q-2, r. 46.1 - Regulation respecting a cap-and-trade system for greenhouse gas emission allowances

À jour au 23 mars 2017

Ce document a valeur officielle.

chapter Q-2, r. 46.1

Regulation respecting a cap-and-trade system for greenhouse gas emission allowances

Environment Quality Act

(chapter Q-2, s. 31, 1st par., subpars. b, c, d, e.1, h and h.1, ss. 46.1, 46.5, 46.6, 46.8 to 46.16, 115.27 and 115.34.).

TITLE I GENERAL

CHAPTER I SCOPE, APPLICATION AND INTERPRETATION

1. The purpose of this Regulation is to set rules for the operation of the cap-and-trade system for greenhouse gas emission allowances established pursuant to section 46.5 of the Environment Quality Act (chapter Q-2). For that purpose, it determines which emitters are required to cover their emissions, the terms and conditions for registering for the system, the emission allowances that can be validly used, the terms and conditions for the issue, use and trading of emission allowances, and the information that must be provided by emitters and other persons or municipalities that may register for in the system.

O.C. 1297-2011, s. 1; O.C. 1184-2012, s. 1.

2. For the purposes of this Regulation, an emitter is any person or municipality operating an enterprise in a sector of activity listed in Appendix A and reporting for an establishment or, if applicable, for the enterprise, in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), annual greenhouse gas emissions in a quantity equal to or greater than 25,000 metric tonnes CO2 equivalent, excluding the emissions referred to in the second paragraph of section 6.6 of that Regulation.

(1)  (subparagraph replaced);

(2)  (subparagraph replaced);

(3)  (subparagraph replaced);

(4)  (subparagraph replaced);

(5)  (subparagraph replaced);

(6)  (subparagraph replaced).

A person or municipality operating an enterprise is also considered to be an emitter if the person or municipality

(1)  acquires electricity generated outside Québec, except electricity produced in the territory of a partner entity, for its own consumption or for sale in Québec, if the greenhouse gas emissions attributable to the generation of the quantity of electricity acquired, calculated in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere, are equal to or exceed 25,000 metric tonnes CO2 equivalent;

(2)  distributes 200 litres or more of fuel within the meaning of protocol QC.30 of Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere.

For the purposes of subparagraph 2 of the second paragraph, “fuel” means automotive gasoline, diesel fuels, propane, natural gas and heating fuel, except

(1)  aviation fuel and fuel oil for ships;

(2)  hydrocarbons used as raw material by industries that transform hydrocarbon molecules through chemical or petrochemical processes;

(3)  the biomass and biomass fuel component of such fuel;

(4)  fuel for which an emitter referred to in the first paragraph of section 2, including the emitter itself, as the case may be, is required to cover its emissions pursuant to section 19.

O.C. 1297-2011, s. 2; O.C. 1184-2012, s. 2; O.C. 1138-2013, s. 1; O.C. 902-2014, s. 1; O.C. 1089-2015, s. 1.

3. For the purposes of this Regulation,

(1)  “biomass fuel” means any fuel whose entire energy generating capacity is derived from biomass;

(2)  “biomass” means a non-fossilized plant or part of a plant, an animal carcass or part of an animal, manure, liquid manure, a micro-organism and any other product derived from such matters;

(3)  “emissions report” means a greenhouse gas emissions report made in accordance with Division II.1 of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15);

(4)  “compliance deadline” means the deadline referred to in the first paragraph of section 21 for covering greenhouse gas emissions in a compliance period;

(4.1)  “officer” means the president, chief executive officer, chief operating officer, chief financial officer or secretary of a legal person or partnership or any person having similar functions, and any person designated as such by a resolution of the board of directors;

(5)  “emission allowance” means any emission allowance referred to in the second paragraph of section 46.6 of the Environment Quality Act (chapter Q-2), namely a greenhouse gas emission unit, offset credit or early reduction credit, and any emission allowance issued by a partner entity, each allowance having a value corresponding to one metric ton of greenhouse gas CO2 equivalent;

(6)  “reported emissions” means greenhouse gas emissions that are

(a)  reported in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere but that do not need to be verified pursuant to that Regulation; or

(b)  calculated using data provided by the emitter when the emitter was not required, prior to 1 January 2011, to report emissions pursuant to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere;

(7)  “verified emissions” means the greenhouse gas emissions mentioned in a verification report and, where applicable, a notice of correction in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), in metric tonnes CO2 equivalent;

(8)  “partner entity” means a government other than the Government of Québec, a department of such a government, an international organization, or an agency of such a government or organization, with which an agreement has been entered into in accordance with section 46.14 of the Environment Quality Act and that is referred to in Appendix B.1 to this Regulation;

(9)  “covered establishment” means an establishment referred to in the first paragraph of section 2 or an enterprise referred to in the second paragraph of that section for which the emitter is required to cover greenhouse gas emissions in accordance with Chapter III of Title II;

(10)  “greenhouse gas” or “GHG” means one or more of the gases listed in the second paragraph of section 46.1 of the Environment Quality Act, namely carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulphur hexafluoruride (SF6), as well as nitrogen trifluoride (NF3);

(10.1)  “working day” means any day other than a Saturday, Sunday or statutory holiday, including statutory holidays in the territory of a partner entity;

(11)  “new facility” means either

(a)  a combination of apparatus and equipment intended for a specific purpose, installed and commissioned on or after 1 January 2012 on the site of a covered establishment to pursue the same type of activity, to which GHS emissions in one of the following quantities are attributable:

i.  a quantity equal to or exceeding 25,000 metric tonnes CO2 equivalent;

ii.  a quantity representing over 15% of the average annual emissions of the establishment for the period 2007-2010; or

(b)  part of all of the combination of apparatus and equipment intended for a specific purpose at a covered establishment that is modified and commissioned on or after 1 January 2012 with the result that the establishment pursues a type of activity referred to in Table B of Part I of Schedule C or any other type of activity that it did not previously pursue;

(12)  “compliance periods” means any period for which an emitter is required to cover its greenhouse gas emissions, the first period starting on 1 January 2013 and ending on 31 December 2014, and the following periods are of 3 calendar years as of 1 January 2015;

(12.1)  “promoter” means a person who implements an offset credit project;

(12.2)  “total quantity of reference units” means the quantity of reference units produced or used during a year by an emitter

(a)  for the years 2007 to 2011, calculated using the information provided by the emitter; and

(b)  for the years 2012 and following, mentioned in the verification report in accordance with section 6.9 of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere;

(13)  “emissions threshold” means the level of greenhouse gas emissions or, by assimilation, the quantity of fuel determined in the first and second paragraphs of section 2;

(14)  “system” means the cap-and-trade system for greenhouse gas emission allowances;

(15)  “reference unit” means a standard unit of measurement for a raw material used to pursue an activity or for a product resulting from an activity of an emitter, referred to in Table B of Part I of Schedule C.

O.C. 1297-2011, s. 3; O.C. 1184-2012, s. 3; O.C. 1089-2015, s. 2; I.N. 2016-01-01 (NCCP).

CHAPTER II INFORMATION AND DOCUMENTS

4. Every person or municipality to which the provisions of this Regulation apply must keep a copy of all the information and documents that must be filed under this Regulation or relating to any transaction within the system for a minimum period of 7 years starting on the date on which they are produced.

Documents and information relating to a project involving early reduction credits referred to in Chapter III of Title III must be kept for a minimum period of 7 years starting on the date on which the application for credits was forwarded to the Minister.

Documents and information relating to an offset credit project referred to in Chapter IV of Title III must be kept for the duration of the project and for a minimum period of 7 years starting on the date on which the project ended.

In addition, in the case of a designation or authorization made in accordance with section 10, 12 or 18.2, a copy of the information and documents relating to the designation or authorization must be kept for the entire period of the designation or authorization of the person concerned and for a minimum period of 7 years following the end of that period.

Documents and information referred to in this section must also be provided to the Minister on request.

Documents and information provided pursuant to this Regulation are dealt with confidentially, subject to the Act respecting Access to documents held by public bodies and the Protection of personal information (chapter A-2.1).

O.C. 1297-2011, s. 4; O.C. 1184-2012, s. 4; O.C. 1089-2015, s. 3.

5. Any information or document required to be provided under this Regulation must be sent to the Minister using the forms available on the website of the Ministère du Développement durable, de l’Environnement, de la Faune et des Parcs.

Despite the first paragraph, where all or part of the system is delegated to a person or a body pursuant to the second paragraph of section 46.13 of the Environment Quality Act (chapter Q-2), the information and documents indicated in the notice published in accordance with the third paragraph of that section must be sent to the delegatee.

O.C. 1297-2011, s. 5; O.C. 1184-2012, s. 5; O.C. 902-2014, s. 2.

TITLE II CAP-AND-TRADE SYSTEM FOR GREENHOUSE GAS EMISSION ALLOWANCES

CHAPTER I ADMINISTRATIVE ACCOUNTS

6. For system administration purposes, the Minister keeps the following accounts:

(1)  an issuance account, containing the emission units created on the basis of the caps established in accordance with section 46.7 of the Environment Quality Act (chapter Q-2);

(1.1)  an allocation account, containing the emission units available for allocation without charge, calculated in accordance with Part II of Appendix C of this Regulation;

(2)  an auction account, containing the emission units to be sold at auction;

(3)  a reserve account, containing emission units intended for sale by mutual agreement by the Minister or to be used to adjust the quantity of emission units allocated without charge;

(4)  a retirement account, in which emission allowances retired from the system are recorded in accordance with this Regulation;

(5)  an environmental integrity account, containing the offset credits that may be extinguished to replace the illegitimate offset credits not surrendered by a promoter;

(6)  an invalidation account, containing offset credits issued and cancelled by a partner entity and offset credits withdrawn from the environmental integrity account to replace illegitimate offset credits in accordance with the fourth paragraph of section 70.21;

(7)  a cancellation account in which cancelled emission allowances are recorded when created by error.

O.C. 1297-2011, s. 6; O.C. 1184-2012, s. 6; O.C. 902-2014, s. 3; O.C. 1089-2015, s. 4.

CHAPTER II REGISTRATION OF EMITTERS AND PARTICIPANTS

7. Every emitter to which this Regulation applies must register for the system by providing the Minister with the following information and documents:

(1)  the name and contact information for the enterprise, any other name used by the enterprise in Québec to identify itself in the pursuit of its activities, its legal status, the date and place of its constitution and the business number assigned under the Act respecting the legal publicity of enterprises (chapter P-44.1);

(2)  a list of its directors and officers including their work addresses;

(3)  the name and contact information for each establishment covered, the type of operation, the activities pursued, the processes and equipment used and, if applicable, the 6-digit code under the North American Industry Classification System (NAICS Canada) and establishment number assigned under the Inventaire québécois des émissions atmosphériques kept by the Ministère du Développement durable, de l’Environnement, de la Faune et des Parcs;

(4)  except for the emitter referred to in subparagraph 1 of the second paragraph of section 2, for each of the 3 years preceding the application for registration and for each establishment covered that exercises an activity listed in Table A in Part I of Appendix C,

(a)  the total quantity of GHG emissions, either reported or verified, by category of GHG emissions referred to in Division B of Part II of Schedule C, in metric tonnes CO2 equivalent;

(b)  the total quantity of each reference unit;

(c)  the total quantity of GHG emissions, by category of GHG emissions referred to in Division B of Part II of Schedule C, for each reference unit, in metric tonnes CO2 equivalent;

(d)  the total quantity of fuel used, by type of fuel and by reference unit; and

(e)  the calculation methods used;

(5)  the name and contact information of the person responsible for the GHG emissions report for each covered establishment;

(6)  a list of the subsidiaries or parent legal persons of the emitter, with the control percentage between each entity, which information may also be provided in the form of a diagram;

(7)  in the case of a business corporation, the names and contact information of the persons controlling over 10% of the voting rights attached to all the outstanding voting securities of the emitter;

(8)  in the case of a partnership, the name and contact information of each partner or, in the case of a limited partnership, the name and contact information of each general partner and the name and contact information of each special partner having provided over 10% of the common stock;

(9)  a declaration signed by the chief officer or a resolution of the board of directors including an undertaking to comply with the conditions of this Regulation and attesting that the information and documents provided are valid and that consent has been given as to their communication when necessary for the purposes of this Regulation and of the corresponding rules and regulations of a partner entity.

An application for registration for the system must be sent to the Minister

(1)  on or after 1 May 2012 but not later than 1 September 2012, in the case of an emitter other than an emitter referred to in subparagraph 2 of this paragraph whose reported emissions for 2009, 2010 or 2011 for an establishment are equal to or exceed the emissions threshold;

(2)  not later than 1 September 2014, in the case of an emitter pursuing fuel distribution activities whose reported emissions for 2013 are equal to or exceed the emissions threshold;

(3)  not later than 1 September following the submission of the first emissions report reporting emissions equal to or exceeding the threshold, in the case of an emitter referred to in subparagraph 1 of this paragraph whose verified emissions for an establishment are equal to or exceed the emissions threshold during a year following the year mentioned in that subparagraph;

(4)  not later than 1 September 2015, in the case of an emitter pursuing fuel distribution activities whose verified emissions for 2014 for those activities are equal to or exceed 25,000 metric tonnes CO2 equivalent;

(5)  on or after 1 January 2016 but not later than 1 September 2016, in the case of an emitter pursuing fuel distribution activities who can prove that the verified emissions for 2015 for those activities will be equal to or exceed 25,000 metric tonnes CO2 equivalent;

(6)  on or after 1 January of the year concerned, but not later than 1 September following the submission of the first emissions report reporting emissions equal to or exceeding the threshold, in the case of an emitter pursuing fuel distribution activities who can demonstrate that the verified emissions for 2016 or a subsequent year will be equal to or exceed the emissions threshold.

O.C. 1297-2011, s. 7; O.C. 1184-2012, s. 7; O.C. 1138-2013, s. 2; O.C. 902-2014, s. 4; O.C. 1089-2015, s. 5.

8. Only a natural person domiciled in Canada and having previously obtained an identifier in accordance with section 10 or another person or municipality having an establishment in Canada may register with the Minister as a participant in the system in order to acquire emission allowances. The applicant must provide the Minister with the following information and documents:

(1)  the applicant’s name and contact information;

(2)  in the case of an applicant other than a natural person or a municipality, the information and documents referred to in subparagraphs 1 to 3 and 6 to 9 of the first paragraph of section 7, with the necessary modifications;

(3)  if the application is made by a natural person who is not domiciled in Québec, the name and contact information of a natural person domiciled in Québec who is designated to represent the applicant;

(4)  if the application is made by a natural person, a declaration signed by the person or, in other cases, a declaration signed by the chief officer or a resolution of the board of directors including an undertaking to comply with the conditions of this Regulation.

However, a natural person employed by an emitter or a participant may not be registered as a participant in the system.

Despite the second paragraph, in the case of a natural person employed by an emitter or a participant who registered as a participant before 22 October 2014, the person’s registration will be authorized until 22 October 2016, after that it will be terminated. Until that date, the person may not participate in an auction sale of emission units.

O.C. 1297-2011, s. 8; O.C. 1184-2012, s. 8; O.C. 902-2014, s. 5; O.C. 1089-2015, s. 6.

8.1. Every person or municipality that is already registered as an emitter or clearing house pursuant to this Regulation or as an emitter, participant or clearing house in the cap-and-trade system for GHG emission allowances of a partner entity is considered to be registered for the system and cannot register again as a participant or clearing house with the Minister.

O.C. 1184-2012, s. 8; O.C. 1138-2013, s. 3; O.C. 1089-2015, s. 7.

9. Every person submitting an application for registration to the Minister under sections 7 and 8 must also disclose any business relationship with an emitter or participant registered for the system, including those registered with a partner entity, by providing the following information in particular:

(1)  the name and contact information of any other emitter or participant with which the applicant is related, and of any other parent legal person, subsidiary or group concerned by the relationship;

(2)  the type of business relationship between the emitters or participants with which it has a business relationship and their respective status, such as parent legal person, subsidiary, group, partner or other, along with a brief description of the business relationship and the control percentage between each entity, which information may also be provided in the form of a diagram;

(2.1)  where applicable, the general account number of the emitter or participant with which it has a business relationship, the name and contact information of its primary account representative and, if the emitter or participant is not a natural person, its legal status and the date and place of its constitution;

(3)  where applicable, the percentage share of the overall holding limit and of the overall purchasing limit at an auction that is attributed to each related entity in the distributions made, respectively, in accordance with section 33 and the fifth paragraph of section 50.

For the purposes of this section,

(1)  “business relationship” means any direct or indirect relationship between several different emitters or participants when one of them

(a)  holds more than 20% of the securities of another emitter or participant or holds a call provision or call option for such securities;

(b)  shares more than 20% of its officers or directors with another emitter or participant, or may appoint up to 20% of its officers or directors;

(c)  holds more than 20% of the voting rights in another emitter or participant;

(d)  controls over 20% of the business of another emitter or participant by any means; or

(e)  belongs to the same group as another emitter or participant;

(2)  “subsidiary” means a person controlled by another person or by persons controlled by that other person; the subsidiary of a person that is, itself, the subsidiary of another person is deemed to be a subsidiary of that other person;

(3)  “group” means 2 or more persons when

(a)  one is a subsidiary of the other;

(b)  all the persons are subsidiaries of the same person; or

(c)  they are all controlled by the same person;

(4)  “control” means a person that, with regard to another person,

(a)  owns or has control or direction, whether direct or indirect, over securities of the other person or company carrying votes which, if exercised, would entitle the person to elect a majority of the directors of the other person, unless the person holds the voting securities only to secure an obligation;

(b)  in the case of a partnership other than a limited partnership, holds more than 50% of the interests of the partnership; or

(c)  in the case of a limited partnership, is the general partner;

(5)  “related entity” means any emitter or participant with which the business relationship as defined in subparagraph 1 involves a percentage of over 50%, a subsidiary, or an emitter or participant belonging to the same group, as well as any emitter or participant who share an account representative who also works for one of them.

O.C. 1297-2011, s. 9; O.C. 1184-2012, s. 9; O.C. 902-2014, s. 7; O.C. 1089-2015, s. 8.

10. To have access to the electronic system, a natural person must obtain an identifier by providing the Minister with the following information and documents:

(1)  the person’s name and contact information at the person’s home address;

(2)  the person’s date of birth;

(3)  copies of at least 2 identity documents, including one with a photograph, issued by a government or one of its departments or agencies, bearing the person’s name and date of birth, along with an attestation from a notary or advocate, completed less than 3 months prior to the application for registration, stating that the notary or advocate has established the identity of the person and certifying the authenticity of the copies of the identity documents;

(4)  the name and contact information of the person’s employer;

(5)  confirmation from a financial institution located in Canada that the person has an account with the institution and that an identity check was carried out;

(6)  any conviction for a criminal offence or an offence referred to in section 13 from the 5 years prior to the submission of the information and documents;

(7)  a declaration, signed by the person and attesting

(a)  that the information and document provided are valid and that the person consents to their communication when necessary for the purposes of this Regulation and the corresponding rules and regulations of a partner entity;

(a.1)  that the person consents to a judicial record verification by the Minister or a person mandated for that purpose; and

(b)  that the person undertakes to comply with the conditions of this Regulation.

O.C. 1297-2011, s. 10; O.C. 1184-2012, s. 10; O.C. 902-2014, s. 8.

11. When registering for the system, an emitter or participant that is not a natural person must also designate at least 2 and at most 5 natural persons having previously obtained an identifier in accordance with section 10 to act as account representatives and perform any operation within the system on its behalf. At least 1 of the representatives must be domiciled in Québec.

The emitter or participant must also identify, among the account representatives domiciled in Québec, a primary account representative who is the resource person to be contacted for any information concerning the emitter or participant.

For the purposes of the designation, the emitter or participant must provide the Minister with the following information and documents:

(1)  the name and contact information of the emitter or participant and of its chief officer or chief financial officer;

(2)  the name and contact information of the designated account representatives;

(3)  a declaration by the chief officer or chief financial officer or a resolution of the board of directors of the emitter or participant attesting that the account representatives have been duly designated to act on behalf of the emitter or participant for the purposes of this Regulation;

(4)  an attestation from a notary or advocate confirming the link between an account representative and the emitter or participant who designated the representative;

(5)  a declaration, signed by each of the account representatives, attesting that they have been duly designated for that purpose by the authorized representatives of the emitter or participant, that they accept the duties they have been assigned and that they undertake to comply with the conditions of this Regulation. The declaration must also indicate the name and contact information of any other emitter or participant on whose behalf the account representative acts for that purpose.

An emitter or participant that is not a natural person must have at least 2 account representatives at all times, including a primary account representative, at least one of whom is domiciled in Québec.

All representations, acts, errors or omissions made by the account representatives in the performance of their duties are deemed to be made by the emitter or participant.

The duties of the account representatives terminate when a request for revocation is received from the emitter or participant and, when an emitter or a participant has only 2 representatives, only after a new representative has been designated. The duties of the account representatives also terminate when all the accounts of the emitter or participant are closed.

If the participant is a natural person, any act that must be performed by an account representative pursuant to this Regulation must be performed by the participant.

O.C. 1297-2011, s. 11; O.C. 1184-2012, s. 10; O.C. 902-2014, s. 9.

12. An emitter or participant that is not a natural person may authorize up to 5 natural persons having previously obtained an identifier in accordance with section 10 or with the corresponding rules and regulations of a partner entity to act as account viewing agent to observe, within the electronic system, the operations involving the accounts of the emitter or participant.

For the purposes of the authorization, the emitter or participant must provide the following information and documents:

(1)  the name, contact information and account numbers of the emitter or participant;

(2)  the name and contact information of the authorized account viewing agents;

(3)  a declaration by the chief officer or chief financial officer or a resolution of the board of directors of the emitter or participant attesting that the account viewing agents are duly authorized to observe the account operations;

(4)  an attestation from a notary or advocate confirming the link between the account viewing agent and the emitter or participant that authorized the account viewing agent.

The authorization of an account viewing agent ends when a request for revocation is received from the emitter or participant or when all the accounts of the emitter or participant are closed.

O.C. 1297-2011, s. 12; O.C. 1184-2012, s. 10; O.C. 902-2014, s. 10.

13. No natural person applying for registration as a participant, and no person designated as an account representative or authorized as an account viewing agent, may have been found guilty, in the 5 years prior to the application for registration or the sending of the notice of designation or authorization, of fraud or any other criminal offence connected with the activities for which registration is requested or a notice is sent, or may have been found guilty on an offence under sections 28 to 31 of this Regulation or under a fiscal Act, the Derivatives Act (chapter I-14.01), the Securities Act (chapter V-1.1) or their regulations, unless a pardon has been obtained.

Every participant who is a natural person, every account representative and every account viewing agent who is found guilty of a criminal offence or an offence referred to in the first paragraph must inform the Minister of the conviction without delay, and the registration, designation or authorization of that natural person, account representative or account viewing agent will be terminated or revoked.

The emission allowances recorded in the account of a participant whose registration is terminated pursuant to the second paragraph are recovered by the Minister who allocates them as follows:

(1)  the emission units are paid into the auction account to be sold at a later date;

(2)  the early reduction credits are paid into the retirement account to be extinguished;

(3)  the offset credits are paid into the environmental integrity account.

This section applies to any conviction in a United States court for a criminal offence or offence referred to in the first paragraph that, had it been committed in Canada, could have led to criminal or penal proceedings.

O.C. 1297-2011, s. 13; O.C. 1184-2012, s. 10.

14. When an application for registration meets the requirements of sections 7 to 13, the Minister opens, in the electronic system,

(1)  for each emitter or participant, a general account in which the emission allowances that may be traded are recorded; and

(2)  for each emitter, a compliance account in which the emission allowances used to cover the GHG emissions of its covered establishments at the end of a compliance period must be recorded.

O.C. 1297-2011, s. 14; O.C. 1184-2012, s. 10; O.C. 902-2014, s. 11.

14.1. Any change to the information and documents provided pursuant to subparagraph 6 of section 10 or to section 11 must be communicated to the Minister without delay and, in the case of those provided pursuant to sections 7, 8 and 9, subparagraphs 1 to 5 and subparagraph 7 of section 10 or section 12, within 30 days from this amendment.

O.C. 1184-2012, s. 10; O.C. 902-2014, s. 12.

14.2. A participant whose account no longer contains any emission allowances may request that the Minister close the participant’s general account and cancel the participant’s registration by providing the following information:

(1)  the participant’s name and contact information;

(2)  the participant’s account number;

(3)  the participant’s signature or, if the participant is not a natural person, the signature of the participant’s chief officer or chief financial officer or a resolution of its board of directors, with the date of the request.

O.C. 1184-2012, s. 10.

15. An emitter may ask the Minister to close the emitter’s compliance account and transfer the emission allowances recorded in it to the emitter’s general account

(1)  if the emitter has not been required to cover the GHG emissions of any of its establishments pursuant to section 19 for over 5 years;

(2)  if the covered establishment is no longer operated by the emitter, the emitter operates no other covered establishments, and the emitter meets the conditions of section 17; or

(3)  if the emitter is closing a covered establishment, operates no other covered establishments and meets the conditions of section 18.

The emitter then becomes a participant for the purposes of this Regulation.

O.C. 1297-2011, s. 15.

16. When a participant’s general account has been inactive for at least 6 years and contains no emission allowances, the Minister notifies the participant of the situation and of the fact that the Minister may, after 30 days, close the account and terminate the participant’s registration if no emission allowance is placed in the account during that period or if the participant provides no valid reason for maintaining the account.

O.C. 1297-2011, s. 16.

17. When the operator of a covered establishment changes during a year, the emitter who previously operated the establishment must so notify the Minister as soon as possible.

The new operator becomes an emitter to which this Regulation applies and must, within 30 days of the change of operator, register for the system in accordance with this Chapter.

O.C. 1297-2011, s. 17.

18. An emitter that is permanently closing a covered establishment must, within 45 days of the date of the last emissions report filed in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), surrender to the Minister,

(1)  in accordance with section 46.10 of the Environment Quality Act (chapter Q-2), the same number of emission units as the number allocated without charge pursuant to Division II of Chapter II of Title III and issued on the basis of the estimated GHG emissions of the covered establishment, for the period after the operation of the covered establishment ceased, the surrendered units, if they have a vintage, must be of the year on which they were allocated or from previous years; and

(2)  any emission allowance needed to cover the GHG emissions of the covered establishment for the period during which it was operated.

For that purpose, the emitter must transfer into the emitter’s compliance account the emission units referred to in subparagraph 1 of the first paragraph to allow them to be paid into the Minister’s auction account and the emission allowances referred to in subparagraph 2 of the first paragraph to allow them to be deducted by the Minister and paid into the retirement account to be extinguished.

If the emitter fails to surrender emission allowances in accordance with this section,

(1)  if they are emission units referred to in subparagraph 1 of the first paragraph, the Minister deducts them from the emitter’s accounts; and

(2)  if they are emission allowances referred to in subparagraph 2 of the first paragraph, the Minister recovers them in accordance with section 22 and applies the administrative sanction provided for in that section.

O.C. 1297-2011, s. 18; O.C. 1184-2012, s. 11; O.C. 902-2014, s. 13.

CHAPTER II.1 REGISTRATION OF CLEARING HOUSES

O.C. 1089-2015, s. 9.

18.1. A clearing house for derivatives having an establishment in Canada, recognized by a regulatory authority responsible for supervising financial markets in Canada, may register for the system in order to clear transactions involving emission allowances. For that purpose, it must provide the Minister with the following information and documents:

(1)  its name and contact information, and the date and place of its constitution;

(2)  a list of its directors and officers and their work contact information;

(3)  a list of its subsidiaries or parent legal persons with a diagram representing the relations between those entities, including the control percentage between each entity;

(4)  a document issued by the regulatory authority supervising the clearing house confirming that fact and giving the date on which supervision started and the rules to be followed by the clearing house;

(5)  a declaration signed by the chief officer or a resolution of the board of directors of the clearing house including an undertaking to comply with the conditions of this Regulation and attesting that the information and documents provided are valid and that consent has been given to their communication when necessary for the purposes of this Regulation or the corresponding regulations of a partner entity.

O.C. 1089-2015, s. 9.

18.2. When registering for the system, the clearing house must also designate account representatives in accordance with section 11 that applies, with the necessary modifications.

It may also designate account viewing agents in accordance with section 12 that applies, with the necessary modifications.

Section 8.1 and subparagraphs 1, 2 and 2.1 of the first paragraph of section 9 also apply to the clearing house and sections 10 and 13 apply to its account representatives and account viewing agents, with the necessary modifications.

O.C. 1089-2015, s. 9.

18.3. When an application for registration meets the requirements of sections 18.1 and 18.2, the Minister opens a clearing house account for the clearing house in the electronic system.

O.C. 1089-2015, s. 9.

18.4. Any change to the information and documents provided under section 18.1 must be communicated to the Minister within 30 days and, if provided under section 18.2, immediately.

In addition, the clearing house must notify the Minister immediately if its activities are suspended by the regulatory authority that supervises it, or if supervision ceases. No transaction may be carried out in the account of the clearing house until the suspension has been lifted by the regulatory authority or until new supervision is established by the regulatory authority. If emission allowances are recorded in its account when supervision is suspended or ceases, they are returned to the emitter or participant who transfered them into the account.

O.C. 1089-2015, s. 9.

18.5. A clearing house may request the closure of its clearing house account in accordance with section 14.2, with the necessary modifications.

Section 16 also applies to an inactive clearing house account, with the necessary modifications.

O.C. 1089-2015, s. 9.

CHAPTER III COVERAGE OF GREENHOUSE GAS EMISSIONS

19. Every emitter to which this Regulation applies is required, in accordance with the terms and conditions of this Chapter, to cover each metric tonne CO2 equivalent of the verified emissions from an establishment or, if applicable, an enterprise referred to in section 2 when its GHG emissions are equal to or exceed the emissions threshold, until 31 December following the third consecutive emissions report for which the emissions from the establishment or enterprise are below the emissions threshold or, where applicable, following the permanent closure of the establishment or the permanent stop in production of a reference unit if the emissions attributable to the other activities of the establishment have been below the emissions threshold for the last 3 years.

The emitter is required to comply with the first paragraph

(1)  beginning with the compliance period starting on 1 January 2013, in the case of an emitter that on 1 January 2012 operates an establishment or, if applicable, an enterprise for which the reported emissions for 2009, 2010 or 2011, attributable to activities other than those referred to in subparagraph 2 of this paragraph, are equal to or exceed the emissions threshold;

(2)  beginning with the compliance period starting on 1 January 2015, in the case of the activities of an emitter referred to in subparagraph 2 of the second paragraph of section 2 whose verified emissions in connection with the fuel distributed for 2013 are equal to or exceed the emissions threshold;

(2.1)  beginning on 1 January 2016, in the case of an emitter for whom emissions attributable to fuel distribution activities in 2014 are equal to or exceed 25,000 metric tonnes CO2 equivalent;

(2.2)  beginning on 1 January 2016, in the case of an emitter for whom emissions attributable to fuel distribution activities in 2015 are equal to or exceed 25,000 metric tonnes CO2 equivalent;

(2.3)  beginning on 1 January 2016, in the case of an emitter who distributed 200 litres or more of fuel in 2015 but whose corresponding declared emissions are lower than 25,000 metric tonnes CO2 equivalent;

(3)  beginning on 1 January of the year following the year in which the first report of emissions that are equal to or exceed the threshold is submitted, in the case where the verified emissions of an emitter referred to in subparagraph 1 are equal to or exceed the emissions threshold during a year following the year mentioned in that subparagraph;

(3.1)  beginning on 1 January of the year concerned, in the case where fuel distribution activities of an emitter are equal to or exceed the emissions threshold for 2016 or a subsequent year;

(4)  beginning on 1 January of the year following the year in which the first report of verified emissions for an establishment, including a new facility, is submitted and includes the GHG emissions from the new facility, in the case of a new facility referred to in subparagraph a of paragraph 11 of section 3.

When the operator of a covered establishment changes, the new operator is required to cover all the GHG emissions from the establishment that have not been covered in accordance with this Chapter.

Notwithstanding subparagraphs 1 and 2 of the second paragraph, an emitter that ceases its activities permanently in the year preceding the year in which the compliance period referred to in those subparagraphs begins is not required to cover the emitter’s GHG emissions, provided it notifies the Minister in writing not later than 6 months following the start date of the period.

O.C. 1297-2011, s. 19; O.C. 1184-2012, s. 12; O.C. 1138-2013, s. 4; O.C. 902-2014, s. 14; O.C. 1089-2015, s. 10.

19.1. Where, on 1 August following the end of a compliance period, the verification report on the emissions report for 1 or more years of that compliance period does not allow to confirm in whole or in part the quantities of GHG emissions reported in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15) and the relative importance threshold referred to in subparagraph 1 of the first paragraph of section 6.7 of that Regulation is reached, the emitter is required for those years to cover the increased quantity of GHG emissions as follows:

Total increased quantity of GHG emissions = total GHG emissions reported × (1+ RUGHG)

Where

RUGHG = Relative uncertainty of GHG emissions reported, calculated in accordance with paragraph 7.5 of section 6.9 of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere.

Even if the emitter submits a verification report confirming compliance of the emissions report with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere after the date provided for in the first paragraph, the emission allowances corresponding to the difference between the total increased quantity of GHG emissions and the total quantity of GHG emissions verified once again may not be recovered.

O.C. 1089-2015, s. 11.

20. To be valid for the purpose of covering GHG emissions, the emission allowances used to cover GHG emissions must meet the requirements of section 37 and must not have been issued for a year after the compliance period, except for offset credits, which may be used if they were issued in the first year following the year of expiry of the compliance period.

In addition, the total quantity of offset credits that the emitter may use to cover the GHG emissions of its covered establishment cannot exceed 8% of the GHG emissions to be covered for the compliance period.

O.C. 1297-2011, s. 20; O.C. 1184-2012, s. 13; O.C. 902-2014, s. 15.

21. On 1 November following expiry of a compliance period or, if that day is not a business day, on the first following business day, at 8:00 p.m., every emitter must have at least as many emission allowances in its compliance account as its verified emissions and, where applicable, as the emissions increased in accordance with the first paragraph of section 19.1 for every covered establishment during the compliance period or, where applicable, during the years following the last compliance period for which emissions coverage was required.

The Minister deducts the required emission allowances in chronological order, from the least recent to the most recent according to their year of issue and vintage, in the following order:

(1)  offset credits, up to the limit provided for in the second paragraph of section 20;

(1.1)  emissions units from the Minister’s reserve account, using units from categories C, B and A, in that order;

(2)  early reduction credits;

(3)  emission units other than units referred to in subparagraph 1.1.

The emission allowances deducted by the Minister in accordance with this section are placed in the Minister’s retirement account and are extinguished.

O.C. 1297-2011, s. 21; O.C. 1184-2012, s. 14; O.C. 1138-2013, s. 5; O.C. 902-2014, s. 16; O.C. 1089-2015, s. 12.

22. A failure by an emitter to cover the GHG emissions of a covered establishment on the expiry of the compliance deadline leads to the suspension of its general account and the application of an administrative sanction equal to 3 emission units or early reduction credits for each missing emission allowance needed to complete the coverage.

The Minister recovers the missing emission allowances by deducting an equivalent number of valid emission allowances from the emitter’s general account in the manner provided for in the second paragraph of section 21.

The Minister also recovers the emission units and early reduction credits required for the administrative sanctions referred to in the first paragraph in the following manner and order, until all the units have been recovered:

(1)  the Minister deducts 3 valid emission units or early reduction credits from the emitter’s general account for each missing emission allowance using reserve units from categories C, B and A, early reduction credits and units identified by vintage from the least recent to the most recent, in that order;

(2)  the Minister deducts 3 emission units issued for a year following the compliance period, from the most recent to the least recent, from the emitter’s compliance account for each missing emission allowance;

(3)  the Minister deducts 3 emission units issued for a year following the compliance period, from the most recent to the least recent, from the emitter’s general account for each missing emission allowance.

When the emitter’s accounts do not contain enough emission allowances to recover all or part of the missing emission allowances as well as emission units and early reduction credits required for the application of the administrative sanction, the Minister notifies the emitter, who must surrender them within 30 days from the failure to provide coverage.

Upon a failure to comply, if the emitter is eligible for the allocation without charge of emission units, the Minister removes a quantity equivalent to the emission allowances, emission units and early reduction credits referred to in the fourth paragraph from the quantity that would normally have been allocated to the emitter without charge for the following compliance period pursuant to Division II of Chapter II of Title III.

O.C. 1297-2011, s. 22; O.C. 1184-2012, s. 15; O.C. 902-2014, s. 17.

23. Every missing emission allowance, recovered and deducted in accordance with section 22, is placed in the Minister’s retirement account to be extinguished.

The emission units deducted following the application of the administrative sanction provided for in that section are placed in the Minister’s auction account to be auctioned at a later date, and early reduction credits deducted are placed in the Minister’s retirement account to be extinguished.

Once these actions have been taken, the suspension of the emitter’s general account is lifted.

O.C. 1297-2011, s. 23; O.C. 902-2014, s. 18; O.C. 1089-2015, s. 13.

23.1. An emitter who, in accordance with section 6.5 of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), communicates a notice of correction to raise the quantity of GHG emissions reported in an emissions report filed in the previous 7 years must, for every compliance period that includes one of those years and for which the compliance deadline has expired, cover the GHG emissions that have not been covered by an equivalent number of additional emission allowances if the situation corresponds to one of the following criteria:

Criterion 1

[(GHGcorr - Allowancessurrendered)/ Allowancessurrendered] ≥ 0.05

Criterion 2

(GHGcorr - Allowancessurrendered) ≥ 5 000 metric tonnes CO2 equivalent

Where:

GHGcorr = Corrected GHG emissions, in metric tonnes CO2 equivalent;

Allowancessurrendered = Quantity of emission allowances surrendered for the compliance period to which the correction applies, expressed in metric tonnes CO2 equivalent.

Not later than 8:00 p.m. on the 180th day following the notice of correction or, if that day is not a business day, on the first following business day, the emitter must transfer into its compliance account the additional emission allowances, which must meet the following conditions:

(1)  emission allowances identified by vintage must be from the current year or a previous year;

(2)  the offset credits used, along with the offset credits already deducted for the compliance period during which the correction is recorded, must not exceed 8% of the GHG emissions to be covered for that period.

The Minister deducts the additional emission allowances required in the manner provided for in the second paragraph of section 21 and places them in the Minister’s retirement account to be extinguished.

If the additional emission allowances are not surrendered by the emitter in the time prescribed in the second paragraph, the provisions of sections 22 and 23 apply, with the necessary modifications.

No emission allowances will be reimbursed in the case of a notice of correction whose purpose is to reduce the emissions referred to in the first paragraph.

O.C. 902-2014, s. 19.

CHAPTER IV TRANSACTIONS OF EMISSION ALLOWANCES

O.C. 1297-2011, c. IV; O.C. 1184-2012, s. 16.

24. An emission allowance may be traded only between emitters, participants and clearing houses registered with the Minister or a partner entity.

An emitter or a participant may only hold emission allowances for their own use and not on behalf of another person having an interest in or control the emission allowances.

In addition, only emission allowances recorded in a general account may be traded. Subject to section 15, once recorded in a compliance account, emission allowances may only be used to cover GHG emissions.

O.C. 1297-2011, s. 24; O.C. 1184-2012, s. 17; O.C. 1089-2015, s. 14.

