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92nd General Assembly

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Public Act 92-0279

SB372 Enrolled                                 LRB9205013LBgc

    AN ACT concerning environmental protection.

    Be it  enacted  by  the  People  of  the  State  of  Illinois,
represented in the General Assembly:

    Section 5.  The Environmental Protection Act  is  amended
by changing Section 9.9 and adding Section 9.10 as follows:

    (415 ILCS 5/9.9)
    Sec. 9.9.  Nitrogen oxides trading system.
    (a)  The General Assembly finds:
         (1)  That USEPA has issued a Final Rule published in
    the  Federal  Register  on  October  27,  1998,  entitled
    "Finding  of  Significant Contribution and Rulemaking for
    Certain States in the Ozone  Transport  Assessment  Group
    Region  for  Purposes  of  Reducing Regional Transport of
    Ozone", hereinafter referred to as the  "NOx  SIP  Call",
    compliance  with which will require reducing emissions of
    nitrogen oxides ("NOx");
         (2)  That reducing emissions of  NOx  in  the  State
    helps  the State to meet the national ambient air quality
    standard for ozone;
         (3)  That  emissions  trading  is  a  cost-effective
    means of obtaining reductions of NOx emissions.
    (b)  The Agency shall propose and the Board  shall  adopt
regulations  to  implement  an interstate NOx trading program
(hereinafter referred to as the  "NOx  Trading  Program")  as
provided  for  in  40 CFR Part 96, including incorporation by
reference of appropriate provisions of 40  CFR  Part  96  and
regulations  to  address  40  CFR  Section  96.4(b),  Section
96.55(c),  Subpart E, and Subpart I.  In addition, the Agency
shall propose  and  the  Board  shall  adopt  regulations  to
implement  NOx  emission  reduction programs for cement kilns
and stationary internal combustion engines.
    (c)  Allocations of  NOx  allowances  to  large  electric
generating  units  ("EGUs") and large non-electric generating
units ("non-EGUs"), as defined by 40 CFR Part 96.4(a),  shall
not  exceed  the  State's  trading  budget  for  those source
categories to be included in the  State  Implementation  Plan
for NOx.
    (d)  In adopting regulations to implement the NOx Trading
Program, the Board shall:
         (1)  assure  that  the economic impact and technical
    feasibility of NOx emissions  reductions  under  the  NOx
    Trading   Program   are   considered   relative   to  the
    traditional regulatory control requirements in the  State
    for EGUs and non-EGUs;
         (2)  provide  that  emission  units,  as  defined in
    Section 39.5(1) of this Act, may opt into the NOx Trading
    Program;
         (3)  provide  for  voluntary   reductions   of   NOx
    emissions  from  emission  units,  as  defined in Section
    39.5(1)  of  this  Act,  not  otherwise  included   under
    paragraph  (c)  or  (d)(2)  of  this  Section  to provide
    additional  allowances  to  EGUs  and  non-EGUs   to   be
    allocated  by  the Agency.  The regulations shall further
    provide that such voluntary  reductions  are  verifiable,
    quantifiable, permanent, and federally enforceable;
         (4)  provide  that  the  Agency allocate to non-EGUs
    allowances that are designated in the  rule,  unless  the
    Agency  has  been directed to transfer the allocations to
    another unit subject  to  the  requirements  of  the  NOx
    Trading Program, and that upon shutdown of a non-EGU, the
    unit  may  transfer  or  sell the NOx allowances that are
    allocated to such unit; and
         (5)  provide  that  the  Agency  shall   set   aside
    annually  a number of allowances, not to exceed 5% of the
    total EGU trading budget, to be  made  available  to  new
    EGUs.
              (A)  Those   EGUs   that   commence  commercial
         operation, as defined in 40 CFR Section 96.2,  at  a
         time  that is more than half way through the control
         period in 2003 2002 shall return to the  Agency  any
         allowances  that were issued to it by the Agency and
         were not used for compliance in 2004 2003.
              (B)  The Agency may charge EGUs  that  commence
         commercial  operation,  as defined in 40 CFR Section
         96.2,  on  or  after  January  1,  2003,   for   the
         allowances it issues to them.
    (e)  The Agency may adopt procedural rules, as necessary,
to   implement  the  regulations  promulgated  by  the  Board
pursuant  to  subsections  (b)  and  (d)  and  to   implement
subsection (i) of this Section.
    (f)  Notwithstanding any provisions in subparts T, U, and
W  of  Section 217 of Title 35 of the Illinois Administrative
Code  to  the  contrary,  compliance  with  the   regulations
promulgated  by the Board pursuant to subsections (b) and (d)
of this Section is required by May 31, 2004. The  regulations
promulgated  by the Board pursuant to subsections (b) and (d)
of this Section shall not be enforced until the later of  May
1, 2003, or the first day of the control season subsequent to
