allowance transfer deadline for such control period and include, in a
format prescribed by the Administrator, the identification of the TR
SO2 Group 1 source and the appropriate serial numbers.
    (2) First-in, first-out. The Administrator will deduct TR
SO2 Group 1 allowances under paragraph (b) or (d) of this
section from the source's compliance account in accordance with a
complete request under paragraph (c)(1) of this section or, in the
absence of such request or in the case of identification of an
insufficient amount of TR SO2 Group 1 allowances in such
request, on a first-in, first-out accounting basis in the following
order:
    (i) Any TR SO2 Group 1 allowances that were allocated to
the units at the source and not transferred out of the compliance
account, in the order of recordation; and then
    (ii) Any TR SO2 Group 1 allowances that were allocated
to any unit and transferred to and recorded in the compliance account
pursuant to this subpart, in the order of recordation.
    (d) Deductions for excess emissions. After making the deductions
for compliance under paragraph (b) of this section for a control period
in a year in which the TR SO2 Group 1 source has excess
emissions, the Administrator will deduct from the source's compliance
account an amount of TR SO2 Group 1 allowances, allocated
for a control period in a prior year or the control period in the year
of the excess emissions or in the immediately following year, equal to
two times the number of tons of the source's excess emissions.
    (e) Recordation of deductions. The Administrator will record in the
appropriate compliance account all deductions from such an account
under paragraphs (b) and (d) of this section.

Sec.  97.625  Compliance with TR SO2 Group 1 assurance provisions.

    (a) Availability for deduction. TR SO2 Group 1
allowances are available to be deducted for compliance with the TR
SO2 Group 1 assurance provisions for a control period in a
given year by the owners and operators of a group of one or more TR
SO2 Group 1 sources and units in a State (and Indian country
within the borders of such State) only if the TR SO2 Group 1
allowances:
    (1) Were allocated for a control period in a prior year or the
control period in the given year or in the immediately following year;
and
    (2) Are held in the assurance account, established by the
Administrator for such owners and operators of such group of TR
SO2 Group 1 sources and units in such State (and Indian
country within the borders of such State) under paragraph (b)(3) of
this section, as of the deadline established in paragraph (b)(4) of
this section.
    (b) Deductions for compliance. The Administrator will deduct TR
SO2 Group 1 allowances available under paragraph (a) of this
section for compliance with the TR SO2 Group 1 assurance
provisions for a State for a control period in a given year in
accordance with the following procedures:
    (1) By June 1, 2013 and June 1 of each year thereafter, the
Administrator will:
    (i) Calculate, for each State (and Indian country within the
borders of such State), the total SO2 emissions from all TR
SO2 Group 1 units at TR SO2 Group 1 sources in
the State (and Indian country within the borders of such State) during
the control period in the year before the year of this calculation
deadline and the amount, if any, by which such total SO2
emissions exceed the State assurance level as described in Sec.
97.606(c)(2)(iii); and
    (ii) Promulgate a notice of data availability of the results of the
calculations required in paragraph (b)(1)(i) of this section, including
separate calculations of the SO2 emissions from each TR
SO2 Group 1 source.
    (2) For each notice of data availability required in paragraph
(b)(1)(ii) of this section and for any State (and Indian country within
the borders of such State) identified in such notice as having TR
SO2 Group 1 units with total SO2 emissions
exceeding the State assurance level for a control period in a given
year, as described in Sec.  97.606(c)(2)(iii):
    (i) By July 1 immediately after the promulgation of such notice,
the designated representative of each TR SO2 Group 1 source
in each such State (and Indian country within the borders of such
State) shall submit a statement, in a format prescribed by the
Administrator, providing for each TR SO2 Group 1 unit (if
any) at the source

that operates during, but is not allocated an amount of TR
SO2 Group 1 allowances for, such control period, the unit's
allowable SO2 emission rate for such control period and, if
such rate is expressed in lb per mmBtu, the unit's heat rate.
    (ii) By August 1 immediately after the promulgation of such notice,
the Administrator will calculate, for each such State (and Indian
country within the borders of such State) and such control period and
each common designated representative for such control period for a
group of one or more TR SO2 Group 1 sources and units in the
State (and Indian country within the borders of such State), the common
designated representative's share of the total SO2 emissions
from all TR SO2 Group 1 units at TR SO2 Group 1
sources in the State (and Indian country within the borders of such
State), the common designated representative's assurance level, and the
amount (if any) of TR SO2 Group 1 allowances that the owners
and operators of such group of sources and units must hold in
accordance with the calculation formula in Sec.  97.606(c)(2)(i) and
will promulgate a notice of data availability of the results of these
calculations.
    (iii) The Administrator will provide an opportunity for submission
of objections to the calculations referenced by the notice of data
availability required in paragraph (b)(2)(ii) of this section and the
calculations referenced by the relevant notice of data availability
required in paragraph (b)(1)(i) of this section.
    (A) Objections shall be submitted by the deadline specified in such
notice and shall be limited to addressing whether the calculations
referenced in the relevant notice required under paragraph (b)(1)(ii)
of this section and referenced in the notice required under paragraph
(b)(2)(ii) of this section are in accordance with Sec.
97.606(c)(2)(iii), Sec. Sec.  97.606(b) and 97.630 through 97.635, the
definitions of ``common designated representative'', ``common
designated representative's assurance level'', and ``common designated
representative's share'' in Sec.  97.602, and the calculation formula
in Sec.  97.606(c)(2)(i).
    (B) The Administrator will adjust the calculations to the extent
necessary to ensure that they are in accordance with the provisions
referenced in paragraph (b)(2)(iii)(A) of this section. By October 1
immediately after the promulgation of such notice, the Administrator
will promulgate a notice of data availability of any adjustments that
the Administrator determines to be necessary and the reasons for
accepting or rejecting any objections submitted in accordance with
paragraph (b)(2)(iii)(A) of this section.
    (3) For any State (and Indian country within the borders of such
State) referenced in each notice of data availability required in
paragraph (b)(2)(iii)(B) of this section as having TR SO2
Group 1 units with total SO2 emissions exceeding the State
assurance level for a control period in a given year, the Administrator
will establish one assurance account for each set of owners and
operators referenced, in the notice of data availability required under
paragraph (b)(2)(iii)(B) of this section, as all of the owners and
operators of a group of TR SO2 Group 1 sources and units in
the State (and Indian country within the borders of such State) having
a common designated representative for such control period and as being
required to hold TR SO2 Group 1 allowances.
    (4)(i) As of midnight of November 1 immediately after the
promulgation of each notice of data availability required in paragraph
(b)(2)(iii)(B) of this section, the owners and operators described in
paragraph (b)(3) of this section shall hold in the assurance account
established for them and for the appropriate TR SO2 Group 1
sources, TR SO2 Group 1 units, and State (and Indian country
within the borders of such State) under paragraph (b)(3) of this
section a total amount of TR SO2 Group 1 allowances,
available for deduction under paragraph (a) of this section, equal to
the amount such owners and operators are required to hold with regard
to such sources, units and State (and Indian country within the borders
of such State) as calculated by the Administrator and referenced in
such notice.
    (ii) Notwithstanding the allowance-holding deadline specified in
paragraph (b)(4)(i) of this section, if November 1 is not a business
day, then such allowance-holding deadline shall be midnight of the
first business day thereafter.
    (5) After November 1 (or the date described in paragraph (b)(4)(ii)
of this section) immediately after the promulgation of each notice of
data availability required in paragraph (b)(2)(iii)(B) of this section
and after the recordation, in accordance with Sec.  97.623, of TR
SO2 Group 1 allowance transfers submitted by midnight of
such date, the Administrator will determine whether the owners and
operators described in paragraph (b)(3) of this section hold, in the
assurance account for the appropriate TR SO2 Group 1
sources, TR SO2 Group 1 units, and State (and Indian country
within the borders of such State) established under paragraph (b)(3) of
this section, the amount of TR SO2 Group 1 allowances
available under paragraph (a) of this section that the owners and
operators are required to hold with regard to such sources, units, and
State (and Indian country within the borders of such State) as
calculated by the Administrator and referenced in the notice required
in paragraph (b)(2)(iii)(B) of this section.
    (6) Notwithstanding any other provision of this subpart and any
revision, made by or submitted to the Administrator after the
promulgation of the notice of data availability required in paragraph
(b)(2)(iii)(B) of this section for a control period in a given year, of
any data used in making the calculations referenced in such notice, the
amounts of TR SO2 Group 1 allowances that the owners and
operators are required to hold in accordance with Sec.  97.606(c)(2)(i)
for such control period shall continue to be such amounts as calculated
by the Administrator and referenced in such notice required in
paragraph (b)(2)(iii)(B) of this section, except as follows:
    (i) If any such data are revised by the Administrator as a result
of a decision in or settlement of litigation concerning such data on
appeal under part 78 of this chapter of such notice, or on appeal under
section 307 of the Clean Air Act of a decision rendered under part 78
of this chapter on appeal of such notice, then the Administrator will
use the data as so revised to recalculate the amounts of TR
SO2 Group 1 allowances that owners and operators are
required to hold in accordance with the calculation formula in Sec.
97.606(c)(2)(i) for such control period with regard to the TR
SO2 Group 1 sources, TR SO2 Group 1 units, and
State (and Indian country within the borders of such State) involved,
provided that such litigation under part 78 of this chapter, or the
proceeding under part 78 of this chapter that resulted in the decision
appealed in such litigation under section 307 of the Clean Air Act, was
initiated no later than 30 days after promulgation of such notice
required in paragraph (b)(2)(iii)(B) of this section.
    (ii) If any such data are revised by the owners and operators of a
TR SO2 Group 1 source and TR SO2 Group 1 unit
whose designated representative submitted such data under paragraph
(b)(2)(i) of this section, as a result of a decision in or settlement
of litigation concerning such submission, then the Administrator will
use the data as so revised to recalculate the amounts of TR
SO2 Group 1 allowances that owners and operators are
required to hold in

accordance with the calculation formula in Sec.  97.606(c)(2)(i) for
such control period with regard to the TR SO2 Group 1
sources, TR SO2 Group 1 units, and State (and Indian country
within the borders of such State) involved, provided that such
litigation was initiated no later than 30 days after promulgation of
such notice required in paragraph (b)(2)(iii)(B) of this section.
    (iii) If the revised data are used to recalculate, in accordance
with paragraphs (b)(6)(i) and (ii) of this section, the amount of TR
SO2 Group 1 allowances that the owners and operators are
required to hold for such control period with regard to the TR
SO2 Group 1 sources, TR SO2 Group 1 units, and
State (and Indian country within the borders of such State) involved--
    (A) Where the amount of TR SO2 Group 1 allowances that
the owners and operators are required to hold increases as a result of
the use of all such revised data, the Administrator will establish a
new, reasonable deadline on which the owners and operators shall hold
the additional amount of TR SO2 Group 1 allowances in the
assurance account established by the Administrator for the appropriate
TR SO2 Group 1 sources, TR SO2 Group 1 units, and
State (and Indian country within the borders of such State) under
paragraph (b)(3) of this section. The owners' and operators' failure to
hold such additional amount, as required, before the new deadline shall
not be a violation of the Clean Air Act. The owners' and operators'
failure to hold such additional amount, as required, as of the new
deadline shall be a violation of the Clean Air Act. Each TR
SO2 Group 1 allowance that the owners and operators fail to
hold as required as of the new deadline, and each day in such control
period, shall be a separate violation of the Clean Air Act.
    (B) For the owners and operators for which the amount of TR
SO2 Group 1 allowances required to be held decreases as a
result of the use of all such revised data, the Administrator will
record, in all accounts from which TR SO2 Group 1 allowances
were transferred by such owners and operators for such control period
to the assurance account established by the Administrator for the
appropriate TR SO2 Group 1 sources, TR SO2 Group
1 units, and State (and Indian country within the borders of such
State) under paragraph (b)(3) of this section, a total amount of the TR
SO2 Group 1 allowances held in such assurance account equal
to the amount of the decrease. If TR SO2 Group 1 allowances
were transferred to such assurance account from more than one account,
the amount of TR SO2 Group 1 allowances recorded in each
such transferor account will be in proportion to the percentage of the
total amount of TR SO2 Group 1 allowances transferred to
such assurance account for such control period from such transferor
account.
    (C) Each TR SO2 Group 1 allowance held under paragraph
(b)(6)(iii)(A) of this section as a result of recalculation of
requirements under the TR SO2 Group 1 assurance provisions
for such control period must be a TR SO2 Group 1 allowance
allocated for a control period in a year before or the year immediately
following, or in the same year as, the year of such control period.

Sec.  97.626  Banking.

    (a) A TR SO2 Group 1 allowance may be banked for future
use or transfer in a compliance account or a general account in
accordance with paragraph (b) of this section.
    (b) Any TR SO2 Group 1 allowance that is held in a
compliance account or a general account will remain in such account
unless and until the TR SO2 Group 1 allowance is deducted or
transferred under Sec.  97.611(c), Sec.  97.623, Sec.  97.624, Sec.
97.625, Sec.  97.627, or Sec.  97.628.

Sec.  97.627  Account error.

