42 U.S.C. § 7651c (THE PUBLIC HEALTH AND WELFARE)
§ 7651c. Phase I sulfur dioxide requirements
(a) Emission limitations
(1) After January 1, 1995, each source that includes one or more affected units listed in table A is an affected source under this section. After January 1, 1995, it shall be unlawful for any affected unit (other than an eligible phase I unit under subsection (d)(2) of this section) to emit sulfur dioxide in excess of the tonnage limitation stated as a total number of allowances in table A for phase I, unless (A) the emissions reduction requirements applicable to such unit have been achieved pursuant to subsection (b) or (d) of this section, or (B) the owner or operator of such unit holds allowances to emit not less than the unit’s total annual emissions, except that, after January 1, 2000, the emissions limitations established in this section shall be superseded by those established in section 7651d of this title. The owner or operator of any unit in violation of this section shall be fully liable for such violation including, but not limited to, liability for fulfilling the obligations specified in section 7651j of this title.
(2) Not later than December 31, 1991, the Administrator shall determine the total tonnage of reductions in the emissions of sulfur dioxide from all utility units in calendar year 1995 that will occur as a result of compliance with the emissions limitation requirements of this section, and shall establish a reserve of allowances equal in amount to the number of tons determined thereby not to exceed a total of 3.50 million tons. In making such a determination, the Administrator shall compute for each unit subject to the emissions limitation requirements of this section the difference between:
(A) the product of its baseline multiplied by the lesser of each unit’s allowable 1985 emissions rate and its actual 1985 emissions rate, divided by 2,000, and
(B) the product of each unit’s baseline multiplied by 2.50 lbs/mmBtu divided by 2,000,
and sum the computations. The Administrator shall adjust the foregoing calculation to reflect projected calendar year 1995 utilization of the units subject to the emissions limitations of this subchapter that the Administrator finds would have occurred in the absence of the imposition of such requirements. Pursuant to subsection (d) of this section, the Administrator shall allocate allowances from the reserve established hereinunder until the earlier of such time as all such allowances in the reserve are allocated or December 31, 1999.
(3) In addition to allowances allocated pursuant to paragraph (1), in each calendar year beginning in 1995 and ending in 1999, inclusive, the Administrator shall allocate for each unit on Table A that is located in the States of Illinois, Indiana, or Ohio (other than units at Kyger Creek, Clifty Creek and Joppa Steam), allowances in an amount equal to 200,000 multiplied by the unit’s pro rata share of the total number of allowances allocated for all units on Table A in the 3 States (other than units at Kyger Creek, Clifty Creek, and Joppa Steam) pursuant to paragraph (1). Such allowances shall be excluded from the calculation of the reserve under paragraph (2).
(b) Substitutions
The owner or operator of an affected unit under subsection (a) of this section may include in its section 7651g of this title permit application and proposed compliance plan a proposal to reassign, in whole or in part, the affected unit’s sulfur dioxide reduction requirements to any other unit(s) under the control of such owner or operator. Such proposal shall specify—
(1) the designation of the substitute unit or units to which any part of the reduction obligations of subsection (a) of this section shall be required, in addition to, or in lieu of, any original affected units designated under such subsection;
(2) the original affected unit’s baseline, the actual and allowable 1985 emissions rate for sulfur dioxide, and the authorized annual allowance allocation stated in table A;
(3) calculation of the annual average tonnage for calendar years 1985, 1986, and 1987, emitted by the substitute unit or units, based on the baseline for each unit, as defined in section 7651a(d) 1 of this title, multiplied by the lesser of the unit’s actual or allowable 1985 emissions rate;
(4) the emissions rates and tonnage limitations that would be applicable to the original and substitute affected units under the substitution proposal;
(5) documentation, to the satisfaction of the Administrator, that the reassigned tonnage limits will, in total, achieve the same or greater emissions reduction than would have been achieved by the original affected unit and the substitute unit or units without such substitution; and
(6) such other information as the Administrator may require.
