|Major overhaul of the California cap-and-trade - linkage with the Quebec scheme and the KYC-checks substitution for the beneficial holding disclosure provisions - Page 3|
|Thursday, 05 April 2012 19:04|
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When it comes to technical issues, the amended rules provide that the administrator of the approved external GHG ETS must agree to inform the ARB Executive Officer of the serial numbers of any California compliance instruments that the external GHG ETS accepts for compliance and the ARB Executive Officer will agree to inform the appropriate official in the approved external GHG ETS of the serial numbers of any compliance instrument accepted by California for compliance.
But the reciprocity is not secured in its entirety. One of the instances is the issue of the access to the sale of allowances from the Allowance Price Containment Reserve (the detailed rules for the functioning of the Reserve are analysed in The Cost Containment Mechanisms in the California Cap-and-Trade Program – why absent in the EUETS? .
There has been the rule so far that if California links to an external greenhouse gas emissions trading system (GHG ETS), the linkage agreement will specify whether covered entities in the linked GHG ETS will be eligible to purchase from a jointly operated Reserve, or whether each GHG ETS will operate separate Reserves.
This alternative is resolved in the proposed amendments in favor of the latter option and now the provision is inserted stating clearly that if California links to an external GHG ETS, entities registered in the linked GHG ETS will not be eligible to purchase from the Reserve.
This is underlined in the next passage of the new rules providing that only entities registered into the California GHG cap-and-trade system are eligible to purchase allowances from the Reserve.