PATQUINN, CJOV~KNOR DOUGLAC p. SCOTT, Dil<t( TOR



### 2171782-5544 2171782-9143 (TDD) December 07, 2009



### Cheryl Newton, Director Air and Radiation Division United States Environmental

Protection Agency Region 

### V 77 West Jackson Boulevard, AR-18J Chicago, Illinois 60604-3598 Attn: Jay Bortzer Re: R09-20: In the Matter of: Nitrogen Oxide (NOx) TradingProgram SunsetProvisions For Electri; Generating Units (EGUs): New 35 111. 

### Adm. Code 217.751 Dear 

# I

Pursuant to Section 110of the Clean Air Act (CAA),(42U.S.C. 

## 5 7410), and Sections 4,10,27, and 28 of the Illinois E~~vironmental Protection Act (415 ILCS 514, 10, 27 and 28), the Illinois Environmental Protection Agency (Illinois EPA) submits the enclosed amendment to the Illinois State Implementation Plan (SIP): R07-19: R09-20: In tlie Matter of: Nitrogen Oxide (NO3 TradingProgram SunsetProvisions For Electric Generating Units (EGUs): New 35 111. 

### Adm. Code 217.751, (hereinafter, "Sunset"). United Stales Environnlental Protection Agency's (USEPA's) regulations at 40 CFR 51.12(bb)(l )(i) provide that states such as Illinois with an approved Clean Air Interstate Rule (CAR)program may revise their applicable SPso that the provisions oftheNO, 

### SIP Call Trading Program regulations do not continue to apply to affected electrical generating units (EGUs). In Illinois, regulations for the NO, SIP Call Trading Program are set forth at 35 111. Ad~n. Code 217.Subpa1-t W. USEPA approved Illinois' CARprogram on August 23,2007. On May 7, 2009, theIllinois Pollution Control Board (PCB) accepted the Sunsetregulatory proposal as R09-20 to sunset the provisions of Subpart W. 

### A Notice ofPublic Hearing was issued by the IPCB on May 13, 2009. The Notice ofProposed Arnendinentswas published in the Illinois Register, 

### Volume 

### 33,

### pg. 8880, 

### on June 26,2009. Hearings were held on June 18,2009, in Chicago, Illinois, and on July 23, 2009, in Springfield, Illinois. On October 15, 2009, the PCB adopted a Final Opinion and Order. The effective date of this amendment is November 2,2009. The Notice of Adopted Amendments was published in the Illinois Register*

### on November 13,

Rocklord r 431'2 N Muair 5,. Rockfoiii IL 61 1113 F lll15l 9877760 Des Pinines

# - 951 l W Haitran 5:.Dri Planes. 11 61iIllb- (847) 2cih4000 Elgin. 591 5 StaLe. ilots,, ILhOi23 .lR47)6083131 Peoria I'Mi 5 N i!iilvels!ty 5,. Peoria. !I 61hlS* (309) 693-5461 Bureau of Land .-Peoria 17ii20I< UnivrrGty St., Peoria, ii 61614 Ii30'il 119754b2 Champsignn 21211 First St. Chamjlaign, IL 611120. l237i 27U-5800 Cnliin~uill~- iOfi9 Mall Scree!, Collinrviilii, $1 62234 n (h?H) I4h5120 Marit," n 2300 W Mall8 S!.. Suiie ? 16, Marion. 1L 6L9.'icJr (678)993-7200 r,r,t>,cc1 LO" l*c,yc4":l IPapC!

### 2009.A full history of the rulemaking, as well as additional background documents are available electronically at 

### ~:l/wu~w.ioch.state.il.us/COOUExten1al/CaseView.aspx?case=l3654. In order to assist wit11 your review ofthis SP submittal, two copies ofthe following documents are enclosed, as well as copy on disc: Attachment 

### 1: 

### Illinois EPA's Regulatory Proposal Attachment 

### 2: PCBNotice ofPublic Hearings, dated May 13, 

### 2009. Attachment 

### 3: Adopted Rule, Final Order, Opinion and Order of the PCB, dated October 

### 15, 2009. Attachment 

### 4: Illznois Registes

### Notice of Adopted Amendments, Vol. 33, Page 

### 15754, published November 

### 1

### 3,2009.

The plan checklists for each rulemaking and a disc are also enclosed to ass~st in your revlew. If further information is required, please contact Rachel Doctors of

### my staff at 

### 2171782-5544. Cordially, 

# 4%

Laurel 

### L. Kroack, Chief Bureau of 

### Air Enclosures

### bcc: Laurel Kroack 

### - letter, checklists Vicky VonLanken -

### letter, checklists Jim Ross 

### - letter, checklists Rob Kaleel - 

### letter, checklists 

### AQPS file 

### - letter, checklists, and 

### attaclvnenls Racliel Doctors 

### - letter, checklists, and 

### attachments

### STATE 

### IMPLEMENTION PLAN CHECKLISTS



### R09-20: In the Matter of: Nitrogen Oxide (NOx) Trading Program Sunset Provisions For Electric Generating Units (EGUs): New 35 111. 

### Adm. Code 217.751

Illinois Environme~ltal Protection Agency Bureau of Alr Division ofLegal Coui~sel 1021 North Grand Ave. East 

### P.O. Box 19276 Springfield, Illinois 62794-9276; 

### ozone ; 

### particulate matter-;

### Electronic Filing - 

### Received, Clerk's Office, April 22, 2009 *****

### R2009-020 * * * * *

BEFORE THE ILLINOIS POLLUTION CONTROL BOARD

IN 

### THE MATTEROF: 

## j NO, TRADING PROGRMSUNSET ) 

### R09- PROVISIONS FOR ELECTRlC 

## 1 (Rulemaking

## - Air) GENERATING UNITS ("EGUS") 

### 1 AMENDMENTS TO35 

### ILL. ) ADM. 

### CODEPART 217.SUBPART 

### W ) 

### NOTICE TO: John Therriault,Assistant Clerk MatthewDunn, Cliief Illinois PoliutionContro! Board Division ofEnvironmentalEnforcement James R. Thompson Center Office ofthe Attorney General 100WestRandolph, Suite 11-500 69 W. 

### Washington St., Suite I800 Chicago, Illinois 60601 Chicago, Illinois 60602 Virginia Yang, 

### Deputy Legal Counsel Illinois Dept. ofNatural Resources One Natural Resources Way Springfield, Illinois 62702 PLEASE 

### TAKE NOTICE that 1 have today filed with the Office ofthe Polluhon Control Board the REGULATORY PROPOSALFOR NO, TRADINGPROGRAM SUNSET PROVISIONS FOR ELECTRIC GENERATIONUNITS f'EGUsi'): AMENDMENTS TO 35 

### ILL. ADM. CODE PART 217.SUBPART W, 

### APPEARANCE, MOTION TO EXPEDITE, and AFFIRMATION ofthe IllinoisEnvironmental Protect~on Agency a 

### copy ofwhich is

### herewlth served upon you. ILLINOISENVIRONMENTALPROTECTION AGENCY By: /sf 

### Rachel L. Doctors Rachel

### L. Doctors Assistant Counsel Division ofLegal Counscl DATED: April 21,2009 1021North Grand Ave. East P.O. Box 19276 Springfield, Illinois 62794-9276 217.782.5544

### Electronic Filing - 

### Received, Clerk's Office, April 22, 2009 *****

### R2009-020 * * * * *

BEFORE 

### THE ILLINOIS POI,LUTION CONTROL BOARD

IN THE MATTER OF: 

### 1 NOxTRADING PROGRAM SUNSET ) 

### R09- PROVISIONS FOR ELECTRIC 

### 1 (Rulemaking 

## - Air) GENERATING UNITS ('%GUS") ) 

### AMENDmNTSTO 35 

### ILL. 

### 1 ADM. CODE PART 217.SUBPART W ) 

### TABLE OF CONTENTS OFREGULATORY SUBMITTAL Following is a Table of Coritents of all 

### pleadings and documents included with the proposed regulatory actio~l: 1. 

### Notice of Proposal 

### 2. AppearanceofRachel 

### L. Doctors, Assistant Counsel, for the Illinois EnvironmentalProtection Agency 3. 

### Director Douglas Scott's Proposal of Amendments 

### 4. Economic and Budgetary Analysis 6. 

### StatementofReasons 7. 

### Statement ofReasons Exhibits: A. First e-mail sent from Rob Kaleel dated March 19,2009 B. Second e-mail sentfrom Rob Kaleel dated March 19,2009 8. 

### First Notice 9. Proposed Amendmentsto 35 

### Ill. Adm. Code Part 217.Subpart

### W: 10. 

### Synopsisof Testin~ony 11. Motion to Expedite 12. Documents Relied On *a. Illinois EnvironmentalProtection Act (415 

### ILCS Vet, seq.) *b. 

### The Clean 

### Air Act, as amended in 1990

### (42 U.S.C. $7401

### et seq.)

### Electronic Filing 

## - Received, Clerk's Office, April 

### 22, 2009 *****

### R2009-020 

### * * * * *

*c. Rule to Reduce Interstate Transport of Fine Particulate Matter and Ozone (Clean Air Interstate Rule); Revisions to Acid Rain Propram;Revisions to the

### NOx SIP Call; Final Rule, 

### 70 Fed. 

### Reg. 25162 (May 12,2005) *d. Approval and Promulgation ofAir Quality Implementation Plans; Iliinois; OxidesofNitrogen Regulations, 66Fed. 

### Reg. 56454movember 8,2001) *e. Approval of Implementation Plans of Illinois; Clean Air InterstateRule, 72 Fed. Reg. 

### 58528 (October 16,2007) *f. 

### North Carolitza v. 

### USEPA,531 F.3d 896 (C.A.D.C. Cir. 2008) *g. 

### North Carolina v. 

### USEPA,550 F.3d 1176

### (C.A.D.C. Cir. 2008) 13. 

### Certificate of Service *Copiesof documents with an asterisk beside the letter have not been provided.

### Electronic Filing 

## - Received, Clerk's Office, April 22, 2009 *****

### R2009-020 * 

### * * * *



### BEFORE THE IL,L,INOIS POLLUTION CONTROL BOARD

IN THE MATTER OF: 

## 1 ) 

### NOxTRADING PROGRAM SUNSET ) 

### R09- PROVISIONS FOR ELECTRIC 

## 1 (Rulemaking 

## -Air) 

### GENERATING UNITS 

### ('%GUS") 

## 1 AMENDMENTS TO 35 

### ILL. ) 

### AI)M. 

### CODE PART 217.SUBPARTMi )

The undersigned, as one of its attorneys, hereby enters 

### an Appearance on behaif of the Illinois Environmental Protection Agency.



### ILLINOIS ENVlRONMENTALPROTECTION 

### AGENCY By: is1RachelL. Doctors Rachel 

### L.Doctors Assistant Counsel Divis~on of

### Legal Counsel DATED: April 2 1,2009 1021North Grand Ave. 

### East P.O. Box 19276 Springfield, Illinois 62794-9276 217.782.5544

### Electronic Filing - 

### Received, Clerk's Office, April 

### 22: 2009 *****

### R2009-020 * * * * *

BEFORE THE ILLINOIS POLLUTION CONTROL BOARD



### IN THEMATTER OF: 

## 1 1 NO, TUING PROGRAM SUNSET ) 

### R09- PROVISIONS FOR ELECTRIC ) 

### (Rulemaking

## - Air) GENERATING UNITS ("EGUS") ) 

### AMENDMENTS TO 

### 35 ILL. 

### 1 ADM. CODE PART 217.SUBPART W ) 

### Il.l,lEOlS 

### EN\'IRONMENTAL PROTECTION AGENCY PROPOS;\I. OF REGIJI..4TIOh'S 

### The Illinois Environmental Protection Agency moves that the Illinois Pollution Control Board adopt the attached regulations. Respectfully submitted, ILLINOIS ENVIRONMENTAL PROTECTION AGENCY

w 

### Director

### Electronic Filing - 

### Received, Clerk's Office, April 

### 22, 2009 *****

### R2009-020 * * * * *

Agency Analysis ofEconomic and Budgetary 

### Effects of Proposed Rulemaking Agency: Illinois Pollution Control Board ParVTitle: Nitrogen OxidesEmissions (35 Ill. Adm. CodcPart 217) Illinois Register Citation: Please attempt to provide as dollar-specific responses as possible and feel free to add any relevant explanation. 1. hnticipated effect on State expenditures and revenues (a) Currentcost to the agency for thisprogramiactivity. 

### $15.000 ver year [au~roximateld (b) ICthis rulemaking will result in an increase or decrease in cost, specify the fiscal year in which this change will first occur and the dollar amount of the effect. .No change in expense to the Illinois EPA is expected. as the NO, SIP Call Trading Proizam hasbeen replacedby the CARNO, Ozone Season Trading &omam. (c) Indicate the funding source, including Fund and appropriation lines, for this programlactivity. Clean 

### Air Act 

### Permit Program Fund (CAAPP) (d) If an innease or decrease in the costs of another State agency is anticipated, specify the fiscal year in which this change will first occur and the estimated dollar amount of the effect. No increase or decrease in costs to another State agency is anticipated, as the Illinois EPA is the wly State agency that administers the NO, SIP Call Trading and CARNO, Ozone Season Trading Programs. (e) Will this rulemaking have any effect on State revenues or expendifares not already indicated above?

### No.

2. Economic effect on persons affectedby the rulemaking: (a) Indicate the econcniic effect and specify the persons affected: Positive _;?_ Negative 

### - No effect 

### - Persons affected: Owners and onerators of eiectnc oenerating units subiect to the re~uirements of 35 Ill. Adm. Codc217.Subpart W. Dollar amount per person: 

### - Total statewide cost:

### Electronic Filing - 

### Received, Clerk's 

### Office, April 22, 2009 *****

### R2009-020 * * 

### * 

## " *

(b) If an economic effect is predicted, please briefly describe how the effect will occur. Adoption ofthis mirmakin~ will eliminateduplicate requirements. (c) 

### Will the rulemaking have 

### an indirect effect that 

### may result in increased administrative costs? 

### Will there be any change in requirements such 

### as filing, documentation, reporting or completion of forms? Therulemakine should have no indirect effect that mav result in increased administrative costs. 

## -

### Electronic Filing - 

### Received, Clerk's Office, 

### April 

### 22, 2009 *****

### R2009-020 * * * * *



### BEFORE THE ILLINOIS POLLUTION CONTROL BOARD



### IN THEMATTER OF: 

## 1 1 NOxTRADING PROGRANI SUNSET ) 

### R09- PROVISIONS FOR ELECTRIC (Rulemaking

## - Air) GENERATING UNITS: 

## 1 AMENDMENTS TO 35 

### I1,L. 

## 1 ADM. CODE PART 217.SURPARTW ) 

### STATEMENT OFREASONS

The IIlinois Environmental Protection Agency ("Illinois 

### EPA" or "Agency") hereby submltsthis Statement of Reasons to the Illinois Pollution Control Board ("Board") pursuant to Sections 10,27 and 28 oftheEnvironmental Protection Act ("Act") (415 ILCS 5/l0,27and 

### 28) and 35 

### Ill. Adm. Code 102.202(b))

### in support ofthe attached proposed amendments. Included in this proposal are amendments to 35 Ill. Adm. Code 

### Part 217, SubpartW. 

### Thisproposal amends the most recent version of Part 217.Subpart 

### W as found on the Board's websitc.



### I. ILLINOIS ENVIRONMENTAL PROTECTION AGENCY'S PROPOSAL

a. Background 

### -The 

### NO, Trading Program SubpartW 

### of Part 217 

### was adopted by 

### the Board on December 21,2000. This Subpart received approvalby the United States Environmental Protection Agency ('LUSEPA")as part of the Illinois State Implementation Plan ("SIP") for ozone on November 8, 

### 2001. 

### 66 Fed. Reg. 56449. Subpart W

### regulates nitrogen oxides ("NO3 emissions from utility boilers, or electric generationunits ("EGUs"). Illinoiswas required to regulate these sources pursuant to USEPA's 

### NO, SIP Call. 63

### Fed. Reg. 57356 (October 27,1998). 

### SubpartW 

### implemented the NO, Trading Program for

### EGUs in Illinoisto reduce ozone transport and meet Illinois' obligations

### Electronic Filing - 

### Received, Clerk's Office, 

### April 22, 2009 *****

### R2009-020 

### * * * * *

pursuant to Sections 110(a) (2) and 126of the Clean Air Act ("CAA") and 40 CFR 51.121 for EGUs. The emissions reductions helped the two ozone nonattainment areas in Illinois attain the (1997) 8-hour ozone National Ambient Air Quality Standard ("NAAQS"). 

### In addition, the continued implementation of the federal NO, Trading Program was required underPhase 

### I ofthe 8-hour ozone implementation rule. (40 CFR 51.905(f)). b. TheNew NO, Ozone Season Trading Program On May 12,2005, the Clean Air Interstate Rule ("CAIR) was adopted with the purpose of replacing the 

### NO, SIP Call Trading Program beginning with the 2009 controlperiod and adding two new tradingprograms addressing annual emissions of

### NO, and sulfur dioxide. Ruie loReduce Interstate Trunsport ofFine Particulate Matter and Ozone; Revisions toAcid Ruin Program; Revisions tothe

### NO, 

### SIP Call, 

### 70

### Fed. Reg. 25I62 (May 12,2005). Provisions implementing CAIR in Illinois were adopted by the Board in 35 Ill. Adm. Code 225 (R06-22) and approved by USEPA on October 16,2007. 72 Fed. 