(c) Administrator’s action on substitution proposals
(1) The Administrator shall take final action on such substitution proposal in accordance with section 7651g(c) of this title if the substitution proposal fulfills the requirements of this subsection. The Administrator may approve a substitution proposal in whole or in part and with such modifications or conditions as may be consistent with the orderly functioning of the allowance system and which will ensure the emissions reductions contemplated by this subchapter. If a proposal does not meet the requirements of subsection (b) of this section, the Administrator shall disapprove it. The owner or operator of a unit listed in table A shall not substitute another unit or units without the prior approval of the Administrator.
(2) Upon approval of a substitution proposal, each substitute unit, and each source with such unit, shall be deemed affected under this subchapter, and the Administrator shall issue a permit to the original and substitute affected source and unit in accordance with the approved substitution plan and section 7651g of this title. The Administrator shall allocate allowances for the original and substitute affected units in accordance with the approved substitution proposal pursuant to section 7651b of this title. It shall be unlawful for any source or unit that is allocated allowances pursuant to this section to emit sulfur dioxide in excess of the emissions limitation provided for in the approved substitution permit and plan unless the owner or operator of each unit governed by the permit and approved substitution plan holds allowances to emit not less than the units 2 total annual emissions. The owner or operator of any original or substitute affected unit operated in violation of this subsection shall be fully liable for such violation, including liability for fulfilling the obligations specified in section 7651j of this title. If a substitution proposal is disapproved, the Administrator shall allocate allowances to the original affected unit or units in accordance with subsection (a) of this section.
(d) Eligible phase I extension units
(1) The owner or operator of any affected unit subject to an emissions limitation requirement under this section may petition the Administrator in its permit application under section 7651g of this title for an extension of 2 years of the deadline for meeting such requirement, provided that the owner or operator of any such unit holds allowances to emit not less than the unit’s total annual emissions for each of the 2 years of the period of extension. To qualify for such an extension, the affected unit must either employ a qualifying phase I technology, or transfer its phase I emissions reduction obligation to a unit employing a qualifying phase I technology. Such transfer shall be accomplished in accordance with a compliance plan, submitted and approved under section 7651g of this title, that shall govern operations at all units included in the transfer, and that specifies the emissions reduction requirements imposed pursuant to this subchapter.
(2) Such extension proposal shall—
(A) specify the unit or units proposed for designation as an eligible phase I extension unit;
(B) provide a copy of an executed contract, which may be contingent upon the Administrator approving the proposal, for the design engineering, and construction of the qualifying phase I technology for the extension unit, or for the unit or units to which the extension unit’s emission reduction obligation is to be transferred;
(C) specify the unit’s or units’ baseline, actual 1985 emissions rate, allowable 1985 emissions rate, and projected utilization for calendar years 1995 through 1999;
(D) require CEMS on both the eligible phase I extension unit or units and the transfer unit or units beginning no later than January 1, 1995; and
(E) specify the emission limitation and number of allowances expected to be necessary for annual operation after the qualifying phase I technology has been installed.
(3) The Administrator shall review and take final action on each extension proposal in order of receipt, consistent with section 7651g of this title, and for an approved proposal shall designate the unit or units as an eligible phase I extension unit. The Administrator may approve an extension proposal in whole or in part, and with such modifications or conditions as may be necessary, consistent with the orderly functioning of the allowance system, and to ensure the emissions reductions contemplated by the 3 subchapter.
