Md. Code Regs. 26.09.03.04

Current through Register Vol. 51, No. 21, October 18, 2024

Section 26.09.03.04 - Sequestration of Carbon due to Reforestation, Improved Forest Management, or Avoided Conversion

A. Forest Offset Project Standards.Offset projects that involve reforestation, improved forest management, or avoided conversion shall qualify for the award of CO₂ allowances if they meet the requirements of this regulation and the forest offset protocol.

B. Eligibility. Eligible forest offset projects shall satisfy all eligibility requirements of the forest offset protocol and this regulation.

C. Offset Project Description. The offset project sponsor shall provide a detailed narrative of the offset project actions taken, including documentation that the offset project meets the eligibility requirements of this regulation. The offset project description must include all information identified in sections 8.1 and 9.1 of the forest offset protocol, and any other information deemed necessary by the Department.

D. Carbon Sequestration Baseline Determination. Baseline onsite carbon stocks shall be determined as required in sections 6.1.1, 6.1.2, 6.2.1, 6.2.2, 6.2.3, 6.3.1, and 6.3.2 of the forest offset protocol, as applicable.

E. Calculating Carbon Sequestered. Net GHG reductions and GHG removal enhancements shall be calculated as required by section 6 of the forest offset protocol. The project's risk reversal rating shall be calculated using the Determination of a Forest Project's Reversal Risk Rating assessment worksheet in Appendix D of the forest offset protocol.

F. Monitoring and Verification Requirements. Monitoring and verification is subject to the following requirements:

(1) Monitoring and verification reports shall include all forest offset project data reports submitted to the Department, including any additional data required by section 9.2.2 of the forest offset protocol;

(2) The consistency application shall include a monitoring and verification plan certified by an independent verifier accredited pursuant to Regulation .06 of this chapter, which shall consist of a forest carbon inventory program, as required by section 8.1 of the forest offset protocol; and

(3) Monitoring and verification reports shall be submitted not less than every 6 years, except that the first monitoring and verification report for reforestation projects must be submitted within 12 years of project commencement.

G. Forest Offset Project Data Reports. A project sponsor shall submit a forest offset Project data report to the Department for each reporting period that shall meet the following:

(1) Each forest offset project data report must cover a single reporting period;

(2) Reporting periods must be contiguous; and

(3) There must be no gaps in reporting once the first reporting period has commenced.

H. Prior to the award of CO₂ offset allowances pursuant to Regulation .07 of this chapter, or to any surrender of allowances pursuant to §I of this regulation, any quantity expressed in metric tons, or metric tons of CO₂ equivalent, shall be converted to tons using the conversion factor specified in COMAR 26.09.01.02B(93).

I. Carbon Sequestration Permanence. The offset project shall meet the following requirements to address reversals of sequestered carbon:

(1) Unintentional reversals. Requirements for unintentional reversals are as follows:

(a) The project sponsor must notify the Department of the reversal and provide an explanation for the nature of the unintentional reversal within 30 calendar days of its discovery; and

(b) The project sponsor must submit to the Department a verified estimate of current carbon stocks within the offset project boundary within 1 year of the discovery of the unintentional reversal.

(2) Intentional Reversals. Requirements for intentional reversals are as follows:

(a) If an intentional reversal occurs, the project sponsor shall, within 30 calendar days of the intentional reversal:

(i) Provide notice, in writing, to the Department of the intentional reversal; and

(ii) Provide a written description and explanation of the intentional reversal to the Department.

(b) Within 1 year of the occurrence of an intentional reversal, the project sponsor shall submit to the Department a verified estimate of current carbon stocks within the offset project boundary.

(c) If an intentional reversal occurs, and CO₂ offset allowances have been awarded to the offset project, within 6 months following notification by the Department, the forest owner must surrender to the Department for retirement, the number of CO₂ allowances corresponding to the quantity of CO₂ equivalent tons reversed.

(i) Notification by the Department will occur after the verified estimate of carbon stocks has been submitted to the Department, or after 1 year has elapsed since the occurrence of the reversal if the project sponsor fails to submit the verified estimate of carbon stocks; and

(ii) If the forest owner does not surrender valid CO₂ allowances to the Department within 6 months following notification by the Department, the forest owner will be subject to an enforcement action and each CO₂ equivalent ton of carbon sequestration reversed will constitute a separate violation of this regulation and applicable State law.

(d) Project Termination. Requirements for project termination are as follows:

(i) Within 6 months of project termination, the project sponsor shall surrender to the Department or its agent for retirement, a quantity of CO₂ allowances in the amount calculated pursuant to project termination provisions in the forest offset protocol; and

(ii) If the project sponsor fails to surrender to the Department a quantity of CO₂ Allowances in the amount calculated pursuant to project termination provisions in the forest offset protocol within 6 months following project termination, the project sponsor shall be subject to enforcement action and each CO₂ offset allowance not surrendered will constitute a separate violation of this regulation and applicable State law.

(3) Disposition of Forest Sequestration Projects After a Reversal. If a reversal lowers the forest offset project's actual standing live carbon stocks below its project baseline standing live carbon stocks, the forest offset project will be terminated by the Department.

J. Timing of Forest Offset Projects. The Department may award CO₂ offset allowances under Regulation .07 of this chapter only for forest offset projects that are initially commenced on or after January 1, 2014.

K. Projects that Have Been Awarded Credits Under a Voluntary Greenhouse Gas Reduction Program.

(1) For projects that have been awarded credits under a voluntary greenhouse gas reduction program, the number of CO₂ Offset Allowances will be calculated pursuant to the requirements of this regulation, without regard to the number of credits that were awarded to the project under the voluntary program.

(2) The provisions of Regulation .02C(6) and F(2)(b) may not apply to forest projects that have been awarded credits under a voluntary greenhouse gas reduction program provided that the following conditions are satisfied:

(a) The project satisfies all other general requirements of this chapter, including all specific requirements of this regulation, for all reporting periods for which the project has been awarded credits under a voluntary greenhouse gas program and also intends to be awarded CO₂ offset allowances pursuant to Regulation .07 of this chapter;

(b) At the time of submittal of the consistency application for the project, the project sponsor submits forest offset data reports and a monitoring and verification report meeting all requirements of §§F and G of this regulation that covers all reporting periods for which the project has been awarded credits under a voluntary greenhouse gas program and also seeks an award of CO₂ offset allowances pursuant to Regulation .07 of this chapter; and

(c) The voluntary greenhouse gas program has published information on its website to allow the Department to verify the information included in the consistency application, and the consistency application includes information sufficient to allow the Department to make the following determinations:

(i) The offset project has met all legal and contractual requirements to allow it to terminate its relationship with the voluntary greenhouse gas program, and such termination has been completed; and

(ii) The project sponsor or voluntary greenhouse gas program has cancelled or retired all credits that were awarded for carbon sequestration that occurred during the time periods for which the project intends to be awarded CO₂ offset allowances pursuant to Regulation .07 of this chapter, and such credits were cancelled or required for the sole purpose of allowing the project to be awarded CO₂ offset allowances pursuant to Regulation .07 of this chapter.

Md. Code Regs. 26.09.03.04

Regulation .04A amended as an emergency provision effective December 28, 2009 (37:4 Md. R. 336); amended permanently effective May 3, 2010 (37:9 Md. R. 674)
Regulation .04D amended effective May 18, 2009 (36:10 Md. R. 717); amended effective 45:26 Md. R. 1249, eff. 12/31/2018