### Reg. 58528. The CAIR provisions as set forth in Part 225.Subpart 

### E include a trading program for control of

### NO, emissions during the ozone season that replacesthe provisions in Part 217.Subpart

### W forEGUs beginningwith the 2009 controlperiod (May 1 

### through September 30) and thereafter. Part 225.Subpart

### E incorporatedin large part applicable provisions from the federal CARrule asrequired for federal approval. While the State regulatory process waspending, the federal CAIR rule was reviewed pursuant to anumber of petitions for review. On July 11,2008, the United States Court of 

### Appealsvacated the CARrule in its entirety and remanded the ~ule back to USEPA for revision. North Caroiinu v. USEPA,

### 531 F.3d 896 (C.A.D.C. Cir. 2008). The court in its 

### July 2008 opinion stated that pendingthe remand of the 

### CAIR program to USEPA, the provisions of the

### Electronic Filing - 

### Received, Clerk's Office, April 

### 22, 2009 *****

### R2009-020 * * 

### * * 

### *

NO, SIP Call Trading Program would remain in place. However, the same parties that had petitioned for review, alongwith USEPA, then petitioned for rehearing on the court's decision to vacate and requested that the rule be reinstated duringthe remand. 

### On December 23,2008, the cou~ grantea therehearing and unvacated CAIR with iinplementationto begin with the original control period in 2009. North 

### Cur-oiinuv. 

### USEPA,550 F.3d 1176 

### (C.A.D.C. Cir. 2008).

c. This Proposal With the reinstatement of the CAP. program, Illinois' EGUs must now comply with duplicative administrative requirements (e.g., permitting, reporting) for the 2009 ozone season and beyond until the provisions of the NO, Trading Program are sunsetted;namely, the duplicative requirementsthat appear in Parl217.SubpartW. 

### To address and removethis duplication, thisproposal for sunsettingtheprovisions ofthe NO, TradingProgram 

### is consistent with the provisions of40 CFR 51.123(bb)(l)(i), which provide that stateswith approved CAIR programsmayrevise their applicable SP so that the provisions of the 

### NO, SIP Call Trading Program donot apply to affected EGUs. 

### XI. GEOGRAPHIC REGIONS AND 

### SOURCES AFFECTED The entire State of Illinois was subjectto the NOxSZP 

### Call and is 

### now subjectto CAIR. The proposed regulationswill affect existingEGUs. There are approximately 229 

### existing EGUs 

### that are currently subject totheNO, SIP 

### Call Trading Program. For the NO, 

### SFCall Trading Program, existingunits arcthose that comnlencedoperation beforeMay 1,2006. Of these units, 170are gas and oil firedboilers, 59 

### are coal-fired boilers, and 

### theremainder are gas and oil-fired combustion turbines.

111. 

### PURPOSEAND 

### EFFECT OF THE PROPOSAL

### Electronic Filing - 

### Received, Clerk's Office, April 

### 22,2009 *****

### R2009-020 * * * * *

The purpose of this proposal is to sunset the provisions of Part 217.Subpart 

### W beginning with the 2009 controlperiod, consistentwith the CAIR rule adopted by the Board in Pan 

### 225. The CAIR rulereplaces the NO, 

### SIP Call Trading Progran~ with a program that containsboth a NO, emissions annual and an ozone season trading program. The Illinois EPA isproposmg to sunset any requirements relatedto the NO, SIP Call Trading Program afler the 2008 control period as set forth in Subpart

### W beginning with the 2009 control period and thereafter. The provisions will remain in effect for violations that occurred in control periods prior to 2009. In this case, the rule is being proposed to prevent a burden and replaces a rule that is no longer being implementedby USEPA. The adoption of the proposal will nbt result in injury or substantial prejudice, nor an abrupt departure 

### from a well established practice. Hence, adoption of this proposal is appropriatetoprevent a burden on affected EGUs. 

### IV. TECHNICAL FEASIBILITY AND ECONOiMIC REASONABLENlGSS The amendmentsto 

### Part 217.Subpart

### W arebeing proposed to ensure consistency with the 

### CAD ozone seasonprogram and prevent EGUs from being subject to duplicative monitoring, reporting,permitting and recordkeeping requirements. USEPA has stopped allocatingNO, allowances for the NO, 

### SIP Call Trading Program. As this proposal sunsets regulatory provisions, it would imposeno new requirements or costs 011 affected sources. Hence, the proposal is both technically and econon~ically feasible.

V. COMMUNICATION WITH INTERESTED PARTIES These amendmentsarebeing proposed after representativesofindustry and environmental groupshave had 

### an opportunityto review the proposed changes and provide

commentsto the Illinois EPA. The Illinois 

### EPA sent electronic inailsto the affected EGUs on March 19,2009,and received one comment on 

### an issue that will not he directly affectedby the

### Electronic Filing 

## - Received, Clerk's Office, April 22, 2009 *****

### R2009-020 * * * * *

proposal, i.e.,the disposition of remainderNO, SIP CalI TradingProgam allowances.See, Exhibits 

### A and 

### B. Therefore, it is the Illinois EPA's understanding that there are no significant issues identified by 

### interested parties.



### VI. THE ILLINOIS EPA'S PROPOSAL



### FOR ELECTRICAL GENERATING 

### UNITS Section 

### 217.751 Sunset Provisions 

### Illinois EPA is 

### proposing to sunsetthe provisions of Subpart W 

### beginning with the 2009 controlperiod and any requirements related to the NO, 

### SIP Call Trading Program after the 2008 control period. 

### Theprovisions will 

### remain 

### in effect for violations that occurred in control periods prior lo 2009.

### Electronic Filing - 

### Received, Clerk's Office, April 22, 2009 *****

### R2009-020

### * * * 

### * *

VII. CONCLUSION 

### For the reasons stated above, the Illinois EPA hereby submits this regulatory proposal and respectfullyrequests that the Board expeditiously adopts these rules for the State oflilinois.

Respectfully submitted, ILLINOISENVIRONMENTAL PROTECTION AGENCY By: Is/

### Rachel L. 

### Doctors Rachel L. Doctors Assistant Counsel Division of Legal Counsel DATED: April 21,2009 1021North Grand Ave. East P.O. Box 19276 Springfield,

### IL 62794-9276 217.782.5544

### Electronic 

### Filing 

## - Received, Clerk's Office, April 

### 22, 2009 *****

### R2009-020 * * * * * llllnois 

### EPAExhibit 

### No. 

# A Doctors, Rachel From: Kaleel, Rob Sent: Thursday, March 19,2009 5:05 PM To: Doctors, Rachel Subject: FW: Rulemaking Proposal to Sunset the NOx SIP Call for EGUs Attachments: Sec217-751 .pdf

Here's the first email

...

. 

## - From: Kaleel, Rob Sent: Monday, March 16, 2009 459 PM To: (abigail.rector@exeloncorp.com); (arnold.jenkinsjr@dukeenergy.com); (biII.murray@cwlp.com); (bruceparker@electricenergyinc.corn); (Bsteinhauser@ipr-us.com); (U.Saladino@dom.com); (jacobsen@tenaska.com); (dale.davis@exeloncorp.com); (dave,farris@cwlp.com); (dfcole@ameren.com); (dfurstenwerth@reliant.com); (Diane.Leopold@dom.corn); (djmurphy@pplweb.com); (gkunkel@tenaska.com); (glenn.caIloway@calpine.com); (Glenn.P..lohnson@dom.com); [james.eiseman@dynegy.com); (james.r.kipp@dynegy.com); (jason.goodwin@calpine.corn); (jim.idzorek@nrgenergy.com); (jmclaurin@sipower.org); (Joseph.C.Wood@dom.corn); (jrtaylor@cordovaenergy.corn);(jshimshock@reliant.com); (kirk.millis@dynegy.com); (kjanderson@ameren.com); (laboyer@pplweb.com); (Larry.Waite@dynegy.com); (Icarlson@tenaska.com); (Ihopkins@sipower.org); (Lonnie.A.Grote@dynegy.com); (mcgriggs@duke-energy.com); (mlmenne@ameren.com); (pcgrigsby@dukeenergy.corn); (pj.becker@cwlp.com); (randy.specht@exeloncorp.com); (rfisher@ppi.coop); (robert_crowe@dynegy,com); (roger.stegeman@sweci.com); (russel.gilbert@sweci.cornj; (schy.willmore@cwlp.com); (smiller@mwgen.com); (sphart@cordovaenergy.com); (stan-sander@dynegy.corn); (ted-lindenbusch@dynegy.com); (terrylarbes@eledricenergyinc.com); (timothy.kelley@dynegy.com); (tjonas@tenaska.com); (vbrisinl@reiiant.com); (wendell-watson@dynegy.com); Asplund, Bob; Bassi, Kathleen; Kolaz, Dave Subject: Rulemaking Proposalto Sunset the NOx SIP Call for EGUs Attention CAlR Contacts: The Agency intendsto submitthe attached proposal to the Illinois PollutionControl Board inthe next few weeks with a requestto expedite the rulemaking.The intent of this proposal isto sunset the provisionsofthe NOxSIP Call (Subpart W) affecting electric generating units, as these provisionshave been superseded by Illinois' CAlR rule. We don't believe this proposal 1s controversialso we will not initiate a formai outreach process before we submit this to the Board. Please iet me know ifyou have any questionsor concerns. Rob Kaleel Air Quaiity Planning Bureau ofAir

### Electronic 

### Filing - 

### Received, Clerk's 

### Office, April 

### 22, 2009 *****

### R2009-020 * 

### * * * * 

### llllnois EPA Exhibit 

### ~o.8

, 

### Doctors, Rachel From: Kaleei. Rob Sent: Thursday. March 19,2009 535 PM To: aroyden-bioom@4cleanair,org; Baker, David; Bakowski, Ed; Barnes, Donald; Beck.AJ; Biaieki, George; Biel, Mark ; Bloomberg, David E.; Bowles, Ryan; Brennan, Jessica; Bressen, Craig; Brown, RB; Bugei, Faith; Choi, J; Churchill. Merie; Ciayborn, Becki; Coe, Tom; Constantelos, Bili; Crescent RidgeWind; Culick, Martin; Cumbow. Jim; Darrin,Jack; Davis, Rory; Deacon, Mac; Depp, Caroline; Diericx, Rick; Doctors, Rachel; Drenner,Lou; Dwyer. David; Dypold, Dirk; Earl, Ronald ; Evans, Patrick ;Fabian, Bill; Farren, Brenda; Fisher, Randy; Freestone. Maryl; Haas, William; Hardt, Peter; Harrington. Jim; Haun, Jeff; Helm,Jim ; Hirner, DK; Hodge, Kathy; Holston, Erik; ilika, anita: Illinois Ciean Energy Foundation; Illinois Landfill Gas Coalition; Illinois Manufacturers Association; IllinoisSolar; Irwin, Barb; Jenkins, Arnold; Johnson, Mike; Jones, Doug; Jouras, Mike; Kaleel, Rob; Kaieel, Rob; Kanczuzewski, 

### TJ; Kruse, Andy: Learner, Howard; ieavlt, Brandon; Loll, Brian; Mader, Kelly; Matoesian, Charles; Matty, Robert; McFarlan, Doug: McGuire, W.F.; Mcinnis, Michael; Monk, Jim: Morgenstern, Roger;Nathan, Ernie; Nilles, B~ce; O'Keefe, Mary Eileen; Oisen, Erik; O'Shea, Kevin; Owen, Verena; Parker, James; Pike CountyWind; Pilapii, Ray; prohov, rick; Romo, Bob; Rosenbaum, David; Ross,Jim; Ruhi, Jeffery; Sanch, Robert; Schneider,Jim ;Sims, Jackie; Snider, Donaid; Stanch, Michael; Stanfield, Becky;Swarupa Ganguli; Tickner, Diana; Vogl, Bob; Wanninger, Kent; Weis, John; Welis, Bob; Wheatley, D. Blake; White, Jason; Whitlock, Bili; Whihvorth, Steve; Wiikerson. Mark; Wind Mail Subject: Rulemaking Proposalto Sunset the NOx SIP Call for EGUs Attachments: Sec217-751 .pdf

Attention CAlR Contacts: Myapoiogiesto those of you who are receiving this message a second time. My first email apparentiy didn't reach everyone. The Agency intendstosubmit the attached proposalto the Illinois Pollution Control Board inthe next few weeks with a requestto expeditethe ruiemaking.The intent of this proposai 1sto sunset the provisions of the NOx SIP Call (Subpart W) affecting electric generating units, as these provisions have beensuperseded by Illinois' CAlR rule. We don't believe this proposalis controversial so we will not initiate a formal outreach process before we submit this to the Board. Piease let me know ifyou have any questions or concerns. Rob Kaieel Air Quality Planning Bureauof Air

### Electronic Filing - 

### Received, Clerk's Office, 

### April 22, 2009 *****

### R2009-020 * 

### * * * *

ILLINOIS REGISTER POLLUTION CONTROLBOARD NOTICE OF PROPOSED AMENDMENTS 

### I) Heading of the Part: Nitrogen Oxides Emissions 2) Code Citation: Amendments to 35 Ill. Adm. Code

### Part 217 3) SectionNumbers: 217.751 Proposed Action: Add 4) StatutoryAuthoritv: Implementingand authorized by Sections 10and 27 of the Illinois EnvironmentalProtection Act [415ILCS 5110 and 271. 5) A Comnlete Description ofthe Subjectsand Issues Involved: This proposal will add a provis~on sunsettingthe NO, SIP Call requirements as set fortl~ in Subpart W that apulv

, to electric generating units ("EGUs") andthathave been supersededb; the requirements for the Clean Air Interstate Rule 

### ("CAR") as set forth in Part 225. Beginning with the 2009 controlperiod (May1 through September 30) and thereafter, Subpart 

### E ofPart 225 provides forthe control of nitrogen oxides 

### ("NO,") emissions from EGUSthrough the implementation of 

### an interstatetrading promam. The trading.program in SubuartE of 

### -. 

## - Part 225 supersedes the interstate~0;~radin~ Program that is set forth in subpart W of Part 2 17for EGUs. 6) Will this proposed amendmentreplace an emervencv rule currentlv in effect? No 7) Does this 

### rule ma kin^: contain 

### an automaticrepeal date? No 8) Does this proposed amendment contain incorporations by reference? No 9) Are there any otherproposed amendments pending on this Part? Yes Section Numbers Proposed Action Illinois Register Citation 217.386 Amend 32 Ill. Reg. 17075



### . 217.385 Amend 32 Ill. Reg. 17075 217.390 Amend 32 Ill. Reg. 17075 217.392 Amend 32 Ill. Reg. 17075 217.394 Amend 32 Ill. Reg. 17075 217.396 Amend 32 Ill. Reg. 17075 10) Statement of Statewide Policy Obiectives: Theseproposed amendmentsdo not create or enlarge a state mandate as defined in Section 3@)ofthe State Mandates Act. [30 ILCS 805131.

### Electronic Filing - 

### Received, Clerk's Office, 

### April 22, 2009 *****

### R2009-020 * * * * *

ILLNOIS REGISTER POLLUTION CONTROL BOARD NOTICE 

### OF PROPOSED AMENDMENTS 

### 11) Time. Place, and Manner in which interested persons may commenton this proposed rulemaking: The Board will acceptwritten public comments on this proposal for a period of forty-five (45) days after the date ofpublication in the IllinoisRegister. Comrnenls should reference Docket R09- and be addressed to: Clerk's Office Illinois Pollution Control Board 100W. 

### Randolph St., Suite 11-500 Chicago, 

### IL60601 and Rachel L. Doctors Illinois Environmental Protection Agency 1021North Grand Avenue East P.O. Box 19276 Springfield, IL 62794-9276 217-782-5544 12) Initial Remlatorv Flexibility Analysis: A) 

### Types of small businesses, small mur~icipalities and not for profit corporations affected: Any small businesses, small municipalities,or not-for-profit corporations that are subject to the NO, TradingProgram couldbe affected by the proposed amendments. 

### B) Reporting, bookkeeping or otherprocedures required for compliance: None C) Types of Professional skillsnecessary for compliance: None

13) 

### Thisrulemakine was

### not included on either ofthe two most recent remlatorv ailendas 

# m: This 

### rulemaking was not included in either ofthe two most recent regulatory agendas because ofthe uncertainty associated with the CARTradingprogram that was adopted to replace the

### one that is 

### the subject of this proposal. On July 11,2008, the United States Court of Appeals vacated the CARrule in its entirety and remanded the rule back to USEPA forrevision.North Carolina v. 

