Date:
May 14, 2013
Subject:
Redline Version of the Kraft Pulp Mill NSPS Comparing the Proposed Subpart BBa to Subpart BB
EPA Contract No. EP-D-11-084; Work Assignment No. 1-08
From:
Katie Hanks

To:
Kelley Spence
U.S. Environmental Protection Agency
Research Triangle Park, NC 27711
      	The U.S. Environmental Protection Agency (EPA) is proposing changes to the New Source Performance Standards (NSPS) for Kraft Pulp Mills (40 CFR part 60, subpart BB) as part of the NSPS review required under section 111(b)(1)(B) of the Clean Air Act (CAA). Revisions to the NSPS are proposed in a new subpart BBa which would apply for new, modified, and reconstructed affected sources after the date of proposal. The attached file is a comparison of subparts BB and BBa. Text moves resulting from alphabetizing the definitions are shown in green. Red underlined text shows additions or revisions, and strikeout text shows deletions.

      No changes are proposed for subpart BB other than in §60.280(b) which specifies applicability. Section 60.280(b) is proposed to be amended with the additional wording show in red as follows:
            (b) Except as noted in §60.283(a)(1)(iv), any facility under paragraph (a) of this section that commences construction, reconstruction, or modification after September 24, 1976, and on or before [INSERT DATE OF PUBLICATION OF PROPOSED RULE] is subject to the requirements of this subpart. Any facility under paragraph (a) of this section that commences construction, reconstruction, or modification after [INSERT DATE OF PUBLICATION OF PROPOSED RULE] is subject to the requirements of subpart BBa of this part.

Subpart BBa -- Standards of Performance for Kraft Pulp Mill Affected Sources for Which Construction, Reconstruction, or Modification Commenced After [INSERT DATE OF PUBLICATION OF PROPOSED RULE]
§60.280a Applicability and designation of affected facility.
      (a) The provisions of this subpart are applicable to the following affected facilities in kraft pulp mills: Digester system, brown stock washer system, multiple-effect evaporator system, recovery furnace, smelt dissolving tank, lime kiln, and condensate stripper system. In pulp mills where kraft pulping is combined with neutral sulfite semichemical pulping, the provisions of this subpart are applicable when any portion of the material charged to an affected facility is produced by the kraft pulping operation.
      (b) Except as noted in §60.283a(a)(1)(iv), any facility under paragraph (a) of this section that commences construction, reconstruction, or modification after [INSERT DATE OF PUBLICATION OF PROPOSED RULE], is subject to the requirements of this subpart.
§60.281a Definitions.
      As used in this subpart, all terms not defined herein must have the same meaning given them in the Act and in subpart A.
      Affirmative defense means, in the context of an enforcement proceeding, a response or defense put forward by a defendant, regarding which the defendant has the burden of proof, and the merits of which are independently and objectively evaluated in a judicial or administrative proceeding.
      Black liquor oxidation system means the vessels used to oxidize, with air or oxygen, the black liquor, and associated storage tank(s).
      Black liquor solids (BLS) means the dry weight of the solids which enter the recovery furnace in the black liquor.
      Brown stock washer system means brown stock washers and associated knotters, vacuum pumps, and filtrate tanks used to wash the pulp following the digester system. Diffusion washers are excluded from this definition.
      Condensable particulate matter, for purposes of this subpart, means particulate matter measured by EPA Method 202 of Appendix M of part 51 that is vapor phase at stack conditions, but condenses and/or reacts upon cooling and dilution in the ambient air to form solid or liquid PM immediately after discharge from the stack.
      Condensate stripper system means a column, and associated condensers, used to strip, with air or steam, TRS compounds from condensate streams from various processes within a kraft pulp mill.
      Cross recovery furnace means a furnace used to recover chemicals consisting primarily of sodium and sulfur compounds by burning black liquor which on a quarterly basis contains more than 7 weight percent of the total pulp solids from the neutral sulfite semichemical process and has a green liquor sulfidity of more than 28 percent.
      Digester system means each continuous digester or each batch digester used for the cooking of wood in white liquor, and associated flash tank(s), blow tank(s), chip steamer(s), and condenser(s).
      Filterable particulate matter, for purposes of this subpart, means particulate matter measured by EPA Method 5 of Appendix A-3 of this part.
      Green liquor sulfidity means the sulfidity of the liquor which leaves the smelt dissolving tank.
      Kraft pulp mill means any stationary source which produces pulp from wood by cooking (digesting) wood chips in a water solution of sodium hydroxide and sodium sulfide (white liquor) at high temperature and pressure. Regeneration of the cooking chemicals through a recovery process is also considered part of the kraft pulp mill.
      Lime kiln means a unit used to calcine lime mud, which consists primarily of calcium carbonate, into quicklime, which is calcium oxide.
      Monitoring system malfunction means a sudden, infrequent, not reasonably preventable failure of the monitoring system to provide valid data. Monitoring system failures that are caused in part by poor maintenance or careless operation are not malfunctions. The owner or operator is required to implement monitoring system repairs in response to monitoring system malfunctions or out-of-control periods, and to return the monitoring system to operation as expeditiously as practicable.
      Multiple-effect evaporator system means the multiple-effect evaporators and associated condenser(s) and hotwell(s) used to concentrate the spent cooking liquid that is separated from the pulp (black liquor).
      Neutral sulfite semichemical pulping operation means any operation in which pulp is produced from wood by cooking (digesting) wood chips in a solution of sodium sulfite and sodium bicarbonate, followed by mechanical defibrating (grinding).

Digester system means each continuous digester or each batch digester used for the cooking of wood in white liquor, and associated flash tank(s), blow tank(s), chip steamer(s), and condenser(s).
      Brown stock washer system means brown stock washers and associated knotters, vacuum pumps, and filtrate tanks used to wash the pulp following the digester system. Diffusion washers are excluded from this definition.
      Multiple-effect evaporator system means the multiple-effect evaporators and associated condenser(s) and hotwell(s) used to concentrate the spent cooking liquid that is separated from the pulp (black liquor).
      Black liquor oxidation system means the vessels used to oxidize, with air or oxygen, the black liquor, and associated storage tank(s).
      Recovery furnace means either a straight kraft recovery furnace or a cross recovery furnace, and includes the direct-contact evaporator for a direct-contact furnace.
      Smelt dissolving tank means a vessel used for dissolving the smelt collected from the recovery furnace.
      Straight kraft recovery furnace means a furnace used to recover chemicals consisting primarily of sodium and sulfur compounds by burning black liquor which on a quarterly basis contains 7 weight percent or less of the total pulp solids from the neutral sulfite semichemical process or has green liquor sulfidity of 28 percent or less.
      Cross recovery furnace means a furnace used to recover chemicals consisting primarily of sodium and sulfur compounds by burning black liquor which on a quarterly basis contains more than 7 weight percent of the total pulp solids from the neutral sulfite semichemical process and has a green liquor sulfidity of more than 28 percent.

