BryanW. Shaw, Ph.D., Chairman BuddyGarcia, Commissioner CarlosRubinstein,Commissioner Mark R.Vickery, P.G., ExecutiveDirector 

### TEXAS COMMISSION ON ENVIRONMENTAL QUALITY Protecting Texas by ReducingandPreventingPollution 

### February 5, 2010
Adina R. Wiley, Environmental Engineer U.S. EPA Region 6 Air Permits Section (6PD-R) 1445 Ross Ave. Dallas, TX 75202 Dear Ms. Wiley: N 

### w w }.'> -"**-~~,**



### In a letter dated September 8, 2005, the Texas Commissionon Environmental Quality (TCEQ) made six commitments to address specific areas ofconcernidentifiedby the United States Environmental Protection Agency (EPA) regarding the Discrete Emission Reduction Credit (DERC) rules and procedures. The letter is attached. This letter is to follow up on commitments 2 and 4 ofthe six commitments: 

### 2. The TCEQ will perform a credit audit to remove from the emissions bank all DERCs generated from permanent shutdowns after September 30, 2002. Even if 

### the shutdown itself occurred before September 30, 2002, no DERCs can be generated from that event after September 30, 2002. The audit was completed in January 2006. 

### 4. The TCEQ will revise Form DEC-I, Notice of Generation and Generator Certification of Discrete Emission Credits; Form MDEC-I, Notice of Generation and Generator Certification of Mobile Discrete Emission Credits; and Form DEC-2, Notice of Intent to Use Discrete Emission Credits, to include a waiver of the federal statute of limitations defensefor generators, and users of DERCs and mobile discrete emission reduction credits (MDERCs). Please be reminded that there is currently no applicable state statute of limitations in the State of Texas. In addition, the TCEQ will maintain its current policy of preserving all records relating to DERC and MDERC generation anduse for a minimum offiveyears after the use strategy has ended. The TCEQ committed to including a waiver ofthe federal statute oflimitations defense in regards to the DEC-I, DEC-2, and MDEC-l. To date, the MDEC-I form has never been createdbut will include awaiverofthe federal statute oflimitations defense ifat any time in the future it is created.

P.O. Box13087 Austin,Texas 78711-3087 512-239-1000 Internet address: www.tceq.state.tx.us

### Ms. Adina R. Wiley Page 2

Since the TCEQ does not normally keep old versions ofour forms and the old versions were in aprogramthat is no longerused by the banking and trading programs, the TCEQ was unable to determine the exact date thatthe federal waiver was included in our DEC-l and DEC-2 forms. The change was made to the DEC-l and DEC-2 in or before February 2007. Although not asked to do so by the EPA, the TCEQ also revised the Form DEC-3, Notice ofUse ofDiscrete Emission Credits, to add the waiverofthe federal statute oflimitations at the same time that the DEC-l and DEC-2 forms were revised. During the time period between September 2006 and February 2007, there were no DERC generations submitted. Therefore, no DEC-l forms were submitted to the agency during this time frame. Duringthis same time period, 18 DEC-2 forms were submitted. Because a DEC-3 was requiredto be subsequently filed for all DEC-2 forms submittedduring the September2006 and February 2007 time period and we have confirmed that the waiver text was added to the DEC-3 form, there would be no outstanding issue with regard to whether the language was in the DEC-2 forms filed in that six-month time period. Attached is a copy ofthe February 2007 and currentDEC-I, DEC-2, and DEC-3 forms to show that the waiver was included by February 2007. Please note that the formatting issues on the February 2007 versions are the result ofa conversion ofword processing software. Please feel free to contact Ms. Danell Zawaski at (512) 239-2389, should you have any questions regarding this correspondence or the Emissions Banking and Trading programs. Sincerely,

David Brymer, Direct r Air Quality Division Texas Commission on Environmental Quality DB/DZ/lb

## Attachment 1: February 2007 Forms

## Form DEC-l (Page 1) Notice ofGeneration and Generator Certification ofDiscrete Emission Credits (Title 30 Texas Administrative Code § 

## 101.370 - § 

## 101.379)

I. Company Identifying Information A. Company Name: Mailing Address: City: State: Zip Code: Telephone: Fax: B._TCEQ Customer Number (CN): C. Site Name: Street Address: (ifno street address, give driving directions to site) Nearest City: Zip Code: County: D. TCEQ Regulated Entity Number (RN): E. TCEQ Air Account Number: (if applicable) F. Primary SIC: Air Permit Number: II. Technical ContactIdentifying Information A. Technical Contact Name: (_Mr. _Mrs. _Ms. _Dr.) Technical Contact Title: Mailing Address: City: State: 

# I Zip Code: Telephone: Fa E-mail: x: 

## m. Contact for Sale ofCertificate A. Business Contact Name: (_Mr. _Mrs. _Ms. _Dr.) Business Contact Title: Mailing Address: City: State: Zip Code: Telephone: Fax: E-mail: IV. Generation Activity Describe reduction activity:

Date ofReduction: / / TCEQ 10391 (Revised 2/07) Form DEC-l and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. I**=a~&** 

### CCCCC G3 

### CCCCC

# ~===================Il

TCEQ 10391 (Revised 2107) Form DEC-l and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. 1**=a~E** 

## ccccc as 

## ccccc

# ,.,

- - 

# - - .. 

# laJ TCEQ

v. Non-voc Emissions Rate Data 

## Form DEC-l (Page 2) Notice ofGeneration and Generator Certification ofDiscrete Emission Credits (Title 30 Texas Administrative Code § 

## 101.370 - § 

## 101.379)

Attach documentation which demonstrates the basis for each value represented in the following table. 

