# STATE OF CONNECTICUT DEPARTMENT OF ENVIRONMENTAL PROTECTION

In the m:ltter of
The**S[~[e** ofConnecticut and CJpiw] District Energy**Cente~** Cogeneration Associates " ) ) ) ) ) ) Trading Agreement and Order No. 8249

Whereas, the Commissioner ofEnvironmental Protection ("Commissioner") and Capitol District Energy Center Cogeneration Associates ("CDEC") :lgrec that 

### it is in the public interest that they work coopel.ltively to improve the air quality within the State of Connecticut and that the use ofdiscrete emission reduction credit ("DERen) tr<1ding to reduce nitrogen oxide ("1 Ox") emissions will achieve this resuh in a timely and cost· 

### effective manner.
A. At the request and with the agreement ofCDEC, the Commissioner finds the following:
1. CDEC is a general partnership and subsidiary ofEI Paso Corporation. CDEC owns and operates one cogeneration plant at 490 Capitol Avenue, Hartford, Connecticut ("facility"). 2. At the facility, CDEC operates fuel burning equipment, consisting ofone GE PG6531 cogeneration turbine with an in-line duct burner, Connecticut Pennit Number 75-0064 ("turbine"), which is subject to Section 22a-174-22 ofthe Regulations ofConnecticut State Agencies ("Regulations") pertaining to the control ofNOx emissiops. The turbine operates on natural g:J..S as the primary fuel and No.2 fuel oil as the backup fuel. A continuous emissions monitor ("CEM") certified to 40 Code ofFeder.1 Regulations ("CFR") Part 75, measures NOx emissions from the turbine.



## , 3. When operating the turbine, CDEC sometimes exceeds the NOx allowable emission rate limit speCified in Section 22a-174-22(e)(3) ofthe Regulations.
4. Pursuant (0 Section 22a-174-220) ofthe Regulations, during the non-ozone season, CDEC intends to acquire approved DERCs until May 1, 2005 for the turbine at the facility.

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# PC:lpicol DislIict Energy Center Cogeneration Associates Trading Agreement :lnd 

### Order No. 8249

B. The Commissioner, in accordance with the provisions ofthis Trading Agreement and Order, pursuant to Section 22a-174-22(d)(3) ofthe Regulations, hereby :lllows CDEC to comply with Section 22a-174-22(d)(2) ofthe Regulations through use ofDERC trading.
C. With the agreement ofGOEC, the Commissioner, Jcting under Sections 22a-6, 22a171, 22a-174, 22a-176, ::md 22a-177 ofthe Connecticut General Statutes, hereby 

### orders CDEC as follows:


### 1. Upon issuance ofthis Trading Agreement and Order, at the facility, CDEC shall comply with Section 22a-174-22 ofthe Regulations through emission reduction trading. Until CDEC achieves pennanent compliance with the emission standard in Section 22a-174- 

### 22(e) ofthe Regulations orby May I, 2005, whichever occurs earlier:

a. CDEC shall use approved DERCs as required under this Trading Agreement and Order; and b. CDEC shall have in its possession sufficient approved DERCs [Q meet applicable NOx emission limits as allowed under this Trading Agreement and Order. 2. DERC use. Starting on October I, 2003, and until May 1,2005, before the first day ofeach non-ozone se:lson, CDEC shall have in its possession sufficient approved nERCs for the turbine based on the following:

a. Durin!! the non-ozone season: CDEC shall meet a non-ozone seasonal average emission limit of0.15 

### IbslMMBtu. Priorto October 1, 2003 and October 1, 2004, CDEC shall estimate and acquire the amount ofDERCs or allowances required for such non-ozone season needed to comply with Section 22a-174-22(e)(3) ofthe Regulations as follows:


### EstimatedDERCs (tons) 

### = [Estimated fuel use in MMBtu from October 1 through April 30 x (estimated seasonal average NOx emission rate in IbsJM:MBtu during October 1 through 

### April 30

- (0.95 x 0.151bsIMMBtu))J .;. 2000 pounds/ton.
No larerthan May 31,2004, and May I, 2005, when the turbine has a non-ozone seasonal :lver<lge actual NOx emission rate exceeding 0.15 Ibsfl...{MBtu, CDEC shaII calculate and permanently retire the amount ofDERCs used in the preceding non-ozone season as follows:

2

### CJpilOI District Energy Center Cogenernlion Associmes Tr<lding Agreement :lnd Order No. 8249

• , '......... 