25. Every emitter or participant who wishes to trade emission allowances with another emitter or participant must follow the procedure established in section 26 and send the Minister a transaction request containing the following information:

(1)  the general account number of the seller;

(2)  the general account number of the buyer;

(3)  the quantity, type and, where applicable, vintage of the emission allowances to be traded;

(4)  the settlement price of each type and, where applicable, each vintage of emission allowances, as well as the method used to determine the settlement price;

(5)  the type of emissions trading agreement, the date of signing of the agreement and the agreed upon trading date;

(6)  where applicable, all other transactions or products covered by the agreement, a description of those transactions or products, and the name and contact information of the other parties involved.

Despite subparagraph 4 of the first paragraph, an emitter or participant is not required to disclose the settlement price of the emission allowances when the transaction is between related entities.

O.C. 1297-2011, s. 25; O.C. 1184-2012, s. 18; O.C. 1138-2013, s. 6; O.C. 902-2014, s. 20.

26. A transaction request for emission allowances must be proposed by one of the seller’s account representatives.

The transaction request is then submitted to all the seller’s other account representatives, for confirmation by one of them within 2 days of being submitted.

When the transaction request is confirmed, a notice is sent to all the seller’s account representatives and the request is submitted to the buyer’s account representatives, for acceptance by one of them within 3 days of the proposal of the transaction request.

Unless otherwise indicated by one of the account representatives or if the Minister has serious grounds to believe that an offence under this Regulation has been committed, once the transaction request has been accepted the emission allowances concerned by the request are transferred from the seller’s to the buyer’s general account.

At each step in the transaction request, the account representative concerned must attest to holding due authorization to complete the transaction for the emitter or participant, and that the information contained in the transaction request is true, accurate and complete.

The account representatives involved in the transaction of emission allowances must provide the Minister, on request and as soon as possible, with any additional information concerning the transaction.

O.C. 1297-2011, s. 26; O.C. 1184-2012, s. 18; O.C. 902-2014, s. 21.

26.1. Every emitter or participant who wishes to transfer emission allowances to a clearing house must, in accordance with the second paragraph, send the Minister a transaction request for the clearing house containing the following information:

(1)  the general account number of the seller;

(2)  the account number of the clearing house;

(3)  the quantity, type and, where applicable, vintage of the emission allowances to be traded;

(4)  the settlement price of each type and, where applicable, each vintage of emission allowances;

(5)  the type of emission allowances trading agreement and the transaction date scheduled;

(6)  where applicable, the codes of the exchange and of the contract.

The transaction request must be sent in accordance with the procedure established in section 26, with the necessary modifications, subject to the acceptance provided for in the third paragraph of that section which does not apply to that type of transaction.

O.C. 1089-2015, s. 15.

26.2. A clearing house that wishes to use emission allowances to compensate for a transaction must, in accordance with the procedure established in section 26.3, send the Minister an application for compensation containing the following information:

(1)  the account number of the clearing house;

(2)  the general account number of the emitter or participant who is compensated;

(3)  the quantity, type and, where applicable, vintage of the emission allowances used for compensation;

(4)  the settlement price of each type and, where applicable, each vintage of emission allowances;

(5)  the type of emission allowances trading agreement and the transaction date scheduled;

(6)  where applicable, the codes of the exchange and of the contract.

O.C. 1089-2015, s. 15.

26.3. An application for compensation must be proposed by one of the clearing house’s account representatives.

The application for compensation is then submitted to all the other account representatives at the clearing house for confirmation by one of them.

Once the application is confirmed, a notice to that effect is sent to all the account representatives and the emission allowances are transferred to the general account of the emitter or participant who is compensated.

The account representatives involved in an application for compensation of emission allowances must provide the Minister, on request and as soon as possible, with any additional information concerning the compensation.

O.C. 1089-2015, s. 15.

26.4. Emission allowances transferred to a clearing house account that are not used within 5 days for a transaction by an emitter or participant are returned to the seller.

O.C. 1089-2015, s. 15.

27. Every emitter or participant who wishes to carry out a transaction to transfer emission allowances from the emitter’s or participant’s general account to the emitter’s or participant’s compliance account or to retire from the system certain emission allowances recorded in the emitter’s or participant’s general account must send to the Minister a request including the following information:

(1)  the emitter’s or participant’s general and, where applicable, compliance account number;

(2)  the quantity, type and, where applicable, vintage of the emission allowances to be transferred or retired.

O.C. 1297-2011, s. 27; O.C. 1184-2012, s. 18; O.C. 1138-2013, s. 7.

27.1. A transfer or retirement request for emission allowances must be proposed by an account representative.

The transfer or retirement request is then submitted to all the other account representatives, for confirmation by one of them within 2 days of being submitted.

When the transfer or retirement request is confirmed, a notice is sent to all the emitter’s or participant’s account representatives.

Unless otherwise indicated by one of the account representatives or if the Minister has serious grounds to believe that an offence under this Regulation has been committed, once the transfer or retirement request has been confirmed the emission allowances concerned by the request are transferred from the emitter’s general account to the emitter’s compliance account, or from the emitter’s or participant’s general account to the Minister’s retirement account, where they are extinguished.

Account representatives who have sent a transfer or retirement request for emission allowances must provide the Minister, on request and as soon as possible, with any additional information concerning transfer or the retirement.

O.C. 1184-2012, s. 18; O.C. 1138-2013, s. 8; O.C. 902-2014, s. 22.

27.2. When a transaction cannot be completed because of an error or omission in connection with the information included in the request, because the request does not meet the requirements of one of sections 25 to 27.1, because an account does not contain enough emission allowances or because of any other reason, a notice is sent to the parties concerned within 5 working days following the failure to complete the transaction.

O.C. 1184-2012, s. 18; O.C. 1138-2013, s. 9; I.N. 2016-01-01 (NCCP).

28. No person holding privileged information on an emission allowance may trade that emission allowance, disclose the information or recommend that another person trade the emission allowance, except if the person has reason to believe that the information is known to the public or to the other party in the transaction.

However, the person may disclose the information or recommend that another person trade the emission allowance, if the person is required to disclose the information in the course of business, and if nothing leads the person to believe that the information will be used or disclosed in contravention of this section or section 29.

O.C. 1297-2011, s. 28.

29. No person prevented from trading an emission allowance pursuant to section 28 may use the privileged information in any other way, unless the person has reason to believe that the information is known to the public. In particular, the person may not carry out operations on futures contracts or other derivatives within the meaning of the Derivatives Act (chapter I-14.01) involving an emission allowance.

O.C. 1297-2011, s. 29.

30. A person with knowledge of material order information may not carry out or recommend that another person carry out a transaction involving an emission allowance, or disclose the information to any other person, except if

(1)  the person has reason to believe that the other person is already aware of the information;

(2)  the person must disclose the information in the course of business, and nothing leads the person to believe that it will be used or disclosed in contravention of this section;

(3)  the person carries out a transaction involving the emission allowances concerned by the information in order to perform a written obligation that the person contracted before becoming aware of the information.

For the purposes of this section, material order information is any information concerning an order to buy or an order to sell an emission allowance that could have a major impact on the price of an emission allowance.

O.C. 1297-2011, s. 30.

31. No person may disclose false or misleading information or information that must be filed pursuant to this Regulation, before it is filed, in order to carry out a transaction, in particular when it could influence the price of an emission allowance.

For the purposes of this section, false or misleading information is any information likely to mislead on an important fact, as well as the simple omission of an important fact; an important fact is any fact that may reasonably be believed to have a significant impact on the price or value of an emission allowance.

O.C. 1297-2011, s. 31.

32. The total number of emission units of the current or prior vintage, of emission units from the reserve account and of early reduction credits that an emitter or a participant may hold in its general account and, where applicable, its compliance account is subject to the holding limit calculated using equation 32-1:

Equation 32-1

HLi = 0.1 × Baseline + 0.025 × (Ci - Baseline)

Where:

HLi = Holding limit for year i;

0.1 = Maximum proportion of the number of emission units constituting the Baseline that an emitter or a participant may hold;

Baseline = 25,000,000;

0.025 = Maximum proportion of the number of emission units in excess of the Baseline that an emitter or a participant may hold;

Ci = Sum of the annual cap of emission units for year i set by order in accordance with section 46.7 of the Environment Quality Act (chapter Q-2) and the cap set by a partner entity;

i = Current year.

The total number of emission units of a vintage subsequent to the current year that an emitter or participant may hold in its general account and, where applicable, its compliance account is subject to the holding limit calculated using equation 32-2:

Equation 32-2

HLj = 0.1 × Baseline + 0.025 × (Cj - Baseline)

Where:

HLj = Holding limit for an emission unit of vintage j;

0.1 = Maximum proportion of the number of emission units constituting the Baseline that an emitter or participant may hold;

Baseline = 25,000,000;

0.025 = Maximum proportion of the number of emission units in excess of the Baseline that an emitter or participant may hold;

Cj = Sum of the annual cap of emission units for year j set by order in accordance with section 46.7 of the Environment Quality Act and of the cap set by a partner entity;

j = Year subsequent to the current year.

Despite the first paragraph, the emission units and early reduction credits recorded in the compliance account of an emitter and needed to cover estimated GHG emissions for the current year or emissions for preceding years are not subject to the holding limit.

Furthermore, an emitter or a participant that reaches or exceeds one-half of its holding limit must, at the Minister’s request, explain its strategy and the reason for holding the emission units concerned.

Every transaction request for emission units that would cause the buyer’s holding limit to be exceeded will be refused by the Minister.

When the holding limited is exceeded, the emitter or participant must, within 5 days after the limit is exceeded, divest itself of the excess emission allowances, pay into its compliance account the emissions units or early reduction credits needed to cover its emissions for the current year or preceding years or, in the case of related entities, amend the distribution of the overall holding limit determined in accordance with section 33 in order to become compliant. Upon a failure to comply, the Minister takes back a quantity of emission units equivalent to the excess emission allowances and pays them into the Minister’s auction account for sale at a later date.

O.C. 1297-2011, s. 32; O.C. 1184-2012, s. 19; O.C. 1138-2013, s. 10; O.C. 902-2014, s. 23.

33. For the purposes of the holding limit referred to in section 32, related entities are considered to be a single entity with an overall holding limit that they must distribute among themselves by allotting percentage shares.

The distribution must be disclosed to the Minister when the related entities register for the system in accordance with subparagraph 3 of the first paragraph of section 9 or, in the case of a new business relationship within the meaning of subparagraph 1 of the second paragraph of that section, within 30 days from the creation of that relationship. The information must, however, be sent to the Minister not more than 40 days before an auction when one of the related entities wishes to be registered as a bidder.

O.C. 1297-2011, s. 33; O.C. 1184-2012, s. 20.

34. The Minister may, on the Minister’s own initiative, correct any material error that occurs in an account in the system. The Minister must inform the parties concerned as soon as possible, stating the reasons for the correction.

O.C. 1297-2011, s. 34; O.C. 1089-2015, s. 16.

35. The Minister posts, at least once every year, on the website of the department, a list of all emitters, participants and clearing houses registered for the system as well as a summary of transactions conducted the previous year.

O.C. 1297-2011, s. 35; O.C. 1184-2012, s. 21; O.C. 902-2014, s. 24; O.C. 1089-2015, s. 17.

TITLE III EMISSION ALLOWANCES

CHAPTER I GENERAL

36. Emission allowances are issued in electronic form and identified in a way that allows them to be differentiated, in particular by type.

Reserve emission units are also identified according to the categories provided for in the first paragraph of section 58, whereas other emission units as well as offset credits are also identified by vintage.

O.C. 1297-2011, s. 36; O.C. 1184-2012, s. 22; O.C. 902-2014, s. 25.

37. The following emission allowances may be traded through the system and used for compliance purposes:

(1)  every emission unit and early reduction credit referred to in this Title;

(2)  every offset credit issued by the Minister pursuant to subparagraph 2 of the first paragraph of section 46.8 of the Environment Quality Act (chapter Q-2);

(3)  every emission allowance issued by a partner entity, according to the rules for the equivalent types of emission allowances issued under this Regulation, as indicated in Appendix B.1

Despite the first paragraph, the following emission allowances may not be traded or used for compliance purposes:

(1)  any emission allowance that has been suspended, cancelled or extinguished by the Minister or by a partner entity;

(2)  any emission allowance that has been used for compliance purposes under another cap-and-trade system for GHG emission allowances or GHG emissions reduction program.

O.C. 1297-2011, s. 37; O.C. 1184-2012, s. 23.

CHAPTER II GREENHOUSE GAS EMISSION UNITS

DIVISION I GENERAL

38. Based on the cap on emission units set by order in accordance with section 46.7 of the Environment Quality Act (chapter Q-2), the Minister places in the Minister’s reserve account a quantity of emission units that may be used in adjusting the allocation made without charge in accordance with Division II or may be sold by mutual agreement in accordance with Division IV of this Chapter.

The quantity of emission units represents

(1)  1% of the emission units available under the cap set for the years 2013 and 2014;

(2)  4% of the emission units available under the cap set for the years 2015 to 2017;

(3)  7% of the emission units available under the cap set for the years 2018 to 2020; and

(4)  4% of the emission units available under the cap set for the years 2021 and following.

The Minister places the unreserved emission units in the Minister’s allocation account. The units may be allocated without charge in accordance with Division II of this Chapter.

The emission units in excess of the total estimated quantities that may be allocated without charge for a given year are placed in the Minister’s auction account to be sold in accordance with Division III of this Chapter.

O.C. 1297-2011, s. 38.

DIVISION II ALLOCATION

39. An emitter operating a covered establishment and pursuing an activity referred to in Table A of Part I of Appendix C is eligible for the allocation of emission units without charge.

O.C. 1297-2011, s. 39.

40. The Minister estimates annually the total quantity of emission units that may be allocated without charge to an eligible emitter.

The estimated total quantity is calculated in accordance with Part II of Appendix C, using equation 1-1 and replacing the factor “PRi j” in equations 2-1, 2-9, 3-1, 3-10, 4-1, 4-8, 5-1 and 5-2, 6-2, 6-7, 6-8, 6-9, 6-12 and 6-13 by the factor “PRi j -2”, which corresponds to the total quantity of reference units produced or used in the year 2 years before the allocation year.

Despite equations 4-1 to 4-8 in Part II of Appendix C, if the only data available are data on emissions for the year in which an establishment became operational, the Minister uses those data to estimate the emission units allocated without charge for the first year.

On 1 May 2013 and on 14 January of every following year, or, if that day is not a working day, on the first following working day, the Minister issues the emission units corresponding to 75% of the total estimated quantity of emission units that may be allocated without charge, calculated in accordance with this section.

O.C. 1297-2011, s. 40; O.C. 1184-2012, s. 24; O.C. 1138-2013, s. 11; I.N. 2016-01-01 (NCCP).

41. After the filing of the emissions report for the year during which the issue referred to in the fourth paragraph of section 40 is made, an adjustment is made to the remaining 25% of the total estimated quantity of emission units that may be allocated without charge.

The Minister calculates the adjustment by subtracting the quantity of emission units issued from the actual total quantity of emission units that may be allocated without charge to an eligible emitter for the year covered by the emissions report, determined in accordance with Part II of Appendix C.

On 14 September of each year beginning in 2014 or, if that day is not a working day, on the first following working day, the Minister places, in the emitter’s general account, the quantity of emission units corresponding to any positive result of the adjustment calculation.

When the result of the adjustment calculation is negative, the Minister notifies the emitter who must, within 30 working days, place in its compliance account a quantity of emission units, of the vintage of the units allocated under the fourth paragraph of section 40 or of a prior vintage, equal to the excess quantity issued following the estimate made in accordance with that section; upon a failure to comply, the emission units are taken from the emitter’s general account. The emission units are then transferred to the Minister’s reserve account when units are required to be surrendered in accordance with the third paragraph of section 42, or transferred to the Minister’s auction account.

Upon a failure by the emitter to place the emission units in its compliance account within the time provided for in the fourth paragraph or to have enough emission units in the emitter’s general account, the Minister reduces the following allocation free of charge by an equivalent quantity of emission units.

O.C. 1297-2011, s. 41; O.C. 1184-2012, s. 25; O.C. 1089-2015, s. 18; I.N. 2016-01-01 (NCCP).

41.1. An emitter who, in accordance with section 6.5 of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), communicates a notice of correction to raise the number of reference units reported in an emissions report filed for a year in the current compliance period is allocated, during the next allocation of emission units, additional units equal to the difference between the quantity calculated for the first emissions report and the quantity calculated for the corrected emissions report in accordance with Part II of Appendix C.

No additional emission units are allocated for a notice of correction to an emissions report for a year in a compliance period for which the compliance deadline has expired.

O.C. 902-2014, s. 26.

41.2. Where, on 1 August following the end of a compliance period, the verification report on the emissions report for 1 or more years of that compliance period does not allow to confirm in whole or in part the quantity of reference units reported in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15) and the relative importance threshold referred to in subparagraph 2 of the first paragraph of section 6.7 of that Regulation is reached, the total allowance free of charge for those years is based on the adjusted value of the reported quantity of reference units, calculated as follows:

Total adjusted quantity of reference units = Total reported reference units × (1- RURU)

Where

RURU = Relative uncertainty of reported reference units, calculated in accordance with paragraph 7.5 of section 6.9 of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere.

Even if the emitter submits a verification report confirming compliance of the quantity of reported reference units with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere after the date provided for in the first paragraph, no emission unit will be allocated for a difference between the total adjusted quantity of reference units and the total quantity of reference units verified once again.

O.C. 1089-2015, s. 19.

42. The emission units allocated without charge in accordance with this Division are placed in the general account of the emitter.

The units come from the allocation account of the Minister or, if that account does not contain enough units, from the Minister’s reserve account using, in order, the Class C, B and A emission units as determined in section 58.

In the case of emission units from the reserve account referred to in the second paragraph, the category of emission unit is replaced by the same vintage of the allocation year. In addition, the reserve account is replenished using the emission units in excess of the total estimated quantity that may be allocated free of charge for a year that may be sold in accordance with Division III of this Chapter. The emission units paid into the reserve account in this way are identified as belonging to the category replenished.

O.C. 1297-2011, s. 42; O.C. 1184-2012, s. 26; O.C. 902-2014, s. 27.

43. The Minister may suspend the allocation of emission units without charge to any emitter that fails to comply with the provisions of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15) or with the provisions of this Regulation.

O.C. 1297-2011, s. 43.

44. In accordance with the second paragraph of section 46.8 of the Environment Quality Act (chapter Q-2), the Minister publishes in the Gazette officielle du Québec, not later than 1 December each year, the quantity of emission units to be issued to emitters without charge.

O.C. 1297-2011, s. 44; O.C. 1184-2012, s. 27.

DIVISION III AUCTION

45. The Minister auctions emission units in a specific place or online, at most 4 times per year.

At least 60 days before an auction, the Minister publishes a notice of auction on the website of the Ministère du Développement durable, de l’Environnement et des Parcs and, if the Minister considers it appropriate, in a newspaper or other publication, stating the rules set out in this Regulation and including, in particular, the following information:

(1)  the place or Internet address, the date and the time of the auction;

(2)  the terms and conditions for registering as a bidder;

(3)  the form of a bid, and the procedure for submitting a bid;

(4)  the procedure for the auction;

(5)  the number and vintage of the emission units to be auctioned and the composition of each lot;

(6)  the minimum settlement price for the units, set in accordance with the third paragraph of section 49 and, in the case of a joint auction with a partner entity, the minimum price set by that entity and the procedure used to set a joint minimum price set out in subparagraph 2 of the fourth paragraph of section 49.

O.C. 1297-2011, s. 45; O.C. 1184-2012, s. 28.

46. Every emitter or participant registered in the system, except an emitter or a participant whose accounts have been suspended or revoked for a reason other than a failure to cover the GHG emissions of a covered establishment, may take part in an auction of emission units.

For that purpose, the emitter or participant must, at least 30 days before the date of the auction, register with the Minister as a bidder by submitting the following information and documents:

(1)  the emitter or participant’s name, contact information and general account number;

(2)  if the emitter or participant is not a natural person, the names of its account representatives;

(3)  if the participant is a natural person, the person’s social insurance number;

(4)  the form of the financial guarantee that will be submitted pursuant to section 48.

Every emitter or participant registered as a bidder at an auction in accordance with the second paragraph remains registered for future auctions unless a cancellation of the registration is requested.

In all cases, an emitter or a participant must, at least 40 days before the date of each auction, send the Minister an update of the following information:

(1)  all information or documents required under section 7 concerning the identity, ownership, administration and structure of the emitter’s or participant’s establishment or enterprise;

(2)  the existence of any business relationship referred to in section 9;

(3)  the allocation of the purchasing limit among the related entities;

(4)  the allocation of the holding limit among the related entities.

Any change made to the information referred to in subparagraphs 3 and 4 of the fourth paragraph less than 30 days before the date of the auction, results in the the emitter or participant being refused participation in the auction.

O.C. 1297-2011, s. 46; O.C. 1184-2012, s. 29; O.C. 902-2014, s. 28; O.C. 1089-2015, s. 20.

47. The Minister may refuse to register an emitter or a participant for any auction if, when applying for registration for the system or for a previous auction or sale by mutual agreement, the emitter or participant provided false or misleading information, omitted to disclose information required by this Regulation, or contravened a rule of procedure for the auction or sale by mutual agreement.

O.C. 1297-2011, s. 47.

48. Every bidder must, at least 12 days before the date of the auction, submit a financial guarantee to the Minister.

The guarantee must be valid for a period of at least 26 days following the date of the auction and must be provided in the form of

(1)  bank transfer;

(1.1)  an irrevocable letter of credit issued by a bank constituted under the Bank Act or by a financial services cooperative constituted under the Act respecting financial services cooperatives;

(2)  a letter of guarantee issued by a bank constituted under the Bank Act or by a financial services cooperative constituted under the Act respecting financial services cooperatives;

(3)  (subparagraph revoked);

(4)  (subparagraph revoked).

Letters of credit and letters of guarantee provided in accordance with subparagraphs 1.1 and 2 of the second paragraph are deposited with the Minister of Finance, pursuant to the Act respecting deposits with the Bureau général de dépôts pour le Québec (chapter D-5.1).

The guarantee must be submitted in Canadian dollars. However, in the case of an auction for which the required guarantee is held jointly with a partner entity in the United States, the guarantee may also be submitted in US dollars.

If the Minister has delegated the administration of the financial services for the system in accordance with section 46.13 of the Environment Quality Act (chapitre Q-2), the financial guarantee must be made out to the delegatee and or, where applicable, the delagatee’s financial institution, and deposited with the delagatee or the financial institution.

O.C. 1297-2011, s. 48; O.C. 1184-2012, s. 30; O.C. 1138-2013, s. 12; O.C. 902-2014, s. 29; O.C. 1089-2015, s. 21.

49. The auction of emission units consists of a single round of bidding, using sealed bids.

Except for the last lot of emission units, which may consist of a lesser quantity, the emission units are auctioned in lots of 1,000 emission units of the same vintage when the units belong to the vintage for a subsequent year, and in lots of 1,000 emission units of various vintages when the units belong to the vintage for the current or a previous year and are sold in accordance with section 54.

The minimum price of the emission units is set

(1)  at $10 per emission unit, for auctions conducted in 2012;

(2)  for auctions conducted in any year after 2012, the price is set annually using the minimum price set for the previous year increased by 5% and adjusted in the manner provided for in section 83.3 of the Financial Administration Act (chapter A-6.001), as per the equation below:

MPt = MP(t-1) × (1 + 0.05 + Ir)

Where:

MPt = Minimum price set for a year;

MP(t-1) = Minimum price set for the previous year;

Ir = Indexation rate.

If the auction is conducted jointly with a partner entity,

(1)  the lots may contain emission units from each of the partner entities;

(2)  the joint minimum price of the emission units is the higher, on the day of the auction, of the price set under the third paragraph and the price set by the partner entity, at the official conversion rate of the Bank of Canada at noon on the date of the auction or, when that rate is not available, the most recent rate published in its Daily Memorandum of Exchange Rates.

A bid submitted at less than the minimum price set in accordance with the third and fourth paragraphs will be refused.

O.C. 1297-2011, s. 49; O.C. 1184-2012, s. 31; O.C. 1138-2013, s. 13; O.C. 902-2014, s. 30.

50. During an auction, the account representative of a bidder may submit more than one bid, subject to the terms and conditions specified in the notice published in accordance with the second paragraph of section 45, stating the quantity of lots requested and the price offered per emission unit in dollars and whole cents, provided the maximum amount of all the bidder’s bids does not exceed the amount of the guarantee submitted in accordance with section 48.

For the purposes of the first paragraph, the maximum amount of all a bidder’s bids is calculated as follows:

(1)  by determining, for each bid submitted by the bidder, the value of a lot by multiplying the price offered for the lot by the total quantity of bids submitted at that price or at a higher price;

(2)  the maximum amount of a bidder’s bids corresponds to the maximum value of the lots calculated under subparagraph 1.

The total quantity of emission units of the current or a prior vintage or of a vintage subsequent to the current year that may be purchased by the same bidder at each auction is, however, limited to:

(1)  25% of the units to be auctioned in the case of an emitter; and

(2)  4% of the units to be auctioned in the case of a participant.

Bidders that are related entities have an overall purchasing limit. However, the purchasing limit for a group of participants related to an emitter may not exceed 4%.

In accordance with subparagraph 3 of the first paragraph of section 9, the related entities must indicate to the Minister the allocation of the overall purchasing limit among the related entities, by percentage.

If the auction is conducted jointly with a partner entity, the bids must be submitted in the same currency as the financial guarantee submitted in accordance with section 48.

O.C. 1297-2011, s. 50; O.C. 1184-2012, s. 32; O.C. 1138-2013, s. 14; O.C. 902-2014, s. 31.

51. A bidder or participant must not disclose whether or not it is taking part in an auction, or any other confidential information relating to its participation in an auction, including:

(1)  its identity;

(2)  its bidding strategy;

(3)  the amount of its bids and the quantity of emission units concerned;

(4)  the financial information submitted to the Minister.

In addition, a bidder that retains the services of an advisor to develop its bidding strategy must send the Minister the name and contact information of the advisor, including the advisor’s home address. The bidder must ensure that the advisor does not disclose any of the information listed in the first paragraph and does not coordinate the bidding strategy of any other bidder.

O.C. 1297-2011, s. 51; O.C. 902-2014, s. 32.

52. At the close of the auction, when the total bids submitted by a bidder exceed that bidder’s holding limit determined in accordance with sections 32 and 33 or its purchase limit determined in accordance with section 50, the Minister removes from the bidder’s bids the quantity of excess lots, beginning with the lots awarded at the lowest price.

Notwithstanding the first paragraph, when an emitter’s total bid exceeds its holding limit but the number of emission units and early reduction credits in its compliance account is below the quantity referred to in the third paragraph of section 32, the emitter’s bids are accepted up to that quantity.

When a bid submitted by a bidder takes the maximum value of the bidder’s bids to beyond the amount of its financial guarantee submitted in accordance with section 48, the Minister removes the excess lots from the bid.

The lots removed pursuant to the third paragraph are then re-evaluated based on the prices offered in the bids submitted by all the bidders, by descending value, beginning with the price immediately below the price in the bid that exceeded the bidder’s guarantee. The lots are considered by the Minister to be new bids submitted by the bidder when, at a given price, the re-evaluation means that their maximum value does not exceed the amount of the financial guarantee submitted.

The Minister then awards emission units, beginning with the bidders that submitted the highest bids, until all available units have been awarded.

The final sale price per emission unit is, for all the emission units put up for auction, the lowest price bid for which the Minister awards units.

When more than 1 bid has been submitted at that price, and the total quantity of the bids is greater than the quantity of emission units available, the Minister divides the emission units between the bidders at that price

(1)  by establishing the share of each bidder by dividing the quantity of emission units requested by each bidder by the total quantity of units bid at that price;

(2)  by determining the number of emission units to be awarded to each bidder by multiplying the bidder’s share by the quantity of emission units available, rounding down to the nearest whole number;

(3)  when emission units remain to be awarded, by assigning a random number to each bidder and by awarding 1 emission unit per bidder, in ascending order of the numbers assigned, until all the emission units have been awarded.

When the auction is a joint auction, the final sale price is rounded off to the nearest cent of the reference currency used by the partner entities, using the application conversion rate.

O.C. 1297-2011, s. 52; O.C. 1184-2012, s. 33; O.C. 1138-2013, s. 15; O.C. 902-2014, s. 33.

53. Within 7 days after the results of the auction are sent to the bidders, every winning bidder must pay in full, by transfer, for the emission units awarded in accordance with section 52. If the financial guarantee has been submitted in the form provided for in subparagraph 1 of the second paragraph of section 48, the payment is withheld from the guarantee.

If the emission units are not paid for in full in the time prescribed under the first paragraph, the Minister withholds the amount owed from the financial guarantee provided in accordance with section 48. When more than one type of guarantee has been provided, the Minister uses the guarantees in the order set out in the second paragraph of that section.

Upon receiving payment from a winning bidder, made out to the Minister of Finance, or after applying all or part of a winning bidder’s guarantee used, the Minister records the emission units awarded in the bidder’s general account and, in the case referred to in the second paragraph of section 52, in the winning bidder’s compliance account.

All or part of a guarantee provided in accordance with section 48 that has not been used for the purposes of an auction is returned to the bidder.

The amounts collected during the auction are paid into the Green Fund established under the Act respecting the Ministère du Développement durable, de l’Environnement et des Parcs (chapter M‑30.001).

O.C. 1297-2011, s. 53; O.C. 1184-2012, s. 34; O.C. 1138-2013, s. 16; O.C. 902-2014, s. 34; S.Q. 2017, c. 4, s. 265.

54. Emission units of the vintage of the current or a previous year that remain unsold after an auction may be put up for sale as soon as the final sale price of the emission units has been above the minimum price for 2 auctions.

Emission units of the vintage of a year subsequent to the year of the auction are put up for sale again when their vintage becomes the vintage of the current year.

However, the quantity of emission units put up for sale again in accordance with the first paragraph cannot exceed 25% of the quantity of emission units initially planned for the auction.

O.C. 1297-2011, s. 54; O.C. 1184-2012, s. 34; O.C. 902-2014, s. 35.

55. The Minister publishes a summary of the auction within 45 days on the website of the Ministère du Développement durable, de l’Environnement et des Parcs, including the following information:

(1)  the names of the persons registered as bidders;

(2)  the settlement price of the emission units;

(3)  the total quantity and distribution of the units sold, in non-nominative form.

O.C. 1297-2011, s. 55.

DIVISION IV SALE BY MUTUAL AGREEMENT

56. Only emitters registered in the system in accordance with this Regulation, having a covered establishment in Québec and not holding emission units in their general account that can be used to cover GHG emissions for the current compliance period are eligible for a sale of emission units by mutual agreement in accordance with this Division.

O.C. 1297-2011, s. 56; O.C. 1184-2012, s. 35.

57. The Minister organizes a sale of emission units by mutual agreement in a determined place or online, at most 4 times per year.

At least 60 days before a sale by mutual agreement, the Minister publishes a notice of sale by mutual agreement on the website of the Ministère du Développement durable, de l’Environnement et des Parcs and, if the Minister considers it appropriate, in a newspaper or other publication, including the following information:

(1)  the place or Internet address, the date and the time of the sale by mutual agreement;

(2)  the terms and conditions for registering as a purchaser;

(3)  the form of an offer, and the procedure for submitting an offer;

(4)  the procedure for the sale by mutual agreement;

(5)  the number of emission units available for sale for each category;

(6)  the settlement price for the units.

O.C. 1297-2011, s. 57; O.C. 1184-2012, s. 36.

58. The emission units placed in the reserve account are divided equally into 3 categories and are sold at the following prices:

(1)  for reserve emission units in Category A, $40 per emission unit;

(2)  for reserve emission units in Category B, $45 per emission unit;

(3)  for reserve emission units in Category C, $50 per emission unit.

Beginning in 2014, the prices indicated in the first paragraph are increased annually by 5% and adjusted in the manner provided for in section 83.3 of the Financial Administration Act (chapter A-6.001).

O.C. 1297-2011, s. 58; O.C. 902-2014, s. 36.

59. Every emitter that wishes to purchase emission units at a sale by mutual agreement must, at least 30 days before the sale, register with the Minister as a purchaser by submitting the following information and documents:

(1)  the emitter’s name, contact information and compliance account number;

(2)  the names of the emitter’s account representatives;

(3)  a financial guarantee in Canadian dollars, valid for a period of at least 26 days following the date of the sale, in one of the forms referred to in the second paragraph of section 48.

An emitter registered as a purchaser at a sale by mutual agreement in accordance with the first paragraph remains registered for all following sales, unless the emitter applies for a cancellation of registration.

In all cases, an emitter must, at least 40 days before the date of each sale by mutual agreement, send the Minister an update of the following information:

(1)  all information or documents required under section 7 concerning the identity, ownership, administration and structure of the emitter’s establishment or enterprise;

(2)  the existence of any business relationship referred to in section 9;

(3)  the allocation of the holding limit among the related entities.

Any change is made to the information referred to in subparagraph 3 of the third paragraph less than 30 days before the date of the sale by mutual agreement, results in the the emitter being refused participation in the sale.

O.C. 1297-2011, s. 59; O.C. 1184-2012, s. 37; O.C. 1138-2013, s. 17; O.C. 902-2014, s. 37; O.C. 1089-2015, s. 22.

60. The Minister may refuse to register an emitter for a sale by mutual agreement if, when applying for registration for the system or for a previous sale by mutual agreement or auction, the emitter provided false or misleading information, omitted to disclose information required by this Regulation, or contravened a rule of procedure for the sale by mutual agreement or auction.

O.C. 1297-2011, s. 60.

60.1. The sale by mutual agreement takes place in a single round, using sealed offers.

The emission units are put on sale in lots of 1,000 units of the same category.

During a sale by mutual agreement, an emitter’s account representative may submit more than 1 offer, in Canadian dollars and in the form and using the procedure set out in the notice published in accordance with the second paragraph of section 57, indicating the number of lots requested in each category.

When the total offers submitted by a purchaser exceed the quantity of emission units put on sale or the purchaser’s holding limit determined in accordance with sections 32 and 33 or exceed the value of the financial guarantee submitted in accordance with subparagraph 3 of the first paragraph of section 59, the Minister removes from the purchaser’s offers the quantity of excess lots, beginning with the offers made at the lowest price.

O.C. 1184-2012, s. 38; O.C. 1138-2013, s. 18.

61. At the close of the sale by mutual agreement, the Minister sells the reserve emission units by allocating the units from categories A, B and C, in that order.

When the total number of offers to purchase for a category of reserve emission units is equal to or below the quantity of emission units available, the Minister allocates the emission units among the purchasers based on the offers received.

However, when the total of the offers to purchase for a given category is in excess of the quantity of emission units available, the Minister allocates the emission units

(1)  by establishing the share of each purchaser by dividing the quantity of emission units requested in their offer to purchase by the total of the offers to purchase for that category; and

(2)  by determining the number of emission units to be assigned to each purchaser by multiplying each purchaser’s share by the quantity of emission units available, rounding down to the nearest whole number;

(3)  when emission units remain to be awarded, by assigning a random number to each purchaser and by awarding 1 emission unit per purchaser, in ascending order of the numbers assigned, until all the emission units have been awarded.

O.C. 1297-2011, s. 61; O.C. 1184-2012, s. 39; O.C. 902-2014, s. 38.

62. Within 7 days after the results of the sale are sent to the purchasers, every purchaser must pay in full, by transfer, for the emission units awarded in accordance with section 61. If the financial guarantee submitted in accordance with subparagraph 3 of the first paragraph of section 59 was in the form provided for in subparagraph 1 of the second paragraph of section 48, the payment is withheld from the guarantee.

If the emission units are not paid for in full in the time prescribed under the first paragraph, the Minister withholds the amount owed from the financial guarantee provided in accordance with subparagraph 3 of the first paragraph of section 59. When more than one type of guarantee has been provided, the Minister uses the guarantees in the order set out in the second paragraph of section 48.

Upon receiving payment from a purchaser, made out to the Minister of Finance, or after applying all or part of a purchaser’s guarantee, the Minister records the emission units sold in the purchaser’s compliance account.

The amounts collected during a sale by mutual agreement are paid into the Green Fund established under the Act respecting the Ministère du Développement durable, de l’Environnement et des Parcs (chapter M‑30.001).

O.C. 1297-2011, s. 62; O.C. 1184-2012, s. 40; O.C. 1138-2013, s. 19; S.Q. 2017, c. 4, s. 266.

63. All or part of a guarantee provided in accordance with subparagraph 3 of the first paragraph of section 59 that has not been used for the purposes of a sale by mutual agreement is returned to the purchaser.

O.C. 1297-2011, s. 63; O.C. 1184-2012, s. 41.

64. Emission units that remain unsold after a sale by mutual agreement are retained for a sale at a later date.

O.C. 1297-2011, s. 64.

64.1. The Minister publishes a summary of the sale by mutual agreement within 45 days on the website of the Ministère du Développement durable, de l’Environnement, de la Faune et des Parcs, including the following information:

(1)  the names of the persons registered as purchasers;

(2)  the settlement price of the emission units;

(3)  the total quantity and distribution of the units sold, in non-nominative form.

O.C. 1138-2013, s. 20.

CHAPTER III EARLY REDUCTION CREDITS

65. Reductions in GHG emissions made during the eligibility period starting on 1 January 2008 and ending on 31 December 2011 are eligible for early reduction credits.

The period during which the reductions are recorded, hereafter referred to as the reduction period, must correspond to the 4 full calendar years of the eligibility period or must have started on 1 January 2009, 2010 or 2011 and ended without interruption on 31 December 2011.

The reference period used to determine reductions in GHG emissions runs from 1 January 2005 to 31 December 2007, inclusively.

O.C. 1297-2011, s. 65.

66. Every emitter referred to in the first paragraph of section 2 that is required to cover its GHG emissions starting with the compliance period starting on 1 January 2013 is eligible for early reduction credits if the reductions

(1)  result directly from an action or decision of the emitter and began during the eligibility period determined in the first paragraph of section 65;

(2)  are made in one of the emitter’s covered establishments;

(3)  reduce the GHG emissions that the emitter is required to cover pursuant to section 19;

(4)  belong to and can be demonstrated by the emitter;

(5)  are calculated using the same calculation method and the same factors for each of the years 2005 to 2011;

(6)  represent at least 1 metric tonne CO2 equivalent;

(7)  do not result from a decrease in production or the closure of an establishment, or from an increase in GHG emissions at another establishment located in Québec or elsewhere;

(8)  are voluntary, meaning that they were not made in response to a legislative or regulatory provision, a permit or another type of authorization;

(9)  are permanent and irreversible;

(10)  are additional, meaning that they meet the following conditions:

(a)  the average annual GHG emissions of the establishment during the reduction period are below those of the reference period;

(b)  the average intensity compared to at least 1 reference unit referred to in Table B of Part I of Appendix C during the reduction period, calculated using equation 66-1 below, is below the average intensity for the reference period, calculated using equation 66-2:

Equation 66-1

Equation 66-2

Where:

I Reduction j = Average intensity of GHG emissions for reference unit j during the reduction period;

I Reference j = Average intensity of GHG emissions for reference unit j during the reference period;

j = Reference unit for the establishment referred to in Table B of Part I of Appendix C;

GHGij = GHG emissions of the establishment, relating to the production or use of reference unit j for year i, in metric tonnes CO2 equivalent;

i = Year;

n = First year of the reduction period;

Pij = Annual quantity of reference units j produced or used by the establishment for year i;

(11)  are verifiable; and

(12)  have not been credited or financed, in whole or in part, under another cap-and-trade system for GHG emission allowances or a reduction program for GHG emissions.

