II 

111TH CONGRESS 

2D SESSION S. 2995 

To amend the Clean Air Act to establish a national uniform multiple air 

pollutant regulatory program for the electric generating sector. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 4, 2010 

Mr. CARPER (for himself, Mr. ALEXANDER, Ms. KLOBUCHAR, Ms. COLLINS, 

Mrs. FEINSTEIN, Mr. GREGG, Mrs. SHAHEEN, Mr. GRAHAM, Mr. KAUFMAN, Mr. SCHUMER, Mr. LIEBERMAN, and Ms. SNOWE) introduced the 

following bill; which was read twice and referred to the Committee on Environment and Public Works 

A BILL 

To amend the Clean Air Act to establish a national uniform 

multiple air pollutant regulatory program for the electric 

generating sector. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Clean Air Act Amend5 ments of 2010’’. 

6 SEC. 2. FINDINGS AND PURPOSES. 

7 Section 401 of the Clean Air Act (42 U.S.C. 7651) 

8 is amended to read as follows: 


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1 ‘‘SEC. 401. FINDINGS AND PURPOSES. 

2 ‘‘(a) FINDINGS.—Congress finds that— 

3 ‘‘(1) the presence of acidic compounds and as4 sociated precursors in the atmosphere and in deposi5 tion from the atmosphere represents a threat to nat6 ural resources, ecosystems, materials, visibility, and 

7 public health; 

8 ‘‘(2) the principal sources of the acidic com9 pounds and those precursors in the atmosphere are 

10 emissions of sulfur and nitrogen oxides from the 

11 combustion of fossil fuels; 

12 ‘‘(3) the problem of acid deposition is of na13 tional and international significance; 

14 ‘‘(4) strategies and technologies for the control 

15 of precursors to acid deposition exist now that are 

16 economically feasible, and improved methods are ex17 pected to become increasingly available over the next 

18 decade; 

19 ‘‘(5) current and future generations of people in 

20 the United States will be adversely affected by delay21 ing measures to remedy the problem; 

22 ‘‘(6) reduction of total atmospheric loading of 

23 sulfur dioxide and nitrogen oxides will enhance pro24 tection of the public health and welfare and the envi25 ronment; 


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1 ‘‘(7) control measures to reduce precursor emis2 sions from steam-electric generating units should be 

3 initiated without delay; 

4 ‘‘(8) exposure to sulfur oxides is associated 

5 with— 

6 ‘‘(A) decreased lung function and res7 piratory symptoms, in exercising asthmatics; 

8 and 

9 ‘‘(B) more serious indicators of adverse 

10 respiratory effects, such as respiratory-related 

11 emergency department visits and hospital ad12 missions, in the general population; 

13 ‘‘(9) exposure to nitrogen oxides is associated 

14 with worsened asthma symptoms, increased res15 piratory illnesses and symptoms, and serious indica16 tors of adverse respiratory effects such as res17 piratory-related emergency department visits and 

18 hospital admissions; 

19 ‘‘(10) gaseous emissions of sulfur oxides and ni20 trogen oxides may be transformed in the atmosphere 

21 to form particles; 

22 ‘‘(11) exposure to those particles has been asso23 ciated with adverse health and welfare effects, in24 cluding— 

25 ‘‘(A) premature mortality; 


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1 ‘‘(B) aggravation of respiratory and car2 diovascular disease (as indicated by hospital ad3 missions and emergency department visits); 

4 ‘‘(C) changes in lung function; 

5 ‘‘(D) increased respiratory symptoms (such 

6 as coughing, wheezing, and shortness of 

7 breath); 

8 ‘‘(E) impairment of visibility; 

9 ‘‘(F) adverse effects on ecosystem proc10 esses; 

11 ‘‘(G) impacts on climate; and 

12 ‘‘(H) damage or soiling of structures and 

13 property; 

14 ‘‘(12) in addition to the public welfare effects of 

15 materials damage and visibility, the ecological effects 

16 due to both gas and particle deposition of nitrogen 

17 and sulfur compounds include acidification (due to 

18 both nitrogen and sulfur), excess nitrogen enrich19 ment, and interactions between sulfur and 

20 methylmercury production; 

21 ‘‘(13) nitrogen oxide can react with volatile or22 ganic compounds in the presence of heat and sun23 light to form ground-level ozone; 

24 ‘‘(14) exposure to ground-level ozone can— 


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1 ‘‘(A) cause symptoms such as wheezing 

2 and shortness of breath; 

3 ‘‘(B) inflame the linings of the lungs; 

4 ‘‘(C) aggravate respiratory illnesses such 

5 as asthma, emphysema, and bronchitis, leading 

6 to increased medication use, school absences, 

7 doctor, and emergency department visits and 

8 hospital admissions; 

9 ‘‘(D) increase susceptibility to respiratory 

10 infection; 

11 ‘‘(E) in the case of long-term exposure, 

12 permanently damage lung tissue; and 

13 ‘‘(F) in the case of short-term exposure, be 

14 associated with increased nonaccidental and 

15 cardiopulmonary mortality; 

