Connecticut Seal

Substitute House Bill No. 5209

Public Act No. 02-64

AN ACT CONCERNING REDUCING SULFUR DIOXIDE EMISSIONS AT POWER PLANTS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective January 1, 2005) For purposes of this section, section 2 of this act and subsection (a) of section 16-245l of the general statutes, as amended by this act:

(1) "Affected unit" means any emissions unit subject to the provisions of the Post-2002 Nitrogen Oxides Budget Program, as described in the regulations adopted under section 22a-174 of the general statutes.

(2) "Average emissions rate" means a determination of the rate of SO2 emissions, measured in pounds of SO2 per MMBtu, in any calendar quarter from either a single affected unit or from two or more affected units. Average emissions rate for a single unit is calculated by dividing the total quarterly SO2 emissions, in pounds, from such unit by the total quarterly heat input, in MMBtu, for such unit. Average emissions rate for two or more units is calculated by dividing the total quarterly SO2 emissions, in pounds, from all such units by the total quarterly heat input, in MMBtu, for all such units.

(3) "Calendar quarter" means the period of January first to March thirty-first, inclusive, April first to June thirtieth, inclusive, July first to September thirtieth, inclusive, or October first to December thirty-first, inclusive.

(4) "MMBtu" means million BTU of heat input.

(5) "Sulfur dioxide" or "SO2" means a gas that at standard conditions has the molecular form SO2.

(6) "Sulfur Dioxide Discrete Emission Reduction Credit" or "SO2 DERC" means the reduction of one ton of sulfur dioxide at a stationary source during the generation period, which the commissioner has certified in writing as real, quantifiable, surplus, permanent and enforceable. Early reduction credits shall qualify as SO2 DERCs.

(7) "Early reduction credit" means a reduction of SO2 during calendar years 1999, 2000, 2001 or 2002 below the most stringent SO2 emission rate applicable to an affected unit.

(8) "Title IV SO2 allowance" or "SO2 allowance" means an authorization allocated to a Title IV source by the Administrator, pursuant to Title IV of the federal Clean Air Act, 42 USC 7651d et seq. and 40 CFR 72, 73, to emit up to one ton of SO2 during or after a specified calendar year.

(9) "Title IV source" means an affected unit that is also subject to Phase II of the acid rain control requirements set forth in Title IV of the federal Clean Air Act, 42 USC 7651d et seq.

Sec. 2. (NEW) (Effective January 1, 2005) (a) On and after January 1, 2005, the owner or operator of a Title IV source that is also an affected unit or units shall:

(1) Combust liquid fuel, gaseous fuel, solid fuel or a combination of each provided that each fuel possesses a fuel sulfur limit of equal to or less than 0. 3 per cent sulfur, by weight (dry basis); or

(2) Meet an average emission rate of equal to or less than 0. 33 pounds SO2 per MMBtu for each calendar quarter for an affected unit at the premises; or

(3) Meet an average emission rate of equal to or less than 0. 3 pounds SO2 per MMBtu calculated for each calendar quarter, if such owner or operator averages the emissions from two or more affected units at the premises.

(b) On and after January 1, 2005, no owner or operator of a Title IV source that is also an affected unit or units may use SO2 DERCs or SO2 allowances to comply with the requirements of subsection (a) of this section except if the Commissioner of Environmental Protection requires the owner or operator of an affected unit or units using a low-sulfur fuel to comply with subdivision (1) of subsection (a) of this section to offset excess SO2 emissions that were emitted during a suspension period, as described in subsection (c) of this section, through the purchase or retirement of such SO2 DERCs or SO2 allowances.

(c) The Commissioner of Environmental Protection may suspend the requirements of subdivision (1) of subsection (a) of this section for the owner or operator of any affected unit using a low-sulfur fuel, including a low-sulfur solid fuel. Such suspension shall be made only when the commissioner finds that the availability of fuel that complies with such requirements is inadequate to meet the needs of residential, commercial and industrial users in this state and that such inadequate supply constitutes an emergency, provided such suspension shall not exceed the period that the inadequate supply constitutes an emergency. Any such suspension by the commissioner shall not suspend or alter the sulfur dioxide average emission rate requirements that are in effect as of the date of passage of this act. The Commissioner of Environmental Protection shall specify in writing the period of time that such suspension shall be in effect and shall provide notice of such suspension to the joint standing committees of the General Assembly having cognizance of matters relating to the environment and energy and technology. No later than thirty days after the termination of such suspension, the owner or operator of an affected unit or units shall report to the commissioner, in writing, the amount of SO2 emissions in excess of those that would have occurred if the use of compliant fuel at such affected unit or units had not been interrupted. If such excess SO2 emissions from any premises exceed fifty tons, the commissioner shall require that the owner or operator of such affected unit or units offset such SO2 emissions through the purchase or retirement of SO2 DERCs or SO2 allowances.

