Lawson Lundell LLP
  January 19, 2010 - British Columbia

Climate Change Newsletter - New Greenhouse Gas Reporting Regulations
  by Climate Change Law Group

January 1, 2010 ¨C GHG Reporting Requirements in Effect

As of January 1, 2010, "single facility operations" and "linear facilities operations", located in British Columbia and emitting 10,000 tonnes or more of greenhouse gases (GHGs) per year will be required to register with the Ministry of Environment (MOE), collect emissions data, and report their GHG emissions.

Policy Consultation

In October of 2008, the MOE issued a consultation paper entitled "Policy Intentions Paper for Consultation on GHG Reporting Regulations".  The MOE summarized public responses on the Intentions Paper in a paper issued in February 2009 entitled ¡°Summary of Public Comments¡±.  These documents can be accessed at www.env.gov.bc.ca/epd/codes/ggrcta/pdf/ghgrr-paper.pdf and www.env.gov.bc.ca/epd/codes/ggrcta/pdf/ghgrr-comments.pdf, respectively.

Operations Required to Report Emissions

The Reporting Regulation includes a detailed list of the types of single facility operations which must report GHG emissions including:

¡¤        Aluminum or alumina production

¡¤        Base metals smelting

¡¤        Cement production

¡¤        Chemical/petrochemical production

¡¤        Large commercial or institutional facilities

¡¤        Electricity generation and
co-generation (thermal)

¡¤        Electricity transmission (SF6 emissions)

¡¤        Food production

¡¤        Lime manufacturing

¡¤        Manufacturing

¡¤        Mining

¡¤        Non-metallic mineral products manufacturing

¡¤        Oil and gas extraction and gas processing

¡¤        Pipeline transportation/transmission

¡¤        Petroleum refining

¡¤        Pulp and paper production

¡¤        Wood products manufacturing

 Linear facilities operations include:

¡¤        Oil and gas extractions and gas processing activities

¡¤        Electricity transmission

¡¤        Natural gas transmission, natural gas distribution or natural gas storage

¡¤        Oil transmission

¡¤        Carbon-dioxide transmission

The 2008 Intentions Paper estimated that approximately 240-280 facilities in British Columbia would have GHG reporting requirements.

Both single site and linear operations have requirements to report on emissions from general stationary combustion.  Only single facility operations have a requirement to report on emissions from mobile equipment.

Emissions Estimates

The MOE has prepared a very basic GHG emissions estimator that can be used to provide an operator with a preliminary indication as to whether the facility may have registration and reporting requirements under the Reporting Regulation.  The facility operator can provide inputs of fuel use, raw material use and production data into a spreadsheet which then automatically estimates GHG emissions using standards emission factors.  The emissions estimator can be accessed at www.env.gov.bc.ca/epd/codes/ggrcta/reporting-regulation/reporting/excel/ghg-estimator.xls.

Key Registration and Reporting Dates

The key registration and reporting dates with respect to 2010 emissions are listed by the Ministry as follows:

2010

January 1

BEGIN COLLECTING EMISSIONS DATA

Ensure data collection and documentation systems support compliance with regulatory requirements.

February 28

INITIAL FORECAST OF EMISSIONS

Forecast emissions to determine if likely to be greater than 10,000 tonnes emission reporting threshold.

April 1

REGISTER

If forecast greater than 10,000 tonnes, complete form on the Ministry of Environment web page (available February 2010).

2011

January 1

BEGIN COMPILING EMISSIONS DATA FOR 2010 EMISSIONS REPORT

CONTINUE COLLECTING DATA ¨C 2011 EMISSIONS

March 31

SUBMIT 2010 REPORT

A.   If 10,000 tonnes or more and less than 25,000 tonnes:

       1.  Report 2010 emissions;

       2.  Report 2006 through 2009 emissions for each year emissions were greater than 20,000 tonnes.

B.    If 25,000 tonnes or more:

       1.  Report 2010 emissions;

       2.  Engage verification body and preparation for submissions of supplementary report with verification statement (by Sept. 1);

       3.  Report 2006 through 2009 emissions for each year emissions were greater than 20,000 tonnes.

It is particularly important for reporting facilities which will have emissions in 2010 > 10,000 tonnes, to begin data collection and documentation immediately, and to register with the MOE before April 1, 2010.  The Ministry indicates that the form for registration will be available on its website by February 2010.

Methodology

The Methodology Manual, issued by MOE in December 2009 provides details of the specified methodologies for quantifying emissions from source types in various industrial operations.  The Methodology Manual covers general stationary combustion, fuel combustion by mobile equipment at a single facility operation, and from various industrial operations.

"General stationary combustion" is defined in the Methodology Manual as follows:

"General stationary fuel combustion sources are devices that combust solid, liquid, or gaseous fuel for the purpose of generating steam (or providing useful heat or energy) for industrial, commercial, or institutional use; or reducing the volume of waste by removing combustible matter.  General stationary combustion sources are boilers, combustion turbines, engines, incinerators, and process heaters, and any other stationary combustion device that is not specifically addressed under the provisions for another source category in this rule."

"Fuel combustion by mobile equipment at a single facility operation" is defined in the Methodology Manual as follows:

"The mobile equipment at facilities category includes:

(a)       Mobile equipment used for the on-site transportation or movement of substances, materials or products, and

(b)       Other mobile equipment such as tractors, mobile cranes, log transfer equipment, mining machinery, graders, backhoes and bulldozers and other industrial equipment,

but does not include an on road vehicle, an aircraft or a marine vessel."

The Methodology Manual can be found at www.env.gov.bc.ca/epd/codes/ggrcta/reporting-regulation/pdf/methodology-manual.pdf.

Verification Requirements

The Reporting Regulation requires that reporting operations with annual GHG emissions ¡Ý  25,000 tonnes include with their emissions report a verification statement prepared by an accredited verification body.  Verification of emissions reports must comply with the requirements specified in the Reporting Regulations and in ISO 14064-3, and be conducted to provide a reasonable level of assurance.  The verification manual issued by the Ministry on December 1, 2009 provides details on both reporting requirements and verification standards.

The Verification Manual can be found at www.env.gov.bc.ca/epd/codes/ggrcta/reporting-regulation/pdf/verification-manual.pdf.

Comparison to Other Initiatives

B.C. is a member of the Western Climate Initiative (WCI).  The Design Recommendations of the WCI respecting the proposed ¡°cap-and-trade¡± program would apply to facilities emitting 25,000 tonnes of GHG per year (expected to cover 90% of industrial emissions).  The B.C. Policy Intentions Paper acknowledges that the Reporting Regulation threshold of 10,000 tonnes per year is lower, and says that "this will support the integrity of the allowance threshold and ensure that the threshold is set at an appropriately comprehensive level".  The MOE anticipates that the cap and trade system will be implemented in 2012.

Questions and Answers

The MOE website has a space for "Questions and Answers" but indicates that this feature is still under development.

We would be pleased to provide assistance in addressing any questions or concerns relating to the interpretation and application of the GHG Reporting Regulation.

Key Contacts

Brad Armstrong, Q.C.
P: 604.631.9126
E: [email protected]

Gordon Craig
P: 604.631.9155
E: [email protected]

John Olynyk
P: 403.781.9472
E: [email protected]



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