16 ‘‘(15) exposure to ozone damages vegetation 

17 and ecosystems; 

18 ‘‘(16) specifically, ozone exposure can visibly 

19 damage the leaves of plants and photosynthesis, the 

20 process by which plants produce food; 

21 ‘‘(17) impaired food production leads to re22 duced plant growth and reproduction, resulting in 

23 reduced forestry production, crop yields, and overall 

24 plant vigor; 


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1 ‘‘(18) loss of vigor can result in increased sus2 ceptibility of plants to insect attack, disease, harsh 

3 weather, and interspecies competition; 

4 ‘‘(19) all of those adverse effects of ozone have 

5 implications for global crop production and food se6 curity; and 

7 ‘‘(20) visible ozone injury to leaves can result in 

8 a loss of aesthetic value in areas of special scenic 

9 significance, such as national parks and wilderness 

10 areas. 

11 ‘‘(b) PURPOSES.—The purposes of this title are— 

12 ‘‘(1) to reduce the adverse public and environ13 mental health effects caused by the emission of sul14 fur dioxide and nitrogen oxides, including the effects 

15 of acid deposition, particulate matter, and ozone, 

16 through reductions in annual emissions of sulfur di17 oxide and nitrogen oxides in the 48 contiguous 

18 States and the District of Columbia; 

19 ‘‘(2) to effectuate those reductions by requiring 

20 compliance by affected sources with prescribed emis21 sion limitations by specified deadlines, which limita22 tions may be met through alternative methods of 

23 compliance provided by an emission allocation and 

24 transfer system; and 


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1 ‘‘(3) to encourage energy conservation, use of 

2 renewable and clean alternative technologies, and 

3 pollution prevention as a long-range strategy, con4 sistent with this title, for reducing air pollution and 

5 other adverse impacts of energy production and 

6 use.’’. 

7 SEC. 3. REVISIONS TO SULFUR DIOXIDE ALLOWANCE PRO8 GRAM. 

9 (a) IN GENERAL.—Title IV of the Clean Air Act (re10 lating to acid deposition control) (42 U.S.C. 7651 et seq.) 

11 is amended by adding at the end the following: 

12 ‘‘SEC. 417. INTERIM CLEAN AIR INTERSTATE RULE. 

13 ‘‘(a) IN GENERAL.—Notwithstanding any other pro14 vision of law, the Clean Air Interstate Rule and related 

15 Federal implementation plans promulgated and modified 

16 by the Administrator on May 12, 2005 (70 Fed. Reg. 

17 25162), April 28, 2006 (71 Fed. Reg. 25288 and 25328), 

18 October 19, 2007 (72 Fed. Reg. 59190), November 2, 

19 2007 (72 Fed. Reg. 62338), April 28, 2008 (73 Fed. Reg. 

20 22818), and November 3, 2009 (74 Fed. Reg. 56721), 

21 shall remain in force and effect with respect to all provi22 sions relating in any way to nitrogen oxides and sulfur 

23 dioxide emitted through calendar year 2011. 

24 ‘‘(b) EXCEPTIONS.— 


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1 ‘‘(1) IN GENERAL.—Subsection (a) shall not 

2 apply with respect to the response of the Adminis3 trator (71 Fed. Reg. 25328 (April 28, 2006)) to the 

4 petition of the State of North Carolina under section 

5 126. 

6 ‘‘(2) OZONE PROGRAMS.—Any provision of the 

7 rules referred to in subsection (a) relating to the es8 tablishment and implementation of a seasonal ozone 

9 emission cap-and-trade program for nitrogen oxides 

10 shall not expire, but shall remain in full force and 

11 effect, with respect to nitrogen oxides emitted in cal12 endar year 2012 and thereafter. 

13 ‘‘(3) REVISIONS.— 

14 ‘‘(A) IN GENERAL.—Notwithstanding para15 graph (2), if the Administrator makes the de16 termination described in subparagraph (B), the 

17 Administrator may— 

18 ‘‘(i) not later than January 1, 2020, 

19 and every 5 years thereafter, revise the 

20 provisions referred to in paragraph (2) to 

21 reduce the total quantity of tons of nitro22 gen oxides in— 

23 ‘‘(I) the ozone season nitrogen 

24 oxides budget for electric generating 

25 units; 


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1 ‘‘(II) any ozone season nitrogen 

2 oxides budget for nonelectric gener3 ating units; and 

4 ‘‘(III) the ozone season nitrogen 

5 oxides trading budget for any State 

6 that is, or the sources in which are, 

7 subject to those provisions; and 

8 ‘‘(ii) make those provisions consistent, 

9 to the extent the Administrator determines 

10 is necessary or appropriate, with the re11 quirements of the regulations promulgated 

12 in accordance with section 419(e). 