      Green liquor sulfidity means the sulfidity of the liquor which leaves the smelt dissolving tank.
      Smelt dissolving tank means a vessel used for dissolving the smelt collected from the recovery furnace.
      Lime kiln means a unit used to calcine lime mud, which consists primarily of calcium carbonate, into quicklime, which is calcium oxide.
      Condensate stripper system means a column, and associated condensers, used to strip, with air or steam, TRS compounds from condensate streams from various processes within a kraft pulp mill.
      Total reduced sulfur (TRS) means the sum of the sulfur compounds hydrogen sulfide, methyl mercaptan, dimethyl sulfide, and dimethyl disulfide that are released during the kraft pulping operation and measured by Method 16 of Appendix A-6 of this part.
§60.282a Standard for filterable particulate matter.
      (a) On and after the date on which the performance test required to be conducted by §60.8 is completed, no owner or operator subject to the provisions of this subpart must cause to be discharged into the atmosphere:
      (1) From any modified recovery furnace any gases which:
      (i) Contain filterable particulate matter in excess of 0.10 g/dscm (0.044 gr/dscf) corrected to 8 percent oxygen.
      (ii) Exhibit 20 percent opacity or greater, where an electrostatic precipitator (ESP) emission control device is used.
      (2) From any new or reconstructed recovery furnace any gases which:
      (i) Contain filterable particulate matter in excess of 0.034 g/dscm (0.015 gr/dscf) corrected to 8 percent oxygen.
      (ii) Exhibit 20 percent opacity or greater, where an ESP emission control device is used.
      (3) From any modified or reconstructed smelt dissolving tank, or from any new smelt dissolving tank that is not associated with a new or reconstructed recovery furnace subject to the provisions of paragraph (a)(2) of this section, any gases which contain filterable particulate matter in excess of 0.1 g/kg black liquor solids (dry weight) [0.2 lb/ton black liquor solids (dry weight)].
      (4) From any new smelt dissolving tank associated with a new or reconstructed recovery furnace subject to the provisions of paragraph (a)(2) of this section, any gases which contain filterable particulate matter in excess of 0.060 g/kg black liquor solids (dry weight) [0.12 lb/ton black liquor solids (dry weight)].
       (5) From any modified lime kiln any gases which:
      (i) Contain filterable particulate matter in excess of 0.15 g/dscm (0.064 gr/dscf) corrected to 10 percent oxygen.
      (ii) Exhibit 20 percent opacity or greater, where an ESP emission control device is used.
      (6) From any new or reconstructed lime kiln any gases which:
      (i) Contain filterable particulate matter in excess of 0.023 g/dscm (0.010 gr/dscf) corrected to 10 percent oxygen.
      (ii) Exhibit 20 percent opacity or greater, where an ESP emission control device is used.
      (b) These standards apply at all times.
      (c) The exemptions to opacity standards under 40 CFR 60.11(c) do not apply to subpart BBa.
§60.283a Standard for total reduced sulfur (TRS).
      (a) On and after the date on which the performance test required to be conducted by §60.8 is completed, no owner or operator subject to the provisions of this subpart must cause to be discharged into the atmosphere:
      (1) From any digester system, brown stock washer system, multiple-effect evaporator system, or condensate stripper system any gases which contain TRS in excess of 5 ppm by volume on a dry basis, corrected to 10 percent oxygen, unless one of the following conditions are met:
      (i) The gases are combusted in a lime kiln subject to the provisions of either paragraph (a)(5) of this section or §60.283(a)(5) of subpart BB of this part; or
      (ii) The gases are combusted in a recovery furnace subject to the provisions of either paragraphs (a)(2) or (a)(3) of this section or §60.283(a)(2) or (a)(3) of subpart BB of this part; or
      (iii) The gases are combusted with other waste gases in an incinerator or other device, or combusted in a lime kiln or recovery furnace not subject to the provisions of this subpart (or subpart BB of this part), and are subjected to a minimum temperature of 650[o]C (1200[o]F) for at least 0.5 second; or
      (iv) It has been demonstrated to the Administrator's satisfaction by the owner or operator that incinerating the exhaust gases from a new, modified, or reconstructed brown stock washer system is technologically or economically unfeasible. Any exempt system will become subject to the provisions of this subpart if the facility is changed so that the gases can be incinerated.
      (v) The gases from the digester system, brown stock washer system, or condensate stripper system are controlled by a means other than combustion. In this case, this system must not discharge any gases to the atmosphere which contain TRS in excess of 5 ppm by volume on a dry basis, uncorrected for oxygen content.
      (vi) The uncontrolled exhaust gases from a new, modified, or reconstructed digester system contain TRS less than 0.005 g/kg air dried pulp (ADP) (0.01 lb/ton ADP).
      (2) From any straight kraft recovery furnace any gases which contain TRS in excess of 5 ppm by volume on a dry basis, corrected to 8 percent oxygen.
      (3) From any cross recovery furnace any gases which contain TRS in excess of 25 ppm by volume on a dry basis, corrected to 8 percent oxygen.
      (4) From any smelt dissolving tank any gases which contain TRS in excess of 0.016 g/kg black liquor solids as H2S (0.033 lb/ton black liquor solids as H2S).
      (5) From any lime kiln any gases which contain TRS in excess of 8 ppm by volume on a dry basis, corrected to 10 percent oxygen.
      (b) These standards apply at all times.
§60.284a Monitoring of emissions and operations.
      (a) Any owner or operator subject to the provisions of this subpart must install, calibrate, maintain, and operate the continuous monitoring systems specified in paragraphs (a)(1) and (2) of this section:
      (1) A continuous monitoring system to monitor and record the opacity of the gases discharged into the atmosphere from any recovery furnace or lime kiln using an ESP emission control device, except as specified in paragraph (b)(4) of this section. The span of this system must be set at 70 percent opacity. You must install, certify, and operate the continuous opacity monitoring system in accordance with Performance Specification (PS) 1 in Appendix B to 40 CFR part 60.
      (2) Continuous monitoring systems to monitor and record the concentration of TRS emissions on a dry basis and the percent of oxygen by volume on a dry basis in the gases discharged into the atmosphere from any lime kiln, recovery furnace, digester system, brown stock washer system, multiple-effect evaporator system, or condensate stripper system, except where the provisions of §60.283a(a)(1)(iii) or (iv) apply. You must install, certify, and operate the continuous TRS monitoring system in accordance with Performance Specification (PS) 5 in Appendix B to 40 CFR part 60. These systems must be located downstream of the control device(s) and the spans of these continuous monitoring system(s) must be set:
      (i) At a TRS concentration of 30 ppm for the TRS continuous monitoring system, except that for any cross recovery furnace the span must be set at 50 ppm.
      (ii) At 21 percent oxygen for the continuous oxygen monitoring system.
      (b) Any owner or operator subject to the provisions of this subpart must install, calibrate, maintain, and operate the following continuous parameter monitoring devices specified in paragraphs (b)(1) through (4) of this section.
      (1) For any incinerator, a monitoring device for the continuous measurement of the combustion temperature at the point of incineration of effluent gases which are emitted from any digester system, brown stock washer system, multiple effect evaporator system, black liquor oxidation system, or condensate stripper system where the provisions of §60.283a(a)(1)(iii) apply. The monitoring device is to be certified by the manufacturer to be accurate within +-1 percent of the temperature being measured.
      (2) For any recovery furnace, lime kiln, or smelt dissolving tank using a wet scrubber emission control device:
      (i) A monitoring device for the continuous measurement of the pressure drop of the gas stream through the control equipment. The monitoring device is to be certified by the manufacturer to be accurate to within a gage pressure of +-500 Pascals (+-2 inches water gage pressure).
      (ii) A monitoring device for the continuous measurement of the scrubbing liquid flow rate. The monitoring device used for continuous measurement of the scrubbing liquid flow rate must be certified by the manufacturer to be accurate within +-5 percent of the design scrubbing liquid flow rate.