However, reductions in GHG emissions resulting from on-site transportation activities and the sequestration of GHG emissions are not eligible for early reduction credits.

O.C. 1297-2011, s. 66; O.C. 1184-2012, s. 42.

67. In addition to the conditions set out in sections 65 and 66, to be eligible for early reduction credits, a reduction resulting from a project to substitute a low-GHG fuel for a fuel must also meet one of the following conditions:

(1)  the average purchase cost of the substitute fuel or combustible paid by the emitter during the reduction period must be higher than the average cost of the fuel substituted during the reduction period;

(2)  the emitter must have made an investment, other than an equipment maintenance investment, to modify or replace equipment in order to substitute the fuel during the eligibility period.

O.C. 1297-2011, s. 67.

68. An emitter that wishes to be issued early reduction credits must send the Minister, not later than 31 May 2013, an application containing the following information and documents:

(1)  the emitter’s name, contact information and account numbers;

(2)  a description of the activities pursued at the emitter’s establishment where the reductions have occurred;

(3)  a description of the reduction project and proof that it meets the conditions set out in sections 65 to 67;

(4)  the dates of the reduction period during which the reductions in GHG emissions occurred;

(5)  the quantity of the GHG emission reduction, in metric tonnes CO2 equivalent, calculated using one of the following methods:

(a)  one of the calculation methods provided for in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15);

(b)  a mass balance calculation method, or a method recognized by the industry and meeting the requirements of the ISO 14064-2 standard;

(6)  all the information and documents used to calculate GHG emissions in accordance with paragraph 5;

(7)  a verification report on the project and the reductions, carried out by an organization accredited to ISO 14065 by a member of the International Accreditation Forum under an ISO 17011 program, confirming a reasonable level of assurance under the ISO 14064-3 standard that the reduction meets the conditions of this Chapter;

(8)  the information needed to calculate the maximum quantity of early reduction credits provided for in section 69;

(9)  the signature of the chief officer of the emitter and the date of the application.

O.C. 1297-2011, s. 68; O.C. 1184-2012, s. 43.

69. The maximum quantity of early reduction credits that may be issued to an emitter that meets the requirements of this Chapter is calculated using equations 69-1 to 69-5:

Equation 69-1

Where:

ERC max = Maximum quantity of early reduction credits that may be issued;

NY = Number of calendar years included in the reduction period;

k = Total number of reference units of the establishment referred to in Table B of Part I of Appendix C;

j = Reference unit;

E Reference (j) = Average annual GHG emissions resulting from the production or use of reference unit j during the reference period, calculated using equation 69-2, in metric tonnes CO2 equivalent;

E Reduction (j) = Average annual GHG emissions resulting from the production or use of reference unit j during the reduction period, calculated using equation 69-3, in metric tonnes CO2 equivalent;

P j = - 1 if P Reference (j) ≤ P Reduction (j);

- (P Reduction (j) /P Reference (j) if P Reference (j) > P Reduction (j);

Where: P Reference (j) = Average annual quantity of reference units j produced or used during the reference period, calculated using equation 69-4;

P Reduction (j) = Average annual quantity of reference units j produced or used during the reduction period, calculated using equation 69-5.

Equation 69-2

Where:

E Reference (j) = Average annual GHG emissions resulting from the production or use of reference unit j during the reference period, in metric tonnes CO2 equivalent;

E i j = GHG emissions resulting from the production or use of reference unit j for year i, in metric tonnes CO2 equivalent;

j = Reference unit;

i = Each year included in the reference period, namely 2005, 2006 or 2007;

Equation 69-3

Where:

E Reduction (j) = Average annual GHG emissions resulting from the production or use of reference unit j during the reduction period, in metric tonnes CO2 equivalent;

E i j = GHG emissions resulting from the production or use of reference unit j for year i, in metric tonnes CO2 equivalent;

i = Each year included in the reduction period, namely 2008, 2009, 2010 and 2011;

j = Reference unit;

m = Year in which the reduction period begins;

n = Number of consecutive years in the reduction period;

Equation 69-4

Where:

P Reference (j) = Average annual quantity of reference units produced or used during the reference period;

P i j = Quantity of reference units produced or used during year i;

i = Each year included in the reference period, namely 2005, 2006 or 2007;

j = Reference unit;

Equation 69-5

Where:

P Reduction (j) = Average annual quantity of reference units produced or used during the reduction period;

P i j = Quantity of reference units produced or used during year i;

i = Each year included in the reduction period, namely 2008, 2009, 2010 or 2011;

j = Reference unit;

m = Year in which the reduction period begins;

n = Number of consecutive years in the reduction period.

O.C. 1297-2011, s. 69.

70. The Minister issues, to every emitter that meets the conditions of this Chapter, a quantity of early reduction credits corresponding to the lesser of

(1)  the quantity calculated in accordance with section 69; and

(2)  the quantity corresponding to the reductions that meet the conditions of this Chapter.

The credits are issued to the emitter’s general account by the Minister not later than 14 January 2014.

O.C. 1297-2011, s. 70; O.C. 1184-2012, s. 44.

CHAPTER IV OFFSET CREDITS

O.C. 1184-2012, s. 45.

70.1. The Minister keeps and publishes, on the website of the Ministère du Développement durable, de l’Environnement, de la Faune et des Parcs, a public register of registered offset credit projects that contains the names and professional contact information of promoters, the name of the promoter’s enterprise, information related to the project submitted with the application for registration, project reports and verification reports submitted in accordance with this Chapter, and information on project status.

O.C. 1138-2013, s. 21; O.C. 902-2014, s. 39.

70.2. GHG emission reduction projects referred to in a protocol appearing in Appendix D, that began on or after 1 January 2007, are eligible for the issue of offset credits.

Subject to any specific period provided for in a protocol, an offset credit project may be conducted during a continuous period of not more than 10 years.

At the expiry of that period, the promoter may, in accordance with this Chapter, request the renewal of the offset credit project, for the period applicable to this type of project, when the project still meets the conditions of section 70.3.

For the purposes of this Chapter, an offset credit project is considered to begin on the date of the first reductions in GHG emissions resulting from the project.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 40.

70.3. An offset credit project must meet the following conditions:

(1)  it must be carried out by a promoter registered for the system in accordance with section 70.4, and the reductions in GHG emissions must result directly from an action or decision by the promoter;

(2)  it must be carried out in accordance with the applicable protocol appearing in Appendix D and meet the specified conditions;

(3)  the reductions in GHG emissions resulting from the project must belong to the promoter, and the promoter must be able to demonstrate that fact;

(4)  the reductions in GHG emissions must occur only within the boundaries of the project site and with regard to the GHG sources, sinks and reservoirs targeted by the project;

(5)  the reductions in GHG emissions must be permanent and irreversible;

(6)  the reductions in GHG emissions must be additional, that is that they meet the following conditions:

(a)  they must result from a project that is voluntary, that is that it is not being carried out, at the time or registration of renewal, in response to a legislative or regulatory provision, a permit or other type of authorization, an order made under an Act or regulation, or a court decision;

(b)  they must result from a project that goes beyond the current practices described in the applicable protocol for the project;

(7)  the reductions in GHG emissions for which offset credits are requested have not already received credit under this Regulation or another GHG emission reduction program;

(8)  the project must take place in a territory and geographic zone covered by the applicable protocol;

(9)  the GHG emission reductions must amount to at least 1 metric tonne CO2 equivalent;

(10)  the GHG emission reductions must be calculated in accordance with the methods prescribed in the applicable protocol listed in Appendix D, taking into account all adjacent GHG sources, sinks and reservoirs;

(11)  the GHG reductions resulting from the project must not be wholly or partly compensated by increases in GHG emissions occurring outside the boundaries of the project;

(12)  the reduced GHG emissions must be verifiable, that is that they can be objectively assessed by a verifier in accordance with this Chapter;

(13)  the activities carried out under the project must meet all the applicable requirements for the type of project and the place where it is carried out.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 41.

70.4. Only an emitter or participant person domiciled in Québec, in the case of a natural person, or having an establishment in Québec, in other cases, may act as the promoter of an offset credit project.

O.C. 1184-2012, s. 45.

70.5. A promoter wishing to be issued offset credits for a project must, not later than 18 months after the project begins but not exceeding the date of submission of the first report for the project referred to in the second paragraph, apply to the Minister for the project to be registered in the register of offset credit projects by submitting the promoter’s name and professional contact information, the name of the promoter’s enterprise, the promoter’s account numbers and the following project information:

(1)  where applicable, the name and contact information of the person responsible for the promoter’s activities;

(2)  the title and a summary description of the project;

(3)  the protocol applicable to the project, referred to in Appendix D;

(4)  if the application is for a new project or is an application for renewal;

(5)  if the application is for a single project and, if so, the location of the project site;

(6)  if the application is for an aggregation of projects and, if so, the number of projects involved;

(7)  an estimate of the annual and total GHG emissions to be reduced in accordance with this Regulation and the applicable protocol, in metric tonnes CO2 equivalent;

(8)  the duration of the project and the estimated project commencement date;

(9)  the signature of the promoter and the date of the application for registration as well as a declaration attesting that the information provided is accurate.

Not later than 18 months after the project begins, the promoter must submit a first project report to the Minister covering the first project reporting period, complying with sections 70.14 to 70.19 and including, in addition to those stipulated in section 70.14, the following information and documents:

(1)  (subparagraph revoked);

(2)  the title and a detailed description of the project;

(3)  the protocol applicable to the project, listed in Appendix D;

(4)  (subparagraph revoked);

(5)  a description of the places where the project is carried out, including the geographic boundaries and the latitude and longitude of each project site;

(6)  for each site, the GHG sources, sinks and reservoirs targeted by the project;

(7)  when the environmental impacts have been assessed, a copy of the assessment and its conclusions;

(8)  (subparagraph revoked);

(9)  a copy of any authorization required for the project;

(10)  a demonstration that the project meets the conditions of section 70.3, including a copy of any relevant document;

(11)  (subparagraph revoked);

(12)  a data surveillance and management plan meeting the requirements of the protocol applicable to the project;

(13)  a description of the measures taken to ensure compliance with the requirements of this Regulation;

(14)  (subparagraph revoked);

(15)  (subparagraph revoked).

Despite the first paragraph, in the case of an offset credit project that commenced before a protocol applicable to that type of project was listed in Appendix D, the promoter must send the application for registration to the Minister not later than 3 years after the date of coming into force of the relevant protocol.

O.C. 1184-2012, s. 45; O.C. 1138-2013, s. 22; O.C. 902-2014, s. 42.

70.6. The first project report referred to in the second paragraph of section 70.5 must include a declaration from the promoter attesting

(1)  that the promoter is the sole owner of the GHG emission reductions resulting from the project; if several parties are involved in the project, a copy of an agreement indicating that the parties have transferred their rights with respect to the reductions to the promoter must be included; and

(2)  that the promoter has not applied for credits for the GHG emission reductions targeted by the project under another GHG emission reduction program, and will not make such an application once the project is registered.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 43.

70.7. A promoter may carry out an aggregation of the projects of the same type on several sites for various members of the aggregation when each project meets the conditions of sections 70.2 and 70.3 and of the protocol applicable to the project.

The application for registration referred to in the first paragraph of section 70.5 must, in such a case, also include the list of members of the aggregation for which the project is carried out and their contact information, and the first project report for the aggregation of offset credit projects must include

(1)  for each project, the information and documents referred to in the second paragraph of section 70.5;

(2)  (subparagraph revoked); and

(3)  a declaration signed by each member party to the aggregation attesting that the promoter is duly designated to carry out the project and authorizing the issue of the offset credits to the promoter for the aggregation.

The project commencing first is considered to be the reference project for the application, to the aggregation of projects, of the time limits for renewal set out in section 70.10 and for the project report referred to in section 70.14.

The provisions of this Regulation concerning offset credit projects apply, with the necessary modifications, to an aggregation of projects.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 44.

70.8. A promoter may add a project to an aggregation of projects after it has been registered if the project meets the conditions set out in the first paragraph of section 70.7. The promoter must, in such as case, submit to the Minister the information and documents referred to in the second paragraph of that section that relate to the additional project, and the project report submitted immediately after the project is added must include, for the added project, the information and documents referred to in the second paragraph of section 70.5.

Every project added to an aggregation of projects is subject to the same time limits as those determined for the aggregation in accordance with the third paragraph of section 70.7 with respect to renewal and the project report.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 45.

70.9. (Revoked).

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 46.

70.10. Every promoter wishing to renew an offset credit project must, not more than 18 months prior to the end date for the current project but not less than 9 months prior to that date, send to the Minister an application for renewal including the information and documents referred to in sections 70.3 to 70.8.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 47.

70.11. Where an application for registration is submitted for a project in accordance with the first paragraph of section 70.5, the Minister registers the project in the register of offset credit projects.

O.C. 1184-2012, s. 45; O.C. 1138-2013, s. 23; O.C. 902-2014, s. 48.

70.12. Subject to any specific period prescribed in a protocol appearing in Appendix D, the reductions in GHG emissions resulting from an offset credit project must begin not later than 2 years after the project is registered, on pain of removal from the register.

The promoter must implement the offset credit project in accordance with this Regulation, the applicable protocol listed in Appendix D and the first project report submitted in accordance with the second paragraph of section 70.5.

The promoter must also use any device, system or other equipment required under the protocol applicable to the project, and ensure that they are maintained in good working order, work reliably for the duration of the project, and are calibrated in the manner and at the frequency specified by the equipment manufacturer or, where applicable, by the protocol applicable to the project.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 49.

70.13. Every promoter must also, for each project, record the following information annually in a register:

(1)  the information referred to in the second paragraph of section 70.14;

(2)  any information concerning the geographic boundaries of the project and any GHG source, sink or reservoir concerned by the project;

(3)  a calculation of emissions under the baseline scenario for the project, emissions during project implementation and emission reductions, along with the related documentation;

(4)  the quantity and type of fuels used and any data measured, sampled or used to calculate emissions under the baseline scenario for the project, emissions during project implementation and emission reductions, for each emission source, and the type of process and equipment used;

(5)  where applicable, the point of origin and chain of traceability of the documents required by the protocol applicable to the project;

(6)  information concerning any chemical analysis conducted, any results, and any documentation relating to the testing of any equipment and sources used to calculate emissions under the baseline scenario, emissions during project implementation and emission reductions from the project;

(7)  any data or documentation that must be recorded under the protocol applicable to the project.

O.C. 1184-2012, s. 45.

70.14. Each full year from the start date of a project or, for the projects referred to in the third paragraph of section 70.5, from the date of registration, constitutes a project reporting period.

Every project promoter must, not later than 6 months after the end of each project reporting period, submit a project report to the Minister covering the most recent project reporting period and including the following information and documents:

(1)  the promoter’s name and contact information and, where applicable, the names and contact information of the members party to the aggregation;

(2)  the start and end dates for the project reporting period covered by the report;

(3)  the quantity of GHG emission reductions during the period covered by the project report, calculated using the methods set out in the applicable protocol, in metric tonnes CO2 equivalent, and all the information and documents used for the calculation;

(4)  the calculation, surveillance and monitoring methods for the data used, and the data monitored;

(5)  the quantity of GHG emission reductions eligible for the issue of offset credits according to the conditions of this Regulation and the protocol applicable to the project, in metric tonnes CO2 equivalent;

(6)  information or document required by the protocol applicable to the project;

(7)  a demonstration that the project has been carried out in accordance with this Regulation;

(8)  a declaration signed by the promoter attesting that

(a)  the project is still being carried out in conformity with the rules applicable to the type of project and the place where it is carried out;

(b)  the promoter still owns the GHG emission reductions for which the offset credits are requested;

(c)  the GHG emission reductions have not been used to apply for credits under another program; and

(d)  the information and documents provided are complete and accurate;

(8.1)  any information relating to financial assistance received for the project under a GHG emission reduction program;

(9)  a comparison with the previous project report and, where applicable, a description of any changes made;

(10)  the date of the report.

In the case of a project referred to in the third paragraph of section 70.5, the promoter must, not later than 6 months after the date of registration, submit to the Minister a project report including the information and documents listed in the second paragraph of this section, covering the whole period beginning on or after 1 January 2007 and ending on the date of registration.

Despite the second paragraph, if, for a single project or for each project in an aggregation of projects, GHG emission reductions of less than 25,000 metric tonnes CO2 equivalent have been achieved during a period covered by a project report, the promoter may postpone the submission of the project report for that period to the following year, provided the promoter notifies the Minister in writing within the time prescribed in the second paragraph. The promoter must, however, submit a project report every 2 years and the information must be presented separately for each project reporting period.

If a project report is not submitted within the required time, the GHG emission reductions calculated and reported in the project report will not be eligible for the issue of offset credits.

In the case of an aggregation of offset credit projects, a single project report may be submitted by the promoter, but the report must contain the information and documents referred to in the second paragraph for each project.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 50.

70.15. Every project report referred to in section 70.14 must be accompanied by a verification report conducted by a verification organization accredited under ISO 14065 by a member of the International Accreditation Forum in Canada or the United States and according to an ISO 17011 program, with respect to the sector of activity for the project.

In addition, the promoter must entrust the verification of the project report to a verification organization and a verifier designated by that organization that, in addition,

(1)  has not acted, in the 3 preceding years, as a consultant for the purpose of developing the project or calculating the reductions in GHG emissions attributable to the project for the promoter or, as applicable, for one of the member parties to the aggregation;

(2)  (subparagraph revoked);

(3)  has not verified more than 6 consecutive project reports for the project on behalf of the promoter; and

(4)  when the promoter wishes to have the project report verified by a verification organization or a verifier other than one that verified the report for the preceding year, the organization or verifier must not have verified the report for the project during the 3 previous years.

For the verification, the promoter and, as applicable, the members party to the aggregation must give the verifier access to all the information needed and to the places where the project is carried out.

Despite the first paragraph, until 31 December 2017, a verification report of a project report may be conducted by a verification organization in the process of being accredited, on the condition that the organization receives accreditation in the year following the verification of the project.

If the organization fails to receive accreditation within the time prescribed in the fourth paragraph, the promoter must, not later than 6 months after the end of the prescribed time, send the Minister a new verification report on its project report, conducted by an accredited organization in accordance with the first paragraph.

No offset credits may be issued for the year covered by a verification report of a project report until the organization has been accredited.

O.C. 1184-2012, s. 45; O.C. 1138-2013, s. 24; O.C. 902-2014, s. 51.

70.16. The verification of the project report must

(1)  be conducted in accordance with ISO 14064-3 and according to procedures that allow a reasonable assurance level within the meaning of that standard to be obtained; and

(2)  include at least one project site visit by the verifier designated by the verification organization and accompanied by the promoter and, where applicable, the member party to the aggregation concerned, during each verification for each place concerned by the project.

O.C. 1184-2012, s. 45.

70.17. In addition to the information prescribed by ISO 14064-3 and ISO 14065, the verification report referred to in section 70.15 must include the following information and documents:

(1)  the name and contact information of the verification organization and of the verifier designated by the organization to conduct the verification and, where applicable, of the members of the verifier’s team;

(2)  the name and contact information of the member of the International Accreditation Forum that accredited the verification organization, and the date of the accreditation;

(2.1)  a description of the activities executed by the verifier to ensure the project complies with this Regulation;

(3)  the dates of the periods during which the verification was conducted, and the date of any project site visits;

(4)  an assessment of the accuracy, completeness and conformity of the project report;

(5)  a description of any error, omission or inaccuracy noted in the project report or relating to the data, information or methods used, and their impact on the project and on the percentage of error referred to in subparagraph 6;

(6)  the percentage of error for the project report, calculated in accordance with section 70.18;

(7)  where applicable, the corrections made to the project report following the verification;

(8)  the total quantity of CO2 equivalent GHG emission reductions over the period of the project report and the quantity of GHG emission reductions eligible for the issue of offset credits under the conditions of this Regulation and the protocol applicable to the project, in metric tonnes CO2 equivalent;

(9)  the conclusions of the verification concerning the accuracy and reliability of the project report and its conformity with the conditions of this Regulation;

(10)  a declaration by the verification organization and the verifier that the verification was conducted in accordance with this Regulation.

In the case of an aggregation of offset credit projects, a single verification report may be submitted by the promoter, but the report must contain the information and documents referred to in the first paragraph for each project, and the verification of each project.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 52.

70.18. The percentage of error of the project report is calculated using the following equation:

Equation 70.18-1

Where:

PE = Percentage of error;

DRV = Discrepancy between the reductions in GHG emissions reported by the promoter and the verified reductions, in metric tonnes CO2 equivalent;

RR = Reductions in GHG emissions reported by the promoter, in metric tonnes CO2 equivalent.

O.C. 1184-2012, s. 45.

70.19. A verification report of a project report is deemed positive if the verifier can attest with reasonable assurance that the percentage of error committed in applying quantification, surveillance or measurement conditions, calculated in accordance with section 70.18, is not above 5% and that the other conditions of this Regulation are met.

When the percentage of error calculated in accordance with section 70.18 is above 5%, the promoter must correct the project report and submit it again for verification before sending it to the Minister.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 53.

70.20. Subject to any specific proportion set out in a protocol appearing in Appendix D, following the receipt of a project report that has a positive verification result and meets the conditions of this Regulation, the Minister places in the general account of the promoter of the project an offset credit for each metric tonne CO2 equivalent of 97% of the eligible GHG emission reductions reported in accordance with subparagraph 5 of the first paragraph of section 70.14 for the period covered by the project report, rounded down to the nearest whole number.

The offset credits corresponding to the remainder of the GHG emission reductions for the period covered by the project report are placed in the Minister’s environmental integrity account.

If the verification report is negative or the project is not in conformity with the conditions of this Regulation, no offset credit is issued to the promoter by the Minister for the period covered by the project report.

O.C. 1184-2012, s. 45; O.C. 1138-2013, s. 25; O.C. 902-2014, s. 54.

70.21. The Minister may require the promoter to replace any offset credit issued for eligible GHG emission reductions reported in accordance with subparagraph 5 of the first paragraph of section 70.14 for a project in the following cases:

(1)  where, because of omissions, inaccuracies or false information in the information and documents provided by the promoter, the GHG emission reductions for which the offset credits were issued were not eligible;

(2)  where offset credits were applied for under another program for the same reductions as those covered by the application for credits under this Regulation;

(3)  where the project was not carried out in accordance with the provisions of this Regulation.

The Minister notifies the promoter who must, within 30 days of receiving the notice, place in its general account an emission allowance for each illegitimate offset credit that must be replaced.

The Minister, after being notified that the promoter has placed the credits in the general account, deducts the replacement emission allowances designated by the promoter and places them in the invalidation account to be extinguished. The Minister also transfers the offset credits paid into the environmental integrity account for the project into the invalidation account to be extinguished.

Without prejudice to the Minister’s other recourses against the promoter, if the promoter has failed to surrender the replacement emission allowances on the expiry of the 30-day period, the Minister replaces the illegitimate offset credits by withdrawing an equivalent number of credits from the environmental integrity account and placing them in the invalidation account to be extinguished.

When the promoter fails to replace illegitimate offset credits, the project is removed from the register of offset credit projects.

O.C. 1184-2012, s. 45; O.C. 902-2014, s. 55; O.C. 1089-2015, s. 23.

70.21.1. If a partner entity cancels offset credits held in the account of an emitter or a participant registered pursuant to this Regulation, the Minister notifies the emitter or participant of his intention to cancel the offset credits, in accordance with the second paragraph of section 46.12 of the Environment Quality Act (chapter Q-2). After the offset credits concerned have been cancelled, they are transferred into the Minister’s invalidation account to be surrendered to the partner entity.

If a partner entity cancels offset credits that were used for emitter compliance purposes, the Minister notifies the emitter, who must, within 6 months after receiving the notice, replace the cancelled offset credits by placing an equivalent number of emission allowances in its compliance account. The emission allowances are deducted in the order prescribed in section 21 and placed in the Minister’s retirement account to be extinguished. The cancelled offset credits recorded in the Minister’s retirement account are transferred into the Minister’s invalidation account and surrendered to the partner entity.

If the emission allowances required under the second paragraph are not surrendered by the emitter within the prescribed time, the provisions of sections 22 and 23 apply, with the necessary modifications, and the year of issue of the emission allowances is not taken into account.

O.C. 902-2014, s. 56.

70.22. Any change to the information and documents provided in accordance with this Chapter must be communicated to the Minister within 10 days.

O.C. 1184-2012, s. 45.

TITLE IV ADMINISTRATIVE PROVISIONS, OFFENCES AND FINAL PROVISIONS

O.C. 1297-2011, title IV; O.C. 1184-2012, s. 46.

CHAPTER I MONETARY ADMINISTRATIVE SANCTIONS

O.C. 1297-2011, c. I; O.C. 1184-2012, s. 47.

71. A monetary administrative sanction of $500 in the case of a natural person and $2,500 in all other cases may be imposed on any person who

(1)  contravenes section 4, 8, 9, 11 or 12, the second paragraph of section 13, section 14.1, the second paragraph of section 18, section 18.1, 18.2 or 18.4, the second paragraph of section 19, the sixth paragraph of section 26, the fourth paragraph of section 26.3, the fifth paragraph of section 27.1, the second paragraph of section 33 or 51, section 53, 62, 70.5, 70.13 or 70.14, the first, third or fifth paragraph of section 70.15 or section 70.22;

(2)  in contravention of this Regulation, refuses or neglects to send notification or provide any other information, study, research or expertise, information, report, summary, plan or other document, or who fails to comply with the time limits for providing such documents, in cases where no monetary administrative sanction is otherwise provided for.

O.C. 1297-2011, s. 71; O.C. 1184-2012, s. 47; O.C. 1138-2013, s. 26; O.C. 902-2014, s. 57; O.C. 1089-2015, s. 24.

72. A monetary administrative sanction of $1,000 in the case of a natural person and $5,000 in all other cases may be imposed on any person who contravenes subparagraph 1 of the first paragraph of section 18, section 32, the second or third paragraph of section 50 or 70.12, or the second paragraph of section 70.15.

O.C. 1297-2011, s. 72; O.C. 1184-2012, s. 47; O.C. 902-2014, s. 58.

73. A monetary administrative sanction of $2,500 in the case of a natural person and $10,000 in all other cases may be imposed on any person who

(1)  contravenes section 7 or 17, the first or third paragraph of section 19, section 19.1 or 20, the first paragraph of section 21, the first or second paragraph of section 23.1 or section 24, section 28, 29, 30 or 31, the second paragraph of section 37, the first paragraph of section 51 or the second paragraph of section 70.21 or 70.21.1;

(2)  fails to place emission allowances or emission units pursuant to subparagraph 2 of the first paragraph of section 18, or the fourth paragraph of section 22 or 41, in cases where no other administrative sanction may be applied.

O.C. 1184-2012, s. 47; O.C. 902-2014, s. 59; O.C. 1089-2015, s. 25.

CHAPTER I.1 OFFENCES

O.C. 1184-2012, s. 47.

74. A person who contravenes section 4, 8, 9, 11 or 12, the second paragraph of section 13, section 14.1, the second paragraph of section 18, section 18.1, 18.2 or 18.4, the second paragraph of section 19, the sixth paragraph of section 26, the fourth paragraph of section 26.3, the fifth paragraph of section 27.1, the second paragraph of section 33 or 51, section 53, 62, 70.5, 70.13 or 70.14, the first, third or fifth paragraph of section 70.15 or section 70.22 is guilty of an offence and is liable,

(1)  in the case of a natural person, to a fine of $3,000 to $100,000; and

(2)  in other cases, to a fine of $10,000 to $600,000.

A person who contravenes any other requirement of this Regulation is guilty of an offence and liable, in cases where no penalty is otherwise provided for in this Chapter or in the Environment Quality Act (chapter Q-2), in the case of a natural person, to a fine of $3,000 to $100,000 and, in other cases, to a fine of $10,000 to $600,000.

O.C. 1297-2011, s. 74; O.C. 1184-2012, s. 47; O.C. 1138-2013, s. 27; O.C. 902-2014, s. 60; O.C. 1089-2015, s. 26.

75. A person who contravenes subparagraph 1 of the first paragraph of section 18, section 32, the second or third paragraph of section 50 or 70.12 or the second paragraph of section 70.15 is guilty of an offence and is liable,

(1)  in the case of a natural person, to a fine of $6,000 to $250,000; and

(2)  in other cases, to a fine of $25,000 to $1,500,000.

O.C. 1297-2011, s. 75; O.C. 1184-2012, s. 47; O.C. 902-2014, s. 61.

75.1. A person who contravenes section 7 or 17, the first or second paragraph of section 24, the second paragraph of section 37, the fourth paragraph of section 41, the first paragraph of section 51 or the second paragraph of section 70.21 is guilty of an offence and is liable,

(1)  in the case of a natural person, to a fine of $10,000 to $500,000 or, despite article 231 of the Code of Penal Procedure (chapter C-25.1), to imprisonment for a maximum term of 18 months; and

(2)  in other cases, to a fine of $40,000 to $3,000,000.

O.C. 1184-2012, s. 47; O.C. 902-2014, s. 62; O.C. 1089-2015, s. 27.

75.2. A person who communicates false or misleading information to the Minister for the purposes of this Regulation is guilty of an offence and is liable,

(1)  in the case of a natural person, to a fine of $5,000 to $500,000 or, notwithstanding article 231 of the Code of Penal Procedure (chapter C-25.1), to imprisonment for a maximum term of 18 months; and

(2)  in other cases, to a fine of $15,000 to $3,000,000.

O.C. 1184-2012, s. 47.

75.3. A person who contravenes section 28, 29, 30 or 31 or who directly or indirectly engages or participates in any transaction, series of transactions or trading method relating to an emission allowance, or in any act, practice or course of conduct is guilty of an offence if the person knows, or ought reasonably to know, that the transaction, series of transactions, trading method, act, practice or course of conduct

(1)  creates or contributes to create a misleading appearance of trading activity in, or an artificial price for, an emission allowance; or

(2)  perpetrates a fraud on any person.

A person referred to in the first paragraph is liable,

(1)  in the case of a natural person, to a fine of $10,000 to 500,000 or, despite article 231 of the Code of Penal Procedure (chapter C-25.1), to imprisonment for a maximum term of 18 months; and

(2)  in other cases, to a fine of $40,000 to $3,000,000.

O.C. 1184-2012, s. 47; O.C. 902-2014, s. 63.

75.4. An emitter who fails to cover GHG emissions in accordance with subparagraph 2 of the first paragraph of section 18, the first or third paragraph of section 19, section 19.1 or 20, the first paragraph of section 21, the fourth paragraph of section 22, the first or second paragraph of section 23.1 or the second paragraph of section 70.21.1 is guilty of an offence for each metric tonne of GHG not covered and is liable, for each metric tonne, to a fine of $3,000 to $600,000.

O.C. 1184-2012, s. 47; O.C. 902-2014, s. 64; O.C. 1089-2015, s. 28.

CHAPTER II FINAL

76. (Omitted).

O.C. 1297-2011, s. 76.

APPENDIX A

(s. 2)

Sectors of activity targeted by the cap-and-trade system for greenhouse gas emission allowances

 _________________________________________________________________________________
|                      |                                       |                  |
|     Sector           |          Type of activity             |   6-digit NAICS* |
|                      |                                       |  code beginning  |
|                      |                                       |       with:      |
|______________________|_______________________________________|__________________|
|                      |                                       |                  |
| Mining, quarrying and| Extraction of naturally occurring     | 21               |
| oil and natural gas  | minerals                              |                  |
| extraction           |                                       |                  |
|                      |                                       |                  |
|______________________|_______________________________________|__________________|
|                      |                                       |                  |
| Electric power       | Generation of bulk electric power,    | 2211             |
| generation,          | transmission from generating          |                  |
| transmission and     | facilities to distribution centres,   |                  |
| distribution         | and/or distribution to end users      |                  |
|                      |                                       |                  |
|______________________|_______________________________________|__________________|
|                      |                                       |                  |
| Natural gas          | Distribution, through a system of     | 2212             |
| distribution         | mains, of natural or synthetic gas    | 488990           |
|                      | to consumers, also including the      | (natural gas     |
|                      | trade of the sale of natural gas by   | regasification   |
|                      | marketers and brokers, that arrange   | or liquefaction) |
|                      | the sale of natural gas over          |                  |
|                      | distribution systems operated by      |                  |
|                      | others                                |                  |
|______________________|_______________________________________|__________________|
|                      |                                       |                  |
| Steam and            | Production and distribution of steam  | 22133            |
| airconditioning      | and heated or cooled air for          |                  |
| production for       | industrial purposes                   |                  |
| industrial purposes  |                                       |                  |
|______________________|_______________________________________|__________________|
|                      |                                       |                  |
| Manufacturing        | Mechanical or physical transformation | 31, 32 or 33     |
|                      | of materials or substances into new   |                  |
|                      | products, except activities to process|                  |
|                      | waste by dismembering and related     |                  |
|                      | activities                            |                  |
|______________________|_______________________________________|__________________|
|                      |                                       |                  |
| Pipeline             | Transportation of crude oil, refined  | 486              |
| transportation       | products and natural gas, gas fields, | 488990           |
|                      | processing plants and local           | (natural gas     |
|                      | distribution systems                  | regasification   |
|                      |                                       | or liquefaction) |
|______________________|_______________________________________|__________________|

* The numbers indicated for each category of industrial or commercial activity mentioned in Appendices A and C correspond to the codes assigned by the North American Industry Classification System (NAICS). The description of each category of activity found in the document “North American Industry Classification System, Canada 2007” published by Statistics Canada (Catalogue no. 12-501-XIE2007001, 2007, ISBN 0-662-44519-8) applies for the purposes of this Regulation.

O.C. 1297-2011, Sch. A; O.C. 1184-2012, s. 48; O.C. 1089-2015, s. 29.

APPENDIX B

(Revoked)

O.C. 1297-2011, Sch. B; O.C. 1184-2012, s. 49.

APPENDIX B.1

(s. 37)

Partner entities

(1) State of California

The emission allowances issued by the State of California pursuant to the document California Cap on Greenhouse Gas Emissions and Market-Based Compliance Mechanisms, Title 17, California Code of Regulations, Sections 95800 and seq. are deemed to be equivalent to the emission allowances issued pursuant to this Regulation, based on the correspondence indicated in the following table for each type of emission allowance:

 _________________________________________________________________________________
|                           |                          |                          |
|                           |          Québec          |        California        |
|___________________________|__________________________|__________________________|
|                           |                          |                          |
| Types of emission         | Emission unit            |  California Greenhouse   |
| allowance (each having    |__________________________|  Gas Emissions           |
| a value corresponding     |                          |  Allowance (CA GHG       |
| to 1 metric tonne         | Early reduction credot   |  Allowance)              |
| CO2 equivalent)           |__________________________|__________________________|
|                           |                          |                          |
|                           | Offset credit            | - ARB Offset Credit      |
|                           |                          |                          |
|                           |                          | - Early Action Offset    |
|                           |                          | Credit                   |
|___________________________|__________________________|__________________________|

D. 1184-2012, a. 50; D. 1137-2013, a. 1; D. 1181-2013.

APPENDIX C

(ss. 39, 40 and 41)

Part I

Table A Activities eligible for the allocation without charge of greenhouse gas emission units

 
 _________________________________________________________________________________
|                                        |                                        |
|                Activity                |      6-digit NAICS* code beginning     |
|                                        |                     with               |
|________________________________________|________________________________________|
|                                        |                                        |
| Mining and quarrying (except oil       |        212                             |
| and gas)                               |                                        |
|________________________________________|________________________________________|
|                                        |                                        |
| Electric power generation sold under a |        2211                            |
| contract signed prior to 1 January     |                                        | 
| 2008, that has not been renewed or     |                                        | 
| extended after that date, in which the |                                        | 
| sale price is fixed for the duration   |                                        | 
| of the contract, with no possibility   |                                        |
| of adjusting the price to take into    |                                        | 
| account the costs relating to the      |                                        |
| implementation of a cap-and-trade      |                                        | 
| system for greenhouse gas emission     |                                        | 
| allowances                             |                                        |
|                                        |                                        |
| Acquisition, for the consumption of    |                                        | 
| the enterprise or for sale in Québec,  |                                        | 
| of power generated in another Canadian |                                        | 
| province or territory or in a state in |                                        | 
| which the government has established a |                                        | 
| cap-and-trade system for greenhouse    |                                        | 
| gas emission allowances targeting      |                                        | 
| power generation, but has not signed   |                                        | 
| an agreement referred to in section    |                                        | 
| 46.14 of the Environment Quality Act   |                                        | 
| (chapter Q-2)                          |                                        | 
|________________________________________|________________________________________|
|                                        |                                        |
| Steam and air-conditioning supply      |        22133                           |
| for industrial purposes                |                                        |
|________________________________________|________________________________________|
|                                        |                                        |
|  Manufacturing                         |        31, 32 or 33                    |
|________________________________________|________________________________________|                                                            

Table B Reference units1

 _________________________________________________________________________________
|              |                                   |                              |
| Sector of    | Type of activity                  | Reference unit               |
| activity     |                                   |                              |
| of the       |                                   |                              |
| establishment|                                   |                              |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Aluminum     | Baked cathode production          | Metric tonne of baked        |
|              |                                   | cathodes removed from furnace|
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Aluminum     | Aluminum production               | Metric tonne of liquid       | 
|              |                                   | aluminum (leaving potroom)   | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Aluminum     | Baked anode production            | Metric tonne of baked anodes |
|              |                                   | removed from furnace         |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Aluminum     | Aluminum hydroxide production     | Metric tonne of aluminum     | 
|              | and secondary activities          | hydroxide hydrate expressed  |
|              |                                   | as AI2O3 equivalent          |
|              |                                   | calculated at the            |
|              |                                   | precipitation stage          |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Aluminum     | Calcinated coke production        | Metric tonne of calcinated   |
|              |                                   | coke                         |             
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Beer production                   | Hectolitre of beer           | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Alcohol production                | Kilolitre of alcohol         |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Graphite electrode manufacturing  | Metric tonne of graphite     |
|              |                                   | electrodes                   |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Gypsum panel manufacturing        | Cubic metre of gypsum panel  | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Sugar production                  | Metric tonne of sugar        |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Glass container manufacturing     | Metric tonne of glass        | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Steam production (for sale to a   | Metric tonne of steam        |
|              | third person)                     |                              |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Production of semi-conductors and | Square metre of silicon      |
|              | other electronic components       | substrate associated with    |
|              |                                   | deep reactive ion etching    |
|              |                                   |                              |
|              |                                   | Square metre of silicon      |
|              |                                   | substrate associated with an |
|              |                                   | etching process other than   |
|              |                                   | deep reactive ion etching    |
|              |                                   |                              |
|              |                                   | Square metre of silicon      |
|              |                                   | substrate associated with    |
|              |                                   | plasma enhanced chemical     |
|              |                                   | vapor deposition             |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Carbone dioxide production        | Metric tonne of carbon       |
|              |                                   | dioxide                      |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Other2       | Oilseed processing                | Metric tonne of processed    |
|              |                                   | oilseeds                     |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Lime         | Lime production                   | Metric tonne of calcic lime  | 
|              |                                   | and metric tonne of calcic   | 
|              |                                   | lime kiln dust sold          | 
|              |                                   |                              | 
|              |                                   | Metric tonne of dolomitic    | 
|              |                                   | lime and metric tonne of     | 
|              |                                   | dolomitic lime kiln dust sold| 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Ethanol production                | Kilolitre of ethanol         | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Tire production                   | Metric tonne of tires        | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Fabrication of rigid foamed       | Board foot of rigid          | 
|              | insulation                        | insulation                   | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of titanium dioxide    | Metric tonne of titanium     | 
|              | (Ti O2)                           | pigment equivalent (raw      | 
|              |                                   | material)                    | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of linear alkylbenzene | Metric tonne of LAB          |
|              | (LAB)                             |                              |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of catalyzer           | Metric tonne of catalyzer    | 
|              |                                   | (including additives)        | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of hydrogen            | Metric tonne of hydrogen     | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of purified            | Metric tonne of PTA          | 
|              | terephtalic acid (PTA)            |                              | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of paraxylene          | Metric tonne of xylene and   | 
|              |                                   | toluene                      | 
|              |                                   |                              | 
|              |                                   | Metric tonne of steam sold   | 
|              |                                   | to a third person            | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of sodium silicate     | Metric tonne of sodium       | 
|              |                                   | silicate                     | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Production of sulphur (refinery   | Metric tonne of sulphur      | 
|              | gas)                              |                              | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Chemical     | Polyethylene terephthalate (PET)  | Metric tonne of polyethylene |
|              | production                        | therephthalate (PET)         |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Cement       | Cement production                 | Metric tonne of clinker and  | 
|              |                                   | metric tonne of mineral      | 
|              |                                   | additives (gypsum and        |
|              |                                   | limestone) added to the      | 
|              |                                   | clinker produced             |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Electricity  | Electricity production            | Megawatt-hour (MWH)          | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Electricity  | Acquisition of electricity        | Megawatt-hour (MWH)          | 
|              | produced outside Québec for the   |                              | 
|              | consumption of the enterprise or  |                              | 
|              | for sale in Québec                |                              | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Electricity  | Steam production (except steam    | Metric tonne of steam        | 
|              | produced by cogeneration)         |                              |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Steel production (steelworks)     | Metric tonne of steel        | 
|              |                                   | (slabs, pellets or ingots)   | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Wrought steel production          | Metric tonne of wrought steel| 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Steel pellet or slab rolling      | Metric tonne of rolled steel | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Copper anode production           | Metric tonne of copper anodes| 
|              |                                   |                              | 
|              |                                   | Metric tonne of recycled     | 
|              |                                   | secondary materials          | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Iron ore concentrate pellet       | Metric tonne of reduced      |
|              | reduction                         | iron pellets                 |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Copper cathode production         | Metric tonne of copper       | 
|              |                                   | cathodes                     | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Ferrosilicon production           | Metric tonne of ferrosilicon | 
|              |                                   | (50% and 75% concentration)  | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Lead production                   | Metric tonne of lead         | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Metal powder manufacturing        | Metric tonne of saleable     | 
|              |                                   | iron powder and steel powder |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Titanium dioxide (Ti O2) slag     | Metric tonne of Ti O2 slag   | 
|              | manufacturing                     | cast at the reduction        |
|              |                                   | furnaces                     | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Silicon metal production          | Metric tonne of silicon metal|   
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Metallurgy   | Zinc production                   | Metric tonne of iron load    | 
|              |                                   |                              | 
|              |                                   | Metric tonne of cathodic zinc| 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Mining and   | Pellet production                 | Metric tonne of flux pellets | 
| pelletization|                                   |                              | 
|              |                                   | Metric tonne of standard     | 
|              |                                   | pellets                      |
|              |                                   |                              |
|              |                                   | Metric tonne of low silica   |
|              |                                   | flux pellets                 |
|              |                                   |                              |
|              |                                   | Metric tonne of direct       |
|              |                                   | reduction pellets            |
|              |                                   |                              |
|              |                                   | Metric tonne of blast        |
|              |                                   | furnace pellets              | 
|              |                                   |                              |
|              |                                   | Metric ton of intermediate   |
|              |                                   | pellets                      |
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Mining and   | Iron concentrate production       | Metric tonne of iron         | 
| pelletization|                                   | concentrate                  |  
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Mining and   | Nickel concentrate production     | Metric tonne of nickel       |
| pelletization|                                   | produced                     | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Mining and   | Nickel concentrate and copper     | Metric tonne of nickel       |
| pelletization| concentrate production            | and copper produced          | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Pulp and     | Pulp and paper production         | Metric tonne of various      | 
| paper        |                                   | air-dried saleable products  | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Pulp and     | Production of wood-fibre based    | Metric tonne of various      | 
| paper        | products                          | air-dried saleable products  | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Pulp and     | Production of pulp and paper and  | Metric tonne of various      | 
| paper        | wood-fibre based products         | air-dried saleable products  | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Pulp and     | Steam production                  | Metric tonne of saleable     | 
| paper        |                                   | various air-dried products of| 
|              |                                   | each of the establishments   | 
|              |                                   | common to a steam network    | 
|______________|___________________________________|______________________________|
|              |                                   |                              |
| Refining     | Oil refining                      | Kilolitre of total crude oil | 
|              |                                   | refinery load                | 
|______________|___________________________________|______________________________|                                                             

1 An establishment pursuing a type of activity that is not listed in this table must use the reference unit declared in its emissions report under the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15).