(4) In order to determine the number of proposals eligible for allocations from the reserve under subsection (a)(2) of this section and the number of allowances remaining available after each proposal is acted upon, the Administrator shall reduce the total number of allowances remaining available in the reserve by the number of allowances calculated according to subparagraphs (A), (B) and (C) until either no allowances remain available in the reserve for further allocation or all approved proposals have been acted upon. If no allowances remain available in the reserve for further allocation before all proposals have been acted upon by the Administrator, any pending proposals shall be disapproved. The Administrator shall calculate allowances equal to—
(A) the difference between the lesser of the average annual emissions in calendar years 1988 and 1989 or the projected emissions tonnage for calendar year 1995 of each eligible phase I extension unit, as designated under paragraph (3), and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/mmBtu, divided by 2,000;
(B) the difference between the lesser of the average annual emissions in calendar years 1988 and 1989 or the projected emissions tonnage for calendar year 1996 of each eligible phase I extension unit, as designated under paragraph (3), and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/mmBtu, divided by 2,000; and
(C) the amount by which (i) the product of each unit’s baseline multiplied by an emission rate of 1.20 lbs/mmBtu, divided by 2,000, exceeds (ii) the tonnage level specified under subparagraph (E) of paragraph (2) of this subsection multiplied by a factor of 3.
(5) Each eligible Phase I extension unit shall receive allowances determined under subsection (a)(1) or (c) of this section. In addition, for calendar year 1995, the Administrator shall allocate to each eligible Phase I extension unit, from the allowance reserve created pursuant to subsection (a)(2) of this section, allowances equal to the difference between the lesser of the average annual emissions in calendar years 1988 and 1989 or its projected emissions tonnage for calendar year 1995 and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/mmBtu, divided by 2,000. In calendar year 1996, the Administrator shall allocate for each eligible unit, from the allowance reserve created pursuant to subsection (a)(2) of this section, allowances equal to the difference between the lesser of the average annual emissions in calendar years 1988 and 1989 or its projected emissions tonnage for calendar year 1996 and the product of the unit’s baseline multiplied by an emission rate of 2.50 lbs/mmBtu, divided by 2,000. It shall be unlawful for any source or unit subject to an approved extension plan under this subsection to emit sulfur dioxide in excess of the emissions limitations provided for in the permit and approved extension plan, unless the owner or operator of each unit governed by the permit and approved plan holds allowances to emit not less than the unit’s total annual emissions.
(6) In addition to allowances specified in paragraph (5), the Administrator shall allocate for each eligible Phase I extension unit employing qualifying Phase I technology, for calendar years 1997, 1998, and 1999, additional allowances, from any remaining allowances in the reserve created pursuant to subsection (a)(2) of this section, following the reduction in the reserve provided for in paragraph (4), not to exceed the amount by which (A) the product of each eligible unit’s baseline times an emission rate of 1.20 lbs/mmBtu, divided by 2,000, exceeds (B) the tonnage level specified under subparagraph (E) of paragraph (2) of this subsection.
(7) After January 1, 1997, in addition to any liability under this chapter, including under section 7651j of this title, if any eligible phase I extension unit employing qualifying phase I technology or any transfer unit under this subsection emits sulfur dioxide in excess of the annual tonnage limitation specified in the extension plan, as approved in paragraph (3) of this subsection, the Administrator shall, in the calendar year following such excess, deduct allowances equal to the amount of such excess from such unit’s annual allowance allocation.
(e) Allocation of allowances
(1) In the case of a unit that receives authorization from the Governor of the State in which such unit is located to make reductions in the emissions of sulfur dioxide prior to calendar year 1995 and that is part of a utility system that meets the following requirements: (A) the total coal-fired generation within the utility system as a percentage of total system generation decreased by more than 20 percent between January 1, 1980, and December 31, 1985; and (B) the weighted capacity factor of all coal-fired units within the utility system averaged over the period from January 1, 1985, through December 31, 1987, was below 50 percent, the Administrator shall allocate allowances under this paragraph for the unit pursuant to this subsection. The Administrator shall allocate allowances for a unit that is an affected unit pursuant to section 7651d of this title (but is not also an affected unit under this section) and part of a utility system that includes 1 or more affected units under section 7651d of this title for reductions in the emissions of sulfur dioxide made during the period 1995–1999 if the unit meets the requirements of this subsection and the requirements of the preceding sentence, except that for the purposes of applying this subsection to any such unit, the prior year concerned as specified below, shall be any year after January 1, 1995 but prior to January 1, 2000.