### (SA) * 

### (BER - SER) 

# =reduction generated Calculation ofDERCs

EPN FIN Baseline Activity Allowable Emissions Tons Tons BE Avg Strategy Activity Activity SER Year SIP EI Tons Activity ER

TCEQ 10391 (Revised 2/07) Form DEC-I and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. I**=d~&** 

### CCCCC 

### aa 

## ccccc

# ,.,

- 

# - . ... 

# .... - TCEQ

VI. VOC Emission Data Rate 

## Form DEC-l (Page 3) Notice of Generation and Generator Certification ofDiscrete Emission Credits (Title 30 Texas Administrative Code § 

## 101.370 - § 

## 101.379)

Attach documentation which demonstrates the basis for each value represented in the following table. Ifapplying for VOC DERCs, attach a table listing the specific VOC compounds reduced and the amount ofreduction for each compound. 

### (SA) * 

### (BER - SER) 

# =reduction generated Calculation ofDERCs

EPN FIN Baseline Activity Allowable Emissions ER Tons BE Tons Avg 

# D Strategy Activity Activity Tons Year SIPEI Tons Activity

TCEQ 10391 (Revised 2/07) Form DEC-I and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. I**=a~&** 

### CCCCC G3 

### CCCCC

## Form DEC-l (Page 4) Notice ofGeneration and Generator Certification ofDiscrete Emission Credits (Title 30 Texas Administrative Code 

## § 101.370 - 

## § 101.379)

VII. Generation Period

-- 12 months Generation Period Start Date / /



### -- Other Days/months Generation Period End Date / /


### VIII. Most StringentEmission Rate Describe basis for most stringent emission rate: 0 Permit 0 RACT 0 Other: Notes:



### IX. Protocol Protocol used to calculate DERC: Note: Please attach complete calculations usedin the generation of DERCs 

### X. Certification by Responsible Official I, , hereby certify that the emission reductions claimed on this notice meet the requirements of30 TAC Chapter 101, Subchapter H, Division 4 and are not based on an emission strategy prohibited in 30 TAC Chapter 101, SubchapterH, Division4 and that the information entered in this application is correctto the best ofmy knowledge and belief. I further state that to the best ofmy knowledge and beliefthe information in this certification is not in any way in violation of 30 TAC, SubchapterH, Division 4, § 101.370-10 1.379 or any applicable air quality rule or regulation oftheTexas Commission on Environmental Quality and that intentionally or knowingly making or causing to be made false material statements or representations inthis certification is a CRIMINALOFFENSE subject to criminal penalties. I hereby also waive the Federal statute oflimitations defense inregards to the generation and use ofdiscrete emission credits Signature Signature Date Title



### Mail application to: 

### Emission Banking and Trading Program TCEQMC-206 POBOX 13087 AUSTIN, TX 78711-3087

TCEQ 10391 (Revised 2/07) Form DEC-I and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. I**=d~E** 

### CCCCC G3 

### CCCCCTCEQ 10391 (Revised 2/07) Form DEC-I and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. I**=d~E** CCCCC 

## «3 CCCCCAttachment 

### A - DERC Generation Applicant 

### Pleasecheckthe appropriate box. Administrative Information - This information is provided for applicant's use. Do not submit to TCEO. Is the Form DEC-I being submitted within 90 days from the end ofthe generation period? Have you provided verification as to whether production shifted from the facility receiving credit to another facility in the same site? Emission reduction strategy emission rate Is the generation period less than or equal to 12 months? Is a list ofall applicable Permit and Permit by Rule numbers for each EPN/FIN included? Is a copy ofthe Emissions Inventory from the most recent year ofemissions inventory used for SIP determinations for each EPN/FIN included? Is a copy ofthe Emissions Inventory for the two consecutive calender years used for the baseline period for each EPNIFIN included? Is a complete description ofthe calculation protocols used to determine the amount ofcredit requested included? Is a statement containing an explanation ofhow the credit is real, surplus, and quantifiable included? Is a list all rule citations for any applicable local, state or federal requirements included? a tank may have a state and a federal requirement. Therefore, listing the TCEQ Chapter 115 rule citation that applies along with the EPA NSPS K, Ka, or Kb should all be listed. This should be done for each EPN/.FIN. State whether or not each EPNIFIN is subject to the Mass Emissions Cap and Trade program or any other cap and trade program. Ifyes, have you taken a permanent reduction in your allowances? TECHNICAL REVIEW REQUIREMENTS Is the reduction strategy description included? IfVOC reduction, is a speciated VOC and HAP list and amounts included? Is the baseline emission activity (ex. fuel usage records, production, use, throughput, hours ofoperation) included? Is the baseline emission rate (ex. emission rate from CEMS or PEMS, guaranteed by vendor, NSR calculation protocol, AP-42) included? The most stringent emission rate or standard applicable to each EPN/FIN considering all local, state and federal requirements (ex. RACT, ESAD, NSPS, NESHAPS, MACT, etc.) Is the backup documentation for the two consecutive calender years of baseline activity such as production records, or use records, operating logs, or heat input included? Are calculations for each EPN/FIN to show how each credit generation amount was determined using the equation in §101.373(b)(I) included? Is backup documentation for the baseline emission rate or factor such as CEMS, PEMS, stack test data, or vendor guarantee included? Is NSPS applicable? If yes, what partes)? Is NESHAPS applicable? Ifyes, what partes)? Is there a MACT standard for these facilities? Ifyes, what part(s)? Does RACT apply? Ifyes, what part(s)?