2 These reference units must be used when the type of activity is not exercised in another sector of activity specifically referred to in this Table.

Part II

Calculation methods for the allocation of emission units without charge

(A) Definition of “covered establishment as of 2013” and “covered establishment after 2013”

For the purposes of the calculation methods,

(1) “covered establishment as of 2013” means an establishment for which the GHG reported emissions for 2009, 2010 or 2011 are equal to or exceed the emissions threshold;

(2) “covered establishment after 2013” means an establishment, other than an establishment to which paragraph 1 applies, for which the verified emissions are equal to or exceed the emissions threshold in 2012 or in a subsequent year.

(B) Categories of GHG emissions by origin

GHG emissions are divided into 3 categories on the basis of their origin: fixed process emissions, combustion emissions and other emissions.

Fixed process emissions are the CO2 emissions resulting from a fixed chemical reaction process for production purposes that generates CO2, from chemically-bonded carbon in the raw material, or from the carbon used to remove an undesirable component from the raw material where there is no substitutable raw material.

Combustion emissions are the emissions resulting from the exothermic reaction of any fuel, except CO2 emissions attributable to the combustion of biomass or biomass fuels.

Other emissions are the emissions that do not meet the criteria for fixed process emissions or combustion emissions.

(C) Establishments and new facilities considered on a sectoral basis for the allocation of emission units without charge

For the purpose of calculating the number of emission units that may be allocated without charge to an emitter, establishments and new facilities pursuing the following activities are considered on a sectoral basis:

(1) lime production;

(2) cement production;

(3) prebaked anode production and aluminum production using prebaked anode technologies.

(D) Calculation methods

For the application of the methods set out in this Part, the result of an emission intensity calculation is rounded off to four significant figures and the result of an emission unit allocation calculation is rounded up to the nearest whole number.

For the application of the calculation methods set out in this Part, the GHG emissions data used are

(1) for the years 2007 to 2011, the data for reported emissions, minus the emissions referred to in the second paragraph of section 6.6 of the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15)

(2) for the years 2012 and following, the verified emissions.

Subject to the fourth paragraph, the total quantity of GHG emission units allocated without charge to an emitter is calculated in accordance with the following methods:

(1) in the case of an establishment covered as of 2013 that is not considered on a sectoral basis and that possesses GHG emissions data for 2007-2010, using equations 1-1 and 2-1 to 2-9;

(1.1) in the case of an establishment covered as of 2013 that is not considered on a sectoral basis and that does not possess GHG emissions data for 2007-2010, using equations 1-1 and 4-1 to 4-8;

(2) in the case of an establishment covered as of 2013 that is considered on a sectoral basis and that possesses GHG emissions data for 2007-2010, using equations 1-1 and 3-1 to 3-10;

(2.1) in the case of an establishment covered as of 2013 that is considered on a sectoral basis and that does not possess GHG emissions data for 2007-2010, using equations 1-1, 5-1 and 5-2;

(3) in the case of an establishment covered after 2013 that is not considered on a sectoral basis, using equations 1-1 and 4-1 to 4-8;

(4) in the case of an establishment covered after 2013 that is considered on a sectoral basis, using equations 1-1, 5-1 and 5-2.

In the special cases provided for below, the emission units allocated without charge to an emitter are calculated:

(1) in the case of an establishment producing aluminum anodes using Söderberg anode technology after 2014, using equation 2-9 but replacing the factor “I2020i” by the factor “I2020 sod” calculated using equation 6-1;

(2) in the case of an establishment producing alumina from bauxite, using equation 6-2;

(3) in the case of an establishment producing rigid foamed insulation, using equation 2-1 for 2013 and 2014, calculating the factor “I2013” using equations 6-3 to 6-6, and using equation 6-7 for 2015 to 2020;

(4) in the case of an establishment producing zinc and generally using hydrogen as a fuel to supply its furnaces, using equations 6-8 to 6-10;

(5) in the case of a new facility, using the methods in subdivision 6.5;

(6) in the case of an establishment covered after 2013 whose production replaces all or part of the production of another establishment or facility of the same emitter in Québec that closed after 1 January 2008, using the methods in subdivision 6.6;

(7) in the case of an enterprise who acquires, for the consumption of the enterprise or for sale in Québec, power generated in another Canadian province or territory or in a state in which the government has established a cap-and-trade system for greenhouse gas emission allowances targeting power generation, but has not signed an agreement referred to in section 46.14 of the Environment Quality Act (chapter Q-2), using equation 6-11.

(8) in the case of a copper foundry, using equations 6-12 and 6-13.

To be considered in the calculation of emission units allocated without charge, any change to the information set out in subparagraph 4 of the first paragraph of section 7 and provided by the emitter when registering for the system must be sent to the Minister, along with all supporting documents, not later than

(1) 1 June 2015, in the case of an emitter operating an establishment covered as of 2013;

(2) 1 June following the end of the first compliance period for which the emitter is required to cover its GHG emissions, in the case of an emitter operating an establishment covered after 2013.

1. Calculation of the total quantity of GHG emission units allocated without charge for an establishment

Equation 1-1 Calculation of the total quantity of GHG emission units allocated without charge for an establishment

Where:

Aestablishment i j = Total quantity of GHG emission units allocated without charge for an establishment for year i for all types of activities j in Table B of Part I of this Schedule for that establishment;

i = Each year included in the period 2013 to 2020;

j = Each type of activity at the establishment;

m = Total number of types of activity at the establishment;

Ai j = Number of GHG emission units allocated without charge by type of activity j for year i, calculated using equations 2-1, 2-9, 3-1, 3-10, 4-1, 4-8, 5-1, 5-2, 6-2, 6-7, 6-8 and 6-9.

2. Covered establishment as of 2013 that is not considered on a sectoral basis

(2.1) Calculation method for the years 2013 and 2014

Equation 2-1 Calculation of the number of GHG emission units allocated without charge by type of activity at an establishment that is not considered on a sectoral basis for the years 2013 and 2014

Ai j = I2013j × PRi j

Where:

Ai j = Total number of GHG emission units allocated without charge for type of activity j at an establishment for year i;

i = Each year included in the first compliance period, namely 2013 and 2014;

j = Type of activity;

I2013j = Intensity target of GHG emissions attributable to the type of activity at the establishment for the years 2013 and 2014 calculated using equation 2-2, in metric tonnes CO2 equivalent per reference unit;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 2-2 Calculation of the intensity target of GHG emissions by type of activity at an establishment that is not considered on a sectoral basis for the years 2013 and 2014

I2013j = IFPav j + RxICav j + IOav j

Where:

I2013j = Intensity target of GHG emissions attributable to type of activity j at the establishment for the years 2013 and 2014, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

IFPav j = Average intensity of GHG fixed process emissions attributable to type of activity j at the establishment for the period 2007-2010, calculated using equation 2-3, in metric tonnes CO2 equivalent per reference unit;

R = Multiplication factor for GHG combustion emissions intensity at the establishment calculated using equations 2-4 and 2-5 or, in the case of an establishment producing pulp and paper described by NAICS code 3221 or 321216, a value of 1;

ICav j = Average intensity of GHG combustion emissions attributable to type of activity j at the establishment for the period 2007-2010, calculated using equation 2-6, in metric tonnes CO2 equivalent per reference unit;

IO av j = Average intensity of other GHG emissions attributable to type of activity j at the establishment for the period 2007-2010, calculated using equation 2-7, in metric tonnes CO2 equivalent per reference unit.

Equation 2-3 Average intensity GHG fixed process emissions by type of activity at an establishment that is not considered on a sectoral basis for the period 2007-2010

Where:

IFPav j = Average intensity of GHG fixed process emissions attributable to type of activity j at the establishment for the period 2007-2010, in metric tonnes CO2 equivalent per reference unit;

i = Each year included in the period 2007-2010;

j = Type of activity;

GHG FPi j = GHG fixed process emissions attributable to type of activity j at the establishment for year i, in metric tonnes CO2 equivalent;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 2-4 Calculation of the intensity multiplication factor for combustion emissions at an establishment that is not considered on a sectoral basis

R = 0.80 × GFR + (1-GFR)

Where:

R = Multiplication factor for GHG combustion emissions intensity at the establishment;

0.80 = Proportion corresponding to 80% of the GFR ratio;

GFR = Ratio between total GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, and total GHG combustion emissions at the establishment, calculated using equation 2-5.

Equation 2-5 Calculation of the GFR ratio for an establishment that is not considered on a sectoral basis

Where:

GFR = Ratio between total GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, and total GHG combustion emissions at the establishment;

i = Each year included in the period 2007-2010;

GHG GFR i = GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, at the establishment during year i, in metric tonnes CO2 equivalent;

GHG C i = Total GHG combustion emissions attributable to the use of fuel at the establishment during year i, in metric tonnes CO2 equivalent.

Equation 2-6 Average intensity of GHG combustion emissions by type of activity at an establishment that is not considered on a sectoral basis for the period 2007-2010

Where:

ICav j = Average intensity of GHG combustion emissions attributable to type of activity j at the establishment for the period 2007-2010, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

i = Each year included in the period 2007-2010;

GHG Ci j = GHG combustion emissions attributable to type of activity j at the establishment for year i, in metric tonnes CO2 equivalent;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 2-7 Average intensity of other GHG emissions by type of activity at an establishment that is not considered on a sectoral basis for the period 2007-2010

Where:

IO av j = Average intensity of other GHG emissions attributable to type of activity j at the establishment for the period 2007-2010, in metric tonnes CO2 equivalent per reference unit;

i = Each year included in the period 2007-2010;

j = Type of activity;

GHG O i j = Other GHG emissions attributable to type of activity j at the establishment for year i, in metric tonnes CO2 equivalent;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 2-8 Calculation of the intensity target of GHG emissions by type of activity at an establishment that is not considered on a sectoral basis for the year 2020

I2020j = IFPav + R min [(0.95)ICmin j; (0.90)ICav j] + min [(0.95)IO min j; (0.90) IO av j]

Where:

I2020j = Intensity target of GHG emissions attributable to type of activity j at the establishment for the year 2020, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

IFPav = Average intensity of GHG fixed process emissions attributable to type of activity j for the establishment for the period 2007-2010, calculated using equation 2-3, in metric tonnes CO2 equivalent per reference unit;

R = Multiplication factor for GHG combustion emissions at the establishment calculated using equations 2-4 and 2-5 or, in the case of an establishment producing pulp and paper described by NAICS code 3221 or 321216, a value of 1;

min = Minimum value, representing the lesser of the 2 elements calculated;

0.95 = Proportion corresponding to 95% of the minimum intensity of combustion emissions or of the minimum intensity of other GHG emissions;

ICmin j= Minimum annual intensity of GHG combustion emissions attributable to type of activity j at the establishment for the years 2007 to 2010 inclusively, in metric tonnes CO2 equivalent per reference unit;

0.90 = Proportion corresponding to 90% of the average intensity of combustion emissions or the average intensity of other GHG emissions;

ICav j = Average intensity of GHG combustion emissions attributable to type of activity j at the establishment for the period 2007-2010, calculated using equation 2-6, in metric tonnes CO2 equivalent per reference unit;

IO min j = Minimum annual intensity of other GHG emissions attributable to type of activity j at the establishment for the years 2007 to 2010 inclusively, in metric tonnes CO2 equivalent per reference unit;

IO av j = Average intensity of other GHG emissions attributable to type of activity j at the establishment for the period 2007-2010, calculated using equation 2-7, in metric tonnes CO2 equivalent per reference unit.

(2.2) Calculation method for the years 2015-2020

Equation 2-9 Calculation of the number of GHG emission units allocated without charge by type of activity at an establishment that is not considered on a sectoral basis for the years 2015-2020

      
     Ai j = (6 - x) I2013j + xI2020j 
          _________________________ × PRi j
                      6                              
                                                         

Where:

Ai j= Total number of GHG emission units allocated without charge by type of activity j at an establishment for year i;

i = Each year included in the second and third compliance periods, namely 2015, 2016, 2017, 2018, 2019 and 2020;

j = Type of activity;

6 = 6 years in the linear regression, namely 2015, 2016, 2017, 2018, 2019 and 2020;

x = (i – 2015) + 1;

I2013j = Intensity target of GHG emissions attributable to type of activity j at the establishment for the years 2013 and 2014, calculated using equation 2-2, in metric tonnes CO2 equivalent per reference unit;

I2020j = Intensity target of GHG emissions attributable to type of activity j at the establishment for the year 2020, calculated using equation 2-8, in metric tonnes CO2 equivalent per reference unit;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j for year i.

3. Covered establishment as of 2013 that is considered on a sectoral basis

(3.1) Calculation method for the years 2013 and 2014

Equation 3-1 Calculation of the number of GHG emission units allocated without charge by type of activity at an establishment that is considered on a sectoral basis for the years 2013 and 2014

Ai j = max(I2013j;I2020s j) × PRi j

Where:

Ai j = Total number of GHG emission units allocated without charge by type of activity j at an establishment for year i;

i = Each year included in the first compliance period, namely 2013 and 2014;

j = Type of activity;

max = Maximum value, representing the greater of the values I2013j and I2020s j;

I2013j = Intensity target of GHG emissions attributable to type of activity j at the establishment for the years 2013 and 2014 calculated using equation 2-2, in metric tonnes CO2 equivalent per reference unit;

I2020s j = Intensity target of GHG emissions attributable to type of activity j in the sector for the year 2020, calculated using equation 3-2, in metric tonnes CO2 equivalent per reference unit;

PRi j = Total quantity of reference units produced or used for type of activity j at the establishment for year i.

Equation 3-2 Calculation of the intensity target of GHG emissions by type of activity at an establishment that is considered on a sectoral basis for the year 2020

I2020s j = IFPav(S) j + Rs × min[(0.95)ICmin(S) j;(0.90)ICav(S)j]+min[(0.95)IOmin(S) j;(0.90)IO av(S) j]

Where:

I2020s j = Intensity target of GHG emissions attributable to type of activity j in the sector for the year 2020, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

IFPav(S) j = Average intensity of GHG fixed process emissions attributable to type of activity j in the sector for the period 2007-2010, calculated using equation 3-3, in metric tonnes CO2 equivalent per reference unit;

Rs = Sectoral multiplication factor for the intensity of GHG combustion emissions calculated using equations 3-4 and 3-5;

min = Minimum value, representing the lesser of the 2 elements calculated;

0.95 = Proportion corresponding to 95% of the minimum intensity of combustion emissions or of the minimum intensity of other GHG emissions;

ICmin(S) j = Minimum annual average intensity of GHG combustion emissions attributable to type of activity j in the sector for the years 2007 to 2010 inclusively, calculated using equation 3-6, in metric tonnes CO2 equivalent per reference unit;

0.90 = Proportion corresponding to 90% of the average intensity of combustion emissions or the average intensity of other GHG emissions;

ICav(S)j = Average intensity of GHG combustion emissions attributable to type of activity j in the sector for the period 2007-2010, calculated using equation 3-7, in metric tonnes CO2 equivalent per reference unit;

IOmin(S) j = Minimum annual average intensity of other GHG emissions attributable to type of activity j in the sector for the years 2007 to 2010 inclusively, calculated using equation 3-8, in metric tonnes CO2 equivalent per reference unit;

IO av(S) j = Average intensity of other GHG emissions attributable to type of activity j in the sector for the period 2007-2010, calculated using equation 3-9, in metric tonnes CO2 equivalent per reference unit.

Equation 3-3 Average intensity of GHG fixed process emissions attributable to the type of activity in the sector for the period 2007-2010

Where:

IFPav(S) j = Average intensity of GHG fixed process emissions attributable to type of activity j in the sector for the period 2007-2010, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

i = Each year included in the period 2007-2010;

l = Number of covered establishments as of 2013 in the sector;

GHG FPi jk = GHG fixed process emissions attributable to type of activity j at establishment k for year i, in metric tonnes CO2 equivalent;

k = Covered establishment as of 2013 in the sector;

PRi jk = Total quantity of reference units produced or used at establishment k for type of activity j for year i.

Equation 3-4 Calculation of the combustion intensity multiplication factor at an establishment that is considered on a sectoral basis

Rs = 0.80 X GFRs + (1 - GFRs)

Where:

Rs = Sectoral multiplication factor for the intensity of GHG combustion emissions at the establishment;

0.80 = Proportion corresponding to 80% of the GFRs ratio;

GFRs = Ratio between the total GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, and total GHG combustion emissions at establishments in the sector, calculated using equation 3-5.

Equation 3-5 Calculation of the GFRs ratio for an establishment that is considered on a sectoral basis

Where:

GFRs = Ratio between the total GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, and total GHG combustion emissions at establishments in the sector;

i = Each year included in the period 2007-2010;

l = Number of establishments in the sector covered as of 2013;

k = Establishment in the sector covered as of 2013 in the sector;

GHG GFRsi k = GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, at the establishment k during year i, in metric tonnes CO2 equivalent;

GHG Csi k = Total GHG combustion emissions attributable to the use of fuel at establishment k for year i, in metric tonnes CO2 equivalent.

Equation 3-6 Calculation of the minimum average annual intensity of GHG combustion emissions attributable to the type of activity in the sector for 2007 to 2010

Where:

ICmin(s)j = Minimum average annual intensity of GHG combustion emissions attributable to type of activity j in the sector for the years 2007 to 2010 inclusively, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

min = Minimum value, representing the lesser of the intensity values for the years 2007, 2008, 2009 and 2010;

l = Number of establishments covered as of 2013 in the sector;

GHG Ci jk = GHG combustion emissions attributable to type of activity j at establishment k during the years i corresponding to 2007, 2008, 2009 and 2010, in metric tonnes CO2 equivalent;

k = Establishment in the sector covered as of 2013;

Pi jk = Total quantity of reference units produced or used at establishment k for type of activity j during the years i corresponding to 2007, 2008, 2009 and 2010.

Equation 3-7 Average intensity of GHG combustion emissions attributable to a type of activity in the sector for the period 2007-2010

Where:

ICav(S) j = Average intensity of GHG combustion emissions attributable to type of activity j in the sector for the period 2007-2010, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

i = Each year included in the period 2007-2010;

l = Number of covered establishments as of 2013 in the sector;

GHG Ci jk = GHG combustion emissions attributable to type of activity j at establishment k for year i, in metric tonnes CO2 equivalent;

k = Covered establishment as of 2013 in the sector;

PRi jk = Total quantity of reference units produced or used at establishment k for type of activity j for year i.

Equation 3-8 Calculation of the minimum average annual intensity of other GHG emissions attributable to a type of activity in the sector for 2007 to 2010

Where:

IOmin(s) j = Minimum average annual intensity of other GHG emissions attributable to type of activity j in the sector for 2007 to 2010 inclusively, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

min = Minimum value, representing the lesser of the intensity values for the years 2007, 2008, 2009 and 2010;

l = Number of establishments covered as of 2013 in the sector;

GHG Oi jk = Other GHG emissions attributable to type of activity j at establishment k for the years i corresponding to 2007, 2008, 2009 and 2010, in metric tonnes CO2 equivalent;

k = Establishment covered in the sector beginning in 2013;

Pi jk = Total quantity of reference units produced or used at establishment k for type of activity j during the years i corresponding to 2007, 2008, 2009 and 2010.

Equation 3-9 Average intensity of other GHG emissions attributable to a type of activity in the sector for the period 2007-2010

Where:

IO av(S) j = Average intensity of other GHG emissions attributable to type of activity j in the sector for the period 2007-2010, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

i = Each year included in the period 2007-2010;

l = Number of covered establishments as of 2013 in the sector;

GHG Oi jk = GHG other emissions attributable to type of activity j at establishment k for year i, in metric tonnes CO2 equivalent;

k = Covered establishment as of 2013 in the sector;

PRijk = Total quantity of reference units produced or used by establishment k for to type of activity j for year i.

(3.2) Calculation methods for the years 2015 to 2020

Equation 3-10 Calculation of the number of GHG emission units allocated without charge by type of activity at an establishment that is considered on a sectoral basis for the years 2015 to 2020

 
               _                                _ 
              |(6 - x) I2013j + xI2020s j         |
     Ai j = max|_________________________;I2020s j| × PRi j
              |_            6                   _|                                                        

Where:

Ai j = Total number of GHG emission units allocated without charge by type of activity j at an establishment for year i;

i = Each year included in the second and third compliance periods, namely 2015, 2016, 2017, 2018,2019 and 2020;

j = Type of activity;

max = Maximum value, representing the greater of the 2 intensity values calculated;

6 = 6 years in the linear regression, namely 2015, 2016, 2017, 2018, 2019 and 2020;

x = (i – 2015) + 1;

I2013j = Intensity target of GHG emissions attributable to type of activity j at the establishment for the years 2013 and 2014 calculated using equation 2-2, in metric tonnes CO2 equivalent per reference unit;

I2020s j = Intensity target of GHG emissions attributable to type of activity j in the sector for the year 2020, calculated using equation 3-2, in metric tonnes CO2 equivalent per reference unit;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

4. Covered establishment as of 2013 that does not possess GHG emissions data for 2007-2010 and covered establishment after 2013 that is not considered on a sectoral basis

(4.1) Calculation method for the years 2013 and 2014

Equation 4-1 Calculation of the number of GHG emission units allocated without charge by type of activity at a covered establishment covered as of 2013 and without data for 2007-2010 or after 2013 that is not considered on a sectoral basis for the years 2013 and 2014

Ai j = Idepj × PRi j

Where:

Ai j = Total number of GHG emission units allocated without charge by type of activity j at an establishment for year i;

i = Each year included in the first compliance period, namely 2013 and 2014;

j = Type of activity;

Idep j = Intensity target of GHG emissions attributable to type of activity j at an establishment, calculated using equation 4-2, in metric tonnes CO2 equivalent per reference unit;

PRi j= Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 4-2 Calculation of the intensity target of GHG emissions for the years 2013 and 2014 by type of activity at a covered establishment covered as of 2013 and without data for 2007-2010 or after 2013

Idepj = IFPdep j + (R × ICdep j) + IOdep j

Where:

Idepj= Intensity target of GHG emissions attributable to type of activity j at an establishment, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

IFPdep j = Average intensity of GHG fixed process emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, calculated using equation 4-3, in metric tonnes CO2 equivalent per reference unit;

d = First year for which the GHG emissions of the establishment are equal to or exceed the emissions threshold;

R = Multiplication factor for GHG combustion emissions at the establishment calculated using equations 4-6 and 4-7 or, in the case of an establishment producing pulp and paper described by NAICS code 3221 or 321216, a value of 1;

ICdep j = Average intensity of GHG combustion emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, calculated using equation 4-4, in metric tonnes CO2 equivalent per reference unit;

IOdep j= Average intensity of other GHG emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, calculated using equation 4-5, in metric tonnes CO2 equivalent per reference unit.

Equation 4-3 Average intensity of GHG fixed process emissions by type of activity at a covered establishment covered as of 2013 and without data for 2007-2010 or after 2013 for the reference years d-2 to d+1

Where:

IFPdep j = Average intensity of GHG fixed process emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

i = Years d-2, d-1, d and d+1, when available, excluding the year in which the establishment is brought into service;

d = First year for which the GHG emissions of the establishment are equal to or exceed the emissions threshold;

GHG FPi j = GHG fixed process emissions attributable to type of activity j at the establishment for year i, in metric tonnes CO2 equivalent;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 4-4 Average intensity of GHG combustion emissions by type of activity for a covered establishment covered as of 2013 and without data for 2007-2010 or after 2013 for the reference years d-2 to d+1

Where:

ICdep j = Average intensity of GHG combustion emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

i = Years d-2, d-1, d and d+1, when available, excluding the year in which the establishment is brought into service;

d = First year for which the GHG emissions of the establishment are equal to or exceed the emissions threshold;

GHG Ci j = GHG combustion emissions attributable to type of activity j at the establishment for year i, in metric tonnes CO2 equivalent;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 4-5 Average intensity of other GHG emissions by type of activity for a covered establishment covered as of 2013 and without data for 2007-2010 or after 2013 for the reference years d-2 to d+1

Where:

IOdep j = Average intensity of other GHG emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, in metric tonnes CO2 equivalent per reference unit;

j = Type of activity;

i = Years d-2, d-1, d and d+1, when available, excluding the year in which the establishment is brought into service;

d = First year for which the GHG emissions of the establishment are equal to or exceed the emissions threshold;

GHG Oi j = GHG other emissions attributable to type of activity j at the establishment for year i, in metric tonnes CO2 equivalent;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

Equation 4-6 Calculation of the intensity multiplication factor for combustion emissions at an establishment covered as of 2013 and without data for 2007-2010 or covered after 2013 that is not considered on a sectoral basis

R = 0.80 × GFR + (1 - GFR)

Where:

R = Intensity multiplication factor for GHG combustion emissions at the establishment;

0.80 = Proportion corresponding to 80% of the GFR ratio;

GFR = Ratio between the total GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, and total GHG combustion emissions at the establishment, calculated using equation 4-7.

Equation 4-7 Calculation of the GFR ratio for an establishment covered as of 2013 and without data for 2007-2010 or covered after 2013 that is not considered on a sectoral basis

Where:

GFR = Ratio between the total GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, and total GHG combustion emissions at the establishment;

i = Years d-2, d-1, d and d+1, when available, excluding the year in which the establishment is brought into service;

GHG GFRi = GHG combustion emissions attributable to the use of natural gas, gasoline, diesel, heating oil, propane, petroleum coke and coal, excluding refinery fuel gas, at the establishment during year i, in metric tonnes CO2 equivalent;

GHG Ci = Total GHG combustion emissions attributable to the use of fuel at the establishment for year i, in metric tonnes CO2 equivalent.

(4.2) Calculation method for the years 2015 to 2020

Equation 4-8 Calculation of the number of GHG emission units allocated without charge by type of activity at an establishment covered as of 2013 and without data for 2007-2010 or that is not considered on a sectoral basis for the years 2015 to 2020

Ai j = [IFPdep j + (R)(0.99)n ICdep j + (0.99)n IOdep j] × PRi j

Where:

Ai j = Total number of GHG emission units allocated without charge by type of activity j for an establishment for year i;

j = Type of activity;

i = Each year in the period 2015-2020 for which the emitter is required to cover GHG emissions;

IFPdep j = Average intensity of the GHG fixed process emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, calculated using equation 4-3, in metric tonnes CO2 equivalent per reference unit;

R = Multiplication factor for GHG combustion emissions at the establishment calculated using equations 4-6 and 4-7 or, in the case of an establishment producing pulp and paper described by NAICS code 3221 or 321216, a value of 1;

0.99 = Proportion corresponding to an annual improvement of 1% in the intensity factor;

n = i - (d + 2);

d = First year for which the GHG emissions of the establishment are equal to or exceed the emissions threshold;

ICdep j = Average intensity of the GHG combustion emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, calculated using equation 4-4, in metric tonnes CO2 equivalent per reference unit;

IOdep j = Average intensity of the other GHG emissions attributable to type of activity j at the establishment for the years d-2 to d+1, when available, excluding the year in which the establishment is brought into service, calculated using equation 4-5, in metric tonnes CO2 equivalent per reference unit;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

5. Covered establishment as of 2013 that does not possess GHG emissions data for 2007-2010 and covered establishment after 2013 that is considered on a sectoral basis

(5.1) Calculation method for the years 2013 and 2014

Equation 5-1 Calculation of the number of GHG emission units allocated without charge by type of activity at an establishment covered as of 2013 and without data for 2007-2010 or covered after 2013 that is considered on a sectoral basis for the years 2013 and 2014

Ai j = max(Idep j;I2020s j) × PRi j

Where:

Ai j = Total number of GHG emission units allocated without charge by type of activity j for the establishment for year i;

i = Each year in the first compliance period, namely 2013 and 2014;

j = Type of activity;

max = Maximum value, representing the greater of the intensity values Idep j and I2020s j;

Idep j = Intensity target of the GHG emissions attributable to type of activity j at an establishment, calculated using equation 4-2, in metric tonnes CO2 equivalent per reference unit;

I2020s j = Intensity target of GHG emissions attributable to type of activity j in the sector for the year 2020, calculated using equation 3-2, in metric tonnes CO2 equivalent per reference unit;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

(5.2) Calculation method for the years 2015 to 2020

Equation 5-2 Calculation of the number of GHG emission units allocated without charge by type of activity for an establishment covered as of 2013 and without data for 2007-2010 or covered after 2013 that is considered on a sectoral basis for the years 2015 to 2020

                 _                                 _
                |m Idep j + (n - m)I2020S j         |
     Ai j = max |__________________________;I2020S j| × PRi j
                |_           n                     _|                                                        

Where:

Ai j = Total number of GHG emission units allocated without charge by type of activity j for the establishment for year i;

i = Each year in the period 2015-2020 for which the emitter is required to cover GHG emissions;

j = Type of activity;

max = Maximum value, representing the greater of the intensity values calculated;

m = 2020 – i;

n = Minimum, representing the lesser of 6 and (2020 – (d+1));

d = First year for which the GHG emissions of the establishment are equal to or exceed the emissions threshold.

Idep j = Intensity target of the GHG emissions attributable to type of activity j at an establishment, calculated using equation 3-2, in metric tonnes CO2 equivalent per reference unit;

I2020Sj = Intensity target of GHG emissions attributable to type of activity j in the sector for the year 2020, calculated using equation 3-2, in metric tonnes CO2 equivalent per reference unit;

PRi j = Total quantity of reference units produced or used at the establishment for type of activity j during year i.

6. Special cases

(6.1) Establishment producing aluminum using Söderberg anode technology after 2014

Equation 6-1 Calculation of the intensity target of GHG emissions for year 2020 at an establishment producing aluminum using Söderberg anode technology after 2014

I2020 sod = I 2020s electrolysis + (I2020s baked anode × 0.55)

Where:

I2020 sod = Intensity target of GHG emissions for year 2020 at an establishment producing aluminum using Söderberg anode technology after 2014, in metric tonnes CO2 equivalent per metric tonne of liquid aluminum;

I2020s electrolysis = Intensity target of GHG emissions for year 2020 in the aluminum sector for the type of activity “aluminum production”, calculated using equation 3-2 based on data from establishments using prebaked anode technology, in metric tonnes CO2 equivalent per metric tonne of liquid aluminum;

I2020s baked anode = Intensity target of GHG emissions for year 2020 in the aluminum sector for the type of activity “baked anode production”, calculated using equation 3-2 based on data from establishments using prebaked anode technology, in metric tonnes CO2 equivalent per metric tonne of baked anodes;

0.55 = Ratio between consumed baked anode production and aluminum production, in metric tonnes of baked anodes per metric tonne of liquid aluminum.

(6.2) Establishment producing alumina from bauxite

Equation 6-2 Calculation of the total quantity of GHG emission units allocated without charge for an establishment producing alumina from bauxite for 2013 to 2020

Ai = 0.40 × PRi

Where:

Ai = Total quantity of GHG emission units allocated without charge for an establishment producing alumina from bauxite for year i;

i = Each year included in the period 2013-2020;

0.40 = Intensity target of GHG emissions attributable to the production of alumina from bauxite for 2013 to 2020, in metric tonnes CO2 equivalent per metric tonne of aluminum hydrate (AI2O3 × 3 H2O) expressed as alumina (AI2O3) equivalent, 1 metric tonne of aluminum hydrate in alumina equivalent corresponding to 0.6536 metric tonnes aluminum hydrate;

PRi = Total quantity of aluminum hydrate expressed as alumina (Al2O3) equivalent produced at the establishment in year i, in metric tonnes.

(6.3) Establishment producing rigid foamed insulation

The total quantity of GHG emission units allocated without charge for an establishment producing rigid foamed insulation is calculated, for 2013 and 2014, using equation 2-1, where “I2013” is calculated using equations 6-3 to 6-6 and, for 2015 to 2020, using equation 6-7:

Equation 6-3 Calculation of the intensity target of GHG emissions attributable to an establishment producing rigid foamed insulation for 2013 and 2014

I 2013 = IFP + (R × IC) + IO

Where:

I 2013 = Intensity target of GHG emissions at the establishment for 2013 and 2014, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

IFP = Intensity of GHG fixed process emissions at the establishment for year 2010, calculated using equation 6-4, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

R = Multiplication factor for GHG combustion emissions intensity at the establishment, calculated using equations 4-6 and 4-7;

IC = Intensity of GHG combustion emissions at the establishment for year 2010, calculated using equation 6-5, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

IO = Intensity of other GHG emissions at the establishment for year 2010, calculated using equation 6-6, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation.

Equation 6-4 Intensity of GHG fixed process emissions at an establishment producing rigid foamed insulation for year 2010

           GHG FP2010
     IFP = __________
             PR2010
                                                        

Where:

IFP = Intensity of GHG fixed process emissions at the establishment for year 2010, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

GHG FP2010 = GHG fixed process emissions at the establishment for year 2010, in metric tonnes CO2 equivalent;

PR2010 = Total quantity of rigid foamed insulation produced at the establishment in year 2010, in board feet of rigid foamed insulation.

Equation 6-5 Intensity of GHG combustion emissions at an establishment producing rigid foamed insulation for year 2010

           GHG C 2010
     IC = __________
             PR 2010
                                                        

Where:

IC = Intensity of GHG combustion emissions at theestablishment for year 2010, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

GHG C 2010 = GHG combustion emissions at the establishment for year 2010, in metric tonnes CO2 equivalent;

PR 2010 = Total quantity of rigid foamed insulation produced at the establishment in year 2010, in board feet of rigid foamed insulation.

Equation 6-6 Intensity of other GHG emissions at an establishment producing rigid foamed insulation for year 2010

           GHG O 2010
     IO = __________
             PR 2010
                                                        

Where:

IO = Intensity of other GHG emissions at the establishment for year 2010, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

GHG O2010 = Other GHG emissions at the establishment for year 2010, in metric tonnes CO2 equivalent;

PR 2010 = Total quantity of rigid foamed insulation produced at the establishment in year 2010, in board feet of rigid foamed insulation.

Equation 6-7 Calculation of the total quantity of GHG emission units allocated without charge for an establishment producing rigid foamed insulation for 2015 to 2020

Ai [IFP + R(0.99)n IC + (0.99)n IO] × PRi

Where:

Ai = Total quantity of GHG emission units allocated without charge for an establishment producing rigid foamed insulation for year i;

i = Each year included in the period 2015-2020 for which the emitter is required to cover its GHG emissions;

IFP = Intensity of GHG fixed process emissions at the establishment for year 2010, calculated using equation 6-4, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

R = Multiplication factor for GHG combustion emissions intensity at the establishment, calculated using equations 4-6 and 4-7;

0.99 = Proportion corresponding to an annual improvement of 1% of the intensity factor;

n = i – 2015+1;

IC = Intensity of GHG combustion emissions at the establishment for year 2010, calculated using equation 6-5, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

IO = Intensity of other GHG emissions at the establishment for year 2010, calculated using equation 6-6, in metric tonnes CO2 equivalent per board foot of rigid foamed insulation;

PRi = Total quantity of rigid foamed insulation produced at the establishment in year i, in board feet of rigid foamed insulation.