      (iii) As an alternative to pressure drop measurement under paragraph (b)(2)(i) of this section, a monitoring device for measurement of fan amperage may be used for smelt dissolving tank dynamic scrubbers that operate at ambient pressure or for low-energy entrainment scrubbers where the fan speed does not vary.
      (iv) As an alternative to scrubbing liquid flow rate measurement under paragraph (b)(2)(ii) of this section, a monitoring device for measurement of scrubbing liquid supply pressure may be used. The monitoring device is to be certified by the manufacturer to be accurate within +-15 percent of design scrubbing liquid supply pressure. The pressure sensor or tap is to be located close to the scrubber liquid discharge point. The Administrator may be consulted for approval of alternative locations.
      (3) For any recovery furnace or lime kiln using an ESP emission control device, the owner or operator must use the continuous parameter monitoring devices specified in paragraphs (b)(3)(i) and (ii) of this section.
      (i) A monitoring device for the continuous measurement of the secondary voltage of each ESP collection field.
      (ii) A monitoring device for the continuous measurement of the secondary current of each ESP collection field.
      (iii) Total secondary power may be calculated as the product of the secondary voltage and secondary current measurements for each ESP collection field and used to demonstrate compliance as an alternative to the secondary voltage and secondary current measurements.
      (4) For any recovery furnace or lime kiln using an ESP followed by a wet scrubber, the owner or operator must use the continuous parameter monitoring devices specified in paragraphs (b)(2) and (3) of this section. The opacity monitoring system specified in paragraph (a)(1) of this section is not required for combination ESP/wet scrubber control device systems.
       (c) Monitor operation and calculations. Any owner or operator subject to the provisions of this subpart must follow the procedures for collecting and reducing monitoring data and setting operating limits in paragraphs (c)(1) through (6) below. Subpart A of this part specifies methods for reducing continuous opacity monitoring system data.
      (1) Any owner or operator subject to the provisions of this subpart must, except where the provisions of §60.283a(a)(1)(iii) or (iv) apply, perform the following:
      (i) Calculate and record on a daily basis 12-hour average TRS concentrations for the two consecutive periods of each operating day. Each 12-hour average must be determined as the arithmetic mean of the appropriate 12 contiguous 1-hour average TRS concentrations provided by each continuous monitoring system installed under paragraph (a)(2) of this section.
      (ii) Calculate and record on a daily basis 12-hour average oxygen concentrations for the two consecutive periods of each operating day for the recovery furnace and lime kiln. These 12- hour averages must correspond to the 12-hour average TRS concentrations under paragraph (c)(1) of this section and must be determined as an arithmetic mean of the appropriate 12 contiguous 1-hour average oxygen concentrations provided by each continuous monitoring system installed under paragraph (a)(2) of this section.
      (iii) Using the following equation, correct all 12-hour average TRS concentrations to 10 volume percent oxygen, except that all 12-hour average TRS concentrations from a recovery furnace must be corrected to 8 volume percent oxygen instead of 10 percent, and all 12-hour average TRS concentrations from a facility to which the provisions of §60.283a(a)(1)(v) apply must not be corrected for oxygen content:
                          Ccorr = Cmeas(21  -  X/21  -  Y)
      where:
      Ccorr = the concentration corrected for oxygen.
      Cmeas = the concentration uncorrected for oxygen.
      X=the volumetric oxygen concentration in percentage to be corrected to (8 percent for recovery furnaces and 10 percent for lime kilns, incinerators, or other devices).
      Y=the measured 12-hour average volumetric oxygen concentration.
      (2) Record at least once each successive 5-minute period all measurements obtained from the continuous monitoring devices installed under paragraph (b)(1) of this section. Calculate 3-hour block averages from the recorded measurements of incinerator temperature. Temperature measurements recorded when no TRS emissions are fired in the incinerator (e.g., during incinerator warm-up and cool-down periods when no TRS emissions are generated or an alternative control device is used) may be omitted from the block average calculation.
      (3) Record at least once each successive 15-minute period all measurements obtained from the continuous monitoring devices installed under paragraph (b)(2) through (4) of this section and reduce the data as follows:
       (i) Calculate 12-hour block averages from the recorded measurements of wet scrubber pressure drop (or smelt dissolving tank scrubber fan amperage) and liquid flow rate (or liquid supply pressure), as applicable.
      (ii) Calculate quarterly averages from the recorded measurements of ESP parameters (secondary voltage and secondary current, or total secondary power) for ESP-controlled recovery furnaces or lime kilns that measure opacity in addition to ESP parameters.
      (iii) Calculate 12-hour block averages from the recorded measurements of ESP parameters (secondary voltage and secondary current, or total secondary power) for recovery furnaces or lime kilns with combination ESP/wet scrubber controls.
      (4) During the initial performance test required in §60.285a, the owner or operator must establish site-specific operating limits for the monitoring parameters in paragraphs (b)(2) through (4) of this section by continuously monitoring the parameters and determining the arithmetic average value of each parameter during the performance test. The arithmetic average of the measured values for the three test runs establishes your minimum site-specific operating limit for each wet scrubber or ESP parameter. Multiple performance tests may be conducted to establish a range of parameter values. The owner or operator may establish replacement operating limits for the monitoring parameters during subsequent performance tests using the test methods in §60.285a.
      (5) You must operate the continuous monitoring systems required in paragraphs (a) and (b) of this section to collect data at all required intervals at all times the affected facility is operating except for periods of monitoring system malfunctions or out-of-control periods, repairs associated with monitoring system malfunctions or out-of-control periods, and required monitoring system quality assurance or quality control activities including, as applicable, calibration checks and required zero and span adjustments.
      (6) You may not use data recorded during monitoring system malfunctions or out-of-control periods, repairs associated with monitoring system malfunctions or out-of-control periods, or required monitoring system quality assurance or control activities in calculations used to report emissions or operating limits. You must use all the data collected during all other periods in assessing the operation of the control device and associated control system.
      (7) Except for periods of monitoring system malfunctions, repairs associated with monitoring system malfunctions, and required quality monitoring system quality assurance or quality control activities (including, as applicable, system accuracy audits and required zero and span adjustments), failure to collect required data is a deviation of the monitoring requirements.
      (d) Excess emissions are defined for this subpart as follows:
      (1) For emissions from any recovery furnace, periods of excess emissions are:
      (i) All 12-hour averages of TRS concentrations above 5 ppm by volume at 8 percent oxygen for straight kraft recovery furnaces and above 25 ppm by volume at 8 percent oxygen for cross recovery furnaces during times when BLS is fired.
      (ii) All 6-minute average opacities that exceed 20 percent during times when BLS is fired.
      (2) For emissions from any lime kiln, periods of excess emissions are:
      (i) All 12-hour average TRS concentration above 8 ppm by volume at 10 percent oxygen during times when lime mud is fired.
      (ii) All 6-minute average opacities that exceed 20 percent during times when lime mud is fired.
      (3) For emissions from any digester system, brown stock washer system, multiple-effect evaporator system, or condensate stripper system, periods of excess emissions are:
      (i) All 12-hour average TRS concentrations above 5 ppm by volume at 10 percent oxygen unless the provisions of §60.283a(a)(1)(i), (ii), or (iv) apply; or
      (ii) All 3-hour block averages during which the combustion temperature at the point of incineration is less than 650°C (1200°F), where the provisions of §60.283a(a)(1)(iii) apply.
      (4) For any recovery furnace, lime kiln, or smelt dissolving tank controlled with a wet scrubber emission control device that complies with the parameter monitoring requirements specified in §60.284a(b)(2), periods of excess emissions are:
      (i) All 12-hour block average scrubbing liquid flow rate (or scrubbing liquid supply pressure) measurements below the minimum site-specific limit established during performance testing during times when BLS or lime mud is fired (as applicable), and
      (ii) All 12-hour block average scrubber pressure drop (or fan amperage, if used as an alternative under paragraph (b)(2)(iii) of this section) measurements below the minimum site-specific limit established during performance testing during times when BLS or lime mud is fired (as applicable), except during startup and shutdown.
       (5) For any recovery furnace or lime kiln controlled with an ESP followed by a wet scrubber that complies with the parameter monitoring requirements specified in §60.284a(b)(4), periods of excess emissions are:
      (i) All 12-hour block average scrubbing liquid flow rate (or scrubbing liquid supply pressure) measurements below the minimum site-specific limit established during performance testing during times when BLS or lime mud is fired (as applicable), and
      (ii) All 12-hour block average scrubber pressure drop measurements below the minimum site-specific limit established during performance testing during times when BLS or lime mud is fired (as applicable) except during startup and shutdown,
	(iii) All 12-hour block average ESP secondary voltage and secondary current measurements (or total secondary power values) below the minimum site-specific limit established during performance testing during times when BLS or lime mud is fired (as applicable).
      (e) The Administrator will not consider periods of excess emissions reported under §60.288a(a) to be indicative of a violation of the standards provided the criteria in paragraphs (e)(1) and (2) are met.
      (1) The percent of the total number of possible contiguous periods of excess emissions in a quarter does not exceed:
      (i) One percent for TRS emissions from recovery furnaces, provided that the TRS concentration does not exceed 30 ppm corrected to 8 percent oxygen.
      (ii) Two percent for average opacities from recovery furnaces, provided that the ESP secondary voltage and secondary current averaged over the quarter remained above the minimum operating limits established during the performance test.
      (iii) One percent for TRS emissions from lime kilns, provided that the TRS concentration does not exceed 22 ppm corrected to 10 percent oxygen.
      (iv) One percent for average opacities from lime kilns, provided that the ESP secondary voltage and secondary current (or total secondary power) averaged over the quarter remained above the minimum operating limits established during the performance test.
      (2) The Administrator determines that the affected facility, including air pollution control equipment, is maintained and operated in a manner which is consistent with good air pollution control practice for minimizing emissions during periods of excess emissions.
      (3) The TRS concentration uncorrected for oxygen may be considered when determining compliance with the excess emissions provisions in paragraphs (e)(1)(i) and (iii) of this section during periods of startup or shutdown when stack oxygen percentage approaches ambient conditions. If the measured TRS concentration uncorrected for oxygen is less than the applicable limit (5 ppm for recovery furnaces or 8 ppm for lime kilns) during periods of startup or shutdown when the stack oxygen concentration is 15 percent or greater, then the Administrator will consider the TRS average to be in compliance. This provision only applies during periods of affected facility startup and shutdown.
      (f) The procedures under §60.13 must be followed for installation, evaluation, and operation of the continuous monitoring systems required under this section. All continuous monitoring systems must be operated in accordance with the applicable procedures under Performance Specifications 1, 3, and 5 of appendix B of this part.
§60.285a Test methods and procedures.
      (a) In conducting the performance tests required by this subpart and §60.8, the owner or operator must use as reference methods and procedures the test methods in appendix A of this part or other methods and procedures in this section, except as provided in §60.8(b). Acceptable alternative methods and procedures are given in paragraph (f) of this section.
      (b) The owner or operator must determine compliance with the filterable particulate matter standards in §60.282a(a)(1), (2), (5) and (6) as follows:
      (1) Method 5 of Appendix A-3 of this part must be used to determine the filterable particulate matter concentration. The sampling time and sample volume for each run must be at least 60 minutes and 0.90 dscm (31.8 dscf). Water must be used as the cleanup solvent instead of acetone in the sample recovery procedure. The particulate concentration must be corrected to the appropriate oxygen concentration according to §60.284a(c)(3).
      (2) The emission rate correction factor, integrated sampling and analysis procedure of Method 3B of Appendix A-2 of this part must be used to determine the oxygen concentration. The gas sample must be taken at the same time and at the same traverse points as the particulate sample.
      (3) Method 9 of Appendix A-4 of this part and the procedures in §60.11 must be used to determine opacity.  Opacity measurement is not required for recovery furnaces or lime kilns operating with a wet scrubber alone or a wet scrubber in combination with an ESP.
      (4) In addition to the initial performance test required by this subpart and §60.8(a), you must conduct repeat performance tests for filterable particulate matter at intervals no longer than 60 months following the previous performance test using the procedures in paragraphs (b)(1) and (2) of this section.
      (5) When the initial and repeat performance tests are conducted for filterable particulate matter, the owner or operator must also measure condensable particulate matter using Method 202 of Appendix M of part 51.
      (c) The owner or operator must determine compliance with the filterable particular matter standards in §60.282a(a)(3) and (4) as follows:
      (1) The emission rate (E) of filterable particulate matter must be computed for each run using the following equation:
                                    E = csQsd/BLS
      where:
      E = emission rate of filterable particulate matter, g/kg (lb/ton) of BLS.
      cs = Concentration of filterable particulate matter, g/dscm (lb/dscf).
      Qsd = volumetric flow rate of effluent gas, dscm/hr (dscf/hr).
      BLS = black liquor solids (dry weight) feed rate, kg/hr (ton/hr).
      (2) Method 5 of Appendix A-3 of this part must be used to determine the filterable particulate matter concentration (cs) and the volumetric flow rate (Qsd) of the effluent gas. The sampling time and sample volume must be at least 60 minutes and 0.90 dscm (31.8 dscf). Water must be used instead of acetone in the sample recovery.
      (3) Process data must be used to determine the black liquor solids (BLS) feed rate on a dry weight basis.
      (4) In addition to the initial performance test required by this subpart and §60.8(a), you must conduct repeat performance tests for filterable particulate matter at intervals no longer than 60 months following the previous performance test using the procedures in paragraphs (c)(1) through (3) of this section must be conducted within 60 months following the previous filterable particulate matter performance test.
      (5) When the initial and repeat performance tests are conducted for filterable particulate matter, the owner or operator must also measure condensable particulate matter using Method 202 of Appendix M of part 51.
      (d) The owner or operator must determine compliance with the TRS standards in §60.283a, except §60.283a(a)(1)(vi) and (4), as follows:
      (1) Method 16 of Appendix A-6 of this part must be used to determine the TRS concentration. The TRS concentration must be corrected to the appropriate oxygen concentration using the procedure in §60.284a(c)(3). The sampling time must be at least 3 hours, but no longer than 6 hours.
      (2) The emission rate correction factor, integrated sampling and analysis procedure of Method 3B of Appendix A-2 of this part must be used to determine the oxygen concentration. The sample must be taken over the same time period as the TRS samples.
      (3) When determining whether a furnace is a straight kraft recovery furnace or a cross recovery furnace, TAPPI Method T.624 (incorporated by reference -- see §60.17(d)(1)) must be used to determine sodium sulfide, sodium hydroxide, and sodium carbonate. These determinations must be made 3 times daily from the green liquor, and the daily average values must be converted to sodium oxide (Na20) and substituted into the following equation to determine the green liquor sulfidity:

      Where:
      GLS = green liquor sulfidity, percent.
      CNa2S = concentration of Na2S as Na2O, mg/ liter (gr/gal).
      CNaOH = concentration of NaOH as Na2O, mg/ liter (gr/gal).
      CNa2CO3 = concentration of Na2CO3 as Na2O, mg/ liter (gr/gal).
      (4) For recovery furnaces and lime kilns, in addition to the initial performance test required in this subpart and §60.8(a), you must conduct repeat TRS performance tests at intervals no longer than 60 months following the previous performance test using the procedures in paragraphs (d)(1) and (2) of this section.
      (e) The owner or operator must determine compliance with the TRS standards in §60.283a(a)(1)(vi) and (4) as follows:
      (1) The emission rate (E) of TRS must be computed for each run using the following equation:
                                   E=CTRS F Qsd/P
      where:
      E=emission rate of TRS, g/kg (lb/ton) of BLS or ADP.
      CTRS=average combined concentration of TRS, ppm.
      F = conversion factor, 0.001417 g H2S/m[3]-ppm (8.846 x 10[-8] lb H2S/ft[3]-ppm).
      Qsd=volumetric flow rate of stack gas, dscm/ hr (dscf/hr).
      P=black liquor solids feed or pulp production rate, kg/hr (ton/hr).
      (2) Method 16 of Appendix A-6 of this part must be used to determine the TRS concentration (CTRS).
      (3) Method 2 of Appendix A-1 of this part must be used to determine the volumetric flow rate (Qsd) of the effluent gas.
      (4) Process data must be used to determine the black liquor feed rate or the pulp production rate (P).
      (5) For smelt dissolving tanks, in addition to the initial performance test required in this subpart and §60.8(a), you must conduct repeat TRS performance tests at intervals no longer than 60 months following the previous performance test using the procedures in paragraphs (e)(1) through (4) of this section.
      (f) The owner or operator may use the following as alternatives to the reference methods and procedures specified in this section:
      (1) In place of Method 5 of Appendix A-3 of this part, Method 17 of Appendix A-6 of this part may be used if a constant value of 0.009 g/dscm (0.004 gr/dscf) is added to the results of Method 17 and the stack temperature is no greater than 204°C (400°F).
      (2) In place of Method 16 of Appendix A-6 of this part, Method 16A, 16B, or 16C of Appendix A-6 of this part may be used.
      (3) In place of Method 3B of Appendix A-2 of this part, ASME PTC 19.10 - 1981 [Part 10] (incorporated by reference -- see §60.17(h)(4)) may be used.