13 ‘‘(B) DETERMINATION.—The determina14 tion described in this subparagraph is a deter15 mination by the Administrator that emissions 

16 should be reduced further— 

17 ‘‘(i) to protect public health or the en18 vironment; 

19 ‘‘(ii) to assist with attainment or 

20 maintenance with respect to national ambi21 ent air quality standards; or 

22 ‘‘(iii) to assist States in meeting emis23 sion reduction obligations under section 

24 110(a)(2)(D). 


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1 ‘‘(4) ELIMINATION OF FUEL ADJUSTMENT FAC2 TORS.—Not later than 90 days after the date of en3 actment of this section, the Administrator may— 

4 ‘‘(A) eliminate any allocation of nitrogen 

5 oxide allowances based on fuel-adjusted heat6 input under sections 96.140, 96.142, 96.340, 

7 and 96.342 of title 40, Code of Federal Regula8 tions (or successor regulations); and 

9 ‘‘(B) use a different distribution method 

10 for those nitrogen oxide allowances. 

11 ‘‘SEC. 418. PHASE III SULFUR DIOXIDE REQUIREMENTS. 

12 ‘‘(a) ESTABLISHMENT.—Not later than January 1, 

13 2011, the Administrator shall promulgate regulations to 

14 establish, for affected units in the 48 contiguous States 

15 and the District of Columbia, a sulfur dioxide allowance 

16 trading program to reduce sulfur dioxide emissions from 

17 affected units. 

18 ‘‘(b) APPLICABILITY.—After January 1, 2012— 

19 ‘‘(1) each affected unit shall be subject to regu20 lation under this section; and 

21 ‘‘(2) each source that includes 1 or more such 

22 affected units shall be considered to be an affected 

23 source under this section. 

24 ‘‘(c) LIMITATIONS ON EMISSIONS.— 

25 ‘‘(1) PROHIBITION.— 


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1 ‘‘(A) IN GENERAL.—Beginning on January 

2 1, 2012, it shall be unlawful for the affected 

3 units at an affected source to emit a total num4 ber of tons of sulfur dioxide during a calendar 

5 year in excess of the number of tons authorized 

6 by the sulfur dioxide allowances held for the af7 fected source for that year by the owners and 

8 operators of the affected source and affected 

9 units. 

10 ‘‘(B) QUALIFICATION.—Only sulfur dioxide 

11 allowances described in paragraphs (2), (3), 

12 and (5) of subsection (d) shall be held in order 

13 to meet the requirements of subparagraph (A). 

14 ‘‘(2) LIMITATION ON TOTAL EMISSIONS.—The 

15 Administrator shall issue allowances authorizing an 

16 annual tonnage of emissions of sulfur dioxide from 

17 affected units in the United States equal to— 

18 ‘‘(A) for each of calendar years 2012 

19 through 2014, 3,500,000 tons; 

20 ‘‘(B) for each of calendar years 2015 

21 through 2017, 2,000,000 tons; 

22 ‘‘(C) for each calendar years 2018 through 

23 2020, 1,500,000 tons; and 

24 ‘‘(D) for calendar year 2021 and each cal25 endar year thereafter— 


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1 ‘‘(i) 1,500,000 tons; or 

2 ‘‘(ii) a lesser quantity, if the Adminis3 trator determines that emissions should be 

4 reduced further— 

5 ‘‘(I) to protect public health or 

6 the environment; 

7 ‘‘(II) to assist with attainment or 

8 maintenance with respect to the at9 tainment of national ambient air qual10 ity standards; or 

11 ‘‘(III) to assist States in meeting 

12 emission reduction obligations under 

13 section 110(a)(2)(D). 

14 ‘‘(3) REGULATIONS.—The regulations promul15 gated by the Administrator to carry out this section 

16 shall establish requirements for the allowance trad17 ing program under this section, including require18 ments concerning— 

19 ‘‘(A) the selection of a designated rep20 resentative for each affected source, who shall 

21 make all submissions to the Administrator 

22 under this section for the affected source; 

23 ‘‘(B) the issuance, recording, tracking, 

24 holding, transfer, auction, and use of sulfur di25 oxide allowances; 


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1 ‘‘(C) the monitoring and reporting of emis2 sions, quality assurance of data, and record3 keeping, which shall be consistent with sub4 sections (a) and (d) of section 412, as applied 

5 to the owners and operators of an affected unit 

6 and an affected source, except that subsection 

7 (a) shall apply in lieu of the deadlines for pro8 mulgation of regulations under subsections (a) 

9 and (d) of section 412; 

10 ‘‘(D) excess emission penalties and offsets 

11 in accordance with section 411; 

12 ‘‘(E) permits in accordance with section 

13 408(h)(3) and title V, as applied to— 

14 ‘‘(i) an affected unit and an affected 

15 source; and 

16 ‘‘(ii) allowances under subsection (d); 

17 ‘‘(F) provisions that require— 

18 ‘‘(i) a statement submitted by the des19 ignated representative of an owner or oper20 ator that the owner or operator will hold 

21 allowances authorizing emissions equaling 

22 not less than the actual emissions of the 

23 affected units at the affected source, in ac24 cordance with this section, to be considered 


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1 to meet the compliance planning require2 ments of title V; and 

3 ‘‘(ii) recording by the Administrator 

4 of a transfer of allowances to amend auto5 matically all applicable permit applications, 

6 compliance plans, and permits; and 

7 ‘‘(G) the public availability of all informa8 tion concerning the activities described in sub9 paragraphs (A) through (E) that is not con10 fidential or is emission data that, pursuant to 

11 section 114(c), cannot be confidential. 

