06-096-156 Me. Code R. § 5

Current through 2024-51, December 18, 2024

Section 096-156-5 - Compliance Requirements

A.Compliance Certification Report.

(1) Applicability and deadline. For each control period in which a CO₂ budget source is subject to the CO₂ budget emissions limitation, the CO₂ authorized account representative of the source shall submit to the Department by the March 1 following the relevant control period, a compliance certification report. A compliance certification report is not required as part of the compliance obligation during an interim control period.

(2) Contents of report. The CO₂ authorized account representative shall include in the compliance certification report under subsection 5(A)(1) of this Chapter the following elements, in a format prescribed by the Department:

(a) identification of the source and each CO₂ budget unit at the source;

(b) at the CO₂ authorized account representative's option, the serial numbers of the CO₂ allowances that are to be deducted from the source's compliance account under subsection 5(D) of this Chapter for the control period, including the serial numbers of any CO₂ offset allowances that are to be deducted subject to the limitations of subsection 5(D)(1)(c) of this Chapter; and

(c) the compliance certification under subsection 5(A)(3) of this Chapter.

(3) Compliance certification. In the compliance certification report under subsection 5(A)(1) of this Chapter, the CO₂ authorized account representative shall certify, based on reasonable inquiry of those persons with primary responsibility for operating the source and the CO₂ budget units at the source in compliance with the CO₂ Budget Trading Program, whether the source and each CO₂ budget unit at the source for which the compliance certification is submitted was operated during the calendar years covered by the report in compliance with the requirements of the CO₂ Budget Trading Program, including:

(a) whether the source was operated in compliance with the CO₂ budget emissions limitation;

(b) whether the monitoring plan applicable to each unit at the source has been maintained to reflect the actual operation and monitoring of the unit, and contains all information necessary to attribute CO₂ emissions to the unit, in accordance with section 4 of this Chapter;

(c) whether all the CO₂ emissions from the units at the source were monitored or accounted for through the missing data procedures and reported in the quarterly monitoring reports, including whether conditional data were reported in the quarterly reports in accordance with section 4 of this Chapter. If conditional data were reported, the owner or operator shall indicate whether the status of all conditional data has been resolved and all necessary quarterly report resubmissions have been made;

(d) whether the facts that form the basis for certification under section 4 of this Chapter of each monitor at each unit at the source, or for using an excepted monitoring method or alternative monitoring method approved under section 4 of this Chapter, if any, have changed; and

(e) if a change is required to be reported under subsection 5(A)(3)(d) of this Chapter, specify the nature of the change, the reason for the change, when the change occurred, and how the unit's compliance status was determined subsequent to the change, including what method was used to determine emissions when a change required monitor recertification.

B.Department Action on Compliance Certifications

(1) The Department or its agent may review and conduct independent audits concerning any compliance certification or any other submission under the CO₂ Budget Trading Program and make appropriate adjustments of the information in the compliance certifications or other submissions.

(2) The Department or its agent may deduct CO₂ allowances from or transfer CO₂ allowances to a source's compliance account based on the information in the compliance certifications or other submissions, as adjusted under subsection 5(B)(1) of this Chapter.

C.CO₂ Budget Unit Compliance Account Requirements

(1) For each control period, the owners and operators of each CO₂ budget source and each CO₂ budget unit at the source shall hold CO₂ allowances available for compliance deductions under subsection 5(D) of this Chapter, as of the CO₂ allowance transfer deadline, in the source's compliance account in an amount not less than the total CO₂ emissions for the control period from all CO₂ budget units at the source, less the CO₂ allowances deducted to meet the requirements of subsection 5(C)(2) of this Chapter, with respect to the previous two interim control periods, as determined in accordance with sections 4 and 7 of this Chapter.

(2) For each interim control period, the owners and operators of each CO₂ budget source and each CO₂ budget unit at the source shall hold CO₂ allowances available for compliance deductions under subsection 5(D) of this Chapter, as of the CO₂ allowance transfer deadline, in the source's compliance account in an amount not less than 50% of the total CO₂ emissions for the interim control period from all CO₂ budget units at the source, as determined in accordance with sections 4 and 7 of this Chapter.

(3) Each ton of CO₂ emitted in excess of the CO₂ budget emissions limitation for a control period shall constitute a separate violation of this Chapter and applicable state law.

