The Greenhouse Gas Emissions Trading Scheme Order 2020

PART 4 Emissions targets

Emissions targets other than for hospital-qualifying installations may not exceed maximum amount

15.—(1) Except in the case of a hospital-qualifying installation, an emissions target for a scheme year may not exceed the maximum amount.

(2) This paragraph overrides paragraphs 16 and 17.

Emissions targets for 2021-2025 allocation period

16.—(1) This paragraph applies for the purpose of calculating an installation’s emissions targets for the scheme years in the 2021-2025 allocation period under paragraph 11(1)(f)(i) and (iii).

(2) Where a regulated activity began to be carried out at the installation before 2019, the installation’s emissions target for a scheme year is the installation’s relevant emissions multiplied by the reduction factor for the scheme year.

(3) For the purpose of sub-paragraph (2), the relevant emissions of an installation are—

(a) where a regulated activity began to be carried out at the installation before 2016, the sum of the installation’s reportable emissions in 2016, 2017 and 2018 divided by 3;

(b) where a regulated activity began to be carried out at the installation in 2016, the sum of the installation’s reportable emissions in 2017 and 2018 divided by 2;

(c) where a regulated activity began to be carried out at the installation in 2017, the installation’s reportable emissions in 2018;

(d) where a regulated activity began to be carried out at the installation in 2018, the installation’s reportable emissions in 2019.

(4) Where a regulated activity began to be carried out at the installation in 2019, the installation’s emissions target—

(a) for the 2021 scheme year is the 2021 estimate multiplied by the reduction factor for the 2021 scheme year;

(b) for every other scheme year (the “relevant scheme year”) in the 2021-2025 allocation period is the installation’s reportable emissions in 2020 multiplied by the reduction factor for the relevant scheme year.

(5) Where a regulated activity began to be carried out at the installation in the period beginning on 1st January 2020 and ending on 31st October 2020, the installation’s emissions target—

(a) for the 2021 scheme year is the 2021 estimate multiplied by the reduction factor for the 2021 scheme year;

(b) for the 2022 scheme year is the 2021 estimate multiplied by the reduction factor for the 2022 scheme year;

(c) for every other scheme year (the “relevant scheme year”) in the 2021-2025 allocation period is the installation’s reportable emissions in the 2021 scheme year multiplied by the reduction factor for the relevant scheme year.

(6) In sub-paragraphs (4) and (5), “2021 estimate” means the conservative estimate of annual average emissions referred to in Article 19(4) of the Monitoring and Reporting Regulation 2012 used for the purposes of a monitoring plan submitted under that Regulation and contained in the application for a permit under GGETSR 2012 (see paragraph 1(1)(f) of Schedule 4 to GGETSR 2012).

(7) For the purpose of this paragraph, the reduction factor for a scheme year set out in column 1 of table D is the value set out in the corresponding entry in column 2.

Table D

Column 1	Column 2
Scheme year	Reduction factor
2021	0.8697
2022	0.8461
2023	0.8224
2024	0.7988
2025	0.7751

(8) In this paragraph, a reference to reportable emissions is a reference to reportable emissions (within the meaning of GGETSR 2012 or this Order)—

(a) verified in accordance with the Verification Regulation 2012 or the Verification Regulation 2018;

(b) where relevant, set out in an emissions report accompanied by the notice or declaration referred to in paragraph 3(8)(b)(ii) of Schedule 5 to GGETSR 2012 or paragraph 11(2)(b)(ii) of this Schedule.

(9) This paragraph is subject to paragraph 14.

Emissions targets for 2026-2030 allocation period

17.—(1) This paragraph applies for the purpose of calculating an installation’s emissions targets for the scheme years in the 2026-2030 allocation period under—

(a) paragraph 11(1)(f)(ii) and (iv);

(b) paragraph 21.

(2) Where a regulated activity begins to be carried out at the installation before 2024, the installation’s emissions target for a scheme year is the installation’s relevant emissions multiplied by the reduction factor for the scheme year.

