(a) An owner or operator may achieve compliance with the nitrogen oxides (NOX ) emission specifications of §117.3010 of this title (relating to Emission Specifications) by achieving equivalent NOX emission reductions obtained by compliance with a system cap emission limitation in accordance with the requirements of this section.
(b) Each unit within an electric power generating system, as defined in §117.10 of this title (relating to Definitions), that would otherwise be subject to the NOX emission specifications of §117.3010 of this title must be included in the system cap.
(c) The annual average emission cap must be calculated using the following equation.
Attached Graphic
(d) The NOX emissions monitoring required by §117.3040 of this title (relating to Continuous Demonstration of Compliance) for each unit in the system cap must be used to demonstrate continuous compliance with the system cap.
(e) For each operating unit, the owner or operator shall use one of the following methods to provide substitute emissions compliance data during periods when the NOX monitor is off-line:
  (1) if the NOX monitor is a continuous emissions monitoring system (CEMS):
    (A) subject to 40 Code of Federal Regulations (CFR) Part 75, use the missing data procedures specified in 40 CFR Part 75, Subpart D (Missing Data Substitution Procedures); or
    (B) subject to 40 CFR Part 75, Appendix E, use the missing data procedures specified in 40 CFR Part 75, Appendix E, §2.5 (Missing Data Procedures);
  (2) use Appendix E monitoring in accordance with §117.3040(e) of this title;
  (3) if the NOX monitor is a predictive emissions monitoring system (PEMS):
    (A) use the methods specified in 40 CFR Part 75, Subpart D; or
    (B) use calculations in accordance with §117.8110(b) of this title (relating to Emission Monitoring System Requirements for Utility Electric Generation Sources); or
  (4) use the maximum emission rate as measured by the testing conducted in accordance with §117.3035(d) of this title (relating to Initial Demonstration of Compliance).
(f) The owner or operator of any unit subject to a system cap shall maintain daily records indicating the NOX emissions and fuel usage from each unit and summations of total NOX emissions and fuel usage for all units under the system cap on a daily basis. Records must also be retained in accordance with §117.3045 of this title (relating to Notification, Recordkeeping, and Reporting Requirements).
(g) The owner or operator of any unit subject to a system cap shall submit annual reports for the monitoring systems in accordance with §117.3045 of this title. The owner or operator shall also report any exceedance of the system cap emission limit in the annual report and shall include an analysis of the cause for the exceedance with appropriate data to demonstrate the amount of emissions in excess of the applicable limit and the necessary corrective actions taken by the company to assure future compliance.
(h) The owner or operator of any unit subject to a system cap shall demonstrate initial compliance with the system cap in accordance with the schedule specified in §117.9300 of this title (relating to Compliance Schedule for Utility Electric Generation in East and Central Texas).
(i) A unit that is permanently retired or decommissioned and rendered inoperable may be included in the system cap emission limit, provided that the permanent shutdown occurred on or after January 1, 1999. The system cap emission limit is calculated in accordance with subsection (b) of this section.
(j) Emission reductions from shutdowns or curtailments that have been used for netting or offset purposes under the requirements of Chapter 116 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification) may not be included in the baseline for establishing the cap.
(k) For the purposes of determining compliance with the system cap emission limit, the contribution of each affected unit that is operating during a startup, shutdown, or emissions event as defined in §101.1 of this title (relating to Definitions) must be calculated from the NOX emission rate measured by the NOX monitor, if operating properly. If the NOX monitor is not operating properly, the substitute data procedures identified in subsection (e) of this section must be used. If neither the NO X monitor nor the substitute data procedure are operating properly, the owner or operator shall use the maximum daily rate measured during the initial demonstration of compliance, unless the owner or operator provides data demonstrating to the satisfaction of the executive director and United States Environmental Protection Agency that actual emissions were less than maximum emissions during such periods.
(l) An owner or operator of a source of NOX in any of the east and central Texas attainment counties listed in §117.3000(a)(4) of this title (relating to Applicability) who is participating in the system cap under this section (relating to System Cap) may exceed their system cap provided that the owner or operator is complying with the requirements of Chapter 101, Subchapter H, Division 1 or 4 of this title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking and Trading).

Source Note: The provisions of this §117.3020 adopted to be effective June 14, 2007, 32 TexReg 3206; amended to be effective April 19, 2012, 37 TexReg 2655