EPA to Follow SOx Trading with NOx Trading

The U.S. EPA on April 30 proposed an emissions-trading program for NOx that resembles a market-based program for reducing sulfur dioxide emissions. The proposal would allow 22 states and the District of Columbia NOx credit trading to meet and exceed standards.

The agency expects the program to reduce by 35 percent the nitrogen oxide pollution from "upwind" states that contribute to smog in the eastern half of the country. Called "cap and trade," it allows the designated areas to set caps for NOx emissions. At the same time it offers industries within the areas the opportunity to buy and sell market-based "credits" to reduce their NOx emissions. The EPA issued its latest proposal as part of a regional strategy for cost-effectively meeting its public-health standard for ozone, or smog.

The latest proposal would supplement a November agency proposal that called for nationwide NOx reductions. That proposal developed from recommendations of the 37-state Ozone Transport Assessment Group (OTAG).

The 22 states that could participate in the NOx emissions-trading program, along with Washington, DC, are Alabama, Connecticut, Delaware, Georgia, Illinois, Indiana, Kentucky, Massachusetts, Maryland, Michigan, Missouri, North Carolina, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Virginia, Wisconsin, and West Virginia. A 45-day comment period will follow its publication in the Federal Register. There will be a public hearing on May 29. Its location will appear in the Federal Register.