b. In paragraph (c)(2), by revising the words ``for the control period
under paragraph (b)(1)(ii) of this section and for the control periods
under paragraph (b)(2) of this section'' to read ``for the control
periods under paragraphs (b)(1)(ii) and (2) of this section'';
0
c. In paragraph (d)(2), by revising the words ``for the control period
under paragraph (b)(1)(ii) of this section and the control periods
under paragraph (b)(2) of this section'' to read ``for the control
periods under paragraphs (b)(1)(ii) and (2) of this section'';
0
d. In paragraph (d)(3), by revising the words ``for such control
period'' to read ``for such control periods'';
0
e. In paragraph (h)(2), revising the words ``a CAIR opt-in unit'' to
read ``a CAIR NOX Ozone Season opt-in unit.''

0
86. Section 96.385 is amended as follows:
0
a. In paragraph (a)(5), by revising the words ``under Sec.  96.388(c)''
to read ``Sec.  96.388(b) or Sec.  96.388(c)''; and
0
b. By adding a new paragraph (c) to read as follows:

Sec.  96.385  CAIR opt-in permit contents.

* * * * *
    (c) The CAIR opt-in permit shall be included, in a format specified
by the permitting authority, in the CAIR permit for the source where
the CAIR NOX Ozone Season opt-in unit is located and in a
title V operating permit or other federally enforceable permit for the
source.

Sec.  96.386  [Amended]

0
87. Section 96.386 is amended as follows:
0
a. In paragraph (a), by revising the words ``CAIR opt-in unit'' to read
``CAIR NOX Ozone Season opt-on unit'';
0
b. In paragraph (b)(2), by replacing the words ``equal in number to''
to read ``equal in amount to''; and
0
c. In paragraphs (c)(2) and (g), by revising the words ``CAIR
NOX opt-in unit'' to read ``CAIR NOX Ozone Season
opt-in unit''.
0
88. Section 96.387 is amended as follows:
0
a. In paragraph (b)(1), by revising the words ``under Sec.  96.323'' to
read ``under Sec.  96.323, and remove the CAIR opt-in permit
provisions,'';
0
b. In paragraph (b)(2)(i), by revising the words ``equal in number to''
to read ``equal in amount to'';
0
c. By revising paragraph (b)(3)(i);
0
d. In paragraph (b)(3)(ii), by revising the words ``Notwithstanding
paragraph (b)(3)(i) of this section if,'' to read ``If'', by revising
the words ``May 1'' to read ``September 30'', and by revising the words
``number of CAIR NOX Ozone Season allowances'' to read
``amount of CAIR NOX Ozone Season allowances''; and
0
e. In paragraph (b)(3)(ii)(A), by revising the words ``number of CAIR
NOX Ozone Season allowances'' to read ``amount of CAIR
NOX Ozone Season allowances'' and revising to read as
follows:

Sec.  96.387   Change in regulatory status.

* * * * *
    (b) * * *
    (3)(i) For every control period after the date on which the CAIR
NOX Ozone Season opt-in unit becomes a CAIR NOX
Ozone Season unit under Sec.  96.304, the CAIR NOX Ozone
Season opt-in unit will be allocated CAIR NOX Ozone Season
allowances under Sec.  96.342.
* * * * *

Sec.  96.388   CAIR NOX Ozone Season allowance allocations
to CAIR NOX Ozone Season opt-in units.

0
89. Section 96.388 is amended as follows:
0
a. By revising the heading of the section as set forth above;
0
b. In paragraph (a)(2), by revising the words ``of the control period
in which'' to read ``of the control period after the control period in
which'', by revising the words ``CAIR opt-in unit'' to read ``CAIR
NOX Ozone Season opt-in unit'', and by revising the words
``CAIR NOX opt-in unit'' to read ``CAIR NOX Ozone
Season opt-in unit'';
0
c. In paragraph (c), by revising the words ``issues a CAIR opt-in
permit'' to read ``issues a CAIR opt-in permit'' (based on a
demonstration of the intent to repower stated under Sec.
96.383(a)(5)); and
0
d. In paragraph (d)(2), by revising the words ``CAIR opt-in unit'' to
read ``CAIR NOX Ozone Season opt-in unit.''

PART 97--FEDERAL NOX BUDGET TRADING PROGRAM AND CAIR
NOX AND SO2 TRADING PROGRAMS

0
1. The heading of part 97 is revised to read as set forth above.

0
2. The authority citation for part 97 is revised to read as follows:

    Authority: 42 U.S.C. 7401, 7403, 7410, 7426, 7601, and 7651, et
seq.

0
3. Part 97 is amended by adding subparts AA through II, to read as
follows:
Subpart AA--CAIR NOX Annual Trading Program General
Provisions
Sec.
97.101 Purpose.
97.102 Definitions.
97.103 Measurements, abbreviations, and acronyms.
97.104 Applicability.
97.105 Retired unit exemption.

97.106 Standard requirements.
97.107 Computation of time.
97.108 Appeal procedures.
Subpart BB--CAIR Designated Representative for CAIR NOX
Sources
97.110 Authorization and responsibilities of CAIR designated
representative.
97.111 Alternate CAIR designated representative.
97.112 Changing CAIR designated representative and alternate CAIR
designated representative; changes in owners and operators.
97.113 Certificate of representation.
97.114 Objections concerning CAIR designated representative.
97.115 Delegation by CAIR designated representative and alternate
CAIR designated representative.
Subpart CC--Permits
97.120 General CAIR NOX Annual Trading Program permit
requirements.
97.121 Submission of CAIR permit applications.
97.122 Information requirements for CAIR permit applications.
97.123 CAIR permit contents and term.
97.124 CAIR permit revisions.
Subpart DD--[Reserved]
Subpart EE--CAIR NOX Allowance Allocations
97.140 State trading budgets.
97.141 Timing requirements for CAIR NOX allowance
allocations.
97.142 CAIR NOX allowance allocations.
97.143 Compliance supplement pool.
97.144 Alternative of allocation of CAIR NOX allowances
and compliance supplement pool by permitting authority.

Appendix A to Subpart EE of Part 97--States With Approved State
Implementation Plan Revisions Concerning Allocations

Subpart FF-- CAIR NOX Allowance Tracking System
97.150 [Reserved]
97.151 Establishment of accounts.
97.152 Responsibilities of CAIR authorized account representative.
97.153 Recordation of CAIR NOX allowance allocations.
97.154 Compliance with CAIR NOX emissions limitation.
97.155 Banking.
97.156 Account error.
97.157 Closing of general accounts.
Subpart GG--CAIR NOX Allowance Transfers
97.160 Submission of CAIR NOX allowance transfers.
97.161 EPA recordation.
97.162 Notification.
Subpart HH--Monitoring and Reporting
97.170 General requirements.
97.171 Initial certification and recertification procedures.
97.172 Out of control periods.
97.173 Notifications.
97.174 Recordkeeping and reporting.
97.175 Petitions.
Subpart II--CAIR NOX Opt-in Units
97.180 Applicability.
97.181 General.
97.182 CAIR designated representative.
97.183 Applying for CAIR opt-in permit.
97.184 Opt-in process.
97.185 CAIR opt-in permit contents.
97.186 Withdrawal from CAIR NOX Annual Trading Program.
97.187 Change in regulatory status.
97.188 CAIR NOX allowance allocations to CAIR
NOX opt-in units.

Appendix A to Subpart II of Part 97--States With Approved State
Implementation Plan Revisions Concerning CAIR NOX Opt-in
Units

Subpart AA--CAIR NOX Annual Trading Program General
Provisions

Sec.  97.101  Purpose.

    This subpart and subparts BB through II set forth the general
provisions and the designated representative, permitting, allowance,
monitoring, and opt-in provisions for the Federal Clean Air Interstate
Rule (CAIR) NOX Annual Trading Program, under section 110 of
the Clean Air Act and Sec.  52.35 of this chapter, as a means of
mitigating interstate transport of fine particulates and nitrogen
oxides.

Sec.  97.102  Definitions.

    The terms used in this subpart and subparts BB through II shall
have the meanings set forth in this section as follows:
    Account number means the identification number given by the
Administrator to each CAIR NOX Allowance Tracking System
account.
    Acid Rain emissions limitation means a limitation on emissions of
sulfur dioxide or nitrogen oxides under the Acid Rain Program.
    Acid Rain Program means a multi-state sulfur dioxide and nitrogen
oxides air pollution control and emission reduction program established
by the Administrator under title IV of the CAA and parts 72 through 78
of this chapter.
    Actual weighted average NOX emission rate means, for a
NOX averaging plan under Sec.  76.11 of this chapter and for
a year:
    (1) The sum of the products of the actual annual average
NOX emission rate and actual annual heat input (as
determined in accordance with part 75 of this chapter) for all units in
the NOX averaging plan for the year; divided by
    (2) The sum of the actual annual heat input (as determined in
accordance with part 75 of this chapter) for all units in the
NOX averaging plan for the year.
    Administrator means the Administrator of the United States
Environmental Protection Agency or the Administrator's duly authorized
representative.
    Allocate or allocation means, with regard to CAIR NOX
allowances, the determination by a permitting authority or the
Administrator of the amount of such CAIR NOX allowances to
be initially credited to a CAIR NOX unit, a new unit set-
aside, or other entity.
    Allowance transfer deadline means, for a control period, 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
following the control period and is the deadline by which a CAIR
NOX allowance transfer must be submitted for recordation in
a CAIR NOX source's compliance account in order to be used
to meet the source's CAIR NOX emissions limitation for such
control period in accordance with Sec.  97.154.
    Alternate CAIR designated representative means, for a CAIR
NOX source and each CAIR NOX 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 subparts BB
and II of this part, to act on behalf of the CAIR designated
representative in matters pertaining to the CAIR NOX Annual
Trading Program. If the CAIR NOX source is also a CAIR
SO2 source, then this natural person shall be the same
person as the alternate CAIR designated representative under the CAIR
SO2 Trading Program. If the CAIR NOX source is
also a CAIR NOX Ozone Season source, then this natural
person shall be the same person as the alternate CAIR designated
representative under the CAIR NOX Ozone Season Trading
Program. If the CAIR NOX source is also subject to the Acid
Rain Program, then this natural person shall be the same person as the
alternate designated representative under the Acid Rain Program. If the
CAIR NOX source is also subject to the Hg Budget Trading
Program, then this natural person shall be the same person as the
alternate Hg designated representative under the Hg Budget Trading
Program.
    Automated data acquisition and handling system or DAHS means that
component of the continuous emission monitoring system, or other
emissions monitoring system approved for use under subpart HH of this
part, 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 subpart HH of this part.