### USEPA,531 

### F.3d 896 (C.A.D.C. Cir. 2008). The court stated that pending the remand ofthe CAEprogram that theprovisions of the 

### NOxSIP Call Trading Program would remain in place. However,the same petitioners then requested that the rule be reinstated duringthe remand. On December

### Electronic Filing - 

### Received, Clerk's Office, April 

### 22,2009 *****

### R2009-020 * * * * 

### *

ILLINOISREGISTER POLLUTION CONTROL BOARD NOTICE OFPROPOSED AMENDMENTS 23, 2008, 

### the court granted the rehearing and unvaeated. North Carolina v. 

### USEPA,550 

### F.3d 1176 

### (C.A.D.C. 

### Cir. 2008). 

### Therefore, pending the remand, the original CAlR 

### as adopted at 

### 35 

### Ill. Adm. Code Part 225, 

### is in effect. I4j 

### Uocs rl:ij 

### ancndmcn! r<iluir?rh: 

### revien oithe Proicre~neni f'ol~cv Boz~d 

### as speci.'icd it! Seiunn 

### 5-25 

### ofthe Tllinoi.; Pr~:c~re!r?nr Codc?. [;C, 

### ILCS SUO 

### 5-75; 

### So The hlltext of

### the Proposed Amendment(s)begins onthe next page:

### Electronic Filing - 

### Received, Clerk's Office, April 22, 2009 *****

### R2009-020 * * 

### * * *

ILLINOISREGISTER POLLUTION CONTROLBOARD NOTICE OFPROPOSED AMENDMENTS TITLE 35: ENVIRONMENTALPROTECTION SUBTITLE

### B: AIR POLLUTION CHAPTER 1. 

### POLLUTION CONTROL BOARD SUBCHAPTER C: EMISSION STANDARDS AND 

### LLMITATlONS FOR STATIONARY SOURCES PART 217 NITROGEN OXIDES EMISSIONS SUBPART A. 

### GENERALPROVISIONS Section 217.100 Scopc and Organization 217.101 Measurement Methods 217.102 Abbreviations and Units 217.103 Definitions 217.104 Incorporations by Reference SUBPARTB: NEW FUEL COMBUSTIONEMISSION SOURCES Section 217.121 New Emission Sources SUBPART C: EXISTING FUEL COMBUSTIONEMISSION SOURCES Section 217.141 Existing Emission Sources in Major Metropolitan Areas SUBPART K: PROCESS EMISSION SOURCES Section 217.301 Industrial Processes SUBPART 

### 0: CHEMICALMAMJFACTURE Section 217.381 Nitric Acid Manufacturing Processes SUBPART Q: STATIONARYRECIPROCATING DiTERNAL COMBUSTION ENGINES AND TURBINES Section 217.386 Applicability 217.388 Control and Maintenance Requirements 217.390 Emissions Averaging Plans

### Electronic 

### Filing - 

### Received, Clerk's Office, April 22, 2009 * * * * 

### * R2009-020 * * * * *

ILLWOIS REGISTER POLLUTION CONTROL BOARD NOTICE OF PROPOSED AMENDMENTS 217.392 

### Compliance 217.394 

### Testing and Monitoring 217.396 

### Recordkeepingand Reporting SUBPARTT: CEMENTKILNS Section 217.400 

### Applicability 217.402 

### Control Requirements 217.404 

### Testing 217.406 

### Monitoring 217.408 

### Reporting 217.410 

### Recordkeeping

Section 217.450 217.452 217.454 217.456 217.458 217.460 217.462 217.464 217.466 217.468 217.470 217.472 21 7.474 217.476 217.478 217.480 217,482 

### SUBPART

### U. NO, CONTROL

### AND TRADING PROGRAM FOR SPECIFIEDNO, GENERATINGUNITS Purpose Severability Applicability Compliance Requirements Permitting Requirements Subpart U NO, Trading Budget Methodologyfor ObtainingNO, Allocations Methodologyfor DeterminingNO, Allowanceshorn the New Source Set-Aside NO, Allocations Procedure for SubpartU Budget Units New Source Set-Asides for 'TJew" Budget Units Early Reduction Credits (ERCs) 

### for BudgetUnits 

### Low-Emitter Requirements Opt-In Units Opt-In Process Opt-In Budget Units: Withdrawal from NO, Trading Program Opt-Ln Units: Changein Regulatory Status Allowance Allocations to Opt-In Budget Units SUBPART V: 

### ELECTRICPOWER GENERATION Section 217.521 

### Lake ofEgypt Power Plant 217.700 

### Purpose 217.702 

### Severability

### Electronic Filing - 

### Received, Clerk's Office, April 22, 2009 *****

### R2009-020 * * 

### * * *



### ILLINOIS REGISTER POLLUTION CONTROL BOARD NOTICE OF PROPOSED AMENDMENTS 217.704 

### Applicability 217.706 

### Emission Limitations 217.708 

### NO, Averaging 217.710 

### Monitoring 217.712 

### Reporting and Recordkeeping

Section 217.750



### Section 217.800 217.805 217.810 217.815 217.820 217.825 217.830 217.835 217.840 217.845 

### SUBPART

### W: NO, TRADING PROGRAM FOR ELECTRICAL GENERATING UNITS Purpose Sunset Provisions Severability Applicability ComplianceRequirements Permitting Requirements NO, TradingBudget Methodologyfor Calculating NO, Allocations for Budget Electrical GeneratingUnits (EGUs) NO, Allocations for Budget EGUs New Source Set-Asides for "New" Budget EGUs Early Reduction Credits for BudgetEGUs Opt-In Units Opt-In Process Budget Opt-In Units: WithdrawalfromNO, Trading Program Opt-In Units: Change in Regulatory Status AllowanceAllocationsto Budget Opt-In Units SUBPARTX: 

### VOLUNTARY NO, EMISSIONS REDUCTION PROGRAM Purpose EmissionUnit Eligibility ParticipationRequirements NO, Emission Reductions and the Subpart

### X NO, Trading Budget Ba~eline Emissions Determination Calculation of CreditableNO, Emission Reductions Limitatiollson NO, Emission Reductions NO, Emission Reduction Proposal Agency Actlon Emissions 

### DetcnnationMethods

### Electronic Filing - 

### Received, Clerk's 

### Office, April 22, 2009 *****

### R2009-020 

### * * 

### * * *

ILLINOIS REGISTER POLLUTION CONTROL BOARD 

### NOTICE 

### OF PROPOSEDAMENDMENTS 217.850 

### Emissions Monitoring 217.855 Reporting 217.860 Recordkeeping 217.865 Enforcement APPENDIX A 

### Rule into SectionTable APPENDIX

### B Section into Rule Table APPENDLX C Compliance Dates APPENDIX D 

### Non-Electrical Generating Units APPENDIX

### E Large Non-Electrical GeneratingUnits APPENDIX

### F Allowances forElectrical Generating Units 

# - APPENDLY 

### G Existing ReciprocatingInternal Combustion Engines Affected by 

### the NO, SIP Call Authority: Implementing Sections 9.9 and 

### 10 and authorizedby 

### Sections 27 and 28.5 

### ofthe EnvironnlentalProtection Act i415 ILCS 519.9, l0,27 and 28.5 (2004)l. Source: Adopted as 

### Chapter 

### 2: A~T Pollution,

### Rule 207: 

### Nitrogen Oxides

### Emissions,R71-23,4 PCB 191,

### April 12,1972, filed and effectiveApril 14, 1972; amended at 2 Ill. Reg. 17,p. 

### 101, effectiveApril 13, 1978; codified at 7 111. 

### Reg. 13609;amended in R01-9 at 25 Ill. Reg. 128, effectiveDecember26,2000; amended in R01-11 at 25 

### Ill. Reg. 4597, effective March 15,2001; amended 

### in R01-16 and R01-17 at 25 111.Reg. 59 14, effectivcApril 17,2001;amended inR07- 18 at 31Ill.

### Reg. 14254,effective September25,2007; amended 

### in R09- at 111. 

### Re% effective

SUBPARTW: 

### NO, TRADING PROGRAM FOR ELECTRICAL GENERATlNG UNITS

Section217.751 Sunset Provisions The provisionsofthis SubpartW 

### shallnot ap~ly for 

### my control period in 2009 orthereafter. Noncompliancewith 

### theprovisions of this Subpart that occurredprior lo 2009 is subjectto the 9plicableprovisions of this Subpart. (Source: Added at

# __ 111. Reg. , effective 

## 1

### Eiectronic Filing 

## - Received, Clerk's Office, 

### April 22, 2009 *****

### R2009-020 * * * * *

Synopsis ofTestimony Yoginder Mahajan, Environmental Protection Engineer, Air Quality Planning Section, Bureau of Air, Illinois 

### EPA. Mr. Mahajan will addressthe fo'oilowing: 

### * The NOx SIP 

### Call NOx TradingProgram forElectrical Generating Units in 

### 35 111.Adm. Code Subpart W 

### has been replaced by CAIR Ozone SeasonNOx Trading, Subpart

### E of 

### 35 Ill. Adm. Code 225. Theproposal provides that the provisions of Subparl W shall not apply for 

### any control period in2009 or after. However, the provisions of SubpartW will remain in place for non-compliance in control periods prior to 2009. Thetwo trading programs contain duplicate NOx emissions monitoring, reporting, and record keeping provisions. Adoption ofthe proposal will eliminatethe duplication.

0 As this proposal does not add additional requirements,but removes duplicative provisions, no adverse technological and economic impacts are anticipated.

### Electronic Filing - 

### Received, Clerk's Office, 

## April 22,2009 *****

### R2009-020 * * * * *

BEFORE THEILLINOIS POLLUTION CONTROL BOARD IN THE MATTER OF: 

## 1 1 NO, TRADING PROGRANl SUNSET ) 

### R09- PROVISIONS FOR ELECTRIC 

## 1 (Rulemaking

## - Air) GENERATING UNITS: ) 

### AMENDMENTS TO 35 

### ILL. 

### 1 ADM. CORE PART 217.SUBPART 

### W )



### MOTION FOR EXPEDITED REVIEW NOW COMES Proponent, the IllinoisEnvironmental Protection Agency ("Illinois EPA"), by one ofits attorneys, and pursuant to 35 Ill. Adm. Codc 101.512, respectfully submits 

### this Motion 

### forExpedited Review ("Motion"). 

### In support of its Motion, the Illinois EPA states as follows: 1. 

### Subpart 

### W ofPart 217 was adopted by the Board on December 21,2000. On November 8,2001, this Subpart received approval bythe United StatesEnvironmental Protection Agency ("USEPA"). 66

### Fed. Reg. 56454. Subpart 

### W regulates nitrogen oxides ("NO,") 

### emissions from 

### utility boiiers, or electric generation units ("EGUs"). The State of Illinois was required to regulate these sourcespursuant to USEPA's NO, SIP Call. 63

### Fed. Reg. 57356 (October 27,1998). 2. On May 12,2005,USEPA promulgated the Clean Air Interstate Rule ("CAIR) with the purpose ofreplacing the NO, SIP Call Trading Program beginning with the 2009 control period. Rule 

### toRedrtcc interstate Transport of Fine Pa~iculate Matter and Ozone; Revisions toAcid Rain Program; Revisions to [lie 

### NO, SIP Call, 

### 70Fed. Reg. 25162 (May 12, 2005). Provisions implementing CAEin Illinois were adopted by the Board in 

### 35 111. Adnl. Code 225 (R06-22) and approved by USEPA on October 16,2007.72 

### Fed. Reg, 58528. The CAIR provisions as set forth in Part 225.Subpart E include a trading program for conhol ofNO,

### Electronic Filing - 

### Received, Clerk's Office, April 22, 2009 *****

### R2009-020 * * * * *

emissions during the ozone season that repiaces the provisions in Part 217.SubpartW for EGUs beginning with the 2009 controi period (May 1 through September 30) and thereafier. 3. This proposal for sunsetting Subpart

### W was not put forward with the CAIR rulemaking because while the Stateregulatoryprocess was pending, the federal CARrule was the subject of court review. On July 11,2008,the United States Court 

### ofAppeals vacated the CAlR rule in its entirety and remanded the rule back to USEPA forrevision and lei? the provisions of the 

### NO, SIP Cail Trading Progam in place.

### North Carolitta v. 

### USEPA,531 

### F.3d 896 (C.A.D.C. Cir. 2008). 

### 4. The samepartiesin 

### Nortii Carolirta,then,petitioned for rehearing on the court's decision to vacate and requested that the CAIR rule be reinstated duringthe remand. On December 23, 2008, the court unvacated 

### CARwith implementation to begin with the original control period in 2009. 

### North Carolir~a v. 

### USEPA, 550F.3d 1176 (C.A.D.C.Cir. 2008). 5. 

### With the reinstatement ofthe CAlR program, Illinois' EGUs must now comply with duplicative administrativerequirements (e.g., permitfing,reporting)for the 2009 ozone

season and beyond until the provisions ofthe NO, TradingProgram are sunsetted; namely, the duplicative requirementsthat appearin Part217.Subpart W. 6. For the reasons stated above, and due to the impending 2009 ozone season control period (May 1,2009,through September 30,2009),the regulationsneed tohe adopted in an 

### expedited manner. 7. In light ofthe foregoing,it is necessary to expeditereview in this matter. 8. 

### Therefore,the Illinois EPA requests that the Board proceed to First Notice under the Illinois AdministrativeProcedure Act, 5 

### ILCS 10011-1 el seq.,

### without reaching a decision on

### Electronic Filing - 

### Received, Clerk's Office, 

### April 22, 2009 * * * * * 

### R2009-020 * 

### * * * *

its merits, by acceptingthe regulatory language proposed by the Illinois EPA in this nilemaking proposal for purposes of First Notice. 

### 9. The Illinois EPA also request that therequisite public hearings be scheduled as soon as possible 

### in accordancewith Section 28(a) ofthe Illlnois EnvironmentalProtection Act, 415 ILCS 5/28(a). 10. The IllinoisEPA believes that the Board possesses the information necessary to proceed to First Notice in this rulemaking and to schedule a public hearing is contained in the Statement of Reasons. Ifmore information isneeded,the Illinois EPA 

### will fully cooperateto expeditiously provide the sameto the Board and its hearing officer. 1



### I. As required by 

### 35 111.Adm. Code Section 101.512,this Motion is accompanied by an Affirmation attestingthat the factscited herein aretrue.

WHEREFORE, for the reasons set forth above, the Illinois EPArespecthlly requeststhat the Board grant itsMotlon and expedite review in thismatter. Respectfullysubmitted, ILLINOIS ENVIRONMENTAL PROTECTION AGENCY By: lsl Rachel 

### L. Doctors Rachel 

### L. Doctors Assistant 

### Counsel Division ofLegal Counsel DATED: April 2 

### 1,2009 1021 

### North Grand Avenue, East 

### P.O.Box 19276 Springfield, Illinois 62794-9276 217.782.5544

### Electronic Filing - 

### Received, Clerk's Office, April 

### 22, 2009 *****

### R2009-020 

### * * * * *



### BEFORE THE ILLINOIS POLLUTION CONTROLBOARD 

### IN TEEMATTER OF: ) 

### f NO, TRADING PROGlPPJM SUNSET ) 

### R09- PROVlSIONS FOR ELECTRIC 

## 1 pulemaking

## -Air) GENERATING UNITS: 

### 1 AMENDMENTS TO35 

### ILL, ) 

### ADM. 

### CODE PART 217.SUBPART 

### W )



### I, Rachel 

### L. Doctors, under other,hereby state and 

### afftrm that 

### I am an Assistant 

### Counsel for Illinois EPA and the facts cited 

### in the foregoingMotion for ExpeditedReview are true and correct to the best'of

### myinformation and belief. ,-



### Assistant Counsel Division ofLegal Counsel



### SUBSCRIBED AND 

### SWORNTO 

### BEFORE

### ME

Notary Public

### Electronic Filing - 

### Received, 

### Clerk's Office, 

### April 22, 2009 *****

### R2009-020 * 

### * * * *

STATE OF ILLINOIS ) 

## 1 SS COUNTY OF SANGAMON 

### 1 1 CERTIFICATE 

### OF SERVICE 

### I, the undersigned,an attorney, state that 1have served electronicallythe attached 'LA.I:OKY PROPOSAI. 

### FQR.-~~.~~T~~uc;.PKQGR~.I.~s_~s~RO~QNS~O~ EI.ECTRIC C ' -RATION LiNITS(xG.L~"~. AhIZL>;\.lETNS '1'0 35 ILL 

### .&DM. COD5 

### -- - &ZL.. -. PAR

### I' 2:

## 7SCHPAKT \<'.

### .M=!CE, MOTIOK TOESPEDII'E .4ND .AFFIKMA'IIOK 

### OF the Illinois Environn~ental Protection Agency upon the following persons: 3ohn Themault, Assistant Clerk Illinois Pollution Control Board James R. Tho~npson Center 100West Randolph, Suite 11-500 Chicago, Illinois 60601 Matthew 

### Dunn, Chief Division ofEnvironmental Enforcement Office of the Attorney Genera1 69 W. Washington 

### St., Suite 1800 Chicago, Illinois 60602 Virginia Yang, Deputy Legal Counsel Illinois Dept. ofNatural Resources One Natural Resources Way Springfield, Illinois 62702 ILLINOISENVIRONMENTAL PROTECTION AGENCY lsi Rachel 

### L.Doctors Rachel L. Doctors Assistant Counsel Division of Legal Counsel Dated: April 21,2009 1021 North Grand Avenue East P.O. Box 19276 Springfield, Illinois 62794-9276 217.782-5544ILLINOIS POLLUTION CONTROL BOARD May 13,2008 

### p2 fg-

# c. fi E% ;:# ciC?Rw~ OfFICE IN THE MATTER OF: 

### 1 ) 

# H;&( 1 2@J3 NITROGEN OXIDE (NO,) TRADING ) R09-20 STATE 

### OF ILLINOIS PROGRAM SUNSET PROVISIONS FOR ) (Rulemaking

### - Air) 

### potiuinn 

### controt ELECTRIC GENERATING UNITS (EGUs): ) 

### NEW 35 ILL. ADM. CODE 217.751 )



### NOTICE OF HEARING DATES, TIMES, PLACES: Thursday, June 18,2009,1:00 p.m. Thursday, July 23,2009 1:00p.m. JAMES R. THOMPSON CENTER IEPA OFFICE BUILDING Room 11-512 Room 1244N,First Floor 100W. Randolph-Room 11-512 1021N. Grand Avenue East Chicago, IL 60601 Springfield, 

### IL 62794 PURPOSE OFHEARING: Merit and economic ATTENDING BOARD MEMBER: Dr. ShundarLin 

### HEARING OFFICER: KathleenM. Crowley



### HEARING 

### OFFICER ORDER Procedural Historv On April 21,2009, the Illinois Environmental ProtectionAgency (Agency) filed 

### a proposal for rulemaking under Sections 10.27 and 28 of theEnvironmental Protection Act (Act), 415 ILCS 5/10,27,28 (2006). The proposal would add a single new section, 35 Ill. Adm. Code 217.751to 35 111. Adm. Code 217.Subpart W. Beginning with any control period in 2009, the new sectionwould "sunset", or render inapplicable, theprovisions of the Nitrogen Oxides (NO,) Trading Program for electrical generatingunits (EGUs)found at 35 111.Adm. Code 217.Subpm W. But, the Agency proposes that the provisions 35 Ill. Adm. Code 217.Subpart W will remain in effect for violations that occurred in control periods prior to 2009. 

