[Federal Register Volume 89, Number 42 (Friday, March 1, 2024)]
[Notices]
[Pages 15199-15201]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-04291]


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ENVIRONMENTAL PROTECTION AGENCY

[FRL-9542-05-OAR]


Information Regarding Allowances Used in Cross-State Air 
Pollution Rule (CSAPR) Trading Programs

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of data availability.

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SUMMARY: The Environmental Protection Agency (EPA) is providing notice 
of the availability of data on emission allowance allocations to 
certain units under the Cross-State Air Pollution Rule (CSAPR) trading 
programs. EPA has completed preliminary calculations for the 
allocations of allowances from the new unit set-asides (NUSAs) for the 
2023 control periods and has posted spreadsheets containing the 
calculations on EPA's website. EPA will consider timely objections to 
the preliminary calculations (including objections concerning the 
identification of units eligible for allocations) before determining 
the final amounts of the allocations. Additionally, EPA is making 
available an estimate of the data and calculations to be used in the 
allowance bank recalibration process for the 2024 control period under 
the CSAPR NOX Ozone Season Group 3 Trading Program.

DATES: Objections to the information referenced in this notice 
concerning NUSA allocations must be received on or before April 1, 
2024.

ADDRESSES: Submit your objections via email to [email protected]. Include 
``2023 NUSA allocations'' in the email subject line and include your 
name, title, affiliation, address, phone number, and email address in 
the body of the email.

FOR FURTHER INFORMATION CONTACT: Questions concerning this action 
should be addressed to Garrett Powers at (202) 564-2300 or 
[email protected] or Morgan Riedel at (202) 564-1144 or 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Allocations From New Unit Set-Asides

    Under each CSAPR trading program where EPA is responsible for 
determining emission allowance

[[Page 15200]]

allocations, a portion of each state's emissions budget for the program 
for each control period is reserved in a NUSA (and, under most of the 
trading programs, in an additional Indian country NUSA in the case of 
states with Indian country within their borders) for allocation to 
certain units that would not otherwise receive allowance allocations. 
The procedures for identifying the eligible units for each control 
period and for allocating allowances from the NUSAs and Indian country 
NUSAs to these units are set forth in the CSAPR trading program 
regulations at 40 CFR 97.411(b) and 97.412 (NOX Annual), 
97.511(b) and 97.512 (NOX Ozone Season Group 1), 97.611(b) 
and 97.612 (SO2 Group 1), 97.711(b) and 97.712 
(SO2 Group 2), 97.811(b) and 97.812 (NOX Ozone 
Season Group 2), and 97.1012 (NOX Ozone Season Group 3). 
Each NUSA allowance allocation process involves allocations to eligible 
units, termed ``new'' units, followed by the allocation to ``existing'' 
units of any allowances not allocated to new units.\1\
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    \1\ The CSAPR NOX Ozone Season Group 3 Trading 
Program serves as the compliance mechanism for electricity 
generating units under the Good Neighbor Plan (88 FR 36654, June 5, 
2023). As of the date of signature of this notice, applications for 
a stay of the Good Neighbor Plan are pending before the Supreme 
Court of the United States. If a stay order is issued and depending 
on its nature, it could affect EPA's ability to implement the 
regulatory provisions of the CSAPR NOX Ozone Season Group 
3 Trading Program that are described in this notice.
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    This notice concerns preliminary calculations for the NUSA 
allowance allocations for the 2023 control periods. Generally, the 
allocation procedures call for each eligible ``new'' unit to receive a 
2023 NUSA allocation equal to its 2023 control period emissions as 
reported under 40 CFR part 75 unless the total of such allocations to 
all such eligible units would exceed the amount of allowances in the 
NUSA, in which case the allocations are reduced on a pro-rata basis. 
(EPA notes that, under 40 CFR 97.406(c)(3), 97.506(c)(3), 97.606(c)(3), 
97.706(c)(3), 97.806(c)(3), and 97.1006(c)(3), a unit's emissions 
occurring before its monitor certification deadline are not considered 
to have occurred during a control period and consequently are not 
included in the emission amounts used to determine NUSA allocations.) 
Any allowances not allocated to eligible ``new'' units are allocated to 
the state's ``existing'' units in proportion to such existing units' 
previous allocations from the portion of the respective state's 
emissions budget for the control period that was not reserved in a NUSA 
(or Indian country NUSA).
    The detailed unit-by-unit data and preliminary allowance allocation 
calculations for ``new'' units are set forth in Excel spreadsheets 
titled ``CSAPR_NUSA_2023_NOX_Annual_Prelim_Data_New_Units'', 
``CSAPR_NUSA_2023_NOX_OS_Prelim_Data_New_Units'', and 
``CSAPR_NUSA_2023_SO2_Prelim_Data_New_Units'', available on 
EPA's website at www.epa.gov/csapr/csapr-allowance-allocations#nusa. 
Each of the spreadsheets contains a separate worksheet for each state 
covered by that program showing, for each unit identified as eligible 
for a NUSA allocation, (1) the unit's emissions in the 2023 control 
period (annual or ozone season as applicable), (2) the maximum 2023 
NUSA allowance allocation for which the unit is eligible (typically the 
unit's emissions in the 2023 control period), (3) various adjustments 
to the unit's maximum allocation if the NUSA pool is oversubscribed, 
and (4) the preliminary calculation of the unit's 2023 NUSA allowance 
allocation.
    Each state worksheet for ``new'' units also contains a summary 
showing (1) the quantity of allowances initially available in that 
state's 2023 NUSA, (2) the sum of the 2023 NUSA allowance allocations 
that will be made to new units in that state, assuming there are no 
corrections to the data, and (3) the quantity of allowances that would 
remain in the 2023 NUSA for allocation to existing units, again 
assuming there are no corrections to the data.
    The preliminary calculations of allocations of the remaining 
unallocated allowances to ``existing'' units are set forth in Excel 
spreadsheets titled 
``CSAPR_NUSA_2023_NOX_Annual_Prelim_Data_Existing_Units'', 
``CSAPR_NUSA_2023_NOX_OS_Prelim_Data_Existing_Units'', and 
``CSAPR_NUSA_2023_SO2_Prelim_Data_Existing_Units'', 
available at the same location.
    Objections should be strictly limited to the data and calculations 
upon which the NUSA allowance allocations are based and should be 
emailed to the address identified in ADDRESSES. Objections must 
include: (1) precise identification of the specific data and/or 
calculations the commenter believes are inaccurate, (2) new proposed 
data and/or calculations upon which the commenter believes EPA should 
rely instead to determine allowance allocations, and (3) the reasons 
why EPA should rely on the commenter's proposed data and/or 
calculations and not the data referenced in this notice.
    EPA notes that an allocation or lack of allocation of allowances to 
a given unit under a given CSAPR trading program does not constitute a 
determination that the trading program does or does not apply to the 
unit. EPA also notes that, under 40 CFR 97.411(c), 97.511(c), 
97.611(c), 97.711(c), 97.811(c), 97.1011(c), and 97.1012(c), 
allocations are subject to potential correction if a unit to which 
allowances have been allocated for a given control period is not 
actually an affected unit as of the start of that control period.