    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 cogeneration unit means a cogeneration unit in
which the energy input to the unit is first used to produce useful
thermal energy and at least some of the reject heat from the useful
thermal energy application or process is then used for electricity
production.
    CAIR authorized account representative means, with regard to a
general account, a responsible natural person who is authorized, in
accordance with subparts BB, FF, and II of this part, to transfer and
otherwise dispose of CAIR NOX allowances held in the general
account and, with regard to a compliance account, the CAIR designated
representative of the source.
    CAIR designated representative means, for a CAIR NOX
source and each CAIR NOX 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 subparts BB and II of
this part, to represent and legally bind each owner and operator in
matters pertaining to the CAIR NOX Annual Trading Program.
If the CAIR NOX source is also a CAIR SO2 source,
then this natural person shall be the same person as the CAIR
designated representative under the CAIR SO2 Trading
Program. If the CAIR NOX source is also a CAIR
NOX Ozone Season source, then this natural person shall be
the same person as the CAIR designated representative under the CAIR
NOX Ozone Season Trading Program. If the CAIR NOX
source is also subject to the Acid Rain Program, then this natural
person shall be the same person as the designated representative under
the Acid Rain Program. If the CAIR NOX source is also
subject to the Hg Budget Trading Program, then this natural person
shall be the same person as the Hg designated representative under the
Hg Budget Trading Program.
    CAIR NOX allowance means a limited authorization issued by a
permitting authority or the Administrator under subpart EE of this part
or Sec.  97.188, or under provisions of a State implementation plan
that are approved under Sec.  51.123(o)(1) or (2) or (p) of this
chapter, to emit one ton of nitrogen oxides during a control period of
the specified calendar year for which the authorization is allocated or
of any calendar year thereafter under the CAIR NOX Program.
An authorization to emit nitrogen oxides that is not issued under
subpart EE of this part, Sec.  97.188, or provisions of a State
implementation plan that are approved under Sec.  51.123(o)(1) or (2)
or (p) of this chapter shall not be a CAIR NOX allowance.
    CAIR NOX allowance deduction or deduct CAIR NOX allowances means
the permanent withdrawal of CAIR NOX allowances by the
Administrator from a compliance account, e.g., in order to account for
a specified number of tons of total nitrogen oxides emissions from all
CAIR NOX units at a CAIR NOX source for a control
period, determined in accordance with subpart HH of this part, or to
account for excess emissions.
    CAIR NOX Allowance Tracking System means the system by which the
Administrator records allocations, deductions, and transfers of CAIR
NOX allowances under the CAIR NOX Annual Trading
Program. Such allowances will be allocated, held, deducted, or
transferred only as whole allowances.
    CAIR NOX Allowance Tracking System account means an account in the
CAIR NOX Allowance Tracking System established by the
Administrator for purposes of recording the allocation, holding,
transferring, or deducting of CAIR NOX allowances.
    CAIR NOX allowances held or hold CAIR NOX allowances means the CAIR
NOX allowances recorded by the Administrator, or submitted
to the Administrator for recordation, in accordance with subparts FF,
GG, and II of this part, in a CAIR NOX Allowance Tracking
System account.
    CAIR NOX Annual Trading Program means a multi-state nitrogen oxides
air pollution control and emission reduction program established by the
Administrator in accordance with subparts AA through II of this part
and Sec. Sec.  51.123(p) and 52.35 of this chapter or approved and
administered by the Administrator in accordance with subparts AA
through II of part 96 of this chapter and Sec.  51.123(o)(1) or (2) of
this chapter, as a means of mitigating interstate transport of fine
particulates and nitrogen oxides.
    CAIR NOX emissions limitation means, for a CAIR NOX
source, the tonnage equivalent, in NOX emissions in a
control period, of the CAIR NOX allowances available for
deduction for the source under Sec.  97.154(a) and (b) for the control
period.
    CAIR NOX Ozone Season source means a source that is subject to the
CAIR NOX Ozone Season Trading Program.
    CAIR NOX Ozone Season Trading Program means a multi-state nitrogen
oxides air pollution control and emission reduction program established
by the Administrator in accordance with subparts AAAA through IIII of
this part and Sec. Sec.  51.123(ee) and 52.35 of this chapter or
approved and administered by the Administrator in accordance with under
subparts AAAA through IIII and Sec.  51.123(aa)(1) or (2) (and
(bb)(1)), (bb)(2), or (dd) of this chapter, as a means of mitigating
interstate transport of ozone and nitrogen oxides.
    CAIR NOX source means a source that includes one or more CAIR
NOX units.
    CAIR NOX unit means a unit that is subject to the CAIR
NOX Annual Trading Program under Sec.  97.104 and, except
for purposes of Sec.  97.105 and subpart EE of this part, a CAIR
NOX opt-in unit under subpart II of this part.
    CAIR permit means the legally binding and federally enforceable
written document, or portion of such document, issued by the permitting
authority under subpart CC of this part, including any permit
revisions, specifying the CAIR NOX Annual Trading Program
requirements applicable to a CAIR NOX source, to each CAIR
NOX unit at the source, and to the owners and operators and
the CAIR designated representative of the source and each such unit.
    CAIR SO2 source means a source that is subject to the CAIR
SO2 Trading Program.
    CAIR SO2 Trading Program means a multi-state sulfur dioxide air
pollution control and emission reduction program established by the
Administrator in accordance with subparts AAA through III of this part
and Sec. Sec.  51.124(r) and 52.36 of this chapter or approved and
administered by the Administrator in accordance with subparts AAA
through III of part 96 of this chapter and Sec.  51.124(o)(1) or (2) of
this chapter, as a means of mitigating interstate transport of fine
particulates and sulfur dioxide.
    Certifying official means:
    (1) For a corporation, a president, secretary, treasurer, or vice-
president or 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 or CAA means the Clean Air Act, 42 U.S.C. 7401, et
seq.
    Coal means any solid fuel classified as anthracite, bituminous,
subbituminous, or lignite.
    Coal-derived fuel means any fuel (whether in a solid, liquid, or
gaseous state) produced by the mechanical, thermal, or chemical
processing of coal.
    Coal-fired means:

    (1) Except for purposes of subpart EE of this part, combusting any
amount of coal or coal-derived fuel, alone or in combination with any
amount of any other fuel, during any year; or
    (2) For purposes of subpart EE of this part, combusting any amount
of coal or coal-derived fuel, alone or in combination with any amount
of any other fuel, during a specified year.
    Cogeneration unit means a stationary, fossil-fuel-fired boiler or
stationary, fossil-fuel-fired combustion turbine:
    (1) Having equipment used to produce electricity and useful thermal
energy for industrial, commercial, heating, or cooling purposes through
the sequential use of energy; and
    (2) Producing during the 12-month period starting on the date the
unit first produces electricity and during any calendar year after the
calendar year in which the unit first produces electricity--
    (i) For a topping-cycle cogeneration 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 then 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 cogeneration unit, useful power not less
than 45 percent of total energy input.
    Combustion turbine means:
    (1) An enclosed device comprising 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 enclosed device under paragraph (1) of this definition
is combined cycle, 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.  97.105 and Sec.  97.184(h).
    (i) For a unit that is a CAIR NOX unit under Sec.
97.104 on the later of November 15, 1990 or the date the unit commences
commercial operation as defined in paragraph (1) of this definition and
that subsequently undergoes a physical change (other than replacement
of the unit by a unit at the same 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 CAIR NOX unit under Sec.
97.104 on the later of November 15, 1990 or the date the unit commences
commercial operation as defined in paragraph (1) of this definition and
that is subsequently replaced by a unit at the same source (e.g.,
repowered), 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.  97.105, for a unit that is not a CAIR NOX
unit under Sec.  97.104 on the later of November 15, 1990 or the date
the unit commences commercial operation as defined in paragraph (1) of
this definition, the unit's date for commencement of commercial
operation shall be the date on which the unit becomes a CAIR
NOX unit under Sec.  97.104.
    (i) For a unit with a date for commencement of commercial operation
as defined in paragraph (2) of this definition and that subsequently
undergoes a physical change (other than replacement of the unit by a
unit at the same 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 paragraph (2) of this definition and that is
subsequently replaced by a unit at the same source (e.g., repowered),
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.
    Commence operation means:
    (1) To have begun any mechanical, chemical, or electronic process,
including, with regard to a unit, start-up of a unit's combustion
chamber, except as provided in Sec.  97.184(h).
    (2) For a unit that undergoes a physical change (other than
replacement of the unit by a unit at the same source) after the date
the unit commences operation as defined in paragraph (1) of this
definition, such date shall remain the date of commencement of
operation of the unit, which shall continue to be treated as the same
unit.
    (3) For a unit that is replaced by a unit at the same source (e.g.,
repowered) after the date the unit commences operation as defined in
paragraph (1) of this definition, such date shall remain the replaced
unit's date of commencement of operation, and the replacement unit
shall be treated as a separate unit with a separate date for
commencement of operation as defined in paragraph (1), (2), or (3) of
this definition as appropriate, except as provided in Sec.  97.184(h).
    Common stack means a single flue through which emissions from 2 or
more units are exhausted.
    Compliance account means a CAIR NOX Allowance Tracking
System account, established by the Administrator for a CAIR
NOX source under subpart FF or II of this part, in which any
CAIR NOX allowance allocations for the CAIR NOX
units at the source are initially recorded and in which are held any
CAIR NOX allowances available for use for a control period
in order to meet the source's CAIR NOX emissions limitation
in accordance with Sec.  97.154.
    Continuous emission monitoring system or CEMS means the equipment
required under subpart HH of this part to sample, analyze, measure, and
provide, by means of readings recorded at least once every 15 minutes
(using an automated data acquisition and handling system (DAHS)), a
permanent record of nitrogen oxides emissions, stack gas volumetric
flow rate, stack gas moisture content, and oxygen or carbon dioxide
concentration (as applicable), in a manner consistent with part 75 of
this chapter. The following systems are the principal types of
continuous emission monitoring systems required under subpart HH of
this part:
    (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 nitrogen oxides concentration monitoring system, consisting
of a NOX pollutant concentration monitor and an automated
data acquisition and handling system and providing a permanent,
continuous record of NOX emissions, in parts per million
(ppm);
    (3) A nitrogen oxides emission rate (or NOX-diluent)
monitoring system, consisting of a NOX pollutant
concentration monitor, a diluent gas (CO2 or O2)
monitor, and an automated data acquisition and handling system and
providing a permanent, continuous record of NOX
concentration, in parts per million (ppm), diluent gas

concentration, in percent CO2 or O2, and
NOX emission rate, in pounds per million British thermal
units (lb/mmBtu);
    (4) 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;
    (5) A carbon dioxide monitoring system, consisting of a
CO2 pollutant concentration monitor (or an oxygen 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
    (6) An oxygen 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 beginning January 1 of a calendar
year, except as provided in Sec.  97.106(c)(2), and ending on December
31 of the same year, inclusive.
    Emissions means air pollutants exhausted from a unit or source into
the atmosphere, as measured, recorded, and reported to the
Administrator by the CAIR designated representative and as determined
by the Administrator in accordance with subpart HH of this part.
    Excess emissions means any ton of nitrogen oxides emitted by the
CAIR NOX units at a CAIR NOX source during a
control period that exceeds the CAIR NOX emissions
limitation for the source.
    Fossil fuel means natural gas, petroleum, coal, or any form of
solid, liquid, or gaseous fuel derived from such material.
    Fossil-fuel-fired means, with regard to a unit, combusting any
amount of fossil fuel in any calendar year.
    Fuel oil means any petroleum-based fuel (including diesel fuel or
petroleum derivatives such as oil tar) and any recycled or blended
petroleum products or petroleum by-products used as a fuel whether in a
liquid, solid, or gaseous state.
    General account means a CAIR NOX Allowance Tracking
System account, established under subpart FF of this part, that is not
a compliance account.
    Generator means a device that produces electricity.
    Gross electrical output means, with regard to a cogeneration 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, with regard to a specified period of time, the
product (in mmBtu/time) of the gross calorific value of the fuel (in
Btu/lb) divided by 1,000,000 Btu/mmBtu and multiplied by the fuel feed
rate into a combustion device (in lb of fuel/time), as measured,
recorded, and reported to the Administrator by the CAIR designated
representative and determined by the Administrator in accordance with
subpart HH of this part and excluding the heat derived from preheated
combustion air, recirculated flue gases, or exhaust from other sources.
    Heat input rate means the amount of heat input (in mmBtu) divided
by unit operating time (in hr) or, with regard to 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.
    Hg Budget Trading Program means a multi-state Hg air pollution
control and emission reduction program approved and administered by the
Administrator in accordance subpart HHHH of part 60 of this chapter and
Sec.  60.24(h)(6), or established by the Administrator under section
111 of the Clean Air Act, as a means of reducing national Hg emissions.
    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 the maximum amount of fuel per hour
(in Btu/hr) that a 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 subpart HH of this part, including a continuous
emissions monitoring system, an alternative monitoring system, or an
excepted monitoring system under part 75 of this chapter.
    Most stringent State or Federal NOX emissions limitation
means, with regard to a unit, the lowest NOX emissions
limitation (in terms of lb/mmBtu) that is applicable to the unit under
State or Federal law, regardless of the averaging period to which the
emissions limitation applies.
    Nameplate capacity means, starting from the initial installation of
a generator, the maximum electrical generating output (in MWe) 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 (in MWe) 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 as of such completion as specified by the
person conducting the physical change.
    Oil-fired means, for purposes of subpart EE of this part,
combusting fuel oil for more than 15.0 percent of the annual heat input
in a specified year and not qualifying as coal-fired.
    Operator means any person who operates, controls, or supervises a
CAIR NOX unit or a CAIR NOX source and shall
include, but not be limited to, any holding company, utility system, or
plant manager of such a unit or source.
    Owner means any of the following persons:
    (1) With regard to a CAIR NOX source or a CAIR
NOX unit at a source, respectively:
    (i) Any holder of any portion of the legal or equitable title in a
CAIR NOX unit at the source or the CAIR NOX unit;
    (ii) Any holder of a leasehold interest in a CAIR NOX
unit at the source or the CAIR NOX unit; or
    (iii) Any purchaser of power from a CAIR NOX unit at the
source or the CAIR NOX unit under a life-of-the-unit, firm
power contractual arrangement; 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 CAIR NOX unit; or