### In a May 7,2009order,the Board acceptedtheproposal forhearing. The Board also authorizedpublication of the proposal (without commenton the proposal's merits)

### in the Illinois Register as required by the Illinois Administrative Procedure Act 

### (MA),5 ILCS 100et seq. (2006).

In camplimcewith the Amencans With DisabilitiesAct and other applicablefederal and Stzte laws,the hearings will be accessiblero individuals with dirabilities. Persons reaulnne auiliarv aid! should contactJohn T Therrisult.AssisrantClak ofthe Board. IW West RandolohSat.OnMay 13,2009, 

### as requiredmder Section

### 27(b)(l)of the Act,415 LCS 5/27(b)(1)(2006),the Board requested that the Departmentof Commerceand Economic Opportunity (DCEO) conduct a studyof the economic impactofthe proposedrules. TheBoard requested a response no laterthan June 30,2009, so that the economicimpact study (EcIS) issuecould be addressed atthe July 23,2009hearing. 

### The Bearings The Board will conduct two hearings in order to allow theproponent and any other interested participants the opportunitytopresent testimony onthe merits and economic impact of the rulemaking proposal. At hearing, all persons who testify will be sworn in and subject to questioning.The Board will also receive any testimony on any EcIS conducted by DCEO on the proposed rules or on DCEO's decision not to perform anEcIS. As indicated above in thenotice of hearings, the first hearing will begin on Thursday, June 18,2009 and will continueuntil the day's business is completed,but in no event later than 5:00 p.m. The secondhearing is scheduled to begin Thursday, July 23,2009 and will and will continue, continueuntil the day's business is completed, but in no event later than 4:30 p.m. 

### Pre-Filin~ Deadlines Participants who intend to testify must pre-file their testimony and servethe testimony on the hearing officer and all persons on the Service List. Before filingpre-filed testimonyor any other document with the Clerk,please check for the most recent version of the Service List with the hearing officer or the Clerk's Office. Paxticipants in the first hearing are directed topre-file all of their testimony and any related exhibits no laterthan Friday, June 5,2009. Under Section 27 of the Act (415 ILCS 5/27 (2006)),the first hearing is not limited to the testimony of the proponent. But, the hearing officer presently intendsto allow the Agency as proponentto present the testimony of all of its witnesses before hearing the testimony of otherparticipants. Therefore, any otherperson wishing to testify at the first hearing should also pre-file their by June 5, 2009. Participantswishing to testify at the second hearing are directed to pre-file all of their testimony and any related exhibits no later than Friday, July 10,2009. The "mailbox rule" at 35Ill. Adm. Code 101.300(b)(2)does not apply to the filingof this pre-filed testimony, and the Board's Clerk must therefore receive these documentsbefore the close of business on the specified dates. However, pre-filed testimony and other documents maybe filed electronicallythough the Clerk's Office On-Lie (COOL) from the B03ldls Web site at www.ipcb.state.il.us. Any questions about electronic filing through COOL shouldbe directed to the Clerk's Office at (312) 

### 814-3629. 

### Order 

### of Hearings All pre-filed testimony will be, entered into the record as if read. See 35 Ill. Adm. Code 102.424(f). A brief summary of testimonywill be allowed if a witness wishes toprovide onebefore responding to questions. Participants who do not pre-file testimony will be allowedto testify as time permits only after the conclusion of pre-filed testimony and questions based upon it. Similarly,any participant who wishes to offer a public comment willbe allowed to do so as time permits at the close of pre-filed testimony and the questions based upon it. Consequently, any person wishing to testify at either of the two hearings is urged topre-file their testimony 

### in order to ensure that they have an opportunity to testify. 

### In addition, the Board's procedural rules provide that "[tlhe Board will accept written comments from any person concerningthe proposed regulations during the first notice period." 35 Ill. Adm. Code 102.604. Thehearing scheduled to begin on June 18,2009,will begin with the Agency's presentation of its case as the proponent. After the Agency has answered all questions from other participants, and if time permits before the conclusionof the first hearing, other persons who have pre-filed may testify. The Boardhas reserved sufficient time for each hearing and anticipatesthat any person who wishes to testify will have 

### an opportunity for testimony and any cross-examination. 

### In the event that any person who pre-files testimonyfor the first hearing cannottestify onJune 18,2009,because time does not allow it, that person will be given priority to testify on July 23,2009. The July 23,2009hearing will begin with any testimony from any participant who prefiled testimony for the first hearing and who was not able to testify at that time. Participants who pre-filed testimony for the second hearing will then present that testimony. Any participant who wishes to offer a public comment at either hearing will be allowed to do soif time permits at the close ofpre-filed testimony and the questions based upon it. Again, written public comments may be submitted to the Board. See 35 Ill. Adm. Code 102.604. Finally,the hearing officer, upon agreement 

### oftheparticipants or upon motion to the hearing officer, may change the order of testimony at these hearings. See 35 Ill. Adm. Code 102.420,citing35 Ill. Adm. Code 101.SubpartF. 

### Service and

### NoticeLists The Service List for this rulemakingis the list of persons who wish toparticipate actively in this proceeding and receive not only the Board's opinions and ordersbut also other filings such as pre-filed testimony and public comments. The Notice List includes participantswho wish to receive only the Board's opinions and orders and hearing officer orders. The Board adopted the Part 217 NOx TradingProgram Rules nearly 9 years ago 

### in Pr Program for Electrical Generating Units, and Amendments to 

### 35 Ill. Adm. Code 211 and 217, ROl-9 (Dec. 21,2000). TheR01-9 notice listbegan with each of the approximately 229 potentially affected EGUs who werepart of the Board's servicelist in the R01-9 proceeding in which the Part 217 NOx Trading Programrules were adopted. 

### This notice lististoo datedto serve 

### as the basis for the notice listhere.Instead, the Board will begin its notice list in this proceeding with the notice list in the still-pending,but currently inactive, docket which the Agency proposed to amend these rules: NOx Tradm~ Promam: Amendments to 35 Ill. Adm. CodePart 217,R06-22 (Feb. 2, 2006)(Agencyproposal accepted for bearing). While theBoard will mail a copy of this hearing officer order to each of the entities on the R06-22 notice list, the Board will mail copies of any subsequent opinions and orders only to those who specifically indicatethat they wish to remain on the Notice List for this proceeding. 

### Any entity wishimgtoremain on the Notice List must provide the informationrequested inthe form attachedto this order as Attachment A and return the completed form to the Board by Friday, March 7,2008. In order to clarify the record in this proceeding, Attachment B to this order containsthenames and addresses of all of the entities to which the Board has mailed this first hearing officer order. Interestedpersons may now request electronic notice of filingsby providing their e-mail address through COOL under this docket number: R09-20. This electronicnotice includes notice ofthe filing of documentsthat are not typicallyprovided topersons on the Notice List. In addition, COOL provides links to documents filed with the Board, and those documents canbe viewed, downloaded,and printed free of charge as soon as they are posted to the Board's Web site.For more informationabout the option of electronic notice or COOL, consulteither the Board's Web site at www.ipcb.state.il.us or John Theniault, the Board's AssistantClerk, at (3 12) 814-3629. At the close of the second hearing, the hearing officer will set a date by which the record will close and all public comments must he submitted. See 

### 35 Ill. Adm. Code 102.108. 

### As the Board is aware that the Agency would appreciateBoard decision making as soon as possible, the post-hearing comment period will not be lengthy unless unanticipated circumstances dictate otherwise. 

### IT IS SO ORDERED,

Kathleen 

### M. Crowley 

## 1 Hearing Officer, Illinois Pollution Control Board 100West Randolph Street, Suite 11-500 Chicago,Illinois 60601 (312) 814-6929 crowlek@iucb.state.il.us

### ATTACHiMENTA To Hearing Officer Order of May 

### 13,2009 

### Nitrogen Oxide (NOxl TradingProgram SunsetProvisions for Electric Generating Units 

### [EGU's):New 35 111. 

### Adm. Code 217.751,R09-20

I wish to remain on the Notice List in the Pollution Control Board rulemaking proceeding listed above:

Name

Organization or Company

Address

City, State,Zip



### PLEASERETURN 

### THIS FORM BY MONDAY JUNE 1,2009 

### TO: Lynn Delaney E-mail: 

### de1aneylipcb.state.il.u~ Fax: 312-814-3669 Mail: 100W. Randolph St., Suite 11-500 James 

### R. Thompson Center Chicago, Illinois 60601

### ATTACHMENT

### B To Hearing Officer Order of May 13,2009 

### Nitrogen Oxide (NOx)Trading Program SunsetProvisions forElectric 

### Generating Units JEGU's): 

### New 35 111. 

### Adm. Code 217.751, R09-20 Attachment B consists of the ServiceList from the Board's proceedingin NOx Trading Prosam: Amendments to 35 Ill. Adm. CodePart 217, R06-22, and begins on thenext page:R2009-020 Rachel L. Doctors IEPA 1021North Grand Avenue East P.O. Box 19276 Springfield,IL 62794-9276

R2009-020 Matthew J. Dunn Office ofthe Attorney General EnvironmentalBureau North 69 WestWashington Street, Suite 1800 Chicago, IL 60602

R2009-020 Kathleen C. Bassi SchiffHardin,LLP 6600 SearsTower 233 South Wacker Drive Chicago, IL 60606-6473 R2009-020 Hodge Dwyer & Driver 3150 Roland Avenue Post Oftice Box 5776 Springfield,IL 62705-5776

R2009-020 Alec M. Davis Illinois EnvimnmentalRegulatory Group 215 EastAdams Street Springfield, IL 62701

R7.009-020 Virginia Yang Illinois Department ofNaturalResources OneNatural ResourcesWay Springfield, IL 62702-1271 

### Page 1of 1ILLINOIS POLLUTION CONTROL BOARD October 15,2009 IN THE MATTER OF: 

## 1 

## 1 NITROGEN OXIDE (NO,) TRADING ) R 09-20 PROGRAM SUNSET PROVISlONS FOR ) (Rulemaking 

### - Air) ELECTRIC GENERATING UNITS (EGUs): ) NEW 35 ILL. ADM. CODE 217.751 

## 1 Adopted Rule. Final Opinion and Order. OPINION AND ORDER OF THE BOARD (by S.D.Lin): On April 21,2009, the Illinois Environmental Protection (Agency) filed this proposal for rulemaking under Sections lO,27, and 28 of the Environmental Protection Act (Act), 415 ILCS 5110, 27,28 (2008). The proposal would add a single new section, 35 Ill. Adm. Code 217.751, to 35 Ill. Adm. Code 217.Subparl W. Beginning with any control period in 2009, the new section would "sunset", or render inapplicable, the provisions of the Nitrogen Oxides WO,) Trading Program for electrical generating units 

### (EGUs) found at 35 ISl. Adm. Code 217.Subpart W. But, the provisions of 35 Ill. Adm. Code 217.Snbpart W will remain in effect for violations that occurred in control periods prior to 2009. By order ofMay 7,2009, the Board denied the Agency's motion for expedited consideration. But, asthe Agency had also requested, the Board ordered immediate publication of the rilles for first notice in the IllinoisRegister under the Illillois Administrative Procedure Act (APA), 5 lLCS 10011-1 et seq (2008). See, respectively, 35 Ill. Ad~n. Code Sections 102.202(g)and 101.512.The proposal was publislied at 33 111. Reg. 8880 (June 26, 2009). The Board held hearings on the proposal onJune 18,2009and July 23, 2009, and received three public comments on or before August 25,2009. The Board adopted its second notice opinion and order on September 17,2009,adopt~ng the first notice proposal without substantive change. The Joint Committee on Administrative Rules voted a certificate of "no objection" at its October 14,2009meeting. By today's action, the Hoard adoptsnew Section 217.751 as a final rule, and directs that the adopted rule be filed with the Secretary of State, to become effective upon filing. The Board finds that this record demoilstrates that the proposed mle if adopted is tecl~nically feasible, economically reasonable, and, in the words of Section 27 (b)of the Act, will have no "adverse economic impact on the people ofthe state of Illinois." 415 ILCS 5!27(b) (2008). The proposal contains no substantive changes fro111 the first notice proposal. However, the table of contents of Part 217 has been revised to include Subparts 

### D through 

### 34,due to the recent colnpletioll of other air rulemakings. See, Section 27 Proposed Rules for Nitrogen Oxide (NO,) Emissions From Various Source Categories, Amendments to 35 Ill. Adm. Code Parts 21 1 and 217, R08-19 (Aug.20,2009). Adoption of the final rules today grants the request of the Agency and other participants that this rulemaking becompleted by the end of November 2009. This final opinion will set out the proposal for the adopted anlendmeiit and its background, and discuss the evidence presented and public commentsmade concenli~lg the economic reasonableness and technical feasibility of the rule. TEE PROPOSAL In the proposal's six-page statement ofreasons (SR),the Agency states that the Board adopted the Part 217 NO, Trading Program rules in Proposed New 35 111.Adm. Code 217. Subpart W, The NO, Trading Program for Electrical Generating Units, and Amendments to 35 Ill. Adm. Code 21 1 and 217. R 01-9 (Dec. 21,2000). SR. at 1. Part 217.SubpartW regulates NO, emissions from utility boilers or EGUs. Part 217.Subpart W received approval by the United States Environmental Protection Agency (US EPA) as part of the Illinois State Inlplementation Plan (SIP) for ozone onNovember 8,2001. See 66Fed. Reg. 56449 (Kov. 8, 2001). Illinois was required to regulate these sources pursuant to USEPA's NO, SIP Call for EGUs pursuant to Sections 110(a) (2) and 126 of the federal Clean Air Act (CAA) and 40 CFR 51.121. See also 63 Fed Reg. 57356 (Oct. 27, 1998). SR at 1-2. IEPA reports that the emissions reductions helped the two Illinois ozone nonattainment areas in Illinois to attain tile 1997 8-hour ozone National Ambient Air Quality Standard (NAAQS). In addition, the continued implementation ofthe federal NO,, Trading Program was required under Phase I of the 8-hour ozone implementation rule. See 40 CFR 51.905(f). Id. at 2. On May 12,2005,USEPA adopted the federal Clean Air Interstate Rule (CAIR) to replace the NO, SP Call Trading Program beginning with the 2009 control period and to add two new trading programs addressing annual elnissio~ls of NO, and sulfi~r dioxide. See Rule to Reduce Interstate Transpovt ojmFilze Particulate Matter and Ozone: Revisions toAcid Rain Progi,anz; Revisions to the NO, SIP Call, 70Fed. Reg. 25162 (May 12,2005). SR at 2. While the IEPA states that the Board adopted the CAIR rules in the still-pending R06-22 proceeding, in fact the CAIR rules were adopted by the Board in Proposed New Clean Air Interstate Rule CAIR) SOz. NOx A- Ozone Season Trading Programs, 35 Ill, Adm. Code 225, Lubparts

# AIC, 

# 6 E and F, R 06-26 (Aup.23.2W7) The CAIR rules, by their terms, were to replace the NO, Trading rules in 2009. The Illinois CAIR rules were approved by USEPA on October 16,2007, See 72 Fed. Reg. 58528(Oct. 16,2007). The CARprovisions as set forth in 35 111.Code 

### Paxt 225 .Subpart 

### E include a trading program for control of NO, emissions during the ozone season that replaces the provisions in Part 21 7.Subpart 

### W for EGUs beginning wit11 the 2009 control period (May 1through September 30) and thereafter. Part 225.Subpart E incorporated in large part applicable provisions from the federal CAIR n~le as required for federal approval. SR at 2. After the adoption of Illinois CAIR, the United States Court of Appeals reached a decision on a number of petitions for review it had received concerningthe federal CAIR rule. On July 11, 2008, the Court of Appeals vacated the federal CAIR rule in its entirety and remanded the rule to CSEPA for revision. North Carolina v. USEPA, 531 F.3d 896 (C.A.D.C. Cis. 2008). The court's July 2008 opinion stated that pending the remand of the CAIR programto USEPA, the provisions of the federal NO, SIF' Call Trading Program would remain in place. But, the partiespetitioned the court for rehearing on the decision to vacate and requested that the federal CAIR rule be reinstated during the remand. On December 23, 2008, the court granted the rehearing and "unvacated" the federal CAIR rule with ilnplelnelltationto begin with the original control period in 2009.Novtlz Caroli~za v. 

### USEPA, 550 F.3d 1176 (C.A.D.C. Cir. 2008). SR at 2- 3,' The Board's Past 217 NO, Trading Program rules have continued to be in full force and effect. The Agency statesthat, with the reinstatement ofthe federal CAIR program, Illinois' EGUs must now complywith two sets of duplicative administrative requirements (e.g., permitting, reporting) for the 2009 ozone season and beyond: namely, the Illinois CAIR rule requirenlents at Part 225 and the Illinois NO, Trading Program at Par1217. In 40 CFR 51.123(bb)(l)(i), USEPA has provided that states such as Illinois with approved CAIR programs may revise their applicable SIP so that the provisions of the NOx SIP Call Trading Program do not apply to affected EGUs. IEPA's proposal requesting the Board to amend the Illiliois rules is the first step to revision ofthe SIP. Upon completion of this rulemaking, IEPA may then submit rules to USEPA for formal approval and SIP inclusion.

To address and remove this duplication, the proposal would "sunset" the provisions ofthe NO, Trading Progran~, by adding a new Part 217.751. The full text of the proposed rule is: Section 217.751 Sunset Provisions The provisions ofthis Subpart W shall not apply for any control period in 2009 or thereafter. Nollcompliancewith the provisions ofthis Subpart that occursed prior to 2009 is subjectto the applicable provisions of this Subpart. ~ffective (Source: Added at 33 Ill. Reg. - L ) The Agency states that this proposal is consistent with the provisions of40 CFR 51.123@b)(I)(i),which provide that states with approved CAIR programs may revise their applicable SIP so that the provisions of the NO,, SIP Call Trading Program do not apply to affected EGUs. SR at 3. As to the scope ofthe rule, the Agency states that the entire State of ifli~lois was subject to the NO,, SIP Call and is now subject to CAIR. The proposed regulatiolls will affect existing EGUs. There are approximately 229 existing EGUs tllat are currently subject to the NO, SIP Call Trading Program. For the NO, SIP Call Trading Progra~n, existing units are those that commenced operation before May 1,2006. Ofthese units, 170 are gas and oil fired boilers, 50 are coal-tired boilers, and ihe remainder are gas and oil-fired combustion turbines. SR at 3. 

