A CAIR SO2 opt-in unit must be a unit that:

(a) Is located in a State that submits, and for which the Administrator approves, a State implementation plan revision in accordance with § 51.124(r)(1), (2), or (3) of this chapter establishing procedures concerning CAIR opt-in units;

(b) Is not a CAIR SO2 unit under § 97.204 and is not covered by a retired unit exemption under § 97.205 that is in effect;

(c) Is not covered by a retired unit exemption under § 72.8 of this chapter that is in effect and is not an opt-in source under part 74 of this chapter;

(d) Has or is required or qualified to have a title V operating permit or other federally enforceable permit; and

(e) Vents all of its emissions to a stack and can meet the monitoring, recordkeeping, and reporting requirements of subpart HH of this part.

(a) Except as otherwise provided in §§ 97.201 through 97.204, §§ 97.206 through 97.208, and subparts BBB and CCC and subparts FFF through HHH of this part, a CAIR SO2 opt-in unit shall be treated as a CAIR SO2 unit for purposes of applying such sections and subparts of this part.

(b) Solely for purposes of applying, as provided in this subpart, the requirements of subpart HHH of this part to a unit for which a CAIR opt-in permit application is submitted and not withdrawn and a CAIR opt-in permit is not yet issued or denied under this subpart, such unit shall be treated as a CAIR SO2 unit before issuance of a CAIR opt-in permit for such unit.

Any CAIR SO2 opt-in unit, and any unit for which a CAIR opt-in permit application is submitted and not withdrawn and a CAIR opt-in permit is not yet issued or denied under this subpart, located at the same source as one or more CAIR SO2 units shall have the same CAIR designated representative and alternate CAIR designated representative as such CAIR SO2 units.

(a) Applying for initial CAIR opt-in permit. The CAIR designated representative of a unit meeting the requirements for a CAIR SO2 opt-in unit in § 97.280 may apply for an initial CAIR opt-in permit at any time, except as provided under § 97.286(f) and (g), and, in order to apply, must submit the following:

(1) A complete CAIR permit application under § 97.222;

(2) A certification, in a format specified by the permitting authority, that the unit:

(i) Is not a CAIR SO2 unit under § 97.204 and is not covered by a retired unit exemption under § 97.205 that is in effect;

(ii) Is not covered by a retired unit exemption under § 72.8 of this chapter that is in effect;

(iii) Is not and, so long as the unit is a CAIR SO2 opt-in unit, will not become, an opt-in source under part 74 of this chapter;

(iv) Vents all of its emissions to a stack; and

(v) Has documented heat input for more than 876 hours during the 6 months immediately preceding submission of the CAIR permit application under § 97.222;

(3) A monitoring plan in accordance with subpart HHH of this part;

(4) A complete certificate of representation under § 97.213 consistent with § 97.282, if no CAIR designated representative has been previously designated for the source that includes the unit; and

(5) A statement, in a format specified by the permitting authority, whether the CAIR designated representative requests that the unit be allocated CAIR SO2 allowances under § 97.288(b) or § 97.288(c) (subject to the conditions in §§ 97.284(h) and 97.286(g)), to the extent such allocation is provided in a State implementation plan revision submitted in accordance with § 51.124(r)(1), (2), or (3) of this chapter and approved by the Administrator. If allocation under § 97.288(c) is requested, this statement shall include a statement that the owners and operators of the unit intend to repower the unit before January 1, 2015 and that they will provide, upon request, documentation demonstrating such intent.

(b) Duty to reapply. (1) The CAIR designated representative of a CAIR SO2 opt-in unit shall submit a complete CAIR permit application under § 97.222 to renew the CAIR opt-in unit permit in accordance with the permitting authority's regulations for title V operating permits, or the permitting authority's regulations for other federally enforceable permits if applicable, addressing permit renewal.

