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92_SB0372enr SB372 Enrolled LRB9205013LBgc 1 AN ACT concerning environmental protection. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The Environmental Protection Act is amended 5 by changing Section 9.9 and adding Section 9.10 as follows: 6 (415 ILCS 5/9.9) 7 Sec. 9.9. Nitrogen oxides trading system. 8 (a) The General Assembly finds: 9 (1) That USEPA has issued a Final Rule published in 10 the Federal Register on October 27, 1998, entitled 11 "Finding of Significant Contribution and Rulemaking for 12 Certain States in the Ozone Transport Assessment Group 13 Region for Purposes of Reducing Regional Transport of 14 Ozone", hereinafter referred to as the "NOx SIP Call", 15 compliance with which will require reducing emissions of 16 nitrogen oxides ("NOx"); 17 (2) That reducing emissions of NOx in the State 18 helps the State to meet the national ambient air quality 19 standard for ozone; 20 (3) That emissions trading is a cost-effective 21 means of obtaining reductions of NOx emissions. 22 (b) The Agency shall propose and the Board shall adopt 23 regulations to implement an interstate NOx trading program 24 (hereinafter referred to as the "NOx Trading Program") as 25 provided for in 40 CFR Part 96, including incorporation by 26 reference of appropriate provisions of 40 CFR Part 96 and 27 regulations to address 40 CFR Section 96.4(b), Section 28 96.55(c), Subpart E, and Subpart I. In addition, the Agency 29 shall propose and the Board shall adopt regulations to 30 implement NOx emission reduction programs for cement kilns 31 and stationary internal combustion engines. SB372 Enrolled -2- LRB9205013LBgc 1 (c) Allocations of NOx allowances to large electric 2 generating units ("EGUs") and large non-electric generating 3 units ("non-EGUs"), as defined by 40 CFR Part 96.4(a), shall 4 not exceed the State's trading budget for those source 5 categories to be included in the State Implementation Plan 6 for NOx. 7 (d) In adopting regulations to implement the NOx Trading 8 Program, the Board shall: 9 (1) assure that the economic impact and technical 10 feasibility of NOx emissions reductions under the NOx 11 Trading Program are considered relative to the 12 traditional regulatory control requirements in the State 13 for EGUs and non-EGUs; 14 (2) provide that emission units, as defined in 15 Section 39.5(1) of this Act, may opt into the NOx Trading 16 Program; 17 (3) provide for voluntary reductions of NOx 18 emissions from emission units, as defined in Section 19 39.5(1) of this Act, not otherwise included under 20 paragraph (c) or (d)(2) of this Section to provide 21 additional allowances to EGUs and non-EGUs to be 22 allocated by the Agency. The regulations shall further 23 provide that such voluntary reductions are verifiable, 24 quantifiable, permanent, and federally enforceable; 25 (4) provide that the Agency allocate to non-EGUs 26 allowances that are designated in the rule, unless the 27 Agency has been directed to transfer the allocations to 28 another unit subject to the requirements of the NOx 29 Trading Program, and that upon shutdown of a non-EGU, the 30 unit may transfer or sell the NOx allowances that are 31 allocated to such unit; and 32 (5) provide that the Agency shall set aside 33 annually a number of allowances, not to exceed 5% of the 34 total EGU trading budget, to be made available to new SB372 Enrolled -3- LRB9205013LBgc 1 EGUs. 2 (A) Those EGUs that commence commercial 3 operation, as defined in 40 CFR Section 96.2, at a 4 time that is more than half way through the control 5 period in 2003
2002shall return to the Agency any 6 allowances that were issued to it by the Agency and 7 were not used for compliance in 2004 2003. 8 (B) The Agency may charge EGUs that commence 9 commercial operation, as defined in 40 CFR Section 10 96.2, on or after January 1, 2003, for the 11 allowances it issues to them. 12 (e) The Agency may adopt procedural rules, as necessary, 13 to implement the regulations promulgated by the Board 14 pursuant to subsections (b) and (d) and to implement 15 subsection (i) of this Section. 