§60.286a Affirmative Defense for Violations of Emission Standards During Malfunction.
      In response to an action to enforce the standards set forth in §§60.282a and 60.283a, you may assert an affirmative defense to a claim for civil penalties for violations of such standards that are caused by malfunction, as defined at §60.2. Appropriate penalties may be assessed if you fail to meet your burden of proving all of the requirements in the affirmative defense. The affirmative defense must not be available for claims for injunctive relief.
      (a) Assertion of affirmative defense. To establish the affirmative defense in any action to enforce such a standard, you must timely meet the reporting requirements in paragraph (b) of this section, and must prove by a preponderance of evidence that:
	(1) The violation:
      (i) Was caused by a sudden, infrequent, and unavoidable failure of air pollution control equipment, process equipment, or a process to operate in a normal or usual manner; and
      (ii) Could not have been prevented through careful planning, proper design or better operation and maintenance practices; and
	(iii) Did not stem from any activity or event that could have been foreseen and avoided, or planned for; and
      (iv) Was not part of a recurring pattern indicative of inadequate design, operation, or maintenance; and
      (2) Repairs were made as expeditiously as possible when a violation occurred; and
      (3) The frequency, amount, and duration of the violation (including any bypass) were minimized to the maximum extent practicable; and
      (4) If the violation resulted from a bypass of control equipment or a process, then the bypass was unavoidable to prevent loss of life, personal injury, or severe property damage; and
      (5) All possible steps were taken to minimize the impact of the violation on ambient air quality, the environment, and human health; and
      (6) All emissions monitoring and control systems were kept in operation if at all possible, consistent with safety and good air pollution control practices; and
      (7) All of the actions in response to the violation were documented by properly signed, contemporaneous operating logs; and
      (8) At all times, the affected source was operated in a manner consistent with good practices for minimizing emissions; and
      (9) A written root cause analysis has been prepared, the purpose of which is to determine, correct, and eliminate the primary causes of the malfunction and the violation resulting from the malfunction event at issue. The analysis must also specify, using best monitoring methods and engineering judgment, the amount of any emissions that were the result of the malfunction.
      (b) Report. The owner or operator seeking to assert an affirmative defense must submit a written report to the Administrator with all necessary supporting documentation that explains how it has met the requirements set forth in paragraph (a) of this section. This affirmative defense report must be included in the first periodic compliance, deviation report or excess emission report otherwise required after the initial occurrence of the violation of the relevant standard (which may be the end of any applicable averaging period). If such compliance, deviation report or excess emission report is due less than 45 days after the initial occurrence of the violation, the affirmative defense report may be included in the second compliance, deviation report or excess emission report due after the initial occurrence of the violation of the relevant standard.
§60.287a Recordkeeping
	(a) The owner or operator must maintain records of the performance evaluations of the continuous monitoring systems.
      (b) For each continuous monitoring system, the owner or operator must maintain records of the following information, as applicable:
      (1) Records of the opacity of the gases discharged into the atmosphere from any recovery furnace or lime kiln using an ESP emission control device, except as specified in paragraph (b)(6) of this section, and records of the ESP secondary voltage and secondary current (or total secondary power) averaged over the reporting period for the opacity allowances specified in §60.284a(e)(1)(ii) and (iv).
      (2) Records of the concentration of TRS emissions on a dry basis and the percent of oxygen by volume on a dry basis in the gases discharged into the atmosphere from any lime kiln, recovery furnace, digester system, brown stock washer system, multiple-effect evaporator system, or condensate stripper system, except where the provisions of §60.283a(a)(1)(iii) or (iv) apply.
      (3) Records of the combustion temperature at the point of incineration of effluent gases which are emitted from any digester system, brown stock washer system, multiple effect evaporator system, black liquor oxidation system, or condensate stripper system where the provisions of §60.283a(a)(1)(iii) apply.
      (4) For any recovery furnace, lime kiln, or smelt dissolving tank using a wet scrubber emission control device:
      (i) Records of the pressure drop of the gas stream through the control equipment (or smelt dissolving tank scrubber fan amperage), and
      (ii) Records of the scrubbing liquid flow rate (or scrubbing liquid supply pressure).
      (5) For any recovery furnace or lime kiln using an ESP control device:
      (i) Records of the secondary voltage of each ESP collection field, and
      (ii) Records of the secondary current of each ESP collection field, and
      (iii) If used as an alternative to secondary voltage and current, records of the total secondary power of each ESP collection field.
      (6) For any recovery furnace or lime kiln using an ESP followed by a wet scrubber, the records specified under paragraphs (b)(4) and (5) of this section.
      (7) Records of excess emissions as defined in §60.284a(d).
	(c) For each malfunction, the owner or operator must maintain records of the following information:
	(1) Records of the occurrence and duration of each malfunction of operation (i.e., process equipment) or the air pollution control and monitoring equipment.
	(2) Records of actions taken during periods of malfunction to minimize emissions in accordance with §60.11(d), including corrective actions to restore malfunctioning process and air pollution control and monitoring equipment to its normal or usual manner of operation.
§60.288a Reporting
	(a) For the purpose of reports required under §60.7(c), any owner or operator subject to the provisions of this subpart must report semiannually periods of excess emissions defined in 60.284a(d).
	(b) Within 60 days after the date of completing each performance test (defined in §60.8) as required by this subpart you must submit the results of the performance tests, including any associated fuel analyses, required by this subpart to the EPA as follows. You must use the latest version of the EPA's Electronic Reporting Tool (ERT) (see http://www.epa.gov/ttn/chief/ert/index.html) existing at the time of the performance test to generate a submission package file, which documents performance test data. You must then submit the file generated by the ERT through the EPA's Compliance and Emissions Data Reporting Interface (CEDRI), which can be accessed by logging in to the EPA's Central Data Exchange (CDX) (https://cdx.epa.gov/). Only data collected using test methods supported by the ERT as listed on the ERT website are subject to the requirement to submit the performance test data electronically. Owners or operators who claim that some of the information being submitted for performance tests is confidential business information (CBI) must submit a complete ERT file including information claimed to be CBI on a compact disk, flash drive, or other commonly used electronic storage media to the EPA. The electronic media must be clearly marked as CBI and mailed to U.S. EPA/OAPQS/CORE CBI Office, Attention: WebFIRE Administrator, MD C404-02, 4930 Old Page Rd., Durham, NC 27703. The same ERT file with the CBI omitted must be submitted to the EPA via CDX as described earlier in this paragraph. At the discretion of the delegated authority, you must also submit these reports, including the confidential business information, to the delegated authority in the format specified by the delegated authority. For any performance test conducted using test methods that are not listed on the ERT website, the owner or operator must submit the results of the performance test to the Administrator at the appropriate address listed in §60.4.
	(c) Within 60 days after the date of completing each CEMS performance evaluation test as defined in §60.13, you must submit relative accuracy test audit (RATA) data to the EPA's Central Data Exchange (CDX) by using CEDRI in accordance with paragraph (b) of this section. Only RATA pollutants that can be documented with the ERT (as listed on the ERT website) are subject to this requirement. For any performance evaluations with no corresponding RATA pollutants listed on the ERT website, the owner or operator must submit the results of the performance evaluation to the Administrator at the appropriate address listed in §60.4.
	(d) If a malfunction occurred during the reporting period, you must submit a report that contains the following:
	(1) The number, duration, and a brief description for each type of malfunction which occurred during the reporting period and which caused or may have caused any applicable emission limitation to be exceeded.
	(2) A description of actions taken by an owner or operator during a malfunction of an affected facility to minimize emissions in accordance with §60.11(d), including actions taken to correct a malfunction.


