7 Del. Admin. Code § 1147-1.0

Current through Register Vol. 28, No. 1, July 1, 2024

Section 1147-1.0 - CO[2] Budget Trading Program General Provisions

1.1 Purpose

This Regulation establishes the State of Delaware component of the CO₂ Budget Trading Program, which is designed to stabilize and then reduce anthropogenic emissions of CO₂, a greenhouse gas, from CO₂ budget sources in an economically efficient manner.

1.2 Applicability.

1.2.1Units. Any unit that, at any time on or after January 1, 2005, serves an electricity generator with a nameplate capacity equal to or greater than 25 MWe shall be a CO₂ budget unit and any source that includes one or more such units shall be a CO₂ budget source, subject to the requirements.

1.2.2Limited exemption for units with electrical output to the electric grid restricted by permit conditions.

1.2.2.1Applicability. Notwithstanding subsection 1.2.1, a unit under subsection 1.2.1 that is covered by a permit issued pursuant to 7 DE Admin Code 1102 or 1130 containing a practically enforceable condition restricting the supply of the unit's annual electrical output to the electric grid to less than or equal to 10 percent of the annual gross generation of the unit, and which complies with the provisions in subsection 1.2.2.3, shall be exempt from the requirements of Regulation 1147, except for subsections 1.3, 1.4, and 1.6.

1.2.2.2Effective date. The exemption under subsection 1.2.2.1 shall become effective as of the January 1 that is on or after the date on which the restriction on the percentage of annual gross generation that may be supplied to the electric grid and the provisions in the permit required under subsection 1.2.2.1 become final.

1.2.2.3Compliance.

1.2.2.3.1 A unit exempt under subsection 1.2.2.1 shall comply with the restriction on percentage of annual gross generation that may be supplied to the electric grid described in subsection 1.2.2.1.

1.2.2.3.2 A unit exempt under subsection 1.2.2.1 shall report to the Department the amount of annual gross generation and the amount of annual gross generation supplied to the electric grid during the year by the following February 1.

1.2.2.3.3 For a period of 10 years from the date the records are created, the owners and operators of a unit exempt under subsection 1.2.2.1 shall retain, at the source that includes the unit, records demonstrating that the conditions of the permit under subsection 1.2.2.1 were met. The 10-year period for keeping records may be extended for cause, at any time prior to the end of the period, in writing by the Department. The owners and operators bear the burden of proof that the unit met the restriction on the percentage of annual gross generation that may be supplied to the electric grid.

1.2.2.3.4 The owners and operators and, to the extent applicable, the CO₂ authorized account representative of a unit exempt under subsection 1.2.2.1 shall comply with all the requirements concerning all time periods for which the exemption is not in effect, even if such requirements arise, or must be complied with, after the exemption takes effect.

1.2.2.3.5 On the earlier of the following dates, a unit exempt under subsection 1.2.2.1 shall lose its exemption:

1.2.2.3.5.1 the date on which the restriction on the percentage of annual gross generation that may be supplied to the electric grid described in subsection 1.2.2.1 is removed from the unit's permit or otherwise becomes no longer applicable in any year that commences on or after January 1, 2009; or

1.2.2.3.5.2 the first date on which the unit fails to comply, or on which the owners and operators fail to meet their burden of proving that the unit is complying, with the restriction on the percentage of annual gross generation that may be supplied to the electric grid described in subsection 1.2.2.1 during any year that commences on or after January 1, 2009.

1.2.2.3.6 A unit that loses its exemption in accordance with subsection 1.2.2.3.5 shall be subject to the requirements of Regulation 1147. For the purpose of applying permitting requirements under Section 3.0, and applying monitoring requirements under Section 8.0, the unit shall be treated as commencing operation on the date the unit loses its exemption.

1.2.3 Requirements for any CO2 Budget Source that is a petroleum refinery.

1.2.3.1 Applicability. Notwithstanding subsection 1.2.1, a CO2 budget source under subsection 1.2.1 that is a petroleum refinery may elect to participate in the CO2 budget trading program by securing a permit issued pursuant to 7 DE Admin. Code 1102 or 1130 that contains practically enforceable conditions that require compliance with all of the provisions, except "CO2 budget emissions limitation" shall mean for a CO2 budget source, the tonnage equivalent, in CO2 emissions associated with the gross electrical generation output to the electric grid in a control period from all CO2 Budget Units at the CO2 Budget Source, of the CO2 allowances available for compliance deduction for the source for a control period; and the amount of CO₂ allowances required to be held pursuant to subsection 1.5.3.1, and deducted pursuant to subsection 6.5.2.1 shall include only the number of tons of total CO₂ emissions associated with gross generation output to the electric grid.

1.2.3.2 Effective date. The requirements of subsection 1.2.3.1 shall become effective as of January 1 of the year that the permit required under subsection 1.2.3.1 becomes final.

1.2.3.3 Compliance. For the purpose of applying permitting requirements under Section 3.0, and applying monitoring requirements under Section 8.0, the unit shall be treated as commencing operation on the date the permit required under subsection 1.2.3.1 becomes final.

1.3 Definitions.

The following terms, when used in this regulation, shall have the following meanings unless the context clearly indicates otherwise. Terms used but not defined herein shall have the meanings given them in 7 DE Admin Code 1101 or the Clean Air Act as amended in 1990, in that order of:

"Account number" means the identification number given by the Department or its agent to each CO₂ Allowance Tracking System account.

"Acid rain emissions limitation" means as defined in 40 CFR 72.2, a limitation on emissions of sulfur dioxide or nitrogen oxides under the Acid Rain Program under title IV of the Clean Air Act.

"Acid Rain Program" means a multi-state sulfur dioxide and nitrogen oxides air pollution control and emission reduction program established by the Administrator under title IV of the CAA and 40 CFR 72 through 78.