(2) Unless the permitting authority issues a notification of acceptance of withdrawal of the CAIR SO2 opt-in unit from the CAIR SO2 Trading Program in accordance with § 97.286 or the unit becomes a CAIR SO2 unit under § 97.204, the CAIR SO2 opt-in unit shall remain subject to the requirements for a CAIR SO2 opt-in unit, even if the CAIR designated representative for the CAIR SO2 opt-in unit fails to submit a CAIR permit application that is required for renewal of the CAIR opt-in permit under paragraph (b)(1) of this section.

The permitting authority will issue or deny a CAIR opt-in permit for a unit for which an initial application for a CAIR opt-in permit under § 97.183 is submitted in accordance with the following, to the extent provided in a State implementation plan revision submitted in accordance with § 51.124(r)(1), (2), or (3) of this chapter and approved by the Administrator:

(a) Interim review of monitoring plan. The permitting authority and the Administrator will determine, on an interim basis, the sufficiency of the monitoring plan accompanying the initial application for a CAIR opt-in permit under § 97.283. A monitoring plan is sufficient, for purposes of interim review, if the plan appears to contain information demonstrating that the SO2 emissions rate and heat input of the unit and all other applicable parameters are monitored and reported in accordance with subpart HHH of this part. A determination of sufficiency shall not be construed as acceptance or approval of the monitoring plan.

(b) Monitoring and reporting. (1)(i) If the permitting authority and the Administrator determine that the monitoring plan is sufficient under paragraph (a) of this section, the owner or operator shall monitor and report the SO2 emissions rate and the heat input of the unit and all other applicable parameters, in accordance with subpart HHH of this part, starting on the date of certification of the appropriate monitoring systems under subpart HHH of this part and continuing until a CAIR opt-in permit is denied under § 97.284(f) or, if a CAIR opt-in permit is issued, the date and time when the unit is withdrawn from the CAIR SO2 Trading Program in accordance with § 97.286.

(ii) The monitoring and reporting under paragraph (b)(1)(i) of this section shall include the entire control period immediately before the date on which the unit enters the CAIR SO2 Trading Program under § 97.284(g), during which period monitoring system availability must not be less than 90 percent under subpart HHH of this part and the unit must be in full compliance with any applicable State or Federal emissions or emissions-related requirements.

(2) To the extent the SO2 emissions rate and the heat input of the unit are monitored and reported in accordance with subpart HHH of this part for one or more control periods, in addition to the control period under paragraph (b)(1)(ii) of this section, during which control periods monitoring system availability is not less than 90 percent under subpart HHH of this part and the unit is in full compliance with any applicable State or Federal emissions or emissions-related requirements and which control periods begin not more than 3 years before the unit enters the CAIR SO2 Trading Program under § 97.284(g), such information shall be used as provided in paragraphs (c) and (d) of this section.

(c) Baseline heat input. The unit's baseline heat input shall equal:

(1) If the unit's SO2 emissions rate and heat input are monitored and reported for only one control period, in accordance with paragraph (b)(1) of this section, the unit's total heat input (in mmBtu) for the control period; or

(2) If the unit's SO2 emissions rate and heat input are monitored and reported for more than one control period, in accordance with paragraphs (b)(1) and (2) of this section, the average of the amounts of the unit's total heat input (in mmBtu) for the control periods under paragraphs (b)(1)(ii) and (2) of this section.

(d) Baseline SO2 emission rate. The unit's baseline SO2 emission rate shall equal:

(1) If the unit's SO2 emissions rate and heat input are monitored and reported for only one control period, in accordance with paragraph (b)(1) of this section, the unit's SO2 emissions rate (in lb/mmBtu) for the control period;

(2) If the unit's SO2 emissions rate and heat input are monitored and reported for more than one control period, in accordance with paragraphs (b)(1) and (2) of this section, and the unit does not have add-on SO2 emission controls during any such control periods, the average of the amounts of the unit's SO2 emissions rate (in lb/mmBtu) for the control periods under paragraphs (b)(1)(ii) and (2) of this section; or

(3) If the unit's SO2 emissions rate and heat input are monitored and reported for more than one control period, in accordance with paragraphs (b)(1) and (2) of this section, and the unit has add-on SO2 emission controls during any such control periods, the average of the amounts of the unit's SO2 emissions rate (in lb/mmBtu) for such control periods during which the unit has add-on SO2 emission controls.