the calendar year in which all of the other states subject to
the  provisions of the NOx SIP Call that are located in USEPA
Region V or that are  contiguous  to  Illinois  have  adopted
regulations  to  implement  NOx  trading  programs  and other
required reductions of NOx emissions pursuant to the NOx  SIP
Call,  and  such  regulations have received final approval by
USEPA as part of the respective states' SIPS for ozone, or  a
final  FIP  for  ozone  promulgated by USEPA is effective for
such other states.
    (g)  To the extent that a court of competent jurisdiction
finds  a  provision  of  40  CFR   Part   96   invalid,   the
corresponding  Illinois  provision shall be stayed until such
provision of 40 CFR Part 96  is  found  to  be  valid  or  is
re-promulgated.  To  the  extent  that  USEPA or any court of
competent  jurisdiction  stays  the  applicability   of   any
provision  of  the NOx SIP Call to any person or circumstance
relating to Illinois, during the period  of  that  stay,  the
effectiveness  of  the corresponding Illinois provision shall
be  stayed.  To  the  extent  that  the  invalidity  of   the
particular  requirement  or application does not affect other
provisions or applications of the NOx SIP Call pursuant to 40
CFR 51.121 or the NOx trading program pursuant to 40 CFR Part
96 or 40 CFR Part 97, this Section, and rules or  regulations
promulgated  hereunder,  will  be  given  effect  without the
invalid provisions or applications.
    (h)  Notwithstanding any other provision of this Act, any
source or other authorized person that  participates  in  the
NOx  Trading  Program  shall  be  eligible  to  exchange  NOx
allowances with other sources in accordance with this Section
and with regulations promulgated by the Board or the Agency.
    (i)  There is hereby created within the State Treasury an
interest-bearing  special fund to be known as the NOx Trading
System Fund, which shall be  used  and  administered  by  the
Agency for the purposes stated below:
         (1)  To  accept  funds from persons who purchase NOx
    allowances from the Agency;
         (2)  To disburse the proceeds of the NOx  allowances
    sales  pro-rata  to  the  owners or operators of the EGUs
    that received allowances from the Agency but not from the
    Agency's set-aside, in accordance with  regulations  that
    may be promulgated by the Agency; and
         (3)  To finance the reasonable costs incurred by the
    Agency in the administration of the NOx Trading System.
(Source: P.A. 91-631, eff. 8-19-99.)
    (415 ILCS 5/9.10 new)
    Sec. 9.10.  Fossil fuel-fired electric generating plants.
    (a)  The General Assembly finds and declares that:
         (1)  fossil  fuel-fired  electric  generating plants
    are a significant source of air emissions in  this  State
    and have become the subject of a number of important  new
    studies of their effects on the public health;
         (2)  existing state and federal policies, that allow
    older  plants  that  meet  federal  standards  to operate
    without   meeting   the   more   stringent   requirements
    applicable to new plants, are  being  questioned  on  the
    basis  of  their  environmental  impacts and the economic
    distortions such policies cause in a  deregulated  energy
    market;
         (3)  fossil  fuel-fired  electric  generating plants
    are, or may  be,  affected  by  a  number  of  regulatory
    programs,  some  of which are under review or development
    on the state and national levels, and to a certain extent
    the international level, including the federal acid  rain
    program,  tropospheric ozone, mercury and other hazardous
    pollutant control requirements, regional haze, and global
    warming;
         (4)  scientific  uncertainty regarding the formation
    of certain  components  of  regional  haze  and  the  air
    quality modeling that predict impacts of control measures
    requires  careful  consideration  of  the  timing  of the
    control of some of the pollutants from these  facilities,
    particularly sulfur dioxides  and  nitrogen  oxides  that
    each  interact  with  ammonia and other substances in the
    atmosphere;
         (5)  the development of energy policies to promote a
    safe, sufficient,  reliable, and affordable energy supply
    on the state and national levels is being affected by the
    on-going deregulation of the  power  generation  industry
    and the evolving energy markets;
         (6)  the Governor's formation of an  Energy  Cabinet
    and  the  development  of a State energy policy calls for
    actions by the Agency and the Board that are  in  harmony
    with  the  energy  needs  and  policy of the State, while
    protecting the public health and the environment;
         (7)  Illinois coal is an abundant  resource  and  an
    important component of Illinois' economy whose use should
    be  encouraged to the greatest extent possible consistent
    with protecting the public health and the environment;
         (8)  renewable forms of energy should be promoted as
    an important element  of  the  energy  and  environmental