12 ‘‘(d) ALLOWANCES.— 

13 ‘‘(1) IN GENERAL.—Not later than January 1, 

14 2011, the Administrator shall promulgate regula15 tions providing for the distribution of sulfur dioxide 

16 allowances issued in accordance with subsection 

17 (c)(2). 

18 ‘‘(2) DISTRIBUTION.—The regulations shall 

19 provide that— 

20 ‘‘(A) the same total number of allowances 

21 issued under section 405 that are required to be 

22 offered for sale at auction in calendar year 

23 2011 under subsection (c)(7), and paragraphs 

24 (1) and (2) of subsection (d), of section 416 


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1 shall be auctioned in each of vintage years 2012 

2 through 2017; 

3 ‘‘(B) for vintage year 2018 and each cal4 endar year thereafter, the number of allowances 

5 auctioned shall increase by 10 percent each 

6 year; and 

7 ‘‘(C) subject to paragraph (3), the remain8 ing allowances shall be distributed in 2 pools 

9 that are determined by the Administrator to 

10 provide for a fair and equitable distribution of 

11 allowances between— 

12 ‘‘(i) affected units that received Phase 

13 II allowance allocations under sections 403 

14 and 405; and 

15 ‘‘(ii) affected units that did not re16 ceive any Phase II allowance allocations 

17 under sections 403 and 405. 

18 ‘‘(3) REQUIREMENTS RELATING TO POOLS.— 

19 ‘‘(A) IN GENERAL.—The Administrator 

20 shall determine the fairness and equitability of 

21 the size of the pools described in paragraph 

22 (2)(C) based on the Phase II allowance alloca23 tions and not on the current ownership of those 

24 allowances. 

25 ‘‘(B) DISTRIBUTION.— 


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1 ‘‘(i) ACCOUNTS.—Allowances in the 

2 pool described in paragraph (2)(C)(i) shall 

3 be distributed to the account of each facil4 ity and each general account in the allow5 ance tracking system under section 403(c), 

6 without cost to the recipients, in a quantity 

7 equal to, as of the date that is 180 days 

8 after the date of enactment of this section, 

9 the proportion that— 

10 ‘‘(I) the pro rata share of each 

11 such account of the total number of 

12 allowances; bears to 

13 ‘‘(II) the total number of allow14 ances that were held in all such ac15 counts. 

16 ‘‘(ii) SIMILAR METHODOLOGY.—Allow17 ances in the pool described in paragraph 

18 (2)(C)(ii) shall be distributed using the 

19 same or similar allocation methodology as 

20 was used under sections 403 and 405. 

21 ‘‘(C) LIMITATION ON NUMBER OF ALLOW22 ANCES.—In no case may the total number of al23 lowances distributed under paragraph (2)(C) 

24 exceed the annual tonnage limitation for emisVerDate Nov 24 2008 00:46 Feb 09, 2010 Jkt 089200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S2995.IS S2995

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1 sions of sulfur dioxide from affected units speci2 fied in subsection (c)(2). 

3 ‘‘(4) TIMING OF ALLOCATIONS.—Not later than 

4 January 1, 2011, and each year thereafter, the Ad5 ministrator shall allocate allowances to affected 

6 units. 

7 ‘‘(5) PREVIOUSLY BANKED ALLOWANCES.— 

8 ‘‘(A) IN GENERAL.—Any sulfur dioxide al9 lowances issued under sections 403 through 416 

10 or the rules referred to in section 417(a) for 

11 any vintage year before 2012 that are not used 

12 to meet any requirements under sections 403 

13 through 416 or those rules, and that are not 

14 otherwise retired by the Administrator, may be 

15 used to meet requirements under this section. 

16 ‘‘(B) VINTAGE YEARS BEFORE 2010.—Each 

17 sulfur dioxide emission allowance issued for a 

18 vintage year before 2010 shall authorize a 

19 quantity of sulfur dioxide emissions equal to 1 

20 ton of sulfur dioxide. 

21 ‘‘(C) VINTAGE YEAR 2010 OR 2011.—Each 

22 sulfur dioxide emission allowance issued for vin23 tage year 2010 or 2011 shall authorize a quantity of sulfur dioxide emissions equal to 1 24 ⁄2 ton 

25 of sulfur dioxide. 


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1 ‘‘(6) NO PROPERTY RIGHT.—An allowance 

2 issued under this section does not constitute a prop3 erty right. 

