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Canadian Greenhouse Gas Offset Credit System Regulations (SOR/2022-111)

Regulations are current to 2024-11-11

Process for Offset Credit Issuance (continued)

Project Registration

Marginal note:Conditions of registration

  •  (1) Subject to section 9, a project, of a type for which a protocol has been included in the Compendium of Federal Offset Protocols, may be registered in the offset credit system if its proponent submits an application for registration to the Minister that includes the information set out in Schedule 1 and the following conditions are met:

    • (a) the proponent is an individual who resides in Canada or, if the proponent is not an individual, the proponent has a place of business in Canada;

    • (b) the proponent has exclusive entitlement to claim the credits issued for the GHG reductions generated by the project;

    • (c) the proponent has the necessary authorizations to carry out the project activities;

    • (d) prior to the project start date, the baseline conditions set out in the protocol to be eligible under that protocol are met;

    • (e) the activities undertaken as part of the project to prevent GHGs from being emitted or to remove GHGs from the atmosphere are set out in the applicable protocol;

    • (f) the reductions that the project could generate would be additional;

    • (g) the project is not registered in any other offset credit system;

    • (h) no credits will be attributed under another GHG reduction mechanism for the GHG reductions generated by the project;

    • (i) no provincial offset credit protocol in the province in which the project is situated, established under an offset credit program for that province, covers the same activities as those set out in the applicable federal protocol;

    • (j) with respect to a sequestration project,

      • (i) the proponent has specified whether the tonne-tonne, tonne-year or hybrid tonne-year quantification method, as set out in the protocol, will be used for the duration of the project, and

      • (ii) in the case of a proponent opting for the tonne-tonne or hybrid tonne-year quantification method, the proponent has established a reversal risk management plan in accordance with section 21;

    • (k) a previous registration by the proponent of the project under these Regulations has not been cancelled as a result of a voluntary reversal;

    • (l) neither the proponent nor their authorized official has been found guilty of an offence under section 380 of the Criminal Code, within five years prior to submitting the application for registration; and

    • (m) the application for registration is submitted within the time limits set out in section 10.

  • Marginal note:Exception — provincial protocol

    (2) Despite paragraph (1)(i), in the case where a provincial offset credit protocol, established under an offset credit program for that province, applies to the activities undertaken as part of a project, the project may be registered if:

    • (a) the provincial protocol is published after the federal protocol is included in the Compendium of Federal Offset Protocols; and

    • (b) the application for registration is submitted no more than six months after the day on which the project could have been registered in the provincial offset credit program under that protocol.

  • Marginal note:Declaration

    (3) The application for registration must be accompanied by a declaration, dated and signed by the proponent or their authorized official, stating that the information contained in the application is accurate and complete.

  • Marginal note:Project in more than one province

    (4) If a project is situated in more than one province, the proponent must register, as distinct projects, the portions of the project situated in each province.

  • Marginal note:Request to open account

    (5) The proponent, in accordance with subsection 186(1) of the Act, must submit a request to open a GHG Offset Credit System account in the tracking system if they do not already have such an account.

Marginal note:Aggregation of projects

  •  (1) A proponent may register an aggregation of projects, made up of a group of projects of a type for which a protocol has been included in the Compendium of Federal Offset Protocols and that have not previously been registered under these Regulations or a group of projects that are already registered as part of an aggregation under these Regulations, if the following conditions are met:

    • (a) the proponent is the proponent for each of the projects in the aggregation;

    • (b) all of the projects in the aggregation are situated in the same province;

    • (c) each project in the aggregation meets the conditions of registration set out in subsection 8(1);

    • (d) the same protocol, and version of that protocol, applies to each project in the aggregation;

    • (e) with respect to sequestration projects, if the protocol provides for a choice between the tonne-tonne, hybrid tonne-year or tonne-year quantification method, the same method is used for all projects in the aggregation;

    • (f) an application for registration of the aggregation was submitted in accordance with subsection (2); and

    • (g) the number of projects in the aggregation does not exceed the maximum number of projects for the given project type set out in the protocol.

  • Marginal note:Registration application

    (2) The application for registration of an aggregation of projects must be submitted to the Minister and include the information referred to in Schedule 2.

  • Marginal note:Declaration

    (3) The application for registration must be accompanied by a declaration, dated and signed by the proponent or their authorized official, stating that the information contained in the application is accurate and complete.

  • Marginal note:Addition of a project

    (4) A proponent may add a project, that has not previously been registered under these Regulations, to an aggregation of projects if the conditions set out in paragraphs (1)(a) to (e) and (g) are met and if they submit an application to the Minister, including the declaration referred to in subsection (3), containing the information referred to in subsection (2) for the project, with the information specified in paragraphs 4(c) and (d) of Schedule 2 updated to account for the addition of the new project.

  • Marginal note:Transfer of a project

    (5) A project in an aggregation may only be transferred to another aggregation if the date on which the project’s crediting period began is on or after the date on which the crediting period of the aggregation to which the project is being added began.

  • Marginal note:Withdrawal of a project

    (6) If a project is withdrawn from an aggregation of projects, the proponent must notify the Minister in writing and specify the date the project was withdrawn from the aggregation.

