2023-18214. Availability of Data on Allocations of Cross-State Air Pollution Rule Allowances to Existing Electricity Generating Units

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Notice of data availability.

SUMMARY:

Under the Cross-State Air Pollution Rule (CSAPR) trading program regulations, EPA allocates emission allowances to existing electricity generating units (EGUs) as provided in notices of data availability (NODAs). Through this NODA, EPA is providing notice of the availability of data on new or revised default allocations of CSAPR NO_X Ozone Season Group 3 allowances to existing units for the 2023–2025 control periods, as well as the data upon which the allocations are based.

DATES:

August 24, 2023.

FOR FURTHER INFORMATION CONTACT:

Garrett Powers, Clean Air Markets Division, Office of Atmospheric Protection, Office of Air and Radiation, U.S. Environmental Protection Agency, Mail Code 6204A, 1200 Pennsylvania Avenue NW, Washington, DC 20460; telephone: [phone]; email: [e-mail].

SUPPLEMENTARY INFORMATION:

In the Good Neighbor Plan,^[1] EPA expanded the CSAPR NO_X Ozone Season Group 3 Trading Program ^[2] to include EGUs in 10 additional states and updated the program's provisions to achieve further emissions reductions.^[3] The rule's required emissions control stringencies are reflected in new or revised state emissions budgets which in turn necessitate new or revised unit-level allowance allocations. Beginning with the 2024 control period, each covered state has the option to determine how the CSAPR NO_X Ozone Season Group 3 allowances in its state emissions budget should be allocated among the state's units through a state implementation plan (SIP) revision.^[4] However, for the 2023 control period, and by default for subsequent control periods for which a state has not provided EPA with the state's own allocations pursuant to an approved SIP revision, the unit-level allocations are determined by EPA.

Under EPA's default unit-level allocation methodology for the Good Neighbor Plan, most EGUs within a covered state's borders are treated as “existing” units and receive allocations of allowances for a given control period in advance of the control period.^[5] If any of the existing units are located in areas of Indian country within the state's borders that are not subject to the state's SIP authority, the default allocations to those existing units are made through an “Indian country existing unit set-aside” in parallel with the default allocations to the other existing units.^[6] The EGUs that EPA identified in the rulemaking as eligible to receive default allocations as existing units for the 2023–2025 control periods in the states covered by this NODA are listed in the spreadsheet referenced later in this notice. EGUs located anywhere within a state's borders that do not receive allocations of CSAPR NO_X Ozone Season Group 3 allowances as “existing” units and that report emissions subject to allowance holding requirements for a given control period are eligible to receive allowance allocations as “new” units from the state's new unit set-aside for that control period.^[7]

EPA determined new and revised state emissions budgets for the 2023–2025 control periods on a full-season basis in the Good Neighbor Plan rulemaking. However, because the Agency anticipated that the rule's effective date could fall after the start of the 2023 ozone season, the final regulations include a procedure for prorating the 2023 state emissions budgets to ensure that the enhanced control stringency reflected in the Good Neighbor Plan's full-season 2023 state emissions budgets will apply only after the rule's effective date.^[8] The Good Neighbor Plan provided that the 2023 unit-level allocations would be computed by applying the rule's unit-level allocation methodology to the 2023 state emissions budgets determined through the prorating procedure.^[9]

Through this NODA, EPA is providing notice of the availability of data concerning the default unit-level allocations of CSAPR NO_X Ozone Season Group 3 allowances to existing units for the 2023, 2024, and 2025 control periods. The allocations are shown in an Excel spreadsheet entitled “Unit-level Allocations and Underlying Data for the Final Rule” posted on EPA's website at www.epa.gov/​csapr/​good-neighbor-plan-2015-ozone-naaqs. The spreadsheet also contains the data upon which the allocations are based, including the 2023 state emissions budgets that EPA has computed according to the prorating procedure in the regulations. The spreadsheet is an update of an earlier version included in the docket for the final Good Neighbor Plan which showed the allocations for the 2024 and 2025 control periods as well as illustrative allocations for the 2023 control period. All allocations have been determined according to the allocation methodology finalized in the Good Neighbor Plan rulemaking.^[10] EPA is not requesting comment on the allocations, the underlying data, or the allocation methodology.