II. Information for the Allowance Bank Recalibration Procedures

    The CSAPR NOX Ozone Season Group 3 Trading Program 
includes provisions calling for EPA to annually recalibrate the bank of 
CSAPR NOX Ozone Season Group 3 allowances if the total 
quantity of banked allowances from previous control periods held in all 
facility and general accounts after compliance deductions for those 
control periods exceeds an allowance bank ceiling target for the 
current control period. The allowance bank recalibration procedures are 
set forth in the trading program regulations at 40 CFR 97.1026(d). 
Generally, if recalibration takes place for a given control period, the 
amount of banked CSAPR NOX Ozone Season Group 3 allowances 
from previous control periods held in each facility or general account 
will be adjusted so that the amount of such banked allowances held in 
the account after recalibration will equal the amount held in the 
account immediately before recalibration multiplied by the allowance 
bank ceiling target, divided by the total amount of such banked 
allowances held in all facility and general accounts immediately before 
recalibration, and rounded up to the nearest allowance. Allowance bank 
recalibration for a given control period applies only to holdings of 
banked allowances issued for previous control periods; it does not 
affect any holdings of allowances issued for that control period. The 
regulations call for EPA to carry out the allowance bank recalibration 
procedures for the 2024 control period as soon as practicable on or 
after August 1, 2024.\2\
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    \2\ See note 1, supra.
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    For the 2024 control period, the allowance bank ceiling target is 
expected to be 12,605 tons, computed as 21% the sum of the 2024 state 
emission budgets for the ten states currently covered by the trading 
program. Based on the emissions and allowance data available at 
campd.epa.gov as of the date of signature of this notice, EPA estimates 
that after allowance deductions for 2023 compliance are completed in 
June 2024, approximately

[[Page 15201]]

38,585 banked vintage 2021-2023 allowances will be held in facility or 
general accounts (84,378 current allowance holdings + 3,365 upcoming 
NUSA allocations-49,158 reported 2023 ozone season emissions = 38,585 
estimated remaining allowances). Based on these figures, EPA expects 
that allowance bank recalibration will take place for the 2024 control 
period and estimates that the amount of banked vintage 2021-2023 
allowances that will be held in each facility or general account after 
recalibration will be the amount of such banked allowances held in the 
account immediately before recalibration multiplied by 12,605 and 
divided by 38,585 (or, equivalently, the amount of such banked 
allowances held in the account immediately before recalibration 
multiplied by approximately 33%). In the actual allowance bank 
recalibration process, instead of using the estimated figures described 
in this notice, EPA will use the most current information available as 
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of the recalibration date.

(Authority: 40 CFR 97.411(b), 97.511(b), 97.611(b), 97.711(b), 
97.811(b), and 97.1012(a).)

Rona Birnbaum,
Director, Clean Air Markets Division, Office of Atmospheric Protection, 
Office of Air and Radiation.
[FR Doc. 2024-04291 Filed 2-29-24; 8:45 am]
BILLING CODE 6560-50-P