(2) In the case of an affected unit under this section described in subparagraph (A),4 the allowances allocated under this subsection for early reductions in any prior year may not exceed the amount which (A) the product of the unit’s baseline multiplied by the unit’s 1985 actual sulfur dioxide emission rate (in lbs. per mmBtu), divided by 2,000, exceeds (B) the allowances specified for such unit in Table A. In the case of an affected unit under section 7651d of this title described in subparagraph (A),4 the allowances awarded under this subsection for early reductions in any prior year may not exceed the amount by which (i) the product of the quantity of fossil fuel consumed by the unit (in mmBtu) in the prior year multiplied by the lesser of 2.50 or the most stringent emission rate (in lbs. per mmBtu) applicable to the unit under the applicable implementation plan, divided by 2,000, exceeds (ii) the unit’s actual tonnage of sulfur dioxide emission for the prior year concerned. Allowances allocated under this subsection for units referred to in subparagraph (A) 4 may be allocated only for emission reductions achieved as a result of physical changes or changes in the method of operation made after November 15, 1990, including changes in the type or quality of fossil fuel consumed.
(3) In no event shall the provisions of this paragraph 5 be interpreted as an event of force majeur 6 or a commercial impractibility 7 or in any other way as a basis for excused nonperformance by a utility system under a coal sales contract in effect before November 15, 1990.
Table A.—Affected Sources and Units in Phase I and Their Sulfur Dioxide Allowances (tons)
State
Plant Name
Generator
Phase I Allowances
Alabama
Colbert
1
2
3
4
5
13,570
15,310
15,400
15,410
37,180
E.C. Gaston
1
2
3
4
5
18,100
18,540
18,310
19,280
59,840
Florida
Big Bend
1
2
3
28,410
27,100
26,740
Crist
6
7
19,200
31,680
Georgia
Bowen
1
2
3
4
56,320
54,770
71,750
71,740
Hammond
1
2
3
4
8,780
9,220
8,910
37,640
J. McDonough
1
2
19,910
20,600
Wansley
1
2
70,770
65,430
Yates
1
2
3
4
5
6
7
7,210
7,040
6,950
8,910
9,410
24,760
21,480
Illinois
Baldwin
1
2
3
42,010
44,420
42,550
Coffeen
1
2
11,790
35,670
Grand Tower
4
5,910
Hennepin
2
18,410
Joppa Steam
1
2
3
4
5
6
12,590
10,770
12,270
11,360
11,420
10,620
Kincaid
1
2
31,530
33,810
Meredosia
3
13,890
Vermilion
2
8,880
Indiana
Bailly
7
8
11,180
15,630
Breed
1
18,500
Cayuga
1
2
33,370
34,130
Clifty Creek
1
2
3
4
5
6
20,150
19,810
20,410
20,080
19,360
20,380
E. W. Stout
5
6
7
3,880
4,770
23,610
F. B. Culley
2
3
4,290
16,970
F. E. Ratts
1
2
8,330
8,480
Gibson
1
2
3
4
40,400
41,010
41,080
40,320
H. T. Pritchard
6
5,770
Michigan City
12
23,310
Petersburg
1
2
16,430
32,380
R. Gallagher
1
2
3
4
6,490
7,280
6,530
7,650
Tanners Creek
4
24,820
Wabash River
1
2
3
5
6
4,000
2,860
3,750
3,670
12,280
Warrick
4
26,980
Iowa
Burlington
1
10,710
