STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS

DEPARTMENT OF ENVIRONMENTAL MANAGEMENT

OFFICE OF AIR RESOURCES

AIR POLLUTION CONTROL REGULATION NO. 41

NOx BUDGET TRADING PROGRAM

Effective 21 October 1999

Last Amended 19 July 2007

AUTHORITY: These regulations are authorized pursuant to R.I. Gen. Laws § 42-

17.1-2(s) and 23-23, as amended, and have been promulgated pursuant to the 

procedures set forth in the R.I. Administrative Procedures Act, R.I. Gen. Laws Chapter 

42-35.
RHODE ISLAND DEPARTMENT OF ENVIRONMENTAL MANAGEMENT

OFFICE OF AIR RESOURCES

AIR POLLUTION CONTROL REGULATION NO. 41

NOx BUDGET TRADING PROGRAM

TABLE OF CONTENTS

41.1. Definitions.................................................................................................................................1

41.2 NOx Emission Budget............................................................................................................10

41.3 Applicability...........................................................................................................................10

41.4 General Provisions..................................................................................................................12

41.5 NOx Allowance Allocations...................................................................................................16

41.6 NOx Authorized Account Representative for NOx Budget Sources ....................................16

41.7 Permits.....................................................................................................................................21

41.8 NOx Allowance Transfers......................................................................................................25

41.9 NOx Allowance Tracking System..........................................................................................26

41.10 Monitoring ..............................................................................................................................37

41.11 Recordkeeping and reporting..................................................................................................48

41.12 Compliance Certification........................................................................................................52

41.13 Individual Opt-ins. ..................................................................................................................54

41.14 Retired unit exemption. ..........................................................................................................63

41.15 General Provisions..................................................................................................................64
Page 1 of 66

RHODE ISLAND DEPARTMENT OF ENVIRONMENTAL MANAGEMENT

OFFICE OF AIR RESOURCES

AIR POLLUTION CONTROL REGULATION NO. 41

NOx BUDGET TRADING PROGRAM

41.1. Definitions

Unless otherwise expressly defined in this section, the terms used in this regulation shall be 

defined by reference to the Rhode Island Air Pollution Control General Definitions Regulation. 

As used in this regulation, the following terms shall, where the context permits, be construed as 

follows:

41.1.1 "Account certificate of representation" means the completed and signed 

submission required by section 41.6 for certifying the designation of a NOx 

authorized account representative for a NOx Budget source or a group of 

identified NOx Budget sources who is authorized to represent the owners and 

operators of such source or sources and of the NOx Budget units at such source 

or sources with regard to matters under the NOx Budget Trading Program.

41.1.2 "Account number" means the identification number given by the 

Administrator to each NOx Allowance Tracking System account.

41.1.3 "Acid Rain emissions limitation" means, as defined in 40 CFR 72.2, a 

limitation on emissions of sulfur dioxide or nitrogen oxides under the Acid 

Rain Program under title IV of the CAA.

41.1.4 "Allocate or allocation" means the determination by the Department or the 

Administrator of the number of NOx allowances to be initially credited to a 

NOx Budget unit or an allocation set-aside.

41.1.5 "Automated data acquisition and handling system or DAHS" means that 

component of the CEMS, or other emissions monitoring system approved for 

use under section 41.10, designed to interpret and convert individual output 

signals from pollutant concentration monitors, flow monitors, diluent gas 

monitors, and other component parts of the monitoring system to produce a 

continuous record of the measured parameters in the measurement units 

required by section 41.10 and 41.11.

41.1.6 "Boiler" means an enclosed fossil or other fuel-fired combustion device used 

to produce heat and to transfer heat to recirculating water, steam, or other 

medium.

41.1.7 "Combined cycle system" means a system comprised of one or more 

combustion turbines, heat recovery steam generators, and steam turbines 
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configured to improve overall efficiency of electricity generation or steam 

production.

41.1.8 "Combustion turbine" means an enclosed fossil or other fuel-fired device 

that is comprised of a compressor, a combustor, and a turbine, and in which the

flue gas resulting from the combustion of fuel in the combustor passes through 

the turbine, rotating the turbine.

41.1.9 "Commence commercial operation" means, with regard to a unit that serves 

a generator, to have begun to produce steam, gas, or other heated medium used 

to generate electricity for sale or use, including test generation. Except as 

provided in section 41.14, for a unit that is a NOx Budget unit under section 

41.3 on the date the unit commences commercial operation, such date shall 

remain the unit's date of commencement of commercial operation even if the 

unit is subsequently modified, reconstructed, or repowered. Except as provided 

in section 41.13 or section 41.14, for a unit that is not a NOx Budget unit under 

section 41.3 on the date the unit commences commercial operation, the date the 

unit becomes a NOx Budget unit under section 41.3 shall be the unit's date of 

commencement of commercial operation.

41.1.10 "Commence operation" means to have begun any mechanical, chemical, or 

electronic process, including, with regard to a unit, start-up of a unit's 

combustion chamber. Except as provided in section 41.14, for a unit that is a 

NOx Budget unit under section 41.3 on the date of commencement of 

operation, such date shall remain the unit's date of commencement of operation 

even if the unit is subsequently modified, reconstructed, or repowered. Except 

as provided in section 41.13 or section 41.14, for a unit that is not a NOx 

Budget unit under section 41.3 on the date of commencement of operation, the 

date the unit becomes a NOx Budget unit under section 41.3 shall be the unit's 

date of commencement of operation.

41.1.11 "Common stack" means a single flue through which emissions from two or 

more units are exhausted.

41.1.12 "Compliance certification" means a submission to the Department or the 

Administrator, as appropriate, that is required under section 41.12 to report a 

NOx Budget source's or a NOx Budget unit's compliance or noncompliance 

with this regulation and that is signed by the NOx authorized account 

representative in accordance with section 41.6.

41.1.13 "Compliance account" means a NOx Allowance Tracking System account, 

established by the Administrator for a NOx Budget unit under section 41.9, in 

which the NOx allowance allocations for the unit are initially recorded and in 

which are held NOx allowances available for use by the unit for a control 

period for the purpose of meeting the unit's NOx Budget emissions limitation.
Page 3 of 66

41.1.14 "Continuous emission monitoring system or CEMS" means the equipment 

required under section 41.10 to sample, analyze, measure, and provide, by

readings taken at least once every 15 minutes of the measured parameters, a 

permanent record of nitrogen oxides emissions, expressed in tons per hour for 

nitrogen oxides. The following systems are component parts included, 

consistent with 40 CFR Part 75, in a continuous emission monitoring system:

(a) Flow monitor;

(b) Nitrogen oxides pollutant concentration monitors;

(c) Diluent gas monitor (oxygen or carbon dioxide) when such 

monitoring is required by section 41.10;

(d) A continuous moisture monitor when such monitoring is required 

by section 41.10; and

(e) An automated data acquisition and handling system.

41.1.15 "Control period" means the period beginning May 1 of a year and ending on 

September 30 of the same year, inclusive.

41.1.16 "Emissions" means air pollutants exhausted from a unit or source into the 

atmosphere, as measured, recorded, and reported to the Administrator by the 

NOx authorized account representative and as determined by the Administrator 

in accordance with sections 41.10 and 41.11.

41.1.17 "Energy Information Administration" means the Energy Information 

Administration of the United States Department of Energy.

41.1.18 "Excess emissions" means any tonnage of nitrogen oxides emitted by a NOx 

Budget unit during a control period that exceeds the NOx Budget emissions 

limitation for the unit.

41.1.19 "Fossil fuel-fired" means, with regard to a unit:

(a) The combustion of fossil fuel, alone or in combination with any

other fuel, where fossil fuel actually combusted comprises more 

than 50 percent of the annual heat input on a Btu basis during any

year starting in 1995 or, if a unit had no heat input starting in 1995, 

during the last year of operation of the unit prior to 1995; or

(b) The combustion of fossil fuel, alone or in combination with any

other fuel, where fossil fuel is projected to comprise more than 50 

percent of the annual heat input on a Btu basis during any year; 

provided that the unit shall be "fossil fuel-fired" as of the date, 

during such year, on which the unit begins combusting fossil fuel.
Page 4 of 66

41.1.20 "General account" means a NOx Allowance Tracking System account, 

established under section 41.9 that is not a compliance account or an overdraft 

account.

41.1.21 "Generator" means a device that produces electricity.

41.1.22 "Heat input" means the product (in mmBtu/time) of the gross calorific value 

of the fuel (in Btu/lb) and the fuel feed rate into a combustion device (in mass 

of fuel/time), as measured, recorded, and reported to the Administrator by the 

NOx authorized account representative and as determined by the Administrator 

in accordance with sections 41.10 and 41.11, and does not include the heat 

derived from preheated combustion air, recirculated flue gases, or exhaust from 

other sources.

41.1.23 "Life-of-the-unit, firm power contractual arrangement" means a unit 

participation power sales agreement under which a utility or industrial 

customer reserves, or is entitled to receive, a specified amount or percentage of 

nameplate capacity and associated energy from any specified unit and pays its 

proportional amount of such unit's total costs, pursuant to a contract:

(a) For the life of the unit;

(b) For a cumulative term of no less than 30 years, including contracts 

that permit an election for early termination; or

(c) For a period equal to or greater than 25 years or 70 percent of the 

economic useful life of the unit determined as of the time the unit 

is built, with option rights to purchase or release some portion of 

the nameplate capacity and associated energy generated by the unit 

at the end of the period.

41.1.24 "Maximum design heat input" means the ability of a unit to combust a stated 

maximum amount of fuel per hour on a steady state basis, as determined by the 

physical design and physical characteristics of the unit.

41.1.25 "Maximum potential hourly heat input" means an hourly heat input used for 

reporting purposes when a unit lacks certified monitors to report heat input. If 

the unit intends to use appendix D of 40 CFR Part 75 to report heat input, this 

value should be calculated, in accordance with 40 CFR Part 75, using the 

maximum fuel flow rate and the maximum gross calorific value. If the unit 

intends to use a flow monitor and a diluent gas monitor, this value should be 

reported, in accordance with 40 CFR Part 75, using the maximum potential 

flowrate and either the maximum carbon dioxide concentration (in percent 

CO2) or the minimum oxygen concentration (in percent O2).
Page 5 of 66

41.1.26 "Maximum potential NOx emission rate" means the emission rate of 

nitrogen oxides (in lb/mmBtu) calculated in accordance with section 3 of 

appendix F of 40 CFR Part 75, using the maximum potential nitrogen oxides 

concentration as defined in section 2 of appendix A of 40 CFR Part 75, and 

either the maximum oxygen concentration (in percent O2) or the minimum 

carbon dioxide concentration (in percent CO2), under all operating conditions 

of the unit except for unit start up, shutdown, and upsets.

41.1.27 "Maximum rated hourly heat input" means a unit-specific maximum hourly

heat input (mmBtu) which is the higher of the manufacturer's maximum rated 

hourly heat input or the highest observed hourly heat input.

41.1.28 "Monitoring system" means any monitoring system that meets the 

requirements of section 41.10, including a continuous emissions monitoring 

system, an excepted monitoring system, or an alternative monitoring system.

41.1.29 "Most stringent State or Federal NOx emissions limitation" means, with 

regard to a NOx Budget opt-in source, the lowest NOx emissions limitation (in 

terms of lb/mmBtu) that is applicable to the unit under State or Federal law, 

regardless of the averaging period to which the emissions limitation applies.

41.1.30 "Nameplate capacity" means the maximum electrical generating output (in 

MWe) that a generator can sustain over a specified period of time when not 

restricted by seasonal or other deratings as measured in accordance with the 

United States Department of Energy standards.

41.1.31 "Non-title V permit" means a federally enforceable permit administered by

the Department pursuant to the CAA and regulatory authority under the CAA, 

other than title V of the CAA and Air Pollution Control Regulation No. 29.

41.1.32 "NOx allowance" means an authorization by the Department or the 

Administrator under the NOx Budget Trading Program to emit up to one ton of 

nitrogen oxides during the control period of the specified year or of any year 

thereafter.

41.1.33 "NOx allowance deduction or deduct NOx allowances" means the 

permanent withdrawal of NOx allowances by the Administrator from a NOx 

Allowance Tracking System compliance account or overdraft account to 

account for the number of tons of NOx emissions from a NOx Budget unit for a

control period, determined in accordance with sections 41.10 and 41.11, or for 

any other allowance surrender obligation under this regulation.

41.1.34 "NOx allowances held or hold NOx allowances" means the NOx allowances 

recorded by the Administrator, or submitted to the Administrator for 
Page 6 of 66

recordation, in accordance with sections 41.8 and 41.9, in a NOx Allowance 

Tracking System account.

41.1.35 "NOx Allowance Tracking System" means the system by which the 

Administrator records allocations, deductions, and transfers of NOx allowances 

under the NOx Budget Trading Program.

41.1.36 "NOx Allowance Tracking System account" means an account in the NOx 

Allowance Tracking System established by the Administrator for purposes of 

recording the allocation, holding, transferring, or deducting of NOx 

allowances.

41.1.37 "NOx allowance transfer deadline" means midnight of November 30 or, if 

November 30 is not a business day, midnight of the first business day thereafter 

and is the deadline by which NOx allowances may be submitted for recordation 

in a NOx Budget unit's compliance account, or the overdraft account of the 

source where the unit is located, in order to meet the unit's NOx Budget 

emissions limitation for the control period immediately preceding such 

deadline.

41.1.38 "NOx authorized account representative" means, for a NOx Budget source 

or NOx Budget unit at the source, the natural person who is authorized by the 

owners and operators of the source and all NOx Budget units at the source, in 

accordance with section 41.6, to represent and legally bind each owner and 

operator in matters pertaining to the NOx Budget Trading Program or, for a 

general account, the natural person who is authorized, in accordance with 

section 41.9, to transfer or otherwise dispose of NOx allowances held in the 

general account.

41.1.39 "NOx Budget emissions limitation" means, for a NOx Budget unit, the 

tonnage equivalent of the NOx allowances available for compliance deduction 

for the unit and for a control period under paragraphs 41.9.5(a) and (b), 

adjusted by any deductions of such NOx allowances to account for excess 

emissions for a prior control period under paragraph 41.9.5(d) or to account for 

withdrawal from the NOx Budget Program, or for a change in regulatory status, 

for a NOx Budget opt-in source under subsections 41.13.7 or 41.13.8.

41.1.40 "NOx Budget opt-in permit" means a NOx Budget permit covering a NOx 

Budget opt-in source.

41.1.41 "NOx Budget opt-in source" means a unit that has been elected to become a 

NOx Budget unit under the NOx Budget Trading Program and whose NOx 

Budget opt-in permit has been issued and is in effect under section 41.13.
Page 7 of 66

41.1.42 "NOx Budget permit" means the legally binding and federally enforceable 

written document, or portion of such document, issued by the Department 

under this regulation, including any permit revisions, specifying the NOx 

Budget Trading Program requirements applicable to a NOx Budget source, to 

each NOx Budget unit at the NOx Budget source, and to the owners and 

operators and the NOx authorized account representative of the NOx Budget 

source and each NOx Budget unit.

