340-253-1000 Credit and Deficit Basics (1) Carbon intensities. (a) Except as provided in subsections (b), (c), or (d), when calculating carbon intensities, registered parties must use the carbon intensity approved by DEQ under OAR 340-253-0450 for a given fuel. (b) If a fuel pathway holder, which may be a registered party, has a provisional carbon intensity approved under OAR 340-253-0450 for a fuel, the registered parties reporting that fuel must use the DEQ-approved provisional carbon intensity. (c) If a fuel pathway holder or a registered party has a temporary carbon intensity approved under OAR 340-253-0450 for a fuel, the party reporting that fuel must use the temporary carbon intensity for the period which it has been approved, unless DEQ has subsequently approved a permanent carbon intensity for that fuel. (d) If a registered party purchases a blended finished fuel and the seller does not provide carbon intensity information, then the registered party must: (A) Use the applicable substitute fuel pathway code in Table 8 under OAR 340-253-8010 or a fuel pathway code that has been otherwise approved and posted by DEQ under OAR 340-253-0450(12) if the fuel is exported, not used for transportation, or used in an exempt fuel use; and (B) Report the volume using the applicable Table 8 fuel pathway code, or a fuel pathway code that has been otherwise approved and posted by DEQ under OAR 340-253-0450(12), for the fossil fuel and the applicable substitute fuel pathway code for the biofuel or biofuels if the finished fuel blend is not listed. (2) Fuel quantities. Registered parties must express fuel quantities in the unit for each fuel according to the temperature correction requirements in OAR 340-253-0640(4) for liquid fuels, or according to accurate metering for all other fuels when they are dispensed into the vehicle or other qualifying equipment. If the fuel cannot be accurately metered at the point of dispensation, DEQ may approve an alternative methodology and all registered parties reporting in that circumstance must use that methodology. (3) Compliance period. The annual compliance period under this division is January 1 through December 31 of each year. (4) Metric tons of CO2 equivalent. In all reporting and transactions under this division, registered parties must express credits and deficits to the nearest whole metric ton of carbon dioxide equivalent. (5) Deficit generation. Under this division: (a) Deficits are generated at the time that a valid and accurate quarterly report is submitted in the OFRS; (b) Deficits are generated for fuel that is produced, imported, or dispensed for use in Oregon, as applicable, and the carbon intensity of the fuel, as approved for use under OAR 340-253-0400 through -0470, is more than the clean fuel standard for gasoline and gasoline substitutes in Table 1 under OAR 340-253-8010 or for diesel fuel and diesel substitutes in Table 2 under 340-253-8010, as applicable; (c) Each deficit is a separate denomination of the regulatory obligations of this program on the registered party; and (d) Deficits may be generated by any registered party as a result of its reporting or assigned to a registered party by DEQ under OAR 340-253-0670. (6) Credit generation. Under this division: (a) Credits are generated at the time that a valid and accurate quarterly report is submitted in the OFRS; (b) Credits are a regulatory instrument and do not constitute personal property, instruments, securities or any other form of property; and (c) No credits may be generated or claimed for any transactions or activities occurring in a quarter for which the quarterly reporting deadline has passed, unless the credits are being generated for residential charging of electric vehicles, or for claiming incremental credits by a utility or the incremental aggregator, or for DEQ calculating any contribution of credits to the reserve account established under OAR 340-253-1060. (7) Mandatory retirement of credits. All registered parties must comply with the clean fuels standards by retiring credits against any deficits they hold when filing the annual report at the end of a compliance period. Any registered party that possesses deficits on its annual report must retire a sufficient number of credits such that: (a) Enough credits are retired to completely meet the registered party’s compliance obligation as denominated in deficits for that compliance period, or (b) If the total number of the registered party’s credits is less than the total number of the regulated party’s deficits, the registered party must retire all of its credits. (c) Credit Retirement Hierarchy. The OFRS will use the following default hierarchy to retire credits for the purposes of meeting a compliance obligation: (A) Credits acquired or generated in a previous compliance period will be retired prior to credits generated or acquired in the current compliance period; (B) Credits with an earlier completed transfer “recorded date” will be retired prior to credits with a later completed transfer “recorded date;” and (C) Credits generated in an earlier quarter will be retired prior to credits generated in a later quarter. Statutory/Other Authority: ORS 468.020, 468A.266, 468A.268 & 468A.277 Statutes/Other Implemented: ORS 468.020 & ORS 468A.265 - 468A.277 History: DEQ 2-2025, amend filed 01/09/2025, effective 01/09/2025 DEQ 17-2022, amend filed 09/23/2022, effective 01/01/2023 DEQ 7-2021, amend filed 03/26/2021, effective 03/26/2021 DEQ 14-2020, amend filed 05/07/2020, effective 05/07/2020 DEQ 199-2018, amend filed 11/16/2018, effective 01/01/2019 DEQ 27-2017, amend filed 11/17/2017, effective 11/17/2017 DEQ 13-2015, f. 12-10-15, cert. ef. 1-1-16 DEQ 3-2015, f. 1-8-15, cert. ef. 2-1-15 DEQ 8-2012, f. & cert. ef. 12-11-12