State of Illinois
92nd General Assembly

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 1        AN ACT concerning the environment.

 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 9.8 as follows:

 6        (415 ILCS 5/9.8)
 7        Sec. 9.8.  Emissions reductions market system.
 8        (a)  The General Assembly finds:
 9             (1)  That   achieving   compliance  with  the  ozone
10        attainment provisions of federal Clean Air Act Amendments
11        (CAAA) of 1990 calls for  innovative  and  cost-effective
12        implementation strategies.
13             (2)  That   economic   incentives  and  market-based
14        approaches can be used to achieve clean air compliance in
15        an innovative and cost-effective manner.
16             (3)  That development and operation of an  emissions
17        market  system  should  significantly lessen the economic
18        impacts associated with  implementation  of  the  federal
19        Clean  Air  Act  Amendments of 1990 and still achieve the
20        desired air quality for the area.
21        (b)  The Agency shall design an emissions  market  system
22    that  will  assist  the State in meeting applicable post-1996
23    provisions  under  the  CAAA   of   1990,   provide   maximum
24    flexibility for designated sources that reduce emissions, and
25    that  takes  into  account the findings of the national ozone
26    transport assessment, existing air  quality  conditions,  and
27    resultant  emissions  levels necessary to achieve or maintain
28    attainment.
29        (c)  The  Agency  may  develop  proposed  rules   for   a
30    market-based emissions reduction, banking, and trading system
31    that    will   enable   stationary   sources   to   implement
                            -2-                LRB9202503LBgc
 1    cost-effective, compliance options.   In  developing  such  a
 2    market  system,  the  Agency  may  take  into consideration a
 3    suitable ozone  control  season  and  related  reconciliation
 4    period,   seasonal   allotments   of   actual  emissions  and
 5    adjustments thereto, phased participation by size of  source,
 6    suitable  emissions  and compliance monitoring provisions, an
 7    annual allotment set-aside for market assurance, and suitable
 8    means for  the  market  system  to  be  provided  for  in  an
 9    appropriate State implementation plan.  The proposal shall be
10    filed  with  the Board and shall be subject to the rulemaking
11    provisions of Sections 27 and 28  of  this  Act.   The  rules
12    adopted by the Board shall include provisions that:
13             (1)  Assure   that   compliance  with  the  required
14        emissions reductions under the market system shall be, at
15        a  minimum,  as   cost-effective   as   the   traditional
16        regulatory control requirements in the State of Illinois.
17             (2)  Assure  that  emissions  reductions  under  the
18        market system will not be mandated unless it is necessary
19        for  the  attainment  and  maintenance  of  the  National
20        Ambient  Air  Quality  Standard  for ozone in the Chicago
21        nonattainment  area,  as  required  of  this   State   by
22        applicable federal law or regulation.
23             (3)  Assure that sources subject to the program will
24        not  be  required  to  reduce emissions to an extent that
25        exceeds their proportionate share of the  total  emission
26        reductions  required  of  all emission sources, including
27        mobile and area  sources,  to  attain  and  maintain  the
28        National  Ambient  Air  Quality Standard for ozone in the
29        Chicago nonattainment area.
30             (4)  Assure that credit is  given  or  exclusion  is
31        granted  for  those  emission  units  which  have reduced
32        emissions, either voluntarily or through the  application
33        of  maximum  available  control  technology  or  national
34        emissions  standards  for  hazardous air pollutants, such
                            -3-                LRB9202503LBgc
 1        that those reductions would be counted  as  if  they  had
 2        occurred  after  the initiation of the program. No permit
 3        limitations first imposed  since  January  1,  1994  upon
 4        bakery  facilities  (Standard  Industrial  Classification
 5        205)  in counties with a population of over 3,000,000 may
 6        be used in determining prereduction emission levels.
 7             (5)  Assure that  unusual  or  abnormal  operational
 8        patterns can be accounted for in the determination of any
 9        source's baseline from which reductions would be made.
10             (6)  Assure   that   relative  economic  impact  and
11        technical feasibility of emissions reductions  under  the
12        banking   and  trading  program,  as  compared  to  other
13        alternatives, is considered.
14             (7)  Assure that the feasibility  of  measuring  and
15        quantifying  emissions  is  considered  in developing and
16        adopting the banking and trading program.
17        (d)  Notwithstanding the other provisions  of  this  Act,
18    any source or other authorized person that participates in an
19    emissions   market  system  shall  be  eligible  to  exchange
20    allotment trading units  with  other  sources  provided  that
21    established rules are followed.
22        (e)  There is hereby created within the State Treasury an
23    interest-bearing  special fund to be known as the Alternative
24    Compliance Market Account  Fund,  which  shall  be  used  and
25    administered by the Agency for the following public purposes:
26             (1)  To  accept  and  retain  funds from persons who
27        purchase allotment trading units from the Agency pursuant
28        to regulatory provisions and  payments  of  interest  and
29        principal.
30             (2)  To purchase services, equipment, or commodities
31        that  help generate emissions reductions in or around the
32        ozone nonattainment area in Northeastern Illinois.
33    (Source: P.A. 89-173, eff. 7-19-95; 89-465, eff. 6-13-96.)
                            -4-                LRB9202503LBgc
 1        Section 99.  Effective date.  This Act takes effect  upon
 2    becoming law.

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