41.1.43 "NOx Budget source" means a source that includes one or more NOx Budget 

units. 

41.1.44 "NOx Budget Trading Program" means a multi-state nitrogen oxides air 

pollution control and emission reduction program established pursuant to 40 

CFR 51.121, as a means of mitigating the interstate transport of ozone and 

nitrogen oxides, an ozone precursor.

41.1.45 "NOx Budget" unit means a unit that is subject to the NOx Budget Trading 

Program emissions limitation under sections 41.3 or 41.13.

41.1.46 "Operating" means, with regard to a unit under paragraph 41.7.4(d)(2) and 

subsection 41.13.1, having documented heat input for more than 876 hours in 

the 6 months immediately preceding the submission of an application for an 

initial NOx Budget permit under subsection 41.13.4.

41.1.47 "Operator" means any person who operates, controls, or supervises a NOx 

Budget unit, a NOx Budget source, or unit for which an application for a NOx 

Budget opt-in permit under subsection 41.13.4 is submitted and not denied or 

withdrawn and shall include, but not be limited to, any holding company, utility

system, or plant manager of such a unit or source. 

41.1.48 "Opt-in" means to be elected to become a NOx Budget unit under the NOx 

Budget Trading Program through a final, effective NOx Budget opt-in permit 

under section 41.13.

41.1.49 "Overdraft account" means the NOx Allowance Tracking System account, 

established by the Administrator under section 41.9, for each NOx Budget 

source where there are two or more NOx Budget units.

41.1.50 "Owner" means any of the following persons:

(a) Any holder of any portion of the legal or equitable title in a NOx 

Budget unit or in a unit for which an application for a NOx Budget 

opt-in permit under subsection 41.13.4 is submitted and not denied 

or withdrawn; or
Page 8 of 66

(b) Any holder of a leasehold interest in a NOx Budget unit or in a unit 

for which an application for a NOx Budget opt-in permit under 

subsection 41.13.4 is submitted and not denied or withdrawn; or

(c) Any purchaser of power from a NOx Budget unit or from a unit for 

which an application for a NOx Budget opt-in permit under 

subsection 41.13.4 is submitted and not denied or withdrawn under 

a life-of-the-unit, firm power contractual arrangement. However, 

unless expressly provided for in a leasehold agreement, owner shall 

not include a passive lessor, or a person who has an equitable 

interest through such lessor, whose rental payments are not based, 

either directly or indirectly, upon the revenues or income from the 

NOx Budget unit or the unit for which an application for a NOx 

Budget opt-in permit under subsection 41.13.4 is submitted and not 

denied or withdrawn; or

(d) With respect to any general account, any person who has an 

ownership interest with respect to the NOx allowances held in the 

general account and who is subject to the binding agreement for the

NOx authorized account representative to represent that person's 

ownership interest with respect to NOx allowances.

41.1.51 "Receive or receipt of" means, when referring to the Department or the 

Administrator, to come into possession of a document, information, or 

correspondence (whether sent in writing or by authorized electronic 

transmission), as indicated in an official correspondence log, or by a notation 

made on the document, information, or correspondence, by the Department or 

the Administrator in the regular course of business.

41.1.52 "Recordation, record, or recorded" means, with regard to NOx allowances, 

the movement of NOx allowances by the Administrator from one NOx 

Allowance Tracking System account to another, for purposes of allocation, 

transfer, or deduction.

41.1.53 "Reference method" means any direct test method of sampling and analyzing 

for an air pollutant as specified in appendix A of 40 CFR Part 60.

41.1.54 "Serial number" means, when referring to NOx allowances, the unique 

identification number assigned to each NOx allowance by the Administrator, 

under paragraph 41.9.4(c).

41.1.55 "Source" means any governmental, institutional, commercial, or industrial 

structure, installation, plant, building, or facility that emits or has the potential 

to emit any regulated air pollutant under the CAA. For purposes of section 
Page 9 of 66

502(c) of the CAA, a "source," including a "source" with multiple units, shall 

be considered a single "facility."

41.1.56 "State" means one of the 48 contiguous States and the District of Columbia 

specified in 40 CFR 51.121, or any non-federal authority in or including such 

States or the District of Columbia (including local agencies, and Statewide 

agencies) or any eligible Indian tribe in an area of such State or the District of 

Columbia, that adopts a NOx Budget Trading Program pursuant to 40 CFR 

51.121. To the extent a State incorporates by reference the provisions of 40 

CFR Part 96, the term "State" shall mean the incorporating State. The term 

"State" shall have its conventional meaning where such meaning is clear from 

the context.

41.1.57 "State trading program budget" means the total number of NOx tons 

apportioned to all NOx Budget units in a given State, in accordance with the 

NOx Budget Trading Program, for use in a given control period.

41.1.58 "Submit or serve" means to send or transmit a document, information, or 

correspondence to the person specified in accordance with the applicable 

regulation:

(a) In person;

(b) By United States Postal Service; or

(c) By other means of dispatch or transmission and delivery. 

Compliance with any "submission," "service," or "mailing" 

deadline shall be determined by the date of dispatch, transmission, 

or mailing and not the date of receipt.

41.1.59 "Title V operating permit" means an operating permit issued under Air 

Pollution Control Regulation No. 29.

41.1.60 "Ton or tonnage means" any "short ton" (i.e., 2,000 pounds). For the 

purpose of determining compliance with the NOx Budget emissions limitation, 

total tons for a control period shall be calculated as the sum of all recorded 

hourly emissions (or the tonnage equivalent of the recorded hourly emissions 

rates) in accordance with sections 41.10 and 41.11, with any remaining fraction 

of a ton equal to or greater than 0.50 ton deemed to equal one ton and any

fraction of a ton less than 0.50 ton deemed to equal zero tons.

41.1.61 "Unit" means a fossil fuel-fired stationary boiler, combustion turbine, or 

combined cycle system.

41.1.62 "Unit operating day" means a calendar day in which a unit combusts any

fuel.
Page 10 of 66

41.1.63 "Unit operating hour or hour of unit operation" means any hour (or 

fraction of an hour) during which a unit combusts any fuel.

41.1.64 "Utilization" means the heat input (expressed in mmBtu/time) for a unit. The 

unit's total heat input for the control period in each year will be determined in 

accordance with 40 CFR Part 75 if the NOx Budget unit was otherwise subject 

to the requirements of 40 CFR Part 75 for the year, or will be based on the best 

available data reported to the Administrator for the unit if the unit was not 

otherwise subject to the requirements of 40 CFR Part 75 for the year.

41.2 NOx Emission Budget

41.2.1 The NOx Budget Trading Program is established to limit total mass NOx emissions 

from NOx Budget sources during the control period of May 1 through September 30. 

The initial NOx Budget is as follows:

(a) For 2003 and each year thereafter, through and including 2005, not to exceed 

936 tons during each control period.

(b) [Reserved]

41.3 Applicability.

41.3.1 General Applicability

The following units shall be NOx Budget units, and any source that includes one 

or more such units shall be a NOx Budget source, subject to the requirements of 

this regulation:

(a) Any unit that, any time on or after January 1, 1995, serves a generator 

with a nameplate capacity greater than 15 MWe and sells any amount 

of electricity; or

(b) Any unit that is not a unit under paragraph (a) of this section and that 

has a maximum design heat input greater than 250 mmBtu/hr.

41.3.2 Exempted Units

(a) A unit that meets the general applicability requirements under subsection 

41.3.1, that has a federally enforceable permit that meets the requirements 

of paragraph (b) of this subsection, shall not be a NOx Budget unit starting 

with the effective date of such federally enforceable permit.
Page 11 of 66

(b) For each control period, the federally enforceable permit must:

(1) Restrict the unit to burning only natural gas or fuel oil.

(2) Restrict the unit's operating hours to the number calculated by

dividing 25 tons of potential NOx mass emissions by the unit's 

maximum potential hourly NOx mass emissions.

(3) Calculate the unit's potential NOx mass emissions as follows:

(a) Select the default NOx emission rate in Table 1b of 40 CFR 

75.19(c)(1)(ii) that has the highest default NOx emission 

factor of any type of fuel (natural gas or fuel oil) that the 

unit is allowed to burn under the fuel use restriction in 

paragraph (b)(1) of this subsection; and

(b) Multiply the default NOx emission rate selected above by

the unit's maximum rated hourly heat input. The owner or 

operator of the unit may petition the Department to use a 

lower value for the unit's maximum rated hourly heat input 

than the value as defined under 41.1.26. The Department 

may approve such lower value if the owner or operator 

demonstrates that the maximum hourly heat input specified 

by the manufacturer or the highest observed hourly heat 

input, or both, are not representative, and that such lower 

value is representative, of the unit's current capabilities 

because modifications have been made to the unit, limiting 

its capacity permanently.

(4) Require that the owner or operator of the unit shall retain at the 

source that includes the unit, for 5 years, records demonstrating 

that the operating hours restriction, the fuel use restriction, and the 

other requirements of the permit related to these restrictions were 

met.

(5) Require that the owner or operator of the unit shall report the unit's 

hours of operation (treating any partial hour of operation as a 

whole hour of operation) during each control period to the 

Department by November 1 of each year for which the unit is 

subject to the federally enforceable permit.

(c) The Department will notify the Administrator in writing of 

each whose federally enforceable permit issued by the 

Department includes such restrictions. The Department 
Page 12 of 66

will also notify the Administrator in writing of each unit 

whose federally enforceable permit issued by the 

Department is revised to remove any such restriction, 

whose federally enforceable permit issued by the 

Department includes any such restriction that is no longer 

applicable, or which does not comply with any such 

restriction. 

(d) If, for any control period, the fuel use restriction under 

paragraph (b)(1) of this subsection or the operating hours 

restriction under paragraph (b)(2) subsection is removed 

from the unit's federally enforceable permit or otherwise 

becomes no longer applicable or if, for any such control 

period, the unit does not comply with the fuel use 

restriction under paragraph (b)(1) of this subsection or the 

operating hours restriction under paragraph (b)(2) of this 

subsection, the unit shall be a NOx Budget unit, subject to 

the requirements of this regulation. Such unit shall be 

treated as commencing operation and, for a unit under 

paragraph (a) of subsection 41.3.1, commencing 

commercial operation on September 30 of the control 

period for which the fuel use restriction or the operating 

hours restriction is no longer applicable or during which the 

unit does not comply with the fuel use restriction or the 

operating hours restriction.

41.4 General Provisions

41.4.1 Nitrogen oxides requirements.

(a) The owners and operators of each NOx Budget source and each NOx 

Budget unit at the source shall hold NOx allowances available for 

compliance deductions under subsection 41.9.5, as of the NOx allowance 

transfer deadline, in the unit's compliance account and the source's 

overdraft account in an amount not less than the total NOx emissions for 

the control period from the unit, as determined in accordance with sections 

41.10 and 41.11 of this regulation.

(b) Each ton of nitrogen oxides emitted in excess of the NOx Budget 

emissions limitation shall constitute a separate violation of this regulation, 

the CAA, and applicable State law.

(c) A NOx Budget unit shall be subject to the requirements under paragraph 

(a) of this subsection starting on the later of May 1, 2003 or the date on 
Page 13 of 66

which the unit commences operation.

 

(d) NOx allowances shall be held in, deducted from, or transferred among 

NOx Allowance Tracking System accounts in accordance with Sections 

41.5, 41.8, 41.9, and 41.13 of this regulation.

(e) A NOx allowance shall not be deducted, in order to comply with the 

requirements under paragraph (a) of this subsection, for a control period in 

a year prior to the year for which the NOx allowance was allocated.

(f) A NOx allowance allocated by the Department or the Administrator under 

the NOx Budget Trading Program is a limited authorization to emit one 

ton of nitrogen oxides in accordance with the NOx Budget Trading 

Program. No provision of the NOx Budget Trading Program, the NOx 

Budget permit application, the NOx Budget permit, or an exemption under 

section 41.14 and no provision of law shall be construed to limit the 

authority of the United States or the State of Rhode Island to terminate or 

limit such authorization.

(g) A NOx allowance allocated by the Department or the Administrator under 

the NOx Budget Trading Program does not constitute a property right.

(h) Upon recordation by the Administrator under section 41.8, 41.9, or 41.13 

of this regulation, every allocation, transfer, or deduction of a NOx 

allowance to or from a NOx Budget unit's compliance account or the 

overdraft account of the source where the unit is located is deemed to 

amend automatically, and become a part of, any NOx Budget permit of the 

NOx Budget unit by operation of law without any further review.

41.4.2 Excess emissions requirements.

(a) The owners and operators of a NOx Budget unit that has excess emissions 

in any control period shall:

(1) Surrender the NOx allowances required for deduction under 

subsection 41.9.5(d)(1); and

(2) Pay any fine, penalty, or assessment or comply with any other 

remedy imposed under subsection 41.9.5(d)(3).

41.4.3 Recordkeeping and Reporting Requirements.

(a) Unless otherwise provided, the owners and operators of the NOx Budget 

source and each NOx Budget unit at the source shall keep on site at the 

source each of the following documents for a period of 5 years from the 
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date the document is created. This period may be extended for cause, at 

any time prior to the end of 5 years, in writing by the Department or the 

Administrator.

(1) The account certificate of representation for the NOx authorized 

account representative for the source and each NOx Budget unit at 

the source and all documents that demonstrate the truth of the 

statements in the account certificate of representation, in 

accordance with subsection 41.6.5; provided that the certificate and 

documents shall be retained on site at the source beyond such 

5-year period until such documents are superseded because of the 

submission of a new account certificate of representation changing 

the NOx authorized account representative.

(2) All emissions monitoring information, in accordance with sections 

41.10 and 41.11 of this regulation; provided that to the extent that 

section 41.11 of this regulation provides for a 3-year period for 

recordkeeping, the 3-year period shall apply.

(3) Copies of all reports, compliance certifications, and other 

submissions and all records made or required under the NOx 

Budget Trading Program.

(4) Copies of all documents used to complete a NOx Budget permit 

application and any other submission under the NOx Budget 

Trading Program or to demonstrate compliance with the 

requirements of the NOx Budget Trading Program.

(b) The NOx authorized account representative of a NOx Budget source and 

each NOx Budget unit at the source shall submit the reports and 

compliance certifications required under the NOx Budget Trading 

Program, including those under sections 41.10, 41.11, 41.12, or 41.13 of 

this regulation.

41.4.4 Liability.

(a) Any person who knowingly violates any requirement or prohibition of the 

NOx Budget Trading Program, a NOx Budget permit, or an exemption 

under section 41.14 shall be subject to enforcement pursuant to applicable 

State or Federal law. 

(b) Any person who knowingly makes a false material statement in any

record, submission, or report under the NOx Budget Trading Program 

shall be subject to criminal enforcement pursuant to the applicable State or 

Federal law.
Page 15 of 66

(c) No permit revision shall excuse any violation of the requirements of the 

NOx Budget Trading Program that occurs prior to the date that the 

revision takes effect.

(d) Each NOx Budget source and each NOx Budget unit shall meet the 

requirements of the NOx Budget Trading Program.

(e) Any provision of the NOx Budget Trading Program that applies to a NOx 

Budget source (including a provision applicable to the NOx authorized 

account representative of a NOx Budget source) shall also apply to the 

owners and operators of such source and of the NOx Budget units at the 

source.