    (2) With regard to any general account, any person who has an
ownership interest with respect to the CAIR NOX allowances
held in the general account and who is subject to the binding agreement
for the CAIR authorized account representative to represent the
person's ownership interest with respect to CAIR NOX
allowances.
    Permitting authority means the State air pollution control agency,
local agency, other State agency, or other agency authorized by the
Administrator to issue or revise permits to meet the requirements of
the CAIR NOX Annual Trading Program in accordance with
subpart CC of this part or, if no such agency has been so authorized,
the Administrator.
    Potential electrical output capacity means 33 percent of a 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 permitting
authority or 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 permitting authority or the Administrator in the regular course
of business.
    Recordation, record, or recorded means, with regard to CAIR
NOX allowances, the movement of CAIR NOX
allowances by the Administrator into or between CAIR NOX
Allowance Tracking System accounts, for purposes of allocation,
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 shutdown and permanent
disabling of a unit, and the construction of another unit (the
replacement unit) to be used instead of the demolished or shutdown unit
(the replaced unit).
    Repowered means, with regard to a unit, replacement of a coal-fired
boiler with one of the following coal-fired technologies at the same
source as the coal-fired boiler:
    (1) Atmospheric or pressurized fluidized bed combustion;
    (2) Integrated gasification combined cycle;
    (3) Magnetohydrodynamics;
    (4) Direct and indirect coal-fired turbines;
    (5) Integrated gasification fuel cells; or
    (6) As determined by the Administrator in consultation with the
Secretary of Energy, a derivative of one or more of the technologies
under paragraphs (1) through (5) of this definition and any other coal-
fired technology capable of controlling multiple combustion emissions
simultaneously with improved boiler or generation efficiency and with
significantly greater waste reduction relative to the performance of
technology in widespread commercial use as of January 1, 2005.
    Sequential use of energy means:
    (1) For a topping-cycle cogeneration unit, the use of reject heat
from electricity production in a useful thermal energy application or
process; or
    (2) For a bottoming-cycle cogeneration unit, the use of reject heat
from useful thermal energy application or process in electricity
production.
    Serial number means, for a CAIR NOX allowance, the
unique identification number assigned to each CAIR NOX
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. For purposes of section 502(c) of the Clean
Air Act, a ``source,'' including a ``source'' with multiple units,
shall be considered a single ``facility.''
    State means one of the States or the District of Columbia that is
subject to the CAIR NOX Annual Trading Program pursuant to
Sec.  52.35 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.
Compliance with any ``submission'' or ``service'' deadline shall be
determined by the date of dispatch, transmission, or mailing and not
the date of receipt.
    Title V operating permit means a permit issued under title V of the
Clean Air Act and part 70 or part 71 of this chapter.
    Title V operating permit regulations means the regulations that the
Administrator has approved or issued as meeting the requirements of
title V of the Clean Air Act and part 70 or 71 of this chapter.
    Ton means 2,000 pounds. For the purpose of determining compliance
with the CAIR NOX emissions limitation, total tons of
nitrogen oxides emissions for a control period shall be calculated as
the sum of all recorded hourly emissions (or the mass equivalent of the
recorded hourly emission rates) in accordance with subpart HH of this
part, but with any remaining fraction of a ton equal to or greater than
0.50 tons deemed to equal one ton and any remaining fraction of a ton
less than 0.50 tons deemed to equal zero tons.
    Topping-cycle cogeneration unit means a cogeneration unit in which
the energy input to the unit is first used to produce useful power,
including electricity, and at least some of the reject heat from the
electricity production is then used to provide useful thermal energy.
    Total energy input means, with regard to a cogeneration unit, total
energy of all forms supplied to the cogeneration unit, excluding energy
produced by the cogeneration unit itself.
    Total energy output means, with regard to a cogeneration unit, the
sum of useful power and useful thermal energy produced by the
cogeneration unit.
    Unit means a stationary, fossil-fuel-fired boiler or combustion
turbine or other stationary, fossil-fuel-fired combustion device.
    Unit operating day means a calendar day in which a unit combusts
any fuel.
    Unit operating hour or hour of unit operation means an hour in
which a unit combusts any fuel.
    Useful power means, with regard to a cogeneration unit, electricity
or mechanical energy made 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, with regard to a cogeneration unit,
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., thermal energy used
by 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.  97.103  Measurements, abbreviations, and acronyms.

    Measurements, abbreviations, and acronyms used in this subpart and
subparts BB through II are defined as follows:

Btu--British thermal unit
CO2--carbon dioxide
H2O--water
Hg--mercury
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.  97.104  Applicability

    (a) Except as provided in paragraph (b) of this section:
    (1) The following units in a State shall be CAIR NOX
units, and any source that includes one or more such units shall be a
CAIR NOX source, subject to the requirements of this subpart
and subparts BB through HH of this part: any stationary, fossil-fuel-
fired boiler or stationary, fossil-fuel-fired combustion turbine
serving at any time, since the later of November 15, 1990 or the start-
up of the unit's combustion chamber, 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 CAIR NOX
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 CAIR NOX 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) The units in a State that meet the requirements set forth in
paragraph (b)(1)(i), (b)(2)(i), or (b)(2)(ii) of this section shall not
be CAIR NOX units:
    (1)(i) Any unit that is a CAIR NOX unit under paragraph
(a)(1) or (2) of this section:
    (A) Qualifying as a cogeneration unit during the 12-month period
starting on the date the unit first produces electricity and continuing
to qualify as a cogeneration unit; and
    (B) Not serving at any time, since the later of November 15, 1990
or the start-up of the unit's combustion chamber, a generator with
nameplate capacity of more than 25 MWe supplying in any calendar year
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 a unit qualifies as a cogeneration unit during the 12-month
period starting on the date the unit first produces electricity and
meets the requirements of paragraphs (b)(1)(i) of this section for at
least one calendar year, but subsequently no longer meets all such
requirements, the unit shall become a CAIR NOX 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.
    (2)(i) Any unit that is a CAIR NOX unit under paragraph
(a)(1) or (2) of this section commencing operation before January 1,
1985:
    (A) Qualifying as a solid waste incineration unit; and
    (B) With an average annual fuel consumption of non-fossil fuel for
1985-1987 exceeding 80 percent (on a Btu basis) and an average annual
fuel consumption of non-fossil fuel for any 3 consecutive calendar
years after 1990 exceeding 80 percent (on a Btu basis).
    (ii) Any unit that is a CAIR NOX unit under paragraph
(a)(1) or (2) of this section commencing operation on or after January
1, 1985:
    (A) Qualifying as a solid waste incineration unit; and
    (B) With an average annual fuel consumption of non-fossil fuel for
the first 3 calendar years of operation exceeding 80 percent (on a Btu
basis) and an average annual fuel consumption of non-fossil fuel for
any 3 consecutive calendar years after 1990 exceeding 80 percent (on a
Btu basis).
    (iii) If a unit qualifies as a solid waste incineration unit and
meets the requirements of paragraph (b)(2)(i) or (ii) of this section
for at least 3 consecutive calendar years, but subsequently no longer
meets all such requirements, the unit shall become a CAIR
NOX 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 1990 for which the unit has an average
annual fuel consumption of fossil fuel of 20 percent or more.
    (c) A certifying official of an owner or operator of any unit may
petition the Administrator at any time for a determination concerning
the applicability, under paragraphs (a) and (b) of this section, of the
CAIR NOX Annual Trading Program to the unit.
    (1) Petition content. The petition shall be in writing and include
the identification of the unit and the relevant facts about the unit.
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 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) Submission. The petition and any other documents provided in
connection with the petition shall be submitted to the Director of the
Clean Air Markets Division (or its successor), U.S. Environmental
Protection Agency, who will act on the petition as the Administrator's
duly authorized representative.
    (3) Response. The Administrator will issue a written response to
the petition and may request supplemental information relevant to such
petition. The Administrator's determination concerning the
applicability, under paragraphs (a) and (b) of this section, of the
CAIR NOX Annual Trading Program to the unit shall be binding
on the permitting authority unless the petition or other information or
documents provided in connection with the petition are found to have
contained significant, relevant errors or omissions.

Sec.  97.105  Retired unit exemption.

    (a)(1) Any CAIR NOX unit that is permanently retired and
is not a CAIR NOX opt-in unit under subpart II of this part
shall be exempt from the CAIR NOX Annual Trading Program,
except for the provisions of this section, Sec. Sec.  97.102, 97.103,
97.104, 97.106(c)(4) through (7),

97.107, 97.108, and subparts BB and EE through GG of this part.
    (2) The exemption under paragraph (a)(1) of this section shall
become effective the day on which the CAIR NOX unit is
permanently retired. Within 30 days of the unit's permanent retirement,
the CAIR designated representative shall submit a statement to the
permitting authority otherwise responsible for administering any CAIR
permit for the unit and shall submit a copy of the statement to the
Administrator. The statement shall state, in a format prescribed by the
permitting authority, that the unit was permanently retired on a
specific date and will comply with the requirements of paragraph (b) of
this section.
    (3) After receipt of the statement under paragraph (a)(2) of this
section, the permitting authority will amend any permit under subpart
CC of this part covering the source at which the unit is located to add
the provisions and requirements of the exemption under paragraphs
(a)(1) and (b) of this section.
    (b) Special provisions. (1) A unit exempt under paragraph (a) of
this section shall not emit any nitrogen oxides, starting on the date
that the exemption takes effect.
    (2) The Administrator or the permitting authority will allocate
CAIR NOX allowances under subpart EE of this part to a unit
exempt under paragraph (a) of this section.
    (3) 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 permitting authority or the
Administrator. The owners and operators bear the burden of proof that
the unit is permanently retired.
    (4) The owners and operators and, to the extent applicable, the
CAIR designated representative of a unit exempt under paragraph (a) of
this section shall comply with the requirements of the CAIR
NOX Annual 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.
    (5) A unit exempt under paragraph (a) of this section and located
at a source that is required, or but for this exemption would be
required, to have a title V operating permit shall not resume operation
unless the CAIR designated representative of the source submits a
complete CAIR permit application under Sec.  97.122 for the unit not
less than 18 months (or such lesser time provided by the permitting
authority) before the later of January 1, 2009 or the date on which the
unit resumes operation.
    (6) On the earlier of the following dates, a unit exempt under
paragraph (a) of this section shall lose its exemption:
    (i) The date on which the CAIR designated representative submits a
CAIR permit application for the unit under paragraph (b)(5) of this
section;
    (ii) The date on which the CAIR designated representative is
required under paragraph (b)(5) of this section to submit a CAIR permit
application for the unit; or
    (iii) The date on which the unit resumes operation, if the CAIR
designated representative is not required to submit a CAIR permit
application for the unit.
    (7) For the purpose of applying monitoring, reporting, and
recordkeeping requirements under subpart HH of this part, a unit that
loses its exemption under paragraph (a) of this section shall be
treated as a unit that commences commercial operation on the first date
on which the unit resumes operation.