16 (f) Notwithstanding any provisions in subparts T, U, and 17 W of Section 217 of Title 35 of the Illinois Administrative 18 Code to the contrary, compliance with the regulations 19 promulgated by the Board pursuant to subsections (b) and (d) 20 of this Section is required by May 31, 2004. The regulations21 promulgated by the Board pursuant to subsections (b) and (d)22 of this Section shall not be enforced until the later of May23 1, 2003, or the first day of the control season subsequent to24 the calendar year in which all of the other states subject to25 the provisions of the NOx SIP Call that are located in USEPA26 Region V or that are contiguous to Illinois have adopted27 regulations to implement NOx trading programs and other28 required reductions of NOx emissions pursuant to the NOx SIP29 Call, and such regulations have received final approval by30 USEPA as part of the respective states' SIPS for ozone, or a31 final FIP for ozone promulgated by USEPA is effective for32 such other states.33 (g) To the extent that a court of competent jurisdiction 34 finds a provision of 40 CFR Part 96 invalid, the SB372 Enrolled -4- LRB9205013LBgc 1 corresponding Illinois provision shall be stayed until such 2 provision of 40 CFR Part 96 is found to be valid or is 3 re-promulgated. To the extent that USEPA or any court of 4 competent jurisdiction stays the applicability of any 5 provision of the NOx SIP Call to any person or circumstance 6 relating to Illinois, during the period of that stay, the 7 effectiveness of the corresponding Illinois provision shall 8 be stayed. To the extent that the invalidity of the 9 particular requirement or application does not affect other 10 provisions or applications of the NOx SIP Call pursuant to 40 11 CFR 51.121 or the NOx trading program pursuant to 40 CFR Part 12 96 or 40 CFR Part 97, this Section, and rules or regulations 13 promulgated hereunder, will be given effect without the 14 invalid provisions or applications. 15 (h) Notwithstanding any other provision of this Act, any 16 source or other authorized person that participates in the 17 NOx Trading Program shall be eligible to exchange NOx 18 allowances with other sources in accordance with this Section 19 and with regulations promulgated by the Board or the Agency. 20 (i) There is hereby created within the State Treasury an 21 interest-bearing special fund to be known as the NOx Trading 22 System Fund, which shall be used and administered by the 23 Agency for the purposes stated below: 24 (1) To accept funds from persons who purchase NOx 25 allowances from the Agency; 26 (2) To disburse the proceeds of the NOx allowances 27 sales pro-rata to the owners or operators of the EGUs 28 that received allowances from the Agency but not from the 29 Agency's set-aside, in accordance with regulations that 30 may be promulgated by the Agency; and 31 (3) To finance the reasonable costs incurred by the 32 Agency in the administration of the NOx Trading System. 33 (Source: P.A. 91-631, eff. 8-19-99.) SB372 Enrolled -5- LRB9205013LBgc 1 (415 ILCS 5/9.10 new) 2 Sec. 9.10. Fossil fuel-fired electric generating plants. 3 (a) The General Assembly finds and declares that: 4 (1) fossil fuel-fired electric generating plants 5 are a significant source of air emissions in this State 6 and have become the subject of a number of important new 7 studies of their effects on the public health; 8 (2) existing state and federal policies, that allow 9 older plants that meet federal standards to operate 10 without meeting the more stringent requirements 11 applicable to new plants, are being questioned on the 12 basis of their environmental impacts and the economic 13 distortions such policies cause in a deregulated energy 14 market; 15 (3) fossil fuel-fired electric generating plants 16 are, or may be, affected by a number of regulatory 17 programs, some of which are under review or development 18 on the state and national levels, and to a certain extent 19 the international level, including the federal acid rain 20 program, tropospheric ozone, mercury and other hazardous 21 pollutant control requirements, regional haze, and global 22 warming; 23 (4) scientific uncertainty regarding the formation 24 of certain components of regional haze and the air 25 quality modeling that predict impacts of control measures 26 requires careful consideration of the timing of the 27 control of some of the pollutants from these facilities, 28 particularly sulfur dioxides and nitrogen oxides that 29 each interact with ammonia and other substances in the 30 atmosphere; 31 (5) the development of energy policies to promote a 32 safe, sufficient, reliable, and affordable energy supply 33 on the state and national levels is being affected by the 34 on-going deregulation of the power generation industry SB372 Enrolled -6- LRB9205013LBgc 1 and the evolving energy markets; 2 (6) the Governor's formation of an Energy Cabinet 3 and the development of a State energy policy calls for 4 actions by the Agency and the Board that are in harmony 5 with the energy needs and policy of the State, while 6 protecting the public health and the environment; 7 (7) Illinois coal is an abundant resource and an 8 important component of Illinois' economy whose use should 9 be encouraged to the greatest extent possible consistent 10 with protecting the public health and the environment; 11 (8) renewable forms of energy should be promoted as 12 an important element of the energy and environmental 13 policies of the State and