TCEQ 10391 (Revised 2/07) Form DEC-l and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. I**=d~&** 

### CCCCC G3 

### CCCCC

### Form DEC-2 (Page 1) Notice ofIntent To Use Discrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379)
I. Company Identifying Information A. CompanyName: Mailing Address: City: 

# I State: Zip Code: Telephone: Fax: B. TCEQ_ CustomerNumber (CN): C. Site Name: Street Address: (ifno street address, give driving directions to site) Nearest City: 

# I Zip Code: County: D. TCEQ Regulated EntityNumber (RN): E. TCEQ Air AccountNumber: (ifapplicable) F. Primary SIC: Air Permit Number: II. 

### Technical Contact Identifying Information A. Technical Contact Name: (_Mr.



### - Mrs. _Ms. _Dr.) Technical Contact Title: Mailing Address: City: State: 

# I Zip Code: Telephone: F E-mail: a x
ID. 

### Mass Emission Cap and TradeProgram (MECT)

Is the DERC use for compliance with 30 TAC Chapter 101 SubchapterH, Division 3? DYES 

## o NO Year DERC Generated: Year ofUse: Ratio ofDERC to Allowance:

-- to



### --

- Note: 

## If DERC use is to comply with MECTthen go to Section IX 

# IN. Intended UsePeriod 

# I

TCEQ 10392 - (Revised 02107) - Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically**_a~£** CCCCC G3 CCCCCIntended Use Start Date 

### I I Intended Use End Date 

### I I

TCEQ 10392 - (Revised 02107)- Form DEC-2 Tbis form is for use by facilities subject to air quality permit requirements and may be revised periodically 

### _an CCCCC Ci3 CCCCC

### Form DEC-2 (Page 2) Notice ofIntent To Use Discrete Emission Credits (Title 30 Texas Administrative Code § 101.370 - § 101.379)



# v. State and Federal Requirements Applicable State and Federal requirements that the DERCs will be used for compliance:


### VI. Most Stringent Emission Rate Describe basis for most stringent allowable emission rate: 

## o Permit'---- Notes: 

# o RACT

_ 

## o Other:**_~~_**



### Continue to Section

# vn (next page)

TCEQ 10392 - (Revised 02107)

- Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically**_d~&** CCCCC «3 CCCCC

### Form DEC-2 (Page 3) Notice ofIntent To Use Discrete Emission Credits (Title 30 Texas Administrative Code § 

### 101.370 - § 

### 101.379)

VII. Tons ofDERCS Required Calculation of DERCs Regulated Expected Expected Total Regulated Total Emission Air Expected Activity Emission Rate Emissions Regulated Activity Emission Rate Emisssions DERCs Point No. FIN Contaminant (units) (units) (tons) (units) (units) (tons) (tons) 

# I I 

# I I 

# 10 I I 

# 10 I II 

# I I 

# I I 

# 10 I II 

# II II 

## II II 

# I 

# C lOI II I 

# I I 

# I 

# 10 I 

# 10 I 

# I I 

# 10 I I I 

# IIil I I I Total:
TCEQ 10392 - (Revised 02/07) - Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically**=a~E** 

### CCCCC G3 

### CCCCCTCEQ 10392 - (Revised 02/07) - Form DEC-2 This form is for use by facilities subject to airquality permit requirements and may be revised periodically**=d~E** 

### CCCCC G3 

### CCCCC

### Form DEC-2 (Page 4) Notice ofIntent To UseDiscrete Emission Credits (Title 30 Texas Administrative Code § 

### 101.370 - § 

### 101.379)

Vill.Protocol Protocol used to calculate DERC: Note: Attach the actual calculations that were usedto determine the amounts of DERCs neededto thisform



### IX. Total DERCS Required for Use (round up to the nearest tenth of a ton) Tons ofDERCs CO: NOx: PM IO : S02: YOC: required (from Sect.

- - 

### - - - YII.) Offset Ratio (if CO: NOx: PM IO: S02: YOC: required)

- - 

### - - - Environmental Contribution (+ 10%) CO: NOx: PM IO: S02: YOC:

- - - - - Compliance Margin (+ 5%) 

### (IfDERC use requires >10 tons) CO: NOx: PM IO : S02: YOC:

- - 

### - - - Total DERCs CO: NOx: PMIO: S02: VOC:



# . x. DERC Information Name ofthe DERC Generator: DERC Generator Regulated Entity Number: Certificate number ofthe DERCs acquired or to be acquired:

Note: The certificate number is assignedbv the TeEO TCEQ 10392 - (Revised 02107) - Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically

### Form DEC-2 (Page 5) Notice ofIntent To Use Discrete Emission Reduction Credits

(Title 30 Texas Administrative Code § 

### 101.370 - § 

### 101.379) 

# IXI. Purchase Date and Price 

# I

Date on whichthe DERCswere acquired or will be acquired: / / Price or expected price of the DERCs: $ per ton (Required) 