Sec.  97.106  Standard requirements.

    (a) Permit requirements. (1) The CAIR designated representative of
each CAIR NOX source required to have a title V operating
permit and each CAIR NOX unit required to have a title V
operating permit at the source shall:
    (i) Submit to the permitting authority a complete CAIR permit
application under Sec.  97.122 in accordance with the deadlines
specified in Sec.  97.121; and
    (ii) Submit in a timely manner any supplemental information that
the permitting authority determines is necessary in order to review a
CAIR permit application and issue or deny a CAIR permit.
    (2) The owners and operators of each CAIR NOX source
required to have a title V operating permit and each CAIR
NOX unit required to have a title V operating permit at the
source shall have a CAIR permit issued by the permitting authority
under subpart CC of this part for the source and operate the source and
the unit in compliance with such CAIR permit.
    (3) Except as provided in subpart II of this part, the owners and
operators of a CAIR NOX source that is not otherwise
required to have a title V operating permit and each CAIR
NOX unit that is not otherwise required to have a title V
operating permit are not required to submit a CAIR permit application,
and to have a CAIR permit, under subpart CC of this part for such CAIR
NOX source and such CAIR NOX unit.
    (b) Monitoring, reporting, and recordkeeping requirements. (1) The
owners and operators, and the CAIR designated representative, of each
CAIR NOX source and each CAIR NOX unit at the
source shall comply with the monitoring, reporting, and recordkeeping
requirements of subpart HH of this part.
    (2) The emissions measurements recorded and reported in accordance
with subpart HH of this part shall be used to determine compliance by
each CAIR NOX source with the CAIR NOX emissions
limitation under paragraph (c) of this section.
    (c) Nitrogen oxides emission requirements. (1) As of the allowance
transfer deadline for a control period, the owners and operators of
each CAIR NOX source and each CAIR NOX unit at
the source shall hold, in the source's compliance account, CAIR
NOX allowances available for compliance deductions for the
control period under Sec.  97.154(a) in an amount not less than the
tons of total nitrogen oxides emissions for the control period from all
CAIR NOX units at the source, as determined in accordance
with subpart HH of this part.
    (2) A CAIR NOX unit shall be subject to the requirements
under paragraph (c)(1) of this section for the control period starting
on the later of January 1, 2009 or the deadline for meeting the unit's
monitor certification requirements under Sec.  97.170(b)(1), (2), or
(5) and for each control period thereafter.
    (3) A CAIR NOX allowance shall not be deducted, for
compliance with the requirements under paragraph (c)(1) of this
section, for a control period in a calendar year before the year for
which the CAIR NOX allowance was allocated.
    (4) CAIR NOX allowances shall be held in, deducted from,
or transferred into or among CAIR NOX Allowance Tracking
System accounts in accordance with subparts EE, FF, GG, and II of this
part.
    (5) A CAIR NOX allowance is a limited authorization to
emit one ton of nitrogen oxides in accordance with the CAIR
NOX Annual Trading Program. No provision of the CAIR
NOX Annual Trading Program, the CAIR permit application, the
CAIR permit, or an exemption under Sec.  97.105 and no provision of law
shall be construed to limit the authority of the United States to
terminate or limit such authorization.
    (6) A CAIR NOX allowance does not constitute a property
right.
    (7) Upon recordation by the Administrator under subpart EE, FF,

GG, or II of this part, every allocation, transfer, or deduction of a
CAIR NOX allowance to or from a CAIR NOX source's
compliance account is incorporated automatically in any CAIR permit of
the source.
    (d) Excess emissions requirements. If a CAIR NOX source
emits nitrogen oxides during any control period in excess of the CAIR
NOX emissions limitation, then:
    (1) The owners and operators of the source and each CAIR
NOX unit at the source shall surrender the CAIR
NOX allowances required for deduction under Sec.
97.154(d)(1) and pay any fine, penalty, or assessment or comply with
any other remedy imposed, for the same violations, under the Clean Air
Act or applicable State law; and
    (2) Each ton of such excess emissions and each day of such control
period shall constitute a separate violation of this subpart, the Clean
Air Act, and applicable State law.
    (e) Recordkeeping and reporting requirements. (1) Unless otherwise
provided, the owners and operators of the CAIR NOX source
and each CAIR NOX unit at the source shall keep on site at
the source each of the following documents 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
permitting authority or the Administrator.
    (i) The certificate of representation under Sec.  97.113 for the
CAIR designated representative for the source and each CAIR
NOX 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 documents are
superseded because of the submission of a new certificate of
representation under Sec.  97.113 changing the CAIR designated
representative.
    (ii) All emissions monitoring information, in accordance with
subpart HH of this part, provided that to the extent that subpart HH of
this part provides for a 3-year period for recordkeeping, the 3-year
period shall apply.
    (iii) Copies of all reports, compliance certifications, and other
submissions and all records made or required under the CAIR
NOX Annual Trading Program.
    (iv) Copies of all documents used to complete a CAIR permit
application and any other submission under the CAIR NOX
Annual Trading Program or to demonstrate compliance with the
requirements of the CAIR NOX Annual Trading Program.
    (2) The CAIR designated representative of a CAIR NOX
source and each CAIR NOX unit at the source shall submit the
reports required under the CAIR NOX Annual Trading Program,
including those under subpart HH of this part.
    (f) Liability. (1) Each CAIR NOX source and each CAIR
NOX unit shall meet the requirements of the CAIR
NOX Annual Trading Program.
    (2) Any provision of the CAIR NOX Annual Trading Program
that applies to a CAIR NOX source or the CAIR designated
representative of a CAIR NOX source shall also apply to the
owners and operators of such source and of the CAIR NOX
units at the source.
    (3) Any provision of the CAIR NOX Annual Trading Program
that applies to a CAIR NOX unit or the CAIR designated
representative of a CAIR NOX unit shall also apply to the
owners and operators of such unit.
    (g) Effect on other authorities. No provision of the CAIR
NOX Annual Trading Program, a CAIR permit application, a
CAIR permit, or an exemption under Sec.  97.105 shall be construed as
exempting or excluding the owners and operators, and the CAIR
designated representative, of a CAIR NOX source or CAIR
NOX unit from compliance with any other provision of the
applicable, approved State implementation plan, a federally enforceable
permit, or the Clean Air Act.

Sec.  97.107  Computation of time.

    (a) Unless otherwise stated, any time period scheduled, under the
CAIR NOX Annual 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
CAIR NOX Annual 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 CAIR NOX Annual Trading Program, falls on a
weekend or a State or Federal holiday, the time period shall be
extended to the next business day.

Sec.  97.108  Appeal procedures.

    The appeal procedures for decisions of the Administrator under the
CAIR NOX Annual Trading Program are set forth in part 78 of
this chapter.

Subpart BB--CAIR Designated Representative for CAIR NOX
Sources

Sec.  97.110  Authorization and responsibilities of CAIR designated
representative.

    (a) Except as provided under Sec.  97.111, each CAIR NOX
source, including all CAIR NOX units at the source, shall
have one and only one CAIR designated representative, with regard to
all matters under the CAIR NOX Annual Trading Program
concerning the source or any CAIR NOX unit at the source.
    (b) The CAIR designated representative of the CAIR NOX
source shall be selected by an agreement binding on the owners and
operators of the source and all CAIR NOX units at the source
and shall act in accordance with the certification statement in Sec.
97.113(a)(4)(iv).
    (c) Upon receipt by the Administrator of a complete certificate of
representation under Sec.  97.113, the CAIR designated representative
of the source shall represent and, by his or her representations,
actions, inactions, or submissions, legally bind each owner and
operator of the CAIR NOX source represented and each CAIR
NOX unit at the source in all matters pertaining to the CAIR
NOX Annual Trading Program, notwithstanding any agreement
between the CAIR designated representative and such owners and
operators. The owners and operators shall be bound by any decision or
order issued to the CAIR designated representative by the permitting
authority, the Administrator, or a court regarding the source or unit.
    (d) No CAIR permit will be issued, no emissions data reports will
be accepted, and no CAIR NOX Allowance Tracking System
account will be established for a CAIR NOX unit at a source,
until the Administrator has received a complete certificate of
representation under Sec.  97.113 for a CAIR designated representative
of the source and the CAIR NOX units at the source.
    (e)(1) Each submission under the CAIR NOX Annual Trading
Program shall be submitted, signed, and certified by the CAIR
designated representative for each CAIR NOX source on behalf
of which the submission is made. Each such submission shall include the
following certification statement by the CAIR designated
representative: ``I am authorized to make this submission on behalf of
the owners and operators of the source or units 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) The permitting authority and the Administrator will accept or
act on a submission made on behalf of owner or operators of a CAIR
NOX source or a CAIR NOX unit only if the
submission has been made, signed, and certified in accordance with
paragraph (e)(1) of this section.

Sec.  97.111  Alternate CAIR designated representative.

    (a) A certificate of representation under Sec.  97.113 may
designate one and only one alternate CAIR designated representative,
who may act on behalf of the CAIR designated representative. The
agreement by which the alternate CAIR designated representative is
selected shall include a procedure for authorizing the alternate CAIR
designated representative to act in lieu of the CAIR designated
representative.
    (b) Upon receipt by the Administrator of a complete certificate of
representation under Sec.  97.113, any representation, action,
inaction, or submission by the alternate CAIR designated representative
shall be deemed to be a representation, action, inaction, or submission
by the CAIR designated representative.
    (c) Except in this section and Sec. Sec.  97.102, 97.110(a) and
(d), 97.112, 97.113, 97.115, 97.151 and 97.182, whenever the term
``CAIR designated representative'' is used in subparts AA through II of
this part, the term shall be construed to include the CAIR designated
representative or any alternate CAIR designated representative.

Sec.  97.112  Changing CAIR designated representative and alternate
CAIR designated representative; changes in owners and operators.

    (a) Changing CAIR designated representative. The CAIR designated
representative may be changed at any time upon receipt by the
Administrator of a superseding complete certificate of representation
under Sec.  97.113. Notwithstanding any such change, all
representations, actions, inactions, and submissions by the previous
CAIR designated representative before the time and date when the
Administrator receives the superseding certificate of representation
shall be binding on the new CAIR designated representative and the
owners and operators of the CAIR NOX source and the CAIR
NOX units at the source.
    (b) Changing alternate CAIR designated representative. The
alternate CAIR designated representative may be changed at any time
upon receipt by the Administrator of a superseding complete certificate
of representation under Sec.  97.113. Notwithstanding any such change,
all representations, actions, inactions, and submissions by the
previous alternate CAIR designated representative before the time and
date when the Administrator receives the superseding certificate of
representation shall be binding on the new alternate CAIR designated
representative and the owners and operators of the CAIR NOX
source and the CAIR NOX units at the source.
    (c) Changes in owners and operators. (1) In the event an owner or
operator of a CAIR NOX source or a CAIR NOX unit
is not included in the list of owners and operators in the certificate
of representation under Sec.  97.113, such owner or operator shall be
deemed to be subject to and bound by the certificate of representation,
the representations, actions, inactions, and submissions of the CAIR
designated representative and any alternate CAIR designated
representative of the source or unit, and the decisions and orders of
the permitting authority, the Administrator, or a court, as if the
owner or operator were included in such list.
    (2) Within 30 days following any change in the owners and operators
of a CAIR NOX source or a CAIR NOX unit,
including the addition of a new owner or operator, the CAIR designated
representative or any alternate CAIR designated representative shall
submit a revision to the certificate of representation under Sec.
97.113 amending the list of owners and operators to include the change.