[Federal Register Volume 77, Number 219 (Tuesday, November 13, 2012)]
[Notices]
[Pages 67723-67724]
[FR Doc No: 2012-27510]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68164; File No. SR-CBOE-2012-071]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Order Granting Approval of Proposed Rule Change To
Increase the Maximum Term for LEAPS to Fifteen Years

November 6, 2012.

I. Introduction

    On July 24, 2012, the Chicago Board Options Exchange, Incorporated
(``Exchange'' or ``CBOE'') filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4

thereunder,\2\ a proposed rule change to increase the maximum term for
Long-Term Equity Options Series (``LEAPS'') to fifteen years. The
proposed rule change was published for comment in the Federal Register
on August 10, 2012.\3\ A designation of a longer period for Commission
action was published in the Federal Register on September 25, 2012.\4\
The Commission received one comment on the proposed rule change.\5\ On
September 6, 2012, CBOE responded to the comment letter.\6\ This order
approves the proposed rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 67600 (August 6,
2012), 77 FR 47890 (``Notice'').
    \4\ See Securities Exchange Act Release No. 67892 (September 19,
2012), 77 FR 59029.
    \5\ See letter to Elizabeth M. Murphy, Secretary, Commission,
from Christopher Nagy, President, KOR Trading LLC, dated August 17,
2012 (``KOR Letter'').
    \6\ See letter to Elizabeth M. Murphy, Secretary, Commission,
from Jenny Klebes-Golding, Senior Attorney, CBOE, dated September 6,
2012 (``CBOE Letter'').
---------------------------------------------------------------------------

II. Description of the Proposal

    Currently, the maximum term for equity and interest rate LEAPS is
36 months (three years) and the maximum term for index LEAPS is 60
months (five years). CBOE proposes to amend CBOE Rules 5.8, 23.5(b) and
24.9(b) to increase the maximum term for all LEAPS to 180 months
(fifteen years).\7\ CBOE notes that similar fifteen year maximum terms
exist for FLEX Options.\8\
---------------------------------------------------------------------------

    \7\ CBOE also proposes to make technical, non-substantive
changes to CBOE Rules 5.8 and 24.9 to delete ``[supreg]'' symbols.
    \8\ See Securities Exchange Act Release No. 58890 (October 30,
2008), 73 FR 66085 (November 6, 2008) and CBOE Rules 24A.4(a)(2)(iv)
and 24B.4(a)(2)(iv).
---------------------------------------------------------------------------

    CBOE states that expanding the eligible term for all LEAPS to
fifteen years would allow the Exchange to offer products in an
exchange-traded environment that could compete with comparable over-the
counter (``OTC'') products. According to CBOE, it has received numerous
requests from market participants that currently enter into OTC
positions that have longer-dated expirations than are currently
available on CBOE to list LEAPS with longer dated expirations on the
Exchange. CBOE represents that it has confirmed that the OCC can
configure its systems to support LEAPS that have a maximum term of
fifteen years.

III. Discussion and Commission Findings

    After careful review, the Commission finds that the proposed rule
change is consistent with the requirements of the Act and the rules and
regulations thereunder applicable to a national securities exchange.\9\
Specifically, the Commission finds that the proposal is consistent with
Section 6(b)(5) of the Act,\10\ which requires, among other things,
that the rules of a national securities exchange be designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \9\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
    \10\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    KOR suggests that CBOE's proposal lacks data evidencing actual
interest in extended LEAPS terms.\11\ With regard to interest in the
proposed product, CBOE responds that its proposal is geared toward an
unmet demand of institutional investors, and was prompted by numerous
requests from market participants, such as insurance companies offering
equity-linked variable annuities, that have typically turned to OTC
dealers to trade options with longer-dated expirations.\12\ CBOE also
states that it believes that additional institutional demand for
longer-dated LEAPS (such as, for example, S&P 500 Index options) would
come from sell-side firms hedging longer-dated OTC instruments (such
as, for example, S&P variance).\13\ Further, CBOE states that virtually
all of the firms it queried suggested that the ideal maturity for
hedging trading activity exceeds the 10-year mark and that it seeks to
offer various maturities (particularly in S&P 500 Index options) out to
fifteen years in order to provide a more robust and flexible market for
longer-dated options.
---------------------------------------------------------------------------

    \11\ See KOR Letter, supra note 5.
    \12\ See CBOE Letter, supra note 6.
    \13\ Id.
---------------------------------------------------------------------------

    KOR also expresses concern that the proposal does not specify
classes to which the proposal would apply and that the proposal could
unduly burden the market through its potential impact on quote traffic
and the costs associated with disseminating and maintaining the data
for longer-termed LEAPS.\14\ CBOE states that it does not currently
know all of the specific classes for which there will be future market
demand for longer-dated LEAPS, and thus it is unable to identify such
classes at this time.\15\ CBOE notes, however, that S&P 500 Index
options are one of the classes that it anticipates would underlie
longer-dated LEAPS.\16\ CBOE also states that it does not expect there
to be a significant increase to quote traffic because CBOE anticipates
listing longer-dated LEAPS in response to specific market demand and
does not expect to significantly populate expirations.\17\ In addition,
CBOE notes that certain liquidity providers are not subject to quoting
obligations for LEAPS, which will assist with quote traffic
mitigation.\18\
---------------------------------------------------------------------------