"Administrator" means the Administrator or the United States Environmental Protection Agency or the Administrator's authorized representative.

"Allocate or allocation" means the determination by the Department of the number of CO₂ allowances to be recorded in the compliance account of a CO₂ budget unit, an allocation set-aside account, the consumer benefit or strategic energy purpose account, or the general account of the sponsor of an approved CO₂ emissions offset project.

"Allocation year" means a calendar year for which the Department allocates or awards CO₂ allowances pursuant to Sections 5.0 and 10.0. The allocation year of each CO₂ allowance is reflected in the unique identification number given to the allowance pursuant to subsection 6.4.5.

"Allowance auction or auction" means an auction in which the Department offers CO₂ allowances for sale.

"Anaerobic digester" means a device that promotes the decomposition of organic material to simple organics and gaseous biogas products, usually accomplished by means of controlling temperature and volume, and including a methane recovery system.

"Anaerobic digestion" means the degradation of organic material including manure brought about through the action of microorganisms in the absence of elemental oxygen.

"Anaerobic storage" means storage of organic material in an oxygen-free environment, or under oxygen-free conditions, including but not limited to, holding tanks, ponds, and lagoons.

"Ascending Price, Multiple Round Auction" means a multiple round auction starting with an opening price with increases each round by predetermined increments. In each round, bidders offer the quantity they are willing to purchase at the posted price. Rounds continue so long as demand exceeds the quantity offered for sale. At the completion of the final round, allowances may be allocated, subject to subsection 11.5:

(1) At the final price to remaining bidders and withhold unsold allowances for a future auction, or

(2) At the penultimate price, first to final round bidders and then to bidders in the penultimate round in chronological order of bid during the penultimate round for all remaining allowances, or

(3) According to an alternative mechanism designed to effectuate the objectives of this section.

"Attribute" means a characteristic associated with electricity generated using a particular renewable fuel, such as its generation date, facility geographic location, unit vintage, emissions output, fuel, state program eligibility, or other characteristic that can be identified, accounted for, and tracked.

"Attribute credit" means an attribute credit represents the attributes related to one megawatt-hour of electricity generation.

"Automated data acquisition and handling system or DAHS" means that component of the continuous emissions monitoring system, or other emissions monitoring system approved for use under Section 8.0, designed to interpret and convert individual output signals from pollutant concentration monitors, flow monitors, diluent gas monitors, and other component parts of the monitoring system to produce a continuous record of the measured parameters in the measurement units required by Section 8.0.

"Award" means the determination by the Department of the number of CO₂ offset allowances to be recorded in the general account of a project sponsor pursuant to subsection 10.7. Award is a type of allocation.

"Billing meter" means to qualify as a billing meter, the measurement device must be used to measure electric or thermal output for commercial billing under a contract. The facility selling the electric or thermal output must have different owners from the owners of the party purchasing the electric or thermal output.

"Biogas" means a gas resulting from the decomposition of organic matter under anaerobic conditions. The principle constituents are methane and carbon dioxide.

"Cost Containment Reserve trigger price, or CCR trigger price" means the CCR trigger price is also the minimum price at which CO₂ CCR allowances are offered for sale by the Department at auction. The CCR trigger price shall be $4.00 per CO₂ Allowance for calendar year 2014, $6.00 per CO₂ Allowance in calendar year 2015, $8.00 per CO₂ allowance in calendar year 2016, and $10.00 per CO₂ Allowances in calendar year 2017, each calendar year thereafter, the CCR trigger price shall be 1.025 multiplied by the CCR trigger price from the previous calendar year, rounded to the nearest whole cent.

" CO₂ authorized alternate account representative" means for a CO₂ budget source and each CO₂ budget unit at the source, the alternate natural person who is authorized by the owners and operators of the source and all CO₂ budget units at the source, in accordance with Section 2.0, to represent and legally bind each owner and operator in matters pertaining to the CO₂ Budget Trading Program or, for a general account, the alternate natural person who is authorized, under Section 6.0, to transfer or otherwise dispose of CO₂ allowances held in the general account.

If the CO₂ budget source is also subject to the Acid Rain Program, then for a CO₂ Budget Trading Program compliance account, this alternate natural person shall be the same person as the alternate designated representative under the Acid Rain Program.

"CO₂ allowance" means a limited authorization by the Department or a participating state under the CO₂ Budget Trading Program to emit up to one ton of CO₂, subject to all applicable limitations contained in this regulation.

"CO₂ Allowance Auction Website" means the website containing information regarding the auctions to be conducted pursuant to this Regulation. The website shall be available through a link from the Department's main website at http://www.dnrec.delaware.gov/.

"CO₂ allowance deduction or deduct CO₂ allowances" means the permanent withdrawal of CO₂ allowances by the Department or its agent from a CO₂ Allowance Tracking System compliance account to account for the number of tons of CO₂ emitted from a CO₂ budget source for a control period, determined in accordance with Section 8.0, or for the forfeit or retirement of CO₂ allowances as provided by this regulation.

"CO₂ allowance price" means the price for CO₂ allowances in the CO₂ Budget Trading Program for a particular time period as determined by the Department or its agent, calculated based on a volume-weighted average of transaction prices reported to the Department or its agent, and taking into account prices as reported publicly through reputable sources.

"CO₂ allowances held or hold CO₂ allowances" means the CO₂ allowances recorded by the Department or its agent, or submitted to the Department or its agent for recordation, in accordance with Sections 6.0 and 7.0, in a CO₂ Allowance Tracking System account.

"CO₂ Allowance Tracking System (COATS)" means the system by which the Department or its agent records allocations, deductions, and transfers of CO₂ allowances under the CO₂ Budget Trading Program. The tracking system may also be used to track CO₂ emissions offset projects, CO₂ allowance prices and emissions from affected sources.