Sec.  97.113  Certificate of representation.

    (a) A complete certificate of representation for a CAIR designated
representative or an alternate CAIR designated representative shall
include the following elements in a format prescribed by the
Administrator:
    (1) Identification of the CAIR NOX source, and each CAIR
NOX unit at the source, for which the certificate of
representation is submitted, including identification and nameplate
capacity of each generator served by each such unit.
    (2) The name, address, e-mail address (if any), telephone number,
and facsimile transmission number (if any) of the CAIR designated
representative and any alternate CAIR designated representative.
    (3) A list of the owners and operators of the CAIR NOX
source and of each CAIR NOX unit at the source.
    (4) The following certification statements by the CAIR designated
representative and any alternate CAIR designated representative--
    (i) ``I certify that I was selected as the CAIR designated
representative or alternate CAIR designated representative, as
applicable, by an agreement binding on the owners and operators of the
source and each CAIR NOX unit at the source.''
    (ii) ``I certify that I have all the necessary authority to carry
out my duties and responsibilities under the CAIR NOX Annual
Trading Program on behalf of the owners and operators of the source and
of each CAIR NOX unit at the source and that each such owner
and operator shall be fully bound by my representations, actions,
inactions, or submissions.''
    (iii) ``I certify that the owners and operators of the source and
of each CAIR NOX unit at the source shall be bound by any
order issued to me by the Administrator, the permitting authority, or a
court regarding the source or unit.''
    (iv) (Where there are multiple holders of a legal or equitable
title to, or a leasehold interest in, a CAIR NOX unit, or
where a utility or industrial customer purchases power from a CAIR
NOX unit under a life-of-the-unit, firm power contractual
arrangement, I certify that: I have given a written notice of my
selection as the `CAIR designated representative' or `alternate CAIR
designated representative', as applicable, and of the agreement by
which I was selected to each owner and operator of the source and of
each CAIR NOX unit at the source; and CAIR NOX
allowances and proceeds of transactions involving CAIR NOX
allowances will be deemed to be held or distributed in proportion to
each holder's legal, equitable, leasehold, or contractual reservation
or entitlement, except that, if such multiple holders have expressly
provided for a different distribution of CAIR NOX allowances
by contract, CAIR NOX allowances and proceeds of
transactions involving CAIR NOX allowances will be deemed to
be held or distributed in accordance with the contract.''
    (5) The signature of the CAIR designated representative and any
alternate CAIR designated representative and the dates signed.
    (b) Unless otherwise required by the permitting authority or the
Administrator, documents of agreement referred to in the certificate of

representation shall not be submitted to the permitting authority or
the Administrator. Neither the permitting authority nor the
Administrator shall be under any obligation to review or evaluate the
sufficiency of such documents, if submitted.

Sec.  97.114  Objections concerning CAIR designated representative.

    (a) Once a complete certificate of representation under Sec.
97.113 has been submitted and received, the permitting authority and
the Administrator will rely on the certificate of representation unless
and until a superseding complete certificate of representation under
Sec.  97.113 is received by the Administrator.
    (b) Except as provided in Sec.  97.112(a) or (b), no objection or
other communication submitted to the permitting authority or the
Administrator concerning the authorization, or any representation,
action, inaction, or submission, of the CAIR designated representative
shall affect any representation, action, inaction, or submission of the
CAIR designated representative or the finality of any decision or order
by the permitting authority or the Administrator under the CAIR
NOX Annual Trading Program.
    (c) Neither the permitting authority nor the Administrator will
adjudicate any private legal dispute concerning the authorization or
any representation, action, inaction, or submission of any CAIR
designated representative, including private legal disputes concerning
the proceeds of CAIR NOX allowance transfers.

Sec.  97.115  Delegation by CAIR designated representative and
alternate CAIR designated representative.

    (a) A CAIR designated representative may delegate, to one or more
natural persons, his or her authority to make an electronic submission
to the Administrator provided for or required under this part.
    (b) An alternate CAIR designated representative may delegate, to
one or more natural persons, his or her authority to make an electronic
submission to the Administrator provided for or required under this
part.
    (c) In order to delegate authority to make an electronic submission
to the Administrator in accordance with paragraph (a) or (b) of this
section, the CAIR designated representative or alternate CAIR
designated representative, as appropriate, must submit to the
Administrator a notice of delegation, in a format prescribed by the
Administrator, that includes the following elements:
    (1) The name, address, e-mail address, telephone number, and
facsimile transmission number (if any) of such CAIR designated
representative or alternate CAIR designated representative;
    (2) The name, address, e-mail address, telephone number, and
facsimile transmission number (if any) of each such natural person
(referred to as an ``agent'');
    (3) For each such natural person, a list of the type or types of
electronic submissions under paragraph (a) or (b) of this section for
which authority is delegated to him or her; and
    (4) The following certification statements by such CAIR designated
representative or alternate CAIR designated representative:
    (i) ``I agree that any electronic submission to the Administrator
that is by an agent identified in this notice of delegation and of a
type listed for such agent in this notice of delegation and that is
made when I am a CAIR designated representative or alternate CAIR
designated representative, as appropriate, and before this notice of
delegation is superseded by another notice of delegation under 40 CFR
97.115(d) shall be deemed to be an electronic submission by me.''
    (ii) ``Until this notice of delegation is superseded by another
notice of delegation under 40 CFR 97.115(d), I agree to maintain an e-
mail account and to notify the Administrator immediately of any change
in my e-mail address unless all delegation of authority by me under 40
CFR 97.115 is terminated.''.
    (d) A notice of delegation submitted under paragraph (c) of this
section shall be effective, with regard to the CAIR designated
representative or alternate CAIR designated representative identified
in such notice, upon receipt of such notice by the Administrator and
until receipt by the Administrator of a superseding notice of
delegation submitted by such CAIR designated representative or
alternate CAIR designated representative, as appropriate. The
superseding notice of delegation may replace any previously identified
agent, add a new agent, or eliminate entirely any delegation of
authority.
    (e) Any electronic submission covered by the certification in
paragraph (c)(4)(i) of this section and made in accordance with a
notice of delegation effective under paragraph (d) of this section
shall be deemed to be an electronic submission by the CAIR designated
representative or alternate CAIR designated representative submitting
such notice of delegation.

Subpart CC--Permits

Sec.  97.120  General CAIR NOX Annual Trading Program permit
requirements.

    (a) For each CAIR NOX source required to have a title V
operating permit or required, under subpart II of this part, to have a
title V operating permit or other federally enforceable permit, such
permit shall include a CAIR permit administered by the permitting
authority for the title V operating permit or the federally enforceable
permit as applicable. The CAIR portion of the title V permit or other
federally enforceable permit as applicable shall be administered in
accordance with the permitting authority's title V operating permits
regulations promulgated under part 70 or 71 of this chapter or the
permitting authority's regulations for other federally enforceable
permits as applicable, except as provided otherwise by Sec.  97.105,
this subpart, and subpart II of this part.
    (b) Each CAIR permit shall contain, with regard to the CAIR
NOX source and the CAIR NOX units at the source
covered by the CAIR permit, all applicable CAIR NOX Annual
Trading Program, CAIR NOX Ozone Season Trading Program, and
CAIR SO2 Trading Program requirements and shall be a
complete and separable portion of the title V operating permit or other
federally enforceable permit under paragraph (a) of this section.

Sec.  97.121  Submission of CAIR permit applications.

    (a) Duty to apply. The CAIR designated representative of any CAIR
NOX source required to have a title V operating permit shall
submit to the permitting authority a complete CAIR permit application
under Sec.  97.122 for the source covering each CAIR NOX
unit at the source at least 18 months (or such lesser time provided by
the permitting authority) before the later of January 1, 2009 or the
date on which the CAIR NOX unit commences commercial
operation, except as provided in Sec.  97.183(a).
    (b) Duty to reapply. For a CAIR NOX source required to
have a title V operating permit, the CAIR designated representative
shall submit a complete CAIR permit application under Sec.  97.122 for
the source covering each CAIR NOX unit at the source to
renew the CAIR permit in accordance with the permitting authority's
title V operating permits regulations addressing permit renewal, except
as provided in Sec.  97.183(b).

Sec.  97.122  Information requirements for CAIR permit applications.

    A complete CAIR permit application shall include the following
elements concerning the CAIR NOX source for which the
application is submitted, in a format prescribed by the permitting
authority:
    (a) Identification of the CAIR NOX source;
    (b) Identification of each CAIR NOX unit at the CAIR
NOX source; and
    (c) The standard requirements under Sec.  97.106.

Sec.  97.123  CAIR permit contents and term.

    (a) Each CAIR permit will contain, in a format prescribed by the
permitting authority, all elements required for a complete CAIR permit
application under Sec.  97.122.
    (b) Each CAIR permit is deemed to incorporate automatically the
definitions of terms under Sec.  97.102 and, upon recordation by the
Administrator under subpart EE, FF, GG, or II of this part, every
allocation, transfer, or deduction of a CAIR NOX allowance
to or from the compliance account of the CAIR NOX source
covered by the permit.
    (c) The term of the CAIR permit will be set by the permitting
authority, as necessary to facilitate coordination of the renewal of
the CAIR permit with issuance, revision, or renewal of the CAIR
NOX source's title V operating permit or other federally
enforceable permit as applicable.

Sec.  97.124  CAIR permit revisions.

    Except as provided in Sec.  97.123(b), the permitting authority
will revise the CAIR permit, as necessary, in accordance with the
permitting authority's title V operating permits regulations or the
permitting authority's regulations for other federally enforceable
permits as applicable addressing permit revisions.

Subpart DD--[Reserved]

Subpart EE--CAIR NOX Allowance Allocations

Sec.  97.140  State trading budgets.

    The State trading budgets for annual allocations of CAIR
NOX allowances for the control periods in 2009 through 2014
and in 2015 and thereafter are respectively as follows:

------------------------------------------------------------------------
                                                           State trading
                                           State trading    budget for
                  State                     budget for       2015 and
                                             2009-2014      thereafter
                                              (tons)          (tons)
------------------------------------------------------------------------
Alabama.................................          69,020          57,517
Delaware................................           4,166           3,472
District of Columbia....................             144             120
Florida.................................          99,445          82,871
Georgia.................................          66,321          55,268
Illinois................................          76,230          63,525
Indiana.................................         108,935          90,779
Iowa....................................          32,692          27,243
Kentucky................................          83,205          69,337
Louisiana...............................          35,512          29,593
Maryland................................          27,724          23,104
Michigan................................          65,304          54,420
Minnesota...............................          31,443          26,203
Mississippi.............................          17,807          14,839
Missouri................................          59,871          49,892
New Jersey..............................          12,670          10,558
New York................................          45,617          38,014
North Carolina..........................          62,183          51,819
Ohio....................................         108,667          90,556
Pennsylvania............................          99,049          82,541
South Carolina..........................          32,662          27,219
Tennessee...............................          50,973          42,478
Texas...................................         181,014         150,845
Virginia................................          36,074          30,062
West Virginia...........................          74,220          61,850
Wisconsin...............................          40,759          33,966
                                         -------------------------------
    Total...............................       1,521,707       1,268,091
------------------------------------------------------------------------

Sec.  97.141  Timing requirements for CAIR NOX allowance
allocations.

