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91_SB1088ccr001
LRB9102840LDmbccr5
1 91ST GENERAL ASSEMBLY
2 FIRST CONFERENCE COMMITTEE REPORT
3 ON SENATE BILL 1088
4 -------------------------------------------------------------
5 -------------------------------------------------------------
6 To the President of the Senate and the Speaker of the
7 House of Representatives:
8 We, the conference committee appointed to consider the
9 differences between the houses in relation to House Amendment
10 No. 1 to Senate Bill 1088, recommend the following:
11 (1) that the House recede from House Amendment No. 1;
12 and
13 (2) that Senate Bill 1088 be amended by replacing the
14 title with the following:
15 "AN ACT to amend the Environmental Protection Act by
16 adding Section 9.9."; and
17 by replacing everything after the enacting clause with the
18 following:
19 "Section 5. The Environmental Protection Act is amended
20 by adding Section 9.9 as follows:
21 (415 ILCS 5/9.9 new)
22 Sec. 9.9. Nitrogen oxides trading system.
23 (a) The General Assembly finds:
24 (1) That USEPA has issued a Final Rule published in
25 the Federal Register on October 27, 1998, entitled
26 "Finding of Significant Contribution and Rulemaking for
27 Certain States in the Ozone Transport Assessment Group
28 Region for Purposes of Reducing Regional Transport of
29 Ozone", hereinafter referred to as the "NOx SIP Call",
30 compliance with which will require reducing emissions of
31 nitrogen oxides ("NOx");
32 (2) That reducing emissions of NOx in the State
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1 helps the State to meet the national ambient air quality
2 standard for ozone;
3 (3) That emissions trading is a cost-effective
4 means of obtaining reductions of NOx emissions.
5 (b) The Agency shall propose and the Board shall adopt
6 regulations to implement an interstate NOx trading program
7 (hereinafter referred to as the "NOx Trading Program") as
8 provided for in 40 CFR Part 96, including incorporation by
9 reference of appropriate provisions of 40 CFR Part 96 and
10 regulations to address 40 CFR Section 96.4(b), Section
11 96.55(c), Subpart E, and Subpart I. In addition, the Agency
12 shall propose and the Board shall adopt regulations to
13 implement NOx emission reduction programs for cement kilns
14 and stationary internal combustion engines.
15 (c) Allocations of NOx allowances to large electric
16 generating units ("EGUs") and large non-electric generating
17 units ("non-EGUs"), as defined by 40 CFR Part 96.4(a), shall
18 not exceed the State's trading budget for those source
19 categories to be included in the State Implementation Plan
20 for NOx.
21 (d) In adopting regulations to implement the NOx Trading
22 Program, the Board shall:
23 (1) assure that the economic impact and technical
24 feasibility of NOx emissions reductions under the NOx
25 Trading Program are considered relative to the
26 traditional regulatory control requirements in the State
27 for EGUs and non-EGUs;
28 (2) provide that emission units, as defined in
29 Section 39.5(1) of this Act, may opt into the NOx Trading
30 Program;
31 (3) provide for voluntary reductions of NOx
32 emissions from emission units, as defined in Section
33 39.5(1) of this Act, not otherwise included under
34 paragraph (c) or (d)(2) of this Section to provide
35 additional allowances to EGUs and non-EGUs to be
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1 allocated by the Agency. The regulations shall further
2 provide that such voluntary reductions are verifiable,
3 quantifiable, permanent, and federally enforceable;
4 (4) provide that the Agency allocate to non-EGUs
5 allowances that are designated in the rule, unless the
6 Agency has been directed to transfer the allocations to
7 another unit subject to the requirements of the NOx
8 Trading Program, and that upon shutdown of a non-EGU, the
9 unit may transfer or sell the NOx allowances that are
10 allocated to such unit; and
11 (5) provide that the Agency shall set aside
12 annually a number of allowances, not to exceed 5% of the
13 total EGU trading budget, to be made available to new
14 EGUs.
15 (A) Those EGUs that commence commercial
16 operation, as defined in 40 CFR Section 96.2, at a
17 time that is more than half way through the control
18 period in 2002 shall return to the Agency any
19 allowances that were issued to it by the Agency and
20 were not used for compliance in 2003.