(f) Any provision of the NOx Budget Trading Program that applies to a NOx 

Budget unit (including a provision applicable to the NOx authorized 

account representative of a NOx budget unit) shall also apply to the 

owners and operators of such unit. Except with regard to the requirements 

applicable to units with a common stack under sections 41.10 or 41.11 of 

this regulation, the owners and operators and the NOx authorized account 

representative of one NOx Budget unit shall not be liable for any violation 

by any other NOx Budget unit of which they are not owners or operators 

or the NOx authorized account representative and that is located at a 

source of which they are not owners or operators or the NOx authorized 

account representative.

41.4.5 Effect on Other Authorities.

No provision of the NOx Budget Trading Program, a NOx Budget permit 

application, a NOx Budget permit, or an exemption under section 41.14 shall be 

construed as exempting or excluding the owners and operators and, to the extent 

applicable, the NOx authorized account representative of a NOx Budget source or 

NOx Budget unit from compliance with any other provision of the Rhode Island 

State Implementation plan, a federally enforceable permit, or the CAA.

41.4.6 Computation of time.

 

(a) Unless otherwise stated, any time period scheduled, under the NOx Budget 

Trading Program, to begin on the occurrence of an act or event shall begin 

on the day the act or event occurs.

(b) Unless otherwise stated, any time period scheduled, under the NOx Budget 

Trading Program, to begin before the occurrence of an act or event shall be 

computed so that the period ends the day before the act or event occurs.
Page 16 of 66

 (c) Unless otherwise stated, if the final day of any time period, under the NOx 

Budget Trading Program, falls on a weekend or a Rhode Island or Federal 

holiday, the time period shall be extended to the next business day.

41.5 NOx Allowance Allocations

41.5.1 Timing requirements for NOx allowance allocations.

(a) By April 1, 2003 and April 1 of each year thereafter, the Department will 

submit to the Administrator the NOx allowance allocations for the control 

period in the year that is three years after the year of the applicable 

deadline for submission under this paragraph. If the Department fails to 

submit to the Administrator the NOx allowance allocations in accordance 

with this paragraph, the Administrator will allocate, for the applicable 

control period, the same number of NOx allowances as were allocated for 

the preceding control period.

41.5.2 (a) The initial allocation of allowances, for each control period, by budget 

source, for the allocation period 2003-2005 is as follows:

Budget source Allowance Allocation

Ocean State Power 275

Pawtucket Power Associates 42

Manchester Street Station 262

Tiverton Power Associates 46

(b) [Reserved]

41.5.3 [Reserved for a possible new source set aside or energy efficiency and 

renewable energy set aside.]

41.6 NOx Authorized Account Representative for NOx Budget Sources

41.6.1 Authorization and responsibilities of the NOx authorized account representative.

(a) Except as provided under subsection 41.6.2, each NOx Budget source, 

including all NOx Budget units at the source, shall have one and only one 

NOx authorized account representative, with regard to all matters under 

the NOx Budget Trading Program concerning the source or any NOx 

Budget unit at the source.

(b) The NOx authorized account representative of the NOx Budget source 

shall be selected by an agreement binding on the owners and operators of 

the source and all NOx Budget units at the source. 
Page 17 of 66

(c) Upon receipt by the Administrator of a complete account certificate of 

representation under subsection 41.6.5, the NOx authorized account 

representative of the source shall represent and, by his or her 

representations, actions, inactions, or submissions, legally bind each owner 

and operator of the NOx Budget source represented and each NOx Budget 

unit at the source in all matters pertaining to the NOx Budget Trading 

Program, not withstanding any agreement between the NOx authorized 

account representative and such owners and operators. The owners and 

operators shall be bound by any decision or order issued to the NOx 

authorized account representative by the Department, the Administrator, or 

a court regarding the source or unit.

(d) No NOx Budget permit shall be issued, and no NOx Allowance Tracking 

System account shall be established for a NOx Budget unit at a source, 

until the Administrator has received a complete account certificate of 

representation under subsection 41.6.5 for a NOx authorized account 

representative of the source and the NOx Budget units at the source.

(e) Each submission under the NOx Budget Trading Program shall be 

submitted, signed, and certified by the NOx authorized account 

representative for each NOx Budget source on behalf of which the 

submission is made. Each such submission shall include the following 

certification statement by the NOx authorized account representative:

"I am authorized to make this submission on behalf of 

the owners and operators of the NOx Budget sources or 

NOx Budget units for which the submission is made. I 

certify under penalty of law that I have personally 

examined, and am familiar with, the statements and 

information submitted in this document and all its 

attachments. Based on my inquiry of those individuals 

with primary responsibility for obtaining the 

information, I certify that the statements and 

information are to the best of my knowledge and belief 

true, accurate, and complete. I am aware that there are 

significant penalties for submitting false statements and 

information or omitting required statements and 

information, including the possibility of fine or 

imprisonment."

The Department and the Administrator will accept or act on a submission made on 

behalf of owner or operators of a NOx Budget source or a NOx Budget unit only

if the submission has been made, signed, and certified in accordance with 

paragraph (e) of this subsection.
Page 18 of 66

41.6.2 Alternate NOx authorized account representative.

(a) An account certificate of representation may designate one and only one 

alternate NOx authorized account representative who may act on behalf of 

the NOx authorized account representative. The agreement by which the 

alternate NOx authorized account representative is selected shall include a 

procedure for authorizing the alternate NOx authorized account 

representative to act in lieu of the NOx authorized account representative.

(b) Upon receipt by the Administrator of a complete account certificate of 

representation under subsection 41.6.5, any representation, action, 

inaction, or submission by the alternate NOx authorized account 

representative shall be deemed to be a representation, action, inaction, or 

submission by the NOx authorized account representative.

(c) Except in this subsection and 41.6.1(a), 41.6.4, 41.6.5, and 41.9.2, 

whenever the term "NOx authorized account representative" is used in this 

regulation, the term shall be construed to include the alternate NOx 

authorized account representative.

41.6.3 Changing the NOx authorized account representative and the alternate NOx 

authorized account representative.

(a) Changing the NOx authorized account representative. The NOx 

authorized account representative may be changed at any time upon receipt 

by the Administrator of a superseding complete account certificate of 

representation under subsection 41.6.5. Notwithstanding any such change, 

all representations, actions, inactions, and submissions by the previous 

NOx authorized account representative prior to the time and date when the 

Administrator receives the superseding account certificate of 

representation shall be binding on the new NOx authorized account

representative and the owners and operators of the NOx Budget source and 

the NOx Budget units at the source. 

(b) Changing the alternate NOx authorized account representative. The 

alternate NOx authorized account representative may be changed at any

time upon receipt by the Administrator of a superseding complete account 

certificate of representation under subsection 41.6.5. Notwithstanding any

such change, all representations, actions, inactions, and submissions by the 

previous alternate NOx authorized account representative prior to the time 

and date when the Administrator receives the superseding account 

certificate of representation shall be binding on the new alternate NOx 

authorized account representative and the owners and operators of the 

NOx Budget source and the NOx Budget units at the source. 
Page 19 of 66

41.6.4 Changes in the owners and operators.

(a) In the event a new owner or operator of a NOx Budget source or a NOx 

Budget unit is not included in the list of owners and operators submitted in 

the account certificate of representation, such new owner or operator shall 

be deemed to be subject to and bound by the account certificate of 

representation, the representations, actions, inactions, and submissions of 

the NOx authorized account representative and any alternate NOx 

authorized account representative of the source or unit, and the decisions, 

orders, actions, and inactions of the Department or the Administrator, as if 

the new owner or operator were included in such list.

(b) Within 30 days following any change in the owners and operators of a 

NOx Budget source or a NOx Budget unit, including the addition of a new 

owner or operator, the NOx authorized account representative or alternate 

NOx authorized account representative shall submit a revision to the 

account certificate of representation amending the list of owners and 

operators to include the change.

41.6.5 Account certificate of representation.

(a) A complete account certificate of representation for a NOx authorized 

account representative or an alternate NOx authorized account 

representative shall include the following elements in a format prescribed 

by the Administrator:

(1) Identification of the NOx Budget source and each NOx Budget unit 

at the source for which the account certificate of representation is 

submitted.

(2) The name, address, e-mail address (if any), telephone number, and 

facsimile transmission number (if any) of the NOx authorized 

account representative and any alternate NOx authorized account 

representative.

(3) A list of the owners and operators of the NOx Budget source and 

of each NOx Budget unit at the source.

(4) The following certification statement by the NOx authorized 

account representative and any alternate NOx authorized account 

representative:

"I certify that I was selected as the NOx authorized 

account representative or alternate NOx authorized 

account representative, as applicable, by an agreement 
Page 20 of 66

binding on the owners and operators of the NOx Budget 

source and each NOx Budget unit at the source. I certify 

that I have all the necessary authority to carry out my 

duties and responsibilities under the NOx Budget 

Trading Program on behalf of the owners and operators 

of the NOx Budget source and of each NOx Budget unit 

at the source and that each such owner and operator 

shall be fully bound by my representations, actions, 

inactions, or submissions and by any decision or order 

issued to me by the Department, the Administrator, or a 

court regarding the source or unit." 

(5) The signature of the NOx authorized account representative and 

any alternate NOx authorized account representative and the dates 

signed.

(b) Unless otherwise required by the Department or the Administrator, 

documents of agreement referred to in the account certificate of 

representation shall not be submitted to the Department or the 

Administrator. Neither the Department nor the Administrator shall be 

under any obligation to review or evaluate the sufficiency of such 

documents, if submitted.

41.6.6 Objections concerning the NOx authorized account representative.

(a) Once a complete account certificate of representation under subsection 

41.6.5 has been submitted and received, the Department and the 

Administrator will rely on the account certificate of representation unless 

and until a superseding complete account certificate of representation 

under subsection 41.6.5 is received by the Administrator.

(b) Except as provided in subsection 41.6.3, no objection or other 

communication submitted to the Department or the Administrator 

concerning the authorization, or any representation, action, inaction, or 

submission of the NOx authorized account representative shall affect any

representation, action, inaction, or submission of the NOx authorized 

account representative or the finality of any decision or order by the 

Department or the Administrator under the NOx Budget Trading Program. 

(c) Neither the Department nor the Administrator will adjudicate any private 

legal dispute concerning the authorization or any representation, action, 

inaction, or submission of any NOx authorized account representative, 

including private legal disputes concerning the proceeds of NOx allowance

transfers. 
Page 21 of 66

41.7 Permits

41.7.1 Permit Requirements.

(a) The NOx authorized account representative of each NOx Budget source 

required to have a federally enforceable permit and each NOx Budget unit 

required to have a federally enforceable permit at the source shall:

(1) Submit to the Department a complete NOx Budget permit 

application under subsection 41.7.4 in accordance with the 

deadlines specified in subsection 41.7.3(b), (c) and (d);

 (2) Submit in a timely manner any supplemental information that the 

Department determines is necessary in order to review a NOx

Budget permit application and issue or deny a NOx Budget permit.

 

(b) The owners and operators of each NOx Budget source required to have a 

federally enforceable permit and each NOx Budget unit required to have a 

federally enforceable permit at the source shall have a NOx Budget permit 

issued by the Department and operate the unit in compliance with such 

NOx Budget permit.

(c) The owners and operators of a NOx Budget source that is not otherwise 

required to have a federally enforceable permit are not required to submit a 

NOx Budget permit application, and to have a NOx Budget permit, under 

section 41.7 of this regulation for such NOx Budget source. 

41.7.2 General NOx budget trading program permit requirements.

(a) For each NOx Budget source required to have a federally enforceable 

permit, such permit shall include a NOx Budget permit administered by

the Department.

(1) For NOx Budget sources required to have a title V operating 

permit, the NOx Budget portion of the title V permit shall be 

administered in accordance with Air Pollution Control Regulation

No. 29, except as provided otherwise by this section or section 

41.13 of this regulation.

(2) For NOx Budget sources required to have a non-title V permit, the 

NOx Budget portion of the non-title V permit shall be administered 

in accordance with the Department's regulations promulgated to 

administer non-title V permits, except as provided otherwise by

this section or section 41.13 of this regulation.
Page 22 of 66

(b) Each NOx Budget permit (including a draft or proposed NOx Budget 

permit, if applicable) shall contain all applicable NOx Budget Trading 

Program requirements and shall be a complete and segregable portion of 

the permit under paragraph (a) of this subsection.

41.7.3 NOx Budget permit applications.

(a) The NOx authorized account representative of any NOx Budget source 

required to have a federally enforceable permit shall submit to the 

Department a complete NOx Budget permit application under subsection 

41.7.4 by the applicable deadline in paragraph (b) or (c) of this subsection.

(b) For NOx Budget sources required to have a title V operating permit:

a. For any source, with one or more NOx Budget units under 

subsection 41.3.1 that commences operation before January 1, 

2000, the NOx authorized account representative shall submit a 

complete NOx Budget permit application under subsection 41.7.4 

covering such NOx Budget units to the Department before 

November 1, 2001.

b. For any source, with any NOx Budget unit under subsection 41.3.1 

that commences operation on or after January 1, 2000, the NOx 

authorized account representative shall submit a complete NOx 

Budget permit application under subsection 41.7.4 covering such 

NOx Budget unit to the Department at least 18 months before the 

later of May 1, 2003 or the date on which the NOx Budget unit 

commences operation.

(c) For NOx Budget sources required to have a non-title V permit:

a. For any source, with one or more NOx Budget units under 

subsection 41.3.1 that commences operation before January 1, 

2000, the NOx authorized account representative shall submit a 

complete NOx Budget permit application under subsection 41.7.4 

covering such NOx Budget units to the Department before 

November 1, 2001.

b. For any source, with any NOx Budget unit under subsection 41.3.1 

that commences operation on or after January 1, 2000, the NOx 

authorized account representative shall submit a complete NOx 

Budget permit application under subsection 41.7.4 covering such 

NOx Budget unit to the Department at least 18 months before the 

later of May 1, 2003 or the date on which the NOx Budget unit 
Page 23 of 66

commences operation.

(d) Duty to Reapply.

(1) For a NOx Budget source required to have a title V operating 

permit, the NOx authorized account representative shall submit a 

complete NOx Budget permit application under subsection 41.7.4 

for the NOx Budget source covering the NOx Budget units at the 

source in accordance with the provisions of Air Pollution Control 

Regulation No. 29 addressing permit renewals.

(2) For a NOx Budget source required to have a non-title V permit, the 

NOx authorized account representative shall submit a complete 

NOx Budget permit application under subsection 41.7.4 for the 

NOx Budget source covering the NOx Budget units at the source in 

accordance with the Departments non-title V permits regulations 

addressing permit renewal.