(e) Issuance of CAIR opt-in permit. After calculating the baseline heat input and the baseline SO2 emissions rate for the unit under paragraphs (c) and (d) of this section and if the permitting authority determines that the CAIR designated representative shows that the unit meets the requirements for a CAIR SO2 opt-in unit in § 97.280 and meets the elements certified in § 97.283(a)(2), the permitting authority will issue a CAIR opt-in permit. The permitting authority will provide a copy of the CAIR opt-in permit to the Administrator, who will then establish a compliance account for the source that includes the CAIR SO2 opt-in unit unless the source already has a compliance account.

(f) Issuance of denial of CAIR opt-in permit. Notwithstanding paragraphs (a) through (e) of this section, if at any time before issuance of a CAIR opt-in permit for the unit, the permitting authority determines that the CAIR designated representative fails to show that the unit meets the requirements for a CAIR SO2 opt-in unit in § 97.280 or meets the elements certified in § 97.283(a)(2), the permitting authority will issue a denial of a CAIR opt-in permit for the unit.

(g) Date of entry into CAIR SO2 Trading Program. A unit for which an initial CAIR opt-in permit is issued by the permitting authority shall become a CAIR SO2 opt-in unit, and a CAIR SO2 unit, as of the later of January 1, 2010 or January 1 of the first control period during which such CAIR opt-in permit is issued.

(h) Repowered CAIR SO2 opt-in unit. (1) If CAIR designated representative requests, and the permitting authority issues a CAIR opt-in permit providing for, allocation to a CAIR SO2 opt-in unit of CAIR SO2 allowances under § 97.288(c) and such unit is repowered after its date of entry into the CAIR SO2 Trading Program under paragraph (g) of this section, the repowered unit shall be treated as a CAIR SO2 opt-in unit replacing the original CAIR SO2 opt-in unit, as of the date of start-up of the repowered unit's combustion chamber.

(2) Notwithstanding paragraphs (c) and (d) of this section, as of the date of start-up under paragraph (h)(1) of this section, the repowered unit shall be deemed to have the same date of commencement of operation, date of commencement of commercial operation, baseline heat input, and baseline SO2 emission rate as the original CAIR SO2 opt-in unit, and the original CAIR SO2 opt-in unit shall no longer be treated as a CAIR SO2 opt-in unit or a CAIR SO2 unit.

(a) Each CAIR opt-in permit will contain:

(1) All elements required for a complete CAIR permit application under § 97.222;

(2) The certification in § 97.283(a)(2);

(3) The unit's baseline heat input under § 97.284(c);

(4) The unit's baseline SO2 emission rate under § 97.284(d);

(5) A statement whether the unit is to be allocated CAIR SO2 allowances under § 97.288(b) or § 97.288(c) (subject to the conditions in §§ 97.284(h) and 97.286(g));

(6) A statement that the unit may withdraw from the CAIR SO2 Trading Program only in accordance with § 97.286; and

(7) A statement that the unit is subject to, and the owners and operators of the unit must comply with, the requirements of § 97.287.

(b) Each CAIR opt-in permit is deemed to incorporate automatically the definitions of terms under § 97.202 and, upon recordation by the Administrator under subpart FFF or GGG of this part or this subpart, every allocation, transfer, or deduction of CAIR SO2 allowances to or from the compliance account of the source that includes a CAIR SO2 opt-in unit covered by the CAIR opt-in permit.

(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 SO2 opt-in unit is located and in a title V operating permit or other federally enforceable permit for the source.

Except as provided under paragraph (g) of this section, a CAIR SO2 opt-in unit may withdraw from the CAIR SO2 Trading Program, but only if the permitting authority issues a notification to the CAIR designated representative of the CAIR SO2 opt-in unit of the acceptance of the withdrawal of the CAIR SO2 opt-in unit in accordance with paragraph (d) of this section.