## xn, Certification by Responsible Official I, , hereby certify, to the best ofmy knowledge and belief, that this application is correct and the use strategy claimed on this notice has met the requirements of all applicable state and federal rules and regulations. I further state that to the best ofmy knowledge and beliefthe information in this certification is not in any way in violation oDO TAC, Subchapter H, Division 4, §I01.370-101.379 or any applicable air quality rule or regulation ofthe Texas Commission on Environmental Quality and that intentionally or knowingly making or causing to be made false material statements or representations in this certification is a CRIMINAL OFFENSE subject to criminal penalties. I hereby also waive the Federal statute oflimitations defense in regards to the generation and use ofdiscrete emission credits,

Signature Signature Date Title



### Mail application to: Emission Banking and Trading Program TCEQMC-206 PO BOX 13087 AUSTIN, TX 78711-3087

TCEQ 10392

- (Revised 02tU7) - Form DEC-2 This form is for use by facilities SUbjectto air quality permit requirements and may be revised periodically 

## IIForm DEC-3 (Page 1) Notice ofUse ofDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379)

I. Company Identifying Information A. Company Name: Mailing Address: City: 

# I State: Zip Code: Telephone: Fax: B. TCEQ_Customer Number (CN): C. Site Name: Street Address: (ifno street address, give driving directions to site) Nearest City: 

# I Zip Code: County: D. TCEQ Regulated Entity Number (RN): E. TCEQ Account Number: (ifapplicable) F. Primary SIC: Air Permit Number: II. Technical Contact Identifying Information A. Technical Contact Name: (_Mr. _Mrs. _Ms. _Dr.) Technical Contact Title: Mailing Address: City: State: 

# I Zip Code: Telephone: Fa E-mail: x: III. Mass Emission Cap and Trade 

### Program (MECT) Is the DERC use for compliance with 30 TAC Chapter 101, Subchapter H, Division 3? DYes 

# o No Year DERC Generated: Year ofuse: Ratio ofDERC to Allowance: to Note: 

### If DERC use is to comply with MECTthen go to Section IX IV. Use Period Use Start Date: Use End Date: V. State and Federal Requirements Applicable State and Federal requirements that the DERCs were used for compliance:

I I TCEQ -10392 (Rev. 02/07) These forms are for use by the sources participating in the Emission Banking and Trading Program and are subject to revision. (NSRG 7318v2)**_a~e** CCCCC G3 CCCCC

### VI. Most Stringent EmissionRate Describe basis for most stringent allowable emission rate: 0 Permit 0 RACT 0 Other:

_ Notes:

TCEQ -10392 (Rev. 02/07) These forms are for use by the sources participating in the Emission Banking and Trading Program and are subject to revision. (NSRG 7318v2)**=a~e** 

### eeeee G3 

### eeeee

### Form DEC-3 (Page 2) Notice ofUse ofDiscrete Emission Credits (Title 30 Texas Administrative Code § 

### 101.370 - § 

### 101.379)

VII. Tons ofDercs Used Calculation ofDERCs Air Actual Regulated Cont Actual Actual Total Regulated Total DERCs Emission am- Activity Emission Rate Emissions Regulated Emission Rate Emissions Used Point No. FIN inant (units) (units) (tons) Activity (units) (units) (tons) (tons)

Total:

TCEQ 10393(Revised 2/07) DEC-3Form Notice of Use of Discrete Emission Credits. This form is for use by sources subject to air quality permit requirements and may be revised periodically.**=d~&** CCCCC**~3** CCCCCForm DEC-3 (Page 3) Notice ofUse ofDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370

- 

### § 101.379)

VIII. Protocol Protocol used to calculateDERC: Note: Attach the actual calculations that were usedto determine the amounts of DERCs neededto thisform
IX. Total DERCs Used (round up to the nearest tenth of a ton) Tons ofDERCs required 

## co: NOx: PMIO: SOl: VOC: (from Sect. VI.) Offset Ratio(if required) CO: NOx: PMIO: SOl: VOC: Environmental Contribution(+ 10%) CO: NO x: PMIO: SOl: VOC:
Total DERCs Used CO: NOx: PM IO : S02: VOC: X. DERC Information Name of the DERC Generator:

- DERC GeneratorRegulatedEntity Number:



### - Certificatenumber of the DERCs used:

- Note: The certificate number is assignedby the TCEQ XI. Purchase Dates and Prices Date on whichthe DERCs were acquired orregistered: / / Price of theDERCs: $ per ton (Required) XII. CERTIFICATION BYRESPONSmLE OFFICIAL I, ,hereby certify, to the best ofmy knowledge and belief, that this application is correct and the use strategy claimed on this notice has met the requirements ofall applicable state and federal rules and regulations. I further state that to the best ofmy knowledge and beliefthe information in this certification is not in any way in violation 

### 000 TAC, Subchapter H, Division 4, 

### §101.370-101.379 or any applicable air quality rule or regulation ofthe Texas Commission on Environmental Quality and that intentionally or knowingly making or causing to be made false material statements or representations in this certification is a CRIMINAL OFFENSE subject to criminal penalties. I hereby also waive the Federal statute oflimitations defense in regards to the generation and use ofdiscrete emission credits. I hereby also waive the Federal statute oflimitations defense in regards to the generation and use ofdiscrete emission credits Signature Signature Date Title

TCEQ 10393 (Revised 2/07) DEC-3 Form Notice of Use of Discrete Emission Credits. This fonn is for use by sources subject to air quality pennit requirements and may be revised periodically.**=a~E** 

### eeeee G3 

### eeeee

## Attachment 2: Current Forms

### Form DEC-1 (Page 1) Notice ofGeneration and Generator Certification OfDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370

