Section 432.04. Compliance supplement pool.

  In addition to the CAIR NO x allowances allocated under s. NR 432.03 , the department may allocate for calendar year 2009 only, additional allowances from the compliance supplement pool up to the amount designated by the EPA in 40 CFR 97.143 for Wisconsin for the purposes identified in this section.

(1)   Early reduction credits.

(a) The department may allocate CAIR NO x allowances from the compliance supplement pool to a CAIR NO x unit if the unit's CAIR designated representative demonstrates that it achieved early reductions of NO x emissions. To be eligible for early reduction credits, the unit's CAIR designated representative shall demonstrate all of the following:

1. The CAIR NO x unit's average annual NO x emission rate for 2007 or 2008 is less than 0.25 lb/mmBtu based on heat input.

2. If the unit is included in a NO x averaging plan under s. NR 409.065 (7) for 2007 or 2008, the NO x averaging plan has an actual weighted average NO x emission rate for 2007 or 2008 equal to or less than the actual weighted average NO x emission rate for preceding year.

3. Compared to the preceding year, the CAIR NO x unit achieves NO x emission reductions in both 2007 and 2008.

(b) The CAIR designated representative of the unit may request early reduction credits, and allocation of CAIR NO x allowances from the compliance supplement pool for early reduction credits, in accordance with the following:

1. The CAIR designated representative shall monitor and report the NO x emissions rate and the heat input of the unit based on monitoring data required in accordance with 40 CFR part 97 , Subpart HH in each calendar year for which early reduction credits are requested.

2. The CAIR designated representative of a CAIR NO x unit shall submit to the department by July 31, 2009 a request for allocation of an amount of CAIR NO x allowances from the compliance supplement pool. The request may not exceed the value determined using equation 6:

- See PDF for diagram

Equation 6

where:

ER is the amount of CAIR NO x allowances a CAIR designated representative may request based on early emission reductions in 2007 and 2008 rounded to the nearest ton

HI 2007 is the total heat input to the unit for the calendar year 2007 in mmBtu

HI 2008 is the total heat input to the unit for the calendar year 2008 in mmBtu

2000 is a conversion factor in lb/ton

D EM 2007 and D EM 2008 are the differences between the actual emission rates for 2007 and 2008 respectively and the target emission rate for early reductions in lbs NO x /mmBtu. If the unit's actual average emission rate for the calendar year is greater than 0.25, D EM year is equal to 0. If the unit's actual average emission rate for the calendar year is equal to or less than 0.25, then D EM year is calculated using equation 7

- See PDF for diagram Equation 7

where:

Actual year is the unit's actual average emission rate for calendar year for 2007 or 2008 in lbs NO x /mmBtu determined in accordance with 40 CFR part 97 , Subpart HH

0.25 is the target emission rate for early reductions in lbs NO x /mmBtu

(2)   Electric reliability. The department may allocate CAIR NO x allowances from the compliance supplement pool to any CAIR NO x unit for which the unit's CAIR designated representative demonstrates that compliance with the CAIR NO x allocation under s. NR 432.03 , Table 1 for calendar year 2009 would create an undue risk to the reliability of electricity supply during 2009. The CAIR designated representative of the unit may request the allocation of CAIR NO x allowances from the compliance supplement pool in order to avoid an undue risk to the reliability of electricity supply during 2009 in accordance with the following requirements:

(a) The CAIR designated representative of the CAIR NO x unit shall submit to the department by July 31, 2009 a request for allocation of an amount of CAIR NO x allowances from the compliance supplement pool not exceeding the minimum amount of CAIR NO x allowances necessary to remove the undue risk to the reliability of electricity supply.

(b) In the request under par. (a) , the CAIR designated representative of the CAIR NO x unit shall demonstrate that, in the absence of an allocation to the unit in the amount of CAIR NO x allowances requested, the unit's compliance with CAIR NO x allocation under s. NR 432.03 , Table 1 for calendar year 2009 would create an undue risk to the reliability of electricity supply during that year. This demonstration shall include a showing by the unit's CAIR designated representative that it would not be feasible to do both of the following:

1. Obtain a sufficient amount of electricity from other electricity generation facilities for compliance with the CAIR NO x allocations under s. NR 432.03 , Table 1 to prevent the undue risk.

2. Obtain under subs. (1) and (3) , or otherwise obtain, a sufficient amount of CAIR NO x allowances to prevent the undue risk.

(3)   Allocation procedure. The department shall review each request submitted under subs. (1) and (2) and shall allocate CAIR NO x allowances for calendar year 2009 to CAIR NO x units covered by the requests as follows:

(a) Upon receipt of each request, the department shall determine whether the amount of the CAIR NO x allowances requested from the compliance supplement pool meets the requirements of sub. (1) or (2) .

(b) If the amount of CAIR NO x allowances in the compliance supplement pool is greater than or equal to the total amount of CAIR NO x allowances in all requests submitted under subs. (1) and (2) , the department shall allocate to each CAIR NO x unit covered by the requests the amount of CAIR NO x allowances requested, and determined eligible for under par. (a) .

(c) If the state's compliance supplement pool has a smaller amount of CAIR NO x allowances than the total amount of CAIR NO x allowances in all requests submitted under subs. (1) and (2) , as adjusted under par. (a) , the department shall allocate CAIR NO x allowances to each CAIR NO x unit covered by the requests according to equation 8:

- See PDF for diagram Equation 8

where:

Z i is the amount of CAIR NO x allowances allocated to unit i from the state's compliance supplement pool rounded to the nearest whole ton, adjusted by the department as needed to ensure that the sum of the allowances to all units does not exceed the CSP

Y i is the amount of CAIR NO x allowances requested for unit i under subs. (1) and (2) , as determined eligible under par. (a)

CSP is the amount of CAIR NO x allowances in the state's compliance supplement pool as provided in 40 CFR 97.143

k is the number of units which the department deemed eligible for requests made under subs. (1) and (2)

(d) By November 15, 2009, the department shall determine the allocations under par. (b) or (c) , as applicable. The department shall make available to the public each determination of CAIR NO x allowances under par. (c) and shall provide an opportunity for submission of objections to the determination. Objections shall be limited to addressing whether the determination is in accordance with sub. (1) or (2) and par. (b) or (c) and data correction. Based on any objections, the department may adjust each determination to the extent necessary to ensure that it is in accordance with sub. (1) or (2) and par. (b) or (c) and the data is correct.

(e) By December 15, 2009, the department shall notify the administrator of the allocations made under par. (d) .

History: CR 06-104 : cr. Register July 2007 No. 619 , eff. 8-1-07.