    (a) The Administrator will determine by order the CAIR
NOX allowance allocations, in accordance with Sec.
97.142(a) and (b), for the control periods in 2009, 2010, 2011, 2012,
2013, and 2014.
    (b) By July 31, 2011 and July 31 of each year thereafter, the
Administrator will determine by order the CAIR NOX allowance
allocations, in accordance with Sec.  97.142(a) and (b), for the
control period in the fourth year after the year of the applicable
deadline for determination under this paragraph.
    (c) By July 31, 2009 and July 31 of each year thereafter, the
Administrator will determine by order the CAIR NOX allowance
allocations, in accordance with Sec.  97.142(a),(c), and (d), for the
control period in the year of the applicable deadline for determination
under this paragraph.
    (d) The Administrator will make available to the public each
determination of CAIR NOX allowances under paragraph (a),
(b), or (c) of this section and will provide an opportunity for
submission of objections to the determination. Objections shall be
limited to addressing whether the determination is in accordance with
Sec.  97.142. Based on any such objections, the Administrator will
adjust each determination to the extent necessary to ensure that it is
in accordance with Sec.  97.142.

Sec.  97.142  CAIR NOX allowance allocations.

    (a)(1) The baseline heat input (in mmBtu) used with respect to CAIR
NOX allowance allocations under paragraph (b) of this
section for each CAIR NOX unit will be:
    (i) For units commencing operation before January 1, 2001 the
average of the 3 highest amounts of the unit's adjusted control period
heat input for 2000 through 2004, with the adjusted control period heat
input for each year calculated as follows:
    (A) If the unit is coal-fired during the year, the unit's control
period heat input for such year is multiplied by 100 percent;
    (B) If the unit is oil-fired during the year, the unit's control
period heat input for such year is multiplied by 60 percent; and
    (C) If the unit is not subject to paragraph (a)(1)(i)(A) or (B) of
this section, the unit's control period heat input for such year is
multiplied by 40 percent.
    (ii) For units commencing operation on or after January 1, 2001 and
operating each calendar year during a period of 5 or more consecutive
calendar years, the average of the 3 highest amounts of the unit's
total converted control period heat input over the first such 5 years.
    (2)(i) A unit's control period heat input, and a unit's status as
coal-fired or oil-fired, for a calendar year under paragraph (a)(1)(i)
of this section, and a unit's total tons of NOX emissions
during a calendar year under paragraph (c)(3) of this section, will be
determined in accordance with part 75 of this chapter, to the extent
the unit was otherwise subject to the requirements of part 75 of this
chapter for the year, or will be based on the best available data
reported to the Administrator for the unit (in a format prescribed by
the Administrator), to the extent the unit was not otherwise subject to
the requirements of part 75 of this chapter for the year.
    (ii) A unit's converted control period heat input for a calendar
year specified under paragraph (a)(1)(ii) of this section equals:
    (A) Except as provided in paragraph (a)(2)(ii)(B) or (C) of this
section, the control period gross electrical output of the generator or
generators served by the unit multiplied by 7,900 Btu/kWh, if the unit
is coal-fired for the year, or 6,675 Btu/kWh, if the unit is not coal-
fired for the year, and divided by 1,000,000 Btu/mmBtu, provided that
if a generator is served by 2 or more units, then the gross electrical
output of the generator will be attributed to each unit in proportion
to the unit's share of the total control period heat input of such
units for the year;
    (B) For a unit that is a boiler and has equipment used to produce
electricity and useful thermal energy for industrial, commercial,
heating, or cooling purposes through the sequential use of energy, the
total heat energy (in Btu) of the steam produced by the boiler during
the control period, divided by 0.8 and by 1,000,000 Btu/mmBtu; or
    (C) For a unit that is a combustion turbine and has equipment used
to produce electricity and useful thermal energy for industrial,
commercial, heating, or cooling purposes through the sequential use of
energy, the control period gross electrical output of the enclosed
device comprising the compressor, combustor, and turbine multiplied by
3,413 Btu/kWh, plus the total heat energy (in Btu) of the steam
produced by any associated heat recovery steam generator during the
control period divided by 0.8, and with the sum divided by 1,000,000
Btu/mmBtu.
    (iii) Gross electrical output and total heat energy under paragraph
(a)(2)(ii) of this section will be determined based on the best
available data reported to the Administrator for the unit (in a format
prescribed by the Administrator).
    (3) The Administrator will determine what data are the best
available data under paragraph (a)(2) of this section by weighing the
likelihood that data are accurate and reliable and giving greater
weight to data submitted to a governmental entity in compliance with
legal requirements or substantiated by an independent entity.
    (b)(1) For each control period in 2009 and thereafter, the
Administrator will allocate to all CAIR NOX units in a State
that have a baseline heat input (as determined under paragraph (a) of
this section) a total amount of CAIR NOX allowances equal to
95 percent for a control period during 2009 through 2014, and 97
percent for a control period during 2015 and thereafter, of the tons of
NOX emissions in the applicable State trading budget under
Sec.  97.140 (except as provided in paragraphs (d) and (e) of this
section).
    (2) The Administrator will allocate CAIR NOX allowances
to each CAIR NOX unit under paragraph (b)(1) of this section
in an amount determined by multiplying the total amount of CAIR
NOX allowances allocated under paragraph (b)(1) of this
section by the ratio of the baseline heat input of such CAIR
NOX unit to the total amount of baseline heat input of all
such CAIR NOX units in the State and rounding to the nearest
whole allowance as appropriate.
    (c) For each control period in 2009 and thereafter, the
Administrator will allocate CAIR NOX allowances to CAIR
NOX units in a State that are not allocated CAIR
NOX allowances under paragraph (b) of this section because
the units do not yet have a baseline heat input under paragraph (a) of
this section or because the units have a baseline heat input but all
CAIR NOX allowances available under paragraph (b) of this
section for the control period are already allocated, in accordance
with the following procedures:
    (1) The Administrator will establish a separate new unit set-aside
for each control period. Each new unit set-aside will be allocated CAIR
NOX allowances equal to 5 percent for a control period in
2009 through 2014, and 3 percent for a control period in 2015 and
thereafter, of the amount of tons of NOX emissions in the
applicable State trading budget under Sec.  97.140.
    (2) The CAIR designated representative of such a CAIR
NOX unit may submit to the Administrator a request, in a
format specified by the Administrator, to be allocated CAIR
NOX allowances, starting with the later of the control
period in 2009 or the first control period after the control period in
which the CAIR NOX unit commences commercial operation and
until the first control period for which the unit is allocated CAIR
NOX allowances under paragraph (b) of this section. A
separate CAIR NOX allowance allocation request for each
control period for which CAIR NOX allowances are sought must
be submitted on or before May 1 of such control period and after the
date on which the CAIR NOX unit commences commercial
operation.
    (3) In a CAIR NOX allowance allocation request under
paragraph (c)(2) of this section, the CAIR designated representative
may request for a control period CAIR NOX allowances in an
amount not exceeding the CAIR NOX unit's total tons of
NOX emissions during the calendar year immediately before
such control period.
    (4) The Administrator will review each CAIR NOX
allowance allocation request under paragraph (c)(2) of this section and
will allocate CAIR NOX allowances for each control period
pursuant to such request as follows:
    (i) The Administrator will accept an allowance allocation request
only if the request meets, or is adjusted by the Administrator as
necessary to meet, the requirements of paragraphs (c)(2) and (3) of
this section.
    (ii) On or after May 1 of the control period, the Administrator
will determine the sum of the CAIR NOX allowances requested
(as adjusted under

paragraph (c)(4)(i) of this section) in all allowance allocation
requests accepted under paragraph (c)(4)(i) of this section for the
control period.
    (iii) If the amount of CAIR NOX allowances in the new
unit set-aside for the control period is greater than or equal to the
sum under paragraph (c)(4)(ii) of this section, then the Administrator
will allocate the amount of CAIR NOX allowances requested
(as adjusted under paragraph (c)(4)(i) of this section) to each CAIR
NOX unit covered by an allowance allocation request accepted
under paragraph (c)(4)(i) of this section.
    (iv) If the amount of CAIR NOX allowances in the new
unit set-aside for the control period is less than the sum under
paragraph (c)(4)(ii) of this section, then the Administrator will
allocate to each CAIR NOX unit covered by an allowance
allocation request accepted under paragraph (c)(4)(i) of this section
the amount of the CAIR NOX allowances requested (as adjusted
under paragraph (c)(4)(i) of this section), multiplied by the amount of
CAIR NOX allowances in the new unit set-aside for the
control period, divided by the sum determined under paragraph
(c)(4)(ii) of this section, and rounded to the nearest whole allowance
as appropriate.
    (v) The Administrator will notify each CAIR designated
representative that submitted an allowance allocation request of the
amount of CAIR NOX allowances (if any) allocated for the
control period to the CAIR NOX unit covered by the request.
    (d) If, after completion of the procedures under paragraph (c)(4)
of this section for a control period, any unallocated CAIR
NOX allowances remain in the new unit set-aside under
paragraph (c) of this section for a State for the control period, the
Administrator will allocate to each CAIR NOX unit that was
allocated CAIR NOX allowances under paragraph (b) of this
section in the State an amount of CAIR NOX allowances equal
to the total amount of such remaining unallocated CAIR NOX
allowances, multiplied by the unit's allocation under paragraph (b) of
this section, divided by 95 percent for a control period during 2009
through 2014, and 97 percent for a control period during 2015 and
thereafter, of the amount of tons of NOX emissions in the
applicable State trading budget under Sec.  97.140, and rounded to the
nearest whole allowance as appropriate.
    (e) If the Administrator determines that CAIR NOX
allowances were allocated under paragraphs (a) and (b) of this section,
paragraphs (a) and (c) of this section, or paragraph (d) of this
section for a control period and that the recipient of the allocation
is not actually a CAIR NOX unit under Sec.  97.104 in such
control period, then the Administrator will notify the CAIR designated
representative and will act in accordance with the following
procedures:
    (1) Except as provided in paragraph (e)(2) or (3) of this section,
the Administrator will not record such CAIR NOX allowances
under Sec.  97.153.
    (2) If the Administrator already recorded such CAIR NOX
allowances under Sec.  97.153 and if the Administrator makes such
determination before making deductions for the source that includes
such recipient under Sec.  97.154(b) for the control period, then the
Administrator will deduct from the account in which such CAIR
NOX allowances were recorded under Sec.  97.153 an amount of
CAIR NOX allowances allocated for the same or a prior
control period equal to the amount of such already recorded CAIR
NOX allowances. The CAIR designated representative shall
ensure that there are sufficient CAIR NOX allowances in such
account for completion of the deduction.
    (3) If the Administrator already recorded such CAIR NOX
allowances under Sec.  97.153 and if the Administrator makes such
determination after making deductions for the source that includes such
recipient under Sec.  97.154(b) for the control period, then the
Administrator will apply paragraph (e)(1) or (2) of this section, as
appropriate, to any subsequent control period for which CAIR
NOX allowances were allocated to such recipient.
    (4) The Administrator will transfer the CAIR NOX
allowances that are not recorded, or that are deducted, in accordance
with paragraphs (e)(1), (2), and (3) of this section to a new unit set-
aside for the State in which such recipient is located.

Sec.  97.143  Compliance supplement pool.