Des Moines
7
2,320
George Neal
1
1,290
M.L. Kapp
2
13,800
Prairie Creek
4
8,180
Riverside
5
3,990
Kansas
Quindaro
2
4,220
Kentucky
Coleman
1
2
3
11,250
12,840
12,340
Cooper
1
2
7,450
15,320
E.W. Brown
1
2
3
7,110
10,910
26,100
Elmer Smith
1
2
6,520
14,410
Ghent
1
28,410
Green River
4
7,820
H.L. Spurlock
1
22,780
Henderson II
1
2
13,340
12,310
Paradise
3
59,170
Shawnee
10
10,170
Maryland
Chalk Point
1
2
21,910
24,330
C. P. Crane
1
2
10,330
9,230
Morgantown
1
2
35,260
38,480
Michigan
J. H. Campbell
1
2
19,280
23,060
Minnesota
High Bridge
6
4,270
Mississippi
Jack Watson
4
5
17,910
36,700
Missouri
Asbury
1
16,190
James River
5
4,850
Labadie
1
2
3
4
40,110
37,710
40,310
35,940
Montrose
1
2
3
7,390
8,200
10,090
New Madrid
1
2
28,240
32,480
Sibley
3
15,580
Sioux
1
2
22,570
23,690
Thomas Hill
1
2
10,250
19,390
New Hampshire
Merrimack
1
2
10,190
22,000
New Jersey
B.L. England
1
2
9,060
11,720
New York
Dunkirk
3
4
12,600
14,060
Greenidge
4
7,540
Milliken
1
2
11,170
12,410
Northport
1
2
3
19,810
24,110
26,480
Port Jefferson
3
4
10,470
12,330
Ohio
Ashtabula
5
16,740
Avon Lake
8
9
11,650
30,480
Cardinal
1
2
34,270
38,320
Conesville
1
2
3
4
4,210
4,890
5,500
48,770
Eastlake
1
2
3
4
5
7,800
8,640
10,020
14,510
34,070
Edgewater
4
5,050
Gen. J.M. Gavin
1
2
79,080
80,560
Kyger Creek
1
2
3
4
5
19,280
18,560
17,910
18,710
18,740
Miami Fort
5
6
7
760
11,380
38,510
Muskingum River
1
2
3
4
5
14,880
14,170
13,950
11,780
40,470
Niles
1
2
6,940
9,100
Picway
5
4,930
R.E. Burger
3
4
5
6,150
10,780
12,430
W.H. Sammis
5
6
7
24,170
39,930
43,220
W.C. Beckjord
5
6
8,950
23,020
Pennsylvania
Armstrong
1
2
14,410
15,430
Brunner Island
1
2
3
27,760
31,100
53,820
Cheswick
1
39,170
Conemaugh
1
2
59,790
66,450
Hatfield’s Ferry
1
2
3
37,830
37,320
40,270
Martins Creek
1
2
12,660
12,820
Portland
1
2
5,940
10,230
Shawville
1
2
3
4
10,320
10,320
14,220
14,070
Sunbury
3
4
8,760
11,450
Tennessee
Allen
1
2
3
15,320
16,770
15,670
Cumberland
1
2
86,700
94,840
Gallatin
1
2
3
4
17,870
17,310
20,020
21,260
Johnsonville
1
2
3
4
5
6
7
8
9
10
7,790
8,040
8,410
7,990
8,240
7,890
8,980
8,700
7,080
7,550
West Virginia
Albright
3
12,000
Fort Martin
1
2
41,590
41,200
Harrison
1
2
3
48,620
46,150
41,500
Kammer
1
2
3
18,740
19,460
17,390
Mitchell
1
2
43,980
45,510
Mount Storm
1
2
3
43,720
35,580
42,430
Wisconsin
Edgewater
4
24,750
La Crosse/Genoa
3
22,700
Nelson Dewey
1
2
6,010
6,680
N. Oak Creek
1
2
3
4
5,220
5,140
5,370
6,320
Pulliam
8
7,510
S. Oak Creek
5
6
7
8
9,670
12,040
16,180
15,790
(f) Energy conservation and renewable energy
(1) Definitions
As used in this subsection:
(A) Qualified energy conservation measure
The term “qualified energy conservation measure” means a cost effective measure, as identified by the Administrator in consultation with the Secretary of Energy, that increases the efficiency of the use of electricity provided by an electric utility to its customers.
