus, Travis, Victoria, and Wharton. 

1 
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, if company 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 of an 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 owners 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 of emissions in a 

Chapter 117 system cap emission limit and the actual emissions from that electric power 

generating system. Trading of surplus emissions allowables 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 

2 
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). 

3 
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 of 

this withdrawal in a letter dated March 4, 2011. The EPA acknowledged the withdrawal of the 

Chapter 101 SCT program rules from consideration as a SIP revision in a letter received by the 

commission on Apri14, 2011, and published its withdrawal of the proposed disapproval of the 

SCT program rules in the AprilS, 2011, issue of the 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 of the 

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 emission 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. 

4 
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 of the economy, productivity, 

competition, jobs, the environment, or the public health and safety of the 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 

of the 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 not federally 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 of the economy, 

5 
productivity, competition, jobs, the environment, or the public health and safety of the state or a 

sector of the state. 

Additionally, the repeal 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 

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 under the general powers of the agency, but is authorized by specific 

sections of Texas Health and Safety Code, Chapter 382 (also known as the Texas Clean Air Act), 

and the Texas Water Code, which are cited in the Statutory Authority section of this rulemaking. 

Therefore, this repeal is not subject to the regulatory analysis provisions of Texas Government 

Code, §2001.0225(b). 

6 
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 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 of the 

property determined as if the governmental action is in effect. 

The commission completed a takings impact analysis for the adopted repeal under Texas 

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 manner that would 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 

7 
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 TAC §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 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 this 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 

8 
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. 

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 TAC 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 of the repeal of the 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. 

9 
The commission appreciates the support and makes no changes to the rule based on this 

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 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 of the Factual Basis for the Adopted 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 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 

1 
in §117.10(14). For example, if company 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 of an 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 eighthour 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-GalvestonBrazoria 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, 

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, and Wharton. The adopted rules also made clear that EQ-Fs 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 §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 of the Chapter 101 SCT program rules from 

consideration by the EPA as a revision to the SIP. The EPA was notified of this withdrawal in a 

letter dated March 4, 2011. While the repeal of the 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 of the 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 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 adopted 

concurrently with the repeal of sections pertaining to the SCT program from Chapter 101. The 

3 
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 adopted rulemaking 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 by removing references to 

Chapter 101 SCT program rules. The adopted rulemaking will also include various nonsubstantive revisions to these sections to conform to current Texas Register style 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), ~nd 117.3020(1) remove all 

references to Chapter 101, Subchapter H, Division 5, SCT program. 

§117.9800, Use of Emission 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 Impact Analysis 

The commission reviewed the adopted rulemaking in light of the regulatory impact analysis 

requirements of the Texas Government Code, §2001.0225, and determined that the adopted 

4 
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 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 of the economy, productivity, 

competition, jobs, the environment, or the public health and safety of the state or a sector of the 

state. The purpose of the adopted rulemaking is to remove the references to the Chapter 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 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. 

Additionally, the adopted rule making 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 

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. 

5 
The requirement to provide a fiscal analysis of the adopted 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 of the 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 

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 

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 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 

6 
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 of the FCAA. For these 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); 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. 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 (AP A) by the legislature 

in 1999. In an attempt to limit the number of rule challenges based upon AP A requirements, the 

7 
legislature clarified that state agencies are required to meet these sections of the AP A 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 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 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 not federally enforceable might be used to meet a federally enforceable 

rule. This rulemaking action does not exceed an express requirement of state law or a 

requirement of a delegation agreement, and was not developed solely under the general powers 

of the 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. 

8 
TakingslrnpactAssessrnent 

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 of a reduction of at least 25% in 

the m~rket 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 of the 

property determined as if the 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 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 under the United States Constitution or 

the 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 

9 
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 et seq., 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 

10 
§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 Chapter 122, Federal Operating Permits 

Program. 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 of these facilities will have the option of initiating a permit action or waiting 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 of the rulemaking. 

Response to Comments 

The EPA stated its support of the repeal of the 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. 

11 
The commission appreciates the comment and the support. No changes were made to the rule 

based on this comment. 

12 
RECOMMENDATION 
SUBCHAPTER H: EMISSIONS BANKING AND TRADING 

[DIVISION 5: SYSTEM CAP TRADING] 

[§§101.380, 101.382, 101.383, 101.385] 

Statutory Authority 

The repeals are 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, §5.103, 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 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 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 adopted repeals implement TWC, §§5.102, 5.103, and 5.105; and THSC, §§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 
SUBCHAYfER 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 

§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, §5.103, 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 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 

1 
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, §§5.102, 5.103, and 5.105; THSC, §§382.002, 

382.011, 382.012, 382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq. 

§117.102o.System Cap. 

(a) An owner or operator of an electric generating facility (EGF) may achieve 

compliance with the nitrogen oxides (NOx) emission specifications of §117.1010 of this 

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 of this section. 