- 

### § 101.379)
I. Company Identifying Information A. Company Name: 

### B. Mailing Address: City: I State: Zip Code: Telephone: Fax: C. TCEQ CustomerNumber (CN): D. Site Name: Primary SIC: Street Address (Ifno street address, give driving directions to site) Nearest City: I Zip Code: County: E. TCEQ Regulated Entity Number (RN): F. TCEQ Air Account Number: 

### (if applicable): 

### II. Technical Contact Identifying Information A. Technical Contact Name: (

__ Mr.

__Mrs.

__ Ms.

__ Dr.) : Technical Contact Title: Mailing Address: City: 

## I State: Zip Code: , Telephone: 

## I Fax: E-mail: 

## m. Contact for Sale ofCertificate A. Contact Name: (

__ Mr. _ Mrs.

__ Ms.

__ Dr.) : Contact Title: Mailing Address: City: I State: Zip Code: Telephone: 

## I Fax: E-mail: 

### IV. Generation Activity Describe reduction activity:

Production shift: DYes DNo Date ofReduction:

__1

__ 1_-

TCEQ 10391 (Revised 12/07) Form DEC-l and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page of

__

### Form DEC-1 (Page 2) Notice ofGeneration and Generator Certification OfDiscrete Emission Credits (Title 30 Texas Administrative Code § 101.370 - § 101.379) 

### V. Non-voc Emissions 

### Rate Data 

## I i II Attach documentation which demonstrates the basis for each value represented 111 the following table. I' II (SA) 

### * (GER


### - SER) = reduction generated I I -". 

### :··i· .i. Calculation ofDERCs 

# ! :," EPN FIN Pollutant Year 

### .·.·BaselineActivitY:' -:».

### i~U9yY~"!t"{

# ..;;cf!.;}~~

# : .• Strategy SIP EI 

# .. , ... "...


### .. Activity Creditable

. " ,'-. 

## •......**~m~~~iqp~** 

## ..... I

........ > '," •• ', DERCs 

## I v; 

### .A9tiyitY I\BER. '. 

### REIf' EB,;"**·.T~ms** rQns': Avg Activity SER Year Tons Activity 

### ER

, I I, I II I, !j I II I Ii [, i' ,: II :1 " Ii u l\ I; II

II II I' ,I II I; I: II I' ;! I' 

## i ,I 

## I I \ Ii I ,'i Ii I I. I 

## I 'i 

# J I. 

# J Ii I i: u

[,(.'E() IOJ')l (Revised 12/07) Form DEC-I and Instructions [ llis form is for use by facilities subject to ail' quality permit requirements HUU muv br revised ncriodicallv. of

# TCEQ Form DEC-1 (Page 2) Notice of Generation and Generator Certification OfDiscrete Emission Credits (Title 30 Texas Administrative Code § 101.370 - § 101.379) VI. VOC Emission Data Rate 

### i Attach documentation which demonstrates the basis for each value represented in the following table. il Ii ii lfapplying for VOC DERCs, attach a table listing the specific VOC compounds reduced and the amount ofreduction for each compound. I' Ii (SA) 

### * (BER

- SER) = reduction enerated Ii 

# , \ 

### . : 

## . ............ "
. Calculation ofDERCs



## . I 

### MIQ",ilijJe I BaselineActivity 

## , . 

### BE:. StrategyActivity SIPEI EPN FIN HAP Year 

### '.
..**Emis~i()-n~** 

# ... :+ Creditable (YIN) ..... , . Activity 

### BER 

### RER ER··.•···I· Tons Tons Avg. Activity Tons Year Tons Activity DERCs

II
\1

----**~._---** ---**-_.~----** ---- ,I II 

## I II II it I 

### ii 

## I 1: il Ii I 

### I' Ii II I: Ii I' ': 

## I I : iI Ii II 

### 'I I II

" I .' i: I 

# I , I 

## I I ii II I

" I 

## I Ii I' ! II 

## I 1j

TCEQ 1039\ (Revised 12/(7) Form DEC-I lind Instructions

This form is for lISC by Iacilitics subject to air quality permit requirements and 1II1IY be revised ncriodicallv. Pagc of

### Form DEC-l (Page 2) Notice ofGeneration and Generator Certification OfDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370

- 

### § 101.379)

VII. Generation Period



## 012 months Generation Period StartDate / / 

# o Other Days/months Generation PeriodEnd Date / /

VIII. 

### Most StringentEmission Rate Describe basis for most stringentemissionrate: 

## D Permit 

## 0 RACT 

## 0 Other: Notes:

IX. 

### Protocol Protocolusedto calculateDERC: Note: Please attach complete calculations used in the generation 

### 0/ DERCs 

## x. Certification by Responsible Official I, , hereby certify that the emission reductions claimed on this notice meet the requirements of30 TAC Chapter 101, Subchapter H, Division 4 and are not based on an emission strategy prohibited in 30 TAC Chapter 101, Subchapter H, Division 4 and that the information entered in this application is correct to the best of my knowledge and belief. I further state that to the best of my knowledge and belief the information in this certification is not in any way in violation of 30 TAC, Subchapter H, Division 4, §101.370- 101.379 or any applicable air quality rule or regulation ofthe Texas Commission on Environmental Quality and that intentionally or knowingly making or causing to be made false material statements or representations in this certification is a CRIMINAL OFFENSE subject to criminal penalties. I hereby also waive the Federal statute of limitations defense in regards to the generation and use ofdiscrete emission credits
Signature: Signature Date: Title:

TCEQ 10391 (Revised 12/07) Form DEC-l and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page

__ of

__Attachment A - DERC Generation Applicant Please check the appropriate box. Administrative Information - This information is provided for applicant's use. Do not submit to TCEQ. Is the Form DEC-l being submitted within 90 days from the end ofthe generation period? Have you provided verification as to whether production shifted from the facility receiving credit to another facility in the same site? Emission reduction strategy emission rate Is the generation period less than or equal to 12 months? Is a list ofall applicable Permit and Permit by Rule numbers for each EPNIFIN included? Is a copy ofthe Emissions Inventory from the most recent year ofemissions inventory used for SIP determinations for each EPNIFIN included? Is a copy ofthe Emissions Inventory for the two consecutive calendar years used for the baseline period for each EPN/FIN included? Is a complete description ofthe calculation protocols used to determine the amount ofcredit requested included? Is a statement containing an explanation ofhow the credit is real, surplus, and quantifiable included? Is a list all rule citations for any applicable local, state or federal requirements included? A tank may have a state and a federal requirement. Therefore, listing the TCEQ Chapter 115 rule citation that applies along with the EPA NSPS K, Ka, or Kb should all be listed. This should be done for each EPN/.FIN. State whether or not each EPN/FIN is subject to the Mass Emissions Cap and Trade program or any other cap and trade program. Ifyes, have you taken a permanent reduction in your allowances? TECHNICAL REVIEW REQUIREMENTS Is the reduction strategy description included? IfVOC reduction, is a speciated VOC and HAP list and amounts included? Is the baseline emission activity (ex. fuel usage records, production, use, throughput, hours ofoperation) included? Is the baseline emission rate (ex. emission rate from CEMS or PEMS, guaranteed by vendor, NSR calculation protocol, AP-42) included? The most stringent emission rate or standard applicable to each EPNIFIN considering all local, state and federal requirements (ex. RACT, ESAD, NSPS, NESHAPS, MACT, etc.) Is the backup documentation for the two consecutive calendar years ofbaseline activity such as production records, or use records, operating logs, or heat input included? Are calculations for each EPNIFIN to show how each credit generation amount was determined using the equation in § 101.373(b)(1) included? Is backup documentation for the baseline emission rate or factor such as CEMS, PEMS, stack test data, or vendor guarantee included? Is NSPS applicable? Ifyes, what part(s)? Is NESHAPS applicable? Ifyes, what part(s)? Is there a MACT standard for these facilities? Ifyes, what part(s)? Does RACT apply? Ifyes, what part(s)?

TCEQ 10391 (Revised 12/07) Form DEC-l and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page

__ of

__

### Form DEC-2 (Page 1) Notice ofIntent to UseDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379)
I. Company Identifying Information A. Company Name: Mailing Address: City: 

## I State: Zip Code: Telephone: Fax: B. TCEQ Customer Number (CN): C. Site Name: Street Address (Ifno street address, give driving directions to site)

Nearest City: 

## I Zip Code: County: D. TCEQ Regulated Entity Number (RN): E. TCEQ Air Account Number: 

### (if applicable) F. Primary SIC: Air Permit Number: II. 

### Technical Contact Identifying Information A. Technical Contact Name: 

## (0 Mr. 

## 0 Mrs. 

## 0 Ms. 

## 0 Dr.): Technical Contact Title: Mailing Address: City: 

# I State: 

# I Zip Code: Telephone: 

## I Fax: 

## I E-mail: ill. 

### Company Contact Identifying Information (If different from Technical Contact) A. Company Contact Name: 

## (0 Mr. 

## 0 Mrs. 

## 0 Ms. 

## 0 Dr.): Company ContactTitle: Mailing Address: City: 

## I State: 

## I Zip Code: Telephone: 

## I Fax: 

## I E-mail: 

### IV. Mass Emission Cap and Trade Program (MECT)
Is the DERC use for compliance with 30 TAC Chapter 101 Subchapter H, Division 3? DYES D NO Year DERC Generated: Year ofUse: Ratio ofDERC to Allowance:

__to

__ Note: 

### If DERC use is to comply with MECTthen go to Section IX


### V. Intended Use Period Intended Use Start Date: /



# __ / Intended Use End Date: /



# __ /

TCEQ 10391 (Revised 12/07) Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page

__ 

### «.._

# n 

# ." TCEQ Form DEC-2 (Page 2) Notice ofIntent to Use Discrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379)
VI. State and Federal Requirements Applicable State and Federal requirements that the DERCs will be used for compliance: 

### VII. Most Stringent Emission Rate Describe basis for most stringent allowable emission rate: 

# o Permit DRACT 

# o Other: 

### Notes:

VIII. 