    (a) In addition to the CAIR NOX allowances allocated
under Sec.  97.142, the Administrator may allocate for the control
period in 2009 up to the following amount of CAIR NOX
allowances to CAIR NOX units in the respective State:

------------------------------------------------------------------------
                                                           Compliance
                         State                          supplement  pool
------------------------------------------------------------------------
Alabama...............................................            10,166
Delaware..............................................               843
District of Columbia..................................                 0
Florida...............................................             8,335
Georgia...............................................            12,397
Illinois..............................................            11,299
Indiana...............................................            20,155
Iowa..................................................             6,978
Kentucky..............................................            14,935
Louisiana.............................................             2,251
Maryland..............................................             4,670
Michigan..............................................             8,347
Minnesota.............................................             6,528
Mississippi...........................................             3,066
Missouri..............................................             9,044
New Jersey............................................               660
New York..............................................                 0
North Carolina........................................                 0
Ohio..................................................            25,037
Pennsylvania..........................................            16,009
South Carolina........................................             2,600
Tennessee.............................................             8,944
Texas.................................................               772
Virginia..............................................             5,134
West Virginia.........................................            16,929
Wisconsin.............................................             4,898
                                                       -----------------
    Total.............................................           199,997
------------------------------------------------------------------------

    (b) For any CAIR NOX unit in a State, if the unit's
average annual NOX emission rate for 2007 or 2008 is less
than 0.25 lb/mmBtu and, where such unit is included in a NOX
averaging plan under Sec.  76.11 of this chapter under the Acid Rain
Program for such year, the unit's NOX averaging plan has an
actual weighted average NOX emission rate for such year
equal to or less than the actual weighted average NOX
emission rate for the year before such year and if the unit achieves
NOX emission reductions in 2007 and 2008, the CAIR
designated representative of the unit may request early reduction
credits, and allocation of CAIR NOX allowances from the
compliance supplement pool under paragraph (a) of this section for such
early reduction credits, in accordance with the following:
    (1) The owners and operators of such CAIR NOX unit shall
monitor and report the NOX emissions rate and the heat input
of the unit in accordance with subpart HH of this part in each control
period for which early reduction credit is requested.
    (2) The CAIR designated representative of such CAIR NOX
unit shall submit to the Administrator by May 1, 2009 a request, in a
format specified by the Administrator, for allocation of an amount of
CAIR NOX allowances from the compliance supplement pool not
exceeding the sum of the unit's heat input for the control period in
2007 multiplied by the difference (if any greater than zero) between
0.25 lb/mmBtu and the unit's NOX emission rate for the
control period in 2007 plus the unit's heat input for the control
period in 2008 multiplied by the difference (if any greater than zero)
between 0.25 lb/mmBtu and the unit's

NOX emission rate for the control period in 2008, determined
in accordance with subpart HH of this part and with the sum divided by
2,000 lb/ton and rounded to the nearest whole number of tons as
appropriate.
    (c) For any CAIR NOX unit in a State whose compliance
with CAIR NOX emissions limitation for the control period in
2009 would create an undue risk to the reliability of electricity
supply during such control period, the CAIR designated representative
of the unit may request the allocation of CAIR NOX
allowances from the compliance supplement pool under paragraph (a) of
this section, in accordance with the following:
    (1) The CAIR designated representative of such CAIR NOX
unit shall submit to the Administrator by May 1, 2009 a request, in a
format specified by the Administrator, for allocation of an amount of
CAIR NOX allowances from the compliance supplement pool not
exceeding the minimum amount of CAIR NOX allowances
necessary to remove such undue risk to the reliability of electricity
supply.
    (2) In the request under paragraph (c)(1) of this section, the CAIR
designated representative of such CAIR NOX unit shall
demonstrate that, in the absence of allocation to the unit of the
amount of CAIR NOX allowances requested, the unit's
compliance with CAIR NOX emissions limitation for the
control period in 2009 would create an undue risk to the reliability of
electricity supply during such control period. This demonstration must
include a showing that it would not be feasible for the owners and
operators of the unit to:
    (i) Obtain a sufficient amount of electricity from other
electricity generation facilities, during the installation of control
technology at the unit for compliance with the CAIR NOX
emissions limitation, to prevent such undue risk; or
    (ii) Obtain under paragraphs (b) and (d) of this section, or
otherwise obtain, a sufficient amount of CAIR NOX allowances
to prevent such undue risk.
    (d) The Administrator will review each request under paragraph (b)
or (c) of this section submitted by May 1, 2009 and will allocate CAIR
NOX allowances for the control period in 2009 to CAIR
NOX units in a State and covered by such request as follows:
    (1) Upon receipt of each such request, the Administrator will make
any necessary adjustments to the request to ensure that the amount of
the CAIR NOX allowances requested meets the requirements of
paragraph (b) or (c) of this section.
    (2) If the State's compliance supplement pool under paragraph (a)
of this section has an amount of CAIR NOX allowances not
less than the total amount of CAIR NOX allowances in all
such requests (as adjusted under paragraph (d)(1) of this section), the
Administrator will allocate to each CAIR NOX unit covered by
such requests the amount of CAIR NOX allowances requested
(as adjusted under paragraph (d)(1) of this section).
    (3) If the State's compliance supplement pool under paragraph (a)
of this section has a smaller amount of CAIR NOX allowances
than the total amount of CAIR NOX allowances in all such
requests (as adjusted under paragraph (d)(1) of this section), the
Administrator will allocate CAIR NOX allowances to each CAIR
NOX unit covered by such requests according to the following
formula and rounding to the nearest whole allowance as appropriate:

Unit's allocation = Unit's adjusted allocation x (State's compliance
supplement pool / Total adjusted allocations for all units)

Where:

``Unit's allocation'' is the amount of CAIR NOX
allowances allocated to the unit from the State's compliance
supplement pool.
``Unit's adjusted allocation'' is the amount of CAIR NOX
allowances requested for the unit under paragraph (b) or (c) of this
section, as adjusted under paragraph (d)(1) of this section.
``State's compliance supplement pool'' is the amount of CAIR
NOX allowances in the State's compliance supplement pool.
``Total adjusted allocations for all units'' is the sum of the
amounts of allocations requested for all units under paragraph (b)
or (c) of this section, as adjusted under paragraph (d)(1) of this
section.

    (4) By July 31, 2009, the Administrator will determine by order the
allocations under paragraph (d)(2) or (3) of this section. The
Administrator will make available to the public each determination of
CAIR NOX allowances under such paragraph and will provide an
opportunity for submission of objections to the determination.
Objections shall be limited to addressing whether the determination is
in accordance with paragraph (b) or (c) of this section and paragraph
(d)(2) or (3) of this section, as appropriate. Based on any such
objections, the Administrator will adjust each determination to the
extent necessary to ensure that it is in accordance with such
paragraphs.
    (5) By January 1, 2010, the Administrator will record the
allocations under paragraph (d)(4) of this section.

Sec.  97.144  Alternative of allocation of CAIR NOX
allowances and compliance supplement pool by permitting authority.

    (a) Notwithstanding Sec. Sec.  97.141, 97.142, and 97.153 if a
State submits, and the Administrator approves, a State implementation
plan revision in accordance with Sec.  51.123(p)(1) of this chapter
providing for allocation of CAIR NOX allowances by the
permitting authority, then the permitting authority shall make such
allocations in accordance with such approved State implementation plan
revision, the Administrator will not make allocations under Sec. Sec.
97.141 and 97.142 for the CAIR NOX units in the State, and
under Sec.  97.153, the Administrator will record the allocations made
under such approved State implementation plan revision instead of
allocations made under Sec. Sec.  97.141 and 97.142.
    (b) Notwithstanding Sec.  97.143, if a State submits, and the
Administrator approves, a State implementation plan revision in
accordance with Sec.  51.123(p)(2) of this chapter providing for
allocation of the State's compliance supplement pool by the permitting
authority, then the permitting authority shall make such allocations in
accordance with such approved State implementation plan revision, the
Administrator will not make allocations under Sec.  97.143(d)(4) for
the CAIR NOX units in the State, and under Sec.
97.143(d)(5), the Administrator will record the allocations of the
State's compliance supplement pool made under such approved State
implementation plan revision instead of allocations made under Sec.
97.143(d)(4).
    (c)(1) In implementing paragraph (a) of this section and Sec. Sec.
97.141, 97.142, and 97.153, the Administrator will ensure that the
total amount of CAIR NOX allowances allocated, under such
provisions and under a State's State implementation plan revision
approved in accordance with Sec.  51.123(p)(1) of this chapter, for a
control period for CAIR NOX sources in the State or for
other entities specified by the permitting authority will not exceed
the State's State trading budget for the year of the control period.
    (2) In implementing paragraph (b) of this section and Sec.  97.143,
the Administrator will ensure that the total amount of CAIR
NOX allowances allocated, under such provisions and under a
State's State implementation plan revision approved in accordance with
Sec.  51.123(p)(2), for CAIR NOX sources in the State will
not exceed the State(s compliance supplement pool.

Appendix A to Subpart EE of Part 97--States With Approved State
Implementation Plan Revisions Concerning Allocations

    1. The following States have State Implementation Plan revisions
under Sec.  51.123(p)(1) of this chapter approved by the
Administrator and providing for allocation of CAIR NOX
allowances by the permitting authority under Sec.  97.144(a):
    [Reserved]
    2. The following States have State Implementation Plan revisions
under Sec.  51.123(p)(2) of this chapter approved by the
Administrator and providing for allocation of the Compliance
Supplement Pool by the permitting authority under Sec.  97.144(b):
    [Reserved]

Subpart FF--CAIR NOX Allowance Tracking System

Sec.  97.150  [Reserved]

Sec.  97.151  Establishment of accounts.

    (a) Compliance accounts. Except as provided in Sec.  97.184(e),
upon receipt of a complete certificate of representation under Sec.
97.113, the Administrator will establish a compliance account for the
CAIR NOX source for which the certificate of representation
was submitted, unless the source already has a compliance account.
    (b) General accounts--(1) Application for general account. (i) Any
person may apply to open a general account for the purpose of holding
and transferring CAIR NOX allowances. An application for a
general account may designate one and only one CAIR authorized account
representative and one and only one alternate CAIR authorized account
representative who may act on behalf of the CAIR authorized account
representative. The agreement by which the alternate CAIR authorized
account representative is selected shall include a procedure for
authorizing the alternate CAIR authorized account representative to act
in lieu of the CAIR authorized account representative.
    (ii) A complete application for a general account shall be
submitted to the Administrator and shall include the following elements
in a format prescribed by the Administrator:
    (A) Name, mailing address, e-mail address (if any), telephone
number, and facsimile transmission number (if any) of the CAIR
authorized account representative and any alternate CAIR authorized
account representative;
    (B) Organization name and type of organization, if applicable;
    (C) A list of all persons subject to a binding agreement for the
CAIR authorized account representative and any alternate CAIR
authorized account representative to represent their ownership interest
with respect to the CAIR NOX allowances held in the general
account;
    (D) The following certification statement by the CAIR authorized
account representative and any alternate CAIR authorized account
representative: ``I certify that I was selected as the CAIR authorized
account representative or the alternate CAIR authorized account
representative, as applicable, by an agreement that is binding on all
persons who have an ownership interest with respect to CAIR
NOX allowances held in the general account. I certify that I
have all the necessary authority to carry out my duties and
responsibilities under the CAIR NOX Annual Trading Program
on behalf of such persons and that each such person shall be fully
bound by my representations, actions, inactions, or submissions and by
any order or decision issued to me by the Administrator or a court
regarding the general account.''
    (E) The signature of the CAIR authorized account representative and
any alternate CAIR authorized account representative and the dates
signed.
    (iii) Unless otherwise required by the permitting authority or the
Administrator, documents of agreement referred to in the application
for a general account shall not be submitted to the permitting
authority or the Administrator. Neither the permitting authority nor
the Administrator shall be under any obligation to review or evaluate
the sufficiency of such documents, if submitted.
    (2) Authorization of CAIR authorized account representative and
alternate CAIR authorized account representative. (i) Upon receipt by
the Administrator of a complete application for a general account under
paragraph (b)(1) of this section:
    (A) The Administrator will establish a general account for the
person or persons for whom the application is submitted.
    (B) The CAIR authorized account representative and any alternate
CAIR authorized account representative for the general account shall
represent and, by his or her representations, actions, inactions, or
submissions, legally bind each person who has an ownership interest
with respect to CAIR NOX allowances held in the general
account in all matters pertaining to the CAIR NOX Annual
Trading Program, notwithstanding any agreement between the CAIR
authorized account representative or any alternate CAIR authorized
account representative and such person. Any such person shall be bound
by any order or decision issued to the CAIR authorized account
representative or any alternate CAIR authorized account representative
by the Administrator or a court regarding the general account.
    (C) Any representation, action, inaction, or submission by any
alternate CAIR authorized account representative shall be deemed to be
a representation, action, inaction, or submission by the CAIR
authorized account representative.
    (ii) Each submission concerning the general account shall be
submitted, signed, and certified by the CAIR authorized account
representative or any alternate CAIR authorized account representative
for the persons having an ownership interest with respect to CAIR
NOX allowances held in the general account. Each such
submission shall include the following certification statement by the
CAIR authorized account representative or any alternate CAIR authorized
account representative: ``I am authorized to make this submission on
behalf of the persons having an ownership interest with respect to the
CAIR NOX allowances held in the general account. 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.''
    (iii) The Administrator will accept or act on a submission
concerning the general account only if the submission has been made,
signed, and certified in accordance with paragraph (b)(2)(ii) of this
section.
    (3) Changing CAIR authorized account representative and alternate
CAIR authorized account representative; changes in persons with
ownership interest. (i) The CAIR authorized account representative for
a general account may be changed at any time upon receipt by the
Administrator of a superseding complete application for a general
account under paragraph (b)(1) of this section. Notwithstanding any
such change, all representations, actions, inactions, and submissions
by the previous CAIR authorized account representative before the time
and date when the Administrator receives the superseding application
for a general account shall be binding on the new CAIR authorized
account representative