    The Administrator may, at his or her sole discretion and on his or
her own motion, correct any error in any Allowance Management System
account. Within 10 business days of making such correction, the
Administrator will notify the authorized account representative for the
account.

Sec.  97.628  Administrator's action on submissions.

    (a) The Administrator may review and conduct independent audits
concerning any submission under the TR SO2 Group 1 Trading
Program and make appropriate adjustments of the information in the
submission.
    (b) The Administrator may deduct TR SO2 Group 1
allowances from or transfer TR SO2 Group 1 allowances to a
compliance account or an assurance account, based on the information in
a submission, as adjusted under paragraph (a)(1) of this section, and
record such deductions and transfers.

Sec.  97.629  [Reserved]

Sec.  97.630  General monitoring, recordkeeping, and reporting
requirements.

    The owners and operators, and to the extent applicable, the
designated representative, of a TR SO2 Group 1 unit, shall
comply with the monitoring, recordkeeping, and reporting requirements
as provided in this subpart and subparts F and G of part 75 of this
chapter. For purposes of applying such requirements, the definitions in
Sec.  97.602 and in Sec.  72.2 of this chapter shall apply, the terms
``affected unit,'' ``designated representative,'' and ``continuous
emission monitoring system'' (or ``CEMS'') in part 75 of this chapter
shall be deemed to refer to the terms ``TR SO2 Group 1
unit,'' ``designated representative,'' and ``continuous emission
monitoring system'' (or ``CEMS'') respectively as defined in Sec.
97.602, and the term ``newly affected unit'' shall be deemed to mean
``newly affected TR SO2 Group 1 unit''. The owner or
operator of a unit that is not a TR SO2 Group 1 unit but
that is monitored under Sec.  75.16(b)(2) of this chapter shall comply
with the same monitoring, recordkeeping, and reporting requirements as
a TR SO2 Group 1 unit.
    (a) Requirements for installation, certification, and data
accounting. The owner or operator of each TR SO2 Group 1
unit shall:
    (1) Install all monitoring systems required under this subpart for
monitoring SO2 mass emissions and individual unit heat input
(including all systems required to monitor SO2
concentration, stack gas moisture content, stack gas flow rate,
CO2 or O2 concentration, and fuel flow rate, as
applicable, in accordance with Sec. Sec.  75.11 and 75.16 of this
chapter);
    (2) Successfully complete all certification tests required under
Sec.  97.631 and meet all other requirements of this subpart and part
75 of this chapter applicable to the monitoring systems under paragraph
(a)(1) of this section; and
    (3) Record, report, and quality-assure the data from the monitoring
systems under paragraph (a)(1) of this section.
    (b) Compliance deadlines. Except as provided in paragraph (e) of
this section, the owner or operator shall meet the monitoring system
certification and other requirements of paragraphs (a)(1) and (2) of
this section on or before the following dates and shall record, report,
and quality-assure the data from the monitoring systems under paragraph
(a)(1) of this section on and after the following dates.
    (1) For the owner or operator of a TR SO2 Group 1 unit
that commences commercial operation before July 1, 2011, January 1,
2012.
    (2) For the owner or operator of a TR SO2 Group 1 unit
that commences commercial operation on or after July 1, 2011, by the
later of the following:
    (i) January 1, 2012; or
    (ii) 180 calendar days after the date on which the unit commences
commercial operation.

    (3) The owner or operator of a TR SO2 Group 1 unit for
which construction of a new stack or flue or installation of add-on
SO2 emission controls is completed after the applicable
deadline under paragraph (b)(1) or (2) of this section shall meet the
requirements of Sec. Sec.  75.4(e)(1) through (e)(4) of this chapter,
except that:
    (i) Such requirements shall apply to the monitoring systems
required under Sec.  97.630 through Sec.  97.635, rather than the
monitoring systems required under part 75 of this chapter;
    (ii) SO2 concentration, stack gas moisture content,
stack gas volumetric flow rate, and O2 or CO2
concentration data shall be determined and reported, rather than the
data listed in Sec.  75.4(e)(2) of this chapter; and
    (iii) Any petition for another procedure under Sec.  75.4(e)(2) of
this chapter shall be submitted under Sec.  97.635, rather than Sec.
75.66.
    (c) Reporting data. The owner or operator of a TR SO2
Group 1 unit that does not meet the applicable compliance date set
forth in paragraph (b) of this section for any monitoring system under
paragraph (a)(1) of this section shall, for each such monitoring
system, determine, record, and report maximum potential (or, as
appropriate, minimum potential) values for SO2
concentration, stack gas flow rate, stack gas moisture content, fuel
flow rate, and any other parameters required to determine
SO2 mass emissions and heat input in accordance with Sec.
75.31(b)(2) or (c)(3) of this chapter or section 2.4 of appendix D to
part 75 of this chapter, as applicable.
    (d) Prohibitions. (1) No owner or operator of a TR SO2
Group 1 unit shall use any alternative monitoring system, alternative
reference method, or any other alternative to any requirement of this
subpart without having obtained prior written approval in accordance
with Sec.  97.635.
    (2) No owner or operator of a TR SO2 Group 1 unit shall
operate the unit so as to discharge, or allow to be discharged,
SO2 to the atmosphere without accounting for all such
SO2 in accordance with the applicable provisions of this
subpart and part 75 of this chapter.
    (3) No owner or operator of a TR SO2 Group 1 unit shall
disrupt the continuous emission monitoring system, any portion thereof,
or any other approved emission monitoring method, and thereby avoid
monitoring and recording SO2 mass discharged into the
atmosphere or heat input, except for periods of recertification or
periods when calibration, quality assurance testing, or maintenance is
performed in accordance with the applicable provisions of this subpart
and part 75 of this chapter.
    (4) No owner or operator of a TR SO2 Group 1 unit shall
retire or permanently discontinue use of the continuous emission
monitoring system, any component thereof, or any other approved
monitoring system under this subpart, except under any one of the
following circumstances:
    (i) During the period that the unit is covered by an exemption
under Sec.  97.605 that is in effect;
    (ii) The owner or operator is monitoring emissions from the unit
with another certified monitoring system approved, in accordance with
the applicable provisions of this subpart and part 75 of this chapter,
by the Administrator for use at that unit that provides emission data
for the same pollutant or parameter as the retired or discontinued
monitoring system; or
    (iii) The designated representative submits notification of the
date of certification testing of a replacement monitoring system for
the retired or discontinued monitoring system in accordance with Sec.
97.631(d)(3)(i).
    (e) Long-term cold storage. The owner or operator of a TR
SO2 Group 1 unit is subject to the applicable provisions of
Sec.  75.4(d) of this chapter concerning units in long-term cold
storage.

Sec.  97.631  Initial monitoring system certification and
recertification procedures.

    (a) The owner or operator of a TR SO2 Group 1 unit shall
be exempt from the initial certification requirements of this section
for a monitoring system under Sec.  97.630(a)(1) if the following
conditions are met:
    (1) The monitoring system has been previously certified in
accordance with part 75 of this chapter; and
    (2) The applicable quality-assurance and quality-control
requirements of Sec.  75.21 of this chapter and appendices B and D to
part 75 of this chapter are fully met for the certified monitoring
system described in paragraph (a)(1) of this section.
    (b) The recertification provisions of this section shall apply to a
monitoring system under Sec.  97.630(a)(1) that is exempt from initial
certification requirements under paragraph (a) of this section.
    (c) [Reserved]
    (d) Except as provided in paragraph (a) of this section, the owner
or operator of a TR SO2 Group 1 unit shall comply with the
following initial certification and recertification procedures, for a
continuous monitoring system (i.e., a continuous emission monitoring
system and an excepted monitoring system under appendix D to part 75 of
this chapter) under Sec.  97.630(a)(1). The owner or operator of a unit
that qualifies to use the low mass emissions excepted monitoring
methodology under Sec.  75.19 of this chapter or that qualifies to use
an alternative monitoring system under subpart E of part 75 of this
chapter shall comply with the procedures in paragraph (e) or (f) of
this section respectively.
    (1) Requirements for initial certification. The owner or operator
shall ensure that each continuous monitoring system under Sec.
97.630(a)(1) (including the automated data acquisition and handling
system) successfully completes all of the initial certification testing
required under Sec.  75.20 of this chapter by the applicable deadline
in Sec.  97.630(b). In addition, whenever the owner or operator
installs a monitoring system to meet the requirements of this subpart
in a location where no such monitoring system was previously installed,
initial certification in accordance with Sec.  75.20 of this chapter is
required.
    (2) Requirements for recertification. Whenever the owner or
operator makes a replacement, modification, or change in any certified
continuous emission monitoring system under Sec.  97.630(a)(1) that may
significantly affect the ability of the system to accurately measure or
record SO2 mass emissions or heat input rate or to meet the
quality-assurance and quality-control requirements of Sec.  75.21 of
this chapter or appendix B to part 75 of this chapter, the owner or
operator shall recertify the monitoring system in accordance with Sec.
75.20(b) of this chapter. Furthermore, whenever the owner or operator
makes a replacement, modification, or change to the flue gas handling
system or the unit's operation that may significantly change the stack
flow or concentration profile, the owner or operator shall recertify
each continuous emission monitoring system whose accuracy is
potentially affected by the change, in accordance with Sec.  75.20(b)
of this chapter. Examples of changes to a continuous emission
monitoring system that require recertification include: Replacement of
the analyzer, complete replacement of an existing continuous emission
monitoring system, or change in location or orientation of the sampling
probe or site. Any fuel flowmeter system under Sec.  97.630(a)(1) is
subject to the recertification requirements in Sec.  75.20(g)(6) of
this chapter.
    (3) Approval process for initial certification and recertification.
For initial certification of a continuous monitoring system under Sec.
97.630(a)(1), paragraphs (d)(3)(i) through (v) of this

section apply. For recertifications of such monitoring systems,
paragraphs (d)(3)(i) through (iv) of this section and the procedures in
Sec. Sec.  75.20(b)(5) and (g)(7) of this chapter (in lieu of the
procedures in paragraph (d)(3)(v) of this section) apply, provided that
in applying paragraphs (d)(3)(i) through (iv) of this section, the
words ``certification'' and ``initial certification'' are replaced by
the word ``recertification'' and the word ``certified'' is replaced by
the word ``recertified''.
    (i) Notification of certification. The designated representative
shall submit to the appropriate EPA Regional Office and the
Administrator written notice of the dates of certification testing, in
accordance with Sec.  97.633.
    (ii) Certification application. The designated representative shall
submit to the Administrator a certification application for each
monitoring system. A complete certification application shall include
the information specified in Sec.  75.63 of this chapter.
    (iii) Provisional certification date. The provisional certification
date for a monitoring system shall be determined in accordance with
Sec.  75.20(a)(3) of this chapter. A provisionally certified monitoring
system may be used under the TR SO2 Group 1 Trading Program
for a period not to exceed 120 days after receipt by the Administrator
of the complete certification application for the monitoring system
under paragraph (d)(3)(ii) of this section. Data measured and recorded
by the provisionally certified monitoring system, in accordance with
the requirements of part 75 of this chapter, will be considered valid
quality-assured data (retroactive to the date and time of provisional
certification), provided that the Administrator does not invalidate the
provisional certification by issuing a notice of disapproval within 120
days of the date of receipt of the complete certification application
by the Administrator.
    (iv) Certification application approval process. The Administrator
will issue a written notice of approval or disapproval of the
certification application to the owner or operator within 120 days of
receipt of the complete certification application under paragraph
(d)(3)(ii) of this section. In the event the Administrator does not
issue such a notice within such 120-day period, each monitoring system
that meets the applicable performance requirements of part 75 of this
chapter and is included in the certification application will be deemed
certified for use under the TR SO2 Group 1 Trading Program.
    (A) Approval notice. If the certification application is complete
and shows that each monitoring system meets the applicable performance
requirements of part 75 of this chapter, then the Administrator will
issue a written notice of approval of the certification application
within 120 days of receipt.
    (B) Incomplete application notice. If the certification application
is not complete, then the Administrator will issue a written notice of
incompleteness that sets a reasonable date by which the designated
representative must submit the additional information required to
complete the certification application. If the designated
representative does not comply with the notice of incompleteness by the
specified date, then the Administrator may issue a notice of
disapproval under paragraph (d)(3)(iv)(C) of this section.
    (C) Disapproval notice. If the certification application shows that
any monitoring system does not meet the performance requirements of
part 75 of this chapter or if the certification application is
incomplete and the requirement for disapproval under paragraph
(d)(3)(iv)(B) of this section is met, then the Administrator will issue
a written notice of disapproval of the certification application. Upon
issuance of such notice of disapproval, the provisional certification
is invalidated by the Administrator and the data measured and recorded
by each uncertified monitoring system shall not be considered valid
quality-assured data beginning with the date and hour of provisional
certification (as defined under Sec.  75.20(a)(3) of this chapter).
    (D) Audit decertification. The Administrator may issue a notice of
disapproval of the certification status of a monitor in accordance with
Sec.  97.632(b).
    (v) Procedures for loss of certification. If the Administrator
issues a notice of disapproval of a certification application under
paragraph (d)(3)(iv)(C) of this section or a notice of disapproval of
certification status under paragraph (d)(3)(iv)(D) of this section,
then:
    (A) The owner or operator shall substitute the following values,
for each disapproved monitoring system, for each hour of unit operation
during the period of invalid data specified under Sec.
75.20(a)(4)(iii), Sec.  75.20(g)(7), or Sec.  75.21(e) of this chapter
and continuing until the applicable date and hour specified under Sec.
75.20(a)(5)(i) or (g)(7) of this chapter:
    (1) For a disapproved SO2 pollutant concentration
monitor and disapproved flow monitor, respectively, the maximum
potential concentration of SO2 and the maximum potential
flow rate, as defined in sections <IP_ADDRESS> and <IP_ADDRESS> of appendix A to
part 75 of this chapter.
    (2) For a disapproved moisture monitoring system and disapproved
diluent gas monitoring system, respectively, the minimum potential
moisture percentage and either the maximum potential CO2
concentration or the minimum potential O2 concentration (as
applicable), as defined in sections 2.1.5, <IP_ADDRESS>, and <IP_ADDRESS> of
appendix A to part 75 of this chapter.
    (3) For a disapproved fuel flowmeter system, the maximum potential
fuel flow rate, as defined in section <IP_ADDRESS> of appendix D to part 75
of this chapter.
    (B) The designated representative shall submit a notification of
certification retest dates and a new certification application in
accordance with paragraphs (d)(3)(i) and (ii) of this section.
    (C) The owner or operator shall repeat all certification tests or
other requirements that were failed by the monitoring system, as
indicated in the Administrator's notice of disapproval, no later than
30 unit operating days after the date of issuance of the notice of
disapproval.
    (e) The owner or operator of a unit qualified to use the low mass
emissions (LME) excepted methodology under Sec.  75.19 of this chapter
shall meet the applicable certification and recertification
requirements in Sec. Sec.  75.19(a)(2) and 75.20(h) of this chapter. If
the owner or operator of such a unit elects to certify a fuel flowmeter
system for heat input determination, the owner or operator shall also
meet the certification and recertification requirements in Sec.
75.20(g) of this chapter.
    (f) The designated representative of each unit for which the owner
or operator intends to use an alternative monitoring system approved by
the Administrator under subpart E of part 75 of this chapter shall
comply with the applicable notification and application procedures of
Sec.  75.20(f) of this chapter.