(b) Each EGF within an electric power generating system, as defined in §117.10 of 

this title (relating to Definitions), that would otherwise be subject to the NOx emission 

rates of §117.1010 of this title must be included in the system cap. 

(c) The system cap must be calculated as follows. 

2 
(1) A rolling 30-day average emission cap must be calculated using the 

following equation. 

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

N 

Cap30day = L (Ht X Rt) 

i=l 

Where: 

Cap3oday = the NOx 30-day rolling 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 of the daily heat input for each EGF in the emission cap, in million British 

thermal units per day, as certified to the executive director, for the system highest 30-

day period in the nine months of July, August, and September 1996, 1997, and 1998. 

For an EGF exempt from the 40 Code of Federal Regulations (CFR) Part 75 monitoring 

requirements, ifthe heat input data corresponding to the system highest 30-day period 

(as determined for an EGF in the system subject to 40 CFR Part 75 monitoring) is not 

available, the daily average of the highest calendar month heat input in 1996 - 1998 

may be used; and 

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

(2) A maximum daily cap must be calculated using the following equation. 

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

N 

Cap daily = L (Hmi xRi) 

i=l 

Where: 

3 
Capdaily = the NOx maximum daily cap in pounds per day; 

i = as defined in paragraph (1) of this subsection; 

N = as defined in paragraph (1) of this subsection; 

Hmi = the maximum daily heat input, as certified to the executive director, allowed 

or possible (whichever is lower) in a day; and 

& = as defined in paragraph (1) of this subsection. 

(3) Each EGF in the system cap is subject to the emission limits of both 

paragraphs (1) and (2) of this 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 owner or operator shall use one of the following 

methods to provide substitute emissions compliance data during periods when the NOx 

monitor is off-line: 

(1) if the NOx monitor is a continuous emissions monitoring system 

(CEMS): 

(A) subject to 40 Code of Federal Regulations (CFR) Part 75, use the 

missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data 

Substitution Procedures); or 

4 
(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 §117.1040(d) of this 

title; 

(3) if the 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 §117.8no(b) of this title 

(relating to Emission Monitoring System Requirements for Utility Electric Generation 

Sources); or 

(4) use the maximum block one-hour emission rate as measured by the 30-

day testing. 

(f) The owner or operator of any EGF subject to a system cap shall maintain daily 

records indicating the NOx emissions and fuel usage from each EGF and summations of 

total NOx emissions and fuel usage for all EGFs under the system cap on a daily basis. 

Records must also be retained in accordance with §117.1045 of this title (relating to 

Notification, Recordkeeping, and Reporting Requirements). 

5 
(g) The owner or operator of any EGF subject to a system cap shall report any 

exceedance of the system cap emission limit within 48 hours to the appropriate regional 

office. The owner or operator shall then follow up within 21 days of the exceedance with 

a written report to the regional office that includes an analysis of the cause for the 

exceedance with appropriate data to demonstrate the amount of emissions in excess of 

the 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 §117.1045 of this 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 

§117.9100 ofthis title (relating to Compliance Schedule for Beaumont-Port Arthur 

Ozone Nonattainment Area Utility Electric Generation Sources). 

(i) An EGF that 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 1, 1999. The system cap emission limit is 

calculated in accordance with subsection (b) of this section. 

G) Emission reductions from shutdowns or curtailments that have been used for 

netting or offset purposes under the requirements of Chapter 116 of this title (relating to 

6 
Control of Air Pollution by Permits for New Construction or Modification) may not be 

included in the baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission 

limit, the contribution of each affected EGF that is operating during a startup, 

shutdown, or emissions event as defined in §101.1 of this title (relating to Definitions) 

must be calculated from the NOx emission rate measured by the NOx monitor, if 

operating properly. If the NOx monitor is not operating properly, the substitute data 

procedures identified in subsection (e) of this section must be used. If neither the NOx 

monitor nor the substitute data procedure are operating properly, the owner or operator 

shall use the maximum daily rate measured during the initial demonstration of 

compliance, unless the owner or operator provides data demonstrating to the 

satisfaction of the executive director and the United States Environmental Protection 

Agency that actual emissions were less than maximum emissions during such periods. 

(1) An owner or operator of a source of NOx 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 of this title (relating to Use of Emission 

Credits for Compliance) or Chapter 101, Subchapter H, Division 1 or 4 of this title 

(relating to Emission Credit Banking and Trading; and Discrete Emission Credit 

Banking and Trading). 

7 
(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. 