(6.4) Establishment producing catalytic zinc and using hydrogen as a fuel to supply its furnaces

The total quantity of GHG emission units allocated without charge for an establishment producing zinc and using hydrogen as a fuel to supply its furnaces is calculated using equation 6-8 for 2013 and 2014 and using equation 6-9 for 2015 to 2020:

Equation 6-8 Calculation of the total quantity of GHG emission units allocated without charge to an establishment producing cathodic zinc and using hydrogen as a fuel to supply its furnaces for 2013 and 2014

Ai j = (I2013j + FH i) × PRi j

Where:

Ai j = Total quantity of GHG emission units allocated without charge for cathodic zinc production at the establishment for year i;

i = Each year included in the first compliance period, namely 2013 and 2014;

j = Type of activity, namely cathodic zinc production;

I2013j = Intensity target of GHG emissions attributable to the production of cathodic zinc at the establishment for 2013 and 2014, calculated using equation 2-2, in metric tonnes CO2 equivalent per metric tonne of cathodic zinc;

FH i = Adjustment factor for the partial or total loss of hydrogen supply for year i, calculated using equation 6-10;

PRi j = Total quantity of cathodic zinc produced at the establishment in year i, in metric tonnes of cathodic zinc.

Equation 6-9 Calculation of the total quantity of GHG emission units allocated without charge to an establishment producing cathodic zinc and using hydrogen as a fuel to supply its furnaces for 2015 to 2020

Where:

Ai j = Total quantity of GHG emission units allocated without charge for cathodic zinc production at the establishment for year i;

i = Each year included in the second and third compliance periods, namely 2015, 2016, 2017, 2018, 2019 and 2020;

j = Type of activity, namely cathodic zinc production;

6 = Six years in the linear regression, namely 2015, 2016, 2017, 2018, 2019 and 2020;

x = (i – 2015) + 1;

I2013j = Intensity target of GHG emissions attributable to the production of cathodic zinc at the establishment for 2013 and 2014, calculated using equation 2-2, in metric tonnes CO2 equivalent per metric tonne of cathodic zinc;

I2020j = Intensity target of GHG emissions attributable to the production of cathodic zinc at the establishment for year 2020, calculated using equation 2-8, in metric tonnes CO2 equivalent per metric tonne of cathodic zinc;

FH i = Adjustment factor for the partial or total loss of hydrogen supply for year i calculated using equation 6-10;

PRi j = Total quantity of cathodic zinc produced at the establishment for year i, in metric tonnes of cathodic zinc.

Equation 6-10 Calculation of the adjustment factor for the partial or total loss of hydrogen supply

>

Where:

FHi = Adjustment factor for the partial or total loss of hydrogen supply for year i;

i = Each year included in the period 2013-2020 for which the emitter is required to cover its GHG emissions;

0.060 = Minimum ratio between the annual consumption of hydrogen and the annual production from 2007 to 2010, in cubic kilometres of hydrogen per metric tonne of cathodic zinc;

H2,i = Hydrogen consumption for year i, in cubic kilometres;

PRi j = Total quantity of cathodic zinc produced at the establishment for year i, in metric tonnes of cathodic zinc;

0.3325 = Volume equivalency factor for hydrogen and natural gas, in cubic kilometres of natural gas per cubic kilometre of hydrogen;

1.889 = Emission factor for natural gas, in metric tonnes CO2 equivalent par cubic kilometre of natural gas;

0.80 = Proportion corresponding to 80% combustion emission intensity;

0.99 = Proportion corresponding to an annual improvement of 1% of the intensity factor;

n = Value of 0 for 2013 and 2014, or (i-2015 +1) for 2015 to 2020.

6.5 New facility or production of a new reference unit

An emitter must, as soon as possible, notify the Minister of any new facility on the site of one of the emitter’s covered establishments or of the production of any new reference unit by submitting the following information:

(1) the name and contact information of the enterprise and of the establishment where the new facility is located or where the new reference unit is produced;

(2) the business number assigned to the emitter pursuant to the Act respecting the legal publicity of enterprises (chapter P-44.1), along with the identification number assigned under the National Pollutant Release Inventory of the Government of Canada, if any;

(3) where production at the new facility replaces all or some production at one of the emitter’s establishments or facilities in Québec that closed after 1 January 2008, the name and contact information of the establishment or facility that closed;

(4) the average annual quantity of reference units produced or used, by type of activity, at the closed establishment or facility during the 3 complete years preceding its closure.

(6.5.1) New facility at which production does not replace production at another establishment or facility

The quantity of GHG emission units allocated without charge to an emitter to take into account a new facility located on the site of one of the emitter’s covered establishments at which production does not replace production at another establishment or facility is calculated

(1) in the case of a facility that is not considered on a sectoral basis, using equations 4-1 to 4-8;

(2) in the case of a facility that is considered on a sectoral basis, using equations 5-1 and 5-2.

(6.5.2) New facility of an emitter at which production replaces all or some production at another of the emitter’s establishments or facilities in Québec that closed after 1 January 2008

The quantity of GHG emission units allocated without charge to an emitter to take into account a new facility located on the site of one of the emitter’s covered establishments at which production replaces all or some production at another of the emitter’s establishments or facilities in Québec that closed after 1 January 2008 is calculated.

(1) for any annual quantity of reference units produced or used by the new facility not exceeding the average annual quantity of reference units produced or used, by type of activity, at the closed establishment or facility during the 3 complete years preceding its closure:

(a) in the case of a facility that is not considered on a sectoral basis, using equations 1-1 and 2-1 to 2-9 and applying equations 2-2 to 2-8 based on data from the closed establishment or facility;

(b) in the case of a facility considered on a sectoral basis, using equations 1-1 and 3-1 to 3-10 and applying equations 3-2 to 3-9 based on data from the closed establishment or facility;

(2) for any annual quantity of reference units produced or used by the new facility that exceeds the average annual quantity of reference units produced or used, by type of activity, at the closed establishment or facility during the 3 complete years preceding its closure:

(a) in the case of a facility that is not considered on a sectoral basis, using equations 4-1 to 4-8;

(b) in the case of a facility considered on a sectoral basis, using equations 5-1 and 5-2.

(6.5.3) Production of a new reference unit

The quantity of GHG emission units allocated without charge to an emitter to take into account the production of a new reference unit at a facility of one of its covered establishments must be calculated

(1) in the case of a facility that is not considered on a sectoral basis, using equations 4-1 to 4-8;

(2) in the case of a facility considered on a sectoral basis, using equations 5-1 and 5-2.

For the application of the equations set out in the first paragraph, factors d and i are replaced by the following:

d = First year of production of the new reference unit;

i = Years d-2, d-1 and d+1, where available, excluding the first year of production of the new reference unit.

(6.6) Establishment covered after 2013 at which production replaces all or some production at one of the emitter’s establishments or facilities in Québec that closed after 1 January 2008

Every emitter, at one of whose establishments covered after 2013 production replaces all or some production at another of the emitter’s establishments or facilities in Québec that closed after 1 January 2008, must, as soon as possible, notify the Minister by submitting the following information:

(1) the name and contact information of the enterprise and the establishment;

(2) the business number assigned to the emitter pursuant to the Act respecting the legal publicity of enterprises (chapter P-44.1), along with the identification number assigned under the National Pollutant Release Inventory of the Government of Canada, if any;

(3) the name and contact information of the replaced establishment or facility;

(4) the quantity, by type of activity, of reference units produced or used at the closed establishment or facility.

The quantity of GHG emission units allocated without charge to the emitter for the establishment is calculated

(1) for any annual quantity of reference units produced or used at the establishment not exceeding the average annual quantity of reference units produced or used, by type of activity, at the closed establishment or facility during the 3 complete years preceding its closure:

(a) in the case of an establishment that is not considered on a sectoral basis, using equations 1-1 and 2-1 to 2-9 and applying equations 2-2 to 2-8 based on data from the closed establishment or facility;

(b) in the case of an establishment that is considered on a sectoral basis, using equations 1-1 and 3-1 to 3-10 and applying equations 3-2 to 3-9 based on data from the closed establishment or facility;

(2) for any annual quantity of reference units produced or used at the establishment that exceeds the average annual quantity of reference units produced or used, by type of activity, at the closed establishment or facility during the 3 complete years preceding its closure:

(a) in the case of an establishment that is not considered on a sectoral basis, using equations 4-1 to 4-8;

(b) in the case of an establishment that is considered on a sectoral basis, using equations 5-1 and 5-2.

(6.7) Enterprise that acquires, for consumption of the enterprise or for sale in Québec, power generated in another Canadian province or territory or in a US state where a system covering electricity production in particular has been established by an entity that is not a partner entity

Equation 6-11 Calculation of the total GHG emission units allocated free of charge to an enterprise that acquires, for consumption of the enterprise or for sale in Québec, power generated in another Canadian province or territory or in a US state where a system covering electricity production in particular has been established by an entity that is not a partner entity

          PiNon-WCI
     Ai = ________ × EiNon-WCI
           PiWCI
                                                        

Where:

Ai = Number of emission units allocated free of charge for year i;

PiNon-WCI = Weighted average sale price of emission allowances of year i at an auction held during year i by other Canadian provinces or territories or by US states where a system covering electricity production in particular has been established by an entity that is not a partner entity, in US dollars;

PiWCI = Weighted average sale price of emission allowances of year i at an auction held during year i by Québec or other Canadian provinces or territories or by US states where a system covering electricity production in particular has been established by a partner entity, in US dollars;

EiNon-WCI = Annual GHG emissions for year i relating to the production of electricity acquired from another Canadian province or territory or from a US state where producers are subject to a system established by an entity that is not a partner entity, in metric tonnes CO2 equivalent;

i = Each year of the 2013-2020 period for which the emitter is required to cover its emissions.

For the purposes of this equation, where the sale price of the emission allowances that is used for calculation is only available in Canadian dollars, the price must be converted in US dollars at the official conversion rate of the Bank of Canada at noon on the date of the auction.

(6.8) Copper foundry.

The total quantity of GHG emission units allocated free of charge to a copper foundry is calculated using equation 6-12 for years 2013 and 2014 and using equation 6-13 for years 2015 to 2020:

Equation 6-12 Calculation of the total quantity of GHG emission units allocated free of charge to a copper foundry for years 2013 and 2014

Ai = (I2013cu × PR cu,i) + (I2013 RMS × PR RSM,i) + Arecycl ,i

Where:

Ai = Total quantity of GHG emission units allocated free of charge for the production of copper anodes at the establishment for year i;

i = Each year included in the first compliance period, namely 2013 and 2014;

I2013cu = Intensity target of GHG emissions attributable to the production of copper anodes at the establishment for years 2013 and 2014, calculated using equation 2-2, in metric tonnes CO2 equivalent per metric tonne of copper anodes;

PRi,cu = Total quantity of copper anodes produced by the establishment during year i, in metric tonnes of copper anodes;

I2013RSM = Intensity target for GHG emissions attributable to the treatment of gas from the recycling of secondary materials at the establishment for 2013 and 2014, calculated using equation 2-2, in metric tonnes CO2 equivalent per metric tonne of recycled secondary materials;

PR RSM,i = Total quantity of secondary materials recycled at the establishment in year i, in metric tonnes of recycled secondary materials;

Arecycl,i = GHG emissions attributable to the carbon content of recycled secondary materials introduced into the process materials for year i, in metric tonnes CO2 equivalent;

Equation 6-13 Calculation of the total quantity of GHG emission units allocated free of charge to a copper foundry for years 2015 to 2020

Where:

Ai = Total quantity of GHG emission units allocated free of charge for the production of copper anodes at the establishment for year i;

i = Each year included in the second and third compliance periods, namely 2015, 2016, 2017, 2018, 2019 and 2020;

6 = Six years in the linear regression, namely 2015, 2016, 2017, 2018, 2019 and 2020;

x = (i – 2015) + 1;

I2013cu = Intensity target of GHG emissions attributable to the production of copper anodes at the establishment for years 2013 and 2014, calculated using equation 2-2, in metric tonnes CO2 equivalent per metric tonne of copper anodes;

I2020cu = Intensity target of GHG emissions attributable to the production of copper anodes, calculated using equation 2-8, in metric tonnes CO2 equivalent per metric tonne of copper anodes;

PRi,cu, i = Total quantity of copper anodes produced by the establishment during year i, in metric tonnes of copper anodes;

I2013RSM = Intensity target for GHG emissions attributable to gas from the recycling of secondary materials at the establishment for 2013 and 2014, calculated using equation 2-2, in metric tonnes CO2 equivalent per metric tonne of recycled secondary materials;

I2020RSM = Intensity target for GHG emissions attributable to the treatment of gas from the recycling of secondary materials, calculated using equation 2-8, in metric tonnes CO2 per metric tonne of recycled secondary materials;

PR RSM,i = Total quantity of secondary materials recycled at the establishment in year i, in metric tonnes of recycled secondary materials;

Arecycl,i = GHG emissions attributable to the carbon content of recycled secondary materials introduced in the process materials for year i, in metric tonnes CO2 equivalent.

For the application of equations 6-12 and 6-13, recycled secondary materials used in a process at a copper foundry are deemed to be all materials used in the process other than fuel, ore, reducing agents, materials used for slag purification, carbonated reactants and carbon electrodes.

O.C. 1297-2011, Sch. C; O.C. 1184-2012, s. 51; O.C. 1138-2013, s. 28; O.C. 902-2014, s. 65; O.C. 1089-2015, s. 30.

APPENDIX D

(ss. 70.1 to 70.22)

This Appendix is deemed to be a regulation of the Minister made under the second paragraph of section 46.8 of the Envrironment Quality Act. (S.Q. 2017, c. 4, s. 285)

Offset credit protocols

For the purposes of these protocols,

(1) “standard conditions” means a temperature of 20 °C and pressure of 101.325 kPa;

(2) “SSR” means GHG sources, sinks and reservoirs on the project site.

PROTOCOL 1

COVERED MANURE STORAGE FACILITIES – CH4 DESTRUCTION

Part I

(1) Projects covered

This offset credit protocol covers any project designed to reduce GHG emissions by destroying the CH4 attributable to the manure of an agricultural operation in Québec raising one of the species of livestock listed in the tables in Part II.

The project involves the installation of a manure storage facility cover and a fixed CH4 destruction device.

The project must enable to capture and destroy CH4 that, before the project, was emitted to the atmosphere. The CH4 must be destroyed on the site of the manure storage facility where the CH4 was captured, using a flare or any other device.

For the purposes of this protocol, “manure” means livestock waste with liquid manure management within the meaning of the Agricultural Operations Regulation (chapter Q-2, r. 26).

(2) Location

The project must be carried out within the borders of the province of Québec.

(3) Reduction project SSRs

The process flow chart in Figure 3.1 and the table in Figure 3.2 show all the SSRs that must be taken into account by the promoter when calculating the GHG emission reductions attributable to the project.

All the SSRs within the dotted line must be counted for the purposes of this protocol.

Figure 3.1. Flowchart for the reduction project process

Figure 3.2. Reduction project SSRs

 _________________________________________________________________________________
|     |                                          |       |             |          |
| SSR | Description                              |  GHG  | Relevant to | Included |
| #   |                                          |       | project     |    or    |
|     |                                          |       | baseline    | Excluded |
|     |                                          |       | scenario (B)|          |
|     |                                          |       | and/or      |          |
|     |                                          |       | Project (P) |          |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  1  | Enteric fermentation                     |  CH4  |    B, P     | Excluded |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  2  | Manure collection                        |  CH4  |             | Excluded |
|     |                                          |  CO2  |    B, P     | Excluded |
|     |                                          |  N2O  |             | Excluded |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  3  | Manure storage                           |  CH4  |             | Included |
|     |                                          |  CO2  |    B, P     | Excluded |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  4  | Manure transportation                    |  CH4  |             | Excluded |
|     |                                          |  CO2  |    B, P     | Excluded |
|     |                                          |  N2O  |             | Excluded |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  5  | Manure spreading                         |  CH4  |             | Excluded |
|     |                                          |  CO2  |    B, P     | Excluded |
|     |                                          |  N2O  |             | Excluded |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  6  | Flare                                    |  CH4  |             | Included |
|     |                                          |  CO2  |      P      | Excluded |
|     |                                          |  N2O  |             | Included |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  7  | Other CH4 destruction device             |  CH4  |             | Included |
|     |                                          |  CO2  |      P      | Excluded |
|     |                                          |  N2O  |             | Included |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  8  | Construction of project facilities       |  CH4  |             | Excluded |
|     |                                          |  CO2  |      P      | Excluded |
|     |                                          |  N2O  |             | Excluded |
|_____|__________________________________________|_______|_____________|__________|
|     |                                          |       |             |          |
|  9  | Equipment using fossil fuel              |  CH4  |             | Included |
|     |                                          |  CO2  |    B, P     | Included |
|     |                                          |  N2O  |             | Included |
|_____|__________________________________________|_______|_____________|__________|                    

(4) Calculation method for the GHG emission reductions attributable to the project

The promoter must calculate the quantity of GHG emission reductions attributable to the project using equation 1:

Equation 1

Where:

ER = Reductions in GHG emissions attributable to the project during the project reporting period, in metric tonnes CO2 equivalent;

GHG project = Gross reduction in GHG emissions from the project during the project reporting period, calculated using equation 2, in metric tonnes CO2 equivalent;

/\GHG fossil = Differential between GHG emissions in the baseline scenario and GHG emissions for the project attributable to the fossil fuels consumed in the operation of equipment within the project SSRs, during the project reporting period, calculated using equation 9, in metric tonnes CO2 equivalent.

(4.1) Calculation method for gross GHG emission reductions

The promoter must calculate the quantity of gross GHG emission reductions attributable to the project using equations 2 to 8:

Equation 2

GHG project = GHG dest flare - GHG combustion flare + GHG dest other - GHG combustion other

Where:

GHG project = Gross reduction in GHG emissions attributable to the project during the project reporting period, in metric tonnes CO2 equivalent;

GHG dest flare = Lesser of the CH4 emissions destroyed at flare during the project reporting period and 90% of the emissions from an uncovered manure storage facility, calculated using equation 3, in metric tonnes CO2 equivalent;

GHG combustion flare = N2O emissions attributable to combustion of captured gas at flare during the project reporting period, calculated using equation 6, in metric tonnes CO2 equivalent;

GHG dest other = Lesser of the CH4 emissions destroyed by a destruction device other than a flare during the project reporting period and 90% of the emissions from an uncovered manure storage facility, calculated using equation 7, in metric tonnes CO2 equivalent;

GHG combustion other = N2O emissions attributable to combustion of captured gas by a destruction device other than a flare during the project reporting period, calculated using equation 8.1, in metric tonnes CO2 equivalent;

Equation 3

GHG dest flare = Min [GHG flare; GHG EF]

Where:

GHG dest flare = Lesser of the CH4 emissions destroyed at flare during the project reporting period and 90% of the emissions from an uncovered manure storage facility, in metric tonnes CO2 equivalent;

Min = Lesser of the 2 elements calculated;

GHG flare = CH4 emissions destroyed at flare during the project reporting period, calculated using equation 4, in metric tonnes CO2 equivalent;

GHG EF = 90% of emissions from an uncovered manure storage facility, calculated using equation 5, in metric tonnes CO2 equivalent;

Equation 4

Where:

GHG flare = CH4 emissions destroyed at flare during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of days on which gas is produced during the project reporting period;

j = Day on which gas is produced at the manure storage facility;

Q gas cov = Quantity of gas available for burning on day j measured at the capture system before delivery to the flare, in cubic metres at standard conditions;

EFF flare = Flare burning efficiency rate, namely:

— for an open flare, a rate of 0.96 when the flare is operated in accordance with the method General control device and work practice requirements in Part 60.18 of Title 40 of the Code of Federal Regulation published by the U.S. Environmental Protection Agency (USEPA), or a rate of 0.5 in other cases;

— for an enclosed flare, a rate of 0.98 when the gas retention time in the stack is at least 0.3 seconds, or a rate of 0.9 in other cases;

C CH4 = Average CH4 content in the gas burned on day j, determined in accordance with Part III, in cubic metres of CH4 per cubic metre of gas;

0.667 = Density of CH4, in kilograms per cubic metre at standard conditions;

21 = Global Warming Potential factor of CH4;

0.001 = Conversion factor, kilograms to metric tonnes;

Equation 5

Where:

GHG EF = 90% of the emissions from a non-covered manure storage facility, in metric tonnes CO2 equivalent;

n = Number of categories of livestock;

i = Category of livestock listed in the tables in Part II;

Nbi = Population of category of livestock i during the project reporting period, in head of livestock;

EFi = CH4 emission factor for category of livestock i, specified in the tables in Part II, in kilograms of CH4 per head per year;

21 = Global Warming Potential factor of CH4;

0.001 = Conversion factor, kilograms to metric tonnes;

0.9 = 90%;

Equation 6

Where:

GHG combustion flare = N2O emissions attributable to combustion of captured gas at flare during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of days on which gas is produced during the project reporting period;

j = Day on which gas is produced at the manure storage facility vent;

Q gas cov = Quantity of gas available for burning on day j measured at the capture system before delivery to the flare, in cubic metres at standard conditions;

EFF flare = Flare burning efficiency rate, namely:

— for an open flare, a rate of 0.96 when the flare is operated in accordance with the method “General control device and work practice requirements” in Part 60.18 of Title 40 of the Code of Federal Regulations published by the U.S. Environmental Protection Agency (USEPA), or a rate of 0.5 in other cases;

— for an enclosed flare, a rate of 0.98 when the gas retention time in the stack is at least 0.3 seconds, or a rate of 0.9 in other cases;

C CH4 = Average CH4 content in the gas burned on day j, determined in accordance with Part III, in cubic metres of CH4 per cubic metre of gas;

0.049 = N2O emission factor attributable to flare burning, in grams of N2O per cubic metre of gas burned;

310 = Global Warming Potential factor of N2O;

0.000001 = Conversion factor, grams to metric tonnes;

Equation 7

GHG dest other = Min [GHG other ; GHG EF]

Where:

GHG dest other = Lesser of CH4 emissions destroyed by a destruction device other than a flare during the project reporting period and 90% of emissions from an uncovered manure storage facility, in metric tonnes CO2 equivalent;

Min = Lesser of the 2 elements calculated;

GHG other = CH4 emissions destroyed by the destruction device other than a flare during the project reporting period, calculated using equation 8, in metric tonnes CO2 equivalent;

GHG EF = 90% of the emissions from a non-covered manure storage facility, calculated using equation 5, in metric tonnes CO2 equivalent;

Equation 8

Where:

GHG other = CH4 emissions destroyed by a destruction device other than a flare during the project reporting period, in metric tonnes CO2 equivalent;

Q gas cov = Quantity of gas available for destruction during the project reporting period, measured at the capture system prior to destruction, in cubic metres at standard conditions;

C CH4 = Average CH4 content in the gas before entering the destruction device during the project reporting period, determined in accordance with Part III, in cubic metres of CH4 per cubic metre of gas;

C dest-CH4 = Average CH4 content in the gas leaving the destruction device during the project reporting period, determined in accordance with the method in Part V, in cubic metres of CH4 per cubic metre of gas;

0.667 = Density of CH4, in kilograms per cubic metre at standard conditions;

21 = Global Warming Potential factor of CH4;

0.001 = Conversion factor, kilograms to metric tonnes.

Equation 8.1

GHG combustion other = Q gas cov × (C dest-N2O × 1.84 × 310) × 0.001

Where:

GHG combustion other = N2O emissions attributable to combustion of captured gas by a destruction device other than a flare during the project reporting period, in metric tonnes CO2 equivalent;

Q gas cov = Quantity of gas available for destruction during the project reporting period, measured at the capture system prior to destruction, in cubic metres at standard conditions;

C dest-N2O = Average N2O content in the gas leaving the destruction device during the project reporting period, determined in accordance with the method in Part V, in cubic metres of N2O per cubic metre of gas;

1.84 = Density of N2O, in kilograms per cubic metre at standard conditions;

310 = Global Warming Potential factor of N2O;

0.001 = Conversion factor, kilograms to metric tonnes.

(4.2) Calculation method for GHG emissions attributable to fossil fuels

The promoter must calculate, using equation 9, the differential between the GHG emissions for the baseline scenario and the GHG emissions for the project attributable to fossil fuels using equation 9.

If the GHG emissions for the project are above the GHG emissions for the baseline scenario, the latter are subtracted from the reductions in accordance with equation 1. In other cases, the factor “/\GHG fossil” for equation 1 is 0.

Equation 9

Where:

/\GHG fossil = Differential between the GHG emissions for the baseline scenario and the GHG emissions for the project attributable to fossil fuels during the project reporting period, in metric tonnes CO2 equivalent;

m = Number of fossil fuels;

j = Fossil fuel;

C project = Quantity of fossil fuel j consumed in the operation of equipment within the project SSRs during the project reporting period, expressed

— in kilograms, in the case of fuels whose quantity is expressed as a mass;

— in cubic metres at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in litres, in the case of fuels whose quantity is expressed as a volume of liquid;

C SF = Quantity of fossil fuel j consumed in the operation of equipment within the SSRs included in the baseline scenario during the project reporting period, expressed

— in kilograms, in the case of fuels whose quantity is expressed as a mass;

— in cubic metres at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in litres, in the case of fuels whose quantity is expressed as a volume of liquid;

FCO2 = CO2 emission factor for fuel j specified in tables 1-3 to 1-8 of QC.1.7 in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), expressed

— in kilograms of CO2 per kilogram, in the case of fuels whose quantity is expressed as a mass;

— in kilograms of CO2 per cubic metre at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in kilograms of CO2 per litre, in the case of fuels whose quantity is expressed as a volume of liquid;

0.001 = Conversion factor, kilograms to metric tonnes;

FCH4 = CH4 emission factor for fuel j specified in tables 1-3 to 1-8 of QC.1.7 in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere, expressed

— in grams of CH4 per kilogram, in the case of fuels whose quantity is expressed as a mass;

— in grams of CH4 per cubic metre at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in grams of CH4 per litre, in the case of fuels whose quantity is expressed as a volume of liquid;

0.000001= Conversion factor, grams to metric tonnes;

21 = Global Warming Potential factor of CH4;

FN2O = N2O emission factor for fuel j specified in tables 1-3 to 1-8 of QC.1.7 in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere, expressed

— in grams of N2O per kilogram, in the case of fuels whose quantity is expressed as a mass;

— in grams of N2O per cubic metre at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in grams of N2O per litre, in the case of fuels whose quantity is expressed as a volume of liquid;

310 = Global Warming Potential factor of N2O.

(5) Data management and project surveillance

(5.1) Data collection

The project promoter is responsible for collecting the information required for project monitoring.

The promoter must show that the data collected at the agricultural operation are actual and properly represent production during the period covered by each project report. The promoter must also keep a livestock raising register for the agricultural operation.

(5.2) Surveillance plan

The promoter must establish a surveillance plan to measure and monitor project parameters in accordance with Figure 5.1:

Figure 5.1. Project surveillance plan

 _________________________________________________________________________________
|                 |           |                |               |                  |
|Parameter        |Factor used|Unit of         |Method         |Frequency of      |
|                 |in the     |measurement     |               |measurement       |
|                 |equations  |                |               |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|Average annual   |Nb         |Head            |Livestock      |At each project   |
|population of    |           |                |raising        |reporting period  |
|each category    |           |                |register       |                  |
|of livestock     |           |                |               |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|Outdoor          |N/A        |Degree Kelvin   |As measured, or|Daily average     |
|temperature      |           |                |according to   |                  |
|                 |           |                |Environment    |                  |
|                 |           |                |Canada         |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|Quantity of gas  |Q gas cov  |Cubic metre     |Flow meter     |At each project   |
|available for    |           |                |               |reporting period  |
|destruction      |           |                |               |(sum of daily     |
|during the       |           |                |               |readings)         |
|project reporting|           |                |               |                  |
|period           |           |                |               |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|CH4 content      |C CH4      |Cubic metre of  |Sample and     |Quarterly, in     |
|between the      |           |CH4 per cubic   |analysis       |accordance with   |
|manure storage   |           |metre of gas at |               |Part III          |
|facility and the |           |standard        |               |                  |
|destruction      |           |conditions      |               |                  |
|device           |           |                |               |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|CH4 content      |C dest-CH4 |Cubic metre of  |Sample and     |Quarterly, in     |
|leaving the      |           |CH4 per cubic   |analysis       |accordance with   |
|destruction      |           |metre of gas at |               |Part V            |
|device (other    |           |standard        |               |                  |
|than a flare)    |           |conditions      |               |                  |
|                 |           |                |               |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|N2O content      |C dest-N2O |Cubic metre of  |Sample and     |Quarterly, in     |
|leaving the      |           |N2O per cubic   |analysis       |accordance with   |
|destruction      |           |metre of gas at |               |Part V            |
|device (other    |           |standard        |               |                  |
|than a flare)    |           |conditions      |               |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|Quantity of      |C project  |Kilogram (solid)|Purchase       |At each project   |
|fossil fuel used |           |                |invoices       |reporting period  |
|to operate       |           |Cubic metre     |               |                  |
|equipment within |           |(gas)           |               |                  |
|the project SSRs |           |                |               |                  |
|during the       |           |Litres (liquid) |               |                  |
|project reporting|           |                |               |                  |
|period           |           |                |               |                  |
|_________________|___________|________________|_______________|__________________|
|                 |           |                |               |                  |
|Quantity of      |C SF       |Kilogram (solid)|Purchase       |At each project   |
|fossil fuel used |           |                |invoices       |reporting period  |
|to operate       |           |Cubic metre     |               |                  |
|equipment within |           |(gas)           |               |                  |
|the project SSRs |           |                |               |                  |
|for the baseline |           |Litres (liquid) |               |                  |
|scenario, during |           |                |               |                  |
|the project      |           |                |               |                  |
|reporting period |           |                |               |                  |
|_________________|___________|________________|_______________|__________________|

                     

The promoter is responsible for operating the project and monitoring project performance. The promoter must use the CH4 destruction device and the measurement instruments in accordance with the manufacturer’s specifications. The promoter must, in particular, use measurement instruments to measure directly

(1) the flow of gas before being delivered to the destruction device, continuously, recorded every 15 minutes or totalized and recorded at least daily, adjusted for temperature and pressure; and

(2) the CH4 content in the gas entering the destruction device, determined in accordance with the applicable method in Part III;

(3) the CH4 and N2O content in the gas leaving the destruction device, determined in accordance with the applicable method in Part V, when a destruction device other than a flare is used.

The promoter must monitor and document the use of the destruction device at least once per day to ensure the destruction of the CH4. A flare must be equipped with a monitoring device, such as a thermocouple, at its output that certifies correct operation. GHG emission reductions will not be taken into account for the issue of offset credits for periods during which the destruction device is not operating.

When a destruction device or an operation monitoring device, such as a thermocouple on a flare, is not operating, all the CH4 measured as being delivered to the destruction device must be considered as being emitted to the atmosphere during the period of non-operation. The destruction efficiency of the device must be considered to be zero.

(5.3) CH4 and N2O measurement instruments

The promoter must ensure that all gas flow meters and analyzers are

(1) cleaned and inspected on a quarterly basis, except from December to March;

(2) not more than 2 months before the project reporting period end date, checked for calibration accuracy by a qualified and independent person, using a portable instrument or manufacturer’s specifications, and ensure that the percentage drift is recorded; and

(3) calibrated by the manufacturer or by a third person certified for that purpose, every 5 years or according to the manufacturer’s specifications, whichever is more frequent.

When a check on a piece of equipment reveals accuracy outside a ± 5% threshold,

(1) the piece of equipment must be calibrated by the manufacturer, or by a third person certified for that purpose by the manufacturer; and

(2) all the data from the meters and analyzers must be scaled according to the following procedure:

(a) the data must be adjusted for the entire period from the last calibration that confirmed accuracy within the ± 5% threshold until such time as the flow meter and analyzer is correctly calibrated; and

(b) the project promoter must estimate the GHG emission reductions using the lesser of the measured flow values without correction and the measured flow values adjusted based on the greatest calibration drift recorded.

The last calibration confirming accuracy within the ± 5% threshold must not have taken place more than 2 months before the end date for the project reporting period.

If a portable instrument is used, such as a handheld CH4 analyzer, it must be calibrated at least annually by the manufacturer or by an ISO 17025 accredited laboratory.

(5.4) Data management

The data must be of sufficient quality to meet the calculation requirements and be confirmed by the livestock raising registers of the agricultural operation during the verification.

The project promoter must establish written procedures for each task involving measurements, indicating the person responsible, the frequency and time of the measurements, and the place where the registers are kept.

In addition, the registers must be

(1) legible, dated and revised if needed;

(2) kept in good condition; and

(3) kept in a place that is easily accessible for the duration of the project.

(5.5) Missing data – replacement methods

In situations where data on gas flow rates or CH4 or N2O content are missing, the promoter must apply the data replacement methods set out in Part VI. Missing data on gas flow rates may be replaced only when a continuous analyzer is used to measure CH4 and N2O content. When CH4 and N2O content is measured by sampling, no missing data is permissible.

Part II

Emission factors for the management of manure from livestock

Table 1. CH4 emission factors for the management of manure from dairy and non-dairy cattle

 _________________________________________________________________________________
|                                        |                                        |
| Category                               |          CH4 emission factor           |
|                                        |     Kilograms of CH4 / head / year     |
|________________________________________|________________________________________|
|                                        |                                        |
| Dairy cow                              |                  27.8                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Dairy heifer                           |                  19.1                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Bull                                   |                   3.3                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Slaughter cow                          |                   3.2                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Slaughter heifer                       |                   2.4                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Steer                                  |                   1.6                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Backgrounding cattle                   |                   1.8                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Dairy calf or dairy heifer calf        |                   1.5                  |
|________________________________________|________________________________________|                    

Table 2. CH4 emission factors for the management of manure from other categories of livestock

 _________________________________________________________________________________
|                                        |                                        |
| Category                               |          CH4 emission factor           |
|                                        |     Kilograms of CH4 / head / year     |
|________________________________________|________________________________________|
|                                        |                                        |
| Piglet                                 |                  1.66                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Hog                                    |                  6.48                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Sow                                    |                  7.71                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Boar                                   |                  6.40                  |
|________________________________________|________________________________________|                    

Part III

Determination of the CH4 content of gas available for burning measured at the capture system before delivery to the flare or other destruction device

When the project is not equipped with a continuous CH4 analyzer, the promoter must sample the gas sent to the destruction device when the device is in operation during the 4 following periods each year:

Sample 1: April – May

Sample 2: June – July

Sample 3: August – September

Sample 4: October – November

To be representative, each sampling must measure concentration, gas flow rate and air temperature during 8 hours, continuously or over several shorter periods. Enough data must be collected to establish a graph of CH4 content as a function of temperature.

The graph will be used to determine CH4 content on days when the gas is not sampled, when the average temperature is known.

The promoter must

(1) sample the gases, measure the gas flow rate and measure the ambient temperature;

(2) produce a graph showing CH4 content as a function of temperature;

(3) determine the average ambient temperature for a given day;

(4) using the graph, determine CH4 content as a function of temperature for each operating period of the destruction device; and

(5) complete the monitoring grid in Part IV.

Part IV

Monitoring grid

 _________________________________________________________________________________
|      |           |             |           |            |                      |
| Date | Q gaz cov  | Ambient     | CCH4      | GHG flare   | GHG combustion flare   |
|      | m3        | temperature | in m3 of  | or         | or                   |
|      | measured  | measured in | CH4 per   | GHG other  | GHG combustion other   |
|      |           | Kelvin      | m3 of gas | in CO2     | in CO2 equivalent,   |
|      |           |             |           | equivalent,| using equation 6 or  |
|      |           |             |           | using      | 8.1                  |
|      |           |             |           | equation 4 |                      |
|      |           |             |           | or 8       |                      |
|______|___________|_____________|___________|____________|______________________|
|      |           |             |           |            |                      |
|______|___________|_____________|___________|____________|______________________|
|      |           |             |           |            |                      |
|______|___________|_____________|___________|____________|______________________|
|      |           |             |           |            |                      |
|______|___________|_____________|___________|____________|______________________|
|      |           |             |           |            |                      |
|______|___________|_____________|___________|____________|______________________|  
                      

Part V

Determination of the CH4 and N2O content of gas leaving a destruction device other than a flare

When the project is not equipped with a continuous CH4 or N2O analyzer, the promoter must sample the available gas leaving the destruction device during the 4 following periods each year:

Sample 1: April – May

Sample 2: June – July

Sample 3: August – September

Sample 4: October – November

The promoter must determine the average CH4 content during the project reporting period using equation 10 and the average N2O content using equation 11:

Equation 10

Where:

C dest-CH4 = Average CH4 content of gas leaving the destruction device during the project reporting period, in cubic metres of CH4 per cubic metre of gas at standard conditions;

n = Number of samples;

i = Sample;

Cs CH4,i = CH4 content of sample i, measured in the gas leaving the destruction device, in cubic metres of CH4 per cubic metre of gas at standard conditions;

Equation 11

Where:

Cdest-N2O = Average N2O content of gas leaving the destruction system during the project reporting period, in cubic metres of N2O per cubic metre of gas at standard conditions;

n = Number of samples;

i = Sample;

Cs N2O,i = N2O content of sample i, measured in the gas leaving the destruction system, in cubic metres of N2O per cubic metre of gas at standard conditions.

Part VI

Missing data – replacement methods

The replacement methods below may be used only

(1) for CH4 or N2O content or gas flow rate parameters;

(2) for data gaps on gas flow rates that are discrete, non-chronic and due to unforeseen circumstances;

(3) when the proper functioning of the destruction device can be shown by reading the thermocouple at the flare or other device;

(4) when data on gas flow rate only, or CH4 or N2O content only, are missing;

(5) to replace data on gas flow rates when a continuous analyzer is used to measure CH4 and N2O content and when it is shown that CH4 and N2O content was consistent with normal operations for the time when the data are missing; and

(6) to replace data on CH4 and N2O content when it is shown that the gas flow rate was consistent with normal operations for the time when the data are missing.

No offset credit may be issued for periods when the replacement methods cannot be used.

 _________________________________________________________________________________
|                               |                                                 |
| Missing data period           | Replacement method                              |
|_______________________________|_________________________________________________|
|                               |                                                 |
| Less than 6 hours             | Use the average of the 4 hours immediately      |
|                               | before and following the missing data period    |
|_______________________________|_________________________________________________|
|                               |                                                 |
| 6 to less than 24 hour        | Use the 90% lower or upper confidence limit of  |
|                               | the 24 hours prior to and after the missing     |
|                               | data period, whichever results in greater       |
|                               | conservativeness                                |
|_______________________________|_________________________________________________|
|                               |                                                 |
| 1 to 7 days                   | Use the 95% lower or upper confidence limit of  |
|                               | the 72 hours prior to and after the missing     |
|                               | data period, whichever results in greater       |
|                               | conservativeness                                |
|_______________________________|_________________________________________________|
|                               |                                                 |
| More than 7 days              | No data may be replaced and no reduction may    | 
|                               | be credited                                     |
|_______________________________|_________________________________________________|                    

PROTOCOL 2

LANDFILL SITES – CH4 TREATMENT OR DESTRUCTION

Part I

(1) Projects covered

This offset credit protocol covers any project designed to reduce GHG emissions by treating or destroying the CH4 captured in a landfill site in Québec.