4 ‘‘(e) REPLACEMENT OF SULFUR DIOXIDE PRO5 GRAM.—Except as expressly provided in this section, the 

6 provisions and requirements of sections 404, subsections 

7 (a) through (f), paragraphs (1) through (5) of subsection 

8 (g), and subsections (h) through (j), of section 405, sec9 tions 406 through 410, and sections 412 through 416, 

10 concerning emissions of sulfur dioxide shall not apply to 

11 any such emissions in calendar year 2012 or any calendar 

12 year thereafter. 

13 ‘‘(f) EFFECT ON OTHER REQUIREMENTS.— 

14 ‘‘(1) NO EXEMPTION OR EXCLUSION.— 

15 ‘‘(A) IN GENERAL.—Nothing in this sec16 tion exempts or excludes the owner or operator 

17 of any affected source or affected unit from 

18 compliance with any other applicable require19 ments of this Act. 

20 ‘‘(B) LIABILITY.—Any liability for excess 

21 emission penalties under this section shall not 

22 limit the application of section 113, 114, 120, 

23 or 304 to the owner or operator. 

24 ‘‘(2) SEPARATE VIOLATIONS.— 


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1 ‘‘(A) IN GENERAL.—Each ton of sulfur di2 oxide emitted in violation of subsection (c)(1), 

3 as implemented in the regulations promulgated 

4 under subsection (c)(3), shall be a violation of 

5 this title. 

6 ‘‘(B) SEPARATE DAYS.—For a calendar 

7 year during which an emission described in sub8 paragraph (A) occurs, each day of that year 

9 shall be a violation of this title. 

10 ‘‘SEC. 419. NITROGEN OXIDE CONTROL AND TRADING PRO11 GRAM. 

12 ‘‘(a) DEFINITIONS.—In this section: 

13 ‘‘(1) AFFECTED UNIT.—The term ‘affected 

14 unit’, with respect to nitrogen oxides, means a fossil 

15 fuel-fired electric generating facility (including a co16 generation facility) that— 

17 ‘‘(A) on or after January 1, 1985, served 

18 as a generator with a nameplate capacity great19 er than 25 megawatts; and 

20 ‘‘(B) produces electricity for sale. 

21 ‘‘(2) ZONE 1 STATE.—The term ‘Zone 1 State’ 

22 means the District of Columbia or any of the States 

23 of Alabama, Arkansas, Connecticut, Delaware, Flor24 ida, Georgia, Illinois, Indiana, Iowa, Kentucky, Lou25 isiana, Maine, Maryland, Massachusetts, Michigan, 


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1 Minnesota, Mississippi, Missouri, New Hampshire, 

2 New Jersey, New York, North Carolina, Ohio, Penn3 sylvania, Rhode Island, South Carolina, Tennessee, 

4 Texas, Vermont, Virginia, West Virginia, and Wis5 consin. 

6 ‘‘(3) ZONE 2 STATE.—The term ‘Zone 2 State’ 

7 means any State within the 48 contiguous States 

8 that is not a Zone 1 State. 

9 ‘‘(b) ESTABLISHMENT.—Not later than January 1, 

10 2011, the Administrator shall promulgate regulations to 

11 establish 2 nitrogen oxide allowance trading programs to 

12 reduce nitrogen oxide emissions for affected units— 

13 ‘‘(1) 1 of which programs shall be for affected 

14 units in the Zone 1 States; and 

15 ‘‘(2) the other of which programs shall be for 

16 affected units in the Zone 2 States. 

17 ‘‘(c) APPLICABILITY.—Beginning on January 1, 

18 2012, each source that includes 1 or more affected units 

19 shall be an affected source under this section. 

20 ‘‘(d) LIMITATIONS ON EMISSIONS.— 

21 ‘‘(1) ZONE 1 PROHIBITION.— 

22 ‘‘(A) IN GENERAL.—Beginning on January 

23 1, 2012, it shall be unlawful for the affected 

24 units at an affected source in a Zone 1 State 

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1 ing a calendar year in excess of the number of 

2 nitrogen oxide allowances held for the affected 

3 source for that year by the owners and opera4 tors of the affected source and the affected 

5 units. 

6 ‘‘(B) LIMITATION.—Only nitrogen oxide al7 lowances described in paragraphs (1)(A) and 

8 (6) of subsection (f) shall be held in order to 

9 meet the requirements of subparagraph (A). 

10 ‘‘(2) ZONE 2 PROHIBITION.— 

11 ‘‘(A) IN GENERAL.—Beginning on January 

12 1, 2012, it shall be unlawful for the affected 

13 units at an affected source in a Zone 2 State 

14 to emit a total quantity of nitrogen oxides dur15 ing a calendar year in excess of the number of 

16 nitrogen oxide allowances held for the affected 

17 source for that year by the owners and opera18 tors of the affected source and the affected 

19 units. 

20 ‘‘(B) LIMITATION.—Only nitrogen oxide al21 lowances described in subsection (f)(1)(B) shall 

22 be held in order to meet the requirements of 

23 subparagraph (A). 