8 
SUBCHAPTER C: COMBUSTION CONTROL AT MAJOR UTILI1Y ELECTRIC 

GENERATION SOURCES IN OZONE NONATTAINMENT AREAS 

DIVISION 2: DALLAS-FORT WORTH OZONE NONATTAINMENT AREA 

UTILI1Y ELECTRIC GENERATION SOURCES 

§117.1120 

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, §5.103, 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 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, 

§382.0.16, 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 

9 
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, §§5.102, 5.103, and 5.105; THSC, §§382.002, 

382.011,382.012,382.016,382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq. 

§117.1120. System Cap. 

(a) An owner or operator of an electric generating facility (EGF) may achieve 

compliance with the nitrogen oxides (NOx) emission specifications of §117.1110 of this 

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 of this section. 

(b) Each EGF within an electric power generating system, as defined in §117.10 of 

this title (relating to Definitions), that would otherwise be subject to the NOx emission 

rates of §117.1110 of this title must be included in the system cap. 

(c) The system cap must be calculated as follows. 

10 
(1) A rolling 30-day average emission cap must be calculated using the 

following equation. 

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

Where: 

N 

Cap3odo.y = L (Hi x Ri) 

1=1 

Cap3oday = the NOx 30-day rolling average emission cap in pounds per day; 

i =each EGF in the electric power generating system; 

N = the total number of EGFs in the emission cap; 

Hi = the average of the daily heat input for each EGF in the emission cap, in million British 

thermal units per day, as certified to the executive director, for the system highest 30-

day period in the nine months of July, August, and September 1996, 1997, and 1998. 

For an EGF exempt from the 40 Code of Federal Regulations (CFR) Part 75 monitoring 

requirements, if the heat input data corresponding to the system highest 30-day period 

(as determined for an EGF in the system subject to 40 CFR Part 75 monitoring) is not 

available, the daily average of the highest calendar month heat input in 1996- 1998 

may be used; and 

Ri =the emission specification of §117.1110(a) of this title. 

(2) A maximum daily cap must be calculated using the following equation. 

Figure: 30 TAC §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) of this subsection; 

N = as defined in paragraph (1) of this subsection; 

Hmi =the maximum daily heat input, as certified to the executive director, 

allowed or possible (whichever is lower) in a day; and 

Ri = as defined in paragraph (.1) of this subsection. 

(3) Each EGF in the system cap is subject to the emission limits of both 

paragraphs (1) and (2) of this subsection at all times. 

(d) The NOx 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 of the following 

methods to provide substitute emissions compliance data during periods when the NOx 

monitor is off-line: 

(1) if the NOx monitor is a continuous emissions monitoring system 

(CEMS): 

(A) subject to 40 Code of Federal Regulations (CFR) Part 75, use the 

missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data 

Substitution Procedures); or 

12 
(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) of this 

title; 

(3) if the 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 §117.811o(b) ofthis title 

(relating to Emission Monitoring System Requirements for Utility Electric Generation 

Sources); or 

(4) if the methods specified in paragraphs (1) - (3) of this 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 of any EGF subject to a system cap shall maintain daily 

records indicating the NOx emissions and fuel usage from each EGF and summations of 

total NOx emissions and fuel usage for all EGFs under the system cap on a daily basis. 

13 
Records must also be retained in accordance with §117.1145 of this title (relating to 

Notification, Recordkeeping, and Reporting Requirements). 

(g) The owner or operator of any EGF subject to a system cap shall report any 

exceedance of the system cap emission limit within 48 hours to the appropriate regional 

office. The owner or operator shall then follow up within 21 days of the exceedance with 

a written report to the regional office that includes an analysis of the cause for the 

exceedance with appropriate data to demonstrate the amount of emissions in excess of 

the 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 of this 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 

§117.9110 of this title (relating to Compliance Schedule for Dallas-Fort Worth Ozone 

Nonattainment Area Utility Electric Generation Sources). 

(i) An EGF that 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 1, 1999. The system cap emission limit is 

calculated in accordance with subsection (b) of this section. 

14 
G) Emission reductions from shutdowns or curtailments that have been used for 

netting or offset purposes under the requirements of Chapter 116 of this title (relating to 

Control of Air Pollution by Permits for New Construction or Modification) may not be 

included in the baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission 

limit, the contribution of each affected EGF that is operating during a startup, 

shutdown, or emissions event as defined in §101.1 of this title (relating to Definitions) 

must be calculated from the NOx emission rate measured by the NOx monitor, if 

operating properly. If the NOx monitor is not operating properly, the substitute data 

procedures identified in subsection (e) of this section must be used. If neither the NOx 

monitor nor the substitute data procedure are operating properly, the owner or operator 

shall use the maximum daily rate measured during the initial demonstration of 

compliance, unless the owner or operator provides data demonstrating to the 

satisfaction of the executive director and the United States Environmental Protection 

Agency that actual emissions were less than maximum emissions during such periods. 

