9VAC5-140-7210. CO2 allowance allocations

A. The department will allocate the Virginia CO 2 Budget Trading Program base budget CO 2 allowances to the Virginia Auction Account. B. For allocation years 2021 through 2030, the Virginia CO 2 Budget Trading Program adjusted budget shall be the maximum number of allowances available for allocation in a given allocation year, except for CO 2 CCR allowances. C. In the event that the CCR is triggered during an auction, the department will allocate CO 2 CCR allowances, separate from and additional to the Virginia CO 2 Budget Trading Program base budget set forth in 9VAC5-140-7190 to the Virginia Auction Account. The CCR allocation is for the purpose of containing the cost of CO 2 allowances. The department will allocate CO 2 CCR allowances as follows: 1. On or before January 1, 2021, and each year thereafter, the department will allocate CO 2 CCR allowances equal to the quantity in Table 140-5A. Table 140-5A CO 2 CCR Allowances from 2021 Forward Table 140-5A CO 2 CCR Allowances from 2021 Forward 2021 2.716 million tons 2021 2.716 million tons 2022 2.632 million tons 2022 2.632 million tons 2023 2.548 million tons 2023 2.548 million tons 2024 2.464 million tons 2024 2.464 million tons 2025 2.380 million tons 2025 2.380 million tons 2026 1.148 million tons 2026 1.148 million tons 2027 2.212 million tons 2027 2.212 million tons 2028 2.128 million tons 2028 2.128 million tons 2029 2.044 million tons 2029 2.044 million tons 2030 and each year thereafter 1.960 million tons 2030 and each year thereafter 1.960 million tons 2. CCR allowances allocated for a calendar year will be automatically transferred to the Virginia Auction Account to be auctioned. Following each auction, all CO 2 CCR allowances sold at auction will be transferred to winning bidders' accounts as CO 2 CCR allowances. 3. Unsold CO 2 CCR allowances will remain in the Virginia Auction Account to be re-offered for sale at auction within the same calendar year. CO 2 CCR allowances remaining unsold at the end of the calendar year in which they were originated will be made unavailable for sale at future auctions. D. In the event that the ECR is triggered during an auction, the department will authorize its agent to withhold CO 2 allowances as needed. The department will further authorize its agent to convert and transfer any CO 2 allowances that have been withheld from any auction into the Virginia ECR account. The ECR withholding is for the purpose of additional emission reduction in the event of lower than anticipated emission reduction costs. The department's agent will withhold CO 2 ECR allowances as follows: 1. If the condition in 9VAC5-140-7420 C 1 is met at an auction, then the maximum number of CO 2 ECR allowances that will be withheld from that auction will be equal to the quantity shown in Table 140-5B minus the total quantity of CO 2 ECR allowances that have been withheld from any prior auction in that calendar year. Any CO 2 ECR allowances withheld from an auction will be transferred into the Virginia ECR account. Table 140-5B ECR Allowances from 2021 Forward Table 140-5B ECR Allowances from 2021 Forward 2021 2.716 million tons 2021 2.716 million tons 2022 2.632 million tons 2022 2.632 million tons 2023 2.548 million tons 2023 2.548 million tons 2024 2.464 million tons 2024 2.464 million tons 2025 2.380 million tons 2025 2.380 million tons 2026 1.148 million tons 2026 1.148 million tons 2027 2.212 million tons 2027 2.212 million tons 2028 2.128 million tons 2028 2.128 million tons 2029 2.044 million tons 2029 2.044 million tons 2030 and each year thereafter 1.960 million tons 2030 and each year thereafter 1.960 million tons 2. Allowances that have been transferred into the Virginia ECR account shall not be withdrawn. E. The adjustment for banked allowances will be as follows. On March 15, 2021, the department may determine the adjustment for banked allowances quantity for allocation years 2021 through 2025 through the application of the following formula: TABA = ((TA – TAE)/5) x RS% Where: TABA is the adjustment for banked allowances quantity in tons. TA, adjustment, is the total quantity of allowances of vintage years prior to 2021 held in general and compliance accounts, including compliance accounts established pursuant to the CO 2 Budget Trading Program but not including accounts opened by participating states, as reflected in the CO 2 Allowance Tracking System on March 15, 2021. TAE, adjustment emissions, is the total quantity of 2018, 2019, and 2020 emissions from all CO 2 budget sources in all participating states, reported pursuant to CO 2 Budget Trading Program as reflected in the CO 2 Allowance Tracking System on March 15, 2021. RS% is Virginia budget divided by the regional budget. F. CO 2 Budget Trading Program adjusted budgets for 2021 through 2025 shall be determined as follows: on April 15, 2021, the department will determine the Virginia CO 2 Budget Trading Program adjusted budgets for the 2021 through 2025 allocation years by the following formula: AB = BB – TABA Where: AB is the Virginia CO 2 Budget Trading Program adjusted budget. BB is the Virginia CO 2 Budget Trading Program base budget. TABA is the adjustment for banked allowances quantity in tons. G. The department or its agent will publish the CO 2 trading program adjusted budgets for the 2021 through 2025 allocation years.