(4) Each ton of excess interim emissions shall constitute a separate violation of this Chapter and applicable state law.

(5) A CO₂ budget unit shall be subject to the requirements under subsection 5(C)(1) of this Chapter starting on the later of January 1, 2009, the first full calendar quarter following the effective date of this regulation based on the criteria listed in subsection 1(A)(2) of this Chapter, or the date on which the unit commences operation.

(6) CO₂ allowances shall be held in, deducted from, or transferred among CO₂ Allowance Tracking System accounts in accordance with sections 2, 7, and 8, and with subsection 9(F) of this Chapter.

(7) A CO₂ allowance shall not be deducted, in order to comply with the requirements under subsection 5(C)(1) or (2) of this Chapter, for a control period or interim control period that ends prior to the year for which the CO₂ allowance was allocated. A CO₂ offset allowance shall not be deducted, in order to comply with the requirements under subsection 5(C)(1) or (2) of this Chapter, to cover emissions beyond the applicable percentage limitations set out in subsection 5(D)(1)(c) of this Chapter.

(8) A CO₂ allowance under the CO₂ Budget Trading Program is a limited authorization by the Department to emit one ton of CO₂ in accordance with the CO₂ Budget Trading Program. No provision of the CO₂ Budget Trading Program, the CO₂ budget license application, or the CO₂ budget license, or any provision of law shall be construed to limit the authority of the Department to terminate or limit such authorization.

(9) A CO₂ allowance under the CO₂ Budget Trading Program does not constitute a property right.

D.Compliance Deductions

(1) Allowances available for compliance deduction. CO₂ allowances that meet the following criteria are available to be deducted for compliance with a CO₂ budget source's CO₂ budget emissions limitation for a control period or an interim control period.

(a) The CO₂ allowances, other than CO₂ offset allowances, are of allocation years that fall within a prior control period, the same control period, or the same interim control period for which the allowances will be deducted. Allowances from allocation years that fall after an interim control period may not be used for compliance deduction for that interim control period.

(b) The CO₂ allowances are held in the CO₂ budget source's compliance account as of the CO₂ allowance transfer deadline for that control period or interim control period, or are transferred into the compliance account by a CO₂ allowance transfer correctly submitted for recordation under subsection 8(A) of this Chapter by the CO₂ allowance transfer deadline for that control period or interim control period.

(c) For CO₂ offset allowances, the number of CO₂ offset allowances that are available to be deducted for compliance with a CO₂ budget source's CO₂ budget emissions limitation for a control period or interim control period may not exceed 3.3 percent of the CO₂ budget source's CO₂ emissions for that control period, or 3.3 percent of one half of the CO₂ budget source's CO₂ emissions for an interim control period, as determined in accordance with sections 4 and 7 of this Chapter.

(d) The CO₂ allowances are not necessary for deductions for excess emissions for a prior control period under subsection 5(D)(4) of this Chapter.

(2) Deductions for compliance. Following the CO₂ allowance transfer deadline for a control period or interim control period, the Department or its agent will deduct CO₂ allowances available under subsection 5(D)(1) of this Chapter to cover the source's CO₂ emissions (as determined in accordance with section 4 of this Chapter) for the control period or interim control period, as follows:

(a) until the amount of CO₂ allowances deducted equals the number of tons of total CO₂ emissions (or 0.50 times the number of tons of total CO₂ emissions for an interim control period), as determined in accordance with section 4 of this Chapter, from all CO₂ budget units at the CO₂ budget source for the control period or interim control period; or

(b) if there are insufficient CO₂ allowances to complete the deductions in subsection 5(D)(2)(a) of this Chapter, until no more CO₂ allowances available under subsection 5(D)(1) of this Chapter remain in the compliance account.

(3) Identification of available CO₂ allowances by serial number and default compliance deductions.

(a) The CO₂ authorized account representative for a source's compliance account may request that specific CO₂ allowances, identified by serial number, in the compliance account be deducted for emissions or excess emissions for a control period or interim control period in accordance with either subsection 5(D)(2) or 5(D)(4) of this Chapter. Such identification shall be made in the compliance certification report submitted in accordance with subsection 5(A) of this Chapter.