21 (B) The Agency may charge EGUs that commence
22 commercial operation, as defined in 40 CFR Section
23 96.2, on or after January 1, 2003, for the
24 allowances it issues to them.
25 (e) The Agency may adopt procedural rules, as necessary,
26 to implement the regulations promulgated by the Board
27 pursuant to subsections (b) and (d) and to implement
28 subsection (i) of this Section.
29 (f) The regulations promulgated by the Board pursuant to
30 subsections (b) and (d) of this Section shall not be enforced
31 until the later of May 1, 2003, or the first day of the
32 control season subsequent to the calendar year in which all
33 of the other states subject to the provisions of the NOx SIP
34 Call that are located in USEPA Region V or that are
35 contiguous to Illinois have adopted regulations to implement
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1 NOx trading programs and other required reductions of NOx
2 emissions pursuant to the NOx SIP Call, and such regulations
3 have received final approval by USEPA as part of the
4 respective states' SIPS for ozone, or a final FIP for ozone
5 promulgated by USEPA is effective for such other states.
6 (g) To the extent that a court of competent jurisdiction
7 finds a provision of 40 CFR Part 96 invalid, the
8 corresponding Illinois provision shall be stayed until such
9 provision of 40 CFR Part 96 is found to be valid or is
10 re-promulgated. To the extent that USEPA or any court of
11 competent jurisdiction stays the applicability of any
12 provision of the NOx SIP Call to any person or circumstance
13 relating to Illinois, during the period of that stay, the
14 effectiveness of the corresponding Illinois provision shall
15 be stayed. To the extent that the invalidity of the
16 particular requirement or application does not affect other
17 provisions or applications of the NOx SIP Call pursuant to 40
18 CFR 51.121 or the NOx trading program pursuant to 40 CFR Part
19 96 or 40 CFR Part 97, this Section, and rules or regulations
20 promulgated hereunder, will be given effect without the
21 invalid provisions or applications.
22 (h) Notwithstanding any other provision of this Act, any
23 source or other authorized person that participates in the
24 NOx Trading Program shall be eligible to exchange NOx
25 allowances with other sources in accordance with this Section
26 and with regulations promulgated by the Board or the Agency.
27 (i) There is hereby created within the State Treasury an
28 interest-bearing special fund to be known as the NOx Trading
29 System Fund, which shall be used and administered by the
30 Agency for the purposes stated below:
31 (1) To accept funds from persons who purchase NOx
32 allowances from the Agency;
33 (2) To disburse the proceeds of the NOx allowances
34 sales pro-rata to the owners or operators of the EGUs
35 that received allowances from the Agency but not from the
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1 Agency's set-aside, in accordance with regulations that
2 may be promulgated by the Agency; and
3 (3) To finance the reasonable costs incurred by the
4 Agency in the administration of the NOx Trading System.
5 Section 95. The State Finance Act is amended by adding
6 Section 5.490 as follows:
7 (30 ILCS 105/5.490 new)
8 Sec. 5.490. The NOx Trading System Fund.
9 Section 99. Effective date. This Act takes effect upon
10 becoming law.".
11 Submitted on May 25, 1999.
12 s/Sen. Dave Sullivan s/Rep. Judy Erwin
13 s/Sen. William Mahar s/Rep. Phil Novak
14 s/Sen. John W. Maitland s/Rep. Barbara Flynn Currie
15 s/Sen. Evelyn M. Bowles s/Rep. Art Tenhouse
16 s/Sen. Dennis Jacob s/Rep. Dale A. Righter
17 Committee for the Senate Committee for the House