41.7.4 Information requirements for NOx Budget permit applications.

A complete NOx Budget permit application shall include the following elements 

concerning the NOx Budget source, for which the application is submitted, in a 

format prescribed by the Department:

(a) Identification of the NOx Budget source, including plant name and the 

ORIS (Office of Regulatory Information Systems) or facility code assigned 

to the source by the Energy Information Administration, if applicable;

(b) Identification of each NOx Budget unit at the NOx Budget source and 

whether it is a NOx Budget unit under subsection 41.3.1 or under section 

41.13 of this regulation; 

(c) The standard requirements under 40 CFR 96.6; and

(d) For each NOx Budget opt-in unit at the NOx Budget source, the following 

certification statements by the NOx authorized account representative:

(1) "I certify that each unit for which this permit application is 

submitted under section 41.13 of Air Pollution Control Regulation 

No. 41 is not a NOx Budget unit under section 41.3 and is not 

covered by a retired unit exemption under section 41.14 that is in 

effect."

(1) If the application is for an initial NOx Budget opt-in permit: 
Page 24 of 66

"I certify that each unit for which this permit application is 

submitted under section 41.13 of Air Pollution Control Regulation 

No. 41 is currently operating, as that term is defined under section 

41.1"

41.7.5 NOx Budget permit contents.

(a) Each NOx Budget permit (including any draft or proposed NOx Budget 

permit, if applicable) will contain, in a format prescribed by the 

Department, all elements required for a complete NOx Budget permit 

application under subsection 41.7.4 as approved or adjusted by the 

Department.

(b) Each NOx Budget permit is deemed to incorporate automatically the 

definitions of terms under section 41.1 and, upon recordation by the 

Administrator under sections 41.8, 41.9, or 41.13 of this regulation, every

allocation, transfer, or deduction of a NOx allowance to or from the 

compliance accounts of the NOx Budget units covered by the permit or the 

overdraft account of the NOx Budget source covered by the permit.

41.7.6 Effective date of initial NOx Budget permit.

The initial NOx Budget permit covering a NOx Budget unit for which a complete 

NOx Budget permit application is timely submitted under the applicable provision 

of subsection 41.7.3(b) or (c) or shall become effective by the later of:

(a) May 1, 2003;

(b) May 1 of the year in which the NOx Budget unit commences operation, if 

the unit commences operation on or before May 1 of that year; 

(c) The date on which the NOx Budget unit commences operation, if the unit 

commences operation during a control period; or

(d) May 1 of the year following the year in which the NOx Budget unit 

commences operation, if the unit commences operation on or after October 

1 of the year.

41.7.7 NOx Budget permit revisions.

(a) For a NOx Budget source with a title V operating permit, except as 

provided in subsection 41.7.5(b), the Department will revise the NOx 

Budget permit, as necessary, in accordance with the provisions of Air 

Pollution Control Regulation No. 29 addressing permit revisions.
Page 25 of 66

(b) For a NOx Budget source with a non-title V permit, except as provided in 

subsection 41.7.5(b), the Department will revise the NOx Budget permit, 

as necessary, in accordance with the Department's non-title V permits 

regulations addressing permit revisions.

41.8 NOx Allowance Transfers

41.8.1 Submission of NOx allowance transfers.

The NOx authorized account representatives seeking recordation of a NOx 

allowance transfer shall submit the transfer to the Administrator. To be 

considered correctly submitted, the NOx allowance transfer shall include the 

following elements in a format specified by the Administrator:

(a) The numbers identifying both the transferor and transferee accounts;

(b) A specification by serial number of each NOx allowance to be transferred; 

and

(c) The printed name and signature of the NOx authorized account 

representative of the transferor account and the date signed.

41.8.2 EPA recordation.

(a) Within 5 business days of receiving a NOx allowance transfer, except as 

provided in paragraph (b) of this subsection, the Administrator will record 

a NOx allowance transfer by moving each NOx allowance from the 

transferor account to the transferee account as specified by the request, 

provided that:

(1) The transfer is correctly submitted under section 41.8; 

(2) The transferor account includes each NOx allowance identified by

serial number in the transfer; and

(3) The transfer meets all other requirements of this regulation.

(b) A NOx allowance transfer that is submitted for recordation following the 

NOx allowance transfer deadline and that includes any NOx allowances 

allocated for a control period prior to or the same as the control period to 

which the NOx allowance transfer deadline applies will not be recorded 

until after completion of the process of recordation of NOx allowance 
Page 26 of 66

allocations in subsection 41.9.4(b).

(c) Where a NOx allowance transfer submitted for recordation fails to meet 

the requirements of paragraph (a) of this section, the Administrator will 

not record such transfer.

41.8.3 Notification.

(a) Notification of recordation. Within 5 business days of recordation of a 

NOx allowance transfer under subsection 41.8.2, the Administrator will 

notify each party to the transfer. Notice will be given to the NOx 

authorized account representatives of both the transferor and transferee 

accounts.

(b) Notification of non-recordation. Within 10 business days of receipt of a 

NOx allowance transfer that fails to meet the requirements of subsection 

41.8.2(a), the Administrator will notify the NOx authorized account 

representatives of both accounts subject to the transfer of:

(1) A decision not to record the transfer, and

(2) The reasons for such non-recordation.

(c) Nothing in this section shall preclude the submission of a NOx allowance 

transfer for recordation following notification of non-recordation.

41.9 NOx Allowance Tracking System

41.9.1 NOx Allowance Tracking System accounts.

(a) Nature and function of compliance accounts and overdraft accounts. 

Consistent with subsection 41.9(a), the Administrator will establish one 

compliance account for each NOx Budget unit and one overdraft account 

for each source with two or more NOx Budget units. Allocations of NOx 

allowances pursuant to section 41.5 or subsection 41.13.9 and deductions 

or transfers of NOx allowances pursuant to subsections 41.12.2, 41.9.5, 

41.9.7, section 41.8, or section 41.13 will be recorded in the compliance 

accounts or overdraft accounts in accordance with this subpart.

(b) Nature and function of general accounts. Consistent with subsection 

41.9.2(b), the Administrator will establish, upon request, a general account 

for any person. Transfers of allowances pursuant to section 41.8 will be 

recorded in the general account in accordance with this section.
Page 27 of 66

41.9.2 Establishment of accounts.

(a) Compliance accounts and overdraft accounts. Upon receipt of a complete 

account certificate of representation under subsection 41.6.5, the 

Administrator will establish:

(1) A compliance account for each NOx Budget unit for which the 

account certificate of representation was submitted; and

(2) An overdraft account for each source for which the account 

certificate of representation was submitted and that has two or 

more NOx Budget units. 

(b) General accounts.

(1) Any person may apply to open a general account for the purpose of 

holding and transferring allowances. A complete application for a 

general account shall be submitted to the Administrator and shall 

include the following elements in a format prescribed by the 

Administrator:

a. Name, mailing address, e-mail address (if any), telephone 

number, and facsimile transmission number (if any) of the 

NOx authorized account representative and any alternate 

NOx authorized account representative;

b. At the option of the NOx authorized account representative, 

organization name and type of organization;

c. A list of all persons subject to a binding agreement for the 

NOx authorized account representative or any alternate 

NOx authorized account representative to represent their 

ownership interest with respect to the allowances held in 

the general account;

d. The following certification statement by the NOx 

authorized account representative and any alternate NOx 

authorized account representative: 

"I certify that I was selected as the NOx 

authorized account representative or the NOx 

alternate authorized account representative, as 

applicable, by an agreement that is binding on 

all persons who have an ownership interest with 

respect to allowances held in the general 
Page 28 of 66

account. I certify that I have all the necessary 

authority to carry out my duties and 

responsibilities under the NOx Budget Trading 

Program on behalf of such persons and that 

each such person shall be fully bound by my 

representations, actions, inactions, or 

submissions and by any order or decision issued 

to me by the Administrator or a court regarding 

the general account." 

e. The signature of the NOx authorized account representative 

and any alternate NOx authorized account representative 

and the dates signed.

f. Unless otherwise required by the Department or the 

Administrator, documents of agreement referred to in the 

account certificate of representation shall not be submitted 

to the Department or the Administrator. Neither the 

Department nor the Administrator shall be under any

obligation to review or evaluate the sufficiency of such 

documents, if submitted.

(2) Upon receipt by the Administrator of a complete application for a 

general account under paragraph (b)(1) of this subsection: 

a. The Administrator will establish a general account for the 

person or persons for whom the application is submitted. 

b. The NOx authorized account representative and any

alternate NOx authorized account representative for the 

general account shall represent and, by his or her 

representations, actions, inactions, or submissions, legally

bind each person who has an ownership interest with 

respect to NOx allowances held in the general account in all

matters pertaining to the NOx Budget Trading Program, not 

withstanding any agreement between the NOx authorized 

account representative or any alternate NOx authorized 

account representative and such person. Any such person 

shall be bound by any order or decision issued to the NOx 

authorized account representative or any alternate NOx 

authorized account representative by the Administrator or a 

court regarding the general account. 

c. Each submission concerning the general account shall be 

submitted, signed, and certified by the NOx authorized 

account representative or any alternate NOx authorized 
Page 29 of 66

account representative for the persons having an ownership 

interest with respect to NOx allowances held in the general 

account. Each such submission shall include the following 

certification statement by the NOx authorized account 

representative or any alternate NOx authorized account 

representative any: 

"I am authorized to make this submission on 

behalf of the persons having an ownership 

interest with respect to the NOx allowances held 

in the general account. I certify under penalty 

of law that I have personally examined, and am 

familiar with, the statements and information 

submitted in this document and all its 

attachments. Based on my inquiry of those 

individuals with primary responsibility for 

obtaining the information, I certify that the 

statements and information are to the best of my 

knowledge and belief true, accurate, and 

complete. I am aware that there are significant 

penalties for submitting false statements and 

information or omitting required statements and 

information, including the possibility of fine or 

imprisonment."

d. The Administrator will accept or act on a 

submission concerning the general account only if 

the submission has been made, signed, and certified 

in accordance with paragraph (b)(2) c. of this 

subsection.

(3) a. An application for a general account may designate one and 

only one NOx authorized account representative and one 

and only one alternate NOx authorized account 

representative who may act on behalf of the NOx 

authorized account representative. The agreement by

which the alternate NOx authorized account representative 

is selected shall include a procedure for authorizing the 

alternate NOx authorized account representative to act in 

lieu of the NOx authorized account representative.

b. Upon receipt by the Administrator of a complete 

application for a general account under paragraph (b)(1) of 

this subsection, any representation, action, inaction, or 

submission by any alternate NOx authorized account 
Page 30 of 66

representative shall be deemed to be a representation, 

action, inaction, or submission by the NOx authorized 

account representative.

(4) a. The NOx authorized account representative for a general 

account may be changed at any time upon receipt by the 

Administrator of a superseding complete application for a 

general account under paragraph (b)(1) of this subsection. 

Notwithstanding any such change, all representations, 

actions, inactions, and submissions by the previous NOx 

authorized account representative prior to the time and date 

when the Administrator receives the superseding 

application for a general account shall be binding on the 

new NOx authorized account representative and the persons 

with an ownership interest with respect to the allowances in 

the general account.

b. The alternate NOx authorized account representative for a 

general account may be changed at any time upon receipt 

by the Administrator of a superseding complete application 

for a general account under paragraph (b)(1) of this 

subsection. Notwithstanding any such change, all 

representations, actions, inactions, and submissions by the 

previous alternate NOx authorized account representative 

prior to the time and date when the Administrator receives 

the superseding application for a general account shall be 

binding on the new alternate NOx authorized account 

representative and the persons with an ownership interest 

with respect to the allowances in the general account.

c. In the event a new person having an ownership interest with 

respect to NOx allowances in the general account is not 

included in the list of such persons in the account certificate 

of representation, such new person shall be deemed to be 

subject to and bound by the account certificate of 

representation, the representation, actions, inactions, and 

submissions of the NOx authorized account representative 

and any alternate NOx authorized account representative of 

the source or unit, and the decisions, orders, actions, and 

inactions of the Administrator, as if the new person were 

included in such list.

d. Within 30 days following any change in the persons having 

an ownership interest with respect to NOx allowances in 

the general account, including the addition of persons, the 
Page 31 of 66

NOx authorized account representative or any alternate 

NOx authorized account representative shall submit a 

revision to the application for a general account amending 

the list of persons having an ownership interest with respect 

to the NOx allowances in the general account to include the 

change.

(5) a. Once a complete application for a general account under 

paragraph (b)(1) of this subsection has been submitted and 

received, the Administrator will rely on the application 

unless and until a superseding complete application for a 

general account under paragraph (b)(1) of this subsection is 

received by the Administrator.

b. Except as provided in paragraph (b)(4) of this subsection, 

no objection or other communication submitted to the 

Administrator concerning the authorization, or any

representation, action, inaction, or submission of the NOx 

authorized account representative or any alternate NOx 

authorized account representative for a general account 

shall affect any representation, action, inaction, or 

submission of the NOx authorized account representative or

any alternate NOx authorized account representative or the 

finality of any decision or order by the Administrator under 

the NOx Budget Trading Program. 

c. The Administrator will not adjudicate any private legal 

dispute concerning the authorization or any representation, 

action, inaction, or submission of the NOx authorized

account representative or any alternate NOx authorized 

account representative for a general account, including 

private legal disputes concerning the proceeds of NOx 

allowance transfers. 

(c) Account identification. The Administrator will assign a unique identifying 

number to each account established under paragraph (a) or (b) of this 

subsection.

41.9.3 NOx Allowance Tracking System responsibilities of NOx authorized account 

representative.

(a) Following the establishment of a NOx Allowance Tracking System 

account, all submissions to the Administrator pertaining to the account, 

including, but not limited to, submissions concerning the deduction or 

transfer of NOx allowances in the account, shall be made only by the NOx 
Page 32 of 66

authorized account representative for the account.

(b) Authorized account representative identification. The Administrator will 

assign a unique identifying number to each NOx authorized account 

representative.

41.9.4 Recordation of NOx allowance allocations.

(a) The Administrator will record the NOx allowances for 2003 in the NOx 

Budget units' compliance accounts and the allocation set-asides, as 

allocated under section 41.5. The Administrator will also record the NOx 

allowances allocated under subsection 41.13.9(a)(1) for each NOx Budget 

opt-in source in its compliance account. 

(b) Each year, after the Administrator has made all deductions from a NOx 

Budget unit's compliance account and the overdraft account pursuant to 

subsection 41.9.5, the Administrator will record NOx allowances, as 

allocated to the unit under section 41.5 or under subsection 41.13.9(a)(2), 

in the compliance account for the year after the last year for which 

allowances were previously allocated to the compliance account. Each 

year, the Administrator will also record NOx allowances, as allocated 

under section 41.5, in the allocation set-aside for the year after the last year 

for which allowances were previously allocated to an allocation set-aside. 

(c) Serial numbers for allocated NOx allowances. When allocating NOx 

allowances to and recording them in an account, the Administrator will 

assign each NOx allowance a unique identification number that will 

include digits identifying the year for which the NOx allowance is 

allocated.

41.9.5 Compliance.

(a) NOx allowance transfer deadline. The NOx allowances are available to be 

deducted for compliance with a unit's NOx Budget emissions limitation 

for a control period in a given year only if the NOx allowances:

(1) Were allocated for a control period in a prior year or the same year; 

and 

(2) Are held in the unit's compliance account, or the overdraft account 

of the source where the unit is located, as of the NOx allowance 

transfer deadline for that control period or are transferred into the 

compliance account or overdraft account by a NOx allowance 

transfer correctly submitted for recordation under subsection 41.8.1 

by the NOx allowance transfer deadline for that control period.
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(b) Deductions for compliance.