24 ‘‘(3) ZONE 1 STATE LIMITATIONS ON TOTAL

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1 ances authorizing an annual tonnage of emissions of 

2 nitrogen oxides from affected units in the Zone 1 

3 States that are equal, in the aggregate, to— 

4 ‘‘(A) for each of calendar years 2012 

5 through 2014, 1,390,000 tons; 

6 ‘‘(B) for each of calendar years 2015 

7 through 2019, 1,300,000 tons; and 

8 ‘‘(C) for calendar year 2020 and each cal9 endar year thereafter— 

10 ‘‘(i) 1,300,000 tons; or 

11 ‘‘(ii) a lesser quantity, if the Adminis12 trator determines that emissions should be 

13 reduced further— 

14 ‘‘(I) to protect public health or 

15 the environment; 

16 ‘‘(II) to assist with attainment or 

17 maintenance with respect to national 

18 ambient air quality standards; or 

19 ‘‘(III) to assist States in meeting 

20 emission reduction obligations under 

21 section 110(a)(2)(D). 

22 ‘‘(4) ZONE 2 STATE LIMITATIONS ON TOTAL

23 EMISSIONS.—The Administrator shall issue allow24 ances authorizing an annual tonnage limitation for 

25 emissions of nitrogen oxides from affected units in 


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1 the Zone 2 States that are equal, in the aggregate, 

2 to— 

3 ‘‘(A) for each of calendar years 2012 

4 through 2014, 510,000 tons; 

5 ‘‘(B) for each of calendar years 2015 

6 through 2019, 320,000 tons; and 

7 ‘‘(C) for calendar year 2020 and each cal8 endar year thereafter— 

9 ‘‘(i) 320,000 tons; or 

10 ‘‘(ii) a lesser quantity, if the Adminis11 trator determines that emissions should be 

12 reduced further— 

13 ‘‘(I) to protect public health or 

14 the environment; 

15 ‘‘(II) to assist with attainment or 

16 maintenance with respect to national 

17 ambient air quality standards; or 

18 ‘‘(III) to assist States in meeting 

19 emission reduction obligations under 

20 section 110(a)(2)(D). 

21 ‘‘(e) REGULATIONS.—The regulations promulgated 

22 by the Administrator to carry out this section shall estab23 lish requirements for the allowance trading program under 

24 this section, including requirements concerning— 


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1 ‘‘(1) the selection of a designated representative 

2 for each affected source, who shall make all submis3 sions to the Administrator under this section for the 

4 affected source; 

5 ‘‘(2) the issuance, recording, tracking, holding, 

6 transfer, auction, and use of nitrogen oxide allow7 ances; 

8 ‘‘(3) the monitoring and reporting of emissions, 

9 quality assurance of data, and recordkeeping, which 

10 shall be consistent with section 412(a) and section 

11 412(d), as applied to the owners and operators of an 

12 affected unit and an affected source, except that 

13 subsection (a) shall apply in lieu of the deadlines for 

14 promulgation of regulations under subsections (a) 

15 and (d) of section 412; 

16 ‘‘(4) excess emission penalties and offsets in ac17 cordance with section 411; 

18 ‘‘(5) permits in accordance with section 

19 408(h)(3) and title V, as applied to— 

20 ‘‘(A) an affected unit and an affected 

21 source; and 

22 ‘‘(B) allowances under subsection (f); 

23 ‘‘(6) provisions that require— 

24 ‘‘(A) a statement submitted by the des25 ignated representative of an owner or operator 


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1 that the owner or operator will hold allowances 

2 authorizing emissions equaling not less than the 

3 actual emissions of the affected units at the af4 fected source, in accordance with this section, 

5 to be considered to meet the compliance plan6 ning requirements of title V; and 

7 ‘‘(B) recordation by the Administrator of a 

8 transfer of allowances to amend automatically 

9 all applicable permit applications, compliance 

10 plans, and permits; and 

11 ‘‘(7) the public availability of all information 

12 concerning the activities described in paragraphs (1) 

13 through (5) that is not confidential or is emission 

14 data that, pursuant to section 114(c), cannot be con15 fidential. 

16 ‘‘(f) ALLOWANCES.— 

17 ‘‘(1) IN GENERAL.—Not later than January 1, 

18 2012, the Administrator shall promulgate regula19 tions to establish a methodology for 2 distributions 

20 of the nitrogen oxide allowances to— 

21 ‘‘(A) each affected unit in a Zone 1 State 

22 in accordance with subsection (d)(3); and 

23 ‘‘(B) each affected unit in a Zone 2 State 

24 in accordance with subsection (d)(4). 


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1 ‘‘(2) ACCOUNTING.—The Administrator shall 

2 account in the nitrogen oxide allowance distribution 

3 methodology for a reserve of allowances for new 

4 units in Zone 1 States and Zone 2 States. 