Sec.  97.632  Monitoring system out-of-control periods.

    (a) General provisions. Whenever any monitoring system fails to
meet the quality-assurance and quality-control requirements or data
validation requirements of part 75 of this chapter, data shall be
substituted using the applicable missing data procedures in subpart D
or appendix D to part 75 of this chapter.
    (b) Audit decertification. Whenever both an audit of a monitoring
system

and a review of the initial certification or recertification
application reveal that any monitoring system should not have been
certified or recertified because it did not meet a particular
performance specification or other requirement under Sec.  97.631 or
the applicable provisions of part 75 of this chapter, both at the time
of the initial certification or recertification application submission
and at the time of the audit, the Administrator will issue a notice of
disapproval of the certification status of such monitoring system. For
the purposes of this paragraph, an audit shall be either a field audit
or an audit of any information submitted to the Administrator or any
State or permitting authority. By issuing the notice of disapproval,
the Administrator revokes prospectively the certification status of the
monitoring system. The data measured and recorded by the monitoring
system shall not be considered valid quality-assured data from the date
of issuance of the notification of the revoked certification status
until the date and time that the owner or operator completes
subsequently approved initial certification or recertification tests
for the monitoring system. The owner or operator shall follow the
applicable initial certification or recertification procedures in Sec.
97.631 for each disapproved monitoring system.

Sec.  97.633  Notifications concerning monitoring.

    The designated representative of a TR SO2 Group 1 unit
shall submit written notice to the Administrator in accordance with
Sec.  75.61 of this chapter.

Sec.  97.634  Recordkeeping and reporting.

    (a) General provisions. The designated representative shall comply
with all recordkeeping and reporting requirements in paragraphs (b)
through (e) of this section, the applicable recordkeeping and reporting
requirements in subparts F and G of part 75 of this chapter, and the
requirements of Sec.  97.614(a).
    (b) Monitoring plans. The owner or operator of a TR SO2
Group 1 unit shall comply with requirements of Sec.  75.62 of this
chapter.
    (c) Certification applications. The designated representative shall
submit an application to the Administrator within 45 days after
completing all initial certification or recertification tests required
under Sec.  97.631, including the information required under Sec.
75.63 of this chapter.
    (d) Quarterly reports. The designated representative shall submit
quarterly reports, as follows:
    (1) The designated representative shall report the SO2
mass emissions data and heat input data for the TR SO2 Group
1 unit, in an electronic quarterly report in a format prescribed by the
Administrator, for each calendar quarter beginning with:
    (i) For a unit that commences commercial operation before July 1,
2011, the calendar quarter covering January 1, 2012 through March 31,
2012; or
    (ii) For a unit that commences commercial operation on or after
July 1, 2011, the calendar quarter corresponding to the earlier of the
date of provisional certification or the applicable deadline for
initial certification under Sec.  97.630(b), unless that quarter is the
third or fourth quarter of 2011, in which case reporting shall commence
in the quarter covering January 1, 2012 through March 31, 2012.
    (2) The designated representative shall submit each quarterly
report to the Administrator within 30 days after the end of the
calendar quarter covered by the report. Quarterly reports shall be
submitted in the manner specified in Sec.  75.64 of this chapter.
    (3) For TR SO2 Group 1 units that are also subject to
the Acid Rain Program, TR NOX Annual Trading Program, or TR
NOX Ozone Season Trading Program, quarterly reports shall
include the applicable data and information required by subparts F
through H of part 75 of this chapter as applicable, in addition to the
SO2 mass emission data, heat input data, and other
information required by this subpart.
    (4) The Administrator may review and conduct independent audits of
any quarterly report in order to determine whether the quarterly report
meets the requirements of this subpart and part 75 of this chapter,
including the requirement to use substitute data.
    (i) The Administrator will notify the designated representative of
any determination that the quarterly report fails to meet any such
requirements and specify in such notification any corrections that the
Administrator believes are necessary to make through resubmission of
the quarterly report and a reasonable time period within which the
designated representative must respond. Upon request by the designated
representative, the Administrator may specify reasonable extensions of
such time period. Within the time period (including any such
extensions) specified by the Administrator, the designated
representative shall resubmit the quarterly report with the corrections
specified by the Administrator, except to the extent the designated
representative provides information demonstrating that a specified
correction is not necessary because the quarterly report already meets
the requirements of this subpart and part 75 of this chapter that are
relevant to the specified correction.
    (ii) Any resubmission of a quarterly report shall meet the
requirements applicable to the submission of a quarterly report under
this subpart and part 75 of this chapter, except for the deadline set
forth in paragraph (d)(2) of this section.
    (e) Compliance certification. The designated representative shall
submit to the Administrator a compliance certification (in a format
prescribed by the Administrator) in support of each quarterly report
based on reasonable inquiry of those persons with primary
responsibility for ensuring that all of the unit's emissions are
correctly and fully monitored. The certification shall state that:
    (1) The monitoring data submitted were recorded in accordance with
the applicable requirements of this subpart and part 75 of this
chapter, including the quality assurance procedures and specifications;
and
    (2) For a unit with add-on SO2 emission controls and for
all hours where SO2 data are substituted in accordance with
Sec.  75.34(a)(1) of this chapter, the add-on emission controls were
operating within the range of parameters listed in the quality
assurance/quality control program under appendix B to part 75 of this
chapter and the substitute data values do not systematically
underestimate SO2 emissions.

Sec.  97.635  Petitions for alternatives to monitoring, recordkeeping,
or reporting requirements.

    (a) The designated representative of a TR SO2 Group 1
unit may submit a petition under Sec.  75.66 of this chapter to the
Administrator, requesting approval to apply an alternative to any
requirement of Sec. Sec.  97.630 through 97.634.
    (b) A petition submitted under paragraph (a) of this section shall
include sufficient information for the evaluation of the petition,
including, at a minimum, the following information:
    (i) Identification of each unit and source covered by the petition;
    (ii) A detailed explanation of why the proposed alternative is
being suggested in lieu of the requirement;
    (iii) A description and diagram of any equipment and procedures
used in the proposed alternative;
    (iv) A demonstration that the proposed alternative is consistent
with

the purposes of the requirement for which the alternative is proposed
and with the purposes of this subpart and part 75 of this chapter and
that any adverse effect of approving the alternative will be de
minimis; and
    (v) Any other relevant information that the Administrator may
require.
    (c) Use of an alternative to any requirement referenced in
paragraph (a) of this section is in accordance with this subpart only
to the extent that the petition is approved in writing by the
Administrator and that such use is in accordance with such approval.
    77. Part 97 is amended by adding subpart DDDDD to read as follows:
Subpart DDDDD--TR SO2 Group 2 Trading Program
Sec.
97.701 Purpose.
97.702 Definitions.
97.703 Measurements, abbreviations, and acronyms.
97.704 Applicability.
97.705 Retired unit exemption.
97.706 Standard requirements.
97.707 Computation of time.
97.708 Administrative appeal procedures.
97.709 [Reserved]
97.710 State SO2 Group 2 trading budgets, new unit set-
asides, Indian country new unit set-asides and variability limits.
97.711 Timing requirements for TR SO2 Group 2 allowance
allocations.
97.712 TR SO2 Group 2 allowance allocations to new units.
97.713 Authorization of designated representative and alternate
designated representative.
97.714 Responsibilities of designated representative and alternate
designated representative.
97.715 Changing designated representative and alternate designated
representative; changes in owners and operators.
97.716 Certificate of representation.
97.717 Objections concerning designated representative and alternate
designated representative.
97.718 Delegation by designated representative and alternate
designated representative.
97.719 [Reserved]
97.720 Establishment of compliance accounts and general accounts.
97.721 Recordation of TR SO2 Group 2 allowance
allocations.
97.722 Submission of TR SO2 Group 2 allowance transfers.
97.723 Recordation of TR SO2 Group 2 allowance transfers.
97.724 Compliance with TR SO2 Group 2 emissions
limitation.
97.725 Compliance with TR SO2 Group 2 assurance
provisions.
97.726 Banking.
97.727 Account error.
97.728 Administrator's action on submissions.
97.729 [Reserved]
97.730 General monitoring, recordkeeping, and reporting
requirements.
97.731 Initial monitoring system certification and recertification
procedures.
97.732 Monitoring system out-of-control periods.
97.733 Notifications concerning monitoring.
97.734 Recordkeeping and reporting.
97.735 Petitions for alternatives to monitoring, recordkeeping, or
reporting requirements.

Subpart DDDDD--TR SO2 Group 2 Trading Program

Sec.  97.701  Purpose.

    This subpart sets forth the general, designated representative,
allowance, and monitoring provisions for the Transport Rule (TR)
SO2 Group 2 Trading Program, under section 110 of the Clean
Air Act and Sec.  52.39 of this chapter, as a means of mitigating
interstate transport of fine particulates and sulfur dioxide.

Sec.  97.702  Definitions.

    The terms used in this subpart shall have the meanings set forth in
this section as follows:
    Acid Rain Program means a multi-state SO2 and
NOX air pollution control and emission reduction program
established by the Administrator under title IV of the Clean Air Act
and parts 72 through 78 of this chapter.
    Administrator means the Administrator of the United States
Environmental Protection Agency or the Director of the Clean Air
Markets Division (or its successor determined by the Administrator) of
the United States Environmental Protection Agency, the Administrator's
duly authorized representative under this subpart.
    Allocate or allocation means, with regard to TR SO2
Group 2 allowances, the determination by the Administrator, State, or
permitting authority, in accordance with this subpart and any SIP
revision submitted by the State and approved by the Administrator under
Sec.  52.39(g), (h), or (i) of this chapter, of the amount of such TR
SO2 Group 2 allowances to be initially credited, at no cost
to the recipient, to:
    (1) A TR SO2 Group 2 unit;
    (2) A new unit set-aside;
    (3) An Indian country new unit set-aside; or
    (4) An entity not listed in paragraphs (1) through (3) of this
definition;
    (5) Provided that, if the Administrator, State, or permitting
authority initially credits, to a TR SO2 Group 2 unit
qualifying for an initial credit, a credit in the amount of zero TR
SO2 Group 2 allowances, the TR SO2 Group 2 unit
will be treated as being allocated an amount (i.e., zero) of TR
SO2 Group 2 allowances.
    Allowable SO2 emission rate means, for a unit, the most stringent
State or federal SO2 emission rate limit (in lb/MWhr or, if
in lb/mmBtu, converted to lb/MWhr by multiplying it by the unit's heat
rate in mmBtu/MWhr) that is applicable to the unit and covers the
longest averaging period not exceeding one year.
    Allowance Management System means the system by which the
Administrator records allocations, deductions, and transfers of TR
SO2 Group 2 allowances under the TR SO2 Group 2
Trading Program. Such allowances are allocated, recorded, held,
deducted, or transferred only as whole allowances.
    Allowance Management System account means an account in the
Allowance Management System established by the Administrator for
purposes of recording the allocation, holding, transfer, or deduction
of TR SO2 Group 2 allowances.
    Allowance transfer deadline means, for a control period in a given
year, midnight of March 1 (if it is a business day), or midnight of the
first business day thereafter (if March 1 is not a business day),
immediately after such control period and is the deadline by which a TR
SO2 Group 2 allowance transfer must be submitted for
recordation in a TR SO2 Group 2 source's compliance account
in order to be available for use in complying with the source's TR
SO2 Group 2 emissions limitation for such control period in
accordance with Sec. Sec.  97.706 and 97.724.
    Alternate designated representative means, for a TR SO2
Group 2 source and each TR SO2 Group 2 unit at the source,
the natural person who is authorized by the owners and operators of the
source and all such units at the source, in accordance with this
subpart, to act on behalf of the designated representative in matters
pertaining to the TR SO2 Group 2 Trading Program. If the TR
SO2 Group 2 source is also subject to the Acid Rain Program,
TR NOX Annual Trading Program, or TR NOX Ozone
Season Trading Program, then this natural person shall be the same
natural person as the alternate designated representative, as defined
in the respective program.
    Assurance account means an Allowance Management System account,
established by the Administrator under Sec.  97.725(b)(3) for certain
owners and operators of a group of one or more TR SO2 Group
2 sources and units in a given State (and Indian country within the
borders of such State), in which are held TR SO2 Group 2
allowances available for use for a control period in a given year in