that it is a goal of the State 14 that at least 5% of the State's energy production and use 15 be derived from renewable forms of energy by 2010 and at 16 least 15% from renewable forms of energy by 2020; 17 (9) efforts on the state and federal levels are 18 underway to consider the multiple environmental 19 regulations affecting electric generating plants in order 20 to improve the ability of government and the affected 21 industry to engage in effective planning through the use 22 of multi-pollutant strategies; and 23 (10) these issues, taken together, call for a 24 comprehensive review of the impact of these facilities on 25 the public health, considering also the energy supply, 26 reliability, and costs, the role of renewable forms of 27 energy, and the developments in federal law and 28 regulations that may affect any state actions, prior to 29 making final decisions in Illinois. 30 (b) Taking into account the findings and declarations of 31 the General Assembly contained in subsection (a) of this 32 Section, the Agency shall, before September 30, 2004, but not 33 before September 30, 2003, issue to the House and Senate 34 Committees on Environment and Energy findings that address SB372 Enrolled -7- LRB9205013LBgc 1 the potential need for the control or reduction of emissions 2 from fossil fuel-fired electric generating plants, including 3 the following provisions: 4 (1) reduction of nitrogen oxide emissions, as 5 appropriate, with consideration of maximum annual 6 emissions rate limits or establishment of an emissions 7 trading program and with consideration of the 8 developments in federal law and regulations that may 9 affect any State action, prior to making final decisions 10 in Illinois; 11 (2) reduction of sulfur dioxide emissions, as 12 appropriate, with consideration of maximum annual 13 emissions rate limits or establishment of an emissions 14 trading program and with consideration of the 15 developments in federal law and regulations that may 16 affect any State action, prior to making final decisions 17 in Illinois; 18 (3) incentives to promote renewable sources of 19 energy consistent with item (8) of subsection (a) of 20 this Section; 21 (4) reduction of mercury as appropriate, 22 consideration of the availability of control technology, 23 industry practice requirements, or incentive programs, or 24 some combination of these approaches that are sufficient 25 to prevent unacceptable local impacts from individual 26 facilities and with consideration of the developments in 27 federal law and regulations that may affect any state 28 action, prior to making final decisions in Illinois; and 29 (5) establishment of a banking system, consistent 30 with the United States Department of Energy's voluntary 31 reporting system, for certifying credits for voluntary 32 offsets of emissions of greenhouse gases, as identified 33 by the United States Environmental Protection Agency, or 34 other voluntary reductions of greenhouse gases. Such SB372 Enrolled -8- LRB9205013LBgc 1 reduction efforts may include, but are not limited to, 2 carbon sequestration, technology-based control measures, 3 energy efficiency measures, and the use of renewable 4 energy sources. 5 The Agency shall consider the impact on the public 6 health, considering also energy supply, reliability and 7 costs, the role of renewable forms of energy, and 8 developments in federal law and regulations that may affect 9 any state actions, prior to making final decisions in 10 Illinois. 11 (c) Nothing in this Section is intended to or should be 12 interpreted in a manner to limit or restrict the authority of 13 the Illinois Environmental Protection Agency to propose, or 14 the Illinois Pollution Control Board to adopt, any 15 regulations applicable or that may become applicable to the 16 facilities covered by this Section that are required by 17 federal law. 18 (d) The Agency may file proposed rules with the Board to 19 effectuate its findings provided to the Senate Committee on 20 Environment and Energy and the House Committee on Environment 21 and Energy in accordance with subsection (b) of this Section. 22 Any such proposal shall not be submitted sooner than 90 days 23 after the issuance of the findings provided for in subsection 24 (b) of this Section. The Board shall take action on any such 25 proposal within one year of the Agency's filing of the 26 proposed rules. 27 (e) This Section shall apply only to those electrical 28 generating units that are subject to the provisions of 29 Subpart W of Part 217 of Title 35 of the Illinois 30 Administrative Code, as promulgated by the Illinois Pollution 31 Control Board on December 21, 2000. SB372 Enrolled -9- LRB9205013LBgc 1 Section 99. Effective date. This Act takes effect July 2 1, 2001.
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