and the persons with an ownership interest with respect to the CAIR
NOX allowances in the general account.
    (ii) The alternate CAIR authorized account representative for a
general account may be changed at any time upon receipt by the
Administrator of a superseding complete application for a general
account under paragraph (b)(1) of this section. Notwithstanding any
such change, all representations, actions, inactions, and submissions
by the previous alternate CAIR authorized account representative before
the time and date when the Administrator receives the superseding
application for a general account shall be binding on the new alternate
CAIR authorized account representative and the persons with an
ownership interest with respect to the CAIR NOX allowances
in the general account.
    (iii)(A) In the event a person having an ownership interest with
respect to CAIR NOX allowances in the general account is not
included in the list of such persons in the application for a general
account, such person shall be deemed to be subject to and bound by the
application for a general account, the representation, actions,
inactions, and submissions of the CAIR authorized account
representative and any alternate CAIR authorized account representative
of the account, and the decisions and orders of the Administrator or a
court, as if the person were included in such list.
    (B) Within 30 days following any change in the persons having an
ownership interest with respect to CAIR NOX allowances in
the general account, including the addition of a new person, the CAIR
authorized account representative or any alternate CAIR authorized
account representative shall submit a revision to the application for a
general account amending the list of persons having an ownership
interest with respect to the CAIR NOX allowances in the
general account to include the change.
    (4) Objections concerning CAIR authorized account representative
and alternate CAIR authorized account representative. (i) Once a
complete application for a general account under paragraph (b)(1) of
this section has been submitted and received, the Administrator will
rely on the application unless and until a superseding complete
application for a general account under paragraph (b)(1) of this
section is received by the Administrator.
    (ii) Except as provided in paragraph (b)(3)(i) or (ii) of this
section, no objection or other communication submitted to the
Administrator concerning the authorization, or any representation,
action, inaction, or submission of the CAIR authorized account
representative or any alternate CAIR authorized account representative
for a general account shall affect any representation, action,
inaction, or submission of the CAIR authorized account representative
or any alternate CAIR authorized account representative or the finality
of any decision or order by the Administrator under the CAIR
NOX Annual Trading Program.
    (iii) The Administrator will not adjudicate any private legal
dispute concerning the authorization or any representation, action,
inaction, or submission of the CAIR authorized account representative
or any alternate CAIR authorized account representative for a general
account, including private legal disputes concerning the proceeds of
CAIR NOX allowance transfers.
    (5) Delegation by CAIR authorized account representative and
alternate CAIR authorized account representative. (i) A CAIR authorized
account representative may delegate, to one or more natural persons,
his or her authority to make an electronic submission to the
Administrator provided for or required under subparts FF and GG of this
part.
    (ii) An alternate CAIR authorized account representative may
delegate, to one or more natural persons, his or her authority to make
an electronic submission to the Administrator provided for or required
under subparts FF and GG of this part.
    (iii) In order to delegate authority to make an electronic
submission to the Administrator in accordance with paragraph (b)(5)(i)
or (ii) of this section, the CAIR authorized account representative or
alternate CAIR authorized account representative, as appropriate, must
submit to the Administrator a notice of delegation, in a format
prescribed by the Administrator, that includes the following elements:
    (A) The name, address, e-mail address, telephone number, and
facsimile transmission number (if any) of such CAIR authorized account
representative or alternate CAIR authorized account representative;
    (B) The name, address, e-mail address, telephone number, and
facsimile transmission number (if any) of each such natural person
(referred to as an ``agent'');
    (C) For each such natural person, a list of the type or types of
electronic submissions under paragraph (b)(5)(i) or (ii) of this
section for which authority is delegated to him or her;
    (D) The following certification statement by such CAIR authorized
account representative or alternate CAIR authorized account
representative: ``I agree that any electronic submission to the
Administrator that is by an agent identified in this notice of
delegation and of a type listed for such agent in this notice of
delegation and that is made when I am a CAIR authorized account
representative or alternate CAIR authorized representative, as
appropriate, and before this notice of delegation is superseded by
another notice of delegation under 40 CFR 97.151(b)(5)(iv) shall be
deemed to be an electronic submission by me.''; and
    (E) The following certification statement by such CAIR authorized
account representative or alternate CAIR authorized account
representative: ``Until this notice of delegation is superseded by
another notice of delegation under 40 CFR 97.151(b)(5)(iv), I agree to
maintain an e-mail account and to notify the Administrator immediately
of any change in my e-mail address unless all delegation of authority
by me under 40 CFR 97.151(b)(5) is terminated.''.
    (iv) A notice of delegation submitted under paragraph (b)(5)(iii)
of this section shall be effective, with regard to the CAIR authorized
account representative or alternate CAIR authorized account
representative identified in such notice, upon receipt of such notice
by the Administrator and until receipt by the Administrator of a
superseding notice of delegation submitted by such CAIR authorized
account representative or alternate CAIR authorized account
representative, as appropriate. The superseding notice of delegation
may replace any previously identified agent, add a new agent, or
eliminate entirely any delegation of authority.
    (v) Any electronic submission covered by the certification in
paragraph (b)(5)(iii)(D) of this section and made in accordance with a
notice of delegation effective under paragraph (b)(5)(iv) of this
section shall be deemed to be an electronic submission by the CAIR
designated representative or alternate CAIR designated representative
submitting such notice of delegation.
    (c) Account identification. The Administrator will assign a unique
identifying number to each account established under paragraph (a) or
(b) of this section.

Sec.  97.152  Responsibilities of CAIR authorized account
representative.

    Following the establishment of a CAIR NOX Allowance
Tracking System account, all submissions to the

Administrator pertaining to the account, including, but not limited to,
submissions concerning the deduction or transfer of CAIR NOX
allowances in the account, shall be made only by the CAIR authorized
account representative for the account.

Sec.  97.153  Recordation of CAIR NOX allowance allocations.

    (a) By September 30, 2007, the Administrator will record in the
CAIR NOX source's compliance account the CAIR NOX
allowances allocated for the CAIR NOX units at the source in
accordance with Sec.  97.142(a) and (b) for the control period in 2009.
    (b) By September 30, 2008, the Administrator will record in the
CAIR NOX source's compliance account the CAIR NOX
allowances allocated for the CAIR NOX units at the source in
accordance with Sec.  97.142(a) and (b) for the control period in 2010.
    (c) By September 30, 2009, the Administrator will record in the
CAIR NOX source's compliance account the CAIR NOX
allowances allocated for the CAIR NOX units at the source in
accordance with Sec.  97.142(a) and (b) for the control periods in
2011, 2012, and 2013.
    (d) By December 1, 2010 and December 1 of each year thereafter, the
Administrator will record in the CAIR NOX source's
compliance account the CAIR NOX allowances allocated for the
CAIR NOX units at the source in accordance with Sec.
97.142(a) and (b) for the control period in the fourth year after the
year of the applicable deadline for recordation under this paragraph.
    (e) By December 1, 2009 and December 1 of each year thereafter, the
Administrator will record in the CAIR NOX source's
compliance account the CAIR NOX allowances allocated for the
CAIR NOX units at the source in accordance with Sec.
97.142(a) and (c) for the control period in the year of the applicable
deadline for recordation under this paragraph.
    (f) Serial numbers for allocated CAIR NOX allowances. When
recording the allocation of CAIR NOX allowances for a CAIR
NOX unit in a compliance account, the Administrator will
assign each CAIR NOX allowance a unique identification
number that will include digits identifying the year of the control
period for which the CAIR NOX allowance is allocated.

Sec.  97.154  Compliance with CAIR NOX emissions limitation.

    (a) Allowance transfer deadline. The CAIR NOX allowances
are available to be deducted for compliance with a source's CAIR
NOX emissions limitation for a control period in a given
calendar year only if the CAIR NOX allowances:
    (1) Were allocated for the control period in the year or a prior
year; and
    (2) Are held in the compliance account as of the allowance transfer
deadline for the control period or are transferred into the compliance
account by a CAIR NOX allowance transfer correctly submitted
for recordation under Sec. Sec.  97.160 and 97.161 by the allowance
transfer deadline for the control period.
    (b) Deductions for compliance. Following the recordation, in
accordance with Sec.  97.161, of CAIR NOX allowance
transfers submitted for recordation in a source's compliance account by
the allowance transfer deadline for a control period, the Administrator
will deduct from the compliance account CAIR NOX allowances
available under paragraph (a) of this section in order to determine
whether the source meets the CAIR NOX emissions limitation
for the control period, as follows:
    (1) Until the amount of CAIR NOX allowances deducted
equals the number of tons of total nitrogen oxides emissions,
determined in accordance with subpart HH of this part, from all CAIR
NOX units at the source for the control period; or
    (2) If there are insufficient CAIR NOX allowances to
complete the deductions in paragraph (b)(1) of this section, until no
more CAIR NOX allowances available under paragraph (a) of
this section remain in the compliance account.
    (c)(1) Identification of CAIR NOX allowances by serial number. The
CAIR authorized account representative for a source's compliance
account may request that specific CAIR NOX allowances,
identified by serial number, in the compliance account be deducted for
emissions or excess emissions for a control period in accordance with
paragraph (b) or (d) of this section. Such request shall be submitted
to the Administrator by the allowance transfer deadline for the control
period and include, in a format prescribed by the Administrator, the
identification of the CAIR NOX source and the appropriate
serial numbers.
    (2) First-in, first-out. The Administrator will deduct CAIR
NOX allowances under paragraph (b) or (d) of this section
from the source's compliance account, in the absence of an
identification or in the case of a partial identification of CAIR
NOX allowances by serial number under paragraph (c)(1) of
this section, on a first-in, first-out (FIFO) accounting basis in the
following order:
    (i) Any CAIR NOX allowances that were allocated to the
units at the source, in the order of recordation; and then
    (ii) Any CAIR NOX allowances that were allocated to any
entity and transferred and recorded in the compliance account pursuant
to subpart GG of this part, in the order of recordation.
    (d) Deductions for excess emissions. (1) After making the
deductions for compliance under paragraph (b) of this section for a
control period in a calendar year in which the CAIR NOX
source has excess emissions, the Administrator will deduct from the
source's compliance account an amount of CAIR NOX
allowances, allocated for the control period in the immediately
following calendar year, equal to 3 times the number of tons of the
source's excess emissions.