# ' Therehas been no final action by USEPA on its CAIR rules. The Board has never been asked to construe what effect, if any, the status ofthe federal CAIR rules has on the Board's Part 225 CAIR NO, rules.The statement of reasons indicates that the Agency did an electronic e-mail outreach to the 229 existing EGUs tl~at are subject to tile Part 217 NO, Trading Program mles, and has identified no significant issues. SR. at 4-5. The Agency accordingly concludes that the rule isbeing proposed to prevent a burden and replaces a rule that is no longer being implemented by USEPA. The adoption of the proposal will not result in illjury or substantial prejudice, nor an abrupt departure from a well established practice. Hence, adoption of this proposal is appropriate to prevent a burden on affected EGUs. The amendments to Part 217.Subpali W arebeing proposed to ensure consistency with the CAIR ozone season program and prevent EGUs from being subject to duplicative monitoring, reporting, permitting and recordkeeping requirements. USEPA has stopped allocating NO, allowances for the NO, SIP Call Trading Program. As this proposal sunsetsregulatory provisions, it would impose no new requirements or costs on affected sources. Hence, the proposal isboth technically and economically feasible. SR at 5. PROCEDURAL HISTORY As previously stated, the Agency filed this proposal on April 21, 2009. The Agency also filed a motion (Mot.) requesting the Board to expedite consideration of the proposal. See 415 ILCS 5128 (2008); 35 Ill. Adin. Code 102.202(g) and 101.512. The motion to expedite requested that the Board cause immediate first notice publication of the proposal under the APA, 5 ILCS 100 et seq. (ZOOX), without Board comment on the merits and schedule public hearings as so011 as possible. Mot. at 2-3. By order of May 7,2009,the Board denied the Agency's motion for expedited consideration, but did authorize first-notice publication of the proposal in the Illinois Registev without comment on the proposal's merits, and directed the hearing officer to promptly schedule hearings. Nitrogen Oxide (NO,) Trading Program Sunset Provisions for Elechic Generating Units (EGUts): New 35 111. ~dm. Code 217.751, R09-20 (May 7, 2009). By heariilg officer order of May 13,2009,hearings wene set for June 18, 2009 in Chicago and July 23,2009 in Springfield. "he hearing officer order also set deadlines for the pre-filing of testimony. By letter of October 18, 2008, the Board requested the Director of the Departnlent of Coinmerce and Economic Oppo~tunity (DCEO) to request an economic impact study (EcIS) concenlingthis rulemaking as required by Section 27 (b) ofthe Act. 415 ILCS 5/27(b) (2008). DCEO has not responded to the Board's request at any time. The first hearing was held in Chicago on June 18, 2009, conducted by Hearing Officer Kathleen 

### M. Crowley. At the first hearing, the Agency presented testimony timely pre-filed on

The transcripts for these hearings are not sequentially numbered. The transcript for tile first hearing willhe cited as "6118109 

### Tr." and the second as "7123109 Tr."June 1,2009hy Mr. Yoginder Mahajan. Mr. Mahajan has been employed by the Agency since March 1992 as 

### anEnvironmental Protection Engineer in the Air Quality Planning Section in the Bureau of Air. This testimony was also entered into the record as Exhihit 1. 6118109 Tr. at 8. Counsel for Midwest Generation,ICathleen Bassi of SchifMardin,LLP, posed questions concerning enforcement and distribution of unused allowances that Mr.Mahajanwas not prepared to answer. 6118109 Tr. 8-15. Counsel for the Agency, Rachel Doctors, stated that a~~other witness would he provided at the second hearing: David Bloomherg. 611 8/09 Tr. 9. Ms. Bassi represented that shemight file additional questions for the Agency to answer atthe next hearing. First notice pnhlicatioll ofthese rules appeared in the Illinoi~s Register on June 26,2009. See 33 Ill. Reg. 8880 (June 26,2009). This publication started the 45-day public commentperiod under the APA, requiring the Board to accept all comments filed through August 10,2009. By e-mail of July 8,2009, Ms. Bassi informed Ms. Crowley that she would not be filing any additional questions, and that Ms. Bassi might not he in attendance at hearing. On July 10, 2009, the Agency pre-filed the testimony of another witness, Mr. David E. Bloomberg. No other pre-filed testimony was received. The second hearing was held on July 23, 2009 in Springfield, conducted by IIearing Officer ~ehb.~ At the hearing, the Agency presented testimony timely pre-filed by Mr. Bloomberg. Mr. Bloomberg, an Agency e~nployee for nearly 18years, for the last five years has beell the Compliance Unit Manager in the Compliance Section within the Agency's Division ofAir Pollution Control. The Bloomherg testimony was also entered into the record as Exhibit 2. 7123109 'rr. at 8. No questions were asked of Mr. Blooinherg. The hearing officer noted that DCEO had not responded to the Board's May 13,2009 Ecls letter. The hearing officer relayed that Section 27(b) requires the Board to hold a hearing on the economic impact of the rules, any EcIS submitted, and on any explanation DCEO provides for not conducting an EcIS. The hearing officer also explained that Section 27(h) allows the Board to dovetail the economic impact healing with any other hearing. 7/23/09 Tr. at 5-6. The hearing officer asked whether any person wished to address EcIS issues, and no one responded. 7/23/09Tr. at 8-9. Section 102.108 (b) of the Board's procedural rules also provides that the Board will accept comments for 14days after the receipt of the heanng transcript, or at any other date set by the hearing officer. The close of the comment period was set for Friday, August 21,2009. 7/23/09 Tr. at 14. The first post hearing comment (PC 1)was timely filed by Southem Illinois Power Cooperative (SIPC) on August 21,2009. SIPC suggested changes lo the proposal that would haverequired the Agency to disburse allowances. The Agency filed a comment and response in opposition to the SIPC comment on August 25,2009 (PC 2); this was accoinpanied by a motion 

# 'I-Iearing Officer Crowiey explained that the second hearing might he conducted by Springfieldbased Hcariilg Officer Carol Webb, to economize on Board travel expenses. 6/18/09 Tr. at 23.for leave to file, which is here granted. Also on August 25, 2009, SIPCresponded by e-mail to the Agency's query as to whether it would accept e-mail service. SIPC agreed that it would, but disagreed with the Agency's statement of facts; this e-mail was docketed as PC 3 to allow for consideration of SIPC's substantive remark. The Board adopted its second notice opinion and order on September 17,2009. JCAR coilsideredthe rule at its October 14,2009 meeting, and voted a certificate of no objection. HEARING TESTIMONY Mahaian Testimony As previously stated, the only witness at the first hearing was the Agency's Yoginder Mahajan. Mr. Mahajan has been employed sinceMarch 1992 as an Environmental Protection Engineer in the Air Quality Planning Section in the Bureau of Air. He worked for various metal fabrication companies for nine (9) years. Mr. Mahajan's educational background includes a Bachelor of Engineering Degree in Mechanical Engineering horn Bhopal University at Bhopal. India. Prior tohis employment by the Agency, Mr.Mahajan worked for various metal fabrication companies for nine years. Exh. 1 at 1. As part of his regular duties in the Air Quality Planning Section, Mr. Mahajan has been involved with preparing emissions estimates forvarious source categories used in the development of the 1990 ozone season weekday emissions inventories; evaluating control technologies applicable to VOM emissions sources utilized in the preparation ofthe Rate-ofProgress plans for the Chicago and St.Louis ozolle nonattainment areas; and assisting in the develop~nent of regulations for the control of VOM emissions from the source categories included in the Rate-of-Progress plans. Regarding the R09-20 proposal, Mr. Mahajail testified that he has been involved in the development of the regulations to control nitrogen oxides (NOx) emissions from electrical generating units. Exh. 1 at 1. Mr.Mahajan related that therules adopted in Proposed New 35 Ill. Adm. Code 217. Subpart W. The NO, Trading Propram for Electrical Generatinp Units. and Amendments to 35 Ill. Adm. Code 21 1 and 217, R 01-9 (Dec. 21,2000) were intended to comply with the NOx SIP Call promulgated by USEPA in October 1998. See 63FR 57356 (October 27,199S). TheNOx SIP Call Trading Program was an ozone season trading program administered by USEPA. USEPA adopted the federal CAIR rules in 2005. See 70 FR 25162, May 12,2005. The Board adopted Illinois CAlR rules in Proposed New Clean Air Interstate Rule (CAIR) SOz,PdOn Annual and NO, Ozone Season Trading Promams. 35 Ill. Adm. Code 225, SubpartsA. C, D, E 

### &, R 06-26 (Aug.23,2007). The sources affectedby CAlR are the same electrical generating units that were affected by the NO, SIP Call rules in Subpart W of 35 Ill. Adm. Code 21 7. The NOx SIP Call rules and CAIR are cap and trade programs that require affected sources to hold NOx allowances equal to their NO, emissions. Themonitoring and reporting of NO, emissions in both programs are substantially identical. Mr. Mahajan testified that, for Illinois, USEPA allocated 30,701 NO, allowances in Phase I of the CAIR ozone season NOx trading budget. This is the same number ofNO,allowances allocatedin the NOx SIP Call trading budget. After deducting 30% of the allowances for the new unit set-aside and clean air set-aside, the Agency allocated 21,491 NO, allowances for each ozone season in 2009 through 201 1to the 249 affected units pursuant to procedures set forth at Part 225. Subpart E. The estimated NO, enlissionsreductions from NO, SLP Call were 85,777 per year from 2007 base year NO, emissions. In Phase 11of CAIR, starting with the 2015 ozone season,USEPA allocated 28,981 NO, allowances per ozone season. Mr. Mahajan stated that the Agency believes that the CAIR NO, ozone trading will provide reductions in NO, emissions equal to or greater than the estimated reductions in NO, emissions achieved from the NO, SIP Call rules. In the preamble to the CAIR rule published at 70 FR 25162 (May 12,2005),USEPA stated that 11would not administerthe NO, SIP Call Ozone Season Trading Program after September 30,2008. CAIR provided for theNO, SIP Call Tradmg Program to be replaced by the CAIR Ozone Season

### NO, Trading Program. As to the specificsof the R09-20 proposal, Mr. Mahajan noted that the proposed Sunset Provisions, Section 217.751 of 35 Ill. Adm. Code would require that the provisions of Subpart W not apply for any control period in 2009 orthereafter. Noncompliance with the provisions that occurred prior to 2009 would remain subject to the applicable provisions of SubpartW. Adoption of this proposal will eliminate duplicate requirements for the affected sources. Mr. Mahajan statedthat the Agency that this proposal is consistent with U.S. EPA's requirements and it will not adversely impact the affected sources or the air quality in Illi~lois. Counsel for Midwest Generation, Kathleen Bassi of Schiffllardin, LLP, posed questions concemillg enforce~nent and distxibution of unused allowances that Mr. Mahajan was not prepared to answer. 6/15/09 Tr. 8-15. Counsel for the Agency, Rachel Doctors, stated that another witness would be provided at the second hearing: David Bloomberg. 611 8/09 Tr. 9. Mr. Mahajan clarified units ofmeasurement in his testimony in response to questions from the Board. After the close of questioning, counsel for the Agency stated that the Agency "hoped" that the rule could be "fully adopted" no later than November 30,2009 Tr. at 20. Counsel for Midwest Generation stated the client does support this sunsettingrule proposal. And we appreciatethe Agency's concern with the double 

### -- the duplicative requirements that would apply otherwise. And so, November 30th is a really good target date, so there's not double recordkeepingto be done. Tr. at 21. Bloombere Testimonv Mr. David E. Bloomberg appeared at the second hearing to provide testimony regarding questions that arose during the first hearing on this matter. Mr. Bloomberg remarked that, while the issue of distributionof allowances goes beyond the intended scope ofthisrulemaking,he was providing background testimony at the request of the Board. Mr. Bloomberg has served for the last 5 years as the Compliance Unit Manager in the Compliance Section within the Agency's Division of Air Pollution Control. He was previously an Environmental Protection Engineerinthe Air Quality Planning Section for twelve and a half years. Mr. Bloomberg's academic credentials include a Bachelor of Science degree in ceramic engineering from the University of Illinois at Champaign-Urbana, as well as coinpletion of all graduate coursework required for a Master's dcgree inthe same field. Exh. 2. at 1. Mr. Bloomberg stated that, among other duties, he supervised Illinois' portion of the now-defunct NO, trading program run under the NO, SIP Call, as well as supervisingIllinois' portion of the current CAIR NO, trading program. Both of these programs involved determining or approving the detes~nination of which sources are eligible to receive certain types of allowances, such as early reduction credits andnew source set-asides; determining or approving the determination of apportionment of allowances given to such sources or to other sources eligible to receive allowances; collecting or overseeing the collection of monies for sales of certain NO, allowances; informing USEPA how to distribute NO, allowances to Illinois sources; serving as the designated account representative Car the Stateof Illinois; answering questions concerning the Illinois NO, rules; and related tasks. Exh. 2. at 1. Mr. Bloomberg relayed that, in addition, as manager of the Compliance Unit, he approves Agency reviews of esnissionsand ~nonitors testing conducted for sources subject to NO, regulations,participates in decisions regarding enforcement ofthe Board's air pollution regulations, interacts with USEPA regarding federal enforcement cases in Illinois, and oversees the process of sending out Violation Notices andelated activities. During his tenure at the Agency, Mr. Bloomberg has been involved in designing, writing, implementing, and enforcing a wide variety of air pollution regulations, including those for NO, trading, CAIR, mercury, the Emissions Reduction Market System (ERMS), and several industry-specific rules. Exh. 2. at 1. Mr. Bloomberg first addressed whether the last truly applicable provisions of 35 Ill. Adm. Code.Subpart W occurred atthe end of the 2008 ozone season. Mr. Bloomberg stated that "The answer to this is yes, if this rulemaking goes through." With CAlR replacing the NO, SIP Call trading program, there are no more NO, SIP Call allowa~~ces and thus no requiremesltsrelating to such. However, Mr. Bloomberg clarified that there are recordkeeping and reporting requirements which would be duplicative and potentially contradictory with CAIIirequirements for affected sources, which is a major reason the Agency has proposed this sunset rulemaking. Exh. 2. at 1. Mr. Bloomnberg next addressed the question of whether the Agency presently knows, or would know within a shod time period whether or not there have been violations under 35 111. Adm. Code.Subpart W. Mr. Bloomberg in the negative, stating there is no guarantee the Agency would know in a shodtime period whether or not there were violations. Sometimes, it may take several years to determinethat such a violation took place. For example, in one case, an emissions test had been completed incorrectly hut the problcms were not determined for two or three years. Once they were, the source's NO, enlissions for the past several years had to be recalculated, causing the source to be in noncompliance with the NO, SIP Call trading program ror those previous years. At least one other case similarly involved noncompliance that was discovered two or more years afler the NO, allowances should have been provided. For this reason, Mr.Bloomberg believes it is necessary to retain the SubpartW regulations in order to preserve the Agency's ability to enforce these regulations, should situations arise where 

### it becomes necessary. Mr. Bloomberg believes this is a fairly standard practice when revising airpollution regulations, and stated tliat he has been involved in several rulemakings where regulations were changed but older versions of the regulations were maintained on the books for precisely this enforcement purpose. Exh. 2. at 2. Mr. Bloomberg then testified as to whether all allowances that have been provided by USEPA to Illinois under the NO, SIP Call program been distributed to EGUs. Mr. Bloomberg said that The answer to that is no, because the current regulatio~ls do not provide for such distribution. The correct number of allowances greater than three percent (3% ) of the New Source Set-Aside PSSA) is in the process of being distributed to EGUs, pursuant to 35 Ill. Adm. Code 217.764 and 217.768. However, that is the only pertinent distribution provided for under these regulations.As such,this also answers another question,which is wheil the other allowanceswill be distributed -they will not, until and ullless the Agency makes a decisiolito do so and a new regulation is passed by the Board to provide for such. However, the Agency is not seeking authority to distribute such allowances at this time and, as noted previously, such allowance distribution falls outsidethe scope ofthis rulemaking. The same answer also applies to the final question that was raised, asking if there are other allowancesfalli~~g outside the umbrella of those already described.There are some other allowa~~ces that reside in Illiiiois' account for which no distribution is currently planned. Some ofthese are from the non-EGUtrading budget under Part 217.SubpartU 

### ,some are for allowancesthat were part of some other distribution but were left over due to roundingwhen allocating on a pro-rata basis. These allowances would presumably be addressed in the sanemanner as described earlier. Exh. 2. at 2. Finally, Mr.Blooml>erggave verification that NO, SIP Call allowances indeed became CAIR allowances. Exh. 2. at 2.

PUBLIC COMMENTS

In its public comment, signed by Leonard 

### F. Hopkins, P.E., Southern Illinois Power Cooperative (SIPC) stated that SIPC is an entity affected by the proposed rulemaking which participated inthe Agency's pre-proposal out~each program. SPCoperates a coal-fired power plant located near Marion, niinois, and is subject to the NO, Tradiug Program rules at 35 Ill. Adm. Code Part 217.Subpart W as well as the Illinois CAIR rules at 35 Ill. Adni Code Part 225, Subparts D and 

### E, and the Illinois mercury rule, 35 Ill. Adm. Code Part 225.Subpart B. PC 1 at

SII'C generally supports the Agency's proposal to sunset the provisions of Part 217. SubpartW, and agrees that the duplicative recordkeeping and reporting created by the NO, Seasonal CAEare unnecessary and burdensome. PC 1at 1. However, as SIPCtold the Agencyduring outreach, SIPCbelieves that if the Board is going to sunset SubpartW, it should do it completely. That is, the Board should, in this rulemaking, address the distribution ofNO, Budget allowances renlaining in the Agency's account.