The project must involve the use of an eligible device to treat or destroy CH4 captured at a landfill site that meets the following conditions at the time of registration:

(1) on the date of application for registration and for the entire duration of the project, if the site is in operation, it receives less than 50,000 metric tonnes of residual materials annually and has a capacity of less than 1.5 million cubic metres;

(2) on the date of application for registration, in every case, the site has less than 450,000 metric tonnes of residual materials in place, or the CH4 captured from the LFG has a heat capacity of less than 3 GJ/h.

Eligible treatment or destruction devices are enclosed flares, open flares, combustion engines, boilers, turbines and CH4 liquefaction units.

The project must capture and treat or destroy CH4 that, before the project, was emitted to the atmosphere. The CH4 may be treated or destroyed on the landfill site or transported and treated or destroyed off-site.

For the purposes of this protocol,

(1) “landfill gas” (LFG) means any gas resulting from the decomposition of residual materials disposed of at a landfill site;

(2) “landfill site” means a place where residual materials is permanently disposed of above or below ground.

The provisions of subparagraph 1 of the second paragraph of this Division and those of Division 1.2 do not apply to a landfill site of a pulp and paper mill, a sawmill or an oriented strandboard manufacturing plant.

(1.1) (Revoked).

(1.2) Landfill site that is closed on the date of application for registration

In the case of a landfill site that is closed on the date of application for registration,

(1) (subparagraph revoked);

(2) if the site opened or was extended between 2006 and 2008 inclusively, it should have received less than 50,000 tonnes of residual materials annually and should have had a maximum capacity of less than 1,500,000 cubic metres; and

(3) if the site was in operation in 2009 or a subsequent year, the site should have received less than 50,000 metric tonnes of residual materials annually and should have had a maximum capacity of less than 1,500,000 cubic metres.

(2) Location

The project must be carried out within the borders of the province of Québec.

(3) Calculation of CH4 heat capacity captured from the landfill site

When a site has over 450,000 tonnes of residual materials in place, the promoter must assess the heat capacity of the CH4 captured, in gigajoules per hour, using the following method:

(1) by calculating the quantity of CH4 emitted each hour;

(2) by determining the quantity of CH4 captured each hour by multiplying the quantity of CH4 emitted each hour by 0.75;

(3) by determining the heat capacity by multiplying the quantity of CH4 captured each hour by the high heat value of the LFG of the portion of the CH4 set out in table 1.1 of QC.1.7 in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15).

The promoter must assess the quantity of CH4 emitted by the landfill site pursuant to Division 3 using the following method:

(1) by determining the quantity of CH4 generated using the Landgem software of the U.S. Environmental Protection Agency (USEPA), available at http://www.epa.gov/ttncatc1/products.html#software;

(2) by determining the quantity of residual materials disposed of annually using the data available since the opening of the landfill site;

(3) by using, for the parameters “k” and “Lo” of the software referred to in paragraph 1, the most recent parameters from the national inventory report on GHG emissions prepared by Environment Canada;

(4) by using a percentage of 50% as the percentage of CH4 in LFG;

(5) by using a value of 0.667 kg per cubic metre at standard conditions as the density of CH4.

(4) Additionnality

For the purposes of subparagraph b of paragraph 6 of section 70.3 of this Regulation, the project is considered to go beyond current practice when it meets the conditions in Divisions 1 to 3.

(5) Reduction project SSRs

The reduction project process flowchart in Figure 5.1 and the table in Figure 5.2 show all the SSRs that must be taken into account by the promoter when calculating the GHG emission reductions attributable to the project.

All the SSRs within the dotted line must be counted for the purposes of this protocol.

Figure 5.1. Flowchart for the reduction project process

Figure 5.2. Reduction project SSRs

 _________________________________________________________________________________
|      |                                           |     |             |          |
| SSR  | Description                               | GHG | Relevant to | Included |
| #    |                                           |     | project     |    or    |
|      |                                           |     | baseline    | Excluded |
|      |                                           |     | scenario (B)|          |
|      |                                           |     | and/or      |          |
|      |                                           |     | Project (P) |          |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 1    | Residual materials generation             | N/A |     B, P    | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 2    | Residual materials collection             | CO2 |     B, P    | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 3    | Residual materials placing activities     | CO2 |     B, P    | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 4    | Decomposition of residual materials in    | CO2 |     B, P    | Excluded |
|      | landfill                                  |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Included |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 5    | LFG capture system                        | CO2 |       P     | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 6    | Supplemental fuel                         | CO2 |       P     | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 7    | LFG boiler destruction                    | CO2 |       P     | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 8    | Electricity generation from LFG           | CO2 |       P     | Excluded |
|      | (combustion engine, turbine, fuel cell)   |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 9    | LFG flare destruction                     | CO2 |       P     | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 10   | LFG upgrading                             | CO2 |       P     | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 11   | Boiler following injection into a pipeline| CO2 |       P     | Excluded |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Excluded |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 12   | Avoided emissions from use of landfill    | CO2 |       P     | Excluded |
|      | gas project-generated thermal energy to   |     |             |          |
|      | replace energy from a fossil fuel         |     |             |          |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 13   | Avoided emissions from use of             | CO2 |       P     | Excluded |
|      | project-generated electricity to replace  |     |             |          |
|      | energy from a fossil fuel                 |     |             |          |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 14   | Avoided emissions from use                | CO2 |       P     | Excluded |
|      | of natural gas energy to                  |     |             |          |
|      | replace energy from a fossil fuel         |     |             |          |
|______|___________________________________________|_____|_____________|__________|
|      |                                           |     |             |          |
| 15   | Liquefaction of LFG and use               | CO2 |       P     | Excluded |
|      | as liquefied natural gas                  |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | CH4 |             | Included |
|      |                                           |_____|             |__________|
|      |                                           |     |             |          |
|      |                                           | N2O |             | Included |
|______|___________________________________________|_____|_____________|__________|
                    

(6) Calculation method for the GHG emission reductions attributable to the project

The promoter must calculate GHG emission reductions attributable to the project using equation 1:

Equation 1

ER = BE - PE

Where:

ER = GHG emission reductions attributable to the project during the project reporting period, in metric tonnes CO2 equivalent;

BE = Baseline scenario emissions during the project reporting period, calculated using equation 3, in metric tonnes CO2 equivalent;

PE = Project emissions during the project reporting period, calculated using equation 7, in metric tonnes CO2 equivalent.

When the flow meter does not correct for the temperature and pressure of the LFG at standard conditions, the promoter must measure LFG pressure and temperature separately and correct the flow values using equation 2. The promoter must use the corrected flow values in all the equations of this protocol.

Equation 2

293.13 P

LFGi,t = LFGuncorrected × ________ ×_________

T 101.325

Where:

LFGi,t = Corrected volume of LFG sent to treatment or destruction device i in time interval t, in cubic metres at standard conditions;

i = Treatment or destruction device;

t = Time interval shown in the table in Figure 7.1 for which CH4 flow and content measurements are aggregated;

LFGuncorrected = Uncorrected volume of LFG captured for the given time interval, in actual cubic metres;

T = Measured temperature of LFG for the given time period, in Kelvin (°C + 273.15);

P = Measured pressure of the LFG for the given time interval, in kilopascals.

(6.1) Calculation method for GHG emissions in the baseline scenario

The promoter must calculate GHG emissions in the baseline scenario using equations 3 to 6.

For that purpose, the promoter must

(1) for landfill sites with a geomembrane covering the entire landfill area, use a CH4 oxidation rate of zero (0%). In this case, the promoter must show in the first project report that the landfill site has a geomembrane that meets the requirements of the Regulation respecting the landfilling and incineration of residual materials(chapter Q-2, r. 19); and

(2) for all other landfill sites, use a CH4 oxidation factor of 10%.

Equation 3

BE = (CH4DESTPR) × 21 × (1 - OX) × (1 - DF)

Where:

BE = Baseline scenario emissions during the project reporting period, in metric tonnes CO2 equivalent;

CH4DestPR = Total quantity of CH4 treated or destroyed by all LFG treatment and destruction devices during the project reporting period, calculated using equation 4, in metric tonnes of CH4;

21 = Global Warming Potential factor of CH4;

OX = Factor for the oxidation of CH4 by soil bacteria, namely a factor of 0 for landfill sites with a geomembrane covering the entire landfill area, or a factor of 0.10 in other cases;

DF = Discount factor to account for uncertainties associated with the monitoring equipment for CH4 content in the LFG, namely a factor of 0 when the CH4 content in the LFG is measured continuously, and 0.1 in other cases, with measurements made at least weekly;

Equation 4

Where:

CH4DestPR = Total quantity of CH4 treated or destroyed by all LFG treatment or destruction devices during the project reporting period, in metric tonnes of CH4;

n = Number of treatment or destruction devices;

i = Treatment or destruction device;

CH4Desti = Net quantity of CH4 treated or destroyed by treatment or destruction device i during the project reporting period, calculated using equation 5, in cubic metres of CH4 at standard conditions;

0.667 = Density of CH4, in kilograms of CH4 per cubic metre of CH4 at standard conditions;

0.001= Conversion factor, kilograms to metric tonnes;

Equation 5

CH4Desti = Qi × DEi

Where:

CH4Desti = Net quantity of CH4 treated or destroyed by treatment or destruction device i during the project reporting period, in cubic metres of CH4 at standard conditions;

Qi = Total quantity de CH4 sent to treatment or destruction device i during the project reporting period, calculated using equation 6, in cubic metres of CH4 at standard conditions;

DEi = Default CH4 treatment or destruction efficiency of destruction device i, determined in accordance with Part II;

I = Treatment or destruction device;

Equation 6

Where:

Qi = Total quantity de CH4 sent to treatment or destruction device i during the project reporting period, in cubic metres of CH4 at standard conditions;

n = Number of time intervals during the project reporting period;

t = Time interval shown in the table in Figure 7.1 for which LFG CH4 flow and content measurements are aggregated;

LFGi,t = Corrected volume of LFG sent to treatment or destruction device i, in time interval t, in cubic metres at standard conditions;

PRCH4,t = Average CH4 fraction of the LFG in time interval t, in cubic metres of CH4 per cubic metre of LFG.

(6.2) Calculation method for GHG project emissions

The promoter must calculate the GHG project emissions using equations 7 to 10:

Equation 7

PE = FFCO2 + ELCO2 + NGemissions

Where:

PE = Project emissions during the project reporting period, in metric tonnes CO2 equivalent;

FFCO2 = Total CO2 emissions attributable to the use of fossil fuels during the project reporting period, calculated using equation 8, in metric tonnes CO2 equivalent;

ELCO2 = Total CO2 emissions attributable to the consumption of electricity during the project reporting period, calculated using equation 9, in metric tonnes CO2 equivalent;

NGemissions = Total quantity of CH4 and CO2 emissions attributable to supplemental natural gas during the project reporting period, calculated using equation 10, in metric tonnes CO2 equivalent;

Equation 8

Where:

FFCO2 = Total CO2 emissions attributable to the use of fossil fuels during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of types of fossil fuel;

j = Type of fossil fuel;

FFPR,j = Annual quantity of fossil fuel j consumed in the operation of equipment within the SSRs in the baseline scenario, expressed

— in kilograms, in the case of fuels whose quantity is expressed as a mass;

— in cubic metres at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in litres, in the case of fuels whose quantity is expressed as a volume of liquid;

EFCF,j = CO2 emission factor for fossil fuel j specified in Tables 1-3 to 1-8 of QC.1.7 in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), expressed

— in kilograms of CO2 per kilogram, in the case of fuels whose quantity is expressed as a mass;

— in kilograms of CO2 per cubic metre at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in kilograms of CO2 per litre, in the case of fuels whose quantity is expressed as a volume of liquid;

1,000 = Conversion factor, metric tonnes to kilograms;

Equation 9

ELPR × ELEL

ELCO2 = ___________

1,000

Where:

ELCO2 = Total CO2 emissions attributable to the consumption of electricity during the project reporting period, in metric tonnes CO2 equivalent;

ELPR = Total electricity consumed by the project LFG capture and treatment or destruction system during the project reporting period, in megawatt-hours;

EFEL = CO2 emission factor for the consumption of electricity from Québec, according to the most recent National Inventory Report: Greenhouse Gas Sources and Sinks in Canada, Part 3, published by Environment Canada, in kilograms of CO2 par megawatt-hour;

1,000 = Conversion factor, metric tonnes to kilograms;

Equation 10

Where:

NGemissions = Total CH4 and CO2 emissions attributable to supplemental natural gas during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of treatment or destruction devices;

i = Treatment or destruction device;

NGi = Total quantity of supplemental natural gas sent to treatment or destruction device i during the project reporting period, in cubic metres at standard conditions;

NGCH4 = Average CH4 fraction of the supplemental natural gas, according to the supplier’s specifications, in cubic metres of CH4 at standard conditions per cubic metre of natural gas at standard conditions;

0.667 = Density of CH4, in kilograms of CH4 per cubic metre of CH4 at standard conditions;

0.001= Conversion factor, kilograms to metric tonnes;

DEi = Default CH4 treatment or destruction efficiency of destruction device i, determined in accordance with Part II;

21 = Global Warming Potential factor of CH4;

12/16 = Molecular mass ratio, carbon to CH4;

44/12 = Molecular mass ratio, CO2 to carbon.

(7) Project surveillance

(7.1) Data collection

The promoter is responsible for collecting the information required for project monitoring.

The promoter must show that the data collected are actual and that rigorous supervision and record-keeping procedures are applied at the project site.

(7.2) Surveillance plan

The promoter must establish a monitoring plan to measure and monitor project parameters in accordance with 7.1:

Figure 7.1. Project surveillance plan

 _________________________________________________________________________________
|                |               |               |              |                 |
|Parameter       |Factor         |Unit of        |Method        |Frequency of     |
|                |used in        |measurement    |              |measurement      | 
|                |equations      |               |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Capacity and    |N/A            |Metric tonne   |Calculated    |Annual or at each|
|annual residual |               |               |              |project reporting|
|material        |               |               |              |period, in       |
|tonnage         |               |               |              |accordance with  |
|                |               |               |              |the second       |
|                |               |               |              |paragraph of     |
|                |               |               |              |section 1        |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Operating status|N/A            |Degree Celsius |Measured      |Hourly           |
|of destruction  |               |or other, in   |for each      |                 |
|devices         |               |accordance with|destruction   |                 |
|                |               |this Division  |device        |                 |
|                |               |7.2            |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Corrected       |LFGi,t         |Cubic metre at |Measured and  |Continuous and   |
|volume of LFG   |               |standard       |calculated    |recorded at least|
|sent to         |               |conditions     |              |every 15 minutes |
|destruction     |               |               |              |or totalized and |
|device i, in    |               |               |              |recorded at least|
|time interval t |               |               |              |daily and        |
|                |               |               |              |adjusted for     |
|                |               |               |              |temperature and  |
|                |               |               |              |pressure         |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Uncorrected     |LFGuncorrected |Cubic metre    |Measured      |Only when flow   |
|volume of LFG   |               |               |              |data are not     |
|captured for the|               |               |              |adjusted at      |
|given interval  |               |               |              |standard         |
|                |               |               |              |conditions       |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Discount factor |DF             |0 when the CH4 |              |At each project  |
|to account for  |               |content in the |              |reporting period |
|uncertainties   |               |LFG is         |              |                 |
|associated with |               |continuously   |              |                 |
|the monitoring  |               |monitored, or  |              |                 |
|equipment for   |               |0.1 in other   |              |                 |
|CH4 content in  |               |cases          |              |                 |
|the LFG         |                               |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Total quantity  |Qi             |Cubic metre of |Calculated    |Daily when the   |
|of CH4 sent to  |               |CH4 at standard|              |CH4 is           |
|destruction     |               |conditions     |              |continuously     |
|device i during |               |               |              |monitored, or    |
|the project     |               |               |              |weekly if the    |
|reporting period|               |               |              |CH4 is monitored |
|                |               |               |              |weekly           |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Time interval   |t              |Week, day,     |Projects with |Continuous, daily|
|for which LFG   |               |hour or minute |a continuous  |or weekly        |
|CH4 flow and    |               |               |CH4           |                 |
|content         |               |               |concentration |                 |
|measurements    |               |               |monitoring    |                 |
|are aggregated  |               |               |system may use|                 |
|                |               |               |the interval  |                 |
|                |               |               |used by their |                 |
|                |               |               |data          |                 |
|                |               |               |acquisition   |                 |
|                |               |               |system,       |                 |
|                |               |               |provided it is|                 |
|                |               |               |not more than |                 |
|                |               |               |1 day for the |                 |
|                |               |               |continuous    |                 |
|                |               |               |monitoring of |                 |
|                |               |               |CH4 content   |                 |
|                |               |               |and 1 week for|                 |
|                |               |               |the weekly    |                 |
|                |               |               |monitoring of |                 |
|                |               |               |CH4 content   |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Average CH4     |PRCH4,t        |Cubic metre of |Measured      |Continuous or    |
|fraction of the |               |CH4 at standard|continuously  |weekly           |
|LFG in time     |               |conditions per |or by portable|                 |
|interval t      |               |cubic metre of |analyzer      |                 |
|                |               |LFG at standard|              |                 |
|                |               |conditions     |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Total fossil    |FFPR,j         |Kilogram       |Calculated    |At each project  |
|fuels consumed  |               |(solid)        |using fossil  |reporting period |
|by the capture  |               |               |fuel          |                 |
|and destruction |               |Cubic metre at |purchasing    |                 |
|system during   |               |standard       |register      |                 |
|the project     |               |conditions     |              |                 |
|reporting       |               |(gas)          |              |                 |
|period, by type |               |               |              |                 |
|of fuel j       |               |Litre (liquid) |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Total electricty|ELPR           |Megawatt-hour  |Measured by   |At each project  |
|consumed by the |               |               |onsite meter  |reporting period |
|LFG capture and |               |               |or based on   |                 |
|destruction     |               |               |electricity   |                 |
|system during   |               |               |purchasing    |                 |
|the project     |               |               |register      |                 |
|reporting period|               |               |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Total quantity  |NGi            |Cubic metre at |Measured      |Continuous       |
|of              |               |standard       |before being  |                 |
|supplemental    |               |conditions     |sent to the   |                 |
|natural gas sent|               |               |destruction   |                 |
|to the          |               |               |device        |                 |
|destruction     |               |               |              |                 |
|device during   |               |               |              |                 |
|the project     |               |               |              |                 |
|reporting       |               |               |              |                 |
|period          |               |               |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|Average CH4     |NGCH4          |Cubic metre of |Based on      |At each project  |
|fraction of the |               |CH4 at standard|purchasing    |reporting period |
|supplemental    |               |conditions per |register      |                 |
|natural gas,    |               |cubic metre of |              |                 |
|according to the|               |natural gas at |              |                 |
|supplier’s      |               |standard       |              |                 |
|specifications  |               |conditions     |              |                 |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|LFG temperature |T              |°C             |Measured      |Continuous       |
|________________|_______________|_______________|______________|_________________|
|                |               |               |              |                 |
|LFG pressure    |P              |kPa            |Measured      |Continuous       |
|________________|_______________|_______________|______________|_________________|                    

The surveillance plan must

(1) specify the methods used to collect and record the data required for all the relevant parameters in the table in Figure 7.1;

(2) specify

(a) the frequency of data acquisition;

(b) the frequency of instrument cleaning, inspection and calibration activities, and of the verification of instrument calibration accuracy; and

(c) the role of the person responsible for each monitoring activity, as well as the quality assurance and quality control measures taken to ensure that data acquisition and instrument calibration are carried out consistently and with precision; and

(3) contain a detailed diagram of the LFG capture and treatment or destruction system, including the placement of all measurement instrument and equipment that affect included SSRs.

The promoter is responsible for carrying out and monitoring project performance. The promoter must use the LFG treatment or destruction device and the measurement instruments in accordance with the manufacturer’s specifications. The promoter must, in particular, use measurement instruments to measure directly

(1) the flow of LFG before being delivered to the treatment or destruction device, continuously, recorded every 15 minutes or totalized and recorded at least daily, adjusted for temperature and pressure; and

(2) the CH4 content of the LFG sent to each treatment or destruction device, continuously, recorded every 15 minutes and totalized as an average at least daily. The CH4 content may also be determined by daily to weekly measurements using a calibrated portable analyzer and applying a 10% discount to the total quantity of CH4 captured and eliminated, calculated using equation 4.

Despite the third paragraph, in the case of projects carried out between 1 January 2007 and 31 December 2012, during that period the flow of LFG referred to in subparagraph 1 this paragraph may have been recorded every 60 minutes and the CH4 content of the LFG referred o in subparagraph 2 of this paragraph may have been recorded every 60 minutes.

When temperature and pressure must be measured to correct flow values at standard conditions, the parameters must be measured continuously.

The operating status of the LFG treatment or destruction device must be monitored and recorded at least hourly.

The operating status of flares is established by thermocouple readings above 260 °C.

For all other treatment or destruction devices, the promoter must show in the project plan that a monitoring device has been installed to verify the operation of the treatment or destruction device. The promoter must also show in each project report that the monitoring device has operated correctly.

GHG emission reductions will not be taken into account for the issue of offset credits for periods during which the treatment or destruction device or the monitoring device for the operation of the treatment or destruction device is not operating.

(7.3) Measurement instruments

The promoter must ensure that all LFG flow meters and CH4 analyzers are

(1) cleaned and inspected as specified in the project’s monitoring plan and at the minimum cleaning and inspection frequency specified by the manufacturer, with all cleaning and inspection activities documented by landfill site personnel;

(2) not more than 2 months before or after the project reporting period end date, either

(a) checked for calibration accuracy by a qualified and independent person, using a portable instrument, such as a pito tube, or manufacturer’s specifications, and ensure that the percentage drift is recorded; or

(b) calibrated by the manufacturer, or by a third person certified for that purpose by the manufacturer; and

(3) calibrated by the manufacturer, or by a third person certified for that purpose by the manufacturer, according to the manufacturer’s specifications or every 5 years, whichever is more frequent.

A calibration certificate or a verification report on calibration accuracy must be produced and included in the project report. The verification provided for in section 70.16 of this Regulation must include confirmation that the person is qualified to verify calibration accuracy.

Flow meter calibrations must be documented to show that the meter was calibrated to a range of flow rates corresponding to the flow rates expected at the landfill site.

CH4 analyzer calibrations must be documented to show that the calibration was carried out to a range of temperature and pressure conditions corresponding to the range of conditions measured at the landfill site.

The verification of flow meter and analyzer calibration accuracy must show that the instrument provides a reading of volumetric flow or CH4 content that is within a +/-5% accuracy threshold.

When a verification of the calibration accuracy of a device shows a shift outside the +/- 5% accuracy threshold, the device must be calibrated by the manufacturer or by a third person certified for that purpose by the manufacturer. In addition, for the entire period from the last calibration that confirmed accuracy within the ± 5% threshold until such time as the piece of equipment is correctly calibrated, all the data from the piece of equipment must be corrected according to the following procedure:

(1) when the calibration indicates an under-reporting of flow rates or CH4 content, the promoter must use the measured values without correction;

(2) when the calibration indicates an over-reporting of flow rates or CH4 content, the promoter must apply to the measured values the greatest calibration drift recorded at the time of calibration.

The last calibration confirming accuracy within the ± 5% threshold must not have taken place more than 2 months before the end date for the project reporting period.

If the promoter uses a portable CH4 analyzer, it must be maintained and calibrated according to the manufacturer’s specifications, and calibrated at least annually by the manufacturer, by a laboratory certified by the manufacturer, or by an ISO 17025 accredited laboratory. The portable analyzer also must be calibrated to a known sample gas prior to each use.

No offset credit may be issued for a project reporting period when the calibration or verification of the calibration accuracy of the required instruments has not been correctly carried out and documented.

(7.4) Data management

Information on data procedures and data monitoring must be managed in a way that guarantees the integrity, exhaustiveness, accuracy and validity of the data.

The promoter must keep the following documents and information:

(1) the information required under the monitoring plan;

(2) information on each flow meter, CH4 analyzer and destruction device used, including type, model number, serial number and manufacturer’s maintenance and calibration procedures;

(3) for a portable analyzer, the date, time and place where measurements are taken and, for each measurement, the CH4 content in the LFG;

(4) the calibration date, time and results for CH4 analyzers and flow meters, and the corrective measures applied if a piece of equipment fails to meet the requirements of this Regulation;

(5) the maintenance records for capture, destruction and monitoring systems;

(6) operating records showing the quantity of residual material disposed of.

(7.5) Missing data – replacement methods

In situations where data on flow rates or CH4 content are missing, the promoter must apply the data replacement methods set out in Part III.

Part II

Destruction efficiencies for destruction devices

The promoter must use the destruction efficiency shown in Table 1 for the project destruction device.

Table 1. Default destruction efficiencies for destruction devices

 _________________________________________________________________________________
|                                        |                                        |
| Treatment or destruction device        | Efficiency                             |
|________________________________________|________________________________________|
|                                        |                                        |
| Open flare                             | 0.96                                   |
|________________________________________|________________________________________|
|                                        |                                        |
| Enclosed flare                         | 0.995                                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Internal combustion engine             | 0.936                                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Boiler                                 | 0.98                                   |
|________________________________________|________________________________________|
|                                        |                                        |
| Microturbine or large gas turbine      | 0.995                                  |
|________________________________________|________________________________________|
|                                        |                                        |
| Boiler following upgrade and injection | 0.96                                   |
| into a pipeline                        |                                        |
|________________________________________|________________________________________|
|                                        |                                        |
| CH4 liquefaction unit                  | 0.95                                   |
|________________________________________|________________________________________|                    

Part III

Missing data – replacement methods

The replacement methods below may be used only

(1) for CH4 content or LFG flow rate parameters;

(2) for missing data on gas flow rates that are discrete, non-chronic and due to unforeseen circumstances;

(3) when the proper functioning of the treatment or destruction device can be shown by thermocouple readings at the flare or other device;

(4) when data on LFG flow rate only, or CH4 content only, are missing;

(5) to replace data on LFG flow rates when a continuous analyzer is used to measure CH4 content and when it is shown that CH4 content was consistent with normal operations for the time when the data are missing; and

(6) to replace data on CH4 content when it is shown that the LFG flow rate was consistent with normal operations for the time when the data are missing.

No offset credit may be issued for periods when the replacement methods cannot be used.

 _________________________________________________________________________________
|                            |                                                    |
| Missing data period        | Replacement method                                 | 
|____________________________|____________________________________________________|
|                            |                                                    |
| Less than 6 hours          | Use the average of the 4 hours immediately before  |
|                            | and following the missing data period              |
|____________________________|____________________________________________________|
|                            |                                                    |
| 6 to less than 24 hours    | Use the 90% upper or lower confidence limit of the |
|                            | 24 hours prior to and after the missing data       |
|                            | period, whichever results in greater               |
|                            | conservativeness                                   |
|____________________________|____________________________________________________|
|                            |                                                    |
| 1 to 7 days                | Use the 95% upper or lower confidence limit of the |
|                            | 72 hours prior to and after the missing data       |
|                            | period, whichever results in greater               |
|                            | conservativeness                                   |
|____________________________|____________________________________________________|
|                            |                                                    |
| More than 7 days           | No data may be replaced and no reduction may be    |
|                            | credited                                           |
|____________________________|____________________________________________________|
                      

PROTOCOL 3

DESTRUCTION OF OZONE DEPLETING SUBSTANCES CONTAINED IN INSULATING FOAM OR USED AS REFRIGERANTS REMOVED FROM REFRIGERATION, FREEZER AND AIR-CONDITIONING APPLIANCES

Part I

For the purposes of this protocol,

(1) “container” means an air-tight, waterproof unit used for storing or transporting ODS without leakage or escape of ODS into the environment;

(2) “CFC”: chlorofluorocarbons;

(3) “HCFC”: hydrochlorofluorocarbons;

(3.1) “foam”: insulating foam removed from refrigeration or freezer appliances;

(4) “ODS contained in foam”: ozone depleting substances of the following types:

(a) CFC-11;

(b) CFC-12;

(c) HCFC-22;

(d) HCFC-141b;

(5) “ODS used as refrigerants”: ozone depleting substances of the following types:

(a) CFC-11;

(b) CFC-12;

(c) CFC-13;

(d) CFC-113;

(e) CFC-114;

(f) CFC-115;

(6) “ODS”: ODS contained in foam and ODS used as refrigerants;

(7) “substitute refrigerants”: refrigerants used to replace refrigerants destroyed by a project.

For the purposes of this protocol, chlorofluorocarbons (CFC) and hydrochlorofluorocarbons (HCFC) are greenhouse gases.

(1) Projects covered

(1.1) Eligible ODS

This offset credit protocol covers projects for all activities associated with the destruction of ODS contained in foam or used as refrigerants removed from refrigeration, freezer or air-conditioning appliances recovered in Canada.

Ozone depleting substances contained in foam removed from refrigeration or freezer appliances and ODS used as refrigerants removed from equipment, systems or appliances from industrial, commercial, institutional or residential sources or removed from ODS stored by such sources for their future use or their disposal, and used for refrigeration, freezing and air conditioning are admissible for the purposes of this protocol.

When ODS used as refrigerants targeted by a project are removed from refrigeration, freezer or air-conditioning appliances that also contain ODS contained in foam, the project must also, for any destruction activity taking place after 22 October 2016, provide for the extraction and destruction of the ODS contained in the foam in accordance with this protocol.

(1.2) Duration

A project may cover a maximum period of 5 years provided that, during each year following registration,

(1) the extraction and destruction locations and methods are the same;

(2) the types of appliances from which ODS are extracted are the same; and

(3) the project is continuous over the entire period, in other words at least one destruction occurs each year and a project report is submitted.

In other cases, the ODS must be destroyed within 12 months from the project start date. A new project registration application must be made for any ODS destruction activity occurring after that period.

(2) First project report

In addition to the information required under second paragraph of section 70.5 of this Regulation, the first project report must include the following information:

(1) the name and contact information of the facility removing foam or refrigerants or extracting ODS, of the destruction facility and, where applicable, of the enterprise that carries out such activities;

(2) the name and contact information of any technical consultants;

(3) a list of all the points of origin of each type of ODS destroyed under the project, namely the first place where the appliances with ODS are stored, by Canadian province or territory;

(4) a description of the methods used to remove foam or refrigerants from the appliances, extract ODS from the foam and destroy the ODS;

(5) an estimate of the quantity of foam and ODS recovered, by type of ODS and according to whether the ODS are contained in the foam or are used as refrigerants, in metric tonnes.

(3) Location

The ODS contained in the foam must be destroyed in a facility located in Canada or the United States. However, removal of the foam and refrigerants from the appliances and extraction of the ODS from the foam must be carried out in Canada. Foam, ODS and appliances recovered outside Canada are not eligible for the issue of offset credits under this protocol.

(4) Additionnality

For the purposes of subparagraph b of paragraph 6 of section 70.3 of this Regulation, the project is considered to go beyond current practice if it meets the conditions in Divisions 1 to 3 of this protocol.

(5) Extraction and destruction

ODS must be extracted and destroyed as follows:

(1) ODS contained in foam must be extracted in concentrated form using a negative pressure process;

(2) all ODS must be collected, stored and transported in hermetically sealed containers;

(3) all ODS must be destroyed in concentrated form in an ODS destruction facility meeting the requirements in Division 10 of this protocol

(6) SSRs within the reduction project boundary

Figures 6.1 to 6.3 show the SSRs that must be taken into account by the promoter when calculating the GHG emission reductions attributable to the project.

All the SSRs within the dotted line must be counted for the purposes of this protocol.

Figure 6.1. Flowchart for the reduction project process for the ODS contained in the foam

Figure 6.1.1. Chart showing the reduction project process for ODS used as refrigerants

Figure 6.2. Reduction project SSRs targeted in the calculation of GHG emissions under the baseline scenario and project scenario for ODS contained in foam

 _________________________________________________________________________________ 
|                  |                               |        |            |        |
|SSR #             |Description                    |Type of |Relevant to |Included|
|                  |                               |emission|project     |   or   |
|                  |                               |        |baseline    |Excluded|
|                  |                               |        |scenario (B)|        |
|                  |                               |        |and/or      |        |
|                  |                               |        |Project (P) |        |
|__________________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
| 1 |Appliance     |Fossil fuel emissions          |  CO2   |    B, P    |Excluded|
|   |collection    |attributable to the collection |________|____________|________|
|   |              |and transportation of end-of-  |        |            |        |
|   |              |life appliances                |  CH4   |    B, P    |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N20   |    B, P    |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
| 2 |Appliance     |Emissions of ODS attributable  |  ODS   |    B       |Included|
|   |shredding     |to the shredding of appliances |        |            |        |
|   |              |for materials recovery         |        |            |        |
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
| 3 |ODS Extraction|Emissions of ODS attributable  |  ODS   |    P       |Included|
|   |              |to the removal of foam from    |        |            |        |
|   |              |appliances                     |        |            |        |
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions of ODS attributable  |  ODS   |    B       |Included|
|   |              |to the disposal of foam at a   |        |            |        |
|   |              |landfill site                  |        |            |        |
|   |              |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions of ODS degradation   |  HFC,  |    B       |Excluded|
|   |              |products attributable to foam  |  HCFC  |            |        |
| 4 |Disposal of   |disposed of at a landfill site |        |            |        |
|   |foam in       |_______________________________|________|____________|________|
|   |landfill      |                               |        |            |        |
|   |              |Fossil fuel emissions          |  CO2   |    B       |Excluded|
|   |              |attributable to the            |________|____________|________|
|   |              |transportation of shredded     |        |            |        |
|   |              |foam and disposal at a landfill|  CH4   |    B       |Excluded|
|   |              |site                           |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    B       |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
| 5 |Transportation|Emissions of fossil fuels      |  CO2   |    P       |Included|
|   |to the        |fossil attributable to the     |        |            |        |
|   |destruction   |transportation of ODS from the |        |            |        |
|   |facility      |point of origin to the         |        |            |        |
|   |              |destruction facility           |        |            |        |
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions of ODS attributable  |  ODS   |    P       |Included|
|   |              |to incomplete destruction at   |        |            |        |
|   |              |destruction facility           |        |            |        |
|   |              |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions from the oxidation   |  CO2   |    P       |Included|
|   |              |of carbon contained in the     |        |            |        |
| 6 |Destruction   |destroyed ODS                  |        |            |        |
|   |of ODS        |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Fossil fuel emissions          |  CO2   |    P       |Included|
|   |              |attributable to the            |________|____________|________|
|   |              |destruction of ODS in a        |        |            |        |
|   |              |destruction facility           |  CH4   |    P       |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    P       |Excluded|
|   |              |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Indirect emissions attributable|  CO2   |    P       |Included|
|   |              |to the use of electricity      |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  CH4   |    P       |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    P       |Excluded|
|___|______________|_______________________________|________|____________|________|                    

Figure 6.3. SSRs targeted in the calculation of GHG emissions under the baseline scenario and project scenario for ODS used as refrigerants

 _________________________________________________________________________________ 
|                  |                               |        |            |        |
|SSR #             |Description                    |Type of |Relevant to |Included|
|                  |                               |emission|project     |   or   |
|                  |                               |        |baseline    |Excluded|
|                  |                               |        |scenario (B)|        |
|                  |                               |        |and/or      |        |
|                  |                               |        |Project (P) |        |
|__________________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
| 1 |Appliance     |Fossil fuel emissions          |  CO2   |    B, P    |Excluded|
|   |collection    |attributable to the collection |________|____________|________|
|   |              |and transportation of end-of-  |        |            |        |
|   |              |life appliances                |  CH4   |    B, P    |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N20   |    B, P    |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions of ODS attributable  |  ODS   |    B, P    |Excluded|
|   |              |to the extraction and          |        |            |        |
|   |              |collection of refrigerants     |        |            |        |
|   |              |from end-of-life equipment or  |        |            |        |
|   |              |equipment undergoing           |        |            |        |
|   |              |maintenance                    |        |            |        |
| 2 |ODS extraction|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Fossil fuel emissions          |  CO2   |    B, P    |Excluded|
|   |              |attributable to the            |________|____________|________|
|   |              |extraction and collection of   |        |            |        |
|   |              |refrigerants from end-of-life  |  CH4   |    B, P    |Excluded|
|   |              |equipment or equipment         |________|____________|________|
|   |              |undergoing maintenance         |        |            |        |
|   |              |                               |  N2O   |    B, P    |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |ODS emissions attributable to  |  ODS   |    B, P    |Excluded|
|   |              |equipment leakage and          |        |            |        |
|   |              |maintenance                    |        |            |        |
| 3 |Industrial    |_______________________________|________|____________|________|
|   |and           |                               |        |            |        |
|   |commercial    |Fossil fuel emissions          |  CO2   |    B, P    |Excluded|
|   |refrigeration |attributable to the operation  |________|____________|________|
|   |              |of refigeration and air -      |        |            |        |
|   |              |conditioning equipment         |  CH4   |    B, P    |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    B, P    |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Substitute refrigerant         |  CO2e  |    P       |Excluded|
|   |              |emissions during production    |        |            |        |
| 4 |Production of |_______________________________|________|____________|________|
|   |substitute    |                               |        |            |        |
|   |refrigerant   |Fossil fuel emissions          |  CO2   |    P       |Excluded|
|   |              |during the production of       |________|____________|________|
|   |              |substitute refrigerants        |        |            |        |
|   |              |                               |  CH4   |    P       |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    P       |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
| 5 |Transportation|Fossil fuel emissions          |  CO2   |    P       |Included|
|   |to the        |attributable to the            |________|____________|________|
|   |destruction   |transportation of ODS from the |        |            |        |
|   |facility      |point of origin to the         |  CH4   |    P       |Excluded|
|   |              |destruction facility           |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    P       |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions of ODS attributable  |  ODS   |    B       |Included|
|   |              |to leakage and maintenance     |        |            |        |
|   |              |during the continuous operation|        |            |        |
|   |              |of equipment                   |        |            |        |
|   |              |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Substitute refrigerant         |  CO2e  |    P       |Included|
|   |              |emissions attributable to      |        |            |        |
|   |              |leakage and maintenance during |        |            |        |
|   |              |the continous operation of     |        |            |        |
|   |              |equipment                      |        |            |        |
| 6 |Refrigeration |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Indirect emissions             |  CO2   |    B, P    |Excluded|
|   |              |attributable to the use of     |________|____________|________|
|   |              |electricity                    |        |            |        |
|   |              |                               |  CH4   |    B, P    |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    B, P    |Excluded|
|___|______________|_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions of ODS attributable  |  ODS   |    P       |Included|
|   |              |to incomplete destruction at   |        |            |        |
|   |              |the destruction facility       |        |            |        |
|   |              |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Emissions from the oxidation   |  CO2   |    P       |Included|
|   |              |of carbon contained in the     |        |            |        |
|   |              |destroyed ODS                  |        |            |        |
| 7 |Destruction   |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Fossil fuel emissions          |  CO2   |    P       |Included|
|   |              |attributable to the destruction|________|____________|________|
|   |              |of ODS in a destruction        |        |            |        |
|   |              |facility                       |  CH4   |    P       |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    P       |Excluded|
|   |              |_______________________________|________|____________|________|
|   |              |                               |        |            |        |
|   |              |Indirect emissions             |  CO2   |    P       |Included|
|   |              |attributable to the use of     |________|____________|________|
|   |              |electricity                    |        |            |        |
|   |              |                               |  CH4   |    P       |Excluded|
|   |              |                               |________|____________|________|
|   |              |                               |        |            |        |
|   |              |                               |  N2O   |    P       |Excluded|
|___|______________|_______________________________|________|____________|________|            

(7) Calculation method for total GHG emission reductions attributable to a project

In calculating the GHG emission reductions attributable to a project for the destruction of ODS, the promoter must calculate the reductions attributable to the destruction of ODS contained in foam separately from those attributable to the destruction of ODS used as refrigerants.