0) An owner or operator of a source of NOx 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 of this title (relating to Use of Emission 

Credits for Compliance) or Chapter 101, Subchapter H, Division 1 or 4 of this title 

(relating to Emission Credit Banking and Trading; and Discrete Emission Credit 

Banking and Trading). 

15 
(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. The value Ri in 

this section is based on the unit's status as part of a large or small system as of January 

1, 2000, and does not change as a result of sale or transfer of the unit, regardless of the 

size of the transferee's system. 

16 
SUBCHAPTER C: COMBUSTION CONTROL AT MAJOR UTILITY ELECTRIC 

GENERATION SOURCES IN OZONE NONATTAINMENT AREAS 

DIVISION 3: HOUSTON-GALVESTON-BRAZORIA OZONE 

NONATTAINMENT AREA UTILITY ELECTRIC GENERATION SOURCES 

§117.1220 

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, §5.103, 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 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 

17 
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, §§5.102, 5.103, and 5.105; THSC, §§382.002, 

382.011,382.012,382.016,382.017, and 382.021; and FCAA, 42 USC, §§7401 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 (NOx) emission limitation in 

accordance with the requirements of this section. 

(b) Each EGF within an electric power generating system, as defined in §117.10 of 

this title (relating to Definitions), that is subject to §117.1210(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. 

18 
(1) A rolling 30-day average emission cap must be calculated using the 

following equation. 

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

.LV 

Cap30daJ! = L (Ht x Rt) 

i=l 

Where: 

Cap3oday = the NOx 30-day rolling average emission cap in pounds per day; 

i =each EGF in the electric power generating system; 

N = the total number of EGFs in the emission cap; 

Hi = (A) the average of the daily heat input for each EGF in the emission cap, in million 

British thermal units per day, as certified to the executive director, for any system 

30-day period in the nine months of July, August, and September 1997, 1998, and 

1999; 

(B) for an EGF exempt from the 40 Code of Federal Regulations (CFR) Part 75 

monitoring requirements, if the heat input data corresponding to any system 30-day 

period (as determined for an EGF in the system subject to 40 CFR Part 75 

monitoring) is not available, the daily average of the highest calendar month heat 

input in 1997- 1999 may be used; 

(C) the level of activity authorized by the executive director for the third quarter (July, 

August, and September), until such time two consecutive third quarters of actual 

level of activity data are available, must be used for the following: 

(i) an EGF that the owner or operator has submitted, under Chapter 116 of this title 

(relating to Control of Air Pollution by Permits for New Construction or 

Modification), an application determined to be administratively complete by 

the executive director before January 2, 2001; 

(ii) an EGF that qualifies for a permit by rule under Chapter 106 of this title 

(relating to Permits by Rule) and has commenced construction before January 

2, 2001; and 

(iii) an EGF that was not in operation before January 1, 1997; 

(D) after two consecutive third quarters of actual level of activity data are available for 

an EGF described in subsection (c)(1) ofthis section, variable (C) of this figure, the 

owner or operator may calculate the baseline as the average of any two consecutive . 

19 
third quarters in the first five years of operation. The five-year period begins at the 

end of the adjustment period as defined in §101.350 of this title (relating to 

Definitions); and 

(E) in extenuating circumstances, the owner or operator of an EGF may request, subject 

to approval of the executive director, up to two additional calendar years to 

establish the baseline period described in subsection (c)(1) of this section, variables 

(A)- (D) ofthis figure. Applications seeking an alternate baseline period must be 

submitted by the owner or operator of the EG F to the executive director: 

(i) no later than December 31, 2001; or 

(ii) for an EGF that the baseline period as described in subsection (c)(1) of this 

section, variables (A)- (D) of this figure is not complete by December 31, 

2001, no later than 90 days after completion of the baseline period; and 

Ri =the emission specification of §117.1210(a) ofthis title. 

(2) A maximum daily cap must be calculated using the 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) of this subsection; 

N = as defined in paragraph (1) of this subsection; 

Hmi =the maximum daily heat input, as certified to the executive director, allowed or possible 

(whichever is lower) in a day; and 

Ri = as defined in paragraph (1) of this subsection. 

(3) Each EGF in the system cap is subject to the emission limits of both 

paragraphs (1) and (2) of this subsection at all times. 

20 
(d) The NOxemissions monitoring required by §117.1240 ofthis 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 of the following 

methods to provide substitute emissions compliance data during periods when the NOx 

monitor is off-line: 

(1) if the NOx monitor is a continuous emissions monitoring system 

(CEMS): 

(A) subject to 40 Code of Federal 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 40 CFR Part 75, Appendix E monitoring in accordance with 

§117.1240(e) of this title; 

(3) if the NOx monitor is a predictive emissions monitoring system 

(PEMS): 

21 
(A) use the methods specified in 40 CFR Part 75, Subpart D; or 

(B) use calculations in accordance with §117.811o(b) of this title 

(relating to Emission Monitoring System Requirements for Utility Electric Generation 

Sources); or 

(4) if the methods specified in paragraphs (1)- (3) of this 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 NOx 

emissions and fuel usage from each EGF and summations of total 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 of this title (relating to Notification, 

Recordkeeping, and Reporting Requirements). 