5 ‘‘(3) TIMING OF ALLOCATIONS.—Not later than 

6 January 1, 2011, and each year thereafter, the Ad7 ministrator shall allocate allowances to affected 

8 units. 

9 ‘‘(4) DISTRIBUTION OF ALLOWANCES.— 

10 ‘‘(A) IN GENERAL.—The regulations pro11 mulgated under paragraph (1) shall provide 

12 that the Administrator shall— 

13 ‘‘(i) establish an auction for distrib14 uting nitrogen oxide allowances to affected 

15 units; and 

16 ‘‘(ii) require— 

17 ‘‘(I) a total of zero nitrogen oxide 

18 allowances in calendar years 2011 

19 through 2013 to be offered for sale in 

20 an auction; 

21 ‘‘(II) that the total number of ni22 trogen oxide allowances to be offered 

23 for sale at auction in calendar year 

24 2014 shall— 


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1 ‘‘(aa) be the same as the 

2 total number of sulfur dioxide al3 lowances issued under section 

4 418(d)(2)(A) for that calendar 

5 year; and 

6 ‘‘(bb) increase by 10 percent 

7 for each calendar year thereafter; 

8 and 

9 ‘‘(III) subject to subparagraph 

10 (B), that the remaining allowances 

11 shall be distributed in 2 pools that are 

12 determined by the Administrator to 

13 provide for a fair and equitable dis14 tribution of allowances between— 

15 ‘‘(aa) affected units that 

16 shall receive Zone 1 allowances; 

17 and 

18 ‘‘(bb) affected units that 

19 shall receive Zone 2 allowances. 

20 ‘‘(B) NO ALLOCATION BASED ON CERTAIN

21 ADJUSTMENT FACTORS.—The Administrator 

22 shall determine the allocation methodology for 

23 use in implementing subparagraph (A)(ii)(III), 

24 but shall not allocate nitrogen oxide allowances 


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1 to affected units based on baseline heat input 

2 fuel adjustment factors. 

3 ‘‘(5) PREVIOUSLY BANKED ALLOWANCES.— 

4 ‘‘(A) IN GENERAL.—Any nitrogen oxide al5 lowances issued under the rules referred to in 

6 section 417(a) concerning annual nitrogen oxide 

7 emissions for any vintage year before 2012 that 

8 are not used to meet any requirements under 

9 those rules, and that are not otherwise retired 

10 by the Administrator, may be used to meet re11 quirements under this section concerning an12 nual nitrogen oxide emissions applicable to 

13 sources in Zone 1 States. 

14 ‘‘(B) NATURE OF ALLOWANCES.—Each al15 lowance described in subparagraph (A) is a lim16 ited authorization to emit, in accordance with 

17 the requirements of this section, 1 ton of nitro18 gen oxide. 

19 ‘‘(6) NO PROPERTY RIGHT.—An allowance 

20 issued under this section does not constitute a prop21 erty right. 

22 ‘‘(g) EFFECT ON OTHER REQUIREMENTS.— 

23 ‘‘(1) IN GENERAL.—Nothing in this section ex24 empts or excludes the owner or operator of any af25 fected source or affected unit from compliance with 


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1 any other applicable requirements of this Act, and 

2 any liability for excess emission penalties under this 

3 section shall not limit the application of section 113, 

4 114, 120, or 304 to the owner or operator. 

5 ‘‘(2) SEPARATE VIOLATIONS.—Each ton of ni6 trogen oxides emitted in violation of paragraph (1) 

7 or (2) of subsection (d), as implemented in the regu8 lations promulgated under subsection (e), shall be a 

9 violation of this title, and, for a calendar year during 

10 which the emission occurs, each day of that year 

11 shall be a violation of this title.’’. 

12 (b) CONFORMING AMENDMENTS.—Section 411 of the 

13 Clean Air Act (42 U.S.C. 7651j) is amended— 

14 (1) in subsection (a), by striking the subsection 

15 designation and heading and all that follows through 

16 ‘‘That penalty’’ and inserting the following: 

17 ‘‘(a) EXCESS EMISSIONS PENALTY.—The owner or 

18 operator of any unit or process source subject to the re19 quirements of sections 403, 404, 405, 406, 407, 409, 410, 

20 417, or 418, or designated under section 419, that emits 

21 sulfur dioxide or nitrogen oxides for any calendar year in 

22 excess of the emission limitation requirement applicable 

23 to the unit or source or in excess of the allowances the 

24 owner or operator holds for use for the unit or source for 

25 that calendar year, shall be liable for the payment of an 


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1 excess emissions penalty, except in a case in which the 

2 emissions were authorized pursuant to section 110(f). The 

3 excess emission penalty for the phase II sulfur dioxide re4 quirements under section 418 and for the nitrogen oxide 

5 control and trading program requirements under section 

6 419 shall be calculated on the basis of the number of tons 

7 emitted in excess of the allowances the operator holds for 

8 use for the unit for that year, multiplied by 2 times the 

9 market price of such allowances for the same vintage year 

10 emission allowances. Any such penalty shall be imme11 diately due and payable without demand to the Adminis12 trator as provided in regulations to be issued by the Ad13 ministrator under sections 418 and 419. For the require14 ments established under title IV of the Clean Air Act 

