§ 145.355. Compliance.

 (a)  Allowances available for compliance deduction. The CO₂ allowances are available to be deducted for compliance with the CO₂ requirements under §  145.306(c) (relating to standard requirements) for a control period or an interim control period only if the CO₂ allowances meet the following:

   (1)  The CO₂ allowances, other than CO₂ offset allowances, are allocated for a prior control period, the same control period or the interim control period for which the allowances will be deducted.

   (2)  The CO₂ allowances are held in the CO₂ budget source’s compliance account as of the CO₂ allowance transfer deadline for that control period or the interim control period or are transferred into the compliance account by a CO₂ allowance transfer correctly submitted for recordation under §  145.361 (relating to submission of CO₂ allowance transfers) by the CO₂ allowance transfer deadline for that control period or the interim control period.

   (3)  For CO₂ offset allowances, the number of CO₂ offset allowances available to be deducted for a CO₂ budget source to comply with the CO₂ requirements under §  145.306(c) for a control period or an interim control period may not exceed 3.3% of the CO₂ budget source’s CO₂ emissions for that control period or 3.3% of 0.50 times the CO₂ budget source’s CO₂ emissions for an interim control period, as determined in accordance with § §  145.351—145.358 (relating to CO₂ allowance tracking system) and 145.371—145.377 (relating to monitoring, reporting and recordkeeping requirements).

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

 (b)  Deductions for compliance. Following the recordation, in accordance with §  145.362 (relating to recordation), of CO₂ allowance transfers submitted for recordation in the CO₂ budget source’s compliance account by the CO₂ allowance transfer deadline for a control period or interim control period, the Department or its agent will deduct CO₂ allowances available under subsection (a) to cover the source’s CO₂ emissions for the control period or interim control period, as follows:

   (1)  Until the amount of CO₂ allowances deducted equals the number of tons of total CO₂ emissions, or 0.50 times the number of tons of total CO₂ emissions for an interim control period, less any CO₂ emissions attributable to the burning of eligible biomass, determined in accordance with § §  145.371—145.377, from all CO₂ budget units at the CO₂ budget source for the control period or interim control period.

   (2)  Until there are no more CO₂ allowances remaining in the compliance account that are available to be deducted under subsection (a), if there are insufficient CO₂ allowances to complete the deductions in paragraph (1).

 (c)  Allowance identification.

   (1)  The CO₂ authorized account representative for a CO₂ budget source’s compliance account may identify by serial number the CO₂ allowances to be deducted from the compliance account for emissions or excess emissions for a control period or an interim control period in accordance with subsection (b) or subsection (d). The identification shall be made in the compliance certification report submitted in accordance with §  145.331 (relating to compliance certification report).

   (2)  The Department or its agent will deduct CO₂ allowances for a control period or an interim control period from the CO₂ budget source’s compliance account, in the absence of an identification or in the case of a partial identification of available CO₂ allowances by serial number under paragraph (1), in the following order:

     (i)   CO₂ offset allowances subject to the relevant compliance deduction limitations under subsection (a)(3) will be deducted in chronological order. In the event that some, but not all, CO₂ offset allowances from a particular allocation year are to be deducted, CO₂ offset allowances will be deducted by serial number, with lower serial number allowances deducted before higher serial number allowances.

     (ii)   CO₂ allowances, other than CO₂ offset allowances, that are available for deduction under subsection (a) will be deducted in chronological order. In the event that some, but not all, CO₂ allowances from a particular allocation year are to be deducted, CO₂ allowances will be deducted by serial number, with lower serial number allowances deducted before higher serial number allowances.

 (d)  Deductions for excess emissions.

   (1)  After making the deductions for compliance under subsection (b), the Department or its agent will deduct from the CO₂ budget source’s compliance account a number of CO₂ allowances, equal to 3 times the number of the CO₂ budget source’s excess emissions.

   (2)  If the compliance account does not contain sufficient CO₂ allowances to cover 3 times the number of the CO₂ budget source’s excess emissions, the CO₂ budget source shall immediately transfer CO₂ allowances into its compliance account in an amount equal to 3 times the number of the CO₂ budget source’s excess emissions. No CO₂ offset allowances may be deducted to account for the source’s excess emissions.

   (3)  A CO₂ allowance deduction required under paragraph (1) will not affect the liability of the owner or operator of the CO₂ budget source or the CO₂ budget units at the source for any fine, penalty or assessment, or their obligation to comply with any other remedy, for the same violation, as ordered under the Clean Air Act or the act. The following guidelines will be followed by the Department in assessing fines, penalties or other obligations:

     (i)   For purposes of determining the number of days of violation, if a CO₂ budget source has excess emissions for a control period or an interim control period, each day in the control period or an interim control period constitutes a day of violation unless the owner or operator of the unit demonstrates that a lesser number of days should be considered.

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

 (e)  Recordation. The Department or its agent will record in the appropriate compliance account all deductions from the account under subsections (b)—(d).

 (f)  Action by the Department on submissions.

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

   (2)  The Department may deduct CO₂ allowances from or transfer CO₂ allowances to a CO₂ budget source’s compliance account based on information in the submissions, as adjusted under paragraph (1).

Cross References

   This section cited in 25 Pa. Code §  145.302 (relating to definitions); 25 Pa. Code §  145.306 (relating to standard requirements); 25 Pa. Code §  145.323 (relating to contents of an application for a permit incorporating CO₂ Budget Trading Program requirements); 25 Pa. Code §  145.331 (relating to compliance certification report); 25 Pa. Code §  145.342 (relating to CO₂ allowance allocations); 25 Pa. Code §  145.351 (relating to CO₂ Allowance Tracking System (COATS) accounts); 25 Pa. Code §  145.356 (relating to banking); 25 Pa. Code §  145.362 (relating to recordation); and 25 Pa. Code §  145.391 (relating to purpose).

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