(g) The owner or operator shall report any exceedance of the system cap emission 

limit within 48 hours to the appropriate regional office. The owner or operator shall 

then follow up within 21 days of the exceedance with a written report to the regional 

office that includes an analysis of the cause for the exceedance with appropriate data to 

demonstrate the amount of emissions in excess of the applicable limit and the necessary 

corrective actions taken by the company to assure future compliance. Additionally, the 

22 
owner or operator shall submit semiannual reports for the monitoring systems in 

accordance with §117.1245 of this title. 

(h) The owner or operator shall demonstrate initial compliance with the system 

cap in accordance with the schedule specified in §117.9120 of this title (relating to 

Compliance Schedule for Houston-Galveston-Brazoria Ozone N onattainment Area 

Utility Electric Generation Sources). 

(i) An EGF that 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 1, 2000. The system cap emission limit is 

calculated in accordance with subsection (b) of this section. 

G) Emission reductions from shutdowns or curtailments that have been used for 

netting or offset purposes under the requirements of Chapter 116 of this title (relating to 

Control of Air Pollution by Permits for New Construction or Modification) may not be 

included in the baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission 

limit, the contribution of each affected EGF that is operating during a startup, 

shutdown, or emissions event as defined in §101.1 of this title (relating to Definitions) 

must be calculated from the NOx emission rate measured by the NOx monitor, if 

operating properly. If the NOx monitor is not operating properly, the substitute data 

23 
procedures identified in subsection (e) of this section must be used. If neither the NOx 

monitor nor the substitute data procedure are operating properly, the owner or operator 

shall use the maximum daily rate measured during the initial demonstration of 

compliance, unless the owner or operator provides data demonstrating to the 

satisfaction of the executive director and the United States Environmental Protection 

Agency that actual emissions were less than maximum emissions during such periods. 

(1) An owner or operator of a source of NOx 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 of this title (relating to Use of Emission 

Credits for Compliance) or Chapter 101, Subchapter H, Division 1 or 4 of this title 

(relating to Emission Credit Banking and Trading; and Discrete Emission Credit 

Banking and Trading). 

(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. 

24 
SUBCHAPTER E: MULTI-REGION COMBUSTION CONTROL 

DIVISION 1: UTILITY ELECTRIC GENERATION IN EAST AND CENTRAL 

TEXAS 

§117.3020 

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, §5.103, 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 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 

25 
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, §§5.102, 5.103, and 5.105; THSC, §§382.002, 

382.011,382.012,382.016,382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq. 

§117.3020. System Cap. 

(a) An owner or operator may achieve compliance with the nitrogen oxides (NOx) 

emission specifications of §117.3010 of this title (relating to Emission Specifications) by 

achieving equivalent NOx emission reductions obtained by compliance with a system cap 

emission limitation in accordance with the requirements of this section. 

(b) Each unit within an electric power generating system, as defined in §117.10 of 

this title (relating to Definitions), that would otherwise be subject to the NOx 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) 
Cap a:nnll11l 

Where: 

Capannual = the NOx annual average emission cap in tons per year; 

i = each unit in the electric power generating system; 

N = the total number of units in the emission cap; 

Hi = the average of the annual heat input for each unit in the emission cap, in million British 

thermal units per year, as certified to the executive director, for 1996, 1997, and 1998; 

and 

Ri = the emission specification of §117.3010 of this title. 

(d) The NOxemissions 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) For each operating unit, the owner or operator shall use one of the following 

methods to provide substitute emissions compliance data during periods when the NOx 

monitor is off-line: 

(1) if the NOx monitor is a continuous emissions monitoring system 

(CEMS): 

(A) subject to 40 Code of Federal Regulations (CFR) Part 75, use the 

missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data 

Substitution Procedures); or 

27 
(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 §117.3040(e) of this 

title; 

(3) if the 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 §117.8no(b) of this title 

(relating to Emission Monitoring System Requirements for Utility Electric Generation 

Sources); or 

(4) use the maximum emission rate as measured by the testing conducted 

in accordance with §117.3035(d) of this title (relating to Initial Demonstration of 

Compliance). 

(f) The owner or operator of any unit subject to a system cap shall maintain daily 

records indicating the NOx emissions and fuel usage from each unit and summations of 

total NOx emissions and fuel usage for all units under the system cap on a daily basis. 

28 
Records must also be retained in accordance with §117.3045 of this title (relating to 

Notification, Recordkeeping, and Reporting Requirements). 

