10.1-1328 - Emissions rates and limitations.
§ 10.1-1328. Emissions rates and limitations.
A. To ensure that the Commonwealth meets the emissions budgets established bythe federal Environmental Protection Agency (EPA) in its CAIR, the Boardshall promulgate regulations that provide:
1. Beginning on January 1, 2009, and each year continuing through January 1,2014, all electric generating units within the Commonwealth shallcollectively be allocated allowances of 36,074 tons of nitrogen oxide (NOx)annually, and 15,994 tons of NOx during an ozone season;
2. Beginning on January 1, 2010, and each year continuing through January 1,2014, all electric generating units within the Commonwealth shallcollectively be allocated allowances of 63,478 tons of sulfur dioxide (SO2)annually, unless a different allocation is established by the Administratorof the EPA;
3. Beginning on January 1, 2015, all electric generating units within theCommonwealth shall collectively be allocated allowances of 44,435 tons of SO2annually, 30,062 tons of NOx annually, and 13,328 tons of NOx during an ozoneseason, unless a different allocation is established for SO2 by theAdministrator of the EPA;
4. The rules shall include a 5% set-aside of NOx allowances during the firstfive years of the program and 2% thereafter for new sources, includingrenewables and energy efficiency projects; and
5. The regulation shall provide for participation in the EPA-administered capand trade system for NOx and SO2 to the fullest extent permitted by federallaw.
B. To further protect Virginia's environment regarding control of NOxemissions from electric generating units, the owner of one or more electricgenerating units that are located within the Commonwealth and whose combinedemissions of NOx from such units exceeded 40,000 tons in 2004 shall achievean amount of early reductions in NOx emissions during the 2007 or 2008 annualcontrol periods equal to the total number of allowances in the Virginiacompliance supplement pool established by the EPA in the CAIR. The reductionsachieved under this provision will be fully eligible for early reductioncredits and allowance allocations provided from the compliance supplementpool under the early reduction credit provisions of the CAIR rule. Theregulations shall include provisions for the distribution of the allowancesfrom the Virginia compliance supplement pool established by the EPA for earlyreduction credits, and the state shall award the owner of electric generatingunits subject to this subsection NOx allowances in accordance therewith. Therequirement to achieve early reductions of NOx under this subsection shallnot restrict the ability to bank or sell the allowances provided to the ownerunder the early reduction credit provisions of the CAIR rule submitted to theEPA in the federal CAIR annual NOx trading program or restrict the ability ofthe use of such allowances to demonstrate compliance with the CAIR.
C. To ensure compliance with the EPA requirements regarding control ofmercury emissions from electric generating units, the Board shall adopt andsubmit to the EPA the model Clean Air Mercury Rule (CAMR) promulgated by theEPA, including full participation by Virginia electric generating units inthe EPA's national mercury trading program. This model rule shall include aset-aside of mercury allowances for new sources not to exceed 5% of the totalstate budget for each control period during the first five years of theprogram and 2% thereafter.
D. To further protect Virginia's environment regarding control of mercuryemissions from electric generating units, the Board shall adopt a separatestate-specific rule that shall not be submitted to the EPA. Thisstate-specific rule shall apply to the owner of one or more electricgenerating units that are located within the Commonwealth and whose combinedemissions of mercury from such units exceeded 200 pounds in 1999. Thisstate-specific rule shall differ from the model CAMR only in the followingrespects:
1. For the owner of one or more electric generating units that are locatedwithin the Commonwealth and whose combined emissions of mercury from suchunits exceeded 900 pounds in 1999, the state-specific rule shall allocate aseparate set of state-only mercury allowances equal to the CAMR allocation,and such owner shall be permitted to demonstrate compliance with thestate-specific rule by showing that total mercury emissions from all of itselectric generating units located within the Commonwealth do not exceed thetotal mercury allowances allocated to those units in the aggregate, and thecompliance date for Phase 2 emission limits shall be January 1, 2015.
2. The owner of one or more electric generating units that are located withinthe Commonwealth and whose combined emissions of mercury from those units in1999 were less than 900 pounds and whose combined capacity within theCommonwealth is greater than or equal to 600 MW, shall be permitted tosatisfy its compliance obligations under the state-specific rule through thesurrender of CAMR allowances that meet the following requirements: theallowances to be used are allocated to a facility under the control of thesame owner or operator or under common control by the same parentcorporation; the allowances used are generated and capable of being lawfullytraded under the CAMR; and the surplus allowances are generated through theinstallation of emission controls at a facility located a straight linedistance from the border of the Commonwealth of less than or equal to 200 km.
3. The owners subject to the state-specific rule shall not be permitted topurchase allowances to demonstrate compliance with the regulations the Boardadopts to implement this subsection. This prohibition does not include thetransfer of credits authorized by subdivision 2.
4. Nothing in the state-specific mercury rule shall be construed to prohibitthe banking, use, or selling of allowances under the CAMR, and compliancewith the CAMR and the state-specific mercury rule shall be determinedseparately and in accordance with the terms of each rule.
E. The Board shall adopt regulations governing mercury emissions that meet,but do not exceed, the requirements and implementation timetables for (i) anycoke oven batteries for which the EPA has promulgated standards under §112(d) of the Clean Air Act, and (ii) facilities subject to review under §112(k) of the Clean Air Act and that receive scrap metal from persons subjectto § 46.2-635 of the Code of Virginia.
F. To further protect Virginia's environment, the Board shall prohibit anyelectric generating facility located within a nonattainment area from meetingits mercury compliance obligations through the purchase of allowances fromanother facility, except that such facilities shall be able to demonstratecompliance with allowances allocated to another facility that is under thecontrol of the same owner or operator or under common control by the sameparent corporation and is located within 200 km of Virginia's border.
(2006, cc. 867, 920; 2010, cc. 783, 867.)