(1) Following the recordation, in accordance with subsection 41.8.2, of 

NOx allowance transfers submitted for recordation in the unit's 

compliance account or the overdraft account of the source where 

the unit is located by the NOx allowance transfer deadline for a 

control period, the Administrator will deduct NOx allowances 

available under paragraph (a) of this subsection to cover the unit's 

NOx emissions (as determined in accordance with sections 41.10 

and 41.11):

a. From the compliance account; and

b. Only if no more NOx allowances available under paragraph 

(a) of this subsection remain in the compliance account, 

from the overdraft account. In deducting allowances for 

units at the source from the overdraft account, the 

Administrator will begin with the unit having the 

compliance account with the lowest NOx Allowance 

Tracking System account number and end with the unit 

having the compliance account with the highest NOx 

Allowance Tracking System account number (with account 

numbers sorted beginning with the left-most character and 

ending with the right-most character and the letter 

characters assigned values in alphabetical order and less 

than all numeric characters).

(2) The Administrator will deduct NOx allowances first under 

paragraph (b)(1) a. of this subsection and then under paragraph

(b)(1) b. of this subsection:

a. Until the number of NOx allowances deducted for the 

control period equals the number of tons of NOx emissions, 

determined in accordance with sections 41.10 and 41.11, 

from the unit for the control period for which compliance is 

being determined; or

b. Until no more NOx allowances available under paragraph 

(a) of this subsection remain in the respective account.

(c) Identification of NOx allowances by serial number. 

(1) The NOx authorized account representative for each compliance 

account may identify by serial number the NOx allowances to be 

deducted from the unit's compliance account under paragraph (b), 
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(d), or (e) of this subsection. Such identification shall be made in 

the compliance certification report submitted in accordance with 

subsection 41.12.1.

(2) First-in, first-out. The Administrator will deduct NOx allowances 

for a control period from the compliance account, in the absence of 

an identification or in the case of a partial identification of NOx 

allowances by serial number under paragraph (c)(1) of this 

subsection, or the overdraft account on a first-in, first-out (FIFO) 

accounting basis in the following order:

a. Those NOx allowances that were allocated for the control 

period to the unit under sections 41.5 or 41.13;

b. Those NOx allowances that were allocated for the control 

period to any unit and transferred and recorded in the 

account pursuant to section 41.8, in order of their date of 

recordation; 

c. Those NOx allowances that were allocated for a prior 

control period to the unit under sections 41.5 or 41.13; and

d. Those NOx allowances that were allocated for a prior 

control period to any unit and transferred and recorded in 

the account pursuant to section 41.8, in order of their date 

of recordation. 

(d) Deductions for excess emissions.

(1) After making the deductions for compliance under paragraph (b) of 

this subsection, the Administrator will deduct from the unit's 

compliance account or the overdraft account of the source where 

the unit is located a number of NOx allowances, allocated for a 

control period after the control period in which the unit has excess 

emissions, equal to three times the number of the unit's excess 

emissions. 

(2) If the compliance account or overdraft account does not contain 

sufficient NOx allowances, the Administrator will deduct the 

required number of NOx allowances, regardless of the control 

period for which they were allocated, whenever NOx allowances 

are recorded in either account.

(3) Any allowance deduction required under paragraph (d) of this 

subsection shall not affect the liability of the owners and operators 
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of the NOx Budget unit for any fine, penalty, or assessment, or 

their obligation to comply with any other remedy, for the same 

violation, as ordered under the CAA or applicable State law. The 

following guidelines will be followed in assessing fines, penalties 

or other obligations:

a. For purposes of determining the number of days of 

violation, if a NOx Budget unit has excess emissions for a 

control period, each day in the control period (153 days) 

constitutes a day in violation unless the owners and 

operators of the unit demonstrate that a lesser number of 

days should be considered.

b. Each ton of excess emissions is a separate violation. 

(e) Deductions for units sharing a common stack. In the case of units sharing 

a common stack and having emissions that are not separately monitored or 

apportioned in accordance with sections 41.10 and 41.11:

(1) The NOx authorized account representative of the units may

identify the percentage of NOx allowances to be deducted from 

each such unit's compliance account to cover the unit's share of 

NOx emissions from the common stack for a control period. Such 

identification shall be made in the compliance certification report 

submitted in accordance with subsection 41.12.1. 

(2) Notwithstanding paragraph (b)(2) a. of this subsection, the 

Administrator will deduct NOx allowances for each such unit until 

the number of NOx allowances deducted equals the unit's 

identified percentage (under paragraph (e)(1) of this subsection) of 

the number of tons of NOx emissions, as determined in accordance 

with sections 41.10 and 41.11, from the common stack for the 

control period for which compliance is being determined or, if no 

percentage is identified, an equal percentage for each such unit.

(f) The Administrator will record in the appropriate compliance account or 

overdraft account all deductions from such an account pursuant to 

paragraphs (b), (d), or (e) of this subsection. 

41.9.6 Banking.

(a) NOx allowances may be banked for future use or transfer in a compliance 

account, an overdraft account, or a general account, as follows:

(1) Any NOx allowance that is held in a compliance account, an 

overdraft account, or a general account will remain in such account 
Page 36 of 66

unless and until the NOx allowance is deducted or transferred 

under subsections 41.12.2, 41.9.5, 41.9.7, section 41.8, or section 

41.13. 

(2) The Administrator will designate, as a "banked" NOx allowance, 

any NOx allowance that remains in a compliance account, an 

overdraft account, or a general account after the Administrator has 

made all deductions for a given control period from the compliance 

account or overdraft account pursuant to subsection 41.9.5. 

(b) Each year starting in 2004, after the Administrator has completed the 

designation of banked NOx allowances under paragraph (a)(2) of this 

subsection and before May 1of the year, the Administrator will determine 

the extent to which banked NOx allowances may be used for compliance 

in the control period for the current year, as follows:

(1) The Administrator will determine the total number of banked NOx 

allowances held in compliance accounts, overdraft accounts, or 

general accounts. 

(2) If the total number of banked NOx allowances determined, under 

paragraph (b)(1) of this subsection, to be held in compliance 

accounts, overdraft accounts, or general accounts is less than or 

equal to 10% of the sum of the State trading program budgets for 

the control period for the States in which NOx Budget units are 

located, any banked NOx allowance may be deducted for 

compliance in accordance with subsection 41.9.5. 

(3) If the total number of banked NOx allowances determined, under 

paragraph (b)(1) of this subsection, to be held in compliance 

accounts, overdraft accounts, or general accounts exceeds 10% of 

the sum of the State trading program budgets for the control period 

for the States in which NOx Budget units are located, any banked 

allowance may be deducted for compliance in accordance with 

subsection 41.9.5, except as follows:

a. The Administrator will determine the following ratio: 0.10 

multiplied by the sum of the State trading program budgets 

for the control period for the States in which NOx Budget 

units are located and divided by the total number of banked 

NOx allowances determined, under paragraph (b)(1) of this 

subsection, to be held in compliance accounts, overdraft 

accounts, or general accounts.

*b. The Administrator will multiply the number of banked 
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NOx allowances in each compliance account or overdraft 

account. The resulting product is the number of banked 

NOx allowances in the account that may be deducted for 

compliance in accordance with subsection 41.9.5. Any

banked NOx allowances in excess of the resulting product 

may be deducted for compliance in accordance with 

subsection 41.9.5, except that, if such NOx allowances are 

used to make a deduction, two such NOx allowances must 

be deducted for each deduction of one NOx allowance 

required under subsection 41.9.5.

41.9.7 Account error.

The Administrator may, at his or her sole discretion and on his or her own motion, 

correct any error in any NOx Allowance Tracking System account. Within 10 

business days of making such correction, the Administrator will notify the NOx 

authorized account representative for the account.

41.9.8 Closing of general accounts.

(a) The NOx authorized account representative of a general account may

instruct the Administrator to close the account by submitting a statement 

requesting deletion of the account from the NOx Allowance Tracking 

System and by correctly submitting for recordation under subsection 

41.8.1 an allowance transfer of all NOx allowances in the account to one 

or more other NOx Allowance Tracking System accounts. 

(b) If a general account shows no activity for a period of a year or more and 

does not contain any NOx allowances, the Administrator may notify the 

NOx authorized account representative for the account that the account 

will be closed and deleted from the NOx Allowance Tracking System 

following 20 business days after the notice is sent. The account will be 

closed after the 20-day period unless before the end of the 20-day period 

the Administrator receives a correctly submitted transfer of NOx 

allowances into the account under subsection 41.8.1 or a statement 

submitted by the NOx authorized account representative demonstrating to 

the satisfaction of the Administrator good cause as to why the account 

should not be closed. 

41.10 Monitoring

41.10.1 Monitoring requirements.

(a) The owners and operators and, to the extent applicable, the NOx 
Page 38 of 66

authorized account representative of each NOx Budget source and each 

NOx Budget unit at the source shall comply with the monitoring 

requirements of this section and in subpart H of 40 CFR Part 75. For 

purposes of complying with such requirements, the definitions in section 

41.1 and in 40 CFR 72.2 shall apply, and the terms "affected unit", 

"designated representative", and "continuous emission monitoring 

system"(or "CEMS") in 40 CFR Part 75 shall be replaced by the terms 

"NOx Budget unit", "NOx authorized account representative", and 

"continuous emission monitoring system" (or "CEMS"), respectively, as 

defined in section 41.1.

(b) The emissions measurements recorded and reported in accordance with 

this section shall be used to determine compliance by the unit with the 

NOx Budget emissions limitation under subsection 41.4.1.

41.10.2 General Requirements.

(a) Requirements for installation, certification, and data accounting. The 

owner or operator of each NOx Budget unit must meet the following 

requirements. These provisions also apply to a unit for which an 

application for a NOx Budget opt-in permit is submitted and not denied or 

withdrawn, as provided in section 41.13:

(1) Install all monitoring systems required under this section for 

monitoring NOx mass. This includes all systems required to 

monitor NOx emission rate, NOx concentration, heat input, and 

flow, in accordance with 40 CFR Parts 75.71 and 75.72.

(2) Install all monitoring systems for monitoring heat input, if required 

under subsection 41.11.6 for developing NOx allowance 

allocations.

(3) Successfully complete all certification tests required under 

subsection 41.10.3 and meet all other provisions of this section and 

40 CFR Part 75 applicable to the monitoring systems under 

paragraphs (a)(1) and (2) of this subsection. 

(4) Record, and report data from the monitoring systems under 

paragraphs (a)(1) and (2) of this subsection.

(b) Compliance dates. The owner or operator must meet the requirements of 

paragraphs (a)(1) through (a)(3) of this section on or before the following 

dates and must record and report data on and after the following dates:

(1) NOx Budget units under section 41.3 that commence operation 
Page 39 of 66

before January 1, 2002, must comply with the requirements of this 

section by May 1, 2002. 

(3) NOx Budget units under section 41.3 that commence operation on 

or after January 1, 2002 and that report on an annual basis under 

subsection 41.11.4 must comply with the requirements of this 

section by the later of the following dates:

a. May 1, 2002; or

b. the earlier of:

(i) 180 days after the date on which the unit 

commences operation or, 

(ii) For units under paragraph 41.3.1(a), 90 days after 

the date on which the unit commences commercial 

operation.

(4) NOx Budget units under section 41.3 that commence operation on 

or after January 1, 2002 and that report on a control season basis 

under subsection 41.11.4 must comply with the requirements of 

this section by the later of the following dates:

a. the earlier of

(i) 180 days after the date on which the unit 

commences operation or, 

(ii) for units under paragraph 41.3.1(a), 90 days after 

the date on which the unit commences commercial 

operation.

b. However, if the applicable deadline under paragraph (b)(4) 

a. subsection does not occur during a control period, May 1; 

immediately following the date determined in accordance 

with paragraph (b)(4) a. of this subsection.

(5) For a NOx Budget unit with a new stack or flue for which 

construction is completed after the applicable deadline under 

paragraph (b)(1), (b)(2) or (b)(3) of this subsection or section 

41.13:

a. 90 days after the date on which emissions first exit to the 

atmosphere through the new stack or flue
Page 40 of 66

b. However, if the unit reports on a control season basis under 

subsection 41.11.4 and the applicable deadline under 

paragraph (b)(5) a. of this subsection does not occur during 

the control period, May 1 immediately following the 

applicable deadline in paragraph (b)(5) a. of this subsection.

(6) For a unit for which an application for a NOx Budget opt in permit 

is submitted and not denied or withdrawn, the compliance dates 

specified under section 41.13.

(c) Reporting data prior to initial certification.

(1) The owner or operator of a NOx Budget under paragraphs (b)(3) or 

(b)(4) of this subsection must determine, record and report NOx 

mass, heat input (if required for purposes of allocations) and any

other values required to determine NOx Mass (e.g. NOx emission 

rate and heat input or NOx concentration and stack flow) using the 

provisions of 40 CFR 75.70(g), from the date and hour that the unit 

starts operating until all required certification tests are successfully

completed.

(d) Prohibitions.

(1) No owner or operator of a NOx Budget unit or a non-NOx Budget 

unit monitored under 40 CFR 75.72(b)(2)(ii) shall use any

alternative monitoring system, alternative reference method, or any

other alternative for the required continuous emission monitoring 

system without having obtained prior written approval in 

accordance with subsection 41.11.5.

(2) No owner or operator of a NOx Budget unit or a non-NOx Budget 

unit monitored under 40 CFR 75.72(b)(2)(ii) shall operate the unit 

so as to discharge, or allow to be discharged, NOx emissions to the 

atmosphere without accounting for all such emissions in 

accordance with the applicable provisions of this section and 40 

CFR Part 75 except as provided for in 40 CFR 75.74.

(3) No owner or operator of a NOx Budget unit or a non-NOx Budget 

unit monitored under 40 CFR 75.72(b)(2)(ii) shall disrupt the 

continuous emission monitoring system, any portion thereof, or any

other approved emission monitoring method, and thereby avoid 

monitoring and recording NOx mass emissions discharged into the 

atmosphere, except for periods of recertification or periods when 

calibration, quality assurance testing, or maintenance is performed 
Page 41 of 66

in accordance with the applicable provisions of this section and 40 

CFR Part 75 except as provided for in 40 CFR 75.74.

(4) No owner or operator of a NOx Budget unit s or a non-NOx 

Budget unit monitored under 40 CFR 75.72(b)(2)(ii) shall retire or 

permanently discontinue use of the continuous emission 

monitoring system, any component thereof, or any other approved 

emission monitoring system under this section, except under any

one of the following circumstances:

a. During the period that the unit is covered by a retired unit 

exemption under section 41.14 that is in effect;

b. The owner or operator is monitoring emissions from the 

unit with another certified monitoring system approved, in 

accordance with the applicable provisions of this section 

and 40 CFR Part 75, by the Department, for use at that unit 

that provides emission data for the same pollutant or 

parameter as the retired or discontinued monitoring system; 

or

c. The NOx authorized account representative submits 

notification of the date of certification testing of a 

replacement monitoring system in accordance with 

subsection 41.10.3(b)(2).