The promoter must calculate the total GHG emission reductions using equation 1:

Equation 1

ERT = ERF + ERR

Where:

ERT = Total GHG emission reductions attributable to the project during the project reporting period, in metric tonnes CO2 equivalent;

ERF = Total GHG emission reductions attributable to the destruction of ODS contained in foam during the project reporting period, calculated using equation 2, in metric tonnes CO2 equivalent;

ERR = Total GHG emission reductions attributable to the destruction of ODS used as refrigerants during the project reporting period, calculated using equation 6.2, in metric tonnes CO2 equivalent.

For the purposes of the equations, the promoter must use the global warming potential of ODS shown in Figure 7.1:

Figure 7.1. Global warming potential of ODS

 _________________________________________________________________________________ 
|                              |                                                  |
| Type of ODS                  | Global warming potential (metric tonnes CO2      |
|                              | equivalent per metric tonne of ODS)              |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-11                       | 4,750                                            |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-12                       | 10,900                                           |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-13                       | 14,400                                           |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-113                      | 6,130                                            |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-114                      | 10,000                                           |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-115                      | 7,370                                            |
|______________________________|__________________________________________________|
|                              |                                                  |
| HCFC-22                      | 1,810                                            |
|______________________________|__________________________________________________|
|                              |                                                  |
| HCFC-141b                    | 725                                              |
|______________________________|__________________________________________________|
                     

(7.1) Calculation method for GHG emission reductions under a project for the destruction of ODS contained in foam

The promoter must calculate GHG emission reductions under a project for the destruction of ODS contained in foam using equation 2:

Equation 2

ERF = BEF - PEF

Where:

ERF = Total GHG emission reductions attributable to the project for the destruction of ODS contained in foam during the project reporting period, in metric tonnes CO2 equivalent;

BEF = Baseline emissions attributable to the destruction of ODS contained in foam during the project reporting period, calculated using equation 3, in metric tonnes CO2 equivalent;

PEF = GHG emissions under the project for the destruction of ODS contained in foam during the project reporting period, calculated using equation 5, in metric tonnes CO2 equivalent.

(7.1.1) Calculation of GHG emissions under the baseline scenario under a project for the destruction of ODS contained in foam

The promoter must calculate GHG emissions under the baseline scenario attributable to ODS-containing foam using equations 3 and 4:

Equation 3

Where:

BEF = Baseline emissions attributable to the destruction of ODS contained in foam during the project reporting period, in metric tonnes CO2 equivalent;

i = Type of ODS;

n = Number of types of ODS;

BAinit, i = Initial quantity of ODS of type i contained in foam prior to removal from appliances, calculated using equation 4, in metric tonnes of ODS of type i;

EFF,i = GHG emission factor for ODS of type i contained in foam, as indicated in the table in Figure 7.2;

GWPi = Global warming potential of ODS of type i as indicated in the table in Figure 7.1, in metric tonnes CO2 equivalent per metric tonne of ODS of type i;

Equation 4

Where:

BAinit, i = Initial quantity of ODS of type i contained in foam prior to removal from appliances, in metric tonnes of ODS of type i;

BAfinal, i = Total quantity of ODS of type i extracted and sent for destruction, determined in accordance with Division 9, in metric tonnes of ODS of type i;

EE = Extraction efficiency of the ODS extraction process, calculated in accordance with the method in Part II;

i = Type of ODS.

Figure 7.2. Emission factor for each type of ODS contained in foam removed from appliances

 _________________________________________________________________________________ 
|                              |                                                  |
| Type of ODS                  | Emission factor for each type of ODS contained   |
|                              | in foam removed from appliances (EFF,i)           |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-11                       | 0.44                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-12                       | 0.55                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| HCFC-22                      | 0.75                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| HCFC-141b                    | 0.50                                             |
|______________________________|__________________________________________________|
                     

(7.1.2) Calculation of GHG emissions under a project for the destruction of ODS contained in foam

The promoter must calculate GHG emissions under a project for the destruction of ODS contained in foam using equations 5 to 6.1.

Equation 5

PEF = BApr + (Tr + DEST)F

Where:

PEF = GHG emissions under a project for the destruction of ODS contained in foam during the project reporting period, in metric tonnes CO2 equivalent;

BApr = Total quantity of ODS contained in foam that are emitted during extraction, calculated using equation 6, in metric tonnes CO2 equivalent;

(Tr + DEST)F = GHG emissions attributable to the transportation and destruction of ODS contained in foam, calculated using equation 6.1, in metric tonnes CO2 equivalent;

Equation 6

Where:

BApr = Total emissions attributable to the extraction of ODS contained in foam removed from appliances, in metric tonnes CO2 equivalent;

i = Type of ODS;

n = Number of types of ODS;

BAinit,i = Total quantity of ODS of type i contained in foam removed from appliances prior to extraction, calculated using equation 4, in metric tonnes of ODS of type i;

EEF = Extraction efficiency of the extraction process for ODS contained in foam, determined for the project using the method in Part II;

GWPi = Global warming potential of ODS of type i as indicated in the table in Figure 7.1, in metric tonnes CO2 equivalent per metric tonne of ODS of type i;

Equation 6.1

(Tr + DEST)F = BAfinal × 7.5

Where:

(Tr + DEST)F = GHG emissions attributable to the transportation and destruction of ODS contained in foam, in metric tonnes CO2 equivalent;

BAfinal = Total quantity of ODS contained in foam sent for destruction under the project, calculated using equation 10, in metric tonnes of ODS;

7.5 = Default emission factor for ODS transportation and destruction, in metric tonnes CO2 equivalent per metric tonne of ODS.

(7.2) Calculation method for total GHG emission reductions under a project for the destruction of ODS used as refrigerants

The promoter must calculate GHG emission reductions under a project for the destruction of ODS used as refrigerants using equation 6.2:

Equation 6.2

ERR = BER - PER

Where:

ERR = Total GHG emission reductions attributable to the project for the destruction of ODS used as refrigerants during the project reporting period, in metric tonnes CO2 equivalent;

BER = Baseline emissions attributable to the destruction of ODS used as refrigerants during the project reporting period, calculated using equation 6.3, in metric tonnes CO2 equivalent;

PER =GHG emissions under the project for the destruction of ODS used as refrigerants during the project reporting period, calculated using equation 6.4, in metric tonnes CO2 equivalent.

(7.2.1) Calculation of GHG emissions under the baseline scenario under a project for the destruction of ODS used as refrigerants

The promoter must calculate GHG emissions under the baseline scenario under a project for the destruction of ODS used as refrigerants using equation 6.3:

Equation 6.3

Where:

BER = Emissions under the baseline scenario attributable to the destruction of ODS used as refrigerants during the project reporting period, in metric tonnes CO2 equivalent;

i = Type of ODS;

n = Number of types of ODS;

Qi = Total quantity of ODS of type i used as refrigerants recovered and sent for destruction, determined in accordance with Division 9, in metric tonnes of ODS of type i;

EFR,i = GHG emission factor for ODS of type i used as refrigerants, as indicated in the table in Figure 7.3;

GWPi = Global warming potential of ODS of type i as indicated in the table in Figure 7.1, in metric tonnes CO2 equivalent per metric tonne of ODS of type i;

Figure 7.3. Emission factor for each type of ODS used as a refrigerant

 _________________________________________________________________________________ 
|                              |                                                  |
| Type of ODS                  | Emission factor for each type of ODS used as a   |
|                              | refrigerant (EFR,i)                               |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-11                       | 0.89                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-12                       | 0.95                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-13                       | 0.61                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-113                      | 0.89                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-114                      | 0.78                                             |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-115                      | 0.61                                             |
|______________________________|__________________________________________________|
                     

(7.2.2) Calculation of GHG emissions under a project for the destruction of ODS used as refrigerants

The promoter must calculate total GHG emissions under a project for the destruction of ODS used as refrigerants using equations 6.4 to 6.7:

Equation 6.4

PER = Sub + (Tr + Dest)R

Where:

PER = GHG emissions under the project for the destruction of ODS used as refrigerants during the project reporting period, in metric tonnes CO2 equivalent;

Sub = Total GHG emissions attributable to substitute refrigerants, calculated using equation 6.5, in metric tonnes CO2 equivalent;

(Tr + DEST)R = GHG emissions attributable to the transportation and destruction of ODS used as refrigerants, calculated using equation 6.6, in metric tonnes CO2 equivalent;

Equation 6.5

Where:

Sub = Total GHG emissions attributable to substitute refrigerants, in metric tonnes CO2 equivalent;

i = Type of ODS;

n = Number of types of ODS;

Qi = Total quantity of ODS of type i used as refrigerants recovered and sent for destruction, determined in accordance with Division 9, in metric tonnes of ODS of type i;

EFSi = Emission factor for substitutes for ODS of type i as indicated in the table in Figure 7.4, in metric tonnes CO2 equivalent per metric tonne of ODS;

Figure 7.4. Emission factors for substitute refrigerants

 _________________________________________________________________________________ 
|                              |                                                  |
| ODS used as refrigerants     | Emission factors for substitute                  |
|                              | refrigerants (EFSi)                              |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-11                       | 223                                              |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-12                       | 686                                              |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-13                       | 7,144                                            |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-113                      | 220                                              |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-114                      | 659                                              |
|______________________________|__________________________________________________|
|                              |                                                  |
| CFC-115                      | 1,139                                            |
|______________________________|__________________________________________________|

                     

Equation 6.6

(TR + Dest)R = Q × 7.5

Where:

(Tr + DEST)R = GHG emissions attributable to the transportation and destruction of ODS used as refrigerants, in metric tonnes CO2 equivalent;

Q = Total quantity of ODS used as refrigerants recovered and sent for destruction, calculated using equation 6.7, in metric tonnes of ODS;

7.5 = Default emission factor for ODS transportation and destruction, in metric tonnes CO2 equivalent per metric tonne of ODS;

Equation 6.7

Where:

Q = Total quantity of ODS used as refrigerants recovered and sent for destruction, in metric tonnes of ODS;

i = Type of ODS;

n = Number of types of ODS;

Qi = Total quantity of ODS of type i used as refrigerants recovered and sent for destruction, determined in accordance with Division 9, in metric tonnes of ODS of type i.

(8) Data management and project surveillance

(8.1) Data management

The promoter must record the following information in the register referred to in section 70.13, and include it in the project report referred to in the second paragraph of section 70.14, indicating separately the information pertaining to ODS contained in foam and that pertaining to ODS used as refrigerants:

(1) information on the chain of traceability, from point of origin to point of destruction of the ODS;

(2) information on the point of origin, namely the first place of storage for recovered appliances with ODS-containing foam, specifying

(a) the address of each place of storage where recovered appliances are transferred or aggregated;

(b) the name and contact information of each party involved in each stage of the project, and the quantity of materials, whether appliances, foam or ODS, transferred, sold or handled by each party; and

(c) the number of appliances recovered and, for each appliance, the type, size, storage capacity and, if available, serial number;

(3) the serial number or identification number of the containers used for ODS storage and transportation;

(4) any document identifying persons in possession of appliances, foam and ODS at each stage in the project, and showing the transfer of possession and ownership of the appliances, foam and ODS;

(5) information on ODS extraction, specifying

(a) the number of appliances containing foam from which ODS has been extracted;

(a.1) the number of appliances containing refrigerants from which ODS have been extracted;

(b) the name and contact information of the facility where the ODS are extracted;

(c) the name and contact information of the facility where the appliances are recycled, if any; and

(d) processes, training, and quality assurance, quality control and extraction process management processes;

(6) a certificate of destruction for all the ODS destroyed under the project, issued by the facility that destroyed the ODS, by destruction activity, specifying

(a) the name of the project promoter;

(b) the name and contact information of the destruction facilities;

(c) the name and signature of the person responsible for the destruction operations;

(d) the identification number on the certificate of destruction;

(e) the serial, tracking or identification number of all containers for which ODS destruction occurred;

(f) the weight and type of ODS destroyed for each container, including the weigh tickets generated in accordance with Division 9.1;

(g) the destruction start date and time; and

(h) the destruction end date and time;

(7) the surveillance plan referred to in Division 8.2;

(8) the certificate of sampling results issued by the laboratory in accordance with Division 9.1.

All the data referred to in subparagraph 2 of the first paragraph concerning the point of origin must be obtained at the time of recovery from the point of origin.

(8.2) Surveillance plan

The promoter must establish a surveillance plan to measure and monitor project parameters in accordance with the tables in figures 8.1 and 8.2

Figure 8.1. Parameters for the surveillance of a project for the destruction of ODS contained in foam

 _________________________________________________________________________________ 
|                         |             |             |             |             |
| Parameter               | Factor      | Measurement | Method      | Measurement |
|                         | used in     | unit        |             | frequency   |
|                         | equations   |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total quantity of ODS   | BAinit      | Metric tonne| Calculated  | Each project|
| contained in foam prior |             | of ODS      |             | reporting   |
| to removal from         |             |             |             | period      |
| appliances              |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Initial quantity of ODS | BAinit, i   | Metric tonne| Calculated  | Each project|
| of type i contained in  |             | of ODS of   |             | reporting   |
| foam from appliances    |             | type i      |             | period      |
| prior to removal        |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Recovery efficiency     | RE          | O ≤  1       | Calculated  | Each project|
| associated with the     |             |             |             | reporting   |
| process for the         |             |             |             | period      |
| extraction of ODS       |             |             |             |             |
| contained in foam       |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total quantity of foam  | Foamrec     | Metric tonne| Measured and| Each project|
| removed prior to        |             | of foam     | calculated  | reporting   |
| extraction of ODS       |             |             |             | period      |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total emissions         | BApr        | Metric      | Calculated  | Each project|
| attributable to the     |             | tonne, CO2  |             | reporting   |
| extraction of ODS from  |             | equivalent  |             | period      |
| foam removed from       |             |             |             |             |
| appliances              |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total quantity of ODS   | BAfinal     | Metric tonne| Calculated  | Each project|
| contained in the foam   |             | of ODS      |             | reporting   |
| removed and sent for    |             |             |             | period      |
| destruction             |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total quantity of ODS   | BAfinal, i  | Metric tonne| Calculated  | Each project|
| of type i contained in  |             | of ODS of   |             | reporting   |
| foam extracted and sent |             | type i      |             | period      |
| for destruction         |             |             |             |             |
| under the project       |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Mass of each container  | N/A         | Metric tonne| Measured    | Each project|
| filled with ODS         |             |             |             | reporting   |
| contained in foam       |             |             |             | period      |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Mass of each empty      | N/A         | Metric tonne| Calculated  | Each project|
| container for projects  |             |             |             | reporting   |
| to destroy ODS contained|             |             |             | period      |
| in foam                 |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Quantity of ODS         | N/A         | Metric tonne| Calculated  | Each project|
| contained in foam, in   |             |             |             | reporting   |
| container each          |             |             |             | period      |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Concentration of each   | N/A         | %           | Measured    | Each project|
| type of ODS contained   |             |             |             | reporting   |
| in foam, in each        |             |             |             | period      |
| container               |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Quantity of each type   | N/A         | Metric      | Calculated  | Each project|
| of ODS contained in     |             | tonnes of   |             | reporting   |
| foam, in each container |             | ODS of      |             | period      |
|                         |             | type i      |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Emissions attributable  | (TR + DEST) | Metric      | Calculated  | Each project|
| to the transportation   |             | tonne, CO2  |             | reporting   |
| and destruction of ODS  |             | equivalent  |             | period      |
| contained in foam       |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Concentration of ODS    | CBA         | Metric tonne| Calculated  | Each project|
| in foam before          |             | of ODS per  |             | reporting   |
| extraction from         |             | metric tonne|             | period      |
| appliances              |             | of foam     |             |             |
|_________________________|_____________|_____________|_____________|_____________|                    

Figure 8.2. Parameters for the surveillance of a project for the destruction of ODS used as refrigerants

 
 _________________________________________________________________________________ 
|                         |             |             |             |             |
| Parameter               | Factor used | Measurement | Method      | Measurement |
|                         | in equations| unit        |             | frequency   |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Mass of each container  | N/A         | Metric      | Measured    | Each project|
| filled with ODS used as |             | tonne       |             | reporting   |
| refrigerants            |             |             |             | period      |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Mass of each empty      | N/A         | Metric      | Measured    | Each project|
| container for project   |             | tonne       |             | reporting   |
| to destroy ODS used as  |             |             |             | period      |
| refrigerants            |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Quantity of ODS used    | N/A         | Metric      | Calculated  | Each project|
| as refrigerants, in     |             | tonne       |             | reporting   |
| each container          |             |             |             | period      |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Concentration of each   | N/A         | %           | Analysed in | Each project|
| type of ODS used as a   |             |             | a laboratory| reporting   |
| refrigerant, in each    |             |             |             | period      |
| container               |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Quantity of each type   | N/A         | Metric      | Calculated  | Each project|
| of ODS used as a        |             | tonne of    |             | reporting   |
| refrigerant, in each    |             | ODS of      |             | period      |
| container               |             | type i      |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total quantity of ODS   | Qi          | Metric      | Calculated  | Each project|
| of type i used as       |             | tonne of    |             | reporting   |
| refrigerants removed and|             | ODS of      |             | period      |
| sent for destruction    |             | type i      |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total quantity of ODS   | Q           | Metric      | Calculated  | Each project|
| used as refrigerants    |             | tonne of    |             | reporting   |
| removed and sent for    |             | ODS         |             | period      |
| destruction             |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Total quantity of GHG   | Sub         | Metric      | Calculated  | Each project|
| emissions from          |             | tonne CO2   |             | reporting   |
| substitute refrigerants |             | equivalent  |             | period      |
|_________________________|_____________|_____________|_____________|_____________|
|                         |             |             |             |             |
| Emissions attributable  | (Tr + DEST)R| Metric      | Calculated  | Each project|
| to the transportation   |             | tonne  CO2  |             | reporting   |
| and destruction of ODS  |             | equivalent  |             | period      |
| used as refrigerants    |             |             |             |             |
|_________________________|_____________|_____________|_____________|_____________|            

(9) Extraction and analysis of ODS extracted in concentrated form from foam removed from appliances and of ODS used as refrigerants

In the case of ODS contained in foam, the promoter must use the same procedure during project implementation as that used to calculate extraction efficiency using the method in Part II of this protocol.

For each container, the promoter must use the method in this Division to calculate, on a mass basis, the total quantity of ODS of type i sent for destruction under the project, namely the factor BAfinal,i for projects for the destruction of ODS contained in foam and the factor Qi for projects for the destruction of ODS used as refrigerants.

(9.1) Determination of the quantity of ODS in each container

The quantity of ODS destroyed must be determined at the destruction facility by an authorized person, by weighing each container when it is full of ODS prior to destruction and after it has been emptied and its contents have been destroyed.

The quantity of ODS is equal to the difference between the mass of the container when full and when empty.

Each ODS container must be weighed at the destruction facility:

(1) using a single scale to generate both full and empty weight tickets;

(2) ensuring that the scale has been calibrated by the manufacturer or by a third person certified for that purpose less than 3 months before the weighing, to an accuracy of ± 5%;

(3) weighing the full container not more than 2 days prior to commencing the destruction of the ODS;

(4) weighing the empty container not more than 2 days after the destruction of the ODS.

Despite the first paragraph, until 31 December 2014, the containers may be weighed in a place other than the destruction facility provided it is less than 5 km from the facility.

Despite subparagraph 2 of the third paragraph, scales used prior to 31 December 2012 and subject to the Weights and Measures Act (R.S.C. 1985, c. W-6) may have been calibrated at the frequency specified by Measurement Canada provided that frequency does not exceed 2 years. However, if the first calibration after a weighing indicates that the weight of the ODS destroyed was overestimated, the promoter must correct the weight by deducting the error percentage recorded during the calibration.

(9.2) Circulation of mixed ODS

For each sample that does not contain over 90% of the same type of ODS, the promoter must, in addition to the conditions provided for in Division 9.1, also meet the following conditions concerning mixed ODS.

The circulation of the ODS mixture must be conducted at the destruction facility or prior to delivery of the ODS to such a facility, by a person who is independent of the promoter and of the destruction facility and who is properly trained to carry out this task.

The promoter must include the procedures used to analyze the ODS mixture in the project report.

Prior to sampling, the ODS mixture must be circulated in a container that meets all of the following conditions:

(1) the container has no solid interior obstructions other than mesh baffles or other interior structures that do not impede circulation;

(2) the container was fully evacuated prior to filling;

(3) the container has ports to sample liquid and gas phase ODS;

(4) the sampling ports are located in the middle third of the container and not at one end or the other;

(5) the container and associated equipment can circulate the mixture through a closed loop system from the bottom to top.

If the original mixed ODS container does not meet these requirements, the mixed ODS must be transferred into a compliant temporary container.

The mass of the ODS mixture transferred into the temporary container must be calculated and recorded. In addition, transfers of ODS between containers must be carried out at a pressure that meets the applicable standards for the place where the project is located.

Once the mixed ODS are in a container that meets the above criteria, they must be circulated as follows:

(1) liquid mixtures must be circulated from the liquid port to the vapour port;

(2) a volume of the mixture equal to 2 times the volume in the container must be circulated;

(3) circulation must occur at a rate of at least 114 litres per minute unless the liquid mixture has been circulating continuously for at least 8 hours;

(4) the start and end times must be recorded.

(9.3) Sampling

Sampling must be conducted for each ODS container:

(1) in the case of pure ODS, 1 sample must be taken at the destruction facility;

(2) in the case of ODS mixtures that have been circulated at the destruction facility, a minimum of 2 samples must be taken during the last 30 minutes of circulation and the samples must be taken from the bottom liquid port;

(3) in the case of ODS mixtures that have been circulated prior to delivery to the destruction facility, a minimum of 2 samples must be taken in accordance with subparagraph 2, and 1 additional sample must be taken at the destruction facility.

If more than one sample is taken for a single container, the promoter must use the results from the sample with the weighted ODS concentration with the least global warming potential.

The sampling must be conducted in accordance with the following conditions:

(1) the samples must be taken by a person who is independent of the promoter and of the destruction facility and has the necessary training to carry out this task;

(2) the samples must be taken with a clean, fully evacuated sample bottle with a minimum capacity of 0.454 kg;

(3) each sample must be taken in a liquid state;

(4) a minimum sample size of 0.454 kg must be drawn for each sample;

(5) each sample must be individually labeled and tracked according to the container from which it was taken;

(6) the following information must be recorded for each sample:

(a) the time and date of the sample;

(b) the name of the promoter for whom the sampling is conducted;

(c) the name and contact information of the technician who took the sample, and of the technician’s employer;

(d) the volume of the container from which the sample was drawn;

(e) the ambient air temperature at the time of sampling;

(f) the chain of traceability of each sample, from the point of sampling to the accredited laboratory.

Despite subparagraph 3 of the first paragraph, in the case of ODS mixtures circulated before 31 December 2012, a minimum of 1 sample must be taken in accordance with subparagraph 2 of the first paragraph and 1 extra sample must be taken at the destruction facility.

(9.4) Analysis of samples

The quantity and type of ODS must be determined by having a sample from each container analyzed by one of the following laboratories:

(1) the Centre d’expertise en analyse environnementale du Québec of the department;

(2) a laboratory that is independent of the promoter and of the destruction facility and accredited for analysis of ODS by the Air-Conditioning, Heating and Refrigeration Institute in accordance with the most recent version of AHRI 700 of that organization.

All the ODS samples for the project must be sampled to determine the following:

(1) the type of each ODS;

(2) the quantity, in metric tonnes, and concentration, in metric tonnes of ODS of type i per metric tonne of gas, in each type of ODS in the gas, using gas chromatography;

(3) the moisture content of each sample;

(4) the high boiling residue from the ODS sample, which must be below 10% of the total mass of the sample.

If the moisture content determined under subparagraph 3 of the second paragraph is above 75% of the saturation point for the ODS, the promoter must dry the ODS mixture, take the sample again and analyze it in accordance with the method in Division 9.2 or deduct the weight of the water, which includes the weight of the layer of free water floating on the ODS and the amount of dissolved water in the ODS.

In the case of ODS mixtures, the analysis must determine the weighted concentrations of the ODS on the basis of their global warming potential for samples taken in accordance with subparagraph 2 of the first paragraph of Division 9.3.

A certificate of the sampling results must be issued by the laboratory that conducted the analysis and a copy of the certificate must be included with the project report.

(9.5) Determination of the total quantity of ODS of type i contained in foam extracted and sent for destruction (BAfinal, i) and the total quantity of ODS of type i used as refrigerants extracted and sent for destruction (Qi)

Based on the mass of the ODS in each container and the concentration of each sample, the promoter must

(1) calculate the quantity of each type of ODS in each container, by deducting the weight of the water if the moisture content is above 75% of the saturation point and the ODS has not been dried, and deducting the weight of the high boiling residue;

(2) add together the quantities of each type of ODS in each container to obtain the factor BAfinal, i, namely the total quantity of ODS of type i contained in the foam, or the factor Qi, namely the total quantity of ODS of type i used as refrigerants extracted and sent for destruction under the project.

(10) Destruction facilities

The operating parameters for the facility during ODS destruction must be monitored and recorded in accordance with the Code of Good Housekeeping approved by the Montréal Protocol.

The verifier must use the data to show that, during the ODS destruction process, the facility was operating in conditions that met the requirements of any authorization necessary to pursue activities at that facility.

The promoter must continuously monitor the following parameters during the entire ODS destruction process:

(1) the ODS feed rate;

(2) the operating temperature and pressure of the destruction facility during ODS destruction;

(3) effluent discharges measured in terms of water and pH levels;

(4) carbon monoxide emissions.

Each stage in a project carried out in the United States must be conducted in accordance with the requirements of the most recent version of the protocol entitled “Compliance Offset Protocol Ozone Depleting Substances Projects: Destruction of U.S. Ozone Depleting Substances Banks” and published by the California Air Resources Board and the California Environmental Protection Agency.

(11) Verification

The verification process must include a visit

(1) of the place where ODS contained in foam are extracted, at least once during the first project verification; and

(2) of each destruction facility for the project, during each project verification.

Part II

Calculation of ODS extraction efficiency in foam removed from appliances

To calculate extraction efficiency in accordance with Division 2, the promoter must first calculate the quantity of ODS contained in foam prior to removal from appliances, based on the storage capacity of the appliances, using equation 7 and the table in Figure 1 of Subdivision 1.1 or using foam samples in accordance with Subdivision 1.2.

(1) Calculation methods for the initial quantity of ODS contained in foam

(1.1) Calculation of the initial quantity of ODS contained in foam based on the storage capacity of the appliances

The promoter may calculate the initial quantity of ODS contained in foam using equation 7 and data from the table in Figure 1:

Equation 7

BAinit = (N1 × M1) + (N2 × M2) + (N3 × M3) + (N4 × M4)

Where:

BAinit = Initial quantity of ODS contained in foam prior to removal from appliances, in metric tonnes;

N1 = Number of appliances of type 1;

N2 = Number of appliances of type 2;

N3 = Number of appliances of type 3;

N4 = Number of appliances of type 4;

M1 = Metric tonnes of ODS per appliance of type 1;

M2 = Metric tonnes of ODS per appliance of type 2;

M3 = Metric tonnes of ODS per appliance of type 3;

M4 = Metric tonnes of ODS per appliance of type 4.

Figure 1. Quantity of ODS by type of appliance

 _______________________________________________________________________________ 
|                     |                              |                          |
| Type of appliance   | Storage capacity (SC)        |   Metric tonnes of ODS   |
|                     |                              |   per appliance          |
|_____________________|______________________________|__________________________|
|                     |                              |                          |
| Type 1              | SC < 180 litres              |   0.00024                | 
|_____________________|______________________________|__________________________|
|                     |                              |                          |
| Type 2              | 180 litres ≤ SC < 350 litres |   0.00032                |
|_____________________|______________________________|__________________________|
|                     |                              |                          |
| Type 3              | 350 litres ≤ SC < 500 litres |   0.0004                 |
|_____________________|______________________________|__________________________|
|                     |                              |                          |
| Type 4              | SC ≥ 500 litres              |   0.00048             |
|_____________________|______________________________|__________________________|
                      

(1.2) Calculation of the initial quantity of ODS contained in foam based on samples

The initial quantity of ODS contained in foam may be calculated using samples from at least 10 appliances and the following method:

(1) have the initial concentration of ODS in the foam determined by a laboratory independent of the promoter in accordance with Division 9.1 of Part I and in the following manner:

(a) by cutting 4 foam samples from each appliance (left side, right side, top, bottom) using a reciprocating saw, each sample being at least 10 cm2 and the full thickness of the insulation;

(b) by sealing the cut edges of each foam sample using aluminum tape or a similar product that prevents off gassing;

(c) by individually labelling each sample to record appliance model and site of sample (left, right, top, bottom);

(d) by analyzing the samples using the procedure in paragraph 4; the samples may be analyzed individually (4 analyses per appliance) or a single analysis may be done using equal masses of foam from each sample (1 analysis per appliance);

(e) based on the average concentration of ODS in the samples from each appliance, by calculating the 90% upper confidence limit of the ODS concentration in the foam, and using that value as the “CBA” factor in equation 8 to calculate initial quantity of ODS contained in foam from appliances;

(2) determine the quantity of foam removed from the appliances processed, namely the factor “Foamrec” in equation 8, using a default value of 5.85 kg per appliance and multiplying by the number of appliances processed or using the following method:

(a) by separating and collecting all foam residual, which may be in a fluff, power or pelletized form, and documenting the processed to demonstrate that no significant quantity of foam residual is lost in the air or other waste streams;

(b) by separating non-foam components in the residual (such as metal or plastic);

(c) by weighing the recovered foam residual prior to ODS extraction to calculate the total mass of foam recovered;

(3) calculate the initial quantity of ODS contained in foam prior to removal from appliances using equation 8:

Equation 8

BAinit = Foamrec × CBA

Where:

BAinit = Initial quantity of ODS contained in foam prior to removal from appliances, in metric tonnes;

Foamrec = Total quantity of foam recovered prior to ODS extraction, in metric tonnes;

CBA = Concentration of ODS in the foam prior to removal from appliances, in metric tonnes de ODS per metric tonne of foam;

(4) analyze the foam samples from appliance in accordance with the following requirements:

(a) the analysis of the content and mass ratio of the ODS from foam must be done at an independent laboratory in accordance with Division 9.1 of Part I;

(b) the analysis must be done using the heating method to extract ODS from the foam in the foam samples, as described in the article “Release of fluorocarbons from Insulation foam in Home Appliance during Shredding” published by Scheutz, Fredenslund, Kjeldsen and Tant in the Journal of the Air & Waste Management Association (December 2007, Vol. 57, pages 1452-1460), and set out below:

i. each sample must be prepared to a thickness no greater than 1 cm, placed in a 1123 ml glass bottle, weighed using a calibrated scale, and sealed with Teflon-coated septa and aluminum caps;

ii. to release the ODS, the sample must be incubated in an oven for 48 hours at 140 °C;

iii. when cooled to room temperature, gas samples must be redrawn from the headspace and analyzed by gas chromatography in accordance with Division 9.1 of Part I;

iv. the lids must be removed after analysis, and the headspace must be flushed with atmospheric air for approximately 5 minutes using a compressor; afterwards, the septa and caps must be replaced and the bottles subjected to a second 48-hour heating step to drive out the remaining ODS from the sampled foam;

v. when cooled down to room temperature after the second heating step, gas samples must be redrawn from the headspace and analyzed by gas chromatography in accordance with Division 9.1 of Part I;

(c) the quantity of each type of ODS recovered must then de divided by the total mass of the initial foam samples prior to analysis to determine the mass ratio of ODS present, in metric tonnes of ODS per metric tonne of foam.

(2) Calculation methods for extraction efficiency

The promoter must calculate the extraction efficiency using equation 9:

Equation 9

BAfinal

EE = _________

BAinit

Where:

EE = Extraction efficiency;

BAfinal = Total quantity of ODS contained in foam removed and sent for destruction, calculated using equation 10, in metric tonnes;

BAinit = Initial quantity of ODS contained in foam prior to removal from appliances, calculated using equation 7 or 8, as the case may be, in metric tonnes;

Equation 10

Where:

BAfinal = Total quantity of ODS contained in foam removed and sent for destruction, in metric tonnes;

i = Type of ODS;

n = Number of types of ODS;

BAfinal, i = Total quantity of ODS of type i extracted and sent for destruction, determined in accordance with Division 9.1 of Part I, in metric tonnes.

PROTOCOL 4

ACTIVE COAL MINES – DESTRUCTION OF CH4 FROM A DRAINAGE SYSTEM

Part I

(1) Projects covered

This offset credit protocol covers any project designed to reduce GHG emissions by capturing and destroying CH4 from a CH4 drainage system at an active underground or surface coal mine, except a mountaintop removal mine.

The project must enable the capture and destruction of CH4 that, before the project, was emitted to the atmosphere. The CH4 must be captured within the mine boundaries based on the current mine map and no more than 50 m below the mined seam and, in the case of an underground mine, up to 150 m above that seam. The project must not use CO2, steam or any other fluid or gas to enhance CH4 drainage.

The CH4 must be destroyed on the site of the mine where it was captured using a flare or any other destruction device. Emission reductions following pipeline injection of CH4 are considered as common practice in the operation of an underground mine and are eligible only for a surface mine.

For the purposes of this protocol,

(1) “room and pillar” means a method of underground mining in which approximately half of the coal is left in place as “pillars” to support the roof of the active mining area while “rooms” of coal are extracted;

(2) “coal” means all solid fuels classified as anthracite, bituminous, subbituminous, or lignite under ASTM D388, entitled Standard Classification of Coals by Rank;

(3) “mine gas” means the untreated gas extracted from within a mine through a CH4 drainage system that often contains various levels of other components such as nitrogen, oxygen, CO2 and hydrogen sulfide;

(4) “mine CH4” means the CH4 portion of the mine gas contained in coal seams and surrounding strata that is released as a result of mining operations;

(5) “drainage system” means a system installed in a mine to drain CH4 from coal seams.

(2) First project report

In addition to the information required under the second paragraph of section 70.5 of this Regulation, the first project report must include the following information:

(1) in the case of an underground mine, the mining method employed, such as room and pillar or longwall;

(2) annual coal production, in metric tonnes;

(3) the year of initial mine operation;

(4) the scheduled year of mine closure, if known;

(5) a diagram of the mine site that includes

(a) the location of existing and planned wells and boreholes, specifying whether they were used for premining or post-mining drainage, and whether they are part of the project;

(b) the location of the equipment that will be used to treat or destroy the mine CH4.

(3) Location

The project must be implemented in Canada.

(4) Reduction project SSRs

The reduction project process flowchart in Figure 4.1 and the table in Figure 4.2 show all the SSRs that must be taken into account by the promoter when calculating the GHG emission reductions attributable to the project.

All the SSRs within the dotted line must be counted for the purposes of this protocol.

Figure 4.1. Flowchart for the reduction project process

Figure 4.2. Reduction project SSRs

 _________________________________________________________________________________
|            |                        |         |                      |          |
| SSR        | Description            |   GHG   |     Relevant to      | Included/|
| #          |                        |         |     Baseline (B)     | Excluded |
|            |                        |         |     or Project       |          |
|            |                        |         |        (P)           |          |
|            |                        |         |                      |          |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 1          | CH4 emissions          | CH4     | B, P                  | Included|
|            | from mining activities |         |                      |          |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 2          | Emissions from         | CO2     | P                    | Excluded |
|            | construction           |_________|                      |__________|
|            | and/or                 |         |                      |          |
|            | installation of        | CH4     |                      | Excluded |
|            | new equipment          |_________|                      |__________|
|            |                        |         |                      |          |
|            |                        | N2O     |                      | Excluded |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 3          | Emissions              | CO2     | P                    | Included |
|            | resulting from         |_________|                      |__________|
|            | fossil fuels           |         |                      |          |
|            | consumed to            | CH4     |                      | Excluded |
|            | operate the CH4        |_________|                      |__________|
|            | drainage system        |         |                      |          |
|            |                        | N2O     |                      | Excluded |
|            |                        |         |                      |          |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 4          | Emissions from         | CO2     | P                    | Included |
|            | the use of             |_________|                      |__________|
|            | supplmental            |         |                      |          |
|            | fossil fuels           | CH4     |                      | Excluded |
|            |                        |_________|                      |__________|
|            |                        |         |                      |          |
|            |                        | N2O     |                      | Excluded |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 5          | Emissions from         | CO2     | P                    | Included |
|            | CH4 destruction        |_________|                      |__________|
|            | for electricity        |         |                      |          |
|            | generation             | N2O     |                      | Excluded |
|            |________________________|_________|______________________|__________|
|            |                        |         |                      |          |
|            | Emissions of           | CH4     | P                    | Included |
|            | uncombusted CH4        |         |                      |          |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 6          | Emissions from         | CO2     | P                    | Included |
|            | CH4 destruction        |_________|                      |__________|
|            | for heat               |         |                      |          |
|            | generation             | N2O     |                      | Excluded |
|            |                        |         |                      |          |
|            |________________________|_________|______________________|__________|
|            |                        |         |                      |          |
|            | Emissions of           | CH4     | P                    | Included |
|            | uncombusted CH4        |         |                      |          |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 7          | Emissions from         | CO2     | P                    | Included |
|            | CH4 destruction        |_________|                      |__________|
|            | using a flare or       |         |                      |          |
|            | other device           | N2O     |                      | Excluded |
|            |                        |         |                      |          |
|            |________________________|_________|______________________|__________|
|            |                        |         |                      |          |
|            | Emissions of           | CH4     | P                    | Included |
|            | uncombusted CH4        |         |                      |          |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
| 8          | Pipeline injection     | CO2     | P                    | Excluded |
|(Underground|                        |_________|                      |__________|
| mine)      |                        |         |                      |          |
|            |                        | N2O     |                      | Excluded |
|            |                        |_________|                      |__________|
|            |                        |         |                      |          |
|            |                        | CH4     |                      | Excluded |
|____________|________________________|_________|______________________|__________|
|            |                        |         |                      |          |
|            | Emissions              | CO2     | P                    | Included |
| 8          | resulting from the     |_________|                      |__________|
|(Surface    | combustion of          |         |                      |          |
| mine)      | CH4 injected into      | N2O     |                      | Excluded |
|            | a pipeline             |         |                      |          |
|            |________________________|_________|______________________|__________|
|            |                        |         |                      |          |
|            | Emissions of           | CH4     | P                    | Included |
|            | uncombusted            |         |                      |          |
|            | CH4 injected into      |         |                      |          |
|            | a pipeline             |         |                      |          |
|____________|________________________|_________|______________________|__________|        

(5) Calculation method for the GHG emission reductions attributable to the project

The promoter must calculate the quantity of GHG emission reductions attributable to the project using equation 1:

Equation 1

ER = BE - PE

Where:

ER = GHG emission reductions attributable to the project during the project reporting period, in metric tonnes CO2 equivalent;

BE = Emissions under the baseline scenario during the project reporting period, calculated using equation 3, in metric tonnes CO2 equivalent;

PE = Project emissions during the project reporting period, calculated using equation 5, in metric tonnes CO2 equivalent.

