(a) An electric generating facility is considered permitted under this section with respect to all air contaminants if the facility is:
(1) a natural-gas-fired electric generating facility that has applied for or obtained a permit under § 39.264, Utilities Code; or
(2) an electric generating facility exempted from permitting under § 39.264(d), Utilities Code.
(b) A coal-fired electric generating facility that is required to obtain a permit under § 39.264, Utilities Code:
(1) shall be considered permitted under this section with respect to nitrogen oxides, sulphur dioxide, and, as provided by commission rules, for opacity if the facility has applied for or obtained a permit under § 39.264, Utilities Code; and
(2) is not considered permitted for criteria pollutants not described by Subsection (b)(1).

(c) The commission shall issue a permit for a facility subject to Subsection (b) for criteria pollutants not covered by Subsection (b)(1) if the commission finds that the emissions from the facility will not contravene the intent of this chapter, including protection of the public’s health and physical property. Upon request by the applicant, the commission shall include a permit application under this subsection with the applicant’s pending permit application under § 39.264, Utilities Code.
(d) The owner or operator of an electric generating facility with a permit or an application pending under § 39.264, Utilities Code, may apply for a permit under this section before September 1, 2002, for a facility located at the same site if the facility not permitted or without a pending application under § 39.264, Utilities Code, is:
(1) a generator that does not generate electric energy for compensation and is used not more than 10 percent of the normal annual operating schedule; or
(2) an auxiliary fossil-fuel-fired combustion facility that does not generate electric energy and does not emit more than 100 tons of any air contaminant annually.
(e) Emissions from facilities permitted under Subsection (d) shall be included in the emission allowance trading program established under § 39.264, Utilities Code. The commission may not issue new allowances based on a permit issued under this section.
(f) A person planning the modification of a facility previously permitted under this section must comply with Section 382.0518 before modifying.
(g) The commission may adopt rules as necessary to implement and administer this section.
(h) A permit application under this section is subject to notice and hearing requirements as provided by Section 382.05191.
(i) For the purposes of this section, a natural-gas-fired electric generating facility includes a facility that was designed to burn either natural gas or fuel oil of a grade approved by commission rule. The commission shall adopt rules regarding acceptable fuel oil grades.