# '. Actu,1 DERCs (tOns) 

### = [Actu,l fuel use in lVWBtu from October I through April 30 x (actual seasonal aveTZlge NOx emission**r~lte** in Ibs/M1v1Btu during Ocrober 1 through April 30

- (0.95 x**~.15IbslMMBtu»J';'** 2000 pounds/ton. 

### b. When the noniozone season CEM-recorded NOx emission rale is used to calculate DERCs used 

### by the turbine, 

### CDEC shall include missing data calculated in accordance with missing data substitution procedures under 40 CFR Pm 75.

c. 

### CDEC shall not exceed any NOx permillimitations for the turbine.
3. CDEC shall make and keep records for the turbine of: non-ozone season fuel use and fuel type; non-ozone season NOx emission rates, number ofoperating hours per non-ozone season, the numberofinvalid data hOUfS ofthe total operating hours per non-Olone season; the number ofDERCs in its possession, purchased and used (by serial numberifassigned) each non-Olone season in accordance with the appropriate emission rates and limits in this Trading Agreement and Order. CDEC shall maintain and submit such records in accordance with Section 22a-174-22 of the Regulations.
4. Record Keeoing. CDEC shall retain records and supporting documentation as described in this Trading Agreement and Orderfor a minimum offive years, commencing on the date such records were created. CDEC shall provide the records specified above to the Commissioner within thirty (30) days ofreceipt ofa written request from the·'Commissioner.
5. Reoorting. No later than July"30 ofevery year after issuance ofthis Trading Agreement and Order, CDEC shall submitin writing to [he Commissioner lhe nonozone season fuel consumption and amount ofall DERCs used (including serial numbers (ifassigned) and approved DERCs purchased from otherfacilities) for the turbine during the previous Octoberthrough April time period. These reports shall 

### be on a form prescribed by the Commissioner.
6. Allowance Use. Pursuant to Section 22a-174-22(d)(3) ofthe Regulations, CDEC may use NOx allowances, pursuant to Section 22a-174-22(j) ofthe Regulations to achieve all or a ponion ofthe reductions required by Section 22a-174-22 ofthe Regulations. Any allowance used for compliance with Section 22a-174-22(e) of [he Regulations shall be subject to all restrictions andlorrequirements applicable to DERCs contained in this Trading Agreement and Order. Each allowance used for compliance with Section 22a-174-22 ofthe Regulations shall be equivalent to one discrete emission reduction credit and sh::t.ll be deducted from CDEC's NOx Budget
3C::lpitol District Energy Center Cogenermion Associates Trading Agreement J.nd OrderNo. 8249**~)** 

## ... :'

# .,' Program compliance account upon such use. Allowances shall be considered used for compliance with Section 22a-174-22 ofthe Regulations when they are tr.:l.nsferred from the facility's compliance account or overdraft account to a Sw.te of Connecticut NOx .:l.JJowance retirement account, account II) CT0000000300 in the NOx Allowance Tracking System.


# , 7. DERC Doubling.:ft,t a minimum, DERCs required shall be adjusted upwards by 100% ifDERCs are not in CDEC's possession for use prior to the first day ofeach non-ozone season. However, based on the gravity ofthe noncompliance, the Commissionermay require additional upward adjustment.
8. Vintage Restriction. For the purposes ofcompliance with Section 22a-174-22 ofthe Regulations, DERCs/allowances shall 

### only remain valid for five (5) calendar years from the year ofthe generation/allocation ofsuch DERCsiallowances. DERCsiallowances generated/allocated more than five (5) calendaryears ago are not valid for use forcompliance with Section 22a-174-22 ofthe Regulations. Notwithstanding the above the DERCsiallowances generated/allocated prior to calendaryear2000 shall be valid for use until December 31, 2004.
9. Extension. No laterthan May 1,2005, with respect to the turbine, CDEC shall comply with the requirements ofSubdivision 22a-174-22(d)(2) ofthe Regulations. However, after full program review ofthis and otherTrading Agreements and Orders and, ifdetermined to 

