Commission Delegated Regulation (EU) 2019/331 of 19 December 2018 determining transitional Union-wide rules for harmonised free allocation of emission allowances pursuant to Article 10a of Directive 2003/87/EC of the European Parliament and of the Council (Text with EEA relevance)

Changes over time for: Article 18

Alternative versions:

Changes to legislation:

There are currently no known outstanding effects by UK legislation for Commission Delegated Regulation (EU) 2019/331, Article 18.

Changes to Legislation

Revised legislation carried on this site may not be fully up to date. At the current time any known changes or effects made by subsequent legislation have been applied to the text of the legislation you are viewing by the editorial team. Please see ‘Frequently Asked Questions’ for details regarding the timescales for which new effects are identified and recorded on this site.

Article 18U.K. [F1Preliminary allocation] to new entrants

[F2A1.The regulator must calculate the preliminary annual number of allowances to be allocated free of charge in respect of a new entrant for scheme years in the relevant allocation period in accordance with this Article

A2.Where the start of normal operation of a new entrant is before the date on which the permit (including a permit within the meaning of GGETSR 2012) for the installation comes into force, for the purposes of this Article and Article 18a:

(a)the start of normal operation must be treated as the date on which the permit comes into force; and

(b)the activity level of the year in which the start of normal operation occurs must be treated as the activity level of that year excluding any days before the date on which the permit comes into force.]

1.[F3Where the historical activity level of a sub-installation of the new entrant has been determined under Article 17, the preliminary annual number of allowances to be allocated free of charge in respect of the sub-installation for the first scheme year in the relevant allocation period after the year in which the start of normal operation occurs and for each subsequent scheme year in the relevant allocation period is], as follows:

(a)for each product benchmark sub-installation, heat benchmark sub-installation and fuel benchmark sub-installation, the preliminary annual number of emission allowances allocated free of charge for a given year shall correspond to the value of that benchmark for the [F4relevant [F5scheme year or] allocation period multiplied] by the relevant historical activity level F6...;

(b)for each process emissions sub-installation, the preliminary annual number of emission allowances allocated free of charge for a given year shall correspond to the process-related historical activity level multiplied by 0,97.

[F7Article 16(2a), (2b), (3), (4), (5) and (7)] shall apply mutatis mutandis to the calculation of the preliminary annual number of emission allowances allocated free of charge [F8in respect of new entrants under this paragraph and paragraph 2] [F9, but Article 16(15) to (17) does not apply to this calculation].

2.[F10Where the start of normal operation of a sub-installation of a new entrant occurs in a scheme year in the relevant allocation period, the preliminary] annual number of emission allowances allocated free of charge for the [F11scheme year] shall correspond to the value of the applicable benchmark value for each sub-installation multiplied by the activity level of that year.

[F122A.Paragraph 2 applies whether or not the historical activity level of the sub-installation has been determined under Article 17.]

[F132B.Where the benchmarks for the 2028, 2029 and 2030 scheme years have not been adopted under paragraph 9(b)(ii) on or before 30 September 2026, the calculation referred to in paragraph 1 and 2 of preliminary annual number of allowances to be allocated free of charge for the 2028, 2029 and 2030 scheme years must be undertaken by the regulator on or after 1 October 2027.

2C.Where the regulator has calculated the preliminary annual number of allowances to be allocated free of charge for a UK CBAM sub-installation for a scheme year and a different factor is subsequently provided for under Article 16(14), the regulator must recalculate the preliminary annual number of emissions allowances allocated free of charge in respect of the relevant period for the UK CBAM sub-installation in accordance with paragraph 1 or 2.

2D.In paragraph 2C “relevant period” begins with the scheme year for which the factor has changed under Article 16(14) and ends with the 2030 scheme year; but:

(a)where paragraph 