. 

### . .Sincethe authority to distribute allowances lies in the Board's rule, then the Board can alter that authority in this sunset rulemaking by providing that the Agency distribute all remainingNO, allowances. To accomplish this, SIPC suggests the following language: The provisions of this Subpart W shall not apply for any control period in 2009 orthereafter. All allowances remaining in the Agencv's accounts shall be distributed pursuani to the provisiolls of Section 217.7641h)(4)(A)and (B) of this Subpart. Noncompliance with the provisions of this Subpart that occurred prior to 2009 is subject to the applicable provisions of this Subpart. PC 1at 1-2 (underlining of new proposed language in original). SfPC contends that if the Board does not address distribution ofthe remaining 

### NO, allowances in this rulemaking, then either the Board will have to hold a second rulemaking to address this deficiency in this proposed rule or the allowances will, effectively through neglect, be subject to the retirementprovisions of the CAIR rules, citmg 35 111.Adm.Code225.545(i) and 225.575@)(4). PC 2 at 2. SIPC suggests tl~at Subpart W generally provided for distribution of excess allowances to existing electric generating units, while CAIR focuses on the retirement of excess ailowances.Icl. SIPC states that These are dianletrically opposed means of addressing excess allowances. The Agency's direction in Subpart W should continue to apply to the remaining NO, Budget allowances rather than allowing the Agency to apply the direction of the CAIRby not addressing disposition ofthe remaining ailowances at this time. This issue is properly before the Board at this time, as the question of the unallocated allowances was raised at the first hearing and addressed in testimony at the second hearing (citations omitted). There are a total of at least 1,212New Source Set-Aside ("NSSA") allowances remaining plus a number of allowances from the general pool not distributed dueto rounding. See Agency Trading website: 

### <www.epa.state.il.us/airinoxi> and <www. 

### epa.state.il.us/air/~~ox/allowances.hhnl. In 2007 and 2008, the Agency set aside 614 allowances into the NSSA~. 35 Ill. Adun. Code 

# 5 217.760(a)(2). 011ly 16 allowances were distributed from the NSSA in 2007, and none were distributed in 2008, leaving 1,212nndistributed allowances in the NSSA. PC 1 at

4 PC 1 contains a footilote 1 at this point in the original tcxt which reads "This information was on the Agency's website shortly after the June 18hearing, but has siuce apparently been removed." PC 1 at 3.SIPC concludes that it is timely and appropriatefor the Board to address the issue ofthe undishibuted NO, Budget allowances remaining in the Agency's account, and SIPC requcsts that the Board amend the proposed rulemalting with the addition of direction to the Agency to distribute the remaining NOx Budget allowa~~ces. PC1 at 3. PC2: the Aeencv In PC 2, the Agency responds to SIPC's assertions in PC l (referringto the commenter as SLPCo). In summary,the Agency requests that the Board adopt the rule as proposed at first notice. The Agency states that SIPCo is requesting that Board addressthe distribution ofNOx Budget allowa~~ces remaining in the IllinoisEPA's account. SIPCoraises the specter that if the allowances are not distributed pursuant to this rulemaking they will be retired under 35 Ill. Adm. Code Section 225.545(i) or 225.575(b)(4).This is false because the transfer ofthe NO, SIP Call allowances &omthe IllinoisEPA's NO, budget account to its Clean Air Interstate Rule ("CAIR") NO, Ozone Season accountby the United StatesE~lvironmental Protection Agency ("USEI'A") does not confer any additional authority on the Illi~lois EPA to distribute or retire these allowances beyond the authority originally given by the Board under SubpartW. In addition, the Board has not given the Illinois EPA the authority under either Section 225.545(i) or 225.575(b)(4)to retire NO, SIP Call allowances. Section 225.545(i) applies to allowances from the CAlRNew Unit Set-Aside ('?\IUSA"). As the NO, SIP Call allowances are not part of the CAIR NO, Ozone Season Budget as set forth in Section 225.525, these allowances are not part ofthe portion ofthe budget that has been set-aside for new-units in 2009, hence, these allowances are not subjectto the retirement provisions of subsection (i) of Section 225.545(i). Similarly, Section 225.575@)(4) refers to allowancesthat have been portioned from the CAIR NO, Ozone Season Budget for the Clean Air-Set Aside ("CASA"). As the NO, SIP Call allowances are not part of the CAIR budget, tiley cannot be distributed under the CASA provisions and are not subject to the provisions ofthat Section. Just because the allowances in question were New Source Set-Aside allowancesunder theNO, SIP Call does not make tllem allowances in the NUSA under Illinois' CAIR program. There is no provision for such allowances to he hailsfel-red into the NUSA category, because there is no provisioll for how these allowances will be treated under the CAIR program. PC 2 at 1-2. The Agency does not believe that a second rulemaking will be needed if the allowances that were not allocated under the NO, SIP Call trading program are not addressedin this docket. The Agency states that it will he reopening Part 225 after USEPA addresses the vacatur and remand of the CAIR rule under the North Cn~,olina v.EPA, No. 05-1244 (D.C. Cir. 2008) decisioil.PC 2 at 2.The Agency strongly disagrees with SIPC's contention that this rulemaking provides an appropriate vehicle for considering the issue of the u~lallocated allowances. The Agency reminds that it has repeatedly stated that the unallocated allowances are outside the scope of its proposal here. The Agency argues that SIPC has never put forth a properjustification for this proposal at the appropriate point in this rulemaking, and has failed to nlake any assertion that it would be prejudiced by waiting for the Agency to address this issue in a later proposal. The Age~lcy suggests that interested persons have had no opportunity to address the merits of SIPC's proposal, suggesting the proposal is faulty: Further, it should be noted that SIPCo's proposed amendment that provides "All allowances remaining in the Agency's accounts shallbe distributed pursuant to the provisions of Section 217.764(b)(4)(A) and (B)," does not address the issue as it applies only to the fourth year of the program (2007) which has passed. Hence, the adoption of such amendment would result in no distributions whatsoever as the fourth year of the program has come and gone. PC 2 at 3. The Agency urges that no changes to the proposal are necessary at this time and that no prejudice will result from bundling an amendment to distribute these allowances (should such an amendment be deemed appropriate at that time) with a future Agency proposal for amendments to Part 225, The Agency continues to believe that SIPC's proposed amendment falls beyond the scope of the current rulemaking. The Agency requests that the Board adopt the proposed rules to address substantive and duplicative requirements that face both the Agency and affected EGUs. PC 2 at 3 PC3: SIPC When filing PC2, the Agency addressed electronic copies to persons on the service list, stating that it would supply hard copies to anyone who objected to such service. SIPCreplied to the Agency and the Board; the reply was docketed asPC 3 duetothe nameofthe reply. PC3 states in its entirety: The electronic service is fine. While I disagree with your opinion of the facts, there isno need to waste paper with a hard copy for the sake of service. Also, there certainly was no intent on the part of SIPC to wait until the last minute with these comments, but there have been a large number of environmental issues this summer that has absorbed the time of our VERY small staff (2). PC3 DISCUSSION Ah73 CONCLUSION The facts presented here are clear. The entire State of Illinois was subject to the NO,, SIP Call and is now subject to CAR. The proposed amendment to 35 111. Adm. Code 217.Subpart W will affect existing EGUs. There are approximately 229 existing EGUs that are cun-entlysubject to the NO, SIP Call Trading Program. For the NO, SIP Call Trading Program, existing units are those that commenced operation before May 1,2006. Ofthese units, 170 aregas and oil fired boilers, 59 are coal-fired boilers, and the remainder are gas and oil-fired combustionturbines. SR at 3. Only two ofthe 229 EGUs affected have commented in this rulemaking: Midwest Generation and SLPC. Both support the language ofthe Agency proposal, although SIPC argues that it does not go far enough. While economicbenefits have not been quantified in this record, the Agency and commenters agree that removal of duplicative requirements will present an economic benefit in the form ofreduced recordkeep~ng and reporting. The Board finds that the facts presented in support ofthe Agency's proposal are uncontroverled. USEPA has stopped allocatingNO, allowances for the NO, SIP Call Trading Program. The amendments to Part 217.SuhpartW are being proposed to ensure colisistency with the CAIR ozone season program and prevent EGUs froin being subjectto duplicative monitoring, reporting,pennitting and recordkeeping requirements. As this proposal sunsets regulatoryprovisions, it would impose no new requirements or costs on affected sources. The Board accordingly finds that this record demonstrates that the proposed rule if adopted is technically feasible, economically reasonable, and, in the words of Section27 (b) ofthe Act, will have no "adverse economic impact onthe people ofthe state of Illinois." 415 ILCS 5127(b) (2008).The 2009 ozone season controlperiod (May 1,2009,through Septe~nber 30,2009) is over. But, the record is also clear that it would be beneficial if the proposed rules are adopted and effective on orbefore November 30, 2009. The Board finds that it would be impossible to conclude this sulemakingunder that timetable ifthe Board were to consider the issue of unallocated allowances now. The Board declines to add the languageproposed by SIPC. As the Agency points out, the regulated community and members of the public have had no meaningful opportunityto comment on whether the issue of unallocated allowances should be addressed in Part 217 at all, let alone by insertion of the language as proposed by SIPC. SIPC has failed to supporl its proposed additional languagewith convincingevidence and argument. If SIPC believes that it cannot wait for the Agency to address this issue in some future rulemaking to amend 35 Ill. Adn~. Code Part 225, SIPC is free to file a regulatory proposaltlmt complies with the requirements of Section 27 of the Act and the Board's procedural mles at 35 Ill. Adm. Code 102. For all ofthe foregoing reasons, the Board adopts as a final nlle Section 217.751 set forth below. The rule text itself is unchanged since first notice publication. But, the table of contents of Part 217 now lists Subparts D through M, added in rulemakings completed during the pelldelicy of this R09-20 proceeding. See, Section 27 Proposed Rules for Nitrogen Oxide (NOx) EmissionsFrom Stationa~ ReciprocatingInternal Combustion Engines and Turbines: Amendmentsto 35 Ill. Adnl. Code Parts 21 1and 217, R07-19 (July 23,2009) and Nitrogen Oxides Emissions From Various So~~rce Categories, Amendmei~ts to 35 Ill. Adm. Code Parts 21 1 

# a, R08-19 (Aug. 20, 2009).ORDER The Board directs the Clerk to submit the following adopted rules to the Secretary of State for filing, to become effective upon the date of filing: TITLE 35: ENVIRONMENTAL PROTECTION SUBTITLE B: AIR POLLUTION CI-IAPTER 1: POLLUTION CONTROL BOARD SUBCHAPTER c: EMISSION STANDARDS AND LIMITATIONS FOR STATIONARY SOURCES PART 217 NITROGEN OXIDES EMISSIONS SUBPART A: GENERAL PROVISIONS Section 217.100 Scope and Organization 217.101 Measurement Methods 217.102 Abbreviations and Units 217.103 Definitions 217.104 Sncorporationsby Reference SUBPART 

### B: NEW FUEL COMBUSTION EMISSION SOURCES Section 217.121 New Emission Sources (Repealed) SUBIJARTC: EXISTING FUEL COMBUSTION EMISSION UNITS Section 217.141 Existing Emission Sources in Major Metropolitan AI-eas SUBPART

### D: NO, GENERAL REQUIREMENTS Section 217.150 Applicability 217,152 Compliance Date 217.154 Performance Testing 217.155 Initial Compliance Certification 217.156 Recordkeeping and Reporting 217.157 Testing and Monitoring 217.158 Emissions Averaging PlansSUBPART E: INDUSTRIAL BOILERS Section 217.160 Applicability 217.162 Exemptions 217.164 Emissions Limitations 217.165 Combination ofFuels 217.166 Methods and Procedures for Combustion Tuning SUBPARTF: PROCESS HEATERS Section 217.180 Applicability 217.182 Exemptions 217.184 Emissions Limitations 217.185 Combination ofFuels 217.186 Methods and Procedures for Combustion Tuning SUBPART G: GLASS MELTWG FURNANCES Section 217.200 Applicability 217.202 Exemptions 217.204 Emissions Limitations SUBPART 11: CEMENT AND LIME KII.NS Section 217.220 Applicability 217.222 Exemptioils 217.224 Emissions Limitations SUBPART

### I: IRON AND STEEL AND ALUMINUM MANUFACTURING Section 217.240 Applicability 217.242 Exemptions 2 17.244 Emissions Limitations

SUBPARTK: PROCESS EMISSION SOURCES Section 217.301 Industrial ProcessesSUBPART M: ELECTRICAL GENERATING UNITS Section 217.340 217.342 217.344 217.345

Section 217.381

Section 217.386 217.388 217.390 217.392 217.394 217.396

Section 217.400 217.402 217.404 217.406 217.408 217.410

Section 217.450 217.452 217.454 217.456 217.458 217.460 217.462 217.464 217 466 Applicability Exemptions Emissions Limitations Combination of Fuels SUBPART0: CHEMICAL MANUFACTURE Nitric Acid Manufacturing Processes SUBPART Q: STATIONARY RECIPROCATING INTERNAL COMBUSTION ENGINES Ah'D TURBINES Applicability Control and Maintenance Requirelnents Emissions Averaging Plans Compliance Testing and Monitoring Recordkeeping and Reporting SUBPART T: CEMENT KILNS Applicability Control Requirements Testing Monitoring Reporting Recordkeeping SIJBPART

### U: NO, CONTROL AXD TRADING PROGWM FOR SPECIFIEDNO, GENERATING UNITS Purpose Severability Applicability Compliance Requirements Permitting Requirements SubpartU NO, Trading Budget Methodology for Obtaining NO, Allocations Methodology for Determining NO, Allowances f'orn the New Source Set-Aside NO, Allocations Procedure ihr Subpart U Budget 'CJnitsSection 217.521 217.700 217.702 217.704 217.706 217.708 21 7.710 217.712

Section 217.750 217.751 217.752 217.754 217.756 217.758 217.760 217.762 New Source Set-Asides for "New" Budget Units Early Reduction Credits (ERCs) for Budget Units Low-Emitter Requirements Opt-In Units Opt-ln Process Opt-In Budget Units: Withdrawal from NO, 'Trading Program Opt-ln Units: Change in Regulatory Status Allowance Allocatio~ls to Opt-In Budget Units SUBPART V: ELECTRIC POWER GENERATION

Lake of Egypt Power Plant Purpose Severability Applicability Emission Linlitations NO, Averaging Monitoring Reporting and Recordkeepillg SUBPAR?' 

### W: NO, TRADING PROGRAM FOR ELECTRICAL GENERATING UNITS Purpose Sunset Provisions Severability Applicability Co~llpliance Requirements Permitting Requirements NO, Trading Budget Methodology for Calculating NO, Allocations for Budget Electrical Generating Units (EGUs) NO, Allocations for Budget EGUs New Source Set-Asides for "New" Budget EGUs Early Reduction Credits for Budget EGUs Opt-In Units Opt-In Process Budget Opt-In Units: Withdrawal from NO, Trading Program Opt-In Units: Change in Iiegulatory Status Allowance Allocatioi~s to Budget Opt-In UnitsSection 217.800 217.805 217.810 217.815 217.820 217.825 217.830 217.835 217.840 217.845 217.850 217.855 217.860 217.865 SUBPART

### X: VOLUNTARY NO, EMISSIONS REDUCTION PROGRAM Purpose Emission Unit Eligibility Participation Requirements NO, Emission Reductions and the subpart X NO, Trading Budget Baseline Emissions Determination Calculation of Creditable NO, Emission Reductions Limitations on NO, Emission Reductions NO, Emission Reduction Proposal Agency Action Emissions Determination Methods En~issions Monitoring Reporting Recordkeeping Enforcement Rule into Section Table Section into Rule Table Compliance Dates Non-Electrical Generating Units Large Non-Electrical Generating Units Allowances for Electrical Generating Units Existing Reciprocating Internal Colnbustion Engines Affected by the NO, SIP Call Compliance Dates for Certain Emissions Units at Petroleum Refineries AUTHORITY: Implel~lenting Sections 9.9 and 10 and authorized by Sections 27 and 28.5 of the Et~vironmental Protection Act [415 ILCS 519.9, 10,27and 28.5 (2004)l. SOURCE: Adopted as Chapter 2: Ail. Pollution, Rule 207: Nitrogen Oxides Emissions, R71-23, 4 PCB 191,April 13, 1972,filed and effective April 14, 1972; amended at 2 Ill. Reg. 17,p. 101, effective April 13, 1978;codified at 7 Ill. Reg. 13609; amended in R01-9 at 25 Ill. Reg. 128, effective December 26,2000; amended in ROl-I l at 25 Ill. Reg. 4597, effective March 15,2001; amended in R01-16 and R01-17 at 25 Ill. Reg. 5914, effective April 17,2001;amended in R07- 18at 31 Ill. Reg. 14271, effective September 25, 2007; amended in R07-19 at 33 Ill. Reg. 11999, effective August 6, 2009; amended in R08-I9 at 33 Ill. Reg. 

### , effective amended in R09-20 at 33 Ill. Reg. 

# .effectiveSlJBPARTW: NO, TRADING PROGRAM FOR ELECTRICAL 

### GENERATING UNITS Section 217.751 Sunset Provisions

applicablewovisions ofthis Subpart. (Somce: Added at 33 111. Reg. 

### -, effective 

### - 

## 1

I, John 

### T. Therriault, Assistant Clerk of the Illinois Pollution ControlBoard, certify that the Board adopted the above opillio~l and order on October 15,2009,by a vote of 5-0.