### be appropriate, the Commissionermay grant a written extension ofthis Trading Agreement and Order.
10. Future Comoliance Report. On orbefore September 1, 2004, CDEC shall submit a report indicating how the facility shall comply with Section 22a-174-22 ofthe Regulations with respect 10 the turbine on and afterMay 1, 2005.
11. Full compliance. CDEC shall not be considered in full compliance with this Trading Agreement and Order until all actions required by this Trading Agreement and Orderhave been completed as approved and to the Commissioner's satisfaction.
12. Approvals. CDEC shall use besteffons to submitto the Commissioner all documents required by this Trading Agreement and Orderin a complete and approvable form. Ifthe Commissionernotifies CDEC that any document or other action is deficient, and does not approve it with conditions ormodifications, it is deemed disapproved, and CDEC shaH correctthe deficiencies and resubmit it within the time specified by the Commissioneror, ifno time is specified by the Commissioner, within 30 days ofthe Commissioner's notice ofdeficiencies. In approving any document or other action under this Trading Agreement and Order, the Commissioner may approve the document or other action as submitted or 4C::lpitol District Energy Center Cogeneration Associates Trading Agreement and Order No. 8249



# o perfonned or with such conditions or modific::ltions as the Commissionerdeems necessary to carry out the purposes ofthis TrJding Agreement and Order. Nothing in this paragraph shall excuse noncompliance or delay.
13. Definitions. As used in this Trading Agreement and Order, "Approved DERCs" are those for which theF0mmissionerhas provided written authoriz'Hion for use in compliance with Section 22a-174-22 ofthe Regulations; "Commissioner" means the Commissioner or arepresentative ofthe Conunissioner;**"Non~ozone** season" means the period from October 1 through April 

### 30 in any given calendaryear. The date of "issuance" ofthis Trading Agreement and Orderis the date the Trading Agreement and Orderis deposited in the U.S. mail orpersonally delivered, whicheveris earlier.
14. Dates. The date ofsubmission to the Commissioner ofany document required by this Trading Agreement and Order shall be the date such document is received by the Commissioner. The date ofany notice by the CommissionerunderTrading Agreement and Order, including but not limited [0 notice ofapproval or disapproval ofany document orother action, shall be the date such notice is deposited in the U.S. mail oris personally delivered, whicheveris earher. Except as otherwise specified in this Trading Agreement and Order, the word "day" as used in this Trading Agreement and Ordermeans calendar day. Any document or action which is required by this Trading Agreement and Order to be submitted orperformed by a date which falls on a Saturday, Sunday or a Connecticut orfederal holiday shall be submitted orperformed by the next day which is not a Saturday, Sunday or Connec'ticut orfederal holiday.
15. Certification ofdocuments. Any document, including but not limited to any notice, which is required to be submitted to the Commissionerunder this Trading Agreement and Order shall be signed by CDEC or, ifCDEC is not an individual, by anindividual who is an authorized representative ofCDEC, in accordance with Section 22a-174-2a(a) ofthe Regulations ofConnecticut State Agencies, and by the individual(s) responsible for actually preparing such document, and each such individual shall certify in writing as foHows: 

## "rhave personally examined and am familiar with the information submitted in this document and 

### all attachments thereto, and I certify, based on reasonable investigation, including my inquiry ofthose individuals responsible for obtaining the information, that the submitted information is true, accurate and complete to the best ofmy knowledge and belief. I understand that any false statement m:lde in the submitted information is punishable as acriminal offense under Section 53a-157b ofthe Connecticut General Statutes :lod any other applicable law."

5CJpitol District Energy Center Cogeneration Associates Trading Agreement :md OrderNo. 8249 16. NoncomoJiance. This Trading Agreement and Order is a final order ofthe Commissionerwith respect to the maners addressed herein, and is nonappeJbbJe and immediately enforceable. Failure to comply with this Trading Agreement and Ordermay subject CDEC to an injunction and penalties.
17. False statements. Any false statement in any information submitted pursuant to this Trading

### Agreern~t and Orderis punishable as acriminal offense under Section 53a-157b ofthe Connecticut General Statutes and any other applicable law.
18. Notice oftransfer: liabilitv ofCDEC. Until CDEC has fully complied with this Trading Agreement and Order, CDEC shall notify the Commissionerin writing no laterthan 15 days after transferring all or any ponion ofthe facility, the operations, the site or the business which is the subject ofthis Trading Agreement and Order or after obtaining anew mailing or location address. CDEC's obligations under this Trading Agreement and Order shall not 

### be affected by the passage oftitle to any property to any otherperson ormunicipality.
19. Commissioner's DOWers. Nothing in this Trading Agreement and Order shall affect the Commissioner's authority to institute any proceeding orrake any other action to prevent or abate violations oflaw, prevent or abate pollution, recover costs and natural resource damages, and to impose penalties for past, present, or future violations oflaw. 

