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   "(d) Coal-fired Units  Below 1.20 lbs/mmBtu.-(1) After  January 1,

2000,  it shall be unlawful  for any existing  coal-fired utility unit

the  lesser of whose actual or allowable 1985 sulfur dioxide emissions

rate is less  than 0.60 lbs/mmBtu to  exceed an annual  sulfur dioxide

tonnage  emission  limitation  equal  to  the  product of  the  unit's

baseline multiplied by (A) the lesser of  0.60 lbs/mmBtu or the unit's

allowable  1985  emissions rate,  and (B)  a  numerical factor  of 120

percent, divided by  2,000, unless the owner or  operator of such unit

holds  allowances  to  emit not  less  than  the  unit's total  annual

emissions.

   "(2) After January 1, 2000, it shall be  unlawful for any existing

coal-fired utility unit the  lesser of whose actual or  allowable 1985

sulfur  dioxide  emissions rate  is equal  to,  or greater  than, 0.60

lbs/mmBtu  and less  than 1.20  lbs/mmBtu to  exceed an  annual sulfur

dioxide  tonnage  emissions limitation  equal  to the  product  of the

unit's  baseline multiplied  by  (A) the  lesser  of its  actual  1985

emissions  rate  or  its allowable  1985  emissions  rate,  and (B)  a

numerical factor of 120 percent, divided by 2,000, unless the owner or

operator  of such  unit holds  allowances  to emit  not less  than the

unit's total annual emissions.

   "(3)(A) In addition to allowances allocated  pursuant to paragraph

(1)  and section 403(a)(1) as basic Phase II allowance allocations, at

the  election  of  the  designated  representative  of  the  operating

company,  beginning  January  1,  2000,  and  for  each  calendar year

thereafter until and including  2009, the Administrator shall allocate

annually   for  each   unit  subject   to  the   emissions  limitation

requirements  of paragraph  (1)  allowances from  the reserve  created

pursuant to subsection  (a)(2) in  an amount  equal to  the amount  by

which (i)  the product of the  lesser of 0.60 lbs/mmBtu  or the unit's

allowable  1985  emissions  rate  multiplied by  the  unit's  baseline

adjusted to reflect operation at a 60 percent capacity factor, divided

by 2,000, exceeds (ii) the number of allowances allocated for the unit

pursuant  to paragraph  (1) and  section 403(a)(1)  as basic  Phase II

allowance allocations.

   "(B) In  addition to  allowances allocated  pursuant to  paragraph

(2)  and section 403(a)(1) as basic Phase II allowance allocations, at

the  election  of  the  designated  representative  of  the  operating

company, beginning  January  1,  2000,  and  for  each  calendar  year

thereafter until and including  2009, the Administrator shall allocate

annually   for  each   unit  subject   to  the   emissions  limitation

requirements  of paragraph  (2)  allowances from  the reserve  created

pursuant to  subsection (a)(2)  in an  amount equal to  the amount  by

which (i)  the  product  of  the  lesser of  the  unit's  actual  1985

emissions  rate or its allowable 1985 emissions rate multiplied by the

unit's baseline ad-

justed to reflect operation  at a 60 percent capacity  factor, divided

by 2,000, exceeds (ii) the number of allowances allocated for the unit

pursuant  to paragraph  (2) and  section 403(a)(1)  as basic  Phase II

allowance allocations.

   "(C)  An operating  company with  units subject  to the  emissions

limitation requirements of this subsection may elect the allocation of

allowances as provided under subparagraphs (A) and (B). Such  election

shall apply to the annual allowance allocation for each and every unit

in  the   operating  company  subject  to   the  emissions  limitation

requirements  of  this subsection.  The  Administrator shall  allocate

allowances pursuant  to subparagraphs (A)  and (B) only  in accordance

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