(3) For the purpose of sub-paragraph (2), the relevant emissions of an installation are—

(a) where a regulated activity begins to be carried out at the installation before 2021, the sum of the installation’s reportable emissions in 2021, 2022 and 2023 divided by 3;

(b) where a regulated activity begins to be carried out at the installation in 2021, the sum of the installation’s reportable emissions in 2022 and 2023 divided by 2;

(c) where a regulated activity begins to be carried out at the installation in 2022, the installation’s reportable emissions in 2023;

(d) where a regulated activity begins to be carried out at the installation in 2023, the installation’s reportable emissions in 2024.

(4) Where a regulated activity begins to be carried out at the installation in 2024, the installation’s emissions target—

(a) for the 2026 scheme year is the 2026 estimate multiplied by the reduction factor for the 2026 scheme year;

(b) for every other scheme year (the “relevant scheme year”) in the 2026-2030 allocation period is the installation’s reportable emissions in the 2025 scheme year multiplied by the reduction factor for the relevant scheme year.

(5) Where a regulated activity begins to be carried out at the installation in the period beginning on 1st January 2025 and ending on 31st October 2025, the installation’s emissions target—

(a) for the 2026 scheme year is the 2026 estimate multiplied by the reduction factor for the 2026 scheme year;

(b) for the 2027 scheme year is the 2026 estimate multiplied by the reduction factor for the 2027 scheme year;

(c) for every other scheme year (the “relevant scheme year”) in the 2026-2030 allocation period is the installation’s reportable emissions in the 2026 scheme year multiplied by the reduction factor for the relevant scheme year.

(6) In sub-paragraphs (4) and (5), “2026 estimate” means the estimate of the installation’s reportable emissions in the 2026 scheme year provided under—

(a) in the case of a hospital-qualifying installation, paragraph 6(3)(b);

(b) in any other case, paragraph 6(6).

(7) For the purpose of this paragraph, the reduction factor for a scheme year set out in column 1 of table E is the value set out in the corresponding entry in column 2.

Table E

Column 1	Column 2
Scheme year	Reduction factor
2026	0.8882
2027	0.8602
2028	0.8322
2029	0.8043
2030	0.7763

(8) In this paragraph, a reference to reportable emissions is a reference to reportable emissions—

(a) verified in accordance with the Verification Regulation 2018; or

(b) where relevant, set out in an emissions report accompanied by the declaration referred to in paragraph 11(2)(b)(ii).

(9) This paragraph is subject to paragraph 14.

Emissions targets: calculation of later targets where initial targets based on estimates

18.—(1) This paragraph applies where an installation’s emission targets for the scheme years in an allocation period are required to be calculated under—

(a) paragraph 16(4) or (5);

(b) paragraph 17(4) or (5).

(2) Paragraph 11(1)(f)(i) and (ii) do not require the installation’s hospital or small emitter permit to contain emissions targets for scheme years (the “relevant scheme years”) for which, at the date of issue of the permit, the information required to calculate the emission targets is not available.

(3) As soon as reasonably practicable after the information to calculate the installation’s emissions targets for the relevant scheme years becomes available, the regulator must vary the installation’s hospital or small emitter permit under paragraph 6 of Schedule 6 by adding the emissions targets.

(4) But sub-paragraph (3) does not apply if the regulator has given a conversion notice to the operator of the installation, the effect of which is that the installation will not be a hospital or small emitter for the relevant scheme years.

Emissions targets: hospital or small emitters must not exceed targets

19.—(1) The operator of an installation must ensure that the installation’s reportable emissions in a scheme year for which the installation is a hospital or small emitter do not exceed the emissions target for that year.

(2) This paragraph is subject to paragraph 14.