"CO₂ Allowance Tracking System account" means an account in the CO₂ Allowance Tracking System established by the Department or its agent for purposes of recording the allocation, holding, transferring, or deducting of CO₂ allowances.

"CO₂ allowance transfer deadline" means midnight of the March 1 occurring after the end of the relevant control period and each relevant interim control period, if that March 1 is not a business day, midnight of the first business day thereafter and is the deadline by which CO₂ allowances must be submitted for recordation in a CO₂ budget source's compliance account in order for the source to meet the CO2 requirements of subsection 1.5.3 for the control period and each relevant interim control period immediately preceding such deadline.

"CO₂ authorized account representative" means for a CO₂ budget source and each CO₂ budget unit at the source, the natural person who is authorized by the owners and operators of the source and all CO₂ budget units at the source, in accordance with Section 2.0, to represent and legally bind each owner and operator in matters pertaining to the CO₂ Budget Trading Program or, for a general account, the natural person who is authorized, under Section 6.0, to transfer or otherwise dispose of CO₂ allowances held in the general account.

If the CO₂ budget source is also subject to the Acid Rain Program, then for a CO₂ Budget Trading Program compliance account, this natural person shall be the same person as the authorized account representative under the Acid Rain Program.

"CO₂ budget emissions limitation" means for a CO₂ budget source, the tonnage equivalent, in CO₂ emissions in a control period or an interim control period, of the CO₂ allowances available for compliance deduction for the source for a control period or an interim control period.

"CO₂ budget permit" means the portion of the legally binding permit issued by the Department pursuant to Regulation 1102, 1130 and 1147 to a CO₂ budget source or CO₂ budget unit which specifies the CO₂ Budget Trading Program requirements applicable to the CO₂ budget source, to each CO₂ budget unit at the CO₂ budget source, and to the owners and operators and the CO₂ authorized account representative of the CO₂ budget source and each CO₂ budget unit.

"CO₂ budget source" means a source that includes one or more CO₂ budget units.

"CO₂ Budget Trading Program" means a multi-state CO₂ air pollution control and emissions reduction program established pursuant to this regulation and corresponding regulations in other states as a means of reducing emissions of CO₂ from CO₂ budget sources.

"CO₂ budget unit" means a unit that is subject to the CO₂ Budget Trading Program requirements under subsection 1.2.

"CO₂ cost containment reserve allowance or CO₂ CCR allowance" means a CO₂ allowance that is offered for sale at an auction by the Department for the purpose of containing the cost of CO₂ Allowances. CO₂ CCR allowances offered for sale at an auction are separate from and additional to CO₂ allowances allocated from Delaware's CO₂ Budget Trading Program base and adjusted budgets. CO₂ CCR allowances are subject to all applicable limitations contained in this section.

"CO₂ cost containment reserve trigger price, or CCR trigger price" means the CCR trigger price is the minimum price at which CO2 CCR allowances are offered for sale by the Department or its agent at an auction. The CCR trigger price shall be $10.00 per CO2 allowance in calendar year 2017. Each calendar year thereafter through 2020, the CCR trigger price shall be 1.025 multiplied by the CCR trigger price from the previous calendar year, rounded to the nearest whole cent. The CCR trigger price in calendar year 2021 shall be $13.00. Each calendar year thereafter, the CCR trigger price shall be 1.07 multiplied by the CCR trigger price from the previous calendar year, rounded to the nearest whole cent, as shown in Table 1 below.

Table 1. CO2 CCR Trigger Price
2018	2019	2020	2021	2022	2023	2024	2025	2026	2027	2028	2029	2030
$10.25	$10.51	$10.77	$13.00	$13.91	$14.88	$15.92	$17.03	$18.22	$19.50	$20.87	$22.33	$23.89

"CO₂ emissions containment reserve allowance or CO2 ECR allowance" means a CO2 allowance that is withheld from sale at an auction by the Department for the purpose of additional emission reduction in the event of lower than anticipated emission reduction costs.

"CO₂ emissions containment reserve trigger price, or ECR trigger price" means the ECR trigger price is the price below which CO2 allowances will be withheld from sale by the Department or its agent at an auction. The ECR trigger price in calendar year 2021 shall be $6.00. Each calendar year thereafter, the ECR trigger price shall be 1.07 multiplied by the ECR trigger price from the previous calendar year, rounded to the nearest whole cent, as shown in Table 2.

Table 2. CO2 ECR Trigger Price
2021	2022	2023	2024	2025	2026	2027	2028	2029	2030
$6.00	$6.42	$6.87	$7.35	$7.86	$8.41	$9.00	$9.63	$10.30	$11.02

"CO₂ equivalent" means the quantity of a given greenhouse gas multiplied by its global warming potential (GWP).

"CO₂ offset allowance" means a CO₂ allowance that is awarded to the sponsor of a CO₂ emissions offset project pursuant to subsection 10.7 and is subject to the relevant compliance deduction limitations of subsection 6.5.1.3.

"Combined cycle system" means a system comprised of one or more combustion turbines, heat recovery steam generators, and steam turbines configured to improve overall efficiency of electricity generation or steam production.

"Combustion turbine" means an enclosed fossil or other fuel-fired device that is comprised of a compressor (if applicable), a combustor, and a turbine, and in which the flue gas resulting from the combustion of fuel in the combustor passes through the turbine, rotating the turbine.

"Commence commercial operation" means with regard to a unit that serves a generator, to have begun to produce steam, gas, or other heated medium used to generate electricity for sale or use, including test generation. For a unit that is a CO₂ budget unit under subsection 1.2 on the date the unit commences commercial operation, such date shall remain the unit's date of commencement of commercial operation even if the unit is subsequently modified, reconstructed, or repowered. For a unit that is not a CO₂ budget unit under subsection 1.2 on the date the unit commences commercial operation, the date the unit becomes a CO₂ budget unit under subsection 1.2 shall be the unit's date of commencement of commercial operation.