41.10.3 Initial certification and recertification procedures

(a) The owner or operator of a NOx Budget unit that is subject to an Acid 

Rain emissions limitation shall comply with the initial certification and 

recertification procedures of 40 CFR Part 75, except that: 

(1) If, prior to January 1, 1998, the Administrator approved a petition 

under 40 CFR 75.17(a) or (b) for apportioning the NOx emission 

rate measured in a common stack or a petition under 40 CFR 75.66 

for an alternative to a requirement in 40 CFR 75.17, the NOx 

authorized account representative shall resubmit the petition to the 

Administrator under subsection 41.11.5(a) to determine if the 

approval applies under the NOx Budget Trading Program.

(2) For any additional CEMS required under the common stack 

provisions in 40 CFR 75.72, or for any NOx concentration CEMS 

used under the provisions of 40 CFR 75.71(a)(2), the owner or 

operator shall meet the requirements of paragraph (b) of this 

subsection.
Page 42 of 66

(b) The owner or operator of a NOx Budget unit that is not subject to an Acid 

Rain emissions limitation shall comply with the following initial 

certification and recertification procedures, except that the owner or 

operator of a unit that qualifies to use the low mass emissions excepted 

monitoring methodology under 40 CFR 75.19 shall also meet the 

requirements of paragraph (c) of this subsection and the owner or operator 

of a unit that qualifies to use an alternative monitoring system under 

subpart E of 40 CFR Part 75 shall also meet the requirements of paragraph 

(d) of this subsection. The owner or operator of a NOx Budget unit that is 

subject to an Acid Rain emissions limitation, but requires additional 

CEMS under the common stack provisions in 40 CFR 75.72, or that uses a 

NOx concentration CEMS under 40 CFR 75.71(a)(2) also shall comply

with the following initial certification and recertification procedures.

(1) Requirements for initial certification. The owner or operator shall 

ensure that each monitoring system required by subpart H of 40 

CFR Part 75 (which includes the automated data acquisition and 

handling system) successfully completes all of the initial 

certification testing required under 40 CFR 75.20. The owner or 

operator shall ensure that all applicable certification tests are 

successfully completed by the deadlines specified in subsection 

41.10.2(b). In addition, whenever the owner or operator installs a 

monitoring system in order to meet the requirements of this section 

in a location where no such monitoring system was previously

installed, initial certification according to 40 CFR 75.20 is 

required.

(2) Requirements for recertification. Whenever the owner or operator 

makes a replacement, modification, or change in a certified 

monitoring system that the Administrator or the Department 

determines significantly affects the ability of the system to 

accurately measure or record NOx mass emissions or heat input or 

to meet the requirements of 40 CFR 75.21 or appendix B to 40 

CFR Part 75, the owner or operator shall recertify the monitoring 

system according to 40 CFR 75.20(b). Furthermore, whenever the 

owner or operator makes a replacement, modification, or change to 

the flue gas handling system or the unit's operation that the 

Administrator or the Department determines to significantly

change the flow or concentration profile, the owner or operator 

shall recertify the continuous emissions monitoring system 

according to 40 CFR 75.20(b). Examples of changes which require 

recertification include: replacement of the analyzer, change in 

location or orientation of the sampling probe or site, or changing of 

flow rate monitor polynomial coefficients. 
Page 43 of 66

(3) Certification approval process for initial certifications and 

recertification.

a. Notification of certification. The NOx authorized account 

representative shall submit to the Department, the 

appropriate EPA Regional Office and the Administrator a 

written notice of the dates of certification in accordance 

with subsection 41.10.5. 

b. Certification application. The NOx authorized account 

representative shall submit to the Department a certification 

application for each monitoring system required under 

subpart H of 40 CFR Part 75. A complete certification 

application shall include the information specified in 

subpart H of 40 CFR Part 75.

c. Except for units using the low mass emission excepted 

methodology under 40 CFR 75.19, the provisional 

certification date for a monitor shall be determined using 

the procedures set forth in 40 CFR 75.20(a)(3). A 

provisionally certified monitor may be used under the NOx 

Budget Trading Program for a period not to exceed 120 

days after receipt by the Department of the complete

certification application for the monitoring system or 

component thereof under paragraph (b)(3) b. of this 

subsection. Data measured and recorded by the 

provisionally certified monitoring system or component 

thereof, in accordance with the requirements of 40 CFR 

Part 75, will be considered valid quality-assured data 

(retroactive to the date and time of provisional 

certification), provided that the Department does not 

invalidate the provisional certification by issuing a notice of 

disapproval within 120 days of receipt of the complete 

certification application by the Department. 

d. Certification application formal approval process. The 

Department will issue a written notice of approval or 

disapproval of the certification application to the owner or 

operator within 120 days of receipt of the complete 

certification application under paragraph (b)(3) b. of this 

subsection. In the event the Department does not issue 

such a notice within such 120-day period, each monitoring 

system which meets the applicable performance 

requirements of 40 CFR Part 75 and is included in the 
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certification application will be deemed certified for use 

under the NOx Budget Trading Program.

(i) Approval notice. If the certification application is 

complete and shows that each monitoring system 

meets the applicable performance requirements of 

40 CFR Part 75, then the Department will issue a 

written notice of approval of the certification 

application within 120 days of receipt.

(ii) Incomplete application notice. A certification 

application will be considered complete when all of 

the applicable information required to be submitted 

under paragraph (b)(3) b. of this subsection has 

been received by the Department. If the 

certification application is not complete, then the 

Department will issue a written notice of 

incompleteness that sets a reasonable date by which 

the NOx authorized account representative must 

submit the additional information required to 

complete the certification application. If the NOx 

authorized account representative does not comply

with the notice of incompleteness by the specified 

date, then the Department may issue a notice of 

disapproval under paragraph (b)(3) d. (iii) of this 

subsection. 

(iii) Disapproval notice. If the certification application 

shows that any monitoring system or component 

thereof does not meet the performance requirements 

of this regulation, or if the certification application 

is incomplete and the requirement for disapproval 

under paragraph (b)(3) d. (ii) of this subsection has 

been met, the Department will issue a written notice 

of disapproval of the certification application. 

Upon issuance of such notice of disapproval, the 

provisional certification is invalidated by the 

Department and the data measured and recorded by

each uncertified monitoring system or component 

thereof shall not be considered valid quality-assured 

data beginning with the date and hour of provisional 

certification. The owner or operator shall follow the 

procedures for loss of certification in paragraph

(b)(3) e. of this subsection for each monitoring 

system or component thereof which is disapproved 
Page 45 of 66

for initial certification. 

(iv) Audit decertification. The Department may issue a 

notice of disapproval of the certification status of a 

monitor in accordance with subsection 41.10.4(b).

e. Procedures for loss of certification. If the Department 

issues a notice of disapproval of a certification application 

under paragraph (b)(3) d. (iii) of this subsection or a notice 

of disapproval of certification status under paragraph (b)(3) 

d. (iv) of this subsection, then: 

(i) The owner or operator shall substitute the following 

values, for each hour of unit operation during the 

period of invalid data beginning with the date and 

hour of provisional certification and continuing 

until the time, date, and hour specified under 40 

CFR 75.20(a)(5)(i): 

(A) For units using or intending to monitor for 

NOx emission rate and heat input or for 

units using the low mass emission excepted 

methodology under 40 CFR 75.19, the 

maximum potential NOx emission rate and 

the maximum potential hourly heat input of 

the unit. 

(B) For units intending to monitor for NOx mass 

emissions using a NOx pollutant 

concentration monitor and a flow monitor, 

the maximum potential concentration of 

NOx and the maximum potential flow rate 

of the unit under section 2.1 of appendix A 

of 40 CFR Part 75; 

(ii) The NOx authorized account representative shall 

submit a notification of certification retest dates and 

a new certification application in accordance with 

paragraphs (b)(3) a. and b. of this subsection; and 

(iii) The owner or operator shall repeat all certification 

tests or other requirements that were failed by the 

monitoring system, as indicated in the Department's

notice of disapproval, no later than 30 unit operating 

days after the date of issuance of the notice of 
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disapproval.

(c) Initial certification and recertification procedures for low mass emission 

units using the excepted methodologies under 40 CFR 75.19. The owner 

or operator of a gas-fired or oil-fired unit using the low mass emissions 

excepted methodology under 40 CFR 75.19 shall meet the applicable 

general operating requirements of 40 CFR 75.10, the applicable 

requirements of 40 CFR 75.19, and the applicable certification 

requirements of subsection 41.10.3, except that the excepted methodology

shall be deemed provisionally certified for use under the NOx Budget 

Trading Program, as of the following dates:

(1) For units that are reporting on an annual basis under subsection 

41.11.4(b)(1):

a. For a unit that has commences operation before its 

compliance deadline under subsection 41.10.3(b), from 

January 1 of the year following submission of the 

certification application for approval to use the low mass 

emissions excepted methodology under 40 CFR 75.19 until 

the completion of the period for the Department review; or

b. For a unit that commences operation after its compliance 

deadline under subsection 41.10.3(b), the date of 

submission of the certification application for approval to 

use the low mass emissions excepted methodology under 

40 CFR 75.19 until the completion of the period for 

Department review, or 

(2) For units that are reporting on a control period basis under 

subsection 41.11.4(b)(2): 

a. For a unit that commenced operation before its compliance 

deadline under subsection 41.10.3(b), where the 

certification application is submitted before May 1, from 

May 1 of the year of the submission of the certification 

application for approval to use the low mass emissions 

excepted methodology under 40 CFR 75.19 until the 

completion of the period for the Department review; or

b. For a unit that commenced operation before its compliance 

deadline under subsection 41.10.3(b), where the 

certification application is submitted after May 1, from May

1 of the year following submission of the certification 

application for approval to use the low mass emissions 
Page 47 of 66

excepted methodology under 40 CFR 75.19 until the 

completion of the period for the Department review; or

c. For a unit that commences operation after its compliance 

deadline under subsection 41.10.3(b), where the unit 

commences operation before May 1, from May 1 of the 

year that the unit commenced operation, until the 

completion of the period for the Department's review.

d. For a unit that has not operated after its compliance 

deadline under subsection 41.10.3(b), where the 

certification application is submitted after May 1, but 

before October 1st, from the date of submission of a 

certification application for approval to use the low mass 

emissions excepted methodology under 40 CFR 75.19 until 

the completion of the period for the Department's review.

(d) Certification/recertification procedures for alternative monitoring systems. 

The NOx authorized account representative representing the owner or 

operator of each unit applying to monitor using an alternative monitoring 

system approved by the Administrator and, if applicable, the Department 

under subpart E of 40 CFR Part 75 shall apply for certification to the 

Department prior to use of the system under the NOx Trading Program. 

The NOx authorized account representative shall apply for recertification 

following a replacement, modification or change according to the 

procedures in paragraph (b) of this subsection. The owner or operator of 

an alternative monitoring system shall comply with the notification and 

application requirements for certification according to the procedures 

specified in paragraph (b)(3) of this subsection and 40 CFR 75.20(f). 

41.10.4 Out of control periods.

(a) Whenever any monitoring system fails to meet the quality assurance 

requirements of appendix B of 40 CFR Part 75, data shall be substituted 

using the applicable procedures in subpart D, appendix D, or appendix E 

of 40 CFR Part 75.

(b) Audit decertification. Whenever both an audit of a monitoring system and 

a review of the initial certification or recertification application reveal that 

any system or component should not have been certified or recertified 

because it did not meet a particular performance specification or other 

requirement under subsection 41.10.3 or the applicable provisions of 40 

CFR Part 75, both at the time of the initial certification or recertification 

application submission and at the time of the audit, the Department will 

issue a notice of disapproval of the certification status of such system or 
Page 48 of 66

component. For the purposes of this paragraph, an audit shall be either a 

field audit or an audit of any information submitted to the Department or 

the Administrator. By issuing the notice of disapproval, the Department 

revokes prospectively the certification status of the system or component. 

The data measured and recorded by the system or component shall not be 

considered valid quality-assured data from the date of issuance of the 

notification of the revoked certification status until the date and time that 

the owner or operator completes subsequently approved initial certification 

or recertification tests. The owner or operator shall follow the initial 

certification or recertification procedures in subsection 41.10.3 for each 

disapproved system. 

41.10.5 Notifications.

The NOx authorized account representative for a NOx Budget unit shall 

submit written notice to the Department and the Administrator in 

accordance with 40 CFR 75.61, except that if the unit is not subject to an 

Acid Rain emissions limitation, the notification is only required to be sent 

to the Department.

41.11 Recordkeeping and reporting.

41.11.1 General provisions

(a) The NOx authorized account representative shall comply with all 

recordkeeping and reporting requirements in this section and with the 

requirements of subsection 41.6.1(e).

(b) If the NOx authorized account representative for a NOx Budget unit 

subject to an Acid Rain Emission limitation who signed and certified any

submission that is made under subpart F or G of 40 CFR Part 75 and 

which includes data and information required under this section, section 

41.10 or subpart H of 40 CFR Part 75 is not the same person as the 

designated representative or the alternative designated representative for 

the unit under 40 CFR Part 72, the submission must also be signed by the 

designated representative or the alternative designated representative. 

41.11.2 Monitoring Plans. 

(a) The owner or operator of a unit subject to an Acid Rain emissions 

limitation shall comply with requirements of 40 CFR 75.62, except that 

the monitoring plan shall also include all of the information required by

subpart H of 40 CFR Part 75.
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(b) The owner or operator of a unit that is not subject to an Acid Rain 

emissions limitation shall comply with requirements of 40 CFR 75.62, 

except that the monitoring plan is only required to include the information 

required by subpart H of 40 CFR Part 75.

41.11.3 Certification Applications.

(a) The NOx authorized account representative shall submit an application to 

the Department within 45 days after completing all initial certification or 

recertification tests required under subsection 41.10.3 including the 

information required under subpart H of 40 CFR Part 75.

41.11.4 Quarterly reports.

The NOx authorized account representative shall submit quarterly reports, as 

follows: 

(a) If a unit is subject to an Acid Rain emission limitation or if the owner or 

operator of the NOx budget unit chooses to meet the annual reporting 

requirements of this section, the NOx authorized account representative 

shall submit a quarterly report for each calendar quarter beginning with:

(1) For units commencing operation prior to May 1, 2002, the earlier 

of the calendar quarter that includes the date of initial provisional 

certification under subsection 41.10.3(b)(3) c or, if the certification 

tests are not completed by May 1, 2002, the partial calendar quarter 

from May 1, 2002 through June 30, 2002. Data shall be recorded 

and reported from the earlier of the date and hour corresponding to 

the date and hour of provisional certification or the first hour on 

May 1, 2002; or

(2) For a unit that commences operation after May 1, 2002, the 

calendar quarter in which the unit commences operation. Data shall 

be reported from the date and hour corresponding to when the unit 

commenced operation.

