(a) The executive director shall deposit allowances into a compliance account as follows.      
        (1) For a site located in Harris County, allowances will be determined using the following equation:        
          Attached Graphic         
        (2) For a site in Harris County not in operation or with HRVOC emissions that are not representative of permitted normal routine operation due to an authorized modification that resulted in an HRVOC emission reduction during the baseline emissions period, the owner or operator may request from the executive director the use of any allowance stream acquired from facilities previously participating in the HRVOC Emissions Cap and Trade program in lieu of reallocation until the alternate baseline emissions are established for the site, according to the following:                  (A) this allowance stream is less than the HRVOC permit allowable limit in effect at the time the facility commences operation;                   (B) the baseline emissions period for any site under this paragraph will be any consecutive 24 months from 2010 - 2012; and                   (C) beginning with the 2014 control period, all sites will receive an allocation in accordance with the methodology under paragraph (1) of this subsection.         
        (3) A site meeting the following conditions may request to use an alternative baseline emissions period consisting of the two consecutive calendar-year control periods immediately preceding the baseline emissions period defined under §101.390 of this title (relating to Definitions):                  (A) the site used continuous flow rate monitoring and speciation of HRVOC to determine HRVOC emissions during the alternative baseline period;                   (B) the site had permanent, voluntary, and quantifiable HRVOC emission reductions in an amount equal to or greater than 25 tons resulting in a site-wide reduction in HRVOC emissions of at least 25% as calculated by comparing the average HRVOC emissions from the alternate baseline period to the baseline emissions period defined under §101.390 of this title;                   (C) qualifying HRVOC emission reductions must have been made enforceable by a permit application submitted under Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification) or other submittal to the executive director no later than April 1, 2010; and                   (D) a request for an alternative baseline period must be received by the executive director no later than July 1, 2010.         
        (4) For a site located in Brazoria, Chambers, Fort Bend, Galveston, Liberty, Montgomery, and Waller Counties, allowances will be determined using the following equation.        
          Attached Graphic         
        (5) Uncontrolled emissions for affected facility types for use in determining site allocations under paragraph (1) of this subsection must be calculated as follows.                  (A) For flares, the uncontrolled emissions are equal to actual average HRVOC emissions from routine normal operation during the baseline emissions period for that facility divided by one minus the average percent control efficiency specifications for flares in §115.725(d) of this title (relating to Monitoring and Testing Requirements).                   (B) For heaters, boilers, furnaces, thermal and catalytic oxidizers, and other combustion control devices combusting HRVOC streams, the uncontrolled emissions must be calculated by dividing actual average emissions from routine normal operation during the baseline emissions period for each facility by one minus 99%, or by one minus the actual monitored HRVOC control efficiency for the facility, not to exceed 99.9%, if that facility has demonstrated the actual monitored HRVOC control efficiency through stack performance testing.                   (C) For any other facility without a demonstrated combustion control efficiency, the control efficiency is equal to zero; therefore, the uncontrolled emissions will be equal to the actual HRVOC emissions from routine normal operation.                   (D) For a site that employs a flare or vent gas recovery or flare minimization control strategy that is not requesting the use of an alternative baseline emissions period under paragraph (3) of this subsection, the owner or operator may request to include the amount of any quantifiable reduction in actual HRVOC emissions attributable to the use of flare or vent gas recovery as uncontrolled emissions, subject to approval by the executive director. The amount of quantified reductions is equal to the difference of the average actual HRVOC emissions from routine normal operation during a consecutive 12-month period before the 2006 - 2009 baseline emissions period and the implementation of the HRVOC gas recovery or flare minimization control strategy and the enforceable allowable HRVOC permit limit for the affected facility after the recovery-based emissions reduction strategy implementation. The average actual HRVOC emissions used for quantifying the reductions under this subparagraph must be determined through continuous flow rate monitoring and HRVOC speciation testing. This allowable emissions limit must be made enforceable through a permit application submitted under Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification) to the executive director no later than April 1, 2010. Credit allocated for reductions due to flare or vent gas recovery cannot also be creditable if the HRVOC stream is sent to another control device. The creditable emissions from flare gas recovery calculated in this subparagraph are then converted to uncontrolled emissions through the use of the average control efficiency specifications under §115.725(d) of this title.                   (E) For a site that has purchased HRVOC allowance streams, uncontrolled emissions must be the greater of the uncontrolled emissions calculated under subparagraphs (A) - (C) of this paragraph, or the sum of the original existing HRVOC allowance allocated according to the previous allocation methodology and the amount of the allowance stream in tons. If a site's actual two-high year emissions is less than the sum of its original existing HRVOC allowance and the amount of the allowance stream in tons, the owner or operator shall add the difference to the uncontrolled emissions as actual emissions.         
      (b) The level of activity of a site will be determined by summing the levels of activity from the chosen 12 consecutive month period for each process unit, as defined in §115.10 of this title (relating to Definitions), located at the site that produce one or more HRVOCs as an intermediate, by-product, or final product or that use one or more HRVOCs as a raw material or intermediate to produce a product.     
      (c) A site in Harris County subject to the requirements of this division that receives an HRVOC allocation of less than 5.0 tons will be eligible to receive a minimum allocation of 5.0 tons of HRVOC allowances per year. A site subject to the requirements of this division that receives an HRVOC allocation of greater than or equal to 5.0 tons but less than 10.0 tons will be eligible to receive a minimum allocation of 10.0 tons of HRVOC allowances per year. This provision does not apply if the site's allocation falls below a minimum allocation only because of a transfer of part or all of the site's allocation.     
      (d) The executive director will deposit allowances into each compliance account by January 1 of each year.     
      (e) The executive director may adjust the deposits for any control period to reflect new or existing state implementation plan requirements.     
      (f) The executive director may add or deduct allowances from compliance accounts based on the review of reports required under §101.400 of this title (relating to Reporting).     
     Source Note:        The provisions of this §101.394 adopted to be effective December 23, 2004, 29 TexReg 11592; amended to be effective April 1, 2010, 35 TexReg 2556; amended to be effective June 25, 2015, 40 TexReg 3848