In accordance with the deadlines set forth in the regulations, EPA will record allocations of CSAPR NO_X Ozone Season Group 3 allowances to existing units for the 2023 control period by September 5, 2023.^[11] EPA will also record allocations to existing units for the 2024 control period by that same date except in instances where a state has provided EPA with timely notice of the state's intent to submit a SIP revision with state-determined allowance allocations replacing EPA's default allocations for the 2024 control period.^[12] However, in the case of any source that has not yet fully complied with the Good Neighbor Plan's requirements concerning the recall of CSAPR NO_X Ozone Season Group 2 allowances allocated for control periods after 2022, recordation of CSAPR NO_X Ozone Season Group 3 allowances will be deferred until the source has fully complied with the recall requirements.^[13] EPA will record allocations of CSAPR NO_X Ozone Season Group 3 allowances to existing units for the 2025 control period by July 1, 2024.^[14]

EPA notes that an allocation or lack of allocation of emission allowances to a given unit under a CSAPR trading program does not constitute a determination that the trading program does or does not apply to the unit.^[15] EPA also notes that allocations are subject to potential correction or termination under the regulations.^[16]

Authority:40 CFR 97.1011(a)(1) and (2).

Rona Birnbaum,

Director, Clean Air Markets Division, Office of Atmospheric Protection, Office of Air and Radiation.

Footnotes

1.  Federal “Good Neighbor Plan” for the 2015 Ozone National Ambient Air Quality Standards, 88 FR 36654 (June 5, 2023).

2.  The CSAPR NO_X Ozone Season Group 3 Trading Program was originally established in the Revised CSAPR Update (86 FR 23054, April 30, 2021) as a mechanism for EGUs in 12 states to reduce ozone season emissions of nitrogen oxides (NO_X) starting in 2021.

3.  Some courts have issued preliminary orders partially staying the effectiveness of a separate EPA action (88 FR 9336, February 13, 2023) which disapproves state implementation plans addressing good neighbor obligations for several states, and EPA is taking measures to comply with those orders. The description of the Good Neighbor Plan in this NODA reflects the rule as published, without regard to the stay orders and the measures EPA is taking to comply with them. However, EPA will not record allocations of CSAPR NO_X Ozone Season Group 3 allowances to any EGUs that are not currently participating in the CSAPR NO_X Ozone Season Group 3 Trading Program because of the measures EPA is taking to comply with the stay orders. Consequently, the spreadsheet referenced in this NODA has been edited to remove information on unit-level allocations of CSAPR NO_X Ozone Season Group 3 allowances to units in any state covered by a stay order when the NODA was signed.

4.   See40 CFR 52.38(b)(10) through (12).

5.   See40 CFR 97.1011.

6.   See40 CFR 97.1010(b).

7.   See40 CFR 97.1010(c) and 97.1012. Allocations from a state's new unit set-aside for a given control period are made after the respective control period and are not addressed in this notice.

8.   See40 CFR 97.1010(a)(1)(ii).

9.   See88 FR 36811–13.

10.   See Allowance Allocation under the Final Rule TSD, EPA–HQ–OAR–2021–0668–1079, available at www.regulations.gov and www.epa.gov/​csapr/​good-neighbor-plan-2015-ozone-naaqs; see also88 FR 36805–07.

11.   See40 CFR 97.1021(d) and (g).

12.   See40 CFR 97.1021(e).

13.   See40 CFR 97.1021(m); see also40 CFR 97.811(e).

14.   See40 CFR 97.1021(f) and (h).

15.   See40 CFR 97.1011(a)(3).

16.   See40 CFR 97.1011(c).