(b) If a NOx budget unit is not subject to an Acid Rain emission limitation, 

then the NOx authorized account representative shall either:

(1) Meet all of the requirements of 40 CFR Part 75 related to 

monitoring and reporting NOx mass emissions during the entire 

year and meet the reporting deadlines specified in paragraph (a) of 

this subsection; or

(2) submit quarterly reports only for the periods from the earlier of 
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May 1 or the date and hour that the owner or operator successfully

completes all of the recertification tests required under 40 CFR 

75.74(d)(3) through September 30 of each year in accordance with 

the provisions of 40 CFR 75.74(b). The NOx authorized account 

representative shall submit a quarterly report for each calendar 

quarter, beginning with:

a. For units commencing operation prior to May 1, 2002, the 

earlier of the calendar quarter that includes the date of 

initial provisional certification under subsection 

41.10.3(b)(3) c, or if the certification tests are not 

completed by May 1, 2002, the partial calendar quarter 

from May 1, 2002 through June 30, 2002. Data shall be 

reported from the earlier of the date and hour corresponding 

to the date and hour of provisional certification or the first 

hour of May 1, 2002; or

b. For units that commence operation after May 1, 2002 

during the control period, the calendar quarter in which the 

unit commences operation. Data shall be reported from 

the date and hour corresponding to when the unit 

commenced operation; or

c. For units that commence operation after May 1, 2002 and 

before May 1 of the year in which the unit commences 

operation, the earlier of the calendar quarter that includes 

the date of initial provisional certification under subsection 

41.10.3(b)(3) c or, if the certification tests are not 

completed by May 1 of the year in which the unit 

commences operation, May 1 of the year in which the unit 

commences operation. Data shall be reported from the 

earlier of the date and hour corresponding to the date and 

hour of provisional certification or the first hour of May 1 

of the year after the unit commences operation.

d. For units that commence operation after May 1, 2002 and 

after September 30 of the year in which the unit 

commences operation, the earlier of the calendar quarter 

that includes the date of initial provisional certification 

under subsection 41.10.3(b)(3) c or, if the certification tests 

are not completed by May 1 of the year after the unit 

commences operation, May 1 of the year after the unit 

commences operation. Data shall be reported from the 

earlier of the date and hour corresponding to the date and 

hour of provisional certification or the first hour of May 1 
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of the year after the unit commences operation.

(c) The NOx authorized account representative shall submit each quarterly

report to the Administrator within 30 days following the end of the 

calendar quarter covered by the report. Quarterly reports shall be 

submitted in the manner specified in subpart H of 40 CFR Part 75 and 40 

CFR 75.64.

(1) For units subject to an Acid Rain Emissions limitation, quarterly

reports shall include all of the data and information required in 

subpart H of 40 CFR Part 75 for each NOx Budget unit (or group 

of units using a common stack) as well as information required in 

subpart G of 40 CFR Part 75. 

(2) For units not subject to an Acid Rain Emissions limitation, 

quarterly reports are only required to include all of the data and 

information required in subpart H of 40 CFR Part 75 for each NOx 

Budget unit (or group of units using a common stack). 

(d) Compliance certification. The NOx authorized account representative 

shall submit to the Administrator a compliance certification in support of 

each quarterly report based on reasonable inquiry of those persons with 

primary responsibility for ensuring that all of the unit's emissions are 

correctly and fully monitored. The certification shall state that: 

(1) The monitoring data submitted were recorded in accordance with 

the applicable requirements of this section, section 41.10 and 40 

CFR Part 75, including the quality assurance procedures and 

specifications; and

(2) For a unit with add-on NOx emission controls and for all hours 

where data are substituted in accordance with 40 CFR 75.34(a)(1), 

the add-on emission controls were operating within the range of 

parameters listed in the monitoring plan and the substitute values 

do not systematically underestimate NOx emissions; and

(3) For a unit that is reporting on a control period basis under 

subsection 41.11.4 the NOx emission rate and NOx concentration 

values substituted for missing data under subpart D of 40 CFR Part 

75 are calculated using only values from a control period and do 

not systematically underestimate NOx emissions.

41.11.5 Petitions 

(a) The NOx authorized account representative of a NOx Budget unit that is 
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subject to an Acid Rain emissions limitation may submit a petition under 

40 CFR 75.66 to the Administrator requesting approval to apply an 

alternative to any requirement of this section and section 41.10. 

(1) Application of an alternative to any requirement of this section or 

section 41.10 is in accordance with the section only to the extent 

that the petition is approved by the Administrator, in consultation 

with the Department.

(2) Notwithstanding paragraph (a)(1) of this subsection, if the petition 

requests approval to apply an alternative to a requirement 

concerning any additional CEMS required under the common stack 

provisions of 40 CFR 75.72, the petition is governed by paragraph 

(b) of this subsection. 

(b) The NOx authorized account representative of a NOx Budget unit that is 

not subject to an Acid Rain emissions limitation may submit a petition 

under 40 CFR 75.66 to the Department and the Administrator requesting 

approval to apply an alternative to any requirement of this section and 

section 41.10. 

(1) The NOx authorized account representative of a NOx Budget unit 

that is subject to an Acid Rain emissions limitation may submit a 

petition under 40 CFR 75.66 to the Department and the 

Administrator requesting approval to apply an alternative to a 

requirement concerning any additional CEMS required under the 

common stack provisions of 40 CFR 75.72 or a NOx concentration 

CEMS used under 40 CFR 75.71(a)(2).

(2) Application of an alternative to any requirement of this section or 

section 41.10 is in accordance with the section only to the extent 

the petition under paragraph (b) of this subsection is approved by

both the Department and the Administrator. 

41.12 Compliance Certification

41.12.1 Compliance certification report.

(a) Applicability and deadline. For each control period in which one or more 

NOx Budget units at a source are subject to the NOx Budget emissions 

limitation, the NOx authorized account representative of the source shall 

submit to the Department and the Administrator by November 30 of that 

year, a compliance certification report for each source covering all such 

units.
Page 53 of 66

(b) Contents of report. The NOx authorized account representative shall 

include in the compliance certification report under paragraph (a) of this 

subsection the following elements, in a format prescribed by the 

Administrator, concerning each unit at the source and subject to the NOx 

Budget emissions limitation for the control period covered by the report:

(1) Identification of each NOx Budget unit;

(2) At the NOx authorized account representative's option, the serial 

numbers of the NOx allowances that are to be deducted from each 

unit's compliance account under subsection 41.9.5 for the control 

period;

(3) At the NOx authorized account representative's option, for units

sharing a common stack and having NOx emissions that are not 

monitored separately or apportioned in accordance with section 

41.10, the percentage of allowances that is to be deducted from 

each unit's compliance account under subsection 41.9.5(e); and

(4) The compliance certification under paragraph (c) of this 

subsection.

(c) Compliance certification. In the compliance certification report under 

paragraph (a) of this subsection, the NOx authorized account 

representative shall certify, based on reasonable inquiry of those persons 

with primary responsibility for operating the source and the NOx Budget 

units at the source in compliance with the NOx Budget Trading Program, 

whether each NOx Budget unit for which the compliance certification is 

submitted was operated during the calendar year covered by the report in 

compliance with the requirements of the NOx Budget Trading Program 

applicable to the unit, including:

(1) Whether the unit was operated in compliance with the NOx Budget 

emissions limitation;

(2) Whether the monitoring plan that governs the unit has been 

maintained to reflect the actual operation and monitoring of the 

unit, and contains all information necessary to attribute NOx 

emissions to the unit, in accordance with sections 41.10 and 41.11;

(3) Whether all the NOx emissions from the unit, or a group of units 

(including the unit) using a common stack, were monitored or 

accounted for through the missing data procedures and reported in 

the quarterly monitoring reports, including whether conditional 
Page 54 of 66

data were reported in the quarterly reports in accordance with 

sections 41.10 and 41.11. If conditional data were reported, the 

owner or operator shall indicate whether the status of all 

conditional data has been resolved and all necessary quarterly

report resubmissions has been made;

(4) Whether the facts that form the basis for certification under section 

41.10 and 41.11 of each monitor at the unit or a group of units 

(including the unit) using a common stack, or for using an excepted

monitoring method or alternative monitoring method approved 

under section 41.10 and 41.11, if any, has changed; and

(5) If a change is required to be reported under paragraph (c)(4) of this 

subsection, specify the nature of the change, the reason for the 

change, when the change occurred, and how the unit's compliance 

status was determined subsequent to the change, including what 

method was used to determine emissions when a change mandated 

the need for monitor recertification.

41.12.2 Department's and Administrator's action on compliance certifications.

(a) The Department or the Administrator may review and conduct 

independent audits concerning any compliance certification or any other 

submission under the NOx Budget Trading Program and make appropriate

adjustments of the information in the compliance certifications or other 

submissions.

(b) The Administrator may deduct NOx allowances from or transfer NOx 

allowances to a unit's compliance account or a source's overdraft account 

based on the information in the compliance certifications or other 

submissions, as adjusted under paragraph (a) of this subsection.

41.13 Individual Opt-ins.

41.13.1 Applicability.

A unit that is in the State, is not a NOx Budget unit under section 41.3, 

vents all of its emissions to a stack, and is operating, may qualify, under 

this section, to become a NOx Budget opt-in source. A unit that is a NOx 

Budget unit, is covered by a retired unit exemption under section 41.14 

that is in effect, or is not operating is not eligible to become a NOx Budget 

opt-in source.

41.13.2 General.
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Except otherwise as provided in this regulation, a NOx Budget opt-in 

source shall be treated as a NOx Budget unit for purposes of applying 

sections 41.1 through 41.12 of this regulation.

41.13.3 NOx authorized account representative.

A unit for which an application for a NOx Budget opt-in permit is 

submitted and not denied or withdrawn, or a NOx Budget opt-in source, 

located at the same source as one or more NOx Budget units, shall have 

the same NOx authorized account representative as such NOx Budget 

units.

41.13.4 Applying for NOx Budget opt-in permit.

(a) Applying for initial NOx Budget opt-in permit. In order to apply for an 

initial NOx Budget opt-in permit, the NOx authorized account 

representative of a unit qualified under subsection 41.13.1 may submit to 

the Department at any time, except as provided under subsection 

41.13.7(g):

(1) A complete NOx Budget permit application under subsection 

41.7.4;

(2) A monitoring plan submitted in accordance with section 41.10; and

(3) A complete account certificate of representation under subsection 

41.6.5, if no NOx authorized account representative has been 

previously designated for the unit.

(b) Duty to reapply. The NOx authorized account representative of a NOx 

Budget opt-in source shall submit a complete NOx Budget permit 

application under subsection 41.7.4 to renew the NOx Budget opt-in 

permit in accordance with subsection 41.7.3(c) and, if applicable, an 

updated monitoring plan in accordance with section 41.10.

41.13.5 Opt-in process.

The Department will issue or deny a NOx Budget opt-in permit for a unit for 

which an initial application for a NOx Budget opt-in permit under subsection 

41.13.4 is submitted, in accordance with subsection 41.7.2 and the following: 

(a) Interim review of monitoring plan. The Department will determine, on an 

interim basis, the sufficiency of the monitoring plan accompanying the 

initial application for a NOx Budget opt-in permit under subsection 
Page 56 of 66

41.13.4. A monitoring plan is sufficient, for purposes of interim review, if 

the plan appears to contain information demonstrating that the NOx 

emissions rate and heat input of the unit are monitored and reported in 

accordance with sections 41.10 and 41.11. A determination of sufficiency

shall not be construed as acceptance or approval of the unit's monitoring 

plan.

(b) If the Department determines that the unit's monitoring plan is sufficient 

under paragraph (a) of this subsection and after completion of monitoring 

system certification under section 41.10, the NOx emissions rate and the 

heat input of the unit shall be monitored and reported in accordance with 

section 41.10 for one full control period during which monitoring system 

availability is not less than 90 percent and during which the unit is in full 

compliance with any applicable State or Federal emissions or emissionsrelated requirements. Solely for purposes of applying the requirements in 

the prior sentence, the unit shall be treated as a "NOx Budget unit" prior to 

issuance of a NOx Budget opt-in permit covering the unit.

(c) Based on the information monitored and reported under paragraph (b) of 

this subsection, the unit's baseline heat rate shall be calculated as the unit's 

total heat input (in mmBtu) for the control period and the unit's baseline 

NOx emissions rate shall be calculated as the unit's total NOx mass 

emissions (in lb) for the control period divided by the unit's baseline heat 

rate. 

(d) After calculating the baseline heat input and the baseline NOx emissions 

rate for the unit under paragraph (c) of this subsection, the Department 

will serve a draft NOx Budget opt-in permit on the NOx authorized 

account representative of the unit.

(e) Confirmation of intention to opt-in. Within 20 days after the issuance of 

the draft NOx Budget opt-in permit, the NOx authorized account 

representative of the unit must submit to the Department a confirmation of 

the intention to opt in the unit or a withdrawal of the application for a NOx 

Budget opt-in permit under subsection 41.13.4. The Department will treat 

the failure to make a timely submission as a withdrawal of the NOx 

Budget opt-in permit application.

(f) Issuance of draft NOx Budget opt-in permit. If the NOx authorized 

account representative confirms the intention to opt in the unit under 

paragraph (e) of this subsection, the Department will issue the draft NOx 

Budget opt-in permit in accordance with subsection 41.7.2.

(g) Not withstanding paragraphs (a) through (f) of this subsection, if at any

time before issuance of a draft NOx Budget opt-in permit for the unit, the 
Page 57 of 66

Department determines that the unit does not qualify as a NOx Budget optin source under subsection 41.13.1, the Department will issue a draft 

denial of a NOx Budget opt-in permit for the unit in accordance with 

subsection 41.7.2.

(h) Withdrawal of application for NOx Budget opt-in permit. A NOx 

authorized account representative of a unit may withdraw its application 

for a NOx Budget opt-in permit under subsection 41.13.4 at any time prior 

to the issuance of the final NOx Budget opt-in permit. Once the 

application for a NOx Budget opt-in permit is withdrawn, a NOx 

authorized account representative wanting to reapply must submit a new 

application for a NOx Budget permit under subsection 41.13.4. 

(i) Effective date. The effective date of the initial NOx Budget opt-in permit 

shall be May 1 of the first control period starting after the issuance of the 

initial NOx Budget opt-in permit by the Department. The unit shall be a

NOx Budget opt-in source and a NOx Budget unit as of the effective date 

of the initial NOx Budget opt-in permit.

41.13.6 NOx Budget opt-in permit contents.

(a) Each NOx Budget opt-in permit (including any draft or proposed NOx 

Budget opt-in permit, if applicable) will contain all elements required for a 

complete NOx Budget opt-in permit application under subsection 41.7.3 as 

approved or adjusted by the Department.

(b) Each NOx Budget opt-in permit is deemed to incorporate automatically

the definitions of terms under subsection 41.1 and, upon recordation by the 

Administrator under sections 41. 8, 41.9 and 41.13, every allocation, 

transfer, or deduction of NOx allowances to or from the compliance 

accounts of each NOx Budget opt-in source covered by the NOx Budget 

opt-in permit or the overdraft account of the NOx Budget source where the 

NOx Budget opt-in source is located. 

41.13.7 Withdrawal from NOx Budget Trading Program.

(a) Requesting withdrawal. To withdraw from the NOx Budget Trading 

Program, the NOx authorized account representative of a NOx Budget 

opt-in source shall submit to the Department a request to withdraw 

effective as of a specified date prior to May 1 or after September 30. The 

submission shall be made no later than 90 days prior to the requested 

effective date of withdrawal.