(d) The provisions of subsections (c) and (f) of this section, when implemented by the Commissioner of Environmental Protection, shall not suspend any underlying procedures or requirements in the Regulations of Connecticut State Agencies adopted by the Department of Environmental Protection pertaining to SO2 emissions.

(e) No provision of section 1 of this act, this section or subsection (a) of section 16-245l of the general statutes, as amended by this act, shall be construed to prohibit the Commissioner of Environmental Protection from waiving or suspending any applicable sulfur dioxide emissions standard as may be allowed under current federal or state laws or regulations, or other permit limits of a must run Title IV source, as ordered by the Independent System Operator, as may be allowed under current federal or state laws or regulations. The commissioner may attach any conditions to such suspension or waiver, as the commissioner deems necessary to mitigate any adverse environmental or public health impacts.

(f) The Commissioner of Environmental Protection, in consultation with the chairman of the Public Utilities Control Authority, may suspend the prohibition of subsection (b) of this section for a Title IV source if it is determined that the application of the prohibition established under subsection (b) of this section adversely affects the ability to meet the reliability standards, as defined by the New England Power Pool or its successor organization, and the suspension thereof is intended to mitigate such reliability problems. The Commissioner of Environmental Protection, in consultation with the chairman of the Public Utilities Control Authority, shall specify in writing the reasons for such suspension and the period of time that such suspension shall be in effect and shall provide notice of such suspension at the time of issuance, or the next business day, to the joint standing committees of the General Assembly having cognizance of matters relating to the environment and energy and technology. No such waiver shall last more than thirty days. The commissioner may reissue additional waivers for such source after said initial waiver has expired. Within ten days of receipt of the commissioner's notice of suspension, the committees having cognizance of matters relating to the environment and energy and technology may hold a joint public hearing and meeting of the committees to either modify or reject the commissioner's suspension by a majority vote. If the committees do not meet, the commissioner's suspension shall be deemed approved.

Sec. 3. Subsection (a) of section 16-245l of the general statutes is repealed and the following is substituted in lieu thereof (Effective January 1, 2004):

(a) The Department of Public Utility Control shall establish and each electric distribution company shall collect a systems benefits charge to be imposed against all end use customers of each electric distribution company beginning January 1, 2000. The department shall hold a hearing that shall be conducted as a contested case in accordance with chapter 54 to establish the amount of the systems benefits charge. The department may revise the systems benefits charge or any element of said charge as the need arises. The systems benefits charge shall be used to fund (1) the expenses of the public education outreach program developed under subsection (a) of section 16-244d other than expenses for department staff, (2) the reasonable and proper expenses of the education outreach consultant pursuant to subsection (d) of section 16-244d, as amended, (3) the cost of hardship protection measures under sections 16-262c and 16-262d and other hardship protections, including but not limited to, electric service bill payment programs, funding and technical support for energy assistance, fuel bank and weatherization programs and weatherization services, (4) the payment program to offset tax losses described in section 12-94d, as amended, (5) any sums paid to a resource recovery authority pursuant to subsection (b) of section 16-243e, (6) low income conservation programs approved by the Department of Public Utility Control, (7) displaced worker protection costs, (8) unfunded storage and disposal costs for spent nuclear fuel generated before January 1, 2000, approved by the appropriate regulatory agencies, (9) postretirement safe shutdown and site protection costs that are incurred in preparation for decommissioning, (10) decommissioning fund contributions, and (11) legal, appraisal and purchase costs of a conservation or land use restriction and other related costs as the department in its discretion deems appropriate, incurred by a municipality on or before January 1, 2000, to ensure the environmental, recreational and scenic preservation of any reservoir located within this state created by a pump storage hydroelectric generating facility. As used in this subsection, "displaced worker protection costs" means the reasonable costs incurred, prior to January 1, [2006] 2008, by an electric supplier, exempt wholesale generator, electric company or a generation entity or affiliate arising from the dislocation of any employee other than an officer, provided such dislocation is a result of restructuring of (A) the electric generation market and such dislocation occurs on or after July 1, 1998, or (B) the closing of a Title IV source or an exempt wholesale generator, as defined in 15 USC 79z-5a, on or after January 1, 2004, as a result of such source's failure to meet requirements imposed as a result of sections 1 and 2 of this act and this section or those Regulations of Connecticut State Agencies adopted by the Department of Environmental Protection, as amended from time to time, in accordance with Executive Order Number 19, issued on May 17, 2000; and provided further such costs result from either the execution of agreements reached through collective bargaining for union employees or from the company's or entity's or affiliate's programs and policies for nonunion employees. "Displaced worker protection costs" includes costs incurred or projected for severance, retraining, early retirement, outplacement and related expenses. "Displaced worker protection costs" does not include those costs included in determining a tax credit pursuant to section 12-217bb.

Approved May 2, 2002