(g) The owner or operator of any unit subject to a system cap shall submit annual 

reports for the monitoring systems in accordance with §117.3045 of this title. The owner 

or operator shall also report any exceedance of the system cap emission limit in the 

annual report and shall include an analysis of the cause for the exceedance with 

appropriate data to demonstrate the amount of emissions in excess of the applicable 

limit and the necessary corrective actions taken by the company to assure future 

compliance. 

(h) The owner or operator of any unit subject to a system cap shall demonstrate 

initial compliance with the system cap in accordance with the schedule specified in 

§117.9300 of this 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) of this section. 

G) Emission reductions from shutdowns or curtailments that have been used for 

netting or offset purposes under the requirements of Chapter 116 of this title (relating to 

29 
Control of Air Pollution by Permits for New Construction or Modification) may not be 

included in the baseline for establishing the cap. 

(k) For the purposes of determining compliance with the system cap emission 

limit, the contribution of each affected unit that is operating during a startup, shutdown, 

or emissions event as defined in §101.1 of this title (relating to Definitions) must be 

calculated from the NOx emission rate measured by the NOx monitor, if operating 

properly. If the NOx monitor is not operating properly, the substitute data procedures 

identified in subsection (e) of this section must be used. If neither the NOx monitor nor 

the substitute data procedure are operating properly, the owner or operator shall use the 

maximum daily rate measured during the initial demonstration of compliance, unless 

the owner or operator provides data demonstrating to the satisfaction of the executive 

director and United States Environmental Protection Agency that actual emissions were 

less than maximum emissions during such periods. 

(1) An owner or operator of a source of NOx in any of the east and central Texas 

attainment counties listed in §117.3000(a)(4) of this 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 of Chapter 101, Subchapter H, Division 1 or 4 of this title (relating to 

Emission Credit Banking and Trading; and Discrete Emission Credit Banking and 

Trading). 

30 
SUBCHAYfER H: ADMINISTRATIVE PROVISIONS 

DIVISION 2: COMPLIANCE FLEXIBILI1Y 

§117.9800 

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, §5.103, 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 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 

31 
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, §§5.102, 5.103, and 5.105; THSC, §§382.002, 

382.011, 382.012, 382.016, 382.017, and 382.021; and FCAA, 42 USC, §§7401 et seq. 

§117.9800. Use of Emission Credits for Compliance.· 

(a) An owner or operator of a unit not subject to Chapter 101, Subchapter H, 

Division 3 of this title (relating to Mass Emissions Cap and Trade Program) may meet 

emission control requirements of the sections specified in paragraphs (1) - (8) of this 

subsection, in whole or in part, by obtaining 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 or 4 of this 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: 

32 
(1) §§117.105, 117.205, 117.305, 117.1005, 117.1105, or 117.1205 of this title 

(relating to Emission Specifications for Reasonably Available Control Technology 

(RACT)); 

(2) §§117.110, 117.210, 117.1010, or 117.1110 of this title (relating to 

Emission Specifications for Attainment Demonstration); 

(3) §§117.1015, 117.1115, or 117.1215 of this title (relating to Alternative 

System-Wide Emission Specifications); 

(4) §§117.115, 117.215, or 117.315 of this title (relating to Alternative PlantWide Emission Specifications); 

(5) §§117.123, 117.223, 117.323, 117-423, or §117.3120 of 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, 117.2110, or 117.3310 ofthis title (relating to 

Emission Specifications for Eight-Hour Attainment Demonstration); or 

33 
(8) §117.3123 of this 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 of this 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 101, Subchapter H, Division 1 or 4of this title, by obtaining an 

ERC, MERC, DERC, or MDERC, 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 of this section, the term "reduction credit (RC)" refers to an 

ERC, MERC, DERC, or MDERC, whichever is applicable. 

(d) Any lower nitrogen oxides (NOx) emission specification established under this 

chapter for the unit or units using RCs requires the user of the RCs to obtain additional 

RCs in accordance with Chapter 101, Subchapter H, Division 1 or 4 of this title and/ or 

otherwise reduce emissions prior to the effective date of such rule change. For units 

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, 117.1256, and 117.1356 of this title (relating to Revision of Final 

Control Plan) to revise the basis for compliance with the emission specifications of this 

34 
chapter. The owner or operator using the RCs shall submit the revised final control plan 

as soon as practicable, but no later than 90 days prior to the effective date of the new, 

more stringent rule. The owner or operator of the unit(s) currently using RCs shall 

calculate the necessary emission reductions per unit as follows. 

Figure: 30 TAC §117.98oo(d) (No change) 

M' = r. LA X (ERold - ERnew) X d ]· L 2ooo 

Where: 

~E = the differential of emissions; 

LA = the maximum level of activity; 

ERo1d = the existing NOx emission rate for the affected unit in pounds per unit of activity; 

ERnew = the new NOx emission rate for the affected unit in pounds per unit of activity; and 

d = (A) to calculate annual emission reductions, d = 365; and 

(B) to calculate emission reductions for the remainder of a control period, d = the number 

of days remaining in the control period. 