complying with the TR SO2 Group 2 assurance provisions in
accordance with Sec. Sec.  97.706 and 97.725.
    Authorized account representative means, for a general account, the
natural person who is authorized, in accordance with this subpart, to
transfer and otherwise dispose of TR SO2 Group 2 allowances
held in the general account and, for a TR SO2 Group 2
source's compliance account, the designated representative of the
source.
    Automated data acquisition and handling system or DAHS means the
component of the continuous emission monitoring system, or other
emissions monitoring system approved for use under this subpart,
designed to interpret and convert individual output signals from
pollutant concentration monitors, flow monitors, diluent gas monitors,
and other component parts of the monitoring system to produce a
continuous record of the measured parameters in the measurement units
required by this subpart.
    Biomass means--
    (1) Any organic material grown for the purpose of being converted
to energy;
    (2) Any organic byproduct of agriculture that can be converted into
energy; or
    (3) Any material that can be converted into energy and is
nonmerchantable for other purposes, that is segregated from other
material that is nonmerchantable for other purposes, and that is;
    (i) A forest-related organic resource, including mill residues,
precommercial thinnings, slash, brush, or byproduct from conversion of
trees to merchantable material; or
    (ii) A wood material, including pallets, crates, dunnage,
manufacturing and construction materials (other than pressure-treated,
chemically-treated, or painted wood products), and landscape or right-
of-way tree trimmings.
    Boiler means an enclosed fossil- or other-fuel-fired combustion
device used to produce heat and to transfer heat to recirculating
water, steam, or other medium.
    Bottoming-cycle unit means a unit in which the energy input to the
unit is first used to produce useful thermal energy, where at least
some of the reject heat from the useful thermal energy application or
process is then used for electricity production.
    Business day means a day that does not fall on a weekend or a
federal holiday.
    Certifying official means a natural person who is:
    (1) For a corporation, a president, secretary, treasurer, or vice-
president of the corporation in charge of a principal business function
or any other person who performs similar policy- or decision-making
functions for the corporation;
    (2) For a partnership or sole proprietorship, a general partner or
the proprietor respectively; or
    (3) For a local government entity or State, federal, or other
public agency, a principal executive officer or ranking elected
official.
    Clean Air Act means the Clean Air Act, 42 U.S.C. 7401, et seq.
    Coal means ``coal'' as defined in Sec.  72.2 of this chapter.
    Coal-derived fuel means any fuel (whether in a solid, liquid, or
gaseous state) produced by the mechanical, thermal, or chemical
processing of coal.
    Cogeneration system means an integrated group, at a source, of
equipment (including a boiler, or combustion turbine, and a steam
turbine generator) designed to produce useful thermal energy for
industrial, commercial, heating, or cooling purposes and electricity
through the sequential use of energy.
    Cogeneration unit means a stationary, fossil-fuel-fired boiler or
stationary, fossil-fuel-fired combustion turbine that is a topping-
cycle unit or a bottoming-cycle unit:
    (1) Operating as part of a cogeneration system; and
    (2) Producing on an annual average basis--
    (i) For a topping-cycle unit,
    (A) Useful thermal energy not less than 5 percent of total energy
output; and
    (B) Useful power that, when added to one-half of useful thermal
energy produced, is not less than 42.5 percent of total energy input,
if useful thermal energy produced is 15 percent or more of total energy
output, or not less than 45 percent of total energy input, if useful
thermal energy produced is less than 15 percent of total energy output.
    (ii) For a bottoming-cycle unit, useful power not less than 45
percent of total energy input;
    (3) Provided that the requirements in paragraph (2) of this
definition shall not apply to a calendar year referenced in paragraph
(2) of this definition during which the unit did not operate at all;
    (4) Provided that the total energy input under paragraphs (2)(i)(B)
and (2)(ii) of this definition shall equal the unit's total energy
input from all fuel, except biomass if the unit is a boiler; and
    (5) Provided that, if, throughout its operation during the 12-month
period or a calendar year referenced in paragraph (2) of this
definition, a unit is operated as part of a cogeneration system and the
cogeneration system meets on a system-wide basis the requirement in
paragraph (2)(i)(B) or (2)(ii) of this definition, the unit shall be
deemed to meet such requirement during that 12-month period or calendar
year.
    Combustion turbine means an enclosed device comprising:
    (1) If the device is simple cycle, a compressor, a combustor, and a
turbine and in which the flue gas resulting from the combustion of fuel
in the combustor passes through the turbine, rotating the turbine; and
    (2) If the device is combined cycle, the equipment described in
paragraph (1) of this definition and any associated duct burner, heat
recovery steam generator, and steam turbine.
    Commence commercial operation means, with regard to a unit:
    (1) To have begun to produce steam, gas, or other heated medium
used to generate electricity for sale or use, including test
generation, except as provided in Sec.  97.705.
    (i) For a unit that is a TR SO2 Group 2 unit under Sec.
97.704 on the later of January 1, 2005 or the date the unit commences
commercial operation as defined in the introductory text of paragraph
(1) of this definition and that subsequently undergoes a physical
change or is moved to a new location or source, such date shall remain
the date of commencement of commercial operation of the unit, which
shall continue to be treated as the same unit.
    (ii) For a unit that is a TR SO2 Group 2 unit under
Sec.  97.704 on the later of January 1, 2005 or the date the unit
commences commercial operation as defined in the introductory text of
paragraph (1) of this definition and that is subsequently replaced by a
unit at the same or a different source, such date shall remain the
replaced unit's date of commencement of commercial operation, and the
replacement unit shall be treated as a separate unit with a separate
date for commencement of commercial operation as defined in paragraph
(1) or (2) of this definition as appropriate.
    (2) Notwithstanding paragraph (1) of this definition and except as
provided in Sec.  97.705, for a unit that is not a TR SO2
Group 2 unit under Sec.  97.704 on the later of January 1, 2005 or the
date the unit commences commercial operation as defined in introductory
text of paragraph (1) of this definition, the unit's date for
commencement of commercial operation shall be the date on which the
unit becomes a TR SO2 Group 2 unit under Sec.  97.704.
    (i) For a unit with a date for commencement of commercial operation
as defined in the introductory text of paragraph (2) of this definition

and that subsequently undergoes a physical change or is moved to a
different location or source, such date shall remain the date of
commencement of commercial operation of the unit, which shall continue
to be treated as the same unit.
    (ii) For a unit with a date for commencement of commercial
operation as defined in the introductory text of paragraph (2) of this
definition and that is subsequently replaced by a unit at the same or a
different source, such date shall remain the replaced unit's date of
commencement of commercial operation, and the replacement unit shall be
treated as a separate unit with a separate date for commencement of
commercial operation as defined in paragraph (1) or (2) of this
definition as appropriate.
    Common designated representative means, with regard to a control
period in a given year, a designated representative where, as of April
1 immediately after the allowance transfer deadline for such control
period, the same natural person is authorized under Sec. Sec.
97.713(a) and 97.715(a) as the designated representative for a group of
one or more TR SO2 Group 2 sources and units located in a
State (and Indian country within the borders of such State).
    Common designated representative's assurance level means, with
regard to a specific common designated representative and a State (and
Indian country within the borders of such State) and control period in
a given year for which the State assurance level is exceeded as
described in Sec.  97.706(c)(2)(iii), the common designated
representative's share of the State SO2 Group 2 trading
budget with the variability limit for the State for such control
period.
    Common designated representative's share means, with regard to a
specific common designated representative for a control period in a
given year:
    (1) With regard to a total amount of SO2 emissions from
all TR SO2 Group 2 units in a State (and Indian country
within the borders of such State) during such control period, the total
tonnage of SO2 emissions during such control period from a
group of one or more TR SO2 Group 2 units located in such
State (and such Indian country) and having the common designated
representative for such control period;
    (2) With regard to a State SO2 Group 2 trading budget
with the variability limit for such control period, the amount (rounded
to the nearest allowance) equal to the sum of the total amount of TR
SO2 Group 2 allowances allocated for such control period to
a group of one or more TR SO2 Group 2 units located in the
State (and Indian country within the borders of such State) and having
the common designated representative for such control period and of the
total amount of TR SO2 Group 2 allowances purchased by an
owner or operator of such TR SO2 Group 2 units in an auction
for such control period and submitted by the State or the permitting
authority to the Administrator for recordation in the compliance
accounts for such TR SO2 Group 2 units in accordance with
the TR SO2 Group 2 allowance auction provisions in a SIP
revision approved by the Administrator under Sec.  52.39(h) or (i) of
this chapter, multiplied by the sum of the State SO2 Group 2
trading budget under Sec.  97.710(a) and the State's variability limit
under Sec.  97.710(b) for such control period and divided by such State
SO2 Group 2 trading budget;
    (3) Provided that, in the case of a unit that operates during, but
has no amount of TR SO2 Group 2 allowances allocated under
Sec. Sec.  97.711 and 97.712 for, such control period, the unit shall
be treated, solely for purposes of this definition, as being allocated
an amount (rounded to the nearest allowance) of TR SO2 Group
2 allowances for such control period equal to the unit's allowable
SO2 emission rate applicable to such control period,
multiplied by a capacity factor of 0.85 (if the unit is a boiler
combusting any amount of coal or coal-derived fuel during such control
period), 0.24 (if the unit is a simple combustion turbine during such
control period), 0.67 (if the unit is a combined cycle turbine during
such control period), 0.74 (if the unit is an integrated coal
gasification combined cycle unit during such control period), or 0.36
(for any other unit), multiplied by the unit's maximum hourly load as
reported in accordance with this subpart and by 8,760 hours/control
period, and divided by 2,000 lb/ton.
    Common stack means a single flue through which emissions from 2 or
more units are exhausted.
    Compliance account means an Allowance Management System account,
established by the Administrator for a TR SO2 Group 2 source
under this subpart, in which any TR SO2 Group 2 allowance
allocations to the TR SO2 Group 2 units at the source are
recorded and in which are held any TR SO2 Group 2 allowances
available for use for a control period in a given year in complying
with the source's TR SO2 Group 2 emissions limitation in
accordance with Sec. Sec.  97.706 and 97.724.
    Continuous emission monitoring system or CEMS means the equipment
required under this subpart to sample, analyze, measure, and provide,
by means of readings recorded at least once every 15 minutes and using
an automated data acquisition and handling system (DAHS), a permanent
record of SO2 emissions, stack gas volumetric flow rate,
stack gas moisture content, and O2 or CO2
concentration (as applicable), in a manner consistent with part 75 of
this chapter and Sec. Sec.  97.730 through 97.735. The following
systems are the principal types of continuous emission monitoring
systems:
    (1) A flow monitoring system, consisting of a stack flow rate
monitor and an automated data acquisition and handling system and
providing a permanent, continuous record of stack gas volumetric flow
rate, in standard cubic feet per hour (scfh);
    (2) A SO2 monitoring system, consisting of a
SO2 pollutant concentration monitor and an automated data
acquisition and handling system and providing a permanent, continuous
record of SO2 emissions, in parts per million (ppm);
    (3) A moisture monitoring system, as defined in Sec.  75.11(b)(2)
of this chapter and providing a permanent, continuous record of the
stack gas moisture content, in percent H2O;
    (4) A CO2 monitoring system, consisting of a
CO2 pollutant concentration monitor (or an O2
monitor plus suitable mathematical equations from which the
CO2 concentration is derived) and an automated data
acquisition and handling system and providing a permanent, continuous
record of CO2 emissions, in percent CO2; and
    (5) An O2 monitoring system, consisting of an
O2 concentration monitor and an automated data acquisition
and handling system and providing a permanent, continuous record of
O2, in percent O2.
    Control period means the period starting January 1 of a calendar
year, except as provided in Sec.  97.706(c)(3), and ending on December
31 of the same year, inclusive.
    Designated representative means, for a TR SO2 Group 2
source and each TR SO2 Group 2 unit at the source, the
natural person who is authorized by the owners and operators of the
source and all such units at the source, in accordance with this
subpart, to represent and legally bind each owner and operator in
matters pertaining to the TR SO2 Group 2 Trading Program. If
the TR SO2 Group 2 source is also subject to the Acid Rain
Program, TR NOX Annual Trading Program, or TR NOX
Ozone Season Trading Program, then this natural person shall be the
same