(a) Requesting withdrawal. In order to withdraw a CAIR SO2 opt-in unit from the CAIR SO2 Trading Program, the CAIR designated representative of the CAIR SO2 opt-in unit shall submit to the permitting authority a request to withdraw effective as of midnight of December 31 of a specified calendar year, which date must be at least 4 years after December 31 of the year of entry into the CAIR SO2 Trading Program under § 97.284(g). The request must be submitted no later than 90 days before the requested effective date of withdrawal.

(b) Conditions for withdrawal. Before a CAIR SO2 opt-in unit covered by a request under paragraph (a) of this section may withdraw from the CAIR SO2 Trading Program and the CAIR opt-in permit may be terminated under paragraph (e) of this section, the following conditions must be met:

(1) For the control period ending on the date on which the withdrawal is to be effective, the source that includes the CAIR SO2 opt-in unit must meet the requirement to hold CAIR SO2 allowances under § 97.206(c) and cannot have any excess emissions.

(2) After the requirement for withdrawal under paragraph (b)(1) of this section is met, the Administrator will deduct from the compliance account of the source that includes the CAIR SO2 opt-in unit CAIR SO2 allowances equal in amount to and allocated for the same or a prior control period as any CAIR SO2 allowances allocated to the CAIR SO2 opt-in unit under § 97.288 for any control period for which the withdrawal is to be effective. If there are no remaining CAIR SO2 units at the source, the Administrator will close the compliance account, and the owners and operators of the CAIR SO2 opt-in unit may submit a CAIR SO2 allowance transfer for any remaining CAIR SO2 allowances to another CAIR SO2 Allowance Tracking System in accordance with subpart GGG of this part.

(c) Notification. (1) After the requirements for withdrawal under paragraphs (a) and (b) of this section are met (including deduction of the full amount of CAIR SO2 allowances required), the permitting authority will issue a notification to the CAIR designated representative of the CAIR SO2 opt-in unit of the acceptance of the withdrawal of the CAIR SO2 opt-in unit as of midnight on December 31 of the calendar year for which the withdrawal was requested.

(2) If the requirements for withdrawal under paragraphs (a) and (b) of this section are not met, the permitting authority will issue a notification to the CAIR designated representative of the CAIR SO2 opt-in unit that the CAIR SO2 opt-in unit's request to withdraw is denied. Such CAIR SO2 opt-in unit shall continue to be a CAIR SO2 opt-in unit.

(d) Permit amendment. After the permitting authority issues a notification under paragraph (c)(1) of this section that the requirements for withdrawal have been met, the permitting authority will revise the CAIR permit covering the CAIR SO2 opt-in unit to terminate the CAIR opt-in permit for such unit as of the effective date specified under paragraph (c)(1) of this section. The unit shall continue to be a CAIR SO2 opt-in unit until the effective date of the termination and shall comply with all requirements under the CAIR SO2 Trading Program concerning any control periods for which the unit is a CAIR SO2 opt-in unit, even if such requirements arise or must be complied with after the withdrawal takes effect.

(e) Reapplication upon failure to meet conditions of withdrawal. If the permitting authority denies the CAIR SO2 opt-in unit's request to withdraw, the CAIR designated representative may submit another request to withdraw in accordance with paragraphs (a) and (b) of this section.

(f) Ability to reapply to the CAIR SO2 Trading Program. Once a CAIR SO2 opt-in unit withdraws from the CAIR SO2 Trading Program and its CAIR opt-in permit is terminated under this section, the CAIR designated representative may not submit another application for a CAIR opt-in permit under § 97.283 for such CAIR SO2 opt-in unit before the date that is 4 years after the date on which the withdrawal became effective. Such new application for a CAIR opt-in permit will be treated as an initial application for a CAIR opt-in permit under § 97.284.

(g) Inability to withdraw. Notwithstanding paragraphs (a) through (f) of this section, a CAIR SO2 opt-in unit shall not be eligible to withdraw from the CAIR SO2 Trading Program if the CAIR designated representative of the CAIR SO2 opt-in unit requests, and the permitting authority issues a CAIR opt-in permit providing for, allocation to the CAIR SO2 opt-in unit of CAIR SO2 allowances under § 97.288(c).