"Commence operation" means to begin any mechanical, chemical, or electronic process, including, with regard to a unit, start-up of a unit's combustion chamber. For a unit that is a CO₂ budget unit under subsection 1.2 on the date of commencement of operation, such date shall remain the unit's date of commencement of operation even if the unit is subsequently modified, reconstructed, or repowered. For a unit that is not a CO₂ budget unit under subsection 1.2 on the date of commencement of operation, the date the unit becomes a CO₂ budget unit under subsection 1.2 shall be the unit's date of commencement of operation.

"Compliance account" means a CO₂ Allowance Tracking System account, established by the Department or its agent for a CO₂ budget source under Section 6.0 of this regulation, in which the CO₂ allowance allocations for the source are initially recorded and in which are held CO₂ allowances available for use by the source for a control period and each interim control period for the purpose of meeting the CO2 requirements of subsection 1.5.3.

"Conflict of interest" means a situation that may arise with respect to an individual in relation to any specific project sponsor, CO₂ emissions offset project or category of offset projects, such that the individual's other activities or relationships with other persons or organizations render or may render the individual incapable of providing an impartial certification opinion, or otherwise compromise the individual's objectivity in performing certification functions.

"Continuous emissions monitoring system or CEMS" means the equipment required under Section 8.0 to sample, analyze, measure, and provide, by means of readings recorded at least once every 15 minutes (using an automated DAHS), a permanent record of stack gas volumetric flow rate, stack gas moisture content, and oxygen or carbon dioxide concentration (as applicable), in a manner consistent with 40 CFR 75 and Section 8.0. The following systems are types of continuous emissions monitoring systems required under Section 8.0.

(1) A flow monitoring system, consisting of a stack flow rate monitor and an automated data acquisition and handling system and providing a permanent, continuous record of stack gas volumetric flow rate, in standard cubic feet per hour (scfh);

(2) A nitrogen oxides emissions rate (or NO_X -diluent) monitoring system, consisting of a NO_X pollutant concentration monitor, a diluent gas (CO₂ or O₂) monitor, and an automated data acquisition and handling system and providing a permanent, continuous record of NO_X concentration, in parts per million (ppm), diluent gas concentration, in percent CO₂ or O₂; and NO_X emissions rate, in pounds per million British thermal units (lb/MMBtu);

(3) A moisture monitoring system, as defined in 40 CFR 75.11(b)(2) and providing a permanent, continuous record of the stack gas moisture content, in percent H₂O;

(4) A carbon dioxide monitoring system, consisting of a CO₂ pollutant concentration monitor (or an oxygen monitor plus suitable mathematical equations from which the CO₂ concentration is derived) and an automated data acquisition and handling system and providing a permanent, continuous record of CO₂ emissions, in percent CO₂; and

(5) An oxygen monitoring system, consisting of an O₂ concentration monitor and an automated data acquisition and handling system and providing a permanent, continuous record of O₂, in percent O₂.

"Control period" means a three-calendar-year time period. The first control period is from January 1, 2009 to December 31, 2011, inclusive. Each subsequent sequential three-calendar-year period is a separate control period. The first two calendar years of each control period are defined as an interim control period beginning in January 1, 2015.

"Cross State Air Pollution Rule (CSAPR) NOX Annual Trading Program" means a multi-state NO_X air pollution control and emission reduction program established in accordance with subpart AAAAA of 40 CFR Part 97 and 40 CFR 52.38(a) (including such a program that is revised in a SIP revision approved by the Administrator under 40 CFR 52.38(a)(3) or (4) or that is established in a SIP revision approved by the Administrator under 40 CFR 52.38(a)(5)), as a means of mitigating interstate transport of fine particulates and NO_X.

"Cross State Air Pollution Rule (CSAPR) NOX Ozone Season Trading Program" means a multi-state NO_X air pollution control and emission reduction program established in accordance with subpart BBBBB of 40 CFR Part 97 and 40 CFR 52.38(b) (including such a program that is revised in a SIP revision approved by the Administrator under 40 CFR 52.38(b)(3) or (4) or that is established in a SIP revision approved by the Administrator under 40 CFR 52.38(b)(5)), as a means of mitigating interstate transport of ozone and NO_X.

"Cross State Air Pollution Rule (CSAPR) SO2 Group 1 Trading Program" means a multi-state SO₂ air pollution control and emission reduction program established in accordance with subpart CCCCC of 40 CFR Part 97 and 40 CFR 52.39(a), (b), (d) through (f), (j), and (k) (including such a program that is revised in a SIP revision approved by the Administrator under 40 CFR 52.39(d) or (e) or that is established in a SIP revision approved by the Administrator under 40 CFR 52.39(f)), as a means of mitigating interstate transport of fine particulates and SO₂.

"Cross State Air Pollution Rule (CSAPR) SO2 Group 2 Trading Program" means a multi-state SO2 air pollution control and emission reduction program established in accordance with subpart DDDDD of 40 CFR Part 97 and 40 CFR 52.39(a), (c), and (g) through (k) of this chapter (including such a program that is revised in a SIP revision approved by the Administrator under 40 CFR 52.39(g) or (h) of this chapter or that is established in a SIP revision approved by the Administrator under 40 CFR 52.39(i) of this chapter), as a means of mitigating interstate transport of fine particulates and SO₂.

"Cooperating Regulatory Agency" means a regulatory agency in a state or United States jurisdiction that is not a participating state that has entered into a memorandum of understanding with the appropriate regulatory agencies of all participating states to carry out certain obligations relative to CO₂ emissions offset projects in that state or United States jurisdiction, including but not limited to the obligation to perform audits of offset project sites, and report violations.