(b) Conditions for withdrawal. Before a NOx Budget opt-in source covered 

by a request under paragraph (a) of this subsection may withdraw from the 
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NOx Budget Trading Program and the NOx Budget opt-in permit may be 

terminated under paragraph (e) of this subsection, the following conditions 

must be met:

(1) For the control period immediately before the withdrawal is to be 

effective, the NOx authorized account representative must submit 

or must have submitted to the Department an annual compliance 

certification report in accordance with subsection 41.12.1.

(2) If the NOx Budget opt-in source has excess emissions for the 

control period immediately before the withdrawal is to be effective, 

the Administrator will deduct or has deducted from the NOx 

Budget opt-in source's compliance account, or the overdraft 

account of the NOx Budget source where the NOx Budget opt-in 

source is located, the full amount required under subsection 

41.9.5(d) for the control period.

(3) After the requirements for withdrawal under paragraphs (b)(1) and 

(2) of this subsection are met, the Administrator will deduct from 

the NOx Budget opt-in source's compliance account, or the 

overdraft account of the NOx Budget source where the NOx 

Budget opt-in source is located, NOx allowances equal in number 

to and allocated for the same or a prior control period as any NOx 

allowances allocated to that source under subsection 41.13.9 for 

any control period for which the withdrawal is to be effective. The 

Administrator will close the NOx Budget opt-in source's 

compliance account and will establish, and transfer any remaining 

allowances to, a new general account for the owners and operators 

of the NOx Budget opt-in source. The NOx authorized account 

representative for the NOx Budget opt-in source shall become the 

NOx authorized account representative for the general account. 

(c) A NOx Budget opt-in source that withdraws from the NOx Budget 

Trading Program shall comply with all requirements under the NOx 

Budget Trading Program concerning all years for which such NOx Budget 

opt-in source was a NOx Budget opt-in source, even if such requirements 

arise or must be complied with after the withdrawal takes effect.

(d) Notification.

(1) After the requirements for withdrawal under paragraphs (a) and (b) 

of this subsection are met (including deduction of the full amount 

of NOx allowances required), the Department will issue a 

notification to the NOx authorized account representative of the 

NOx Budget opt-in source of the acceptance of the withdrawal of 
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the NOx Budget opt-in source as of a specified effective date that 

is after such requirements have been met and that is prior to May 1 

or after September 30.

(2) If the requirements for withdrawal under paragraphs (a) and (b) of 

this subsection are not met, the Department will issue a notification 

to the NOx authorized account representative of the NOx Budget 

opt-in source that the NOx Budget opt-in source's request to 

withdraw is denied. If the NOx Budget opt-in source's request to 

withdraw is denied, the NOx Budget opt-in source shall remain 

subject to the requirements for a NOx Budget opt-in source.

(e) Permit amendment. After the Department issues a notification under 

paragraph (d)(1) of this subsection that the requirements for withdrawal 

have been met, the Department will revise the NOx Budget permit 

covering the NOx Budget opt-in source to terminate the NOx Budget 

opt-in permit as of the effective date specified under paragraph (d)(1) of 

this subsection. A NOx Budget opt-in source shall continue to be a NOx 

Budget opt-in source until the effective date of the termination.

(f) Reapplication upon failure to meet conditions of withdrawal. If the 

Department denies the NOx Budget opt-in source's request to withdraw, 

the NOx authorized account representative may submit another request to 

withdraw in accordance with paragraphs (a) and (b) of this subsection.

(g) Ability to return to the NOx Budget Trading Program. Once a NOx 

Budget opt-in source withdraws from the NOx Budget Trading Program 

and its NOx Budget opt-in permit is terminated under this section, the 

NOx authority account representative may not submit another application 

for a NOx Budget opt-in permit under subsection 41.13.4 for the unit prior 

to the date that is 4 years after the date on which the terminated NOx 

Budget opt-in permit became effective.

41.13.8 Change in regulatory status.

(a) Notification. When a NOx Budget opt-in source becomes a NOx Budget 

unit under section 41.3, the NOx authorized account representative shall 

notify in writing the Department and the Administrator of such change in 

the NOx Budget opt-in source's regulatory status, within 30 days of such 

change.

(b) Department's and Administrator's action. 

(1) When the NOx Budget opt-in source becomes a NOx Budget unit 

under section 41.3, the Department will revise the NOx Budget 

opt-in source's NOx Budget opt-in permit to meet the requirements 
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of a NOx Budget permit under subsection 41.7.5 as of an effective 

date that is the date on which such NOx Budget opt-in source 

becomes a NOx Budget unit under section 41.3. 

(2) The Administrator will deduct from the compliance account for the 

NOx Budget unit under paragraph (b)(1) of this subsection, or the 

overdraft account of the NOx Budget source where the unit is 

located, NOx allowances equal in number to and allocated for the 

same or a prior control period as:

a. Any NOx allowances allocated to the NOx Budget unit (as 

a NOx Budget opt-in source) under subsection 41.13.9 for 

any control period after the last control period during which 

the unit's NOx Budget opt-in permit was effective; and

b. If the effective date of the NOx Budget permit revision 

under paragraph (b)(1) of this subsection is during a control 

period, the NOx allowances allocated to the NOx Budget 

unit (as a NOx Budget opt-in source) under subsection 

41.13.9 for the control period multiplied by the ratio of the 

number of days, in the control period, starting with the 

effective date of the permit revision under paragraph (b)(1) 

of this subsection, divided by the total number of days in 

the control period.

(3) The NOx authorized account representative shall ensure that the 

compliance account of the NOx Budget unit under paragraph (b)(1) 

of this section, or the overdraft account of the NOx Budget source 

where the unit is located, includes the NOx allowances necessary

for completion of the deduction under paragraph (b)(2) of this 

subsection. If the compliance account or overdraft account does 

not contain sufficient NOx allowances, the Administrator will 

deduct the required number of NOx allowances, regardless of the 

control period for which they were allocated, whenever NOx 

allowances are recorded in either account.

(4) For every control period during which the NOx Budget permit 

revised under paragraph (b)(1) of this subsection is effective, the 

NOx Budget unit under paragraph (b)(1) of this subsection will be 

treated, solely for purposes of NOx allowance allocations under 

section 41.5, as a unit that commenced operation on the effective 

date of the NOx Budget permit revision under paragraph (b)(1) of 

this subsection and will be allocated NOx allowances under 

subsection 41.5. 
Page 61 of 66

(5) Notwithstanding paragraph (b)(4) of this subsection, if the 

effective date of the NOx Budget permit revision under paragraph 

(b)(1) of this subsection is during a control period, the following 

number of NOx allowances will be allocated to the NOx Budget 

unit under paragraph (b)(1) of this subsection under section 41.5 

for the control period: the number of NOx allowances otherwise 

allocated to the NOx Budget unit under section 41.5 for the control 

period multiplied by the ratio of the number of days, in the control 

period, starting with the effective date of the permit revision under 

paragraph (b)(1) of this subsection, divided by the total number of 

days in the control period.

(6) When the NOx authorized account representative of a NOx Budget 

opt-in source does not renew its NOx Budget opt-in permit under 

subsection 41.13.4(b), the Administrator will deduct from the NOx 

Budget opt-in unit's compliance account, or the overdraft account 

of the NOx Budget source where the NOx Budget opt-in source is 

located, NOx allowances equal in number to and allocated for the 

same or a prior control period as any NOx allowances allocated to 

the NOx Budget opt-in source under subsection 41.13.9 for any

control period after the last control period for which the NOx 

Budget opt-in permit is effective. The NOx authorized account 

representative shall ensure that the NOx Budget opt-in source's 

compliance account or the overdraft account of the NOx Budget 

source where the NOx Budget opt-in source is located includes the 

NOx allowances necessary for completion of such deduction. If 

the compliance account or overdraft account does not contain 

sufficient NOx allowances, the Administrator will deduct the 

required number of NOx allowances, regardless of the control 

period for which they were allocated, whenever NOx allowances 

are recorded in either account. 

(7) After the deduction under paragraph (b)(6) of this subsection is 

completed, the Administrator will close the NOx Budget opt-in 

source's compliance account. If any NOx allowances remain in the 

compliance account after completion of such deduction and any

deduction under subsection 41.9.5, the Administrator will close the 

NOx Budget opt-in source's compliance account and will establish, 

and transfer any remaining allowances to, a new general account 

for the owners and operators of the NOx Budget opt-in source. 

The NOx authorized account representative for the NOx Budget 

opt-in source shall become the NOx authorized account 

representative for the general account. 

41.13.9 NOx allowance allocations to opt-in units.
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(a) NOx allowance allocation.

(1) By December 31 immediately before the first control period for 

which the NOx Budget opt-in permit is effective, the Department 

will allocate NOx allowances to the NOx Budget opt-in source and 

submit to the Administrator the allocation for the control period in 

accordance with paragraph (b) of this subsection.

(2) By no later than December 31, after the first control period for 

which the NOx Budget opt-in permit is in effect, and December 31 

of each year thereafter, the Department will allocate NOx 

allowances to the NOx Budget opt-in source, and submit to the 

Administrator allocations for the next control period, in accordance 

with paragraph (b) of this subsection.

(b) For each control period for which the NOx Budget opt-in source has an 

approved NOx Budget opt-in permit, the NOx Budget opt-in source will 

be allocated NOx allowances in accordance with the following procedures:

(1) The heat input (in mmBtu) used for calculating NOx allowance 

allocations will be the lesser of:

a. The NOx Budget opt-in source's baseline heat input 

determined pursuant to subsection 41.13.5(c); or 

b. The NOx Budget opt-in source's heat input, as determined 

in accordance with section 41.10, for the control period in 

the year prior to the year of the control period for which the 

NOx allocations are being calculated. 

(2) The Department will allocate NOx allowances to the NOx Budget 

opt-in source in an amount equaling the heat input (in mmBtu) 

determined under paragraph (b)(1) of this subsection multiplied by

the lesser of:

a. The NOx Budget opt-in source's baseline NOx emissions 

rate (in lb/mmBtu) determined pursuant to subsection 

41.13.5(c); or

b. The most stringent State or Federal NOx emissions 

limitation applicable to the NOx Budget opt-in source 

during the control period.
Page 63 of 66

41.14 Retired unit exemption.

41.14.1 This section applies to any NOx Budget unit, other than a NOx Budget 

opt-in source, that is permanently retired.

41.14.2 Any NOx Budget unit, other than a NOx Budget opt-in source, that is 

permanently retired shall be exempt from the NOx Budget Trading 

Program, except for the provisions of this section, sections 41.1, 41.3, 

41.5, 41.8, 41.9, and subsection 41.4.6.

41.14.3 The exemption under subsection 41.14.2 shall become effective the day on 

which the unit is permanently retired. Within 30 days of permanent 

retirement, the NOx authorized account representative (authorized in 

accordance with section 41.6) shall submit a statement to the Department 

otherwise responsible for administering any NOx Budget permit for the 

unit. A copy of the statement shall be submitted to the Administrator. 

The statement shall state (in a format prescribed by the Department) that 

the unit is permanently retired and will comply with the requirements of 

subsection 41.14.5.

41.14.4 After receipt of the notice under subsection 41.14.3, the Department will 

amend any permit covering the source at which the unit is located to add 

the provisions and requirements of the exemption under subsections 

41.14.2 and 41.14.5.

41.14.5 Special provisions.

(a) A unit exempt under this section shall not emit any nitrogen oxides, 

starting on the date that the exemption takes effect. The owners and 

operators of the unit will be allocated allowances in accordance with 

section 41.5. 

(b) A unit exempt under this section and located at a source that is required, or 

but for this exemption would be required, to have a title V operating 

permit shall not resume operation unless the NOx authorized account 

representative of the source submits a complete NOx Budget permit 

application under subsection 41.7.4 for the unit not less than 18 months 

prior to the later of May 1, 2003 or the date on which the unit is to first 

resume operation.

(c) A unit exempt under this section and located at a source that is required, or 

but for this exemption would be required, to have a non-title V permit 

shall not resume operation unless the NOx authorized account 

representative of the source submits a complete NOx Budget permit 
Page 64 of 66

application under subsection 41.7.4 for the unit not less than 18 months 

prior to the later of May 1, 2003 or the date on which the unit is to first 

resume operation.

(d) The owners and operators and, to the extent applicable, the NOx 

authorized account representative of a unit exempt under this section shall 

comply with the requirements of the NOx Budget Trading Program 

concerning all periods for which the exemption is not in effect, even if 

such requirements arise, or must be complied with, after the exemption 

takes effect.

(e) A unit that is exempt under this section is not eligible to be a NOx Budget 

opt-in source under section 41.13.

(f) For a period of 5 years from the date the records are created, the owners 

and operators of a unit exempt under this section shall retain at the source 

that includes the unit, records demonstrating that the unit is permanently

retired. The 5-year period for keeping records may be extended for cause, 

at any time prior to the end of the period, in writing by the Department or 

the Administrator. The owners and operators bear the burden of proof that 

the unit is permanently retired.

(g) Loss of exemption.

(1) On the earlier of the following dates, a unit exempt under 

subsection 41.14.2 shall lose its exemption:

a. The date on which the NOx authorized account 

representative submits a NOx Budget permit application 

under subsection 41.14.5(b) or (c); or

b. The date on which the NOx authorized account 

representative is required under subsection 41.14.5(b) or (c) 

to submit a NOx Budget permit application.

(2) For the purpose of applying monitoring requirements under section 

41.10, a unit that loses its exemption under this section shall be 

treated as a unit that commences operation or commercial 

operation on the first date on which the unit resumes operation.

41.15 General Provisions

41.15.1 Purpose

The purpose of this regulation is to specify the requirements of a nitrogen 
Page 65 of 66

oxides budget trading program

41.15.2 Authority

These regulations are authorized pursuant to R.I. Gen. Laws § 42-17.1-2(s) 

and 23-23, as amended, and have been promulgated pursuant to the 

procedures set forth in the R.I. Administrative Procedures Act, R.I. Gen. 

Laws Chapter 42-35

41.15.3 Application

The terms and provisions of this regulation shall be liberally construed to 

permit the Department to effectuate the purposes of state law, goals and 

policies.

41.15.4 Severability

If any provision of this regulation or the application thereof to any person or 

circumstance, is held invalid by a court of competent jurisdiction, the 

validity of the remainder of the regulation shall not be affected thereby.

41.15.5 Effective Date

The foregoing regulation, "NOx Budget Trading Program”, as amended, 

after due notice, is hereby adopted and filed with the Secretary of State this 

___29th__ day of ______June____, 2007_ to become effective twenty (20) 

days thereafter, in accordance with the provisions of Chapters 23-23, 42-35, 

42-17.1, 42-17.6, of the General Laws of Rhode Island of 1956, as amended.
Page 66 of 66

W. Michael Sullivan, PhD., Director

Department of Environmental Management

Notice Given on: February 21, 2007

Public Hearing held: March 23, 2007

Filing Date: June 29, 2007

Effective Date: July 19, 2007