Title IV of the Clean Air Act, as amended by the Clean Air Act Amendments of 1990, (the Act) authorized the U.S. Environmental Protection Agency to establish the Acid Rain Program to reduce the adverse health and ecological effects of acidic deposition. Under the Acid Rain Program, electric utilities must have an allowance for each ton of sulfur dioxide (SO<INF>2) that their generating facilities emit. Title IV mandates that EPA hold or sponsor yearly auctions and direct sales of allowances for a small portion of the total allowances allocated each year. EPA is also required to make available to new independent power producers (IPPs) guarantees ensuring priority in purchasing allowances in the direct sales. Section 416(c)(7) of the Act directs the Administrator to terminate the direct sale program if, during any two-year period, less than 20 percent of the allowances available for direct sales have been purchased. The direct sale and IPP provisions were designed to help ensure that units, including new IPPs, have a public source of allowances beyond those already allocated initially. Because no allowances have been sold through the direct sale program since it began in June 1993, EPA is revising its regulations to terminate the direct sales. The allowances available previously in the direct sale program will now be available in the annual allowance auctions, the proceeds of which will continue to be returned to the utilities from which the allowances were withheld. In addition, because the IPP written guarantee program is implemented through the direct sales and no applications for such guarantees have been received, EPA is revising its regulations to terminate the guarantee program. The rule revision is being issued as a direct final rule because the Act mandates this action and no adverse comment is expected.