### Protocol Protocol used to calculate DERC: Note: Attach the actual calculations that were used to determine the amounts ofDERCs needed to this form

Continue to Section IX (next page)

TCEQ 10391 (Revised 12/07) Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page

__ of

__

# TCEQ Form DEC-2 (Page 3) Notice ofIntent to Use Discrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379)

IX. Tons ofDERCS Required Calculation ofDERCs Emission FIN Air Expected Expected Total Regulated Regulated Total Point No. Contaminant Expected Activity Regulated (units) Emission Rate Emissions Activity (units) Emission Rate Emissions DERCs (tons) (units) (tons) (units) (tons)

Total:

TCEQ 10392(Revised 12(07) Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page

__ of

__Form DEC-2 (Page 

### 4) Notice ofIntent to Use Discrete Emission Credits (Title 

### 30 Texas Administrative Code 

### § 101.370 - § 101.379)


# x. Total DERCS Required for Use (round up to the nearest tenth ofa ton) Tons ofDERCs required (from Sect. 

## co: NOx: PM lO : S02: VOC: VII.) Offset Ratio (if required) CO: NOx: PM lO: S02: VOC: Environmental Contribution (+ 10%) CO: NOx: PM lO: S02: VOC: Compliance Margin (+ 5%) (If DERC 

### use requires >10 tons) CO: NOx: PM lO : S02: VOC:
TotalDERCs CO: NOx: 

### PMlO: S02: VOC: 

### XI. DERC Information Name ofthe DERC Generator: DERC Generator Regulated Entity Number: Certificate number ofthe DERCs acquired or to be acquired: Date on which the DERCs were acquired orwill be acquired: 

### Note: The certificate number is assignedby the TCEQ XII. Certification by Responsible Official I, ,hereby certify, to the best ofmy knowledge and belief, that this application is correct and the use strategy claimed on this notice has met the requirements of all applicable state and federal rules and regulations. I further state that to the best ofmy knowledge and beliefthe information in this certification is not in any way in violation of 30 TAC, Subchapter H, Division 4, §101.370-101.379 or any applicable air quality rule or regulation ofthe Texas Commission on Environmental Quality and that intentionally or knowingly making or causing to be made false material statements or representations in this certification is a CRIMINAL OFFENSE subject to criminal penalties. I hereby also waive the Federal statute oflimitations defense in regards to the generation and use ofdiscrete emission credits. Signature Signature Date Title

TCEQ 10392 (Revised 12/07) Form DEC-2 This form is for use by facilities subject to air quality permit requirements and may be revised periodically.

# n 

# • TCEQ Form DEC-3 (Page 1) Notice of Use ofDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379)
I. COMPANY IDENTIFYING INFORMATION A. 

### Company Name: Mailing Address: City: I 

### State: Zip Code: Telephone: Fax: B. 

### TCEQ CustomerNumber (CN): C. Site Name: Street Address (Ifno street address, give driving directions to site)

Nearest City: 

## I Zip Code: I 

### County: D. TCEQ Regulated Entity Number (RN): E. TCEQ Air Account Number: (ifapplicable) F. Primary SIC: 

## I Air Permit Number: 

## n, TECHNICAL CONTACT IDENTIFYING INFORMATION A. 

### Technical Contact Name: ( 

# o Mr. 

## 0 Mrs. 

## 0 Ms. 

# o Dr.): Technical Contact Title: Mailing Address: City: 

# I State: 

# I Zip Code: Telephone: 

# I Fax: 

# I E-mail: ill. 

### COMPANY CONTACT IDENTIFYING INFORMATION A. Company ContactName: ( 

# o Mr. 

# o Mrs. 

# o Ms.D Dr.): Company Contact Title: Mailing Address: City: 

## I State: 

## I Zip Code: Telephone: 

## I Fax: 

## I E-mail: IV. Mass Emission Cap and Trade Program (MECT) Is the DERC use for compliance with 30 TAC Chapter 101, Subchapter H, Division 3? DYes 

# o No
Year DERC Generated: Year ofuse: Ratio ofDERC to Allowance:

-- 

### to
Note: 

## If DERC use is to comply with MECTthen go to Section X 

# v. Use Period Use Start Date: / / 

### Use End Date: / /



### VI. State and Federal Requirements TCEQ 10393 (Revised 12/07) Form DEC-3 and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically.

# TCEQ Form DEC-3 (Page 2) Notice ofUse ofDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379) Applicable State and Federal requirements that the DERCs will be used for compliance:

VII. Most Stringent Emission Rate Describe basis for most stringent allowable emission rate: D Permit: DRACT: D Other: 

### Notes:

VIII. 

### PROTOCOL Protocol used to calculate DERC: 

### Note: Attach the actualcalculations that were used todetermine theamounts of DERCsneeded to thisform

Continue to Section VII (next page)

TCEQ 10393 (Revised 12/07) Form DEC-3 and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically.

### Form DEC-3 (Page 3) Notice ofUse ofDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370

- 

### § 101.379)

, 

### IX. Tons of DERCs Used Calculation ofDERCs

Emission Air Actual Actual Actual Total Regulated Regulated Regulated PointNo. FIN 

### Contaminant Emissions Emissions Emissions Activity Emissions Total DERCsUsed Rate (units) Rate (units) (tons) (units) Rate (units) Emissions (tons) (tons)

Total:

TCEQ 10393 (Revised 12/07) Form DEC-3 and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page_of_

### Form DEC-3 (Page 4) Notice of Use ofDiscrete Emission Credits (Title 30 Texas Administrative Code 

### § 101.370 - 

### § 101.379)


## X. TOTAL DERCS REQUIRED FOR USE (round up to the nearest tenth ofa ton)
Tons ofDERCs required CO: NOx: 

### PMIO: 

### SOl: VOC: (from Sect. VI.) Offset Ratio (ifrequired) CO: NOx: PM IO: 

### S02: VOC: Environmental Contribution (+ 

### 10%) 

### CO: NOx: PMIO: 

### S02: VOC:
Total DERCs Used CO: NOx: PM IO: 

### S02: VOC: XI. 

### DERC INFORMATION
Name ofthe DERC Generator: DERC Generator Regulated Entity Number: Certificate number ofthe DERCs acquired or to be acquired: 

### Note: The certificate number is assignedby the TCEQ XII. 

### CERTIFICATION BY RESPONSmLE OFFICIAL I, , hereby certify, to the best of my knowledge and belief, that this application is correct and the use strategy claimed on this notice has met the requirements of all applicable state and federal rules and regulations. I further state that to the best of my knowledge and belief the information in this certification is not in any way in violation of30 

### TAC, Subchapter H, Division 4, §101.370-101.379 

### or any applicable air quality rule or regulation of the Texas Commission on Environmental Quality and that intentionally or knowingly making or causing to be made false material statements or representations in this certification is a CRIMINAL OFFENSE subject to criminal penalties. I hereby also waive the Federal statute oflimitations defense in regards to the generation and use ofdiscrete emission credits.