(a) Notification. If a CAIR SO2 opt-in unit becomes a CAIR SO2 unit under § 97.204, then the CAIR designated representative shall notify in writing the permitting authority and the Administrator of such change in the CAIR SO2 opt-in unit's regulatory status, within 30 days of such change.

(b) Permitting authority's and Administrator's actions. (1) If a CAIR SO2 opt-in unit becomes a CAIR SO2 unit under § 97.204, the permitting authority will revise the CAIR SO2 opt-in unit's CAIR opt-in permit to meet the requirements of a CAIR permit under § 97.223, and remove the CAIR opt-in permit provisions, as of the date on which the CAIR SO2 opt-in unit becomes a CAIR SO2 unit under § 97.204.

(2)(i) The Administrator will deduct from the compliance account of the source that includes the CAIR SO2 opt-in unit that becomes a CAIR SO2 unit under § 97.204, CAIR SO2 allowances equal in amount to and allocated for the same or a prior control period as:

(A) Any CAIR SO2 allowances allocated to the CAIR SO2 opt-in unit under § 97.288 for any control period after the date on which the CAIR SO2 opt-in unit becomes a CAIR SO2 unit under § 97.204; and

(B) If the date on which the CAIR SO2 opt-in unit becomes a CAIR SO2 unit under § 97.204 is not December 31, the CAIR SO2 allowances allocated to the CAIR SO2 opt-in unit under § 97.288 for the control period that includes the date on which the CAIR SO2 opt-in unit becomes a CAIR SO2 unit under § 97.204, multiplied by the ratio of the number of days, in the control period, starting with the date on which the CAIR SO2 opt-in unit becomes a CAIR SO2 unit under § 97.204 divided by the total number of days in the control period and rounded to the nearest whole allowance as appropriate.

(ii) The CAIR designated representative shall ensure that the compliance account of the source that includes the CAIR SO2 opt-in unit that becomes a CAIR SO2 unit under § 97.204 contains the CAIR SO2 allowances necessary for completion of the deduction under paragraph (b)(2)(i) of this section.

(a) Timing requirements. (1) When the CAIR opt-in permit is issued under § 97.284(e), the permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit, and submit to the Administrator the allocation for the control period in which a CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 97.284(g), in accordance with paragraph (b) or (c) of this section.

(2) By no later than October 31 of the control period after the control period in which a CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 97.284(g) and October 31 of each year thereafter, the permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit, and submit to the Administrator the allocation for the control period that includes such submission deadline and in which the unit is a CAIR SO2 opt-in unit, in accordance with paragraph (b) or (c) of this section.

(b) Calculation of allocation. For each control period for which a CAIR SO2 opt-in unit is to be allocated CAIR SO2 allowances, the permitting authority will allocate in accordance with the following procedures, if provided in a State implementation plan revision submitted in accordance with § 51.124(r)(1), (2), or (3) of this chapter and approved by the Administrator:

(1) The heat input (in mmBtu) used for calculating the CAIR SO2 allowance allocation will be the lesser of:

(i) The CAIR SO2 opt-in unit's baseline heat input determined under § 97.284(c); or

(ii) The CAIR SO2 opt-in unit's heat input, as determined in accordance with subpart HHH of this part, for the immediately prior control period, except when the allocation is being calculated for the control period in which the CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 97.284(g).

(2) The SO2 emission rate (in lb/mmBtu) used for calculating CAIR SO2 allowance allocations will be the lesser of:

(i) The CAIR SO2 opt-in unit's baseline SO2 emissions rate (in lb/mmBtu) determined under § 97.284(d) and multiplied by 70 percent; or

(ii) The most stringent State or Federal SO2 emissions limitation applicable to the CAIR SO2 opt-in unit at any time during the control period for which CAIR SO2 allowances are to be allocated.

(3) The permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit with a tonnage equivalent equal to, or less than by the smallest possible amount, the heat input under paragraph (b)(1) of this section, multiplied by the SO2 emission rate under paragraph (b)(2) of this section, and divided by 2,000 lb/ton.