15 Amendments of 1990, that penalty’’; and 

16 (2) in subsection (b), by striking the subsection 

17 designation and heading and all that follows through 

18 ‘‘The owner or operator of the source shall,’’ and in19 serting the following: 

20 ‘‘(b) EXCESS EMISSION OFFSET.—The owner or op21 erator of any affected source or any affected unit that 

22 emits sulfur dioxide or nitrogen oxides during any cal23 endar year in excess of the emissions limitation require24 ment of the unit or of the allowances held for the unit 

25 for the calendar year shall be liable to offset the excess 


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1 emission by an equal tonnage amount in the following cal2 endar year, or such longer period as the Administrator 

3 may prescribe. The owner or operator of the source or the 

4 unit shall,’’. 

5 SEC. 4. MERCURY REDUCTIONS FOR THE COAL-FIRED 

6 ELECTRIC GENERATING SECTOR. 

7 (a) MACT MERCURY REQUIREMENT REDUC8 TIONS.—Section 112(d) of the Clean Air Act (42 U.S.C. 

9 7412(d)) is amended by adding at the end the following: 

10 ‘‘(11) ELECTRIC UTILITY STEAM GENERATING

11 UNITS.— 

12 ‘‘(A) IN GENERAL.—The Administrator 

13 shall regulate coal- and oil-fired electric utility 

14 steam generating units under section 112(d). 

15 ‘‘(B) MINIMUM PERCENT REDUCTION IN

16 EMISSIONS.—In promulgating emission stand17 ards for the coal-fired electric utility steam gen18 erating units under this section, the Adminis19 trator shall— 

20 ‘‘(i) ensure that such standards 

21 achieve at least a 90-percent reduction in 

22 emissions of mercury when applied to the 

23 listed category as a whole; and 

24 ‘‘(ii) consult with States that already 

25 have a coal-fired electric utility steam genVerDate Nov 24 2008 00:46 Feb 09, 2010 Jkt 089200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 E:\BILLS\S2995.IS S2995

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1 erating unit mercury reduction program in 

2 place before setting the standard. 

3 ‘‘(C) FAILURE TO PROMULGATE LIMITA4 TIONS.—If the Administrator fails to promul5 gate nationally applicable emission limitations 

6 under this paragraph for electric utility steam 

7 generating units by January 1, 2012, electric 

8 utility steam generating units in existence as of 

9 that date shall be required to meet, by not later 

10 than January 1, 2015, maximum achievable 

11 control technology emission limitations, as de12 termined on a case-by-case basis under section 

13 112(j).’’. 

14 (b) ELECTRIC UTILITY STEAM GENERATING UNIT

15 MONITORING AND REPORTING PROGRAM.—Section 112 of 

16 the Clean Air Act (42 U.S.C. 7412) is amended by adding 

17 at the end the following: 

18 ‘‘(t) MERCURY MONITORING AND REPORTING PRO19 GRAM.— 

20 ‘‘(1) MONITORING.—The Administrator shall 

21 promulgate regulations requiring— 

22 ‘‘(A) the operation, reporting, and certifi23 cation of continuous emission monitoring sys24 tems to accurately measure the quantity of 


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1 mercury that is emitted by electric coal utility 

2 steam generating units; and 

3 ‘‘(B) verification and reporting of mercury 

4 emissions at each electric coal utility steam gen5 erating unit. 

6 ‘‘(2) REPORTING.— 

7 ‘‘(A) IN GENERAL.—Not less often than 

8 quarterly, the owner or operator of an affected 

9 unit that is an electric coal utility steam gener10 ating unit shall submit to the Administrator a 

11 report on the monitoring of emissions of mer12 cury carried out by the owner or operator in ac13 cordance with the regulations promulgated 

14 under paragraph (1). 

15 ‘‘(B) AUTHORIZATION.—Each report sub16 mitted under subparagraph (A) shall be author17 ized by a responsible official of the electric coal 

18 utility steam generating unit, who shall certify 

19 the accuracy of the report. 

20 ‘‘(C) PUBLIC REPORTING.—The Adminis21 trator shall make available to the public, 

22 through 1 or more published reports and 1 or 

23 more forms of electronic media, data concerning 

24 the emission of mercury from each electric coal 

25 utility steam generating unit.’’. 


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1 SEC. 5. EFFECT ON OTHER LAW. 

2 Except as specifically provided in this Act or an 

3 amendment made by this Act, nothing in this Act modifies 

4 or otherwise affects any authority or obligation set forth 

5 in the Clean Air Act (42 U.S.C. 7401 et seq.), including 

6 sections 110(a)(2)(D), 112, and 126 of that Act (42 

7 U.S.C. 7410(a)(2)(D), 7412, 7426). 

Æ 


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