    policies  of the State and that it is a goal of the State
    that at least 5% of the State's energy production and use
    be derived from renewable forms of energy by 2010 and  at
    least 15% from renewable forms of energy by 2020;
         (9)  efforts  on  the  state  and federal levels are
    underway   to   consider   the   multiple   environmental
    regulations affecting electric generating plants in order
    to improve the ability of  government  and  the  affected
    industry  to engage in effective planning through the use
    of multi-pollutant strategies; and
         (10)  these  issues,  taken  together,  call  for  a
    comprehensive review of the impact of these facilities on
    the public health, considering also  the  energy  supply,
    reliability,  and  costs,  the role of renewable forms of
    energy,  and  the  developments  in   federal   law   and
    regulations  that  may affect any state actions, prior to
    making final decisions in Illinois.
    (b)  Taking into account the findings and declarations of
the General Assembly contained  in  subsection  (a)  of  this
Section, the Agency shall, before September 30, 2004, but not
before  September  30,  2003,  issue  to the House and Senate
Committees on Environment and Energy  findings  that  address
the  potential need for the control or reduction of emissions
from fossil fuel-fired electric generating plants,  including
the following provisions:
         (1)  reduction   of  nitrogen  oxide  emissions,  as
    appropriate,  with  consideration   of   maximum   annual
    emissions  rate  limits  or establishment of an emissions
    trading   program   and   with   consideration   of   the
    developments in federal  law  and  regulations  that  may
    affect  any State action, prior to making final decisions
    in Illinois;
         (2)  reduction  of  sulfur  dioxide  emissions,   as
    appropriate,   with   consideration   of  maximum  annual
    emissions rate limits or establishment  of  an  emissions
    trading   program   and   with   consideration   of   the
    developments  in  federal  law  and  regulations that may
    affect any State action, prior to making final  decisions
    in Illinois;
         (3)  incentives  to  promote  renewable  sources  of
    energy  consistent  with    item (8) of subsection (a) of
    this Section;
         (4)  reduction   of    mercury    as    appropriate,
    consideration of  the availability of control technology,
    industry practice requirements, or incentive programs, or
    some  combination of these approaches that are sufficient
    to prevent unacceptable  local  impacts  from  individual
    facilities  and with consideration of the developments in
    federal law and regulations that  may  affect  any  state
    action, prior to making final decisions in Illinois; and
         (5)  establishment  of  a banking system, consistent
    with the United States Department of  Energy's  voluntary
    reporting  system,  for  certifying credits for voluntary
    offsets of emissions of greenhouse gases,  as  identified
    by  the United States Environmental Protection Agency, or
    other voluntary reductions  of  greenhouse  gases.   Such
    reduction  efforts  may  include, but are not limited to,
    carbon sequestration, technology-based control  measures,
    energy  efficiency  measures,  and  the  use of renewable
    energy sources.
    The Agency  shall  consider  the  impact  on  the  public
health,  considering  also    energy  supply, reliability and
costs,  the  role  of  renewable   forms   of   energy,   and
developments  in  federal law and regulations that may affect
any  state  actions,  prior  to  making  final  decisions  in
Illinois.
    (c)  Nothing in this Section is intended to or should  be
interpreted in a manner to limit or restrict the authority of
the  Illinois Environmental Protection Agency to  propose, or
the  Illinois  Pollution  Control   Board   to   adopt,   any
regulations  applicable  or that may become applicable to the
facilities covered by  this  Section  that  are  required  by
federal law.
    (d)  The Agency may file proposed rules with the Board to
effectuate  its  findings provided to the Senate Committee on
Environment and Energy and the House Committee on Environment
and Energy in accordance with subsection (b) of this Section.
Any such proposal shall not be submitted sooner than 90  days
after the issuance of the findings provided for in subsection
(b) of this Section.  The Board shall take action on any such
proposal  within  one  year  of  the  Agency's  filing of the
proposed rules.
    (e)  This Section shall apply only  to  those  electrical
generating  units  that  are  subject  to  the  provisions of
Subpart  W  of  Part  217  of  Title  35  of   the   Illinois
Administrative Code, as promulgated by the Illinois Pollution
Control Board on December 21, 2000.
    Section  99.  Effective date.  This Act takes effect July
1, 2001.
    Passed in the General Assembly May 31, 2001.
    Approved August 07, 2001.

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