§ 127.208. ERC use and transfer requirements.
The use and transfer of ERCs shall meet the following conditions:
(1) The registry system established by § 127.209 (relating to ERC registry system) shall be used to transfer ERCs, with the Department’s approval, directly from an existing source or facility where the ERCs were generated to the proposed facility.
(2) The transferee shall secure approval to use the offsetting ERCs through a plan approval or an operating permit, which indicates the Department’s approval of the ERC transfer and use. Upon the issuance of a plan approval or an operating permit, the ERCs are no longer subject to expiration under § 127.206(f) (relating to ERC general requirements) except as specified in § 127.206(g).
(3) For the pollutants regulated under this subchapter, the facility shall demonstrate to the satisfaction of the Department that the ERCs proposed for use as offsets will provide, at a minimum, ambient impact equivalence to the extent equivalence can be determined and that the use of the ERCs will not interfere with the overall control strategy of the SIP.
(4) ERCs shall include the same conditions, limitations and characteristics, including seasonal and other temporal variations in emission rate and quality, as well as the maximum allowable emission rates the emissions would have had if emitted by the generator, unless equivalent ambient impact is assured through other means.
(5) ERCs may be obtained from or traded in another state, which has reciprocity with the Commonwealth for the trading and use of ERCs, only upon the approval of both the Commonwealth and the other state through SIP approved rules and procedures, including an EPA approved SIP revision. ERCs generated in another state may not be traded into or used at a facility within this Commonwealth unless the ERC generating facility’s ERCs are enforceable by the Department.
(6) ERCs may not be transferred to and used in an area with a higher nonattainment classification than the one in which they were generated.
(7) A facility proposing new or increased emissions shall demonstrate that sufficient offsetting ERCs at the ratio specified in § 127.210 (relating to offset ratios) have been acquired from within the nonattainment area of the proposed facility.
(8) If the facility proposing new or increased emissions demonstrates that ERCs are not available in the nonattainment area where the facility is located, ERCs may be obtained from another nonattainment area if the other nonattainment area has an equal or higher classification and if the emissions from the other nonattainment area contribute to an NAAQS violation in the nonattainment area of the proposed facility. In addition, the requirements of paragraph (3) shall be satisfied.
(9) For the purpose of emissions offset transfers at VOC or NOx facilities, the areas included within an ozone transport region established under section 184 of the Clean Air Act (42 U.S.C.A. § 7511c), which are designated in 40 CFR 81.339 (relating to Pennsylvania) as attainment, nonattainment or unclassifiable areas for ozone, shall be treated as a single nonattainment area.
(10) An owner or operator of a facility shall acquire ERCs for use as offsets from an ERC generating facility located within the same nonattainment area.
(11) An owner or operator of a facility shall acquire ERCs for use as offsets from an ERC generating facility located within the same nonattainment area, except that the Department may allow the owner or operator to obtain ERCs generated in another nonattainment area if the following exist:
(i) The other area has an equal or higher nonattainment classification than the area in which the facility is located.
(ii) Emissions from the other area contribute to a violation of the NAAQS in the nonattainment area in which the facility is located.
(12) An owner or operator of a facility that is subject to allowance-based programs in this article may generate, create, transfer and use ERCs in accordance with this subchapter and applicable provisions in Chapter 145 (relating to interstate pollution transport reduction).
Source The provisions of this § 127.208 amended May 18, 2007, effective May 19, 2007, 37 Pa.B. 2365. Immediately preceding text appears at serial pages (221981) to (221982) and (289919).
Notes of Decisions Agency Interpretation
Because the Department of Environmental Protection is more likely to develop expertise in assessing the effect of regulatory interpretations than the Environmental Hearing Board, it is presumed that the General Assembly intended to invest the Department, and not the EHB, with authoritative interpretive powers. Department of Environmental Protection v. North American Refractories Co., 791 A.2d 461 (Pa. Cmwlth. 2002).
Commencement of Time
Although the interpretation of § 127.207(2) (relating to ERC generation and creation) that the commencement of the 1-year period for emissions begins to run at the initiation of emissions reduction rather that at the time the operator makes the decision to reduce emissions is reasonable, it was error not to consider whether that section is invalid because it is more stringent than Federal law. Department of Environmental Protection v. North American Refractories Co., 791 A.2d 461 (Pa. Cmwlth. 2002).
Cross References This section cited in 25 Pa. Code § 127.201 (relating to general requirements); and 25 Pa. Code § 127.209 (relating to ERC registry system).
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