Current through Register 2024 Notice Reg. No. 38, September 20, 2024
(a) A covered entity must surrender one
compliance instrument for each metric ton of CO2e of GHG
emissions for the annual and full compliance period compliance obligations
calculated pursuant to this subarticle beginning with the emissions data report
for 2013 emissions and each subsequent year in which the covered entity has a
compliance obligation.
(b)
Compliance Instruments Valid for Surrender.
(1) A compliance instrument listed in
subarticle 4 may be used to satisfy a compliance obligation.
(2) To fulfill a compliance obligation, a
compliance instrument issued pursuant to sections
95820(a) and
95821(a) must be
issued from an allowance budget year within or before the year for which an
annual compliance obligation is calculated or the last year of a compliance
period for which a full compliance period compliance obligation is calculated,
unless:
(A) The allowance is a Reserve
Allowance or a non-vintage allowance issued by a program approved by ARB
pursuant to section
95941 as specified in section
95821(a);
(B) The allowance is used to satisfy an
excess emissions obligation; or
(C)
The allowance is eligible for compliance use pursuant to sections
95856(h)(1)(D)
and 95856(h)(2)(D).
(c) A covered entity must transfer from its
holding account to its compliance account a sufficient number of valid
compliance instruments to meet the compliance obligation set forth in sections
95853 and
95855.
(d) Deadline for Surrender of Annual
Compliance Obligations. For any year in which a covered entity has an annual
compliance obligation pursuant to section
95855, it must fulfill that
obligation:
(1) By November 1, 5 p.m. Pacific
Standard Time (or Pacific Daylight Time, when in effect), of the calendar year
following the year for which the obligation is calculated if the entity reports
by April 10 pursuant to section
95103 of MRR; or
(2) By November 1, 5 p.m. Pacific Standard
Time (or Pacific Daylight Time, when in effect), of the calendar year following
the year for which the obligation is calculated if the entity reports by June 1
pursuant to section
95103 of MRR.
(3) In years 2015, 2018, and 2021 there is no
annual compliance obligation for the preceding compliance period, only a full
compliance period compliance obligation.
(4) Transfers to compliance accounts may be
restricted during the time the tracking system is processing the surrender of
the annual compliance obligation.
(e) Determination of Full Compliance Period
Compliance Obligation.
(1) When a positive or
qualified positive emissions data verification statement or assigned emissions
for any year is received by ARB, then those emissions for the source categories
in section
95852 contribute to the full
compliance period compliance obligation pursuant to section
95853.
(2) If a positive or qualified positive
emissions data verification statement for any year of the compliance period is
not received by ARB by the applicable verification deadline as set forth in
MRR, ARB will assign emissions according to the requirements set forth in
section 95103(g) of MRR
for the emissions for the source categories in section
95852. The assigned emissions
value then contributes to the full compliance period compliance obligation
pursuant to section
95853.
(f) Surrender of Full Compliance Period
Compliance Obligation.
(1) The covered entity
must transfer sufficient valid compliance instruments to its compliance account
to fulfill its full compliance period compliance obligation by November 1, 5
p.m. Pacific Standard Time (or Pacific Daylight Time, when in effect), of the
calendar year following the final year of the compliance period. Transfers to
compliance accounts may be restricted during the time the tracking system is
processing the surrender of the full compliance period compliance
obligation.
(2) The total number of
compliance instruments submitted to fulfill the full compliance period
compliance obligation is subject to the quantitative use limit pursuant to
section 95854.
(3) The surrender of compliance instruments
must equal the full compliance period compliance obligation calculated pursuant
to section
95853 less compliance instruments
surrendered to fulfill the annual compliance obligation for the years in the
compliance period.
(g) In
determining whether the covered entity has fulfilled its compliance
obligations, the Executive Officer shall:
(1)
In the case of annual and full compliance period compliance obligations,
determine the status of compliance with the annual or full compliance period
compliance obligation by evaluating the number and types of compliance
instruments in the Compliance Account; and
(A)
Retire the compliance instruments surrendered; and
(B) Inform programs to which California is
linked or recognizes, pursuant to subarticles 12 and 14, of the retirements,
including the serial numbers of the compliance instruments
retired.
(h)
Annual and Full Compliance Period Compliance Instrument Requirements.
