The Environmental Protection Agency (EPA) on Thursday proposed “technical adjustments” to the Cross-State Air Pollution Rule (CSAPR) finalized on July 6 that would increase statewide limitations on emissions of sulfur dioxide (SO2) and nitrogen oxide (NOx) for nine states. This proposal also amends the assurance penalty provisions for all states within the program so that they start in 2014, instead of 2012, to promote the development of allowance market liquidity and smooth the transition from the Clean Air Interstate Rule (CAIR) program.

The changes were prompted by input from power plant owners, and the proposal revises some discrepancies affecting state budgets in Florida, Louisiana, Michigan, Mississippi, Nebraska, New Jersey, New York, Texas, and Wisconsin and new unit set-asides in Arkansas and Texas. The proposal also revises unit-level allocations in Alabama, Indiana, Kansas, Kentucky, Ohio, and Tennessee to better account for utility consent decrees.

Although the proposed changes would increase most of these states’ emission budgets by relatively minor proportions (1.3% to 3.8%), Texas would see its SO2 budget expand by 29% under the proposed rule.

Under the proposed rule, Florida, Louisiana, and Mississippi would see an increase in their 2012 ozone-season NOx budgets with corresponding revisions to assurance levels and new unit set-asides. It would also increase the annual NOx budget for Michigan, Nebraska, New Jersey, and New York. Texas, New Jersey, New York, and Wisconsin would also see increases in their SO2 budgets.

The CSAPR replaces CAIR starting January 1, 2012. Sources covered by the CSAPR annual SO2 and NOx programs must comply—that is, surrender allowances to cover their 2012 annual emissions—in March 2013. Sources covered by the NOx ozone season program must comply on November 30, 2012 by surrendering allowances sufficient to cover their ozone season NOx emissions.

The EPA issued CAIR on May 12, 2005 and the CAIR federal implementation plans on April 26, 2006. But in 2008, the U.S. Court of Appeals for the D.C. Circuit remanded CAIR to the agency, leaving existing CAIR programs in place while directing the EPA to replace them as rapidly as possible with a new rule consistent with the Clean Air Act.

The EPA will accept comment on the proposal for 30 days after the rule’s publication in the Federal Register. Comments can be submitted through

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www.regulations.gov or by e-mail at a-and-r-Docket@epa.gov.

Sources: POWERnews, EPA