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Volume 62, No. 22

231/2019

The British Columbia Gazette,

Part II

November 19, 2019

B.C. Reg. 231/2019 , deposited November 7, 2019, under the GREENHOUSE GAS INDUSTRIAL REPORTING AND CONTROL ACT [sections 46 and 47] and the CARBON TAX ACT [section 84]. Order in Council 580/2019, approved and ordered November 7, 2019.

On the recommendation of the undersigned, the Lieutenant Governor, by and with

the advice and consent of the Executive Council, orders that

(

a) the Greenhouse Gas Emission Reporting Regulation, B.C. Reg. 249/2015, is amended

as set out in the attached Appendix 1, and

(

b) the Carbon Tax Regulation, B.C. Reg. 125/2008, is amended as set out in the

attached Appendix 2.

— L. POPHAM, Presiding Member of the Executive Council .

Appendix 1

Section 1 of the Greenhouse Gas Emission Reporting Regulation, B.C. Reg. 249/2015,

is amended

(

a) in subsection (1) by repealing the definition of "liquefied natural gas operation" and substituting the following:

"liquefied natural gas operation" means an industrial operation that is designed for producing liquefied natural gas

on a commercial scale; , and

(

b) in subsection (2) by adding the following definition:

"authorization date" , in relation to an industrial operation, means the first date on which the industrial

operation is legally authorized to begin operations; .

Section 8 is amended

(

a) in subsection (1) by striking out " An industrial operation " and substituting " Subject to subsection (1.1), an industrial operation ", and

(

b) by adding the following subsection:

(1.1) An industrial operation that is in a class set out in column 1 of the

schedule

to the Act is a reporting operation for a reporting period if

(

a) the industrial operation is a reporting operation under subsection (1) of

this

section for the reporting period, or

(

b) the authorization date for the industrial operation occurs in the reporting

period.

3 The following

section is added:

Disclosure of information in relation to Carbon Tax Act

44.1 For the purposes of

section 42 (4) (

a) of the Act, the Carbon Tax Act and the regulations under that Act are prescribed.

Appendix 2

1 The Carbon Tax Regulation, B.C. Reg. 125/2008, is amended by adding the following

Part:

Part 5.1 – Regulated Operation Refund

Division 1 –

Definitions and

Interpretation

Definitions and

interpretation

29.3

(1) In this Part:

"attributable emissions rate" , in relation to a regulated operation and a calendar year, means, subject to subsection (2),

the quotient of

(

a) the greenhouse gas emissions attributable under

section 4 of the Greenhouse

Gas Emission Reporting Regulation to the regulated operation for the calendar year,

expressed as tonnes of carbon dioxide equivalent, and

(

b) the number of production units produced by the regulated operation in the

calendar year;

"authorization date" has the same meaning as in the Greenhouse Gas Emission Reporting Regulation;

"base tax" , in relation to a regulated operation and a calendar year, means the tax imposed

under the Act in the calendar year in respect of fuel and combustibles that meet both

of the following criteria:

(

a) the fuel and combustibles are used in the regulated operation;

(

b) the greenhouse gas emissions resulting from the use referred to in paragraph (

a) are attributable under

section 4 of the Greenhouse Gas Emission Reporting Regulation

to the regulated operation;

"carbon dioxide equivalent" has the same meaning as in the Greenhouse Gas Industrial Reporting and Control Act ;

"cut-off date" , in relation to a regulated operation, means the date that is 30 days after the date

of first shipment for the regulated operation;

"date of first shipment" , in relation to a regulated operation, means the date on which the regulated operation

transports its first shipment of product from the regulated operation for delivery

(

a) to a commercial purchaser of the product for consumption or resale,

(

b) to another regulated operation that is to refine or otherwise add commercial

value to the product, or

(

c) outside of British Columbia;

"eligible tax" , in relation to a regulated operation and a calendar year, has the meaning given

to it in

section 29.31;

"emissions coverage" , in relation to a jurisdiction, means the percentage, by mass, of carbon dioxide

equivalent emissions in the jurisdiction on which a price is imposed by law through

a specified measure;

"environment minister" means the minister responsible for the administration of the Greenhouse Gas Industrial Reporting and Control Act ;

"GGIRCA director" means the director under the Greenhouse Gas Industrial Reporting and Control Act ;

"global carbon price" has the meaning given to it in

section 29.33 (2);

"new entrant period" , in relation to a regulated operation, means the period of 24 months determined under

section 29.32 (1);

"notional tax rate" , in relation to a calendar year specified in column 1 of Table 1 to this Part, means

the notional tax rate specified in column 2 opposite that calendar year;

"operator" , in relation to a regulated operation, has the same meaning as in the Greenhouse

Gas Emission Reporting Regulation;

"production unit" , in relation to a regulated operation in a class of regulated operations described

in column 1 of Table 2 to this Part, means the unit set out in column 2 opposite that

description;

"provincial emissions coverage" has the meaning given to it in

section 29.34;

"regulated operation" has the same meaning as in the Greenhouse Gas Industrial Reporting and Control Act ;

"specified measure" means

(

a) a carbon or greenhouse gas emissions tax, or

(

b) a carbon or greenhouse gas emissions trading scheme;

"target emissions rate" has the meaning given to it in

section 29.35 (2);

"threshold emissions rate" has the meaning given to it in

section 29.35 (4).

