§ 145.54. 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 meet the following conditions:
(1) The allowances are allocated for a control period in a prior year or the same year.
(2) The allowances 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 § 145.60 (relating to submission of NOx allowance transfers) by the NOx allowance transfer deadline for that control period.
(b) Deductions for compliance.
(1) Following the recordation, in accordance with § 145.61 (relating to NOx transfer recordation), 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 NOx Budget Administrator will deduct NOx allowances available under subsection (a) to cover the unit’s NOx emissions (as determined in accordance with § § 145.70—145.76 (relating to recordkeeping and reporting requirements)), or to account for actual heat input under § 145.42(e) (relating to NOx allowance allocations), for the control period:
(i) From the compliance account.
(ii) Only if no more NOx allowances available under subsection (a) remain in the compliance account, from the overdraft account. In deducting allowances for units at the source from the overdraft account, the NOx Budget 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) NOx allowances will be deducted first under subparagraph (i) and then under subparagraph (ii):
(i) Until the number of NOx allowances deducted for the control period equals the number of tons of NOx emissions, determined in accordance with § § 145.70—145.76, from the unit for the control period for which compliance is being determined, plus the number of NOx allowances required for deduction to account for actual heat input under § 145.42(e) for the control period.
(ii) Until no more NOx allowances available under subsection (a) remain in the respective account.
(c) Allowance identification.
(1) Identification of NOx allowances by serial number. 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 subsection (b), (d), (e) or (f). The identification shall be made in the compliance certification report submitted in accordance with § 145.30 (relating to compliance certification report).
(2) First-in, first-out. NOx allowances will be deducted 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 (1), or the overdraft account on a first-in, first-out (FIFO) accounting basis in the following order:
(i) Those NOx allowances that were allocated for the control period to the unit under § § 145.40—145.43 or § § 145.80—145.88 (relating to NOx allowance allocations; and opt-in process).
(ii) Those NOx allowances that were allocated for the control period to any unit and transferred and recorded in the account under § § 145.60—145.62 (relating to NOx allowance transfers), in order of their date of recordation.
(iii) Those NOx allowances that were allocated for a prior control period to the unit under § § 145.40—145.43 or § § 145.80—145.88.
(iv) Those NOx allowances that were allocated for a prior control period to any unit and transferred and recorded in the account under § § 145.60—145.62, in order of their date of recordation.
(d) Deductions for excess emissions.
(1) After making the deductions for compliance under subsection (b), the NOx Budget 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 NOx Budget 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) An allowance deduction required under subsection (d) does not affect the liability of the owners and operators 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 the act. The following guidelines will be followed in assessing fines, penalties or other obligations:
(i) 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.
(ii) 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 § § 145.70—145.76:
(1) The NOx authorized account representative of the units may identify the percentage of NOx allowances to be deducted from each unit’s compliance account to cover the unit’s share of NOx emissions from the common stack for a control period. The identification shall be made in the compliance certification report submitted in accordance with § 145.30.
(2) Notwithstanding subsection (b)(2)(i), the NOx Budget Administrator will deduct NOx allowances for each unit until the number of NOx allowances deducted equals the unit’s identified percentage (under paragraph (1)) of the number of tons of NOx emissions, as determined in accordance with § § 145.70—145.76, 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 unit, plus the number of allowances required for deduction to account for actual heat input under § 145.42(e) for the control period.
(f) Deduction of banked allowances. Each year starting in 2005, after the NOx Budget Administrator has completed the designation of banked allowances under § 145.55(b) (relating to banking) and before May 1 of the year, the NOx Budget Administrator will determine the extent to which banked NOx allowances otherwise available under subsection (a) are available for compliance in the control period for the current year as follows:
(1) The NOx Budget 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 (1), to be held in compliance accounts, overdraft accounts or general accounts is less than or equal to 10% of the sum of the trading program budgets under § 145.40 (relating to State Trading Program budget) for all states for the control period, any banked NOx allowance may be deducted for compliance in accordance with subsections (a)—(e).
(3) If the total number of banked NOx allowances determined, under paragraph (1) to be held in compliance accounts, overdraft accounts or general accounts exceeds 10% of the sum of the trading program budgets under § 145.40 for Pennsylvania and the trading program budgets approved by the administrator for other states participating in the NOx budget trading program for the control period, any banked allowance may be deducted for compliance in accordance with subsections (a)—(e), except as follows:
(i) The NOx Budget Administrator will determine the following ratio: 0.10 multiplied by the sum of the trading program budgets under § 145.40 for all states for the control period and divided by the total number of banked NOx allowances determined, under paragraph (1), to be held in compliance accounts, overdraft accounts, or general accounts.
(ii) The NOx Budget Administrator will multiply the number of banked NOx allowances in each compliance account or overdraft account by the ratio determined under subparagraph (i). The resulting product is the number of banked NOx allowances in the account that may be deducted for compliance in accordance with subsections (a)—(e), except that, if the NOx allowances are used to make a deduction under subsection (b) or (e), two (rather than one), these NOx allowances shall authorize up to 1 ton of NOx emissions during the control period and shall be deducted for each deduction of one NOx allowance required under subsection (b) or (e).
(g) The NOx Budget Administrator will record in the appropriate compliance account or overdraft account all deductions from the account under subsection (b), (d) or (f).
Cross References This section cited in 25 Pa. Code § 123.121 (relating to NOx Allowance Program transition); 25 Pa. Code § 145.2 (relating to definitions); 25 Pa. Code § 145.4 (relating to applicability); 25 Pa. Code § 145.5 (relating to retired unit exemption); 25 Pa. Code § 145.30 (relating to compliance certification report); 25 Pa. Code § 145.42 (relating to NOx allowance allocations); 25 Pa. Code § 145.43 (relating to compliance supplement budget); 25 Pa. Code § 145.50 (relating to NOx Allowance Tracking System accounts); 25 Pa. Code § 145.53 (relating to recordation of NOx allowance allocations); 25 Pa. Code § 145.55 (relating to banking); 25 Pa. Code § 145.81 (relating to opt-in source general provisions); 25 Pa. Code § 145.86 (relating to opt-in source withdrawal from NOx Budget Trading Program); and 25 Pa. Code § 145.87 (relating to opt-in unit change in regulatory status).
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