(b) The Department or its agent will deduct CO₂ allowances for a control period or interim control period from the CO₂ budget source's compliance account, in the absence of an identification or in the case of a partial identification of available CO₂ allowances by serial number under subsection 5(D)(3)(a) of this Chapter, in the following descending order:

(i) First, subject to the relevant compliance deduction limitations under subsection 5(D)(1)(c) of this Chapter, any CO₂ offset allowances transferred and recorded in the compliance account pursuant to section 8 of this Chapter. CO₂ offset allowances shall be deducted in chronological order (i.e., CO₂ offset allowances from earlier allocation years shall be deducted before those from later allocation years). In the event that some, but not all, CO₂ offset allowances from a particular year are to be deducted, the CO₂ offset allowances from that allocation year shall be deducted in order according to serial number, with lower-numbered allowances deducted before higher-numbered allowances.

(ii) Second, any CO₂ allowances, other than CO₂ offset allowances, that are available for deduction under subsection 5(D)(1) of this Chapter. CO₂ allowances shall be deducted in chronological order (i.e., CO₂ allowances from earlier allocation years shall be deducted before those from later allocation years). In the event that some, but not all, CO₂ allowances from a particular year are to be deducted, the CO₂ allowances from that allocation year shall be deducted in order according to serial number, with lower-numbered allowances deducted before higher-numbered allowances.

(4) Deductions for excess emissions.

(a) After making the deductions for compliance under subsection 5(D)(2) of this Chapter, the Department or its agent will deduct from the CO₂ budget source's compliance account a number of CO₂ allowances equal to three times the number of the source's excess emissions in tons of CO₂.In the event that the source's compliance account has insufficient CO₂ allowances to cover three times the number of tons of excess emissions, the source shall be required immediately to transfer sufficient allowances into its compliance account. No CO₂ offset allowances may be deducted to account for the source's excess emissions.

(b) Any CO₂ allowance deductions required under subsection 5(D)(4)(a) of this Chapter shall not affect the liability of the owners and operators of the CO₂ budget source or the CO₂ units at the source for any fine, penalty, or assessment, or their obligation to comply with any other remedy for the same violation, as ordered under applicable State law. The following guidelines will be followed in assessing fines, penalties, or other obligations:

(i) For purposes of determining the number of days of violation, if a CO₂ budget source has excess emissions for a control period, each day in the control period constitutes a day in violation unless the owners and operators of the unit demonstrate that a lesser number of days should be considered.

(ii) Each ton of excess emissions is a separate violation.

(iii) For purposes of determining the number of days of violation, if a CO₂ budget source has excess interim emissions for an interim control period, each day in the interim control period constitutes a day in violation unless the owners and operators of the unit demonstrate that a lesser number of days should be considered.

(iv) Each ton of excess interim emissions is a separate violation.

(c) The propriety of the Department's determination that a CO₂ budget source had excess emissions and the concomitant deduction of CO₂ allowances from that CO₂ budget source's compliance account may be later challenged in the context of the initial administrative enforcement or any civil or criminal judicial action arising from or encompassing that excess emissions violation. The commencement or pendency of any administrative enforcement or civil or criminal judicial action arising from or encompassing that excess emissions violation will not act to prevent the Department or its agent from initially deducting the CO₂ allowances resulting from the Department's original determination that the relevant CO₂ budget source has had excess emissions. Should the Department's determination of the existence or extent of the CO₂ budget source's excess emissions be revised either by a settlement or final conclusion of any administrative or judicial action, the Department will act as follows:

(i) In any instance where the Department's determination of the extent of excess emissions was too low, the Department will take further action under subsections 5(D)(4)(a) and (b) of this Chapter to address the expanded violation.

(ii) In any instance where the Department's determination of the extent of excess emissions was too high, the Department will distribute to the relevant CO₂ budget source a number of CO₂ allowances equaling the number of CO₂ allowances deducted which are attributable to the difference between the original and final quantity of excess emissions. Should the CO₂ budget source's compliance account no longer exist, the CO₂ allowances will be provided to a general account selected by the owner or operator of the CO₂ budget source from which they were originally deducted.

E.Action by the Department on submissions

(1) The Department may review and conduct independent audits concerning any submission under the CO₂ Budget Trading Program and make appropriate adjustments of the information in the submission.

(2) The Department may deduct CO₂ allowances from or transfer CO₂ allowances to a source's compliance account based on information in a submission, as adjusted under subsection 5(E)(1) of this Chapter.

06-096 C.M.R. ch. 156, § 5