(2) The definition of "attributable emissions rate" in subsection (1) is to be

read in

section 29.38, in relation to a regulated operation and a calendar year any

part of which is in the new entrant period for the regulated operation, as though

(

a) the greenhouse gas emissions attributable to the regulated operation in relation

to the new entrant period were not attributable for the calendar year, and

(

b) the production units produced by the regulated operation in the new entrant

period were not produced in the calendar year.

Eligible tax

29.31 The eligible tax in relation to a regulated operation and a calendar year is the

amount determined in accordance with the following formula:

eligible tax = base tax x

1 –

notional tax rate

where

base tax

the base tax in relation to the regulated operation that was imposed in the calendar

year;

notional tax rate

the notional tax rate for the calendar year.

New entrant period

29.32

(1) The new entrant period for a regulated operation is the period of 24 months that

begins on the following date, as applicable:

(

a) if the operator of the regulated operation gives notice in writing to the

director in accordance with subsection (2), the date specified in the notice;

(

b) in any other case, the date of first shipment for the regulated operation.

(2) A notice under subsection (1) (

a) must

(

a) be given to the director by the cut-off date for the regulated operation,

and

(

b) specify a date that is

(

i) on or after the authorization date for the regulated operation, and

(ii) on or before the date of first shipment for the regulated operation.

Global carbon price

29.33

(1) In this section:

"GDP share" , in relation to a jurisdiction, means the quotient of

(

a) the gross domestic product of the jurisdiction, and

(

b) the gross world product;

"weighted average" means an average weighted by

(

a) GDP share, and

(

b) emissions coverage.

(2) The global carbon price is, for 2025 to 2029 and each subsequent period of

5 calendar years, the price

(

a) set for the period by the environment minister in accordance with subsection (3),

and

(

b) published in the Gazette at least 60 days before the first day of the period.

(3) The global carbon price under subsection (2) for a period must be informed

by a review that

(

a) is carried out by an independent third party selected by the GGIRCA director,

and

(

b) estimates the weighted average global price, imposed by law through a specified

measure, per tonne of carbon dioxide equivalent emissions on the day immediately before

the first day of the period.

Provincial emissions coverage

29.34 The provincial emissions coverage for a calendar year is the emissions coverage for

British Columbia in the calendar year

(

a) estimated by the environment minister, and

(

b) published in the Gazette at least 60 days before the first day of the calendar

year.

Target and threshold emissions rates

29.35

(1) In this section:

"comparable operation" , in relation to a class of regulated operations, means an operation outside of British

Columbia that, were it in British Columbia, would be a regulated operation in the

class;

"default threshold emissions rate" , in relation to a class of regulated operations and a period, means the product of

(

a) the target emissions rate set under subsection (2) (

b) for the class and period,

and

(b) 2;

"eligible" , in relation to an operation, means that the operation produces at least 1 000 000

production units per year;

"emissions rate" , in relation to an operation, means the greenhouse gas emissions of the operation,

attributed having regard to the methodology of

section 4 of the Greenhouse Gas Emission

Reporting Regulation, per production unit of the operation;

"production unit" , in relation to a comparable operation, means the unit that would be the production

unit of the operation were it a regulated operation;

"production weighted average" , in relation to the emissions rates of two or more operations, means the average

of the emissions rates after the emissions rate of each operation has been multiplied

by the quotient of

(

a) the number of production units produced by the operation, and

(

b) the sum of the numbers of production units produced by all of the operations.

(2) The target emissions rate for a regulated operation in a class of regulated

operations described in column 1 of Table 2 to this

Part is,

(

a) for 2020 to 2024, the rate set out in column 4 opposite that description,

and

(

b) for each subsequent period of 5 calendar years, the rate

(

i) set for the class and period by the environment minister in accordance with

subsection (3), and

(ii) published in the Gazette by 60 days after the first day of the period.

(3) The target emissions rate under subsection (2) (

b) for a class of regulated

operations and a period must be informed by a review that

(

a) is carried out by an independent third party selected by the GGIRCA director,

and

(

b) estimates the production weighted average of the emissions rates of the 5 eligible

comparable operations for the class that have the lowest emissions rates.

