| (a) Methods of generation.
(1) Mobile emission reduction credits (MERC) may be
generated by any mobile source emission reduction strategy that creates
actual mobile source emission reductions under these rules and subject
to the approval of the executive director.
(2) MERCs may not be generated from the following strategies:
(A) that portion of reductions funded through a state
or federal program, unless specifically allowed under that program;
(B) through the transfer of emissions from one mobile
source to another mobile source within the same nonattainment area
and under common ownership or control;
(C) reduction strategies resulting in secondary emissions
increases that exceed limits established under state or federal rules
or regulations; or
(D) the shutdown or replacement of a mobile source
unless that source is rendered permanently inoperable or permanently
removed from North America.
(b) MERC baseline emissions.
(1) Mobile source baseline emissions shall be calculated
with either measured emissions of an appropriately sized sample of
the participating mobile sources using a United States Environmental
Protection Agency (EPA)-approved test procedure, or by estimating
emissions of the participating mobile sources using the most recent
edition of the EPA on-road or non-road mobile emissions factor models
or other model as applicable.
(2) The historical adjusted emissions and state implementation
plan emissions may only include actual emissions that occurred when
the mobile source was operating inside a specific nonattainment area.
(3) The activity and emissions rate data used to calculate
the mobile source's historical adjusted emissions must be determined
from two consecutive calendar years from the five consecutive years
immediately before the emissions reduction is achieved unless detailed
operational records are available for more than five years. If these
detailed operational records are available and do not demonstrate
decreasing use due to vehicle age or inoperability, the historical
adjusted emissions for a mobile source may be determined from two
consecutive calendar years up to six to ten consecutive years immediately
before the emissions reduction is achieved.
(4) For a mobile source in existence less than 24 months
or not having two complete calendar years of activity data, a shorter
period of not less than 12 months may be approved by the executive
director.
(5) Baseline emissions for quantifying MERCs should
include, but not be limited to, the following information and data
as appropriate:
(A) the emission standard to which the mobile source
is subject or the emission performance standard to which the mobile
source is certified;
(B) the estimated or measured in-use emissions levels
per unit of use from all significant mobile source emissions sources;
(C) the number of mobile sources in the participating
group;
(D) the type or types of mobile sources by model year;
(E) the actual or projected activity level, hours of
operation, or miles traveled, by type and model year; and
(F) the projected remaining useful life of the participating
group of mobile sources.
(c) MERC calculation. The quantity of MERCs must be
calculated from the difference between the mobile source baseline
emissions and the strategic emissions. The strategic emissions must
be based on the best estimate of the actual in-use emissions of the
modified or substitute on-road or non-road vehicles or transportation
system that will occur when the mobile source is operating inside
a specific nonattainment area. Any estimate of a strategic emissions
level based on an assumption of reduced consumer service or transportation
service would not be allowed without the support of a convincing analytical
justification of the assumption.
(1) For mobile sources generating credits from a shutdown,
the amount of MERCs generated will be reduced by 15% or 0.1 ton per
year, whichever is greater.
(2) The amount of MERCs generated will be adjusted
to account for the quality of the data used to quantify the emissions.
The reduction will be 15% or 0.1 ton per year, whichever is greater,
for records supporting alternative methods approved according to §101.302(e)(1)(E)
of this title (relating to General Provisions).
(3) If the mobile source is subject to an adjustment
based on both the reduction strategy being a shutdown and the quality
of the data used to quantify the emissions, the total combined reduction
to the amount of MERCs generated will be 20% or 0.1 ton per year,
whichever is greater.
(d) Emission offsets. Mobile source reduction strategies
that reduce emissions in one criteria pollutant or precursor for which
an area is designated nonattainment, yet result in an emissions increase
of another criteria pollutant or precursor for which that same area
is nonattainment and from the same mobile source, must be required
to offset the resulting increase at a 1:1 ratio with ERCs or MERCs.
(e) MERC certification.
(1) The generator of the reduction from a mobile source
with potential MERCs shall submit an application form specified by
the executive director and signed by an authorized account representative.
(A) Applications will be reviewed to determine the
credibility of the reductions. Reductions determined to be creditable
will be certified by the executive director and a MERC will be issued
to the owner of the mobile source except as specified in §101.302(n)
of this title.
(B) The application for MERCs must be submitted no
more than two years after the date of the emissions reduction, except
as provided by subparagraph (C) of this paragraph.
(C) For a mobile source, the application for MERCs
may be submitted as follows.
(i) For emission reductions that occurred after June
1, 2013 and prior to January 1, 2015, the application for MERCs must
be submitted by December 31, 2017.
(ii) For emissions reductions that occurred between
January 1, 2015 and January 1, 2017, the application for MERCs may
be submitted up to three years after the date of the emissions reduction.
(iii) The application deadline exceptions specified
in clauses (i) and (ii) of this subparagraph no longer apply after
December 31, 2019.
(iv) Emission credits certified under the application
deadline exceptions specified in clauses (i) and (ii) of this subparagraph
or certified for mobile source emission reductions occurring before
and included on an application submitted, but not acted on, before
January 1, 2017 shall be available for use for 72 months from the
date of the emission reduction in lieu of the provisions outlined
in §101.309(b)(2) of this title (relating to Emission Credit
Banking and Trading).
(2) MERCs will be determined and certified in accordance
with §101.302(e) of this title using:
(A) EPA methodologies, when available;
(B) actual monitoring results, when available;
(C) calculations using the most current EPA mobile
emissions factor model or other model as applicable; or
(D) calculations using creditable emission reduction
measurement or estimation methodologies that satisfactorily address
the analytical uncertainties of mobile source emissions reduction
strategies.
(3) The expected remaining useful life of the mobile
source shall be determined based on the assumptions used in the models
in the applicable state implementation plan (SIP) revision or on a
case-by-case basis approved by the executive director when a type
of mobile source is not reflected in these models. Except as provided
in paragraph (4) of this subsection, the amount of MERCs certified
for a given emissions reduction will be determined by the emissions
reduction for the expected remaining useful life of the mobile source(s),
annualized over 25 years.
(4) The requirement to consider the expected remaining
useful life of the mobile source and to annualize the emissions reduction
over 25 years, as described in paragraph (3) of this subsection, does
not apply if a capture and control system is used to reduce mobile
source emissions. Instead, the MERC calculation will include the following.
(A) The strategic emissions used in the MERC calculation
must include the mobile source emissions that are not captured by
the capture and control system. In addition, the strategic emissions
must also include any emissions that are not controlled by the system
after capture and any emissions caused by or as a result of operating
the system.
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