(c) Notwithstanding paragraph (b) of this section and if the CAIR designated representative requests, and the permitting authority issues a CAIR opt-in permit (based on a demonstration of the intent to repower stated under § 97.283(a)(5)) providing for, allocation to a CAIR SO2 opt-in unit of CAIR SO2 allowances under this paragraph (subject to the conditions in §§ 97.284(h) and 97.286(g)), the permitting authority will allocate to the CAIR SO2 opt-in unit as follows, if provided in a State implementation plan revision submitted in accordance with § 51.124(r)(1), (2), or (3) of this chapter and approved by the Administrator:

(1) For each control period in 2010 through 2014 for which the CAIR SO2 opt-in unit is to be allocated CAIR SO2 allowances,

(i) The heat input (in mmBtu) used for calculating CAIR SO2 allowance allocations will be determined as described in paragraph (b)(1) of this section.

(ii) The SO2 emission rate (in lb/mmBtu) used for calculating CAIR SO2 allowance allocations will be the lesser of:

(A) The CAIR SO2 opt-in unit's baseline SO2 emissions rate (in lb/mmBtu) determined under § 97.284(d); or

(B) The most stringent State or Federal SO2 emissions limitation applicable to the CAIR SO2 opt-in unit at any time during the control period in which the CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 97.284(g).

(iii) The permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit with a tonnage equivalent equal to, or less than by the smallest possible amount, the heat input under paragraph (c)(1)(i) of this section, multiplied by the SO2 emission rate under paragraph (c)(1)(ii) of this section, and divided by 2,000 lb/ton.

(2) For each control period in 2015 and thereafter for which the CAIR SO2 opt-in unit is to be allocated CAIR SO2 allowances,

(i) The heat input (in mmBtu) used for calculating the CAIR SO2 allowance allocations will be determined as described in paragraph (b)(1) of this section.

(ii) The SO2 emission rate (in lb/mmBtu) used for calculating the CAIR SO2 allowance allocation will be the lesser of:

(A) The CAIR SO2 opt-in unit's baseline SO2 emissions rate (in lb/mmBtu) determined under § 97.284(d) multiplied by 10 percent; or

(B) The most stringent State or Federal SO2 emissions limitation applicable to the CAIR SO2 opt-in unit at any time during the control period for which CAIR SO2 allowances are to be allocated.

(iii) The permitting authority will allocate CAIR SO2 allowances to the CAIR SO2 opt-in unit with a tonnage equivalent equal to, or less than by the smallest possible amount, the heat input under paragraph (c)(2)(i) of this section, multiplied by the SO2 emission rate under paragraph (c)(2)(ii) of this section, and divided by 2,000 lb/ton.

(d) Recordation. If provided in a State implementation plan revision submitted in accordance with § 51.124(r)(1), (2), or (3) of this chapter and approved by the Administrator:

(1) The Administrator will record, in the compliance account of the source that includes the CAIR SO2 opt-in unit, the CAIR SO2 allowances allocated by the permitting authority to the CAIR SO2 opt-in unit under paragraph (a)(1) of this section.

(2) By December 1 of the control period in which a CAIR SO2 opt-in unit enters the CAIR SO2 Trading Program under § 97.284(g) and December 1 of each year thereafter, the Administrator will record, in the compliance account of the source that includes the CAIR SO2 opt-in unit, the CAIR SO2 allowances allocated by the permitting authority to the CAIR SO2 opt-in unit under paragraph (a)(2) of this section.

1. The following States have State Implementation Plan revisions under § 51.124(r) of this chapter approved by the Administrator and establishing procedures providing for CAIR SO2 opt-in units under subpart III of this part and allocation of CAIR SO2 allowances to such units under § 97.288(b):

2. The following States have State Implementation Plan revisions under § 51.124(r) of this chapter approved by the Administrator and establishing procedures providing for CAIR SO2 opt-in units under subpart III of this part and allocation of CAIR SO2 allowances to such units under § 97.288(c):