"Delaware Auction Account" means an account administered by the Department of Natural Resources and Environmental Control or its agent for purposes of auctioning CO₂ allowances.

"Delaware CO₂ Budget Trading Program adjusted budget" means The Delaware CO₂ Budget Trading Program adjusted budget is determined in accordance with subsection 5.3 and is the annual amount of CO₂ tons available in Delaware for allocation in a given allocation year, in accordance with the CO₂ Budget Trading Program. CO₂ offset allowances allocated to project sponsors and CO₂ CCR allowances offered for sale at an auction are separate from and additional to CO₂ allowances allocated from the Delaware CO₂ Budget Trading Program adjusted budget.

"Delaware CO2 Budget Trading Program Base Budget" means the Delaware CO₂ Budget Trading Program base budget is specified in subsection 5.1. CO₂ offset allowances allocated to project sponsors and CO₂ CCR allowances offered for sale at an auction are separate from and additional to CO₂ allowances allocated from Delaware CO₂ Budget Trading Program Base Budget.

"Department" means the State of Delaware Department of Natural Resources and Environmental Control.

"Eligible biomass" means eligible biomass includes sustainably harvested woody and herbaceous fuel sources that are available on a renewable or recurring basis (excluding old-growth timber), including dedicated energy crops and trees, agricultural food and feed crop residues, aquatic plants, unadulterated wood and wood residues, animal wastes, other clean organic wastes not mixed with other solid wastes, biogas, and other neat liquid biofuels derived from such fuel sources. Sustainably harvested will be determined by the Department.

"Excess emissions" means any tonnage of CO₂ emitted by a CO₂ budget source during a control period that exceeds the CO₂ budget emissions limitation for the source.

"Excess interim emission" means any tonnage of CO₂ emitted by a CO₂ budget source during an interim control period multiplied by 0.50 that exceeds the CO₂ budget emissions limitation for the source.

"First control period interim adjustment for banked allowances" means an adjustment applied to the State of Delaware CO₂ Budget Trading Program base budget for allocation years 2014 through 2020 to address the surplus allocation year 2009, 2010, and 2011 allowances held in general and compliance accounts, including compliance accounts established pursuant to the CO₂ Budget Trading Program, but not including accounts opened by participating states.

"Forest offset project" mean an offset project involving reforestation, improved forest management, or avoided conversion.

"Forest offset project data report" means the report prepared by a project sponsor each year that provides the information and documentation required by this Subpart or the forest offset protocol.

"Forest offset protocol" means the protocol titled "Regional Greenhouse Gas Initiative Offset Protocol U.S. Forest Projects", published by the participating states on 02/08/13.

"Fossil fuel" means natural gas, petroleum, coal, or any form of solid, liquid, or gaseous fuel derived from such material.

"Fossil fuel-fired" means:

(1) With regard to a unit that commenced or commences operation prior to January 1, 2005, the combustion of fossil fuel, alone or in combination with any other fuel, where the fossil fuel combusted comprises, or is projected to comprise, more than 50 percent of the annual heat input on a Btu basis during any year.

(2) With regard to a unit that commences operation on or after January 1, 2005, the combustion of fossil fuel, alone or in combination with any other fuel, where the fossil fuel combusted comprises, or is projected to comprise, more than 5 percent of the annual heat input on a Btu basis during any year.

"General account" means a CO₂ Allowance Tracking System account, established under Section 6.0, that is not a compliance account.

"Global warming potential (GWP)" means a measure of the radiative efficiency (heat-absorbing ability) of a particular gas relative to that of carbon dioxide (CO₂) after taking into account the decay rate of each gas (the amount removed from the atmosphere over a given number of years) relative to that of CO₂. Global warming potentials used in this Regulation are consistent with the values used in the Intergovernmental Panel on Climate Change, Fifth Assessment Report.

"Gross generation" means the electrical output (in MWe) at the terminals of the generator.

"Independent verifier" means an individual that has been approved by the Department or its agent to conduct verification activities.

"Intentional Reversal" means any reversal caused by a forest owner's negligence, gross negligence, or willful intent, including harvesting, development, and harm to the area within the offset project boundary.

"Interim control period" means an interim control period is a one-calendar-year time period, during each of the first and second calendar years of each three year control period. The first interim control period starts on January 1, 2015 and ends on December 31, 2015, inclusive. The second interim control period starts on January 1, 2016 and ends on December 31, 2016, inclusive. Each successive three year control period will have two interim control periods, comprised of each of the first two calendar years of that control period.

"Life-of-the-unit contractual arrangement" means a unit participation power sales agreement under which a customer reserves, or is entitled to receive, a specified amount or percentage of nameplate capacity and/or associated energy from any specified unit pursuant to a contract:

(1) For the life of the unit;

(2) For a cumulative term of no less than 30 years, including contracts that permit an election for early termination; or

(3) For a period equal to or greater than 25 years or 70 percent of the economic useful life of the unit determined as of the time the unit is built, with option rights to purchase or release some portion of the nameplate capacity and associated energy generated by the unit at the end of the period.

"Market penetration rate" means a measure of the diffusion of a technology, product, or practice in a defined market, as represented by the percentage of annual sales for a product or practice, or as a percentage of the existing installed stock for a product or category of products, or as the percentage of existing installed stock that utilizes a practice. The Department may determine an appropriate market definition and market penetration metric for a category of technology, product or practice, and may issue guidance specifying the technologies, products or practices that meet a specified market penetration rate.