natural person as the designated representative, as defined in the
respective program.
    Emissions means air pollutants exhausted from a unit or source into
the atmosphere, as measured, recorded, and reported to the
Administrator by the designated representative, and as modified by the
Administrator:
    (1) In accordance with this subpart; and
    (2) With regard to a period before the unit or source is required
to measure, record, and report such air pollutants in accordance with
this subpart, in accordance with part 75 of this chapter.
    Excess emissions means any ton of emissions from the TR
SO2 Group 2 units at a TR SO2 Group 2 source
during a control period in a given year that exceeds the TR
SO2 Group 2 emissions limitation for the source for such
control period.
    Fossil fuel means--
    (1) Natural gas, petroleum, coal, or any form of solid, liquid, or
gaseous fuel derived from such material; or
    (2) For purposes of applying the limitation on ``average annual
fuel consumption of fossil fuel'' in Sec. Sec.  97.704(b)(2)(i)(B) and
(ii), natural gas, petroleum, coal, or any form of solid, liquid, or
gaseous fuel derived from such material for the purpose of creating
useful heat.
    Fossil-fuel-fired means, with regard to a unit, combusting any
amount of fossil fuel in 2005 or any calendar year thereafter.
    General account means an Allowance Management System account,
established under this subpart, that is not a compliance account or an
assurance account.
    Generator means a device that produces electricity.
    Gross electrical output means, for a unit, electricity made
available for use, including any such electricity used in the power
production process (which process includes, but is not limited to, any
on-site processing or treatment of fuel combusted at the unit and any
on-site emission controls).
    Heat input means, for a unit for a specified period of time, the
product (in mmBtu/time) of the gross calorific value of the fuel (in
mmBtu/lb) fed into the unit multiplied by the fuel feed rate (in lb of
fuel/time), as measured, recorded, and reported to the Administrator by
the designated representative and as modified by the Administrator in
accordance with this subpart and excluding the heat derived from
preheated combustion air, recirculated flue gases, or exhaust.
    Heat input rate means, for a unit, the amount of heat input (in
mmBtu) divided by unit operating time (in hr) or, for a unit and a
specific fuel, the amount of heat input attributed to the fuel (in
mmBtu) divided by the unit operating time (in hr) during which the unit
combusts the fuel.
    Heat rate means, for a unit, the unit's maximum design heat input
(in Btu/hr), divided by the product of 1,000,000 Btu/mmBtu and the
unit's maximum hourly load.
    Indian country means ``Indian country'' as defined in 18 U.S.C.
1151.
    Life-of-the-unit, firm power contractual arrangement means a unit
participation power sales agreement under which a utility or industrial
customer reserves, or is entitled to receive, a specified amount or
percentage of nameplate capacity and associated energy generated by any
specified unit and pays its proportional amount of such unit's total
costs, pursuant to a contract:
    (1) For the life of the unit;
    (2) For a cumulative term of no less than 30 years, including
contracts that permit an election for early termination; or
    (3) For a period no less than 25 years or 70 percent of the
economic useful life of the unit determined as of the time the unit is
built, with option rights to purchase or release some portion of the
nameplate capacity and associated energy generated by the unit at the
end of the period.
    Maximum design heat input means, for a unit, the maximum amount of
fuel per hour (in Btu/hr) that the unit is capable of combusting on a
steady state basis as of the initial installation of the unit as
specified by the manufacturer of the unit.
    Monitoring system means any monitoring system that meets the
requirements of this subpart, including a continuous emission
monitoring system, an alternative monitoring system, or an excepted
monitoring system under part 75 of this chapter.
    Nameplate capacity means, starting from the initial installation of
a generator, the maximum electrical generating output (in MWe, rounded
to the nearest tenth) that the generator is capable of producing on a
steady state basis and during continuous operation (when not restricted
by seasonal or other deratings) as of such installation as specified by
the manufacturer of the generator or, starting from the completion of
any subsequent physical change in the generator resulting in an
increase in the maximum electrical generating output that the generator
is capable of producing on a steady state basis and during continuous
operation (when not restricted by seasonal or other deratings), such
increased maximum amount (in MWe, rounded to the nearest tenth) as of
such completion as specified by the person conducting the physical
change.
    Natural gas means ``natural gas'' as defined in Sec.  72.2 of this
chapter.
    Newly affected TR SO2 Group 2 unit means a unit that was
not a TR SO2 Group 2 unit when it began operating but that
thereafter becomes a TR SO2 Group 2 unit.
    Operate or operation means, with regard to a unit, to combust fuel.
    Operator means, for a TR SO2 Group 2 source or a TR
SO2 Group 2 unit at a source respectively, any person who
operates, controls, or supervises a TR SO2 Group 2 unit at
the source or the TR SO2 Group 2 unit and shall include, but
not be limited to, any holding company, utility system, or plant
manager of such source or unit.
    Owner means, for a TR SO2 Group 2 source or a TR
SO2 Group 2 unit at a source respectively, any of the
following persons:
    (1) Any holder of any portion of the legal or equitable title in a
TR SO2 Group 2 unit at the source or the TR SO2
Group 2 unit;
    (2) Any holder of a leasehold interest in a TR SO2 Group
2 unit at the source or the TR SO2 Group 2 unit, provided
that, unless expressly provided for in a leasehold agreement, ``owner''
shall not include a passive lessor, or a person who has an equitable
interest through such lessor, whose rental payments are not based
(either directly or indirectly) on the revenues or income from such TR
SO2 Group 2 unit; and
    (3) Any purchaser of power from a TR SO2 Group 2 unit at
the source or the TR SO2 Group 2 unit under a life-of-the-
unit, firm power contractual arrangement.
    Permanently retired means, with regard to a unit, a unit that is
unavailable for service and that the unit's owners and operators do not
expect to return to service in the future.
    Permitting authority means ``permitting authority'' as defined in
Sec. Sec.  70.2 and 71.2 of this chapter.
    Potential electrical output capacity means, for a unit, 33 percent
of the unit's maximum design heat input, divided by 3,413 Btu/kWh,
divided by 1,000 kWh/MWh, and multiplied by 8,760 hr/yr.
    Receive or receipt of means, when referring to the Administrator,
to come into possession of a document, information, or correspondence
(whether sent in hard copy or by authorized electronic transmission),
as indicated in an official log, or by a notation made on the document,

information, or correspondence, by the Administrator in the regular
course of business.
    Recordation, record, or recorded means, with regard to TR
SO2 Group 2 allowances, the moving of TR SO2
Group 2 allowances by the Administrator into, out of, or between
Allowance Management System accounts, for purposes of allocation,
auction, transfer, or deduction.
    Reference method means any direct test method of sampling and
analyzing for an air pollutant as specified in Sec.  75.22 of this
chapter.
    Replacement, replace, or replaced means, with regard to a unit, the
demolishing of a unit, or the permanent retirement and permanent
disabling of a unit, and the construction of another unit (the
replacement unit) to be used instead of the demolished or retired unit
(the replaced unit).
    Sequential use of energy means:
    (1) The use of reject heat from electricity production in a useful
thermal energy application or process; or
    (2) The use of reject heat from useful thermal energy application
or process in electricity production.
    Serial number means, for a TR SO2 Group 2 allowance, the
unique identification number assigned to each TR SO2 Group 2
allowance by the Administrator.
    Solid waste incineration unit means a stationary, fossil-fuel-fired
boiler or stationary, fossil-fuel-fired combustion turbine that is a
``solid waste incineration unit'' as defined in section 129(g)(1) of
the Clean Air Act.
    Source means all buildings, structures, or installations located in
one or more contiguous or adjacent properties under common control of
the same person or persons. This definition does not change or
otherwise affect the definition of ``major source'', ``stationary
source'', or ``source'' as set forth and implemented in a title V
operating permit program or any other program under the Clean Air Act.
    State means one of the States that is subject to the TR
SO2 Group 2 Trading Program pursuant to Sec.  52.39(a), (c),
(g), (h), and (i) of this chapter.
    Submit or serve means to send or transmit a document, information,
or correspondence to the person specified in accordance with the
applicable regulation:
    (1) In person;
    (2) By United States Postal Service; or
    (3) By other means of dispatch or transmission and delivery;
    (4) Provided that compliance with any ``submission'' or ``service''
deadline shall be determined by the date of dispatch, transmission, or
mailing and not the date of receipt.
    Topping-cycle unit means a unit in which the energy input to the
unit is first used to produce useful power, including electricity,
where at least some of the reject heat from the electricity production
is then used to provide useful thermal energy.
    Total energy input means, for a unit, total energy of all forms
supplied to the unit, excluding energy produced by the unit. Each form
of energy supplied shall be measured by the lower heating value of that
form of energy calculated as follows:

LHV = HHV - 10.55(W + 9H)

Where:

LHV = lower heating value of the form of energy in Btu/lb,
HHV = higher heating value of the form of energy in Btu/lb,
W = weight % of moisture in the form of energy, and
H = weight % of hydrogen in the form of energy.

    Total energy output means, for a unit, the sum of useful power and
useful thermal energy produced by the unit.
    TR NOX Annual Trading Program means a multi-state NOX
air pollution control and emission reduction program established in
accordance with subpart AAAAA of this part and Sec.  52.38(a) of this
chapter (including such a program that is revised in a SIP revision
approved by the Administrator under Sec.  52.38(a)(3) or (4) of this
chapter or that is established in a SIP revision approved by the
Administrator under Sec.  52.38(a)(5) of this chapter), as a means of
mitigating interstate transport of fine particulates and
NOX.
    TR NOX Ozone Season Trading Program means a multi-state
NOX air pollution control and emission reduction program
established in accordance with subpart BBBBB of this part and Sec.
52.38(b) of this chapter (including such a program that is revised in a
SIP revision approved by the Administrator under Sec.  52.38(b)(3) or
(4) of this chapter or that is established in a SIP revision approved
by the Administrator under Sec.  52.38(b)(5) of this chapter), as a
means of mitigating interstate transport of ozone and NOX.
    TR SO2 Group 2 allowance means a limited authorization issued and
allocated or auctioned by the Administrator under this subpart, or by a
State or permitting authority under a SIP revision approved by the
Administrator under Sec.  52.39(g), (h), or (i) of this chapter, to
emit one ton of SO2 during a control period of the specified
calendar year for which the authorization is allocated or auctioned or
of any calendar year thereafter under the TR SO2 Group 2
Trading Program.
    TR SO2 Group 2 allowance deduction or deduct TR SO2 Group 2
allowances means the permanent withdrawal of TR SO2 Group 2
allowances by the Administrator from a compliance account (e.g., in
order to account for compliance with the TR SO2 Group 2
emissions limitation) or from an assurance account (e.g., in order to
account for compliance with the assurance provisions under Sec. Sec.
97.706 and 97.725).
    TR SO2 Group 2 allowances held or hold TR SO2 Group 2 allowances
means the TR SO2 Group 2 allowances treated as included in
an Allowance Management System account as of a specified point in time
because at that time they:
    (1) Have been recorded by the Administrator in the account or
transferred into the account by a correctly submitted, but not yet
recorded, TR SO2 Group 2 allowance transfer in accordance
with this subpart; and
    (2) Have not been transferred out of the account by a correctly
submitted, but not yet recorded, TR SO2 Group 2 allowance
transfer in accordance with this subpart.
    TR SO2 Group 2 emissions limitation means, for a TR SO2
Group 2 source, the tonnage of SO2 emissions authorized in a
control period by the TR SO2 Group 2 allowances available for deduction
for the source under Sec.  97.724(a) for such control period.
    TR SO2 Group 2 source means a source that includes one or more TR
SO2 Group 2 units.
    TR SO2 Group 2 Trading Program means a multi-state SO2
air pollution control and emission reduction program established in
accordance with this subpart and Sec.  52.39(a), (c), and (g) through
(k) of this chapter (including such a program that is revised in a SIP
revision approved by the Administrator under Sec.  52.39(g) or (h) of
this chapter or that is established in a SIP revision approved by the
Administrator under Sec.  52.39(i) of this chapter), as a means of
mitigating interstate transport of fine particulates and
SO2.
    TR SO2 Group 2 unit means a unit that is subject to the TR
SO2 Group 2 Trading Program under Sec.  97.704.
    Unit means a stationary, fossil-fuel-fired boiler, stationary,
fossil-fuel-fired combustion turbine, or other stationary, fossil-fuel-
fired combustion device. A unit that undergoes a physical change or is
moved to a different location or source shall continue to be treated as
the same unit. A unit (the replaced unit) that is replaced by another
unit (the

replacement unit) at the same or a different source shall continue to
be treated as the same unit, and the replacement unit shall be treated
as a separate unit.
    Unit operating day means, with regard to a unit, a calendar day in
which the unit combusts any fuel.
    Unit operating hour or hour of unit operation means, with regard to
a unit, an hour in which the unit combusts any fuel.
    Useful power means, with regard to a unit, electricity or
mechanical energy that the unit makes available for use, excluding any
such energy used in the power production process (which process
includes, but is not limited to, any on-site processing or treatment of
fuel combusted at the unit and any on-site emission controls).
    Useful thermal energy means thermal energy that is:
    (1) Made available to an industrial or commercial process (not a
power production process), excluding any heat contained in condensate
return or makeup water;
    (2) Used in a heating application (e.g., space heating or domestic
hot water heating); or
    (3) Used in a space cooling application (i.e., in an absorption
chiller).
    Utility power distribution system means the portion of an
electricity grid owned or operated by a utility and dedicated to
delivering electricity to customers.