Signature: Date: Title

TCEQ 10393 (Revised 12/07) Form DEC-3 and Instructions This form is for use by facilities subject to air quality permit requirements and may be revised periodically. Page_of_

## Attachment 3: September 8, 2005 letterto EPAKathleen HartnettWhite, 

### Chairman R. 

### B. "Ralph" Marquez, Commissioner Larry

### R. Soward, Commissioner Glenn Shankle,'

### ExecutiveDirector 

## TEXAS COMMISSION ON ENVIRONMENTAL QUALITY Protecting Texas by

### Reducingand PreventingPollution 

### September 8,2005

Richard E. Greene Regional Administrator U.S. Environmental Protection Agency.Region 6 1445 Ross Avenue..Suite 1200 Dallas, Texas 75202-2733 DearMayor Greene: I'mwriting in response to yourletterreceived July 22,2005, requesting commitments by the Texas Commission on Environmental Quality (TCEQ) to address specific areas ofconcem the U.S. Environmental Protection Agency (EPA) has identified within the Discrete Emission Reduction Credit (I>ERC)rules and procedures. Subject to Commission approvalandpublic participation, the TCEQ Executive Director commits to making the following revisions to the DERC rules and procedures: ' 1. Revise Title 30 Texas Administrative Code (30 TAC) § 

### 101.373 to prohibit the future generation ofDERCs from permanent shutdowns and to allow DERCs generated'and , ' banked from permanent shutdowns prior to September 30, 2002, to remain available for use for no more than five years from the date ofthis letter. '
. 2. The TCEQ will 

### perform a credit audit to remove from the emissions bank all DERCs generated from pemianent shutdowns after September 30, 2002. Even ifthe shutdown itselfoccurred before September 30,2002, no DERCs can be generatedfrom that event after September30,2002. 3. Revise 30 TAC §§, 

### 101.302(f), 101.372(f)(7), and 101.372(f)(8)to clarify that EPA approval is required for individual transactions involving emissionreductions generated in another state or nation, as well as those transactions from one nonattainment area to another, or from attainment counties into nonattainment areas. The TCEQ further understands that the EPA would require a state implementation plan revision prior to approving any transaction between another'state or nation, as well as, those transactions between counties not locatedwithin the same nonattainment area. 4. The TCEQ will revise Form DEC-I, Notice ofGeneration and Generator Certification of Discrete Emission Credits; Form MDEC-l, Notice of Generation and Generator

P.O. Box 13087 • Austin, Texas 78711-3087 • 512/239-1000 • Internetaddress: www.tceq.state.tx.us"

### Richard E. Greene Page 2 September 8, 2005 Certification ofMobile Discrete Emission Credits; and Form DEC-2, Notice ofIntent to Use Discrete Emission Credits, to include 

# awaiver to the federal statute of limitations defense for generators, and users ofDERCs and mobile discrete' emission reduction credits (MDERCs). Please be reminded that there is currently no applicable state statute oflimitations in the State oftexas. In 

### addition, the TCEQ Willmaintain its current policy of preserving all records relating to DERC and MDERC generation and use for aminimum offive years after the use strategy has ended. 

### '5. Revise 30 TAC 

### §§ 101.302 and 101.372 to clarify that aproposed quantificationprotocol may not be used ifthe TCEQ ExecutiveDirector receives a letter from the EPA objecting to the use of the protocol during the 45-day adequacy review period or ifthe EPA proposes disapproval ofthe protocol 

### in the 

## FederalRegister. 6. Revise 30 TAC 

### § 101.306 to specifythat EmissionReductionCredits maybeused

## within the highly reactive volatile organic compounds Emissions Cap and Trade program as an annual allocation ofallowances asprovidedunder 30 TAC 

### § 101.399. During the conditional approval period, the TCEQ

### willnot approve anytrades involvingthe types ofreductions described 

### in ItemNo.3 above; will not approve any use ofshutdowncredits that were generated after September 30, 2002; and, will require the waiver described 

### in Item No.4 above for generators and users ofdiscrete emission credits. TheTCEQ 

### will submit the revisions to the EPAby December 1, 2006. The TCEQ also recognizes that the conditional approval 

### will automatically become a disapproval 

### if the revisions are not completed and submitted to the EPA by this date. Please feel free to contact me at (512) 239-3900, or 

### Mr. Cory Chism at (512) 239-0539, should you have any questions regarding this correspondence or the Emissions Banking and Trading programs. Sincerely,

# ~P- Glenn Shankle, Executive Director Texas Commission onEnvironmental Quality GS/RC/pl cc: Ms. Adina Wiley, Region 6, U.S. EnvironmentalProtectionAgency, Dallas ,