When the flow meter does not correct for the temperature and pressure of the mine gas at standard conditions, the promoter must measure mine pressure and temperature separately and correct the flow values using equation 2. The promoter must use the corrected flow values in all the equations of this protocol.

Equation 2

293.15 P

MGi,t = MGuncorrected × ________ × _______

T 101.325

Where:

MGi,t = Volume of mine gas sent to destruction device i in time interval t, in cubic metres at standard conditions;

i = Destruction device;

t = Time interval shown in the table in Figure 6.1 for which CH4 flow and content measurements are aggregated;

MGuncorrected = Uncorrected volume of mine gas sent to destruction device i in time interval t, in cubic metres;

293.15 = Reference temperature, in Kelvin;

T = Measured temperature of mine gas for the given time period, in Kelvin (°C + 273.15);

P = Pressure of the mine gas for the given time period, in kilopascals;

101.325 = Standard pressure, in kilopascals.

(5.1) Calculation method for GHG emissions in the baseline scenario

In the baseline scenario, CH4 sent to a destruction device during the project reporting period, except CH4 captured by a pre-mining surface well used to extract CH4, must be taken into account.

In the case of a surface well used to extract CH4 before a mining operation, CH4 emissions from past periods are considered only during a project reporting period when the well is mined through, in other words when one of the following situations occurs:

(1) the well is physically bisected by mining activities;

(2) the well produces elevated amounts of atmospheric gases so that the concentration of nitrogen in the mine gas increases by 5 compared to baseline concentrations according to a gas analysis using a gas chromatograph completed by an ISO 17025 accredited laboratory. To ensure that the elevated nitrogen concentrations are not solely the result of a leak in the well, the oxygen concentration must not have increased by the same proportion as the nitrogen concentration;

(3) in the case of an underground mine, the working face passes less than 150 m below the well;

(4) in the case of an underground mine, the room and pillar method is used and the block of coal that will be left unmined as a pillar is less than 150 m directly below the well.

The promoter must calculate GHG emissions in the baseline scenario using equation 3:

Equation 3

Where:

BE = Baseline scenario emissions during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of destruction devices;

i = Destruction device;

Qi = Total quantity of CH4 sent to destruction device i during the project reporting period, calculated using equation 4, in cubic metres of CH4 at standard conditions;

0.667 = Density of CH4, in kilograms of CH4 per cubic metre of CH4 at standard conditions;

0.001 = Conversion factor, kilograms to metric tonnes;

21 = Global Warming Potential factor of CH4;

Equation 4

Where:

Qi = Total quantity of CH4 sent to destruction device i during the project reporting period, in cubic metres of CH4 at standard conditions;

n = Number of time intervals during the project reporting period;

t = Time interval shown in the table in Figure 6.1 for which CH4 flow and content measurements for the mine gas are aggregated;

MGi,t = Volume of mine gas sent to destruction device i in time interval t, in cubic metres at standard conditions, except mine gas from a surface well that is not yet mined through. Despite the foregoing, if the surface well is mined through during the project reporting period, the mine gas sent to a destruction device during the current reporting period and in previous years must be included;

CCH4,t = Average CH4 content in the mine gas sent to a destruction device during time interval t, in cubic metres of CH4 per cubic metre of mine gas.

(5.2) Calculation method for GHG project emissions

The promoter must calculate the GHG project emissions using equations 5 to 8. The CO2 emissions attributable to the destruction of CH4 from a pre-mining surface well used to extract CH4 during a current project reporting period, calculated using equation 7, must be included even if the well has not yet been mined through.

Equation 5

PE = FFCO2 + DMCO2 + UMCH4

Where:

PE = Project emissions during the project reporting period, in metric tonnes CO2 equivalent;

FFCO2 = Total CO2 emissions attributable to the consumption of fossil fuel to capture and destroy mine CH4 during the project reporting period, calculated using equation 6, in metric tonnes CO2 equivalent;

DMCO2 = Total CO2 attributable to the destruction of CH4 during the project reporting period, calculated using equation 7, in metric tonnes CO2 equivalent;

UMCH4 = CH4 emissions attributable to uncombusted CH4 during a project reporting period, calculated using equation 8, in metric tonnes CO2 equivalent;

Equation 6

Where:

FFCO2 = Total CO2 attributable to the consumption of fossil fuel to capture and destroy mine CH4 during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of types of fossil fuel;

j = Type of fossil fuel;

FFPR,j = Total quantity of fossil fuel j consumed, expressed

— in kilograms, in the case of fuels whose quantity is expressed as a mass;

— in cubic metres at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in litres, in the case of fuels whose quantity is expressed as a volume of liquid;

EFCF,j = CO2 emission factor for fossil fuel j specified in tables 1-3 to 1-8 of QC.1.7 in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), expressed

— in kilograms of CO2 per kilogram, in the case of fuels whose quantity is expressed as a mass;

— in kilograms of CO2 per cubic metre at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in kilograms of CO2 per litre, in the case of fuels whose quantity is expressed as a volume of liquid;

1,000 = Conversion factor, metric tonnes to kilograms;

Equation 7

Where:

DMCO2 = Total CO2 attributable to the destruction of CH4 during a project reporting period, in metric tonnes CO2 equivalent;

n = Number of destruction devices;

i = Destruction device;

Qi = Total quantity of CH4 sent to destruction device i during the project reporting period, calculated using equation 4, in cubic metres of CH4 at standard conditions;

DEi = Default CH4 destruction efficiency of destruction device i, determined in accordance with Part II;

1.556 = CO2 emission factor attributable to the combustion of CH4, in kilograms of CO2 per cubic metre of CH4 combusted;

0.001 = Conversion factor, kilograms to metric tonnes;

Equation 8

Where:

UMCH4 = CH4 emissions attributable to uncombusted CH4 during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of destruction devices;

i = Destruction device;

Qi = Total quantity of CH4 sent to destruction device i during the project reporting period, calculated using equation 4, in cubic metres of CH4 at standard conditions;

DEi = Default CH4 destruction efficiency of destruction device i, determined in accordance with Part II;

0.667 = Density of CH4, in kilograms of CH4 per cubic metre of CH4 at standard conditions;

0.001 = Conversion factor, kilograms to metric tonnes;

21 = Global Warming Potential factor of CH4.

(6) Project surveillance

(6.1) Data collection

The promoter is responsible for collecting the information required for project monitoring.

The promoter must show that the data collected are actual and that rigorous supervision and record-keeping procedures are applied at the project site.

(6.2) Surveillance plan

The promoter must establish a surveillance plan to measure and monitor project parameters in accordance with Figure 6.1:

Figure 6.1. Project surveillance plan

 __________________________________________________________________________________
|                   |             |            |                |                  |
| Parameter         | Factor used | Unit of    | Method         | Frequency of     |
|                   | in equations| measurement|                | measurement      |
|___________________|_____________|____________|________________|__________________|
|                   |             |            |                |                  |
| Operating         | N/A         | Degree     | Measured for   | Hourly           |
| status of         |             | Celsius or | each           |                  |
| destruction       |             | other,     | destruction    |                  |
| device            |             | depending  | device         |                  |
|                   |             | on the     |                |                  |
|                   |             | device     |                |                  |
|                   |             | installed  |                |                  |
|___________________|_____________|____________|________________|__________________|
|                   |             |            |                |                  |
| Uncorrected       |MGuncorrected    |Cubic metre | Measured       | Only when       |
| volume of         |             |            |                | flow data are    |
| mine gas sent     |             |            |                | not adjusted     |
| to destruction    |             |            |                | at standard      |
| device i, in      |             |            |                | conditions       |
| time interval t   |             |            |                |                  |
|___________________|_____________|____________|________________|__________________|
|                   |             |            |                |                  |
| Volume of         | MGi, t       | Cubic metre| Measured and   | Continuous       |
| mine gas sent     |             | at         | calculated     | and recorded     |
| to destruction    |             | standard   |                | at least every   |
| device i, in      |             | conditions |                | 15 minutes to    |
| time interval t   |             |            |                | calculate a      |
|                   |             |            |                | daily average,   |
|                   |             |            |                | and adjusted     |
|                   |             |            |                | for              |
|                   |             |            |                | temperature      |
|                   |             |            |                | and pressure     |
|___________________|_____________|____________|________________|__________________|
|                   |             |            |                |                  |
| Average CH4       | CCH4, t       |Cubic metre | Measured       | Continuous       |
| content in the    |             | of CH4 per | continuously   | and recorded     |
| mine gas sent     |             | cubic metre|                | at least every   |
| to destruction    |             | of gas at  |                | 15 minutes to    |
| device during     |             | standard   |                | calculate a      |
| time interval t   |             | conditions |                | daily average    |
|___________________|_____________|____________|________________|__________________|
|                   |             |            |                |                  |
| Total quantity    | FFPR, j       | Kilogram   | Calculated     | At each         |
| of fossil fuels   |             | (solid)    | using fossil   | reporting        |
| combustibles      |             |            | fuel           | period           |
| consumed by       |             | Cubic metre| purchasing     |                  |
| the capture       |             | at standard| register       |                  |
| and               |             | conditions |                |                  |
| destruction       |             | (gas)      |                |                  |
| system during     |             |            |                |                  |
| the project       |             |            |                |                  |
| reporting         |             |            |                |                  |
| period, by        |             | Litre      |                |                  |
| type of fuel j    |             | (liquid)   |                |                  |
|___________________|_____________|____________|________________|__________________|
|                   |             |            |                |                  |
| Measured          | T           | °C         | Measured       | Hourly           |
| temperature       |             |            |                |                  |
| of mine gas       |             |            |                |                  |
|___________________|_____________|____________|________________|__________________|
|                   |             |            |                |                  |
| Pressure of       | P           | kPa        | Measured       | Hourly           |
| mine gas          |             |            |                |                  |
|                   |             |            |                |                  |
|___________________|_____________|____________|________________|__________________|        

The surveillance plan must

(1) specify the methods used to collect and record the data required for all the relevant parameters in the table in Figure 6.1;

(2) specify

(a) the frequency of data acquisition;

(b) the frequency of instrument cleaning, inspection and calibration activities, and of the verification of instrument calibration accuracy; and

(c) the role of the person responsible for each monitoring activity, as well as the quality assurance and quality control measures taken to ensure that data acquisition and instrument calibration are carried out consistently and with precision; and

(3) contain a detailed diagram of the mine gas capture and destruction system, including the placement of all measurement instruments and equipment that affect included SSRs.

The promoter is responsible for carrying out and monitoring project performance. The promoter must use the mine gas destruction device and the measurement instruments in accordance with the manufacturer’s specifications. The promoter must, in particular, use measurement instruments to measure directly

(1) the flow of mine gas sent to each destruction device, continuously, recorded every 15 minutes and totalized as a daily average, adjusted for temperature and pressure;

(2) the CH4 content of the mine gas sent to each destruction device, continuously, recorded every 15 minutes and totalized as a daily average.

When temperature and pressure must be measured to correct flow values at standard conditions, the parameters must be measured at least hourly.

The operating status of the mine gas destruction device must be monitored and recorded at least hourly.

For every destruction device, the promoter must show, in the first project report, that a monitoring device has been installed to verify the operation of each destruction device. The promoter must also show, in each subsequent project report, that the monitoring device has operated correctly.

GHG emission reductions will not be taken into account for the issue of offset credits for periods during which the destruction device or the monitoring device for the operation of the destruction device is not operating.

(6.3) Measurement instruments

The promoter must ensure that all mine gas flow meters and CH4 analyzers are

(1) cleaned and inspected as specified in the project’s surveillance plan and at the minimum cleaning and inspection frequency specified by the manufacturer, with all cleaning and inspection activities documented by personnel;

(2) not more than 2 months before or after the project reporting period end date, either

(a) checked for calibration accuracy by a qualified and independent person, using a portable instrument, such as a pitot tube, or in accordance with the manufacturer’s specifications, and ensure that the percentage drift is recorded; or

(b) calibrated by the manufacturer or by a third person certified for that purpose by the manufacturer; and

(3) calibrated by the manufacturer or by a third person certified for that purpose by the manufacturer or every 5 years, whichever is more frequent.

A calibration certificate or a verification report on calibration accuracy must be produced and included in the project report. The verification provided for in section 70.16 of this Regulation must include confirmation that the person is qualified to verify calibration accuracy.

Flow meter calibrations must be documented to show that the meter was calibrated to a range of flow rates corresponding to the flow rates expected for the drainage system.

CH4 analyzer calibrations must be documented to show that the calibration was carried out to a range of temperature and pressure conditions corresponding to the range of conditions measured for the drainage system.

The verification of flow meter and analyzer calibration accuracy must show that the instruments provide a reading of volumetric flow or CH4 content that is within a +/-5% accuracy threshold.

When a verification of the calibration accuracy of a device shows a shift outside the +/-5% accuracy threshold, the device must be calibrated by the manufacturer or by a third person certified for that purpose by the manufacturer. In addition, for the entire period from the last calibration that confirmed accuracy within the ± 5% threshold until such time as the piece of equipment is correctly calibrated, the promoter must use the more conservative of

(1) the measured values without correction;

(2) the adjusted values based on the greatest calibration drift recorded at the time of calibration.

The last calibration confirming accuracy within the ± 5% threshold must not have taken place more than 2 months before the end date for the project reporting period.

No offset credit may be issued for a project reporting period when the calibration or verification of the calibration accuracy of the required instruments has not been correctly carried out and documented.

(6.4) Data management

Information on data procedures and data monitoring must be managed in a way that guarantees the integrity, exhaustiveness, accuracy and validity of the data.

The promoter must keep the following documents and information:

(1) the information required under the surveillance plan;

(2) information on each flow meter, CH4 analyzer and destruction device used, including type, their model number, serial number and manufacturer’s maintenance and calibration procedures;

(3) the calibration date, time and results for CH4 analyzers and flow meters, and the corrective measures applied if a piece of equipment fails to meet the requirements of this Regulation;

(4) the maintenance records for capture, destruction and monitoring systems;

(5) operating records showing annual coal production.

(6.5) Missing data – replacement methods

In situations where data on flow rates or CH4 content are missing, the promoter must apply the data replacement methods set out in Part III.

Part II

Destruction efficiencies for destruction devices

The promoter must use the destruction efficiency shown in Table 1 for the project destruction device.

Table 1. Default destruction efficiencies for destruction devices

 __________________________________________________________________________________
|                                            |                                     |
| Destruction device                         | Efficiency                          |
|____________________________________________|_____________________________________|
|                                            |                                     |
| Open flare                                 | 0.96                                |
|____________________________________________|_____________________________________|
|                                            |                                     |
| Enclosed flare                             | 0.995                               |
|____________________________________________|_____________________________________|
|                                            |                                     |
| Internal combustion engine                 | 0.936                               |
|____________________________________________|_____________________________________|
|                                            |                                     |
| Boiler                                     | 0.98                                |
|____________________________________________|_____________________________________|
|                                            |                                     |
| Microturbine or large gas turbine          | 0.995                               |
|____________________________________________|_____________________________________|
|                                            |                                     |
| Upgrade and injection into a pipeline      | 0.96                                |
| (surface mine)                             |                                     |
|____________________________________________|_____________________________________|        

Part III

Missing data – replacement methods

The replacement methods below may be used only

(1) for missing mine gas flow rate or CH4 content parameters;

(2) for missing data that are discrete, non-chronic and due to unforeseen circumstances;

(3) when the proper functioning of the destruction device can be shown by thermocouple readings at the flare or at the other devices of the same nature;

(4) to replace data on mine gas flow rates when it is shown that CH4 content was consistent with normal operations for the time when the data are missing; and

(5) to replace data on CH4 content when it is shown that the mine gas flow rate was consistent with normal operations for the time when the data are missing.

No offset credit may be issued for periods when the replacement methods cannot be used.

 __________________________________________________________________________________
|                                      |                                           |
| Missing data period                  | Replacement method                        |
|______________________________________|___________________________________________|
|                                      |                                           |
| Less than 6 hours                    | Use the average of the 4 hours            |
|                                      | immediately before and following the      |
|                                      | missing data period                       |
|______________________________________|___________________________________________|
|                                      |                                           |
| 6 to less than 24 hours              | Use the 90% upper or lower                |
|                                      | confidence limit of the 24 hours prior to |
|                                      | and after the missing data period,        |
|                                      | whichever results in greater              |
|                                      | conservativeness                          |
|______________________________________|___________________________________________|
|                                      |                                           |
| 1 to 7 days                          | Use the 95% upper or lower                |
|                                      | confidence limit of the 72 hours prior to |
|                                      | and after the missing data period,        |
|                                      | whichever results in greater              |
|                                      | conservativeness                          |
|______________________________________|___________________________________________|
|                                      |                                           |
| More than 7 days                     | No data may be replaced and no            |
|                                      | reduction may be credited                 |
|                                      |                                           |
|______________________________________|___________________________________________|        

PROTOCOL 5

ACTIVE UNDERGROUND COAL MINES – DESTRUCTION OF CH4 FROM VENTILATION AIR

Part I

(1) Projects covered

This offset credit protocol covers any project designed to reduce GHG emissions by capturing and destroying CH4 from the ventilation system of an active underground coal mine.

The project must enable the capture and destruction of CH4 that, before the project, was emitted to the atmosphere. The CH4 must be captured within the mine boundaries based on the current mine map and must be destroyed on the site of the mine where it was captured using a destruction device.

For the purposes of this protocol,

(1) “ventilation air” means air from a mine ventilation system;

(2) “coal” means all solid fuels classified as anthracite, bituminous, subbituminous, or lignite under ASTM D388, entitled Standard Classification of Coals by Rank;

(3) “ventilation air CH4” means the CH4 contained in ventilation air.

(2) First project report

In addition to the information required under the second paragraph of section 70.5 of this Regulation, the first project report must include the following information:

(1) the mining method employed, such as room and pillar or longwall;

(2) annual coal production;

(3) the year of initial mine operation;

(4) the scheduled year of mine closure, if known;

(5) a diagram of the mine site that includes

(a) the location of existing and planned ventilation shafts, specifying whether they are part of the project;

(b) the location of the equipment that will be used to treat or destroy ventilation air CH4.

(3) Location

The project must be implemented in Canada.

(4) Reduction project SSRs

The reduction project process flowchart in Figure 4.1 and the table in Figure 4.2 show all the SSRs that must be taken into account by the promoter when calculating the GHG emission reductions attributable to the project.

All the SSRs within the dotted line must be counted for the purposes of this protocol.

Figure 4.1. Flowchart for the reduction project process

Figure 4.2. Reduction project SSRs

 _________________________________________________________________________________
|     |                               |         |                      |          |
| SSR | Description                   |   GHG   |    Relevant to       | Included/|
| #   |                               |         |    Baseline (B)      | Excluded |
|     |                               |         |     or Project       |          |
|     |                               |         |        (P)           |          |
|_____|_______________________________|_________|______________________|__________|
|     |                               |         |                      |          |
| 1   | Emissions of                  | CH4     | B, P                 | Included |
|     | ventilation air CH4           |         |                      |          |
|_____|_______________________________|_________|______________________|__________|
|     |                               |         |                      |          |
| 2   | Emissions                     | CO2     | B, P                 | Excluded |
|     | attributable to               |_________|                      |__________|
|     | energy                        |         |                      |          |
|     | consumed to                   | CH4     |                      | Excluded |
|     | operate mine                  |_________|                      |__________|
|     | ventilation system            |         |                      |          |
|     |                               | N2O     |                      | Excluded |
|_____|_______________________________|_________|______________________|__________|
|     |                               |         |                      |          |
| 3   | Emissions                     | CO2     | P                    | Included |
|     | attributable to               |_________|                      |__________|
|     | energy                        |         |                      |          |
|     | consumed to operate           | CH4     |                      | Excluded |
|     | equipment to                  |_________|                      |__________|
|     | capture and destroy           |         |                      |          |
|     | ventilation air CH4           | N2O     |                      | Excluded |
|     |                               |         |                      |          |
|_____|_______________________________|_________|______________________|__________|
|     |                               |         |                      |          |
| 4   | Emissions                     | CO2     | P                    | Included |
|     | from the                      |_________|                      |__________|
|     | destruction of                |         |                      |          |
|     | ventilation air CH4           | N2O     |                      | Excluded |
|     |_______________________________|_________|______________________|__________|
|     |                               |         |                      |          |
|     | Emissions of                  | CH4     | P                    | Included |
|     | uncombusted                   |         |                      |          |
|     | ventilation air CH4           |         |                      |          |
|_____|_______________________________|_________|______________________|__________|
|     |                               |         |                      |          |
| 5   | Emissions                     | CO2     | P                    | Excluded |
|     | from the construction         |_________|                      |__________|
|     | and/or                        |         |                      |          |
|     | installation of               | CH4     |                      | Excluded |
|     | new equipment                 |_________|                      |__________|
|     |                               |         |                      |          |
|     |                               | N2O     |                      | Excluded |
|_____|_______________________________|_________|______________________|__________|        

(5) Calculation method for the GHG emission reductions attributable to the project

The promoter must calculate the quantity of GHG emission reductions attributable to the project using equation 1:

Equation 1

ER = BE - PE

Where:

ER = GHG emission reductions attributable to the project during the project reporting period, in metric tonnes CO2 equivalent;

BE = Emissions under the baseline scenario during the project reporting period, calculated using equation 2, in metric tonnes CO2 equivalent;

PE = Project emissions during the project reporting period, calculated using equation 3, in metric tonnes CO2 equivalent.

(5.1) Calculation method for GHG emissions in the baseline scenario

The promoter must calculate GHG emissions in the baseline scenario using equation 2:

Equation 2

Where:

BE = Baseline scenario emissions during the project reporting period, in metric tonnes CO2 equivalent;

n = Number of time intervals during the project reporting period;

t = Time interval shown in the table in Figure 6.1 for which flow and content measurements of ventilation air CH4 are aggregated;

VAEt = Volume of ventilation air sent to destruction device during time interval t, in cubic metres at standard conditions;

CCH4,t = Average CH4 content in ventilation air before entering destruction device during time interval t, in cubic metres of CH4 per cubic metre of ventilation air;

0.667 = Density of CH4, in kilograms of CH4 per cubic metre of CH4 at standard conditions;

0.001 = Conversion factor, kilograms to metric tonnes;

21 = Global Warming Potential factor of CH4.

If a mass flow meter is used to monitor gas flow instead of a volumetric flow meter, the volume and density terms must be replaced by the monitored mass value in kilograms. The CH4 content must be in mass percent.

(5.2) Calculation method for GHG project emissions

The promoter must calculate the GHG project emissions using equations 3 to 7:

Equation 3

PE = FFCO2 + DMCO2 + UMCH4

Where:

PE = Project emissions during a project reporting period, in metric tonnes CO2 equivalent;

FFCO2 = Total CO2 attributable to the consumption of fossil fuel to capture and destroy ventilation air CH4 during a project reporting period, calculated using equation 4, in metric tonnes CO2 equivalent;

DMCO2 = Total CO2 attributable to the destruction of CH4 during a project reporting period, calculated using equation 6, in metric tonnes CO2 equivalent;

UMCH4 = CH4 emissions attributable to uncombusted CH4 during a project reporting period, calculated using equation 7, in metric tonnes CO2 equivalent;

Equation 4

Where:

FFCO2 = Total CO2 attributable to the consumption of fossil fuel to capture and destroy ventilation air CH4 during a project reporting period, in metric tonnes CO2 equivalent;

n = Number of types of fossil fuel;

j = Type of fossil fuel;

FFPR,j = Annual quantity of fossil fuel j consumed, expressed

— in kilograms, in the case of fuels whose quantity is expressed as a mass;

— in cubic metres at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in litres, in the case of fuels whose quantity is expressed as a volume of liquid;

EFFF,j = CO2 emission factor for fossil fuel j specified in tables 1-3 to 1-8 of QC.1.7 in Schedule A.2 to the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15), expressed

— in kilograms of CO2 per kilogram, in the case of fuels whose quantity is expressed as a mass;

— in kilograms of CO2 per cubic metre at standard conditions, in the case of fuels whose quantity is expressed as a volume of gas;

— in kilograms of CO2 per litre, in the case of fuels whose quantity is expressed as a volume of liquid;

1,000 = Conversion factor, metric tonnes to kilograms;

If the volume of ventilation air leaving the destruction device is not measured as specified in Figure 6.1, it must be calculated using equation 5:

Equation 5

VAS = VAE + CA

Where:

VAS = Volume of ventilation air leaving the destruction device during the project reporting period, in cubic metres at standard conditions;

VAE = Volume of ventilation air sent to a destruction device during the project reporting period, in cubic metres at standard conditions;

CA = Volume of cooling air added after the point of metering for the volume of ventilation air sent to the destruction device (VAE), in cubic metres at standard conditions, or a value of 0 if no cooling air is added;

Equation 6

DMCO2 = [(VAE × CCH4) - (VAS × Cdest-CH4)] × 1.556 × 0.001

Where:

DMCO2 = Total CO2 attributable to the destruction of CH4 during a project reporting period, in metric tonnes CO2 equivalent;

VAE = Volume of ventilation air sent to a destruction device during the project reporting period, in cubic metres at standard conditions;

VAS = Volume of ventilation air leaving the destruction device during the project reporting period, in cubic metres at standard conditions;

CCH4 = Average CH4 content in ventilation air before entering destruction device during the project reporting period, in cubic metres of CH4 per cubic metre of gas;

Cdest-CH4 = Average CH4 content in ventilation air leaving the destruction device during the project reporting period, in cubic metres of CH4 per cubic metre of gas;

1.556 = CO2 emission factor attributable to the combustion of CH4, in kilograms of CO2 per cubic metre of CH4 combusted;

0.001 = Conversion factor, kilograms to metric tonnes;

Equation 7

UMCH4 = VAS × Tdest-CH4 × 0.667 × 0.001 × 21

Where:

UMCH4 = CH4 emissions attributable to uncombusted CH4 during a project reporting period, in metric tonnes CO2 equivalent;

VAS = Volume of ventilation air leaving the destruction device during the project reporting period, in cubic metres at standard conditions;

Tdest-CH4 = Average CH4 content in ventilation air leaving the destruction device during the project reporting period, in cubic metres of CH4 per cubic metre of gas;

0.667 = Density of CH4, in kilograms of CH4 per cubic metre of CH4 at standard conditions;

0.001 = Conversion factor, kilograms to metric tonnes;

21 = Global Warming Potential factor of CH4.

If a mass flow meter is used to monitor gas flow instead of a volumetric flow meter, the volume and density terms must be replaced by the monitored mass value in kilograms. The CH4 content must be in mass percent.

(6) Project surveillance

(6.1) Data collection

The promoter is responsible for collecting the information required for project monitoring.

The promoter must show that the data collected are actual and that rigorous supervision and record-keeping procedures are applied at the project site.

(6.2) Surveillance plan

The promoter must establish a surveillance plan to measure and monitor project parameters in accordance with Figure 6.1:

Figure 6.1. Project surveillance plan

 __________________________________________________________________________________
|                    |            |            |                |                  |
| Parameter          | Factor     | Unit of    | Method         | Frequency of     |
|                    | used in    | measurement|                | measurement      |
|                    | equations  |            |                |                  |
|                    |            |            |                |                  |
|                    |            |            |                |                  |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| Operating status   | N/A        | Degree     | Measured for   | Hourly           |
| of destruction     |            | Celsius or | each           |                  |
| device             |            | other,     | destruction    |                  |
|                    |            | depending  | device         |                  |
|                    |            | on the     |                |                  |
|                    |            | device     |                |                  |
|                    |            | installed  |                |                  |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| Volume of          | VAE        | Cubic metre| Measured       | Continuous       |
| ventilation air    |            | at standard| and            | and recorded     |
| sent to            |            | conditions | calculated     | at least every   |
| destruction        |            |            |                | 2 minutes to     |
| device             |            |            |                | calculate an     |
|                    |            |            |                | hourly           |
|                    |            |            |                | average,         |
|                    |            |            |                | adjusted for     |
|                    |            |            |                | temperature      |
|                    |            |            |                | and pressure     |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| Volume of          | CA         | Cubic metre| Measured       | Continuous       |
| cooling air added  |            | at standard| and            | and recorded     |
|                    |            | conditions | calculated     | at least every   |
|                    |            |            |                | 2 minutes to     |
|                    |            |            |                | calculate an     |
|                    |            |            |                | hourly           |
|                    |            |            |                | average,         |
|                    |            |            |                | adjusted for     |
|                    |            |            |                | temperature      |
|                    |            |            |                | and pressure     |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| Volume of          | VAS        | Cubic metre| Measured or    | Continuous       |
| ventilation air    |            | at standard| calculated     | and recorded     |
| leaving the        |            | conditions |                | at least every   |
| destruction        |            |            |                | 2 minutes to     |
| device             |            |            |                | calculate an     |
|                    |            |            |                | hourly           |
|                    |            |            |                | average,         |
|                    |            |            |                | adjusted for     |
|                    |            |            |                | temperature      |
|                    |            |            |                | and pressure     |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| CH4 content in     | CCH4        | Cubic metre| Measured       | Continuous       |
| ventilation air    |            | of CH4 per |                | and recorded     |
| sent to            |            | cubic metre|                | at least every   |
| destruction        |            | of gas at  |                | 2 minutes to     |
| device during      |            | standard   |                | calculate an     |
| each project       |            | conditions |                | hourly average   |
| reporting period   |            |            |                |                  |
|                    |            |            |                |                  |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| CH4 content in     | CDest-CH4     | Cubic metre| Measured       | Continuous       |
| ventilation air    |            | of CH4 per |                | and recorded     |
| leaving the        |            | cubic metre|                | at least every   |
| destruction        |            | of gas at  |                | 2 minutes to     |
| device during      |            | standard   |                | calculate an     |
| each project       |            | conditions |                | hourly average   |
| reporting period   |            |            |                |                  |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| Total quantity of  | FFPR, j      | Kilogram   | Calculated     | At each         |
| fossil fuels       |            | (solid)    | using fossil   | reporting        |
| consumed by        |            |            | fuel           | period           |
| equipment to       |            | Cubic metre| purchasing     |                  |
| capture and        |            | at standard| register       |                  |
| destroy            |            | conditions |                |                  |
| ventilation air    |            |   (gas)    |                |                  |
| CH4 during a       |            |            |                |                  |
| project reporting  |            |  Litre     |                |                  |
| period, by type of |            | (liquid)   |                |                  |
| fuel j             |            |            |                |                  |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| Temperature of     | T          | °C         | Measured       | Hourly           |
| ventilation air    |            |            |                |                  |
|____________________|____________|____________|________________|__________________|
|                    |            |            |                |                  |
| Pressure of        | P          | kPa        | Measured       | Hourly           |
| ventilation air    |            |            |                |                  |
|____________________|____________|____________|________________|__________________|        

The surveillance plan must

(1) specify the methods used to collect and record the data required for all the relevant parameters in the table in Figure 6.1;

(2) specify

(a) the frequency of data acquisition;

(b) the frequency of instrument cleaning, inspection and calibration activities, and of the verification of instrument calibration accuracy; and

(c) the role of the person responsible for each monitoring activity, as well as the quality assurance and quality control measures taken to ensure that data acquisition and instrument calibration are carried out consistently and with precision;

(3) contain a detailed diagram of the ventilation air capture and destruction system, including the placement of all measurement instruments and equipment that affect included SSRs.

The promoter is responsible for carrying out and monitoring project performance. The promoter must use the destruction device for ventilation air CH4 and the measurement instruments in accordance with the manufacturer’s specifications. The promoter must, in particular, use measurement instruments to measure directly

(1) the flow of ventilation air sent to each destruction device, continuously, recorded every 2 minutes and totalized as an hourly average adjusted for temperature and pressure;

(2) the CH4 content of ventilation air sent to each destruction device, continuously, recorded every 2 minutes and totalized as an hourly average.

When temperature and pressure must be measured to correct flow values at standard conditions, the parameters must be measured at least hourly.

The operating status of destruction device of ventilation air must be monitored and recorded at least hourly.

For every destruction device, the promoter must show in the first project report that a monitoring device has been installed to verify the operation of each destruction device. The promoter must also show in each project report that the monitoring device has operated correctly.

GHG emission reductions will not be taken into account for the issue of offset credits for periods during which the destruction device or the monitoring device for the operation of the destruction device is not operating.

(6.3) Measurement instruments

The promoter must ensure that all ventilation gas flow meters and CH4 analyzers are

(1) cleaned and inspected as specified in the project’s surveillance plan and at the minimum cleaning and inspection frequency specified by the manufacturer, with all cleaning and inspection activities documented by personnel;

(2) not more than 2 months before or after the project reporting period end date, either

(a) checked for calibration accuracy by a qualified and independent person, using a portable instrument, such as a pitot tube, or the manufacturer’s specifications, and ensure that the percentage drift is recorded. The CH4 analyzer must be checked using gas with a CH4 content of less than 2%;

(b) calibrated by the manufacturer or by a third person certified for that purpose by the manufacturer; and

(3) calibrated by the manufacturer or by a third person certified for that purpose by the manufacturer, according to the manufacturer’s specifications or every 5 years, whichever is more frequent.

A calibration certificate or a verification report on calibration accuracy must be produced and included in the project report. The verification provided for in section 70.16 of this Regulation must include confirmation that the person is qualified to verify calibration accuracy.

Flow meter calibrations must be documented to show that the meter was calibrated to a range of flow rates corresponding to the flow rates expected for the ventilation system.

CH4 analyzer calibrations must be documented to show that the calibration was carried out to a range of temperature, pressure and content conditions corresponding to the range of conditions measured for the mine.

The verification of flow meter and analyzer calibration accuracy must show that the instrument provides a reading of volumetric flow or CH4 content that is within a +/-5% accuracy threshold.

When a verification of the calibration accuracy of a device shows a shift outside the +/-5% accuracy threshold, the device must be calibrated by the manufacturer or by a third person certified for that purpose by the manufacturer. In addition, for the entire period from the last calibration that confirmed accuracy within the ± 5% threshold until such time as the piece of equipment is correctly calibrated, the promoter must use the more conservative of

(1) the measured values without correction;

(2) the adjusted values based on the greatest calibration drift recorded at the time of calibration.

The last calibration confirming accuracy within the ± 5% threshold must not have taken place more than 2 months before the end date for the project reporting period.

No offset credit may be issued for a project reporting period when the calibration or verification of the calibration accuracy of the required instruments has not been correctly carried out and documented.

(6.4) Data management

Information on data procedures and data monitoring must be managed in a way that guarantees the integrity, exhaustiveness, accuracy and validity of the data.

The promoter must keep the following documents and information:

(1) the information required under the surveillance plan;

(2) information on each flow meter, CH4 analyzer and destruction device used, including type, their model number, serial number and manufacturer’s maintenance and calibration procedures;

(3) the calibration date, time and results for CH4 analyzers and flow meters, and the corrective measures applied if a piece of equipment fails to meet the requirements of this Regulation;

(4) the maintenance records for capture, destruction and monitoring systems;

(5) operating records showing annual coal production.

(6.5) Missing data – replacement methods

In situations where data on flow rates or CH4 content are missing, the promoter must apply the data replacement methods set out in Part II.

Part II

Missing data – replacement methods

The replacement methods below may be used only

(1) for missing ventilation gas flow rate or CH4 content parameters;

(2) for missing data that are discrete, non-chronic and due to unforeseen circumstances;

(3) when the proper functioning of the destruction device can be shown by thermocouple readings or other devices of the same nature;

(4) to replace data on ventilation gas flow rates when it is shown that CH4 content was consistent with normal operations for the time when the data are missing; and

(5) to replace data on CH4 content when it is shown that the ventilation gas flow rate was consistent with normal operations for the time when the data are missing.

No offset credit may be issued for periods when the replacement methods cannot be used.

 __________________________________________________________________________________
|                                      |                                           |
| Missing data period                  | Replacement method                        |
|______________________________________|___________________________________________|
|                                      |                                           |
| Less than 6 hours                    | Use the average of the 4 hours            |
|                                      | immediately before and following the      |
|                                      | missing data period                       |
|______________________________________|___________________________________________|
|                                      |                                           |
| 6 to less than 24 hours              | Use the 90% upper or lower                |
|                                      | confidence limit of the 24 hours prior to |
|                                      | and after the missing data period,        |
|                                      | whichever results in greater              |
|                                      | conservativeness                          |
|______________________________________|___________________________________________|
|                                      |                                           |
| 1 to 7 days                          | Use the 95% upper or lower                |
|                                      | confidence limit of the 72 hours prior to |
|                                      | and after the missing data period,        |
|                                      | whichever results in greater              |
|                                      | conservativeness                          |
|______________________________________|___________________________________________|
|                                      |                                           |
| More than 7 days                     | No data may be replaced and no            |
|                                      | reduction may be credited                 |
|                                      |                                           |
|______________________________________|___________________________________________|        

O.C. 1184-2012, s. 52; O.C. 1138-2013, s. 29; O.C. 902-2014, ss. 66, 67 and 68; O.C. 1089-2015, s. 31.

TRANSITIONAL

2014

(O.C. 902-2014) SECTION 69. Every natural person who, on 22 October 2014, obtained, in accordance with section 10 of the Regulation respecting a cap-and-trade system for greenhouse gas emission allowances (chapter Q-2, r. 46.1), an identifier to have access to the electronic system must send the Minister, not later than 21 November 2014, the declaration provided for in subparagraph a.1 of subparagraph 7 of that section, as inserted by subparagraph 2 of section 8 of this Regulation.

SECTION 70. The first paragraph of section 19 of the Regulation respecting a cap-and-trade system for greenhouse gas emission allowances, as amended by paragraphs 1 and 2 of section 14 of this Regulation, also applies to any emitter operating an establishment that permanently ceases the production of a reference unit prior to 1 January 2014 and for which the emissions attributable to its other activities were below the emissions threshold for the 3 preceding years. The emitter is required to cover its emissions only until 31 December 2013.

SECTION 71. The provisions of Chapter IV of Title III and the protocols in Appendix D concerning the project plan and its validation, as they read on 21 October 2014, continue to apply to any offset credit project for which an application for registration was submitted not later than that date, up to the date on which the project ends.

2012

(O.C. 1184-2012) SECTION 53. Every person or municipality that, before 19 December 2012, registered with the Minister as an emitter or participant or was designated as an account representative, alternate account representative or electronic submission agent must, not later than 17 February 2013, send the Minister an update of the information and documents submitted with the registration or designation, in order to comply with the requirements in sections 7 to 13 of the Regulation respecting a cap-and-trade system for greenhouse gas emission allowance (chapter Q-2, r. 46.1), as amended by sections 7 to 10 of this Regulation.

Once the information and documents have been updated in accordance with the first paragraph, every person who, on 19 December 2012, was designated an alternate account representative is deemed to be an account representative, and every person who, prior to that date, was designated as an electronic submission agent is deemed to be an account viewing agent.

A person who fails to send the Minister the information and documents required under the first paragraph within the time indicated will be refused access to the electronic system.

REFERENCES

O.C. 1297-2011, 2011 G.O. 2, 3655B

O.C. 1184-2012, 2012 G.O. 2, 3485

O.C. 1137-2013, 2013 G.O. 2, 3200

O.C. 1138-2013, 2013 G.O. 2, 3200

O.C. 1181-2013, 2013 G.O. 2, 3389

O.C. 902-2014, 2014 G.O. 2, 2387

O.C. 1089-2015, 2015 G.O. 2, 3280

S.Q. 2016, c. 7, s. 183

S.Q. 2017, c. 4, ss. 265 and 266