(B) Qualified renewable energy
The term “qualified renewable energy” means energy derived from biomass, solar, geothermal, or wind as identified by the Administrator in consultation with the Secretary of Energy.
(C) Electric utility
The term “electric utility” means any person, State agency, or Federal agency, which sells electric energy.
(2) Allowances for emissions avoided through energy conservation and renewable energy
(A) In general
The regulations under paragraph (4) of this subsection shall provide that for each ton of sulfur dioxide emissions avoided by an electric utility, during the applicable period, through the use of qualified energy conservation measures or qualified renewable energy, the Administrator shall allocate a single allowance to such electric utility, on a first-come-first-served basis from the Conservation and Renewable Energy Reserve established under subsection (g) of this section, up to a total of 300,000 allowances for allocation from such Reserve.
(B) Requirements for issuance
The Administrator shall allocate allowances to an electric utility under this subsection only if all of the following requirements are met:
(i) Such electric utility is paying for the qualified energy conservation measures or qualified renewable energy directly or through purchase from another person.
(ii) The emissions of sulfur dioxide avoided through the use of qualified energy conservation measures or qualified renewable energy are quantified in accordance with regulations promulgated by the Administrator under this subsection.
(iii)
(I) Such electric utility has adopted and is implementing a least cost energy conservation and electric power plan which evaluates a range of resources, including new power supplies, energy conservation, and renewable energy resources, in order to meet expected future demand at the lowest system cost.
(II) The qualified energy conservation measures or qualified renewable energy, or both, are consistent with that plan.
(III) Electric utilities subject to the jurisdiction of a State regulatory authority must have such plan approved by such authority. For electric utilities not subject to the jurisdiction of a State regulatory authority such plan shall be approved by the entity with rate-making authority for such utility.
(iv) In the case of qualified energy conservation measures undertaken by a State regulated electric utility, the Secretary of Energy certifies that the State regulatory authority with jurisdiction over the electric rates of such electric utility has established rates and charges which ensure that the net income of such electric utility after implementation of specific cost effective energy conservation measures is at least as high as such net income would have been if the energy conservation measures had not been implemented. Upon the date of any such certification by the Secretary of Energy, all allowances which, but for this paragraph, would have been allocated under subparagraph (A) before such date, shall be allocated to the electric utility. This clause is not a requirement for qualified renewable energy.
(v) Such utility or any subsidiary of the utility’s holding company owns or operates at least one affected unit.
(C) Period of applicability
Allowances under this subsection shall be allocated only with respect to kilowatt hours of electric energy saved by qualified energy conservation measures or generated by qualified renewable energy after January 1, 1992 and before the earlier of (i) December 31, 2000, or (ii) the date on which any electric utility steam generating unit owned or operated by the electric utility to which the allowances are allocated becomes subject to this subchapter (including those sources that elect to become affected by this subchapter, pursuant to section 7651i of this title).
(D) Determination of avoided emissions
(i) Application
In order to receive allowances under this subsection, an electric utility shall make an application which—
(I) designates the qualified energy conservation measures implemented and the qualified renewable energy sources used for purposes of avoiding emissions,8
(II) calculates, in accordance with subparagraphs (F) and (G), the number of tons of emissions avoided by reason of the implementation of such measures or the use of such renewable energy sources; and
(III) demonstrates that the requirements of subparagraph (B) have been met.
Such application for allowances by a State-regulated electric utility shall require approval by the State regulatory authority with jurisdiction over such electric utility. The authority shall review the application for accuracy and compliance with this subsection and the rules under this subsection. Electric utilities whose retail rates are not subject to the jurisdiction of a State regulatory authority shall apply directly to the Administrator for such approval.
(E) Avoided emissions from qualified energy conservation measures
For the purposes of this subsection, the emission tonnage deemed avoided by reason of the implementation of qualified energy conservation measures for any calendar year shall be a tonnage equal to the product of multiplying—
(i) the kilowatt hours that would otherwise have been supplied by the utility during such year in the absence of such qualified energy conservation measures, by
(ii) 0.004,
and dividing by 2,000.