Emissions targets: banking overachieved target

20.—(1) In this paragraph, an installation’s “bankable amount”, in relation to a scheme year, means ET – RE, where—

ET is the installation’s emissions target for that year;

RE is the reportable emissions stated in the installation’s emissions report for that year.

(2) But if the installation’s emissions target for a scheme year is calculated in accordance with any of the following provisions (emissions targets based on estimates), for the purposes of this paragraph the installation’s bankable amount for that scheme year must be treated as zero—

(a) paragraph 16(4)(a);

(b) paragraph 16(5)(a) or (b);

(c) paragraph 17(4)(a);

(d) paragraph 17(5)(a) or (b).

(3) Subject to sub-paragraphs (5) and (6), where an installation’s bankable amount for a scheme year (the “scheme year in question”) is greater than zero—

(a) the regulator may increase the installation’s emissions target for the following scheme year (the “next scheme year”) by the bankable amount; and

(b) if the regulator does so, the regulator must vary the installation’s hospital or small emitter permit under paragraph 6 of Schedule 6 by substituting the increased emissions target for the existing target.

(4) Subject to sub-paragraph (6), where the amount of reportable emissions stated in the installation’s emissions report for the scheme year in question is amended following a determination of emissions under article 45, the regulator must—

(a) calculate the bankable amount for the scheme year in question as if RE in sub-paragraph (1) were the amount of reportable emissions for that year as amended following the determination; and

(b) where an increased emissions target for the next scheme year has been substituted under sub-paragraph (3)(b), further vary the permit under paragraph 6 of Schedule 6 by substituting a revised emissions target for that year, based on the revised calculation of the bankable amount under paragraph (a).

(5) Sub-paragraph (3) does not apply if the scheme year in question is—

(a) the 2025 scheme year;

(b) the 2030 scheme year.

(6) Except where the installation is a hospital-qualifying installation, if increasing the emissions target for the next scheme year would result in an emissions target that exceeds the maximum amount, the emissions target must be increased by such amount as results in an emissions target of the maximum amount.

Emissions targets: targets for 2026-2030 allocation period for hospital or small emitters in 2021-2025 allocation period

21.—(1) This paragraph applies where—

(a) a hospital or small emitter permit is in force for an installation that contains emissions targets for a scheme year in the 2021-2025 allocation period; and

(b) the installation is included in the hospital and small emitter list for 2026-2030.

(2) The regulator must, on or before 31st December 2025—

(a) calculate an emissions target for the installation for each scheme year in the 2026-2030 allocation period; and

(b) vary the installation’s hospital or small emitter permit under paragraph 6 of Schedule 6 to include those emissions targets.

(3) But sub-paragraph (2) does not apply if the regulator has given a conversion notice to the operator of the installation (the effect of which is that the installation will not be a hospital or small emitter for the scheme years in the 2026-2030 allocation period).

Emissions targets: errors

22.—(1) This paragraph applies where the amount of an installation’s reportable emissions used to calculate the installation’s emission targets (including revised emissions targets under paragraph 20) for scheme years in an allocation period is amended following a determination of emissions under article 45.

(2) The regulator may calculate revised emissions targets for the current and future scheme years in the allocation period and, if the regulator does so, the regulator must vary the installation’s hospital or small emitter permit under paragraph 6 of Schedule 6 to include those emissions targets.

(3) In calculating revised emissions targets under sub-paragraph (2), the regulator may take account of what revised emissions targets for past scheme years in the allocation period calculated under this paragraph might have been if the determination had been made earlier (but may not calculate revised emissions targets for past years).

(4) In this paragraph—

(a) a reference to reportable emissions used to calculate emissions targets for the 2021-2025 allocation period includes a reference to reportable emissions within the meaning of GGETSR 2012; and

(b) a reference to a determination of emissions under article 45 includes, in the case of reportable emissions referred to in paragraph (a), a reference to a determination of emissions under regulation 44(3) of GGETSR 2012 or Article 70(1) of the Monitoring and Reporting Regulation 2012.