(4) The threshold emissions rate for a regulated operation in a class of regulated

operations described in column 1 of Table 2 to this

Part is,

(

a) for 2020 to 2024, the rate set out in column 3 opposite that description,

and

(

b) for each subsequent period of 5 calendar years, the rate

(

i) set for the class and period by the environment minister in accordance with

subsections (5) and (6), and

(ii) published in the Gazette by 60 days after the first day of the period.

(5) Subject to subsection (6), the threshold emissions rate under subsection (4) (

b) for a class of regulated operations and a period must be equal to the product of

(

a) the production weighted average of the emissions rates of the eligible regulated

operations in the class, and

(b) 2.

(6) The threshold emissions rate under subsection (4) (

b) for a class of regulated

operations and a period must be equal to the default threshold emissions rate for

the class and period if

(

a) the class does not yet include an eligible regulated operation, or

(

b) the threshold emissions rate determined in accordance with subsection

(5) for the class and period is lower than the target emissions rate set under subsection (2) (

b) for that class and period.

Division 2 – Regulated Operation Refund

Claiming a refund

29.36

(1) Without limiting

section 41 (1) of the Act, to claim a refund under this Part

of eligible tax in relation to a regulated operation and a calendar year, the operator

of the regulated operation must submit to the director, in accordance with subsection (2),

(

a) data sufficient for the director to determine the relevant attributable emissions

rates of the regulated operation, and

(

b) if required by the director, a signed statement of a third party acceptable

to the director verifying the completeness and accuracy of the data referred to in

paragraph (a).

(2) A claim for a refund under subsection (1) in relation to a calendar year must

(

a) submitted in the form and manner required by the director, and

(

b) received by the director by July 31 of the following calendar year.

(3) The director is not required to pay a refund under this

Part if the requirements

under subsection (1) are not met.

(4) The director is not required to pay a refund under this

Part in relation to

a calendar year until October 31 of the following calendar year.

Refund – new entrant period

29.37

(1) This

section applies to base tax in relation to a regulated operation that was

imposed in the new entrant period for the regulated operation.

(2) Subject to

section 29.36, if the director is satisfied that the operator of

a regulated operation has paid base tax in relation to the regulated operation, the

director must pay the operator a refund of the portion of the base tax paid that is

eligible tax.

Refund – after new entrant period

29.38

(1) This

section applies to base tax in relation to a regulated operation that was

imposed after the new entrant period for the regulated operation.

(2) Subject to

section 29.36, if the director is satisfied that

(

a) the operator of a regulated operation has paid base tax in relation to the

regulated operation that was imposed in a calendar year, and

(

b) the attributable emissions rate of the regulated operation for the calendar

year is less than the threshold emissions rate for that regulated operation,

the director must pay the operator a refund of the portion of the base tax paid

determined in accordance with the following formula:

amount of refund = eligible tax x RA x PA

where

eligible tax

the portion of the base tax paid that is eligible tax;

the rate adjustment determined under subsection (3) for the regulated operation

and calendar year;

the price adjustment determined under subsection (4) for the calendar year.

(3) The rate adjustment for a regulated operation and a calendar year is the following

number, as applicable:

(

a) if the attributable emissions rate of the regulated operation for the calendar

year is less than or equal to the target emissions rate for the regulated operation,

one;

(

b) in any other case, the number determined in accordance with the following

formula:

rate adjustment

1 –

attributable ER – target ER

threshold ER – target ER

where

attributable ER

the attributable emissions rate of the regulated operation for the calendar year;

target ER

the target emissions rate for the regulated operation for the calendar year;

threshold ER

the threshold emissions rate for the regulated operation for the calendar year.

(4) The price adjustment for a calendar year is,

(

a) for 2020 to 2024, one, and

(

b) for a later calendar year, the following number, as applicable:

(

i) if the global carbon price for the calendar year is greater than or equal

to the product of the notional tax rate for the calendar year and the provincial emissions

coverage for the calendar year, zero;

(ii) if the global carbon price for the calendar year is less than or equal to

the product of $30 and the provincial emissions coverage for the calendar year, one;

(iii) in any other case, the number determined in accordance with the following

formula:

price adjustment

notional tax rate x PEC – global carbon price

notional tax rate x PEC – $30 x PEC

where

notional tax rate

the notional tax rate for the calendar year;

PEC

the provincial emissions coverage for the calendar year;

global carbon price

the global carbon price for the calendar year.

Table 1

Column 1

Calendar Year

Column 2

Notional Tax Rate

$40

$45

2021 and after

$50

Table 2

Item

Column 1

Regulated Operation

Column 2 Production Unit

Column 3

Initial Threshold Emissions Rate

Column 4

Initial Target Emissions Rate

liquefied natural gas operation

tonne of liquefied natural gas

0.48

0.24

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