35 
registration 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 for the purpose of covering the cost of auto ating and maintaining the automation of the business registra on process. The current manner of maintaining firm registratio records is not efficient and not 

conducive to providing public noti e about the 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 of Architectural 

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 of the 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 of any fee. 

(e) If a 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 of the fiscal year during which 

the Registrant's active duty status exp res. 

This agency hereby certifies that th adoption has been reviewed 

by legal counsel and found to be a a lid exercise of the agency's 

legal authority. 

Filed with the Office of the Secreta of State on March 28, 2012. 

TRD-201201633 

Cathy L. Hendricks, RID, ASID/11 

Executive Director 

Texas Board of Architectural 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 changes to the proposed text as published in the October 

21, 2011, issue of the Texas Register(36 TexReg 7124). 

Background and Summary of the 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, if company 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 of an 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 ownADOPTED RULES April13, 2012 37 TexReg 2639 
ers 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 of emissions 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 

of the Chapter 101 SCT program rules from consideration by the 

EPA as a revision to the SIP. The EPA was notified of this withdrawal in a letter dated March 4, 2011. The EPA acknowledged 

the withdrawal of the 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 pro37 TexReg 2640 Apri/13, 2012 Texas Register 

posed disapproval of the SCT program rules in the April 8, 2011, 

issue of the 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 of the 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 iss ion 

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 of the economy, productivity, competition, jobs, the environment, or the public health 

and safety of the 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 of the 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 not federally 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 of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector 

of the state. 

Additionally, the repeal 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 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 under the general powers of the 

agency, but is authorized by specific sections of Texas Health 

and Safety Code, Chapter 382 (also known as the Texas Clean 

Air Act), and the Texas Water Code, which are cited in the Statutory Authority section of this rulemaking. 

Therefore, this repeal is not subject to the regulatory analysis 

provisions of Texas 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 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 of the property determined as if the governmental action is in effect. 

The commission completed a takings impact analysis for the 

adopted repeal under Texas 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 manner that would 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 of this 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 of the repeal of the 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 

ADOPTED RULES Apri/13, 2012 37 TexReg 2641 
the 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 of the 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 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 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 that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Secretary of State 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 7 468). 

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 of th 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, Subchap37 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 of the 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 of the 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 or complying 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 of grant-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. 

Under THSC, §386.1 04(k), the co mission is to consider an application for the replacement of a ehicle that has been owned, 

leased, or otherwise 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 of THSC, §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 clear that, 

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 of use of he grant-funded vehicles, including 

consideration of the availability fuel and fueling infrastructure, the 

need for vehicle fleets to support eling infrastructure, and the 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 of Houston, San Antonio, 

or diesel fuel to natural gas; 

ion of large regional vehicle fleets 

interstate highways connecting the 

lias, and Fort Worth from gasoline 

(6) support for projec s to reduce exposure of vulnerable 

populations to pollutants of cone m, including conversion of school 

bus fleets and other fleets transport g children or the elderly from gasoline or diesel fuel to natural gas; 

(7) support for conve ion of public 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 of natural gas and natural gas vehicles, engines, and associated tee logies produced, manufactured, or 

otherwise based in Texas; and 

(1 0) support for irnple entation of new 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 of grants awarded 

in a fiscal biennium must be awa ed to motor vehicles with a gross 

vehicle weight rating of at least 33 001 pounds. However, this restriction does not apply if the comrnis ion does not receive enough grant 

applications to satisfy the percent e of funding requirement. 

This agency hereby certifies tha the adoption has been reviewed 

by legal counsel and found to b a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Seer tary of State 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 of the Factual Basis for the Adopted 

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 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, if company 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 of an 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 of the Chapter 101 SCT program rules from co~­

sideration by the EPA as a revision to the SIP. The EPA wa? notified of this withdrawal in a letter dated March 4, 2011. While the 

repeal of the 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 of the 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 Register style 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 of Emission 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 of the 

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 

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 of the economy, productivity, competition, jobs, the environment, or the public health 

and safety of the state or a sector of the state. The purpose of 

the adopted rulemaking is to remove the references to the Chap37 TexReg 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 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. 

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; 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 the adopted 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 1m pact 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 

under the general powers of the 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 of the 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 of the 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 1m pact 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 of the FCAA. For these 

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. 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 limit the 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 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 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 not federally 

enforceable might be used to meet a federally enforceable rule. 

This rulemaking action does not exceed an express requirement 

ef state law or a requirement of a delegation agreement, and was 

not developed solely under the general powers of the 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; 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 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 of the property determined as if the 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 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 under the United States Constitution or the 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 et seq., 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 subject to 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 or waiting 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 of the rulemaking. 