    \14\ See KOR Letter, supra note 5.
    \15\ See CBOE Letter, supra note 6.
    \16\ Id.
    \17\ Id.
    \18\ Id.
---------------------------------------------------------------------------

    Given CBOE's representation that there is demand for options with
longer-dated expirations from institutional investors who are currently
trading such options in the OTC market,\19\ the Commission believes
that the proposal is reasonably designed to provide such investors with
additional means of hedging equity portfolios from long-term market
risk with an exchange-traded standardized security, thereby
facilitating transactions in options and contributing to the protection
of investors and the maintenance of fair and orderly markets. The
Commission notes that fifteen-year expirations are already permitted
for non-standardized FLEX Options.\20\ In addition, the Commission
notes the Exchange's representation that it does not anticipate a
significant increase in quote traffic.\21\ Accordingly, for the reasons
discussed above, the Commission believes that the proposed rule change
is consistent with the Act.
---------------------------------------------------------------------------

    \19\ See Notice; see also CBOE Letter, supra note 6.
    \20\ See supra note 8.
    \21\ See CBOE Letter, supra note 6.
---------------------------------------------------------------------------

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\22\ that the proposed rule change (SR-CBOE-2012-071) be, and it
hereby is, approved.
---------------------------------------------------------------------------

    \22\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\23\
---------------------------------------------------------------------------

    \23\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-27510 Filed 11-9-12; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: May 9, 2007 (Volume 72, Number 89)]
[Notices]
[Page 26430-26432]
[DOCID:fr09my07-129]

=======================================================================
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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55677; File No. SR-CBOE-2007-32]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change Relating to Transaction Fees for Certain Electronically
Executed Orders

 April 27, 2007
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on March 29, 2007, the Chicago Board Options Exchange, Incorporated
(``CBOE'' or ``Exchange'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule change as described in
Items I, II, and III below, which Items have been substantially
prepared by the CBOE. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend the CBOE Fees Schedule (``Fees
Schedule'') to increase transaction fees for certain electronically
executed orders. The text of the proposed rule change is available at
the CBOE, on the Exchange's Web site at http://www.cboe.org/legal, and

in the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    Currently, the Exchange charges $.25 per contract for broker-dealer
transactions and $.26 per contract for non-member market-maker
transactions, except for such transactions in options on the S&P 100
Index (``OEX'' and ``XEO'') and options on the S&P 500 (``SPX''), which
are charged $.30 per contract for broker-dealer and market-maker
transactions and $.40 per contract for broker-dealer and market-maker
transactions, respectively. The purpose of this proposed rule change is
to amend the Fees Schedule to establish a higher fee for
``electronically executed'' broker-dealer and non-member market-maker
orders, i.e., broker-dealer and non-member market-maker orders that are
automatically executed on the CBOE Hybrid Trading System (``Hybrid'').
    The Exchange proposes to assess electronically executed broker-
dealer and non-member market-maker orders a transaction fee of $.45 per
contract. Manually executed broker-dealer and non-member market-maker
orders would be assessed a transaction fee of $.25 per contract. The
$.26 per contract non-member market-maker transaction fee would be
deleted from the Fees Schedule. OEX, XEO and SPX broker-dealer and non-
member market-maker fees would remain unchanged. Broker-dealer and non-
member market-maker orders for options on the Morgan Stanley Retail
Index (``MVR'') would be charged $.25 per contract.\3\ A new Footnote
16 is proposed to be added to the Fees Schedule clarifying that the
broker-dealer manual and electronic transaction fees apply to broker-
dealer orders (orders with ``B'' origin code), non-member market-maker
orders (orders with ``N'' origin code), and orders from specialists in
the underlying security (orders with ``Y'' origin code).
---------------------------------------------------------------------------

    \3\ OEX, MVR and SPX are currently non-Hybrid classes.
---------------------------------------------------------------------------

    No changes are proposed to Linkage order fees. The proposed broker-
dealer electronic transaction fee is comparable to the RAES Access Fee
assessed by the Exchange on certain orders executed through the RAES
system in non-Hybrid classes, which is a fee assessed in addition to
standard transaction fees.\4\ Like the RAES Access Fee, the Exchange
believes the proposed broker-dealer electronic transaction fee will
help allocate to such orders a fair share of the costs of running the
automatic execution feature of Hybrid and related Exchange systems.
---------------------------------------------------------------------------

    \4\ See CBOE Fees Schedule, Section 4.
---------------------------------------------------------------------------

    The proposed fees are modeled after the broker-dealer transaction
fees of the NYSE Arca, Inc. (``NYSE Arca'').\5\ The Exchange believes
its proposed $.45 per contract fee is reasonable in that it is less
than the $.50 per contract fee assessed by NYSE Arca on electronically
executed broker-dealer and non-member market-maker orders.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 54309 (August 11,
2006), 71 FR 48571 (August 21, 2006) (SR-NYSEArca-2006-25).
---------------------------------------------------------------------------

2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the
Act,\6\ in general, and furthers the objectives of Section 6(b)(4) \7\
of the Act, in particular, in that it is designed to provide for the
equitable allocation of reasonable dues, fees, and other charges among
CBOE members and other persons using its facilities.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    CBOE does not believe that the proposed rule change will impose any
burden on competition that is not necessary or appropriate in
furtherance of purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others

    No written comments were solicited or received with respect to the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Because the foregoing rule change establishes or changes a due,
fee, or other charge imposed by the Exchange, it has become effective
pursuant to Section 19(b)(3)(A) of the Act \8\ and subparagraph (f)(2)
of Rule 19b-4\9\ thereunder. At any time within 60 days of the filing
of the proposed rule change, the Commission may summarily abrogate such
rule change if it appears to the Commission that such action is
necessary or appropriate in the public interest, for the protection of
investors, or otherwise in furtherance of the purposes of the Act.\10\
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(2).
    \10\ Id.
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml.
); or     Send an e-mail to<EMAIL_ADDRESS>Please include

File Number SR-CBOE-2007-32 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, 100 F Street, NE,
Washington, DC 20549-1090.
    All submissions should refer to File Number SR-CBOE-2007-32. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml
). Copies of the submission, all subsequent amendments,

all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for inspection
and copying in the Commission's Public Reference Room. Copies of such
filing also will be available for inspection and copying at the
principal office of the CBOE. All comments received will be posted
without change; the Commission does not edit personal identifying

information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-CBOE-2007-32 and should be submitted on or before May
30, 2007.

    For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-8812 Filed 5-8-07; 8:45 am]

BILLING CODE 8010-01-P