Canadian Greenhouse Gas Offset Credit System Regulations — 40
Evaluation of reversal 40 (1) Following receipt of the reversal report, the Minister must determine whether the cause of the reversal was within the control of the proponent and whether there was a failure to implement a reversal risk management plan. Voluntary reversal (2) If the Minister determines that the cause of the reversal was within the control of the proponent or there was a failure to implement a reversal risk management plan, 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 in respect of which the reversal occurred and a number of offset credits in the environmental integrity account equal to the number of offset credits deposited into that account in respect of the project; (b) if 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) where the proponent does not remit compliance units in accordance with subparagraph (i) or make a payment in lieu 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; and (c) cancel the registration of the project in accordance with paragraph 14 (1)(e). Manner of remittance (3) Subject to subsection (4), the compliance units remitted to the Minister under subparagraph (2)(b)(i), in accordance with subsection 181(2) of the Act, must (a) in the case of offset credits or units or credits recognized by a regulation made under the Act, have been issued for GHG reductions that occurred within the 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 to the proponent. Surplus credits (4) In the case where 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 in the calendar year the Minister notified the proponent under subparagraph (2)(b)(i) of the requirement to remit compliance units. Involuntary reversal (5) If the Minister determines that the cause of the reversal was not within the proponent’s control and there was no failure to implement the reversal risk management plan, the Minister may (a) lift any suspension; (b) revoke, for the purposes of section 180 of the Act, the number of offset credits in the environmental integrity account that corresponds to the lesser of the quantity of the GHGs released into the atmosphere during the reversal and the quantity of offset credits that have been issued in respect of the project; and (c) if applicable, cancel the registration of the project in accordance with paragraph 14 (1)(f).