### If at any time the Commissionerdetermines that the actions taken by CDEC pursuant to this Trading Agreement and Orderhave nOt successfully corrected all violations, fully characterizedthe extent or degree ofany pollution, or successfully abated orprevented pollution, the Commissionermay institute any proceeding to require CDEC to undenake further investigation orfurther action to prevent or abate violations orpollution.
20. CDEC's obligations under law. Nothing in this Trading Agreement and Order shall relieve CDEC ofother obligations under applicable federal, state and local law.
21. No assurance bv Commissioner. No provision ofthis Trading Agreement and Order and no action orinaction by the Commissioner shall be construed to constitute an assurance by the Commissionerthat the actions taken by CDEC pursuant to this Trading Agreement and Order will result in compliance orprevent or abate pollution.
22. Access to facilitv. Any representative ofthe Depanment ofEnvironmental Protection may enterthe facility without priornotice for the purposes ofmonitoring and enforcing the actions required or allowed by this Trading Agreement and Order.

6CJpitol DislIict Energy Center Cogener.Hion Associates Trading Agreement :lnd 

### OrderNo. 8249

, 

### , ··cJ 23. No effect on rig:hts of=Qtherpersons. This Trading Agreement and Order neither creates nor affects any rights ofpersons or municipalities !.hat are nOl panies to this Troding Agreement and Order.
24. No Creation ofPropenv Rie:hts. This TrJding Agreement and Orderdoes not create any property rightsfWith respect to these DERCs. 

# " 25. Notice to Commissionerofchanges. Within 15 days ofthe date CDEC becomes aware ofachange in any information submitted to the Commissionerunder this Trading Agreement and Order, or'that any such information was inaccurate or misleading orthat any relevant information was omitted, CDEC shall submit the correct oromitted information to !.he Commissioner.
26. Notification ofnoncompliance. In the event that CDEC becomes aware that it did not ormay not comply, ordid not ormay not comply on time, with any requirement ofthis Trading Agreement and Orderor ofany document required hereunder, CDEC shall immediately notify by telephone the individual identifiedin the next paragraph and shall take all reasonable steps to ensure that any noncompliance or delay is avoided or, ifunavoidable, is minimized to the greatest extent possible. Within five (5) days ofthe initial notice, CDEC shall submitin writing the date, time, and duration ofthe noncompliance and the reasons for the noncompliance or delay and propose, for the review and written approval ofthe Commissioner, dates by which compliance will be achieved, and CDEC shall comply with any dates which may be approved in writing by the Commissioner. Notification by CDEC shall not excuse noncompliance or delay, and the Commissioner's approval ofany compliance dates proposed shall not excuse noncompliance ordelay unless specifically so stated by the Commissionerin writing.
27. Submission ofdocuments. Any document required to be submitted to the Commissionerunder this Trading Agreement and Order shall, unless otherwise specified in this Trading Agreement and Orderorin writing by the Commissioner, 

### be directed to: 

### Ms. WendyJacobs Department ofEnvironmental Protection Bureau of!ill'Management Emissions and CreditTrading Section 

### 79 Elm Street Hartford, Connecticut 06106-5127

7

### C,JpilOI District Energy Center Cogeneration Associates Trading Agreement ,Jnd Order No. 8249 CDEC consents to 

### the issuance ofthis Trading Agreement and Order without further notice. The undersigned certifies th:u he/she is fully authorized to 

### enter into this Trading Agreement and Order ,Jnd to 

### leg,Jlly bind CDEC to the tenns and conditions of(he Trading Agreement and Order. Capitol Dislrict Energy Center Cogeneration Associates

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Issued as afin.! orderofthe Commissionerof Environmenlol**pro~~--..,.**



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## ~Z9 ,2003 

### !.) 

# "**~:~** /

, ArthurJ. 

### c Commiss oner

CITY OFHARTFORD LAND RECORDS
MAll.ED CERTIFIED 

### MAll., RETURN RECEIPT REQUESTED 

### Certified DocumentNo.



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