Marginal note:Application deadline

  •  (1) The application for registration must be submitted

    • (a) if the project start date is before the date the applicable protocol is included in the Compendium of Federal Offset Protocols, within 18 months after the date the protocol is included in the Compendium of Federal Offset Protocols and no more than 10 years after the project start date; and

    • (b) if the project start date is on or after the date on which the applicable protocol is included in the Compendium of Federal Offset Protocols, within 18 months after the project start date.

  • Marginal note:Exception — project registered in another system

    (2) Despite paragraph (1)(a), if the project is registered in a GHG offset credit system, other than a system administered by the federal or a provincial government, at the time the applicable protocol is included in the Compendium of Federal Offset Protocols, the application may be submitted more than 18 months after the protocol is included in the Compendium of Federal Offset Protocols but no later than 10 years after the project start date.

Marginal note:Registration by the Minister

 Subject to subsection 6(4), if a proponent meets the conditions set out in section 8 or 9, the Minister must register the project or the aggregation of projects, open the GHG Offset Credit System account in the tracking system, if applicable, and notify the proponent.

Marginal note:Change to boundaries

 The proponent may only modify the coordinates and geographic boundaries of the site where activities are undertaken as part of the project that were provided in the application for registration

  • (a) with respect to a project registered in accordance with section 8, until the end of the period covered by the initial report; and

  • (b) with respect to a project in an aggregation, registered in accordance with section 9, until the end of the first 12 months following the registration of the project as part of an aggregation.

GHG Offset Credit System Account

Marginal note:Maintaining account

  •  (1) A proponent must maintain their GHG Offset Credit System account until the later of

    • (a) at least 100 years after the end date of the last crediting period of all sequestration projects related to that account if the tonne-tonne quantification method was used for any of those projects; and

    • (b) at least eight years after the end date of the last crediting period of all projects related to that account if the tonne-tonne quantification method was not used for any of the projects.

  • Marginal note:Closing of account

    (2) The Minister may, under subsection 186(3) of the Act, close a GHG Offset Credit System account that has been inactive for more than seven years if the Minister notifies the holder of the account of the Minister’s intention to do so and the holder does not request that the account remain open within 60 days after the date the notice was received.

  • Marginal note:Revocation of credits

    (3) If the GHG Offset Credit System account contains offset credits, those credits are revoked prior to the account being closed under subsection (2).

Cancellation

Marginal note:Cancellation

  •  (1) The Minister may cancel the registration of a project if

    • (a) the proponent requests that the registration be cancelled;

    • (b) the proponent fails to comply with paragraph 20(7)(a), (b) or (c), as the case may be;

    • (c) the proponent’s GHG Offset Credit System account has been closed under subsection 13(2);

    • (d) the conditions of registration set out in paragraphs 8(1)(a) to (h), (j) or (l) are no longer met;

    • (e) in the case of a sequestration project, other than a sequestration project for which a tonne-year quantification method is used, the cause of the reversal was within the control of the proponent or there was a failure to implement the reversal risk management plan, as determined in accordance with subsection 40(1);

    • (f) in the case of a sequestration project, other than a sequestration project for which a tonne-year quantification method is used, a reversal diminishes, in accordance with the protocol, the inventory of sequestered CO2e to a level below the inventory in the baseline scenario; or

    • (g) the proponent fails to comply with subsection 181(2) or (3) of the Act.

  • Marginal note:Notice

    (2) The Minister must provide notice of the Minister’s intention to cancel the registration under subsection (1) to the proponent at least 30 days before cancelling that registration, to provide time for the proponent to provide representations.

  • Marginal note:Decision

    (3) The Minister must, after the period set out in subsection (2), confirm or revise his decision and notify the proponent.

Marginal note:Consequences for sequestration project

  •  (1) If the registration of a sequestration project using either the tonne-tonne or the hybrid tonne-year quantification method is cancelled, the Minister may

    • (a) for the purposes of section 180 of the Act, revoke any offset credits in the proponent’s GHG Offset Credit System account for the project and the number of offset credits deposited into the environmental integrity account in respect of the project; and

    • (b) where the number of offset credits revoked from the proponent’s GHG Offset Credit System account for the project under paragraph (a) is less than the number of offset credits issued to the proponent in respect of the project,

      • (i) for the purposes of subsection 181(1) of the Act, require the proponent to remit compliance units by giving them notice indicating the number of compliance units to be remitted and the deadline by which the remittance is to be made, and

      • (ii) if the proponent does not remit compliance units in accordance with subparagraph (i) or make a payment in lieu of remitting compliance units under subsection 181(3) of the Act, revoke, for the purposes of section 180 of the Act, offset credits in the environmental integrity account to make up the difference.

  • Marginal note:Manner of remittance

    (2) Subject to subsection (3), the compliance units remitted to the Minister for the purposes of subparagraph (1)(b)(i), in accordance with subsection 181(2) of the Act, must

    • (a) in the case of offset credits or units or credits recognized as compliance units under a regulation made under the Act, have been issued for GHG reductions that occurred within eight calendar years before the deadline indicated in the notice provided under that subparagraph; and

    • (b) in the case of surplus credits, have been issued within five calendar years before the deadline indicated in the notice provided under that subparagraph.

  • Marginal note:Surplus credits

    (3) If a proponent is required to remit compliance units, the proponent may remit surplus credits if those surplus credits were issued to a covered facility located in a province listed in Part 2 of Schedule 1 to the Act during the calendar year in which the Minister notified the proponent under subparagraph (1)(b)(i) of the number of compliance units to be remitted.

 

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