John T. Theniault, Assistant Clerk Illinois Pollut~on Control Board

### BEFORE THE ILLINOIS POLLUTION CONTROL BOARE)



### IN THE MATTER OF: 

## 1 1 NOX TRADING PROGRAM SUNSET ) 

### R09- PROVISIONS FOR ELECTRIC ) 

### (Rulemaking 

## - Air) GENERATING UNITS (('EGUS") 

## 1 AMENDMENTS TO 35 

### ILL. ADM. CODE PART 217.SUBPART W ) 

### TABLE OF CONTENTS OFREGULATORY SUBMITTAL Following is a Table of Contents of all pleadings and documents included with the proposed regulatory action: 1. Notice of Proposal 2. Appearance ofRachel 

### L. Doctors, Assistant Counsel, for the Illinois Environmental Protection Agency 3. Director Douglas Scott's Proposal of Amendments 4. 

### Economic and Budgetary Analysis 6. Statement of Reasons 

### 7. First Notice 8. 

### Proposed Amendments to 

### 35 111. Adm. Code 

### Part 217.Subpart 

### W: 9. Synopsis of Testimony 10. Motion to Expedite 11. Outreach Exhibits:

I. 

### First e-mail sent from Rob Kaleel dated March 19, 2009 ii. Second e-mail sent from Rob Kaleel dated March 19. 2009



### 12. Documents Relied 011 

### "a. Illinois Environmental Protection Act (415 

### ILCS 5let. seq.)

### *b. The Clean Air Act, as amended in 1990 (42 U.S.C. $7401 et seq.) kc. Rule to Reduce Interstate Transport ofFine Parliculate Matter and Ozone (Clean Air Interstate Rule); Revisions to Acid Rain Program;Revisions to the NOx SIP Call; Final Rule, 70 Fed. 

### Reg. 25162 (May 12,2005) 

### "d. Approval and Promulgation of Air Quality ImplementationPlans; Illinois; Oxides of Nitrogen Regulations, 66 Fed. Reg. 

### 56454 (November 8,2001) *e. Approval of I~nplementation Plans of Illinois; Clean Air Interstate Rule, 72 Fed. Reg. 58528 (October 16,2007) "f. North Cavolina v. 

### USEPA,531 F.3d 896 (C.A.D.C. Cir. 2008) "g. Novth Carolina v. 

### USEPA,550 F.3d 1176(C.A.D.C.Cir. 2008) 13. Certificateof Service "Copies of documents with an asterisk beside the letter have not been provided

### BEFORE THEILLINOIS POLLUTION CONTROL BOARD

IN THEMATTER OF: 

## 1 1 NO, TRADING PROGRAM SUNSET ) 

### R09- PROVISIONS FORELECTRIC 

## 1 (Rulemaking 

## - Air) GENERATING UNITS ("EGUS") 

## 1 AMENDMENTS TO 

### 35 

### ILL. 

## 1 ADM. CODE PART 217.SUBPART 

### W ) 

### NOTICE TO: John Therriault, Assistant Clerk Matthew Dunn, Chief Illinois Pollut~on Control Board Attorney General's Office State of Illinois Center James R. Thompson Center 100West Randolph, Suite 11-500 100West Randolph, 12thFloor Chicago, Illinois 60601 Chicago, Illiilois 60601 Virginia Yang Deputy Legal Counsel Illinois Dept. ofNatural Resources 524 South Second Street Springfield, Illinois 62701-1787

PLEASE TAKE NOTICE that I have today filed with the Office ofthe Pollution Control

ILL. 

### ADM. CODE PART 21 7.SUBPART W, APPEARANCE, MOTION TO EXPEDITE, and AFFIRMATION ofthe Illinois Env~ronmental Protectiot~ Agency a copy ofwhich is herewith served upon you. ILLlNOIS ENVIRONMENTALPROTECTION AGENCY

DATED: P.O. Box 19276 Springfield, Tllinois 62794-9276 By: Rachel 

### I,. Doctors Assistant Cou~isel Division of Legal Counsel

### BEFORE THE ILLINOIS POLLUTION CONTROL BOARD

IN THE MATTER OF: ) 

## 1 NO, TRADING PROG SUNSET ) 

### R09- PROVISIONS FOR ELECTRIC 

## 1 (Rulemaking 

### - Air) GENERATING UNITS ("EGUS") ) 

### AMENDMENTS TO 35 ILL. 

## 1 ADM. CODE PART 217.SUBPART W )



### APPEARANCE The undersigned, as one of 

### its attorneys, hereby enters ail Appearance on behalf of the Illinois Environmental Protection Agei~cy.

ILLINOIS ENVIRONMENTAL PROTECTION 

### AGENCY By: Rachel L. 

### Doctors Assistant Counsel Division of Legal Couilse!



### DATED : 

### P.O. Box 19276 Springfield, Illinois 62794-9276 2171782.5544

### Agency Analysis ofEconomic and Budgetary Effects of Proposed Rulemaking Agency: Illinois Pollution Control Board PartJTitle: Nitrogen Oxides Emissions (35 Ill. Adm. Code Part 217 ) Illinois Register Citation: Please attempt to provide as dollar-specific responses as possible and feel free to add any relevant explaxation. 1. Anticipated effect on State expenditures and revenues. (a) Current cost to the agency for tl-~is programiactivity. 

### $15.000 Der year (approximatelv) (b) If this rulemaking will result in an increase or decrease in cost, speciy the fiscal year in which this change will first occur and the dollar amount ofthe effect. .No change m expense to the Illinois EPA 1s expected, as the NO, SIP Call Trading Program has been replaced by tile CAIR NOxOzone Season Tradm~ Promam. (c) Indicatc the funding source, mcludmg Fund and appropriation imes. for this prograndactivity Clean Air 

### Act Permit Program 

### Fund (CAAF'P) (d) If an increase or decrease in the costs of anotl~er State agency is anticipated, specify the fiscal year in which this change will iirst occur and the estimated dollar amount oftheeffect. No increase or decrease in costs to another State agency is anticipated, as the Illinois EPA is the only State agency that administers the NO, SIP Call Trading and CARNO, Ozone Season Trading Programs. (e) Will this nilemal&g have any effect on State revenues or expenditures not already indicated above? 

### &

2. Econom~c effect on persons affected by thc rulemaking: (a) Indicate the economic effect and spec& thepersons affected: Positive

# x Negative



### ___ No effect 

### - Persons affected: Owners and onerators of electric generatmg Lrnlts sublect to the requirements of 35 Ili. Adm. Code 217.SubparlW. Dollar amountper person: 

### - Total statewide cost:(b) 

### If an economic effect is predicted, please briefly describe how the effect will occur. Adoption 

### ofthis rulemaldnr!will eliminate duplicate requirements. 

### (c) Will the rulemaking havc an 

### indirect effect that may result in 

### increased administrative costs? Will there be any change in requirements such as filing, documentation, reporting or completion 

### of forms? Therulemalting should have no indirect effect that may result in increased administrative 

# *

### BEFORE THE ILLINOIS POLLUTION CONTROL BOARD

IN THE MATTER OF: ) 

## 1 NO, TRADING PROGUMSUNSET 

## 1 R09- PROVISIONS FOR ELECTRIC 

## 1 (Rulemaking

## - Air) GENERATINGUNITS: ) 

### AMENDMENTS TO 35 ILL. 

## 1 ADM. 

### CODE PART 217.SUBPARTW ) 

### STATEMENT OF REASONS

The Illinois Environmental Protection Agency ("Illinois EPA" or "Agency") hereby submits this Statement ofReasons to the IllilloisPollution Col~trol Board ("Board") pursuant to Sections l0,27 and 28 ofthe Environmental Protection Act ("Act") (415 ILCS 5/10,27 and 28) and 35 Ill. Adm. Code 102.202(b))in support ofthe attached proposed amendments. Included in thisproposal are anendinents to 35 111. Adin. Code Part 217, Subpart 

### W. This proposal amends the most recent version ofPar! 217.Subpart 

### W as found on the Board's website

I. 

### ILLINOIS ENVIRONMENTAL PROTECTION AGENCY'S PROPOSAI,

a. 

### Background -The NO, Trading Prograrn Subpart 

### W of Part 217 was adopted by the Board on December 21,2000. This Subpart received approval by the United States Environmental Protection Agency ("USEPA") as part of the Illinois State Implementation Plan ("SIP") for ozone onNovember 8,2001. 66

### Fed Reg. 

### 56449. Subpat

### W regulates nitrogen oxides 

### ("NO,") emissions from utility boilers, or electric generation units 

### ("EGUs"). Illinois was required to regulate these sources pursuant to USEPA's 

### NO, SIP Call. 63 Fed. 

### Reg. 

### 57356 (October 27,1998). Subpart 

### W implemented the NO, Trading Program for EGUs in Illinois to reduce ozone transport and meet Illinois' obligations

### pursuant to Sections 110(a) (2) and 126ofthe Clean '4ir Act ("CAP) and 40 CFR 51.121 for EGUs. The emissions reductions helped the two ozonenonattainment areas in Illinois attain the (1997) 8-hour ozoneNational Ambient Air Quality Standard ("NAAQS"). 

### In addition, the continued inlplementation of the federal NO, Trading Program was required under Phase I of the &hour ozone implementation rule. (40 CFR 51.905(f)). b. The New NO, Ozone Season Trading Prograin On May 12,2005,the Clean Air Interstate Rule ("CAIR") was adopted with the purpose ofreplacing theNO, SIP Call Trading Program beginning with the 2009 control period and adding two new trading programs addressing annual emissions ofNO, and sulfur dioxide. 

### Rule to Reduce Interstale Transport of Fine Particulate Matter and Ozone; Revisions toAcid Rain Pvogvam; Revisions to theNO, SIP Call, 70

### Fed. Reg. 25162 (May 12,2005). Provisions implementing CAIR in Illinois were adopted by the Board in 35 111. Adm. Code 225 (R06-22) and approved byUSEPA on October 16,2007. 72 

### Fed. Reg. 58528. The CAIR provisions as set forth in Part 225.Subpart 

### E include a trading program for control ofNO, en~issions during the

ozone season that replaces the provisions in Part 217.Subpart 

### W for 

### EGUs beginning with the 2009 control period (May 1 through September 30) and thereafter. Part 225.Subpart E incorporated in large part applicableprovisions from the federal CAIR rule as required for federal approval. While the State regulatory process was pending, the federal CAIR rule was reviewed pursuant to a number of petitions for review. On July 11, 2008, the United States Court of Appeals vacated the CAIR nrle in its entirety and remanded the n~le back to USEPA for revision. 

### Novth Carolina v. 

### USEPA,531 F.3d 896 (C.A.D.C. Cir. 2008). The court in its July 2008 opinion stated that pending the ren~and ofthe CAIR program to USEPA, the provisions of the

### NO, SIP Call Trading Prograln would remain in place. However, the sameparties that had petitioned for review, along with USEPA, then petitioned for rehearing onthe court's decision to vacate and requested that the rule be reinstated during the remand. OnDecember 23, 2008, the court granted the rehearing and unvacated CAIR with implementation to begin with the original control period in 2009. 

### North Carolina v. 

### USEPA,550 F.3d 1176 (C.A.D.C. Cir. 2008).



### c. This Proposal With the reinstatement of the CAIR program, Illinois' EGUs must now comply with duplicative administrative requirements (e.g.,permitting, reporting) for the 2009 ozone season and beyoud ~mtil the provisions ofthe NO, Trading Program are sunsetted; namely, the duplicative requirements that appear in Part217.Subpa1-t

### W. To address and remove this duplication, this proposal for sunsetting the provisions of the NO, Trading Program is consistent with the provisions of 40 

### CFR 51.123(bb)(l)(i), which provide that states with approved CAIR programs nlay revise their applicable SIP so that the provisions ofthe NO, SIP Call Trading Program do not apply to affected EGUs. 

### 11. GEOGRAPHIC REGIONS AND SOURCES AFFECTED The entire State of Illinois was subject to the NO, SIP Call and is now subject to CAR. Theproposed regulations will affect exlstlng EGUs. There are approximately229 existlng EGUs that are currently subject to the 

### NO, SIP Call Trading Program. For the NO, SIP Call Trading Program, existing units are those that comn~e~lced operation before May 1,2006. Of these units, 170 are gas and oil fired boilers, 59 are coal-fired boilers, and the remainder are gas and oil-fired conibustion turbines.

111. 

### PURPOSE AND EFFECT OF 

### THE PROPOSAL

### The purpose of this proposal is to sunset the provisio~ls of Part 217.Subpart 

### W beginning with the 2009 control period, consistent with the CAIR rule adopted by the Board in Part 225. The CARrule replaces theNO, 

### SIP Call Trading Program wit11 a program that contains both a NO, en~issions annual and an ozone season trading program. The Illinois EPA is proposing to sunset any requirements related to theNO, SIP Call Trading Program after the 2008 control period as set forth in S~~bpart 

### W beginning with the 2009 control period and thereafter. The provisions will remain in effect for violations that occurred in control periods prior to 2009. In this case, the rule is being proposed to prevent a 

### burden and replaces a rule that is no longer being iinplemented by USEPA. The adoption ofthe proposal will not result in injury or substantial prejudice, nor an abrupt departure from a well established practice. Hence, adoption ofthisproposal is appropriate to prevent a burden on affected EGUs. 

### IV. TECHNICAL FEASIBILITY AND ECONOMIC REASONABLENESS The amendments to Part 217.Subpart 

### W are being proposed to ensure consistency with the CARozone season program and prevent EGUs from being subject to duplicative monitoring, reporting, permitting and recordkeeping requirements. USEPA has stopped allocating NO, allowances for the NO, 

### SIP Call Trading Program. As this proposal sunsets regulatory provisioils, it would impose no new requirements or costs on affected sources. Hence, the proposal is both technically and economically feasible.



### V. COMMUNICATION 

### WITH INTERESTED PARTIES These amendments arcbeing proposed after representatives of industry and environmental groups have had an opportunityto review the proposed changes and provide comnlents to the IlIinoisEPA. The Illinois EPA sent electronic mails to the affected EGUs on March 19, 2009, and received one comment on an issue that will not be directly affectedby the

### proposal,i.e., the disposition ofremainder 

### NO, SIP Call Trading Program allowances. Therefore, it is the Illinois EPA's understailding that tliere are no significant issues identified by interested parties.

VI. 

### THE ILLINOIS EPA'S PROPOSAL 35 

### 111. Adm. Code 217: 

### SUBPART VV: 

### NO, TRADING PROGRAM FOR ELECTRICAL GENERATINGUNITS Section 

### 217.751 

### Sunset Provisions Illinois EPA is proposing to sunset the provisions of Subpart

### W beginning with the 2009 

### controlperiod 

### and any requirementsrelated to the 

### NO, SIP Call Trading Program afterthe 2008 

### controlperiod. The provisions will remain in effect for violationsthat occurredin controi periodsprior to 

### 2009.

### VTI. CONCLUSION For the reasons stated above, tile IlliiloisEPA hereby submits this regulatory proposal and respectfully requests that the Board expeditiously adopts these rules for the State of Illinois.

Respectfully submitted, ILLINOIS ENVIROMEKTAL PROTECTION AGENCY By: Rachel 

### L.Doctors Assistant Counsel Division of Legal Counsel DATED: 1021 North Grand Ave. East 

### P.O. Box 19276 Springfield, 

### IL 62794-9276

### Synopsis of Testimony Yoginder Mahajan, Enviromnental Protection Engineer, Air QualityPlanning Section, Bureau of Air, Illinois EPA. Mr. Mahajan will address the following: 

### * The NOx 

### SIP Call NOx Trading Program for Electrical Generating Units in 35 

### Ill. Adm. 

### Code Subpart 

### W has been replaced by CAROzone Season NOx Trading, Subpart E of 

### 35 Ill. Adm. Code 225. The proposal provides that the provisions of Subpart 

### W shall not apply for any control period in 2009 or after. However, the provisions of Subpart 

### W will remain in place for non-compliance in controlperiods prior lo 2009. The two trading programs contain duplicate NOx emissions monitoring, reporting, and record keeping provisions. Adoption of the proposal will eliminate the duplication. As this proposal does not add additional requirements, but removes duplicative provisions, no adverseteclmological and econoinic impacts are anticipated.

### BEFORE THE ILLIlVOIS POLLUTION CONTROL BOARD IN 

### THE MATTER OF: 

## 1 

## 1 NO, TRADING PROGRAM SUNSET ) 

### R09- PROVISIONS FOR ELECTRlC 

## 1 Wulemaking 

## - Air) GENERATING UNITS: 

## 1 AMENDMENTS TO 35 

### ILL. ) 

### ADM. CODE PART 217.SUBPART W )



### MOTION FOR EXPEDITED REVIEW NOW COMES Proponent, the Illinois Environniental Protection Agency ("Illinois EPA"), by one ofits attorneys, and pursuant to 35 Ill. Adm. Code 101.512,respectfully subrnits this Motion for Expedited Review ("Motion"). In support of its Motion, 

### the Illinois EPA states



### as follows: 1. 

### Subpart 

### W ofPart 217 was adoptedby theBoard onDecember 21,2000. On November 

### 8, 2001, this Subpart received approval by the United States Environmental Protection Agency ("USEPA"). 66

### Fed. Reg. 56454. Subpart 

### Wregulates nitrogen oxides ("NO,") emissions from utility boilers, or electric generation units ("EGUs"). The State of Illinois was required to regulate these sourcespursuait to USEPA's NO, SIP Call. 63

### Fed. Reg. 57356 (October 27, 1998). 2. On May 12,2005,USEPA pronlulgated the Clean Air Interstate Rule 

### ("'CAIR") with the purpose ofreplacing the NO, SIP Call Trading Progra~n beginning with the 2009 control penod 

### Rule toReduce Inter.stute Transport ofFzne Partzculute Matter and Ozone, Revisions toAcid Rain Pvogmin; Revisions to the NO, SIP Call, 70 

### Fed Reg. 25162 (May 12, 2005). Provisions inlpleinenting CAIR in Illinois were adopted by the Board in 35 111. Adm. Code 225 (R06-22) and approved by IJSEPA on October 16,2007.72

### Fed. Reg. 58528. The 

### CARprovisions as set forih 

### m Part 225.Subpart 

### E ~nclude a trad~ng program for control ofNO,

### emissions during the ozone season that replaces theprovisions in Part 217.Subpart W for EGGS beginning with the 2009 control period (May 1through September 30) and thereafter. 3. This proposal for sunsetting Subpart 

### W was not put forward with the CAIR rulemaking because while the State regulatory process was pending, the federal CAIR rule was the subject of court review. On July 11,2008;the 'United States Cowt of Appeals vacated the CAIR rule in its entirety and remanded the rule back to USEPA for revision and left the provisions oftheNO, SIP Call Trading Program in place. 