Sec.  97.703  Measurements, abbreviations, and acronyms.

    Measurements, abbreviations, and acronyms used in this subpart are
defined as follows:

Btu--British thermal unit
CO2--carbon dioxide
H2O--water
hr--hour
kW--kilowatt electrical
kWh--kilowatt hour
lb--pound
mmBtu--million Btu
MWe--megawatt electrical
MWh--megawatt hour
NOX--nitrogen oxides
O2--oxygen
ppm--parts per million
scfh--standard cubic feet per hour
SO2--sulfur dioxide
yr--year

Sec.  97.704  Applicability.

    (a) Except as provided in paragraph (b) of this section:
    (1) The following units in a State (and Indian country within the
borders of such State) shall be TR SO2 Group 2 units, and
any source that includes one or more such units shall be a TR
SO2 Group 2 source, subject to the requirements of this
subpart: Any stationary, fossil-fuel-fired boiler or stationary,
fossil-fuel-fired combustion turbine serving at any time, on or after
January 1, 2005, a generator with nameplate capacity of more than 25
MWe producing electricity for sale.
    (2) If a stationary boiler or stationary combustion turbine that,
under paragraph (a)(1) of this section, is not a TR SO2
Group 2 unit begins to combust fossil fuel or to serve a generator with
nameplate capacity of more than 25 MWe producing electricity for sale,
the unit shall become a TR SO2 Group 2 unit as provided in
paragraph (a)(1) of this section on the first date on which it both
combusts fossil fuel and serves such generator.
    (b) Any unit in a State (and Indian country within the borders of
such State) that otherwise is a TR SO2 Group 2 unit under
paragraph (a) of this section and that meets the requirements set forth
in paragraph (b)(1)(i) or (2)(i) of this section shall not be a TR
SO2 Group 2 unit:
    (1)(i) Any unit:
    (A) Qualifying as a cogeneration unit throughout the later of 2005
or the 12-month period starting on the date the unit first produces
electricity and continuing to qualify as a cogeneration unit throughout
each calendar year ending after the later of 2005 or such 12-month
period; and
    (B) Not supplying in 2005 or any calendar year thereafter more than
one-third of the unit's potential electric output capacity or 219,000
MWh, whichever is greater, to any utility power distribution system for
sale.
    (ii) If, after qualifying under paragraph (b)(1)(i) of this section
as not being a TR SO2 Group 2 unit, a unit subsequently no
longer meets all the requirements of paragraph (b)(1)(i) of this
section, the unit shall become a TR SO2 Group 2 unit
starting on the earlier of January 1 after the first calendar year
during which the unit first no longer qualifies as a cogeneration unit
or January 1 after the first calendar year during which the unit no
longer meets the requirements of paragraph (b)(1)(i)(B) of this
section. The unit shall thereafter continue to be a TR SO2
Group 2 unit.
    (2)(i) Any unit:
    (A) Qualifying as a solid waste incineration unit throughout the
later of 2005 or the 12-month period starting on the date the unit
first produces electricity and continuing to qualify as a solid waste
incineration unit throughout each calendar year ending after the later
of 2005 or such 12-month period; and
    (B) With an average annual fuel consumption of fossil fuel for the
first 3 consecutive calendar years of operation starting no earlier
than 2005 of less than 20 percent (on a Btu basis) and an average
annual fuel consumption of fossil fuel for any 3 consecutive calendar
years thereafter of less than 20 percent (on a Btu basis).
    (ii) If, after qualifying under paragraph (b)(2)(i) of this section
as not being a TR SO2 Group 2 unit, a unit subsequently no
longer meets all the requirements of paragraph (b)(1)(i) of this
section, the unit shall become a TR SO2 Group 2 unit
starting on the earlier of January 1 after the first calendar year
during which the unit first no longer qualifies as a solid waste
incineration unit or January 1 after the first 3 consecutive calendar
years after 2005 for which the unit has an average annual fuel
consumption of fossil fuel of 20 percent or more. The unit shall
thereafter continue to be a TR SO2 Group 2 unit.
    (c) A certifying official of an owner or operator of any unit or
other equipment may submit a petition (including any supporting
documents) to the Administrator at any time for a determination
concerning the applicability, under paragraphs (a) and (b) of this
section or a SIP revision approved under Sec.  52.39(h) or (i) of this
chapter, of the TR SO2 Group 2 Trading Program to the unit
or other equipment.
    (1) Petition content. The petition shall be in writing and include
the identification of the unit or other equipment and the relevant
facts about the unit or other equipment. The petition and any other
documents provided to the Administrator in connection with the petition
shall include the following certification statement, signed by the
certifying official: ``I am authorized to make this submission on
behalf of the owners and operators of the unit or other equipment for
which the submission is made. I certify under penalty of law that I
have personally examined, and am familiar with, the statements and
information submitted in this document and all its attachments. Based
on my inquiry of those individuals with primary responsibility for
obtaining the information, I certify that the statements and
information are to the best of my knowledge and belief true, accurate,
and complete. I am aware that there are significant penalties for
submitting false statements and information or omitting required
statements and information, including the possibility of fine or
imprisonment.''
    (2) Response. The Administrator will issue a written response to
the petition

and may request supplemental information determined by the
Administrator to be relevant to such petition. The Administrator's
determination concerning the applicability, under paragraphs (a) and
(b) of this section, of the TR SO2 Group 2 Trading Program
to the unit or other equipment shall be binding on any State or
permitting authority unless the Administrator determines that the
petition or other documents or information provided in connection with
the petition contained significant, relevant errors or omissions.

Sec.  97.705  Retired unit exemption.

    (a)(1) Any TR SO2 Group 2 unit that is permanently
retired shall be exempt from Sec.  97.706(b) and (c)(1), Sec.  97.724,
and Sec. Sec.  97.730 through 97.735.
    (2) The exemption under paragraph (a)(1) of this section shall
become effective the day on which the TR SO2 Group 2 unit is
permanently retired. Within 30 days of the unit's permanent retirement,
the designated representative shall submit a statement to the
Administrator. The statement shall state, in a format prescribed by the
Administrator, that the unit was permanently retired on a specified
date and will comply with the requirements of paragraph (b) of this
section.
    (b) Special provisions. (1) A unit exempt under paragraph (a) of
this section shall not emit any SO2, starting on the date
that the exemption takes effect.
    (2) For a period of 5 years from the date the records are created,
the owners and operators of a unit exempt under paragraph (a) of this
section shall retain, at the source that includes the unit, records
demonstrating that the unit is permanently retired. The 5-year period
for keeping records may be extended for cause, at any time before the
end of the period, in writing by the Administrator. The owners and
operators bear the burden of proof that the unit is permanently
retired.
    (3) The owners and operators and, to the extent applicable, the
designated representative of a unit exempt under paragraph (a) of this
section shall comply with the requirements of the TR SO2
Group 2 Trading Program concerning all periods for which the exemption
is not in effect, even if such requirements arise, or must be complied
with, after the exemption takes effect.
    (4) A unit exempt under paragraph (a) of this section shall lose
its exemption on the first date on which the unit resumes operation.
Such unit shall be treated, for purposes of applying allocation,
monitoring, reporting, and recordkeeping requirements under this
subpart, as a unit that commences commercial operation on the first
date on which the unit resumes operation.

Sec.  97.706  Standard requirements.

    (a) Designated representative requirements. The owners and
operators shall comply with the requirement to have a designated
representative, and may have an alternate designated representative, in
accordance with Sec. Sec.  97.713 through 97.718.
    (b) Emissions monitoring, reporting, and recordkeeping
requirements. (1) The owners and operators, and the designated
representative, of each TR SO2 Group 2 source and each TR
SO2 Group 2 unit at the source shall comply with the
monitoring, reporting, and recordkeeping requirements of Sec. Sec.
97.730 through 97.735.
    (2) The emissions data determined in accordance with Sec. Sec.
97.730 through 97.735 shall be used to calculate allocations of TR
SO2 Group 2 allowances under Sec. Sec.  97.711(a)(2) and (b)
and 97.712 and to determine compliance with the TR SO2 Group
2 emissions limitation and assurance provisions under paragraph (c) of
this section, provided that, for each monitoring location from which
mass emissions are reported, the mass emissions amount used in
calculating such allocations and determining such compliance shall be
the mass emissions amount for the monitoring location determined in
accordance with Sec. Sec.  97.730 through 97.735 and rounded to the
nearest ton, with any fraction of a ton less than 0.50 being deemed to
be zero.
    (c) SO2 emissions requirements. (1) TR SO2 Group 2
emissions limitation. (i) As of the allowance transfer deadline for a
control period in a given year, the owners and operators of each TR
SO2 Group 2 source and each TR SO2 Group 2 unit
at the source shall hold, in the source's compliance account, TR
SO2 Group 2 allowances available for deduction for such
control period under Sec.  97.724(a) in an amount not less than the
tons of total SO2 emissions for such control period from all
TR SO2 Group 2 units at the source.
    (ii) If total SO2 emissions during a control period in a
given year from the TR SO2 Group 2 units at a TR
SO2 Group 2 source are in excess of the TR SO2
Group 2 emissions limitation set forth in paragraph (c)(1)(i) of this
section, then:
    (A) The owners and operators of the source and each TR
SO2 Group 2 unit at the source shall hold the TR
SO2 Group 2 allowances required for deduction under Sec.
97.724(d); and
    (B) The owners and operators of the source and each TR
SO2 Group 2 unit at the source shall pay any fine, penalty,
or assessment or comply with any other remedy imposed, for the same
violations, under the Clean Air Act, and each ton of such excess
emissions and each day of such control period shall constitute a
separate violation of this subpart and the Clean Air Act.
    (2) TR SO2 Group 2 assurance provisions. (i) If total
SO2 emissions during a control period in a given year from
all TR SO2 Group 2 units at TR SO2 Group 2
sources in a State (and Indian country within the borders of such
State) exceed the State assurance level, then the owners and operators
of such sources and units in each group of one or more sources and
units having a common designated representative for such control
period, where the common designated representative's share of such
SO2 emissions during such control period exceeds the common
designated representative's assurance level for the State and such
control period, shall hold (in the assurance account established for
the owners and operators of such group) TR SO2 Group 2
allowances available for deduction for such control period under Sec.
97.725(a) in an amount equal to two times the product (rounded to the
nearest whole number), as determined by the Administrator in accordance
with Sec.  97.725(b), of multiplying--
    (A) The quotient of the amount by which the common designated
representative's share of such SO2 emissions exceeds the
common designated representative's assurance level divided by the sum
of the amounts, determined for all common designated representatives
for such sources and units in the State (and Indian country within the
borders of such State) for such control period, by which each common
designated representative's share of such SO2 emissions
exceeds the respective common designated representative's assurance
level; and
    (B) The amount by which total SO2 emissions from all TR
SO2 Group 2 units at TR SO2 Group 2 sources in
the State (and Indian country within the borders of such State) for
such control period exceed the State assurance level.
    (ii) The owners and operators shall hold the TR SO2
Group 2 allowances required under paragraph (c)(2)(i) of this section,
as of midnight of November 1 (if it is a business day), or midnight of
the first business day thereafter (if November 1 is not a business
day), immediately after such control period.
    (iii) Total SO2 emissions from all TR SO2
Group 2 units at TR SO2 Group 2