(F) Avoided emissions from the use of qualified renewable energy
The emissions tonnage deemed avoided by reason of the use of qualified renewable energy by an electric utility for any calendar year shall be a tonnage equal to the product of multiplying—
(i) the actual kilowatt hours generated by, or purchased from, qualified renewable energy, by
(ii) 0.004,
and dividing by 2,000.
(G) Prohibitions
(i) No allowances shall be allocated under this subsection for the implementation of programs that are exclusively informational or educational in nature.
(ii) No allowances shall be allocated for energy conservation measures or renewable energy that were operational before January 1, 1992.
(3) Savings provision
Nothing in this subsection precludes a State or State regulatory authority from providing additional incentives to utilities to encourage investment in demand-side resources.
(4) Regulations
Not later than 18 months after November 15, 1990, and in conjunction with the regulations required to be promulgated under subsections (b) and (c) of this section, the Administrator shall, in consultation with the Secretary of Energy, promulgate regulations under this subsection. Such regulations shall list energy conservation measures and renewable energy sources which may be treated as qualified energy conservation measures and qualified renewable energy for purposes of this subsection. Allowances shall only be allocated if all requirements of this subsection and the rules promulgated to implement this subsection are complied with. The Administrator shall review the determinations of each State regulatory authority under this subsection to encourage consistency from electric utility to electric utility and from State to State in accordance with the Administrator’s rules. The Administrator shall publish the findings of this review no less than annually.
(g) Conservation and Renewable Energy Reserve
The Administrator shall establish a Conservation and Renewable Energy Reserve under this subsection. Beginning on January 1, 1995, the Administrator may allocate from the Conservation and Renewable Energy Reserve an amount equal to a total of 300,000 allowances for emissions of sulfur dioxide pursuant to section 7651b of this title. In order to provide 300,000 allowances for such reserve, in each year beginning in calendar year 2000 and until calendar year 2009, inclusive, the Administrator shall reduce each unit’s basic Phase II allowance allocation on the basis of its pro rata share of 30,000 allowances. If allowances remain in the reserve after January 2, 2010, the Administrator shall allocate such allowances for affected units under section 7651d of this title on a pro rata basis. For purposes of this subsection, for any unit subject to the emissions limitation requirements of section 7651d of this title, the term “pro rata basis” refers to the ratio which the reductions made in such unit’s allowances in order to establish the reserve under this subsection bears to the total of such reductions for all such units.
(h) Alternative allowance allocation for units in certain utility systems with optional baseline
(1) Optional baseline for units in certain systems
In the case of a unit subject to the emissions limitation requirements of this section which (as of November 15, 1990)—
(A) has an emission rate below 1.0 lbs/mmBtu,
(B) has decreased its sulfur dioxide emissions rate by 60 percent or greater since 1980, and
(C) is part of a utility system which has a weighted average sulfur dioxide emissions rate for all fossil fueled-fired units below 1.0 lbs/mmBtu,
at the election of the owner or operator of such unit, the unit’s baseline may be calculated (i) as provided under section 7651a(d) 9 of this title, or (ii) by utilizing the unit’s average annual fuel consumption at a 60 percent capacity factor. Such election shall be made no later than March 1, 1991.
(2) Allowance allocation
Whenever a unit referred to in paragraph (1) elects to calculate its baseline as provided in clause (ii) of paragraph (1), the Administrator shall allocate allowances for the unit pursuant to section 7651b(a)(1) of this title, this section, and section 7651d of this title (as basic Phase II allowance allocations) in an amount equal to the baseline selected multiplied by the lower of the average annual emission rate for such unit in 1989, or 1.0 lbs./mmBtu. Such allowance allocation shall be in lieu of any allocation of allowances under this section and section 7651d of this title.
(July 14, 1955, ch. 360, title IV, § 404, as added Pub. L. 101–549, title IV, § 401, Nov. 15, 1990, 104 Stat. 2592.)