Section NR 408.06 - Emissions offsets(1) To be eligible for use under this chapter, emissions offsets shall meet all of the following criteria: (a) Except as provided in par. (cm), offsets shall be of the same air contaminant class, that is, volatile organic compounds, particulate matter, carbon monoxide, nitrogen oxides, sulfur dioxide, or lead.(b) Offsets for particulate matter, carbon monoxide, nitrogen oxides, sulfur dioxide and lead shall be in a time frame compatible with the applicable air quality standard.(c) Offsets for volatile organic compounds and nitrogen oxides, where applicable, shall be quantified on an annual basis. In addition, the source shall submit emission estimates in a time frame consistent with the air quality standard for ozone. Note: The time frame for the air quality standard for each pollutant is given in s. NR 404.04.
(cm) PM2.5 emission increases may be offset by decreases in nitrogen oxides or sulfur dioxide emissions, that are otherwise creditable, at a ratio of 40 tpy of sulfur dioxide for each ton of direct PM2.5 emissions and 200 tpy of nitrogen oxides for each ton of direct PM2.5 emissions.(d) Offsets shall result in a net air quality benefit. Note: The term "net air quality benefit" will be interpreted based on EPA's December 4, 1986 Emission Trading Policy Statement, incorporated by reference in s. NR 484.06, until revised by EPA or until the term is defined by the department.
(e) The emission reductions used as offsets shall be generated after the date used as a baseline or shall be included in the baseline for the portion of the latest state implementation plan which relates to the nonattainment status of the area. Emission reductions occurring before August 7, 1977 may not be used as offsets.(f) The assumptions used to calculate the offset shall be consistent with the assumptions used to develop the area's implementation plan.(g) Offsets shall be surplus, permanent, quantifiable and federally enforceable at the time of their use.(2) Prior to the issuance of a permit under this chapter, federally enforceable emissions offsets shall be obtained from the same source or other sources in the same nonattainment area, except that the emissions offsets may be obtained from a source in another nonattainment area if both of the following apply: (a) The other area has an equal or higher nonattainment classification than the area in which the source is located.(b) Emissions from the other area contribute to a violation of a national ambient air quality standard in the nonattainment area in which the proposed new or modified source would be constructed.(3) The total annual tonnage of emissions of any applicable air contaminant allowed from the proposed new source, or net emissions increase from the modification, shall be offset by an equal or greater reduction, as applicable, in the actual emissions of the air contaminant from the same or other sources.(4) In meeting the requirements of sub. (3) for ozone nonattainment areas classified under section 182 of the Act (42 USC 7511 a), the ratio of total actual emission reductions of VOCs, and nitrogen oxides where applicable, to the net emissions increase for the same air contaminant class shall be as follows: (a) In any rural transport or marginal nonattainment area for ozone: at least 1.1 to 1.(b) In any moderate nonattainment area for ozone: at least 1.15 to 1.(c) In any serious nonattainment area for ozone: at least 1.2 to 1.(d) In any severe nonattainment area for ozone: at least 1.3 to 1.(e) In any extreme nonattainment area for ozone: at least 1.5 to 1.(5) Within an ozone transport region, for any area designated as ozone attainment, unclassifiable, or rural transport or marginal nonattainment, the ratio of total actual emissions reductions of VOCs, and nitrogen oxides where applicable, to the net emissions increase for the same air contaminant class shall be at least 1.15 to 1.(6) A major modification which has a significant net emissions increase of VOCs, or nitrogen oxides where applicable, which is located in an extreme nonattainment area for ozone will be considered to comply with the offset requirements under s. NR 408.05 if the owner or operator of the source elects to offset the proposed emissions increase of VOCs, and nitrogen oxides where applicable, by a greater reduction in actual emissions from other discrete operations, units or pollutant emitting activities within the source at an internal offset ratio at least 1.3 to 1.(7)(a) Emissions reductions achieved by shutting down an existing source or curtailing production or operating hours below baseline levels may be generally credited if: 1. The reductions are surplus, permanent, quantifiable and federally enforceable.2. The area has a U.S. environmental protection agency approved state implementation plan, except as provided in par. (b).3. The source notifies the department in writing prior to the date the shut down or curtailment occurs. The notification shall include documentation of the type and quantity of emission reduction credit to be generated.4. The shutdown or curtailment occurs on or after the date specified for this purpose in the state implementation plan, and if the date specified is on or after the date of the most recent emissions inventory used in the plan's demonstration of attainment. The department may consider a prior shutdown or curtailment to have occurred after the date of its most recent emissions inventory, if the inventory explicitly includes as current existing emissions the emissions from the previously shut down or curtailed sources. However, no credit is available for shutdowns which occurred prior to August 7, 1977.(b) The emission reductions described in par. (a) may be credited in the absence of a U.S. environmental protection agency approved state implementation plan only if the shutdown or curtailment occurs on or after the date the construction permit application is filed or if the applicant can establish that the proposed new source is a replacement for the shut down or curtailed source, and the cutoff date provisions of par. (a) 4. are observed.(8) No emissions reduction credit may be allowed for reductions in any organic compound specifically excluded from the definition of "VOC" in s. NR 400.02(162).(9) Credit for an emissions reduction may be claimed to the extent that the department has not relied on it in issuing any permit under ch. NR 405, 406, 407 or this chapter or the state has not relied on it in demonstrating attainment or reasonable further progress. Incidental emissions reductions which are not otherwise required under the Act or chs. NR 400 to 499 may be creditable as emissions reductions for such purposes if the emissions reductions meet the applicable requirements of subs. (1) and (2).(10) The total increase in emissions, in tons per year, resulting from a major modification that must be offset in accordance with this section shall be determined by summing the difference between the allowable emissions after the modification and the actual emissions before the modification for each emissions unit.Wis. Admin. Code Department of Natural Resources NR 408.06
Cr. Register, May, 1993, No. 449, eff. 6-1-93; am. (4) (intro.), (a), (5), Register, December, 1996, No. 492, eff. 1-1-97; am. (2) (intro.), (a) and (8), Register, October, 1999, No. 526, eff. 11-1-99; CR 03-118: cr. (10) Register June 2007 No. 618, eff. 7-1-07; CR 10-050: cr. (1) (cm) Register November 2010 No. 659, eff. 12-1-10; CR 13-070: am. (1) (a) Register July 2014 No. 703, eff. 8-1-14.