sources in a State (and Indian country within the borders of such
State) during a control period in a given year exceed the State
assurance level if such total SO2 emissions exceed the sum,
for such control period, of the State SO2 Group 2 trading
budget under Sec.  97.710(a) and the State's variability limit under
Sec.  97.710(b).
    (iv) It shall not be a violation of this subpart or of the Clean
Air Act if total SO2 emissions from all TR SO2
Group 2 units at TR SO2 Group 2 sources in a State (and
Indian country within the borders of such State) during a control
period exceed the State assurance level or if a common designated
representative's share of total SO2 emissions from the TR
SO2 Group 2 units at TR SO2 Group 2 sources in a
State (and Indian country within the borders of such State) during a
control period exceeds the common designated representative's assurance
level.
    (v) To the extent the owners and operators fail to hold TR
SO2 Group 2 allowances for a control period in a given year
in accordance with paragraphs (c)(2)(i) through (iii) of this section,
    (A) The owners and operators shall pay any fine, penalty, or
assessment or comply with any other remedy imposed under the Clean Air
Act; and
    (B) Each TR SO2 Group 2 allowance that the owners and
operators fail to hold for such control period in accordance with
paragraphs (c)(2)(i) through (iii) of this section and each day of such
control period shall constitute a separate violation of this subpart
and the Clean Air Act.
    (3) Compliance periods. A TR SO2 Group 2 unit shall be
subject to the requirements under paragraphs (c)(1) and (c)(2) of this
section for the control period starting on the later of January 1, 2012
or the deadline for meeting the unit's monitor certification
requirements under Sec.  97.730(b) and for each control period
thereafter.
    (4) Vintage of allowances held for compliance. (i) A TR
SO2 Group 2 allowance held for compliance with the
requirements under paragraph (c)(1)(i) of this section for a control
period in a given year must be a TR SO2 Group 2 allowance
that was allocated for such control period or a control period in a
prior year.
    (ii) A TR SO2 Group 2 allowance held for compliance with
the requirements under paragraphs (c)(1)(ii)(A) and (2)(i) through
(iii) of this section for a control period in a given year must be a TR
SO2 Group 2 allowance that was allocated for a control
period in a prior year or the control period in the given year or in
the immediately following year.
    (5) Allowance Management System requirements. Each TR
SO2 Group 2 allowance shall be held in, deducted from, or
transferred into, out of, or between Allowance Management System
accounts in accordance with this subpart.
    (6) Limited authorization. A TR SO2 Group 2 allowance is
a limited authorization to emit one ton of SO2 during the
control period in one year. Such authorization is limited in its use
and duration as follows:
    (i) Such authorization shall only be used in accordance with the TR
SO2 Group 2 Trading Program; and
    (ii) Notwithstanding any other provision of this subpart, the
Administrator has the authority to terminate or limit the use and
duration of such authorization to the extent the Administrator
determines is necessary or appropriate to implement any provision of
the Clean Air Act.
    (7) Property right. A TR SO2 Group 2 allowance does not
constitute a property right.
    (d) Title V permit requirements. (1) No title V permit revision
shall be required for any allocation, holding, deduction, or transfer
of TR SO2 Group 2 allowances in accordance with this
subpart.
    (2) A description of whether a unit is required to monitor and
report SO2 emissions using a continuous emission monitoring
system (under subpart H of part 75 of this chapter), an excepted
monitoring system (under appendices D and E to part 75 of this
chapter), a low mass emissions excepted monitoring methodology (under
Sec.  75.19 of this chapter), or an alternative monitoring system
(under subpart E of part 75 of this chapter) in accordance with
Sec. Sec.  97.730 through 97.735 may be added to, or changed in, a
title V permit using minor permit modification procedures in accordance
with Sec. Sec.  70.7(e)(2) and 71.7(e)(1) of this chapter, provided
that the requirements applicable to the described monitoring and
reporting (as added or changed, respectively) are already incorporated
in such permit. This paragraph explicitly provides that the addition
of, or change to, a unit's description as described in the prior
sentence is eligible for minor permit modification procedures in
accordance with Sec. Sec.  70.7(e)(2)(i)(B) and 71.7(e)(1)(i)(B) of
this chapter.
    (e) Additional recordkeeping and reporting requirements. (1) Unless
otherwise provided, the owners and operators of each TR SO2
Group 2 source and each TR SO2 Group 2 unit at the source
shall keep on site at the source each of the following documents (in
hardcopy or electronic format) for a period of 5 years from the date
the document is created. This period may be extended for cause, at any
time before the end of 5 years, in writing by the Administrator.
    (i) The certificate of representation under Sec.  97.716 for the
designated representative for the source and each TR SO2
Group 2 unit at the source and all documents that demonstrate the truth
of the statements in the certificate of representation; provided that
the certificate and documents shall be retained on site at the source
beyond such 5-year period until such certificate of representation and
documents are superseded because of the submission of a new certificate
of representation under Sec.  97.716 changing the designated
representative.
    (ii) All emissions monitoring information, in accordance with this
subpart.
    (iii) Copies of all reports, compliance certifications, and other
submissions and all records made or required under, or to demonstrate
compliance with the requirements of, the TR SO2 Group 2
Trading Program.
    (2) The designated representative of a TR SO2 Group 2
source and each TR SO2 Group 2 unit at the source shall make
all submissions required under the TR SO2 Group 2 Trading
Program, except as provided in Sec.  97.718. This requirement does not
change, create an exemption from, or or otherwise affect the
responsible official submission requirements under a title V operating
permit program in parts 70 and 71 of this chapter.
    (f) Liability. (1) Any provision of the TR SO2 Group 2
Trading Program that applies to a TR SO2 Group 2 source or
the designated representative of a TR SO2 Group 2 source
shall also apply to the owners and operators of such source and of the
TR SO2 Group 2 units at the source.
    (2) Any provision of the TR SO2 Group 2 Trading Program
that applies to a TR SO2 Group 2 unit or the designated
representative of a TR SO2 Group 2 unit shall also apply to
the owners and operators of such unit.
    (g) Effect on other authorities. No provision of the TR
SO2 Group 2 Trading Program or exemption under Sec.  97.705
shall be construed as exempting or excluding the owners and operators,
and the designated representative, of a TR SO2 Group 2
source or TR SO2 Group 2 unit from compliance with any other
provision of the applicable, approved State implementation plan, a
federally enforceable permit, or the Clean Air Act.

Sec.  97.707  Computation of time.

    (a) Unless otherwise stated, any time period scheduled, under the
TR SO2 Group 2 Trading Program, to begin on the occurrence
of an act or event shall begin on the day the act or event occurs.
    (b) Unless otherwise stated, any time period scheduled, under the
TR SO2 Group 2 Trading Program, to begin before the
occurrence of an act or event shall be computed so that the period ends
the day before the act or event occurs.
    (c) Unless otherwise stated, if the final day of any time period,
under the TR SO2 Group 2 Trading Program, is not a business
day, the time period shall be extended to the next business day.

Sec.  97.708  Administrative appeal procedures.

    The administrative appeal procedures for decisions of the
Administrator under the TR SO2 Group 2 Trading Program are
set forth in part 78 of this chapter.

Sec.  97.709  [Reserved]

Sec.  97.710  State SO2 Group 2 trading budgets, new unit set-asides,
Indian country new unit set-aside, and variability limits.

    (a) The State SO2 Group 2 trading budgets, new unit set-
asides, and Indian country new unit set-asides for allocations of TR
SO2 Group 2 allowances for the control periods in 2012 and
thereafter are as follows:

----------------------------------------------------------------------------------------------------------------
                                                          SO2 Group 2                         Indian country new
                                                        trading budget    New unit set-aside    unit set-aside
                        State                          (tons) * for 2012    (tons) for 2012     (tons) for 2012
                                                           and 2013            and 2013            and 2013
----------------------------------------------------------------------------------------------------------------
Alabama.............................................             216,033               4,321  ..................
Georgia.............................................             158,527               3,171  ..................
Kansas..............................................              41,528                 789                  42
Minnesota...........................................              41,981                 798                  42
Nebraska............................................              65,052               2,537                  65
South Carolina......................................              88,620               1,683                  89
Texas...............................................             243,954              11,954                 244
----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
                                                          SO2 Group 2                         Indian country new
                                                        trading budget    New unit set-aside    unit set-aside
                        State                          (tons) * for 2014    (tons) for 2014     (tons) for 2014
                                                        and thereafter      and thereafter      and thereafter
----------------------------------------------------------------------------------------------------------------
Alabama.............................................             213,258               4,265  ..................
Georgia.............................................              95,231               1,905  ..................
Kansas..............................................              41,528                 789                  42
Minnesota...........................................              41,981                 798                  42
Nebraska............................................              65,052               2,537                  65
South Carolina......................................              88,620               1,683                  89
Texas...............................................             243,954              11,954                 244
----------------------------------------------------------------------------------------------------------------
* Each trading budget includes the new unit set-aside and, where applicable, the Indian country new unit set-
  aside and does not include the variability limit.

    (b) The States' variability limits for the State SO2
Group 2 trading budgets for the control periods in 2012 and thereafter
are as follows:

------------------------------------------------------------------------
                                                     Variability limits
            State              Variability limits       for 2014 and
                                for 2012 and 2013        thereafter
------------------------------------------------------------------------
Alabama.....................                38,886                38,386
Georgia.....................                28,535                17,142
Kansas......................                 7,475                 7,475
Minnesota...................                 7,557                 7,557
Nebraska....................                11,709                11,709
South Carolina..............                15,952                15,952
Texas.......................                43,912                43,912
------------------------------------------------------------------------

Sec.  97.711  Timing requirements for TR SO2 Group 2 allowance
allocations.

    (a) Existing units. (1) TR SO2 Group 2 allowances are
allocated, for the control periods in 2012 and each year thereafter, as
provided in a notice of data availability issued by the Administrator.
Providing an allocation to a unit in such notice does not constitute a
determination that the unit is a TR SO2 Group 2 unit, and
not providing an allocation to a unit in such notice does not
constitute a determination that the unit is not a TR SO2
Group 2 unit.
    (2) Notwithstanding paragraph (a)(1) of this section, if a unit
provided an allocation in the notice of data availability issued under
paragraph (a)(1) of this section does not operate, starting after 2011,
during the control period in two consecutive years, such unit will not
be allocated the TR SO2 Group 2 allowances provided in such
notice for the unit for the control periods in the fifth year after the
first such year and in each year after that fifth year. All TR
SO2 Group 2 allowances that would otherwise have been
allocated to such unit will be allocated to the new unit set-aside for
the State where such unit is located and for the respective years
involved. If such unit resumes operation, the Administrator will
allocate TR SO2 Group 2 allowances to the unit in accordance
with paragraph (b) of this section.

    (b) New units. (1) New unit set-asides. (i) By June 1, 2012 and
June 1 of each year thereafter, the Administrator will calculate the TR
SO2 Group 2 allowance allocation to each TR SO2
Group 2 unit in a State, in accordance with Sec.  97.712(a)(2) through
(7) and (12), for the control period in the year of the applicable
calculation deadline under this paragraph and will promulgate a notice
of data availability of the results of the calculations.
    (ii) For each notice of data availability required in paragraph
(b)(1)(i) of this section, the Administrator will provide an
opportunity for submission of objections to the calculations referenced
in such notice.
    (A) Objections shall be submitted by the deadline specified in each
notice of data availability required in paragraph (b)(1)(i) of this
section and shall be limited to addressing whether the calculations
(including the identification of the TR SO2 Group 2 units)
are in accordance with Sec.  97.712(a)(2) through (7) and (12) and
Sec. Sec.  97.706(b)(2) and 97.730 through 97.735.
    (B) The Administrator will adjust the calculations to the extent
necessary to ensure that they are in accordance with the provisions
referenced in paragraph (b)(1)(ii)(A) of this section. By August 1
immediately after the promulgation of each notice of data availability
required in paragraph (b)(1)(i) of this section, the Administrator will
promulgate a notice of data availability of any adjustments that the
Administrator determines to be necessary with regard to allocations
under Sec.  97.712(a)(2) through (7) and (12) and the reasons for
accepting or rejecting any objections submitted in accordance with
paragraph (b)(1)(ii)(A) of this section.
    (iii) If the new unit set-aside for such control period contains
any TR SO2 Group 2 allowances that have not been allocated
in the applicable notice of data availability required in paragraph
(b)(1)(ii) of this section, the Administrator will promulgate, by
December 15 immediately after such notice, a notice of data
availability that identifies any TR SO2 Group 2 units that
commenced commercial operation during the period starting January 1 of
the year before the year of such control period and ending November 30
of year of such control period.
    (iv) For each notice of data availability required in paragraph
(b)(1)(iii) of this section, the Administrator will provide an
opportunity for submission of objections to the identification of TR
SO2 annual units in such notice.
    (A) Objections shall be submitted by the deadline specified in each
notice of data availability required in paragraph (b)(1)(iii) of this
section and shall be limited to addressing whether the identification
of TR SO2 annual units in such notice is in accordance with
paragraph (b)(1)(iii) of this section.
    (B) The Administrator will adjust the identification of TR
SO2 Group 2 units in the each notice of data availability
required in paragraph (b)(1)(iii) of this section to the extent
necessary to ensure that it is in accordance with paragraph (b)(1)(iii)
of this section and will calculate the TR SO2 Group 2
allowance allocation to each TR SO2 Group 2 unit in
accordance with Sec.  97.712(a)(9), (10), and (12) and Sec. Sec.
97.706(b)(2) and 97.730 through 97.735. By February 15 immediately
after the promulgation of each notice of data availability required in
paragraph (b)(1)(iii) of this section, the Administrator will
promulgate a notice of data availability of any adjustments of the
identification of TR SO2 Group 2 units that the
Administrator determines to be necessary, the reasons for accepting or
rejecting any objections submitted in accordance with paragraph
(b)(1)(iv)(A) of this section, and the results of such calculations.
    (v) To the extent any TR SO2 Group 2 allowances are
added to the new unit set-aside after promulgation of each notice of
data availability required in paragraph (b)(1)(iv) of this section, the
Administrator will promulgate additional notices of data availability,
as deemed appropriate, of the allocation of such TR SO2
Group 2 allowances in accordance with Sec.  97.712(a)(10).
    (2) Indian country new unit set-asides. (i) By June 1, 2012 and
June 1 of each year thereafter, the Administrator will calculate the TR
SO2 Group 2 allowance allocation to each TR SO2
Group 2 unit in Indian country within the borders of a State, in
accordance with Sec.  97.712(b)(2) through (7) and (12), for the
control period in the year of the applicable calculation deadline under
this paragraph and will promulgate a notice of data availability of the
results of the calculations.
    (ii) For each notice of data availability required in paragraph
(b)(2)(i) of this section, the Administrator will provide an
opportunity for submission of objections to the calculations referenced
in such notice.
    (A) Objections shall be submitted by the deadline specified in each
notice of data availability required in paragraph (b)(2)(i) of this
section and shall be limited to addressing whether the calculations
(including the identification of the TR SO2 Group 2 units)
are in accordance with Sec.  97.712(b)(2) through (7) and (12) and
Sec. Sec.  97.706(b)(2) and 97.730 through 97.735.
    (B) The Administrator will adjust the calculations to the extent
necessary to ensure that they are in accordance with the provisions
referenced in paragraph (b)(2)(ii)(A) of this section. By August 1
immediately after the promulgation of each notice of data availability
required in paragraph (b)(2)(i) of this section, the Administrator will
promulgate a notice of data availability of any adjustments that the
Administrator determines to be necessary with regard to allocations
under Sec.  97.712(b)(2) through (7) and (12) and the reasons for
accepting or rejecting any objections submitted in accordance with
paragraph (b)(2)(ii)(A) of this section.
    (iii) If the Indian country new unit set-aside for such control
period contains any TR SO2 Group 2 allowances that have not
been allocated in the applicable notice of data availability required
in paragraph (b)(2)(ii) of this section, the Administrator will
promulgate, by December 15 immediately after such notice, a notice of
data availability that identifies any TR SO2 Group 2 units
that commenced commercial operation during the period starting January
1 of the year before the year of such control period and ending
November 30 of year of such control period.
    (iv) For each notice of data availability required in paragraph
(b)(2)(iii) of this section, the Administrator will provide an
opportunity for submission of objections to the identification of TR
SO2 annual units in such notice.
    (A) Objections shall be submitted by the deadline specified in each
notice of data availability required in paragraph (b)(2)(iii) of this
section and shall be limited to addressing whether the identification
of TR SO2 annual units in such notice is in accordance with
paragraph (b)(2)(iii) of this section.
    (B) The Administrator will adjust the identification of TR
SO2 Group 2 units in the each notice of data availability
required in paragraph (b)(2)(iii) of this section to the extent
necessary to ensure that it is in accordance with paragraph (b)(2)(iii)
of this section and will calculate the TR SO2 Group 2
allowance allocation to each TR SO2 Group 2 unit in
accordance with Sec.  97.712(b)(9), (10), and (12) and Sec. Sec.
97.706(b)(2) and 97.730 through 97.735. By February 15 immediately
after the promulgation of each notice of data availability required in
paragraph (b)(2)(iii) of this section, the Administrator will
promulgate a notice of data availability of any