(1) When a covered entity or opt-in covered
entity surrenders compliance instruments to meet its annual compliance
obligation pursuant to section
95856(d), the
Executive Officer will retire them from the Compliance Account in the following
order: section
95856(d), the
Executive Officer will retire them from the Compliance Account in the following
order:
(A) Offset credits specified in section
95820(b) and
sections 95821(b) through
(d), up to eight percent of the emissions
with a compliance obligation pursuant to section
95854;
(B) Reserve Allowances followed by
non-vintage allowances issued by a program approved by ARB pursuant to section
95941 as specified in section
95821(a);
(C) Allowances specified in sections
95820(a) and
95821(a) with
earlier vintage allowances retired first;
(D) The current calendar year's vintage
allowances and allowances allocated just before the annual surrender deadline
up to the true-up allowance amount as determined in sections
95891(b),
95891(c),
95891(c)(2)(B),
95891(f)(1), or
95894(c)-(e) if
an entity was eligible to receive true up allowances pursuant to section
95891(b),
95891(c),
95891(c)(2)(B),
95891(f)(1), or
95894(c)-(e);
and
(E) Price ceiling units
specified in section
95915.
(2) When a covered entity or opt-in covered
entity surrenders compliance instruments to meet its full compliance period
compliance obligation pursuant to section
95856(f), the
Executive Officer will retire them from the Compliance Account in the following
order:
(A) Offset credits specified in section
95820(b) and
sections 95821(b) through
(d) with oldest credits retired first and
subject to the quantitative usage limit set forth in section
95854;
(B) Reserve Allowances followed by
non-vintage allowances issued by a program approved by ARB pursuant to section
95941 as specified in section
95821(a);
(C) Allowances specified in sections
95820(a) and
95821(a) with
earlier vintage allowances retired first;
(D) The current calendar year's vintage
allowances and allowances allocated just before the full compliance period
surrender deadline up to the true-up allowance amount as determined in section
95891(b),
95891(c),
95891(c)(2)(B),
95891(f)(1), or
95894(c)-(e) if
an entity was eligible to receive true up allowances pursuant to section
95891(b),
95891(c),
95891(c)(2)(B),
95891(f)(1), or
95894(c)-(e);
and
(E) Price ceiling units
specified in section
95915.
(3) An entity that is not eligible to receive
true up allowances pursuant to section
95891(b),
95891(c),
95891(c)(2)(B),
95891(f)(1) or
95894(c)-(e)
cannot use the current calendar year's vintage allowances or allowances
allocated just before the current surrender deadline to meet the timely
surrender of compliance instrument requirements in section
95856.
(4) An electric distribution utility will not
be in violation of section
95892(d)(7) when
the Executive Officer retires compliance instruments if the electric
distribution utility has a quantity of eligible compliance instruments not
allocated pursuant to section
95870(d) in its
compliance account at the time the timely surrender of compliance instruments
by a covered entity is due, pursuant to section
95856, that is at least equal to
its compliance obligation for any transactions for which the use of allocated
allowance value is prohibited under section
95892(d)(7).
1. New
section filed 12-13-2011; operative 1-1-2012 pursuant to Government Code
section
11343.4
(Register 2011, No. 50).
2. Amendment of subsection (b)(2) filed
8-29-2012; operative 9-1-2012 pursuant to Government Code section
11343.4
(Register 2012, No. 35).
3. Amendment filed 6-26-2014; operative
7-1-2014 pursuant to Government Code section
11343.4(b)(3)
(Register 2014, No. 26).
4. Amendment filed 9-18-2017; operative
10-1-2017 pursuant to Government Code section
11343.4(b)(3)
(Register 2017, No. 38).
5. Amendment of subsections (b)(2)(A),
(e)(1)-(2) and (h)(1)(B)-(D), new subsection (h)(1)(E), amendment of
subsections (h)(2)(A)-(D), new subsection (h)(2)(E) and amendment of
subsections (h)(3)-(4) filed 3-29-2019; operative 3-29-2019 pursuant to
Government Code section
11343.4(b)(3)
(Register 2019, No. 13).
Note: Authority cited: Sections
38510,
38560,
38562,
38570,
38571,
38580,
39600
and
39601,
Health and Safety Code. Reference: Sections
38530,
38560.5,
38564,
38565,
38570
and
39600,
Health and Safety Code.