Response to Comments 

The EPA stated its support of the repeal of the 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 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 

37 TexReg 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 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 et seq. 

This agency hereby certifies that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Secretary of State 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 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 (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 that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Secretary of State 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 certifies that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the 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 2659 
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 FCAA, 42 USC, §§7401 et seq. 

This agency hereby certifies that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the 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 that the adoption has been reviewed 

by legal counsel and found to be a valid exercise of the agency's 

legal authority. 

Filed with the Office of the Secretary of State 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 of the 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 

ORDER ADOPTING AMENDED AND REPEALED RULE AND 

REVISION TO THE STATE IMPLEMENTATION PLAN 

Docket No. 2011-0845-RUL 

On March 28, 2012, the Texas Commission on Environmental Quality (Commission), 

during a public meeting, considered adoption of the repeal of§§ 101.380, 101.382, 101.383, 

and 101.385. The Commission adopts this repeal, in Chapter 101, Subchapter H, Emissions 

Banking and Trading. This repeal removes rules that the Commission has previously 

vvithdra-vvn from the state implementation plan. 

The Commission also considered adoption of amendments to §§ 117.1020, 117.1120, 117.1220, 

117.3020, and 117.9800. The Commissions adopts these amendments in Chapter 117, Control 

of Air Pollution from Nitrogen Compounds, and corresponding revisions to the SIP. These 

amendments remove from Chapter 117 obsolete references to the Chapter 101 System Cap 

Trading Rules that the 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 authority to control the quality of the state's air and to issue orders 

consistent vvith the policies and purposes of the Texas Clean Air Act, Chapter 382 of the Tex. 

Health & Safety Code. The proposed rules were published for comment in the October 21, 

2011, issue of the Texas Register (36 TexReg 7124 and 36 TexReg 7138). 

Pursuant to Tex. Health & Safety Code Ann.§ 382.017 (Vernon 2001), Tex. Gov't Code 

Chapter 2001 (Vernon 2008), and 40 Code of Federal Regulations§ 51.102, and after proper 

notice, the Commission conducted public hearings to consider the repeal, and amended rules 

and revisions to the SIP. Proper notice included prominent advertisement in the areas 

affected at least 30 days prior to the dates of the hearings. Public hearings on the proposal 

were scheduled on November 15, 2011, at 1:30 p.m. and 6:00p.m. at the Houston-Galveston 

Area Council offices in Houston; and on November 17, 2011, at 2:00p.m. at the Texas 

Commission on Environmental Quality headquarters in Austin. 

The Commission circulated hearing notices of its intended action to the public, 

including interested persons, the Regional Administrator of the EPA, and all applicable local 

air pollution control agencies. The public vv·as invited to submit data, vievvs, and 

recommendations on the proposed repeal and amended rules and SIP revisions, either orally 

or in vVTiting, at the hearings or during the comment period. 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 on the· 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 of interested persons regarding the proposed 

.. ' · repeal;'~rid ~Pi~na~et:T.'ule~iijnd SIF:'revisions were submitted to the Commission during the 

comment ·per'i~td;\~ifd~were'tfonsitlered by the Commission as reflected in the analysis of 

tesfifittfriy fnB8rp.,.orktgdrl)y£efer~iic~ to this Order. The Commission finds that the analysis of 

testimony includes the names of all interested groups or associations offering comment on 

the proposed repeal and amended rules and the SIP revisions and their position concerning 

the same. 

IT IS THEREFORE ORDERED BY THE COMMISSION that the repealed and 

amended rules and revisions to the SIP incorporated by reference to this Order are hereby 

adopted. The Commission further authorizes staff to make any non-substantive revisions to 

the rules necessary to comply with Texas Register requirements. The adopted rules and the 

preamble to the adopted rules and the revisions to the SIP are incorporated by reference in 

this Order as if set forth at length verbatim in this Order. 

IT IS FURTHER ORDERED BY THE COMMISSION that on behalf of the 

Commission, the Chairman should transmit a copy of this Order, together with the adopted 

rules and revisions to the SIP, to the Regional Administrator of EPA as a proposed revision to 

the Texas SIP pursuant to the Federal Clean Air Act, codified at 42 U.S. Code Ann. §§ 7401-

7671q, as amended. 

This Order constitutes the Order of the Commission required by the Administrative 

Procedure Act, Tex. Gov't Code,§ 2001.033 (Vernon 2008). 

If any portion of this Order is for any reason held to be invalid by a court of competent 

jurisdiction, the invalidity of any portion shall not affect the validity of the remaining 

portions. 

Issued date: APR 0 3 2012 

TEXAS COMMISSION ON 

ENVIRONMENTAL QUALITY