adjustments of the identification of TR SO2 Group 2 units
that the Administrator determines to be necessary, the reasons for
accepting or rejecting any objections submitted in accordance with
paragraph (b)(2)(iv)(A) of this section, and the results of such
calculations.
    (v) To the extent any TR SO2 Group 2 allowances are
added to the Indian country new unit set-aside after promulgation of
each notice of data availability required in paragraph (b)(2)(iv) of
this section, the Administrator will promulgate additional notices of
data availability, as deemed appropriate, of the allocation of such TR
SO2 Group 2 allowances in accordance with Sec.
97.712(b)(10).
    (c) Units incorrectly allocated TR SO2 Group 2 allowances. (1) For
each control period in 2012 and thereafter, if the Administrator
determines that TR SO2 Group 2 allowances were allocated
under paragraph (a) of this section, or under a provision of a SIP
revision approved Sec.  52.39(g), (h), or (i) of this chapter, where
such control period and the recipient are covered by the provisions of
paragraph (c)(1)(i) of this section or were allocated under Sec.
97.712(a)(2) through (7), (9), and (12) and (b)(2) through (7), (9),
and (12), or under a provision of a SIP revision approved Sec.
52.39(h) or (i) of this chapter, where such control period and the
recipient are covered by the provisions of paragraph (c)(1)(ii) of this
section, then the Administrator will notify the designated
representative of the recipient and will act in accordance with the
procedures set forth in paragraphs (c)(2) through (5) of this section:
    (i)(A) The recipient is not actually a TR SO2 Group 2
unit under Sec.  97.704 as of January 1, 2012 and is allocated TR
SO2 Group 2 allowances for such control period or, in the
case of an allocation under a provision of a SIP revision approved
under Sec.  52.39(g), (h), or (i) of this chapter, the recipient is not
actually a TR SO2 Group 2 unit as of January 1, 2012 and is
allocated TR SO2 Group 2 allowances for such control period
that the SIP revision provides should be allocated only to recipients
that are TR SO2 Group 2 units as of January 1, 2012; or
    (B) The recipient is not located as of January 1 of the control
period in the State from whose SO2 Group 2 trading budget
the TR SO2 Group 2 allowances allocated under paragraph (a)
of this section, or under a provision of a SIP revision approved under
Sec.  52.39(g), (h), or (i) of this chapter, were allocated for such
control period.
    (ii) The recipient is not actually a TR SO2 Group 2 unit
under Sec.  97.704 as of January 1 of such control period and is
allocated TR SO2 Group 2 allowances for such control period
or, in the case of an allocation under a provision of a SIP revision
approved under Sec.  52.39(g), (h), or (i) of this chapter, the
recipient is not actually a TR SO2 Group 2 unit as of
January 1 of such control period and is allocated TR SO2
Group 2 allowances for such control period that the SIP revision
provides should be allocated only to recipients that are TR
SO2 Group 2 units as of January 1 of such control period.
    (2) Except as provided in paragraph (c)(3) or (4) of this section,
the Administrator will not record such TR SO2 Group 2
allowances under Sec.  97.721.
    (3) If the Administrator already recorded such TR SO2
Group 2 allowances under Sec.  97.721 and if the Administrator makes
the determination under paragraph (c)(1) of this section before making
deductions for the source that includes such recipient under Sec.
97.724(b) for such control period, then the Administrator will deduct
from the account in which such TR SO2 Group 2 allowances
were recorded an amount of TR SO2 Group 2 allowances
allocated for the same or a prior control period equal to the amount of
such already recorded TR SO2 Group 2 allowances. The
authorized account representative shall ensure that there are
sufficient TR SO2 Group 2 allowances in such account for
completion of the deduction.
    (4) If the Administrator already recorded such TR SO2
Group 2 allowances under Sec.  97.721 and if the Administrator makes
the determination under paragraph (c)(1) of this section after making
deductions for the source that includes such recipient under Sec.
97.724(b) for such control period, then the Administrator will not make
any deduction to take account of such already recorded TR
SO2 Group 2 allowances.
    (5)(i) With regard to the TR SO2 Group 2 allowances that
are not recorded, or that are deducted as an incorrect allocation, in
accordance with paragraphs (c)(2) and (3) of this section for a
recipient under paragraph (c)(1)(i) of this section, the Administrator
will:
    (A) Transfer such TR SO2 Group 2 allowances to the new
unit set-aside for such control period for the State from whose
SO2 Group 2 trading budget the TR SO2 Group 2
allowances were allocated; or
    (B) If the State has a SIP revision approved under Sec.  52.39(h)
or (i) covering such control period, include such TR SO2
Group 2 allowances in the portion of the State SO2 Group 2
trading budget that may be allocated for such control period in
accordance with such SIP revision.
    (ii) With regard to the TR SO2 Group 2 allowances that
were not allocated from the Indian country new unit set-aside for such
control period and that are not recorded, or that are deducted as an
incorrect allocation, in accordance with paragraphs (c)(2) and (3) of
this section for a recipient under paragraph (c)(1)(ii) of this
paragraph, the Administrator will:
    (A) Transfer such TR SO2 Group 2 allowances to the new
unit set-aside for such control period; or
    (B) If the State has a SIP revision approved under Sec.  52.39(h)
or (i) covering such control period, include such TR SO2
Group 2 allowances in the portion of the State SO2 Group 2
trading budget that may be allocated for such control period in
accordance with such SIP revision.
    (iii) With regard to the TR SO2 Group 2 allowances that
were allocated from the Indian country new unit set-aside for such
control period and that are not recorded, or that are deducted as an
incorrect allocation, in accordance with paragraphs (c)(2) and (3) of
this section for a recipient under paragraph (c)(1)(ii) of this
paragraph, the Administrator will transfer such TR SO2 Group
2 allowances to the Indian country new unit set-aside for such control
period.

Sec.  97.712  TR SO2 Group 2 allowance allocations to new units.

    (a) For each control period in 2012 and thereafter and for the TR
SO2 Group 2 units in each State, the Administrator will
allocate TR SO2 Group 2 allowances to the TR SO2
Group 2 units as follows:
    (1) The TR SO2 Group 2 allowances will be allocated to
the following TR SO2 Group 2 units, except as provided in
paragraph (a)(10) of this section:
    (i) TR SO2 Group 2 units that are not allocated an
amount of TR SO2 Group 2 allowances in the notice of data
availability issued under Sec.  97.711(a)(1);
    (ii) TR SO2 Group 2 units whose allocation of an amount
of TR SO2 Group 2 allowances for such control period in the
notice of data availability issued under Sec.  97.711(a)(1) is covered
by Sec.  97.711(c)(2) or (3);
    (iii) TR SO2 Group 2 units that are allocated an amount
of TR SO2 Group 2 allowances for such control period in the
notice of data availability issued under Sec.  97.711(a)(1), which
allocation is terminated for such control period pursuant to Sec.
97.711(a)(2), and that operate during the control period

immediately preceding such control period; or
    (iv) For purposes of paragraph (a)(9) of this section, TR
SO2 Group 2 units under Sec.  97.711(c)(1)(ii) whose
allocation of an amount of TR SO2 Group 2 allowances for
such control period in the notice of data availability issued under
Sec.  97.711(b)(1)(ii)(B) is covered by Sec.  97.711(c)(2) or (3).
    (2) The Administrator will establish a separate new unit set-aside
for the State for each such control period. Each such new unit set-
aside will be allocated TR SO2 Group 2 allowances in an
amount equal to the applicable amount of tons of SO2
emissions as set forth in Sec.  97.710(a) and will be allocated
additional TR SO2 Group 2 allowances (if any) in accordance
with Sec. Sec.  97.711(a)(2) and (c)(5) and paragraph (b)(10) of this
section.
    (3) The Administrator will determine, for each TR SO2
Group 2 unit described in paragraph (a)(1) of this section, an
allocation of TR SO2 Group 2 allowances for the later of the
following control periods and for each subsequent control period:
    (i) The control period in 2012;
    (ii) The first control period after the control period in which the
TR SO2 Group 2 unit commences commercial operation;
    (iii) For a unit described in paragraph (a)(1)(ii) of this section,
the first control period in which the TR SO2 Group 2 unit
operates in the State after operating in another jurisdiction and for
which the unit is not already allocated one or more TR SO2
Group 2 allowances; and
    (iv) For a unit described in paragraph (a)(1)(iii) of this section,
the first control period after the control period in which the unit
resumes operation.
    (4)(i) The allocation to each TR SO2 annual unit
described in paragraph (a)(1)(i) through (iii) of this section and for
each control period described in paragraph (a)(3) of this section will
be an amount equal to the unit's total tons of SO2 emissions
during the immediately preceding control period.
    (ii) The Administrator will adjust the allocation amount in
paragraph (a)(4)(i) in accordance with paragraphs (a)(5) through (7)
and (12) of this section.
    (5) The Administrator will calculate the sum of the TR
SO2 Group 2 allowances determined for all such TR
SO2 Group 2 units under paragraph (a)(4)(i) of this section
in the State for such control period.
    (6) If the amount of TR SO2 Group 2 allowances in the
new unit set-aside for the State for such control period is greater
than or equal to the sum under paragraph (a)(5) of this section, then
the Administrator will allocate the amount of TR SO2 Group 2
allowances determined for each such TR SO2 Group 2 unit
under paragraph (a)(4)(i) of this section.
    (7) If the amount of TR SO2 Group 2 allowances in the
new unit set-aside for the State for such control period is less than
the sum under paragraph (a)(5) of this section, then the Administrator
will allocate to each such TR SO2 Group 2 unit the amount of
the TR SO2 Group 2 allowances determined under paragraph
(a)(4)(i) of this section for the unit, multiplied by the amount of TR
SO2 Group 2 allowances in the new unit set-aside for such
control period, divided by the sum under paragraph (a)(5) of this
section, and rounded to the nearest allowance.
    (8) The Administrator will notify the public, through the
promulgation of the notices of data availability described in Sec.
97.711(b)(1)(i) and (ii), of the amount of TR SO2 Group 2
allowances allocated under paragraphs (a)(2) through (7) and (12) of
this section for such control period to each TR SO2 Group 2
unit eligible for such allocation.
    (9) If, after completion of the procedures under paragraphs (a)(5)
through (8) of this section for such control period, any unallocated TR
SO2 Group 2 allowances remain in the new unit set-aside for
the State for such control period, the Administrator will allocate such
TR SO2 Group 2 allowances as follows--