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with this subparagraph.

   "(4)  Notwithstanding any other provision of  this section, at the

election  of the  owner  or  operator,  after  January  1,  2000,  the

Administrator  shall  allocate  in  lieu of  allocation,  pursuant  to

paragraph (1), (2), (3), (5), or (6), allowances for a unit subject to

the   emissions  limitation  requirements  of  this  subsection  which

commenced  commercial operation on or after January 1, 1981 and before

December  31,  1985, which  was subject  to,  and in  compliance with,

section 111 of the  Act in an amount  equal to the unit's annual  fuel

consumption,  on  a  Btu  basis,  at  a  65  percent  capacity  factor

multiplied by  the unit's  allowable 1985  emissions rate, divided  by


   "(5) For the purposes of this section, in the case of an oil-  and

gas-fired  unit  which  has  been  awarded  a  clean  coal  technology

demonstration  grant as  of  January 1,  1991,  by the  United  States

Department  of Energy,  beginning January  1, 2000,  the Administrator

shall  allocate for  the  unit allowances  in an  amount equal  to the

unit's baseline multiplied by 1.20 lbs/mmBtu, divided by 2,000.

   "(e)  Oil  and Gas-fired  Units  Equal  to  or  Greater Than  0.60

lbs/mmBtu  and Less  Than 1.20  lbs/mmBtu.-After January  1,  2000, it

shall be unlawful for any existing  oil and gas-fired utility unit the

lesser  of whose actual or allowable 1985 sulfur dioxide emission rate

is equal  to, or  greater  than, 0.60  lbs/mmBtu, but  less than  1.20

lbs/mmBtu to  exceed an annual sulfur dioxide tonnage limitation equal

to the  product of the unit's baseline multiplied by (A) the lesser of

the  unit's allowable 1985 emissions rate or its actual 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.

   "(f) Oil and  Gas-fired Units Less Than 0.60  lbs/mmBtu.-(1) After

January  1,  2000, it  shall be  unlawful  for any  oil  and gas-fired

existing utility unit  the lesser  of whose actual  or allowable  1985

emission rate is  less than  0.60 lbs/mmBtu and  whose average  annual

fuel consumption during  the period 1980  through 1989 on a  Btu basis

was  90 percent or less in the form of natural gas to exceed an annual

sulfur dioxide  tonnage emissions 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, 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


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

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

beginning January 1, 2000, the Administrator shall, in the case of any

unit  operated  by  a  utility that  furnishes  electricity,  electric

energy, steam, and natural gas within an area consisting of a city and

1 contiguous  county, and in  the case  of any unit  owned by a  State

authority, the output of which unit is furnished within that same area

consisting  of a city and 1 contiguous county, the Administrator shall

allocate for  each unit in  the utility  its pro rata  share of  7,000

allowances and for each unit in the State authority its pro rata share

of 2,000 allowances.

   "(g) Units That  Commence Operation Between 1986 and  December 31,

1995.-(1) After January 1, 2000, it  shall be unlawful for any utility

unit  that has commenced commercial  operation on or  after January 1,

1986,  but  not later  than  September 30,  1990  to exceed  an annual

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