### North Carolina v. 

### USEPA,53 1F.3d 896 (C.A.D.C. Cir. 2008). 

### 4. The same parties in

### North Carolina,then, petitioned forrehearing on the court's decision to vacate and requested that the CAIR rule be reinstated during the remand. On Decembe~ 23,2008, the court unvacated 

### CAIR with implementation to begin with the original control period in 2009. 

### North Cavolina v. 

### USEPA,550 F.3d 1176 (C.A.D.C.Cir. 2008). 5. With the reinstatement of the CAD2program, Illinois' EGUs must now comply with duplicative administrative requirements (e.g., permitting, reporting) for the 2009 ozone

season and beyond until the provisions ofthe NO, Trading Program are sunsetted; namely, the duplicative requirements that appear in Parl217.Subpart 

### W.

, 

### 6. For the reasons stated above, and 

### due to the impending 2009 ozone season control period (May 1,2009,through September 30,2009), the regulations need to be adopted in an expedited manner. 7. In light ofthe foregoing, it is necessary to expedite review in 

### this matter. 

### 8. Therefore, the Illinois EPA requests that the Board proceed to First Notice under the Illinois Administrative Procedure Act, 5 

### ILCS 10011-1et 

### seq., without reaching a decision on

### its merits, by accepting the regulatory language proposed by the Illinois 

### EPA in this rnlernak'ing proposal for purposes of First Notice. 9. The Illinois EPA also request that the requisite public hearingsbe scheduled as

soon as possible in accordance with Section 28(a) ofthe Illinois Environmental Protection Act, 415 ILCS 5/28(a). 10. The Illinois EPA believes that the Board possesses the information necessary to proceed to First Notice in this rulemaking and to schedule a public hearing is coutained in the Statement of Reasons. If more information isneeded, the Illinois EPA will fully cooperate to expeditiously provide the same to the Board and its hearing officer. 11. As required by 

### 35 Ill. Adm. Code Section 101.512,this Motion is accompanied by an Affirmation attesting that the facts cited herein are true.

WHEREFORE, for thereasons set forlh above, the Illinois EPA respectfully requests that the Board grant its Motion and expedite review in this matter Respectfully submitted, ILLINOIS ENVIRONMENTAL PROTECTION AGENCY By: Is/ Rachel 

### L.Doctors Assistant Counsel Air Regulatory Unit Division of Legal Counsel

DATED: 1021North Grand Avenue, East

### P.O. 

### Box 19276 Springfield, Illinois 62794-9276 217.782.5544 217.782.9143 

### (TDD) 217.782.9807 x)

### BEFORE THE ILLINOIS POLLUTION CONTROL BOARD

STATE OF ILLINOIS 

## 1 1 SS COUNTY OF SANGAMON 

## 1 i 

### CERTIFICATE OF SERVICE I, the undersigned, 

### an attorney, statethat I have served eleetro~~lcally the attached REGULATORY PROPOSAL FOR NO, TRADING PROGRAM SUNSET PROVISIONSFOR 

### ELECTRIC

### GENERATION UNITS ("EGUS") 

### AMEDMETNS 

### TO 35 

### ILL ADM CODE PART 

### 217 

### SUBPART 

### W. APPERANCE.MOTION TOEXPEDITE AND AFFRMATION of the Illlnois Environmental Protection Agency upon the following persons John Therriault, Assistant Clerk Matthew Dunn, Chief Illinois Pollution Control Board Attorney General's Office State of Illinois Center James R. Thompson Center 100West Randolph, Suite 11-500 100 West Randolph, 12thFloor Chicago, Illinois 60601 Chicago, Illiilois 60601 Virginia Yang Deputy Legal Couilsel Illinois Dept. of Natural Resources 524 South Second Street Springfield, Illinois 62701-1787 SEE ATTACHED SERVICE LIST ILLINOIS ENVRONMENTAL PROTECTION AGENCY

Rachel 

### L. Doctors Assistant Couilsel Air RegulatoryUnit Division of Legal Counsel Dated: April 21, 2009 1021

### North Grand Avenue East Springfield, Illinois 62794-9276 (217) 782-5544 217.782.9143 (TDD)

## RULES 

# OF GO'dERNMEi\?TAl AGENCIES



## Volume 

# 33,Issue 46 

## November 

# 13,2009 Pages 1

# 5300- 1

# 5925ILLINOIS REGISTER 15754 09 POLLUTION CONTROL BOARD NOTICE OF ADOPTED AMENDMENT 1) Heading oftile Part: Nitrogen Oxides Emissions 2) Code Citation: 35 Ill. Adm. Code 217 3) Section Number: 217.751 Adopted Action: New 4) Statutory Authority: 415 ILCS 5127 and 28 5) Effective Date of Amendment: November 2,2009 6) Does this rulemaking contain an automatic repeal date? No 7) Does this rulemaking contain incomorations by reference? No 8) A copy of the adopted amendment, including any material incorporated by reference, is on file in the Board's Chicago office atthe James R. Thompson Center, 100W. Randolph, Suite 11-500 and is available for public inspection. 9) Notice of Proposal Published in Illinois Register: 33Ill. Reg. 8880; June 26, 2009. 10) Has JCAR issued a Statementof Objection to this amendment'? No 11) Differences between proposal and final version: 'The text ofthe added 35 111.Adm. Code 217.751 contains no substantive changes from the first notice proposal.However,the table of contents ofPart 217 has been revised to include SubpastsD through M, due to the recent completiotl of other air rulemakings. See, Section 27 Proposed Rules forNitrogel1Oxide (KO,) Emissions From Stationary Reciprocatingliltemal ColnbustiouEngines aud Turbines: Amendn~e~its lo 35 111. Adm. Code Parts 21 1 and 217. R07-19 (July 23, 2009) and Nitrogen OxidesEmissionsFrom Various Source Categories,Ainendmentsto 35 Ill. Adm. Code Pasts 21 1 and 217, R08-19 (Aug. 20,2009). 12) Have all the changes aweed up011by the agency and JCAR been made as indicated in the agreements letter issued by JCAR? No agreements were necessary. 13) Will this rulemalting replace any emergency rulemalting currently in effect? No 14) Are there any amendmentsuending on this Part'? NoILLINOIS REGISTER 15755 09 POLLUTION CONTROL BOARD NOTICE OF ADOPTED AMENDMENT 15) Summary and Purpose of Amendment: The Board's May 7,2009 first notice opinion and order in In the Matter of Nitrogen Oxide (NO,) Trading Program Sunset Provisions for Electric Generating Units (EGU's):New 35 Ill. Adm. Code 217.751, RO9-20 discusses in detail the amendments to Part 217.Subpart W proposed in this iulemaking. On May 7, 2009, the Illinois Pollution Colltrol Board authorized first notice publication, without comment on the merits, of an Illinois Environmental Protection Agency (IEPA) proposal that would sunset the provisions of the Nitrogen Oxides (NO,) Trading Program rules for electrical generating units (EGUs). IEPA filed this proposal with the Board on April 21,2009, seeking to add a single new section, 35 Ill. Adm. Code 217.751 to 35 Ill. Adm. Code 217.Subpart W. The Board has expedited this proceeding as requested by the IEPA. In its statement ofreasons, the IEPA states that Illinois adopted both the NOx rules at 35 Ill. Adm. Code 217 and the Clean Air Interstate Rule (CAR) at 35 Ill. Adm. Code 225 after adoption of similar rules by the United States Environmental Protection Agency (USEPA). USEPA has approved both sets ofrules for inclusion in the State Implementatioll Plan (SIP) for ozone attainment. As do the USEPA rules, the CAIR provisions, as set forth in 35 Ill. Code 225.Subpart E, include a trading program for col~trol of NO, enlissions during the ozone season that replaces the provisions in Part 217.Subpart W for EGUs beginning with the 2009 control period (May 1through September 30) and thereafter. To address this duplication, the proposal would "sunset" the provisions of the NO, Trading Program by adding a new Part 217.751. The Board adopted its second notice opinion and order on September 17,2009, adopting tile first notice proposal without substantive change. Tile Joint Committee on Adnlinistrative Rules voted a Certificate ofNo Objection at its October 14,2009 meeting. Tbe Board adopted its final opinion and order on October 15,2009. For the above reasons, the Board adopted as a final rule R09-20 16) Information and questions regarding this adopted amendment shall be directed to: Kathleen Crowley Illillois Pollution Control Board 100\V. Randolph St.,Suite 11-500 Chicago, IL 60601ILLINOIS REGISTER 15761 09 POLLUTION CONTROL BOARD NOTICE OF ADOPTED AMENDMENT

Section 217.800 217.805 217.810 217.815 217.820 217.825 217.830 217.835 217.840 217.845 217.850 217 855 217.860 217.865 Severability Applicability Compliance Requirements Permitting Requirements NO, Trading Budget Methodology for Calculating NO, Allocatiol~s for Budget Electrical Generating Units (EGUs) NO, Allocations for Budget EGUs New Source Set-Asides for "New" Budget EGUs Early Reduction Credits for Budget EGUs Opt-In Units Opt-In Process Budget Opt-LnUnits: Withdrawal from NO, Trading Program Opt-In Units: Change in Regulatory Status Allowance Allocations to Budget Opt-In Units SUBPART X. VOLUNTARY NO, EMISSIONS REDUCTION PROGRAM Purpose Emission Unit Eligibility Participation Requirements NO, Emission Reductions and the SubpartXNO, Trading Budget Baseline Emissions Determination Calculation of CreditableNO, Emission Reductions Limitations on NO, Emission Reductions NO, Emission Reduction Proposal Agency Action Emissions Determination Methods Emissions Monitoring Reporting Recordkeeping Enforcement 217.APPENDIX A Rule into Section Table 217.APPENDIXB Section into i<nleTable 21 7.APPENDIX C Compliance Dates 217.APPENDIX D Non-Electrical Generating Units 217.APPENDIX E Large Non-Electrical Generating UnitsSection 217.450 217.452 217.454 217.456 217.458 217.460 217.462 217.464 217.466 217.468 217.470 217.472 217.474 217.476 217.478 217.480 217.482

Section 217.521 217.700 217.702 217.704 217.706 217.708 217.710 217.712

Section 217.750 917 -;1 

# 1 ILLINOIS REGISTER 15760 09 POLLUTION CONTROL BOARD NOTICE OF ADOPTED AMENDMENT SUBPART

### U:NO, CONTROL Ah'D TRADING PROGRAM FOR SPECIFIED NO, GENERATING UNITS Purpose Severability Applicability Compliance Requirements Perrnittii~g Requirements Subpart U NO, Trading Budget Methodology for ObtainingNO, Allocatio~ls Methodology for Determining NO, Allowances from the New Source Set-Aside NO, Allocations Procedure for SubpartU Budget Units New Source Set-Asides for "New" Budget Units Early Reduction Credits (ERCs) .forBudget Units Low-Emitter Requirements Opt-In Units Opt-In Process Opt-In Budget Units: Withdrawal from NO, Trading Program Opt-In Units: Change in Regulatory Status Allowance Allocations to Opt-In Budget Units SUBPARTV: ELECTRIC POWER GENERATION

Lake of Egypt Power Plant Purpose Sevel-ability Applicability Emission Limitations NO, Averaging Monitoring Reporting and Recordkeeping SUBPARTW: NO, TRADING PROGRAM FOR ELECTRICAL GENERATSNGUNITSSection 217.301

Section 217.340 217.342 217.344 217.345

Section 217.381

Section 217.386 217.388 217.390 217.392 217.394 217.396

Section 217.400 217.402 217.404 217.406 217.408 217.410 ILLINOIS REGISTER 15759 09 POLLUTION CONTROL ROAKD NOTICE OF ADOPTED AMENDMENT SUBPART K: PROCESS EMISSION SOURCES

I~idustrial Processes SUBPART

### M: ELECTRICAL GENERATING UNITS Applicability Exemptions Emissions Limitations Combination ofFuels SUBPART 0: CHEMICAL MANUFACTURE Nitric Acid Manufacturing Processes SUBPART Q: STATIONARY RECIPROCATNG INTERNAL COMBUSTION ENGINES AND TURBINES Applicability Control and Maintenance Requirements Elnissions Averaging Plans Coinpliance Testing and Monitoring Recordlteeping and Reporting SUBPART T: CEMENT KILNS Applicability Control Requireme~its Testing Monitoring Reporting RecordkeepingILLTNOIS REGISTER 15758 09 POLLUTION CONTROI, BOARD NOTICE OF ADOPTED AMENDMENT SUBPART

### E: INDUSTRIAL BOILERS Section 217.160 Applicability 217.162 Exe~nptio~ls 217.164 Emissioiis Limitations 217.165 Combination of Fuels 217.166 Methods and Procedures for Combustion Tuning SUBPART

### F: PROCESS HEATERS Section 217.180 Applicability 217.182 Exemptions 217.184 Emissions Limitations 217.185 Combination of Fucls 217.186 Methods and Procedures for Combustion Tuning SUBPART 

### G: GLASS MELTING FUIWANCES Section 217.200 Applicability 217.202 Exemptions 217.204 Emissions Limitations SIJBPART H: CEMENTAND LIME KILNS Section 217.220 Applicability 217.222 Exemptions 217.224 Emissions Limitations SUBPART I: IRON AND STEEL AND ALUMINUM MANUFACTUI<ING Section 217.240 Applicability 217.242 Exemptions 217.244 Etnissions Li~nitatioilsSection 217.100 217.101 217.102 217.103 217.104

Section 217.121

Section 217.141 ILLINOIS REGISI'ER 15757 09 POLLUTION CONTROLBOARD NOTICE OF ADOPTED AMENDMENT TITLE 35: ENVIRONMENTALPROTECTION SUBTITLE B: AIR POLLUTION CHAPTER 

### I: POLLUTION CONTROL BOARD SUBCHAPTERc: EMISSION STANDARDSAND LIMITATIONS FOR STATIONARY SOURCES PART217 NITROGEN OXIDES EMISSIONS SUBPART A: GENERAL PROVISIONS Scope and Orga~lization Measurement Methods Abbreviations and Units Defmitions Incorporatiollsby Reference SUBPART B: NEW FUEL COMBUSTION EMISSION SOURCES

New Emission Sources (Repealed) SUBPART C: EXISTING FUEL COMBUSTION EMISSION UNITS

Existing Emission Units in Major MetropolitanAreas SUBPART

### D: NO, GENEMLREQUIREMENTS Applicability Complia~~ce Date Performance Testing Initial Colnpliance Certification Recordkeepingand Reporting Testing and Monitoring Einissiolis Averaging PlansILLNOIS REGISTER 15756 09 POLLUTION CONTROL BOARD NOTICE OF ADOPTED AMENDMENT Copies of the Board's opinions and orders may be requested from the Clerk of the Board at the address listed in 

### #8 above or by calling 3121814-3620. Please refer to the docket number R09-20 in your request. The Board's opinions and orders are also available from the Board's Web site (www.ipcb.stale.il.us). The full text of the Adopted Amendment begins on the next pa%:ILLINOIS REGISTER 15762 09 I'OLLUTION CONTROL BOARD NOTICE OF ADOPTED AMENDMENT 217,APPENDIXF Allowances for Electrical Generating Units 2 17.APPENDIX G Existing Reciprocating Internal CombustionEngines Affected by the NO, SIP Call 217.APPENDIX 

### H Conlpliance Dates for Certain Emissions Units at Petroleum Refineries AUTHORITY: Imple~nenting Sections 9.9 and 10 and autl~orized by Sections 27 and 28.5 of the Environmental Protection Act [415ILCS 5/9.9, 10, 27 and 28.5 (2004)l. SOURCE: Adopted as Chapter 

### 2:Air Pollution, Rule 207: Nitrogen Oxides Emissions, R71-23, 4 PCB 19 1, April 13, 1972, filed and effective April 14, 1972; amended at 2 111. Reg. 17,p. 101, effective April 13, 1978;codified at 7 ill. Reg. 13609;amended in Ii01-9 at 25 Ill. Reg. 128, effective December 26,2000; amended in R01-11 at 25 Ill. Reg. 4597, effective March 15,2001; amended in R01-16 and R01-17 at 25 Ill. Reg. 5914, effective April 17, 2001; amended in R07- 18 at 3 1Ill. Reg. 14271, effective September 25, 2007; amended in R07-19 at 33 Ill. Reg. 11999, effective August 6,2009; amended in R08-19 at 33 Ill. Reg. 13345, effectiveAugust 31,2009; amended at 33 Ill. Reg. 15754, effective November 2, 2009. SUBPARTW: NO, TRADING PROGRAM FOR ELECTRICAL GENERATING UNITS



# . , 1hc pro~.~isj(>i?s ofthis Subg,art>I/ siia11 IIO~ a.~,jv for C~IIV ionIro1veriod ii~ 2009 ortl?creaP~c~', ~oncom~lia~~cc wit11 thc ~rovisions of.~~j&~.g!~an t11t occnrrcd 13riorto 2009 is s~~bicc~ to thc 

## ~r?~Li.~bL~.~~~~:$~~~..of_1.iii~Su.bparC (Source: Added at 33 Ill. Reg. 15754, effective November 2,2009)