"Maximum potential hourly heat input" means an hourly heat input used for reporting purposes when a unit lacks certified monitors to report heat input. If the unit intends to use appendix D of 40 CFR 75 to report heat input, this value should be calculated, in accordance with 40 CFR 75, using the maximum fuel flow rate and the maximum gross calorific value. If the unit intends to use a flow monitor and a diluent gas monitor, this value should be reported, in accordance with 40 CFR 75, using the maximum potential flow rate and either the maximum carbon dioxide concentration (in percent CO₂) or the minimum oxygen concentration (in percent O₂).

"Minimum reserve price" means the minimum reserve price in calendar year 2014 shall be $2.00. Each calendar year thereafter the minimum reserve price shall be 1.025 multiplied by the minimum reserve price from the previous calendar year, rounded to the nearest whole cent.

"Monitoring system" means any monitoring system that meets the requirements of Section 8.0, including continuous emissions monitoring system, an accepted monitoring system, or an alternative monitoring system.

"Nameplate capacity" means the maximum electrical output (in MWe) that a generator can sustain over a specified period of time when not restricted by seasonal or other de-ratings as measured in accordance with the United States Department of Energy standards.

" Net-electric output" means the amount of gross generation the generator(s) produce (including, but not limited to, output from steam turbine(s), combustion turbine(s), and gas expander(s)), as measured at the generator terminals, less the electricity used to operate the plant (i.e., auxiliary loads); such uses include fuel handling equipment, pumps, fans, pollution control equipment, other electricity needs, and transformer losses as measured at the transmission side of the step up transformer (e.g., the point of sale).

" Non-CO₂ budget unit" means a unit that does not meet the applicability criteria of subsection 1.2.

"Offset project" means an offset project includes all equipment, materials, items, or actions directly related to the reduction of CO₂ equivalent emissions or the sequestration of carbon specified in a consistency application submitted pursuant to subsection 10.4. Equipment, materials, items, or actions unrelated to an offset project reduction of CO₂ equivalent emissions or the sequestration of carbon, but occurring at a location where an offset project occurs, shall not be considered part of an offset project, unless specified at subsection 10.5.

"Operator" means any person who operates, controls, or supervises a CO₂ budget unit or a CO₂ budget source and shall include, but not be limited to, any holding company, utility system, or plant manager of such a unit or source.

"Owner" means any of the following persons:

(1) Any holder of any portion of the legal or equitable title in a CO₂ budget unit; or

(2) Any holder of a leasehold interest in a CO₂ budget unit, other than a passive lessor, or a person who has an equitable interest through such lessor, whose rental payments are not based, either directly or indirectly, upon the revenues or income from the CO₂ budget unit; or

(3) Any purchaser of power from a CO₂ budget unit under a life-of-the-unit contractual arrangement in which the purchaser controls the dispatch of the unit; or

(4) With respect to any general account, any person who has an ownership interest with respect to the CO₂ allowances held in the general account and who is subject to the binding agreement for the CO₂ authorized account representative to represent that person's ownership interest with respect to the CO₂ allowances.

" Participating state" means a state that has established a corresponding regulation as part of the CO₂ Budget Trading Program.

"Project commencement" means for an offset project involving physical construction, other work at an offset project site, or installation of equipment or materials, the date of the beginning of such activity. For an offset project that involves the implementation of a management activity or protocol, the date on which such activity is first implemented or such protocol first utilized. For an offset project involving reforestation, improved forest management, or avoided conversion, the date specified in subsection 3.2 of the forest offset protocol.

"Public Benefit Purpose" shall mean purposes including the promotion of energy efficiency, the mitigation of electricity ratepayer impacts attributable to RGGI, the promotion of distributed renewable or non-carbon-emitting energy technologies, the stimulation and reward of investment in the development of innovative carbon emissions abatement technologies with significant carbon reduction potential, and funding of the administration of the Program established by Title 7, Chapter 60.

"Receive or receipt of" means when referring to the Department or its agent, to come into possession of a document, information, or correspondence (whether sent in writing or by authorized electronic transmission), as indicated in an official correspondence log, or by a notation made on the document, information, or correspondence, by the Department or its agent in the regular course of business.

"Recordation, record, or recorded" means with regard to CO₂ allowances, the movement of CO₂ allowances by the Department or its agent from one CO₂ Allowance Tracking System account to another, for purposes of allocation, transfer, or deduction.

"Regional-type anaerobic digester" means an anaerobic digester using feedstock from more than one agricultural operation, or importing feedstock from more than one agricultural operation. Also commonly referred to as a "community digester" or "centralized digester."

"Renewable portfolio standard" means a statutory or regulatory requirement that a load-serving entity provide a certain portion of the electricity it supplies to its customers from renewable energy sources, or any other statutory or regulatory requirement that a certain portion of electricity supplied to the electricity grid be generated from renewable energy sources.

"Reporting Period" means the period of time covered in by forest offset project data report. The first reporting period for an offset project in an initial crediting period may consist of 6 to 24 consecutive months; all subsequent reporting periods in an initial crediting and all reporting periods in any renewed crediting period must consist of 12 consecutive months.

"Reserve Price" means the minimum acceptable price for each CO₂ allowance in a specific auction. The reserve price at an auction is either the minimum reserve price or the CCR trigger price, as specified in Section 9.0.

"Reversal" means a GHG emission reduction or GHG removal enhancement for which CO₂ offset allowances have been issued that is subsequently released or emitted back into the atmosphere due to any intentional or unintentional circumstance.

"Serial number" means when referring to CO₂ allowances, the unique identification number assigned to each CO₂ allowance by the Department or its agent under subsection 6.4.5.

"Single Round Sealed-Bid Uniform Price Auction" means a single round sealed-bid uniform price auction format, under which bidders may submit multiple bids at different prices; the price paid by all awarded bidders will be uniform and equal to the highest rejected bid price.

"Source" means any governmental, institutional, commercial, or industrial structure, installation, plant, building, or facility that emits or has the potential to emit any air pollutant. A "source," including a "source" with multiple units, shall be considered a single "facility."

"State" means a State, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa and includes the Commonwealth of the Northern Mariana Islands.

"State of Delaware's CO₂ Budget Trading Program adjusted budget" means The State of Delaware's CO₂ Budget Trading Program adjusted budget is determined in accordance with subsection 5.3 and is the annual amount of CO₂ tons available in the State of Delaware for allocation in a given allocation year, in accordance with the CO₂ Budget Trading Program. CO₂ offset allowances allocated to project sponsors and CO₂ CCR allowances offered for sale at an auction are separate from and additional to CO₂ allowances allocated from the State of Delaware's CO₂ Budget Trading Program adjusted budget.

"State of Delaware CO₂ Budget Trading Program Base Budget" means the annual amount of CO₂ tons available in the State of Delaware for allocation in a given allocation year, in accordance with the CO₂ Budget Trading Program. CO₂ offset allowances allocated to project sponsors are separate from and additional to CO₂ allowances allocated from the State of Delaware CO₂ Budget Trading Program Base Budget.

"Submit or serve" means to send or transmit a document, information, or correspondence to the person specified in accordance with the applicable regulation:

(1) in person;

(2) by United States Postal Service; or

(3) by other means of dispatch or transmission and delivery.

Compliance with any "submission," "service," or "mailing" deadline shall be determined by the date of dispatch, transmission, or mailing and not the date of receipt.

"System benefit fund" means any fund collected directly from retail electricity or natural gas ratepayers.

"Third adjustment for banked allowances" means an adjustment applied to the State of Delaware CO₂ Budget Trading Program base budget for allocation years 2021 through 2025 to address allowances held in general and compliance accounts, including compliance accounts established pursuant to the CO₂ Budget Trading Program, but not including accounts opened by participating states, that are in addition to the aggregate quantity of emissions from all CO₂ budget sources in all of the participating states at the end of the fourth control period in 2020 and as reflected in the CO₂ Allowance Tracking System on March 15, 2021.

"Ton or tonnage" means any "short ton", or 2,000 pounds. For the purpose of determining compliance with the CO₂ requirements of subsection 1.5.3, total tons for a control period and each interim control period shall be calculated as the sum of all recorded hourly emissions (or the tonnage equivalent of the recorded hourly emissions rates) in accordance with Section 8.0, with any remaining fraction of a ton equal to or greater than 0.50 ton deemed to equal one ton and any fraction of a ton less than 0.50 ton deemed to equal zero tons. A short ton is equal to 0.9072 metric tons.

"Total solids" means total solids are the total of all solids in a sample. They include the total suspended solids, total dissolved solids, and volatile suspended solids.

"Transmission and/or distribution entity" means the assets and equipment used to transmit and distribute electricity from an electric generator to the electrical load of a customer. Includes all related assets and equipment located within the service territory of the entity, defined as the service territory of a load-serving entity specified by the applicable state regulatory agency.

"Twelve month period" means a period of twelve consecutive months determined on a rolling basis where a new twelve month period begins on the first day of each calendar month.

"Undistributed CO₂ allowances" mean CO₂ allowances originally allocated to a set aside account as pursuant to subsection 5.3 that were not distributed.

"Unit" means a fossil fuel-fired stationary boiler, combustion turbine, or combined cycle system.

"Unit operating day" means a calendar day in which a unit combusts any fuel.

"Unsold CO₂ allowances" mean CO₂ allowances that have been made available for sale in an auction conducted under the Department or its agent, but not sold.

"Verification" means the verification by an independent verifier that certain parts of a CO₂ emissions offset project consistency application and/or measurement, monitoring or verification report conforms to the requirements.

"Volatile solids" means the fraction of total solids that is comprised primarily of organic matter.

1.4 Measurements, abbreviations and acronyms.

Measurements, abbreviations, and acronyms used in this regulation are defined as follows:

1.4.1 CO₂: carbon dioxide.

1.4.2 CO₂e: carbon dioxide equivalent.

1.4.3 hr: hour.

1.4.4 lb: pounds.

1.4.5 MW: megawatt

1.4.6 MMBtu: one million British thermal units

1.4.7 MWh: megawatt hours

1.4.8 MWe: megawatt electrical.

1.5 Standard requirements.

1.5.1Permit requirements.

1.5.1.1 The CO₂ authorized account representative of each CO₂ budget source required to have an operating permit pursuant to Regulation 1102, 1130 and 1147 of this Title and each CO₂ budget unit required to have an operating permit pursuant to Regulation 1102, 1130 and 1147 of this Title shall:

1.5.1.1.1 submit to the Department a complete CO₂ budget permit application under subsection 3.3 in accordance with the deadlines specified in subsection 3.2; and

1.5.1.1.2 submit in a timely manner any supplemental information that the Department determines is necessary in order to review the CO₂ budget permit application and issue or deny a CO₂ budget permit.

1.5.1.2 The owners and operators of each CO₂ budget source required to have an operating permit pursuant to DE Regulations 1102, 1130 and 1147 of this Title and each CO₂ budget unit required to have an operating permit pursuant DE Regulations 1102, 1130 and 1147 of this Title for the source shall have a CO₂ budget permit and operate the CO₂ budget source and the CO₂ budget unit at the source in compliance with such CO₂ budget permit.

1.5.2Monitoring requirements.

1.5.2.1 The owners and operators and, to the extent applicable, the CO₂ authorized account representative of each CO₂ budget source and each CO₂ budget unit at the source shall comply with the monitoring requirements of Section 8.0.

1.5.2.2 The emissions measurements recorded and reported in accordance with Section 8.0 shall be used to determine compliance by the unit with the CO₂ requirements under subsection 1.5.3.

1.5.3CO₂ requirements.

1.5.3.1 The owners and operators of each CO₂ budget source and each CO₂ budget unit at the source shall hold CO₂ allowances available for compliance deductions under subsection 6.5, as of the CO₂ allowance transfer deadline, in the source's compliance account in an amount not less than the total CO₂ emissions for the control period from all CO₂ budget units at the source, less the CO₂ allowances deducted to meet the requirements of subsection 1.5.3.2, with respect to the previous two interim control periods, as determined in accordance with Sections 6.0 and 8.0.

1.5.3.2 The owners and operators of each CO₂ budget source and each CO₂ budget unit at the source shall hold CO₂ allowances available for compliance deductions under subsection 6.5, as of the CO₂ allowance transfer deadline, in the source's compliance account in an amount not less than the total CO₂ emissions for the interim control period from all CO₂ budget units at the source multiplied by 0.50, as determined in accordance with Sections 6.0 and 8.0.

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

1.5.3.4 Each ton of excess interim emissions shall constitute a separate violation of this section and applicable state law.

1.5.3.5 A CO₂ budget unit shall be subject to the requirements under subsection 1.5.3.1 starting on the later, of January 1, 2009 or the date on which the unit commences operation.

1.5.3.6 CO₂ allowances shall be held in, deducted from, or transferred among CO₂ Allowance Tracking System accounts in accordance with Sections 5.0, 6.0, and 7.0, and subsection 10.7.

1.5.3.7 A CO₂ allowance shall not be deducted, in order to comply with the requirements under subsections 1.5.3.1 or 1.5.3.2, for a control period or interim control period that ends prior to the year for which the CO₂ allowance was allocated. A CO₂ offset allowance shall not be deducted, in order to comply with the requirements under subsections 1.5.3.1 or 1.5.3.2, beyond the applicable percent limitations set out in subsection 6.5 .1.3.

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

1.5.3.9 A CO₂ allowance under the CO₂ Budget Trading Program does not constitute a property right.

1.5.4Excess emissions requirements. The owners and operators of a CO₂ budget source that has excess emissions in any control period or excess interim emissions for any interim control period shall:

1.5.4.1 Forfeit the CO₂ allowances required for deduction under subsection 6.5.4.1, provided CO₂ offset allowances may not be used to cover any part of such excess emissions; and

1.5.4.2 Pay any fine, penalty, or assessment or comply with any other remedy imposed under subsection 6.5.4.2.

1.5.5Recordkeeping and reporting requirements.

1.5.5.1 Unless otherwise provided, the owners and operators of the CO₂ budget source and each CO₂ budget unit at the source shall keep on site at the source each of the following documents for a period of 10 years from the date the document is created. This period may be extended for cause, at any time prior to the end of 10 years, in writing by the Department.

1.5.5.1.1 The account certificate of representation for the CO₂ authorized account representative for the source and each CO₂ budget unit at the source and all documents that demonstrate the truth of the statements in the account certificate of representation, in accordance with subsection 2.4, provided that the certificate and documents shall be retained on site at the source beyond such 10-year period until such documents are superseded because of the submission of a new account certificate of representation changing the CO₂ authorized account representative.

1.5.5.1.2 All emissions monitoring information, in accordance with Section 8.0 and 40 CFR 75.57.

1.5.5.1.3 Copies of all reports, compliance certifications, and other submissions and all records made or required under the CO₂ Budget Trading Program.

1.5.5.1.4 Copies of all documents used to complete a CO₂ budget permit application and any other submission under the CO₂ Budget Trading Program or to demonstrate compliance with the requirements of the CO₂ Budget Trading Program.

1.5.5.2 The CO₂ authorized account representative of a CO₂ budget source and each CO₂ budget unit at the source shall submit the reports and compliance certifications required under the CO₂ Budget Trading Program, including those under Section 4.0.

1.5.6Liability.

1.5.6.1 No permit revision shall excuse any violation of the requirements of the CO₂ Budget Trading Program that occurs prior to the date that the revision takes effect.

1.5.6.2 Any provision of the CO₂ Budget Trading Program that applies to a CO₂ budget source (including a provision applicable to the CO₂ authorized account representative of a CO₂ budget source) shall also apply to the owners and operators of such source and of the CO₂ budget units at the source.

1.5.6.3 Any provision of the CO₂ Budget Trading Program that applies to a CO₂ budget unit (including a provision applicable to the CO₂ authorized account representative of a CO₂ budget unit) shall also apply to the owners and operators of such unit.

1.5.7Effect on other authorities

No provision of the CO₂ Budget Trading Program, a CO₂ budget permit application, or a CO₂ budget permit, shall be construed as exempting or excluding the owners and operators and, to the extent applicable, the CO₂ authorized account representative of a CO₂ budget source or CO₂ budget unit from compliance with any other provisions of applicable State and federal law and regulations.

1.6 Computation of time.

1.6.1 Unless otherwise stated, any time period scheduled, under the CO₂ Budget Trading Program, to begin on the occurrence of an act or event shall begin on the day the act or event occurs.

1.6.2 Unless otherwise stated, any time period scheduled, under the CO₂ Budget Trading Program, to begin before the occurrence of an act or event shall be computed so that the period ends the day before the act or event occurs.

1.6.3 Unless otherwise stated, if the final day of any time period, under the CO₂ Budget Trading Program, falls on a weekend or a State of Delaware or Federal holiday, the time period shall be extended to the next business day.

1.7 Severability.

If any provision, or its application to any particular person or circumstances, is held invalid, the remainder, and the application thereof to other persons or circumstances, shall not be affected thereby.

12/11/18

7 Del. Admin. Code § 1147-1.0

16 DE Reg. 994 (03/01/13)
17 DE Reg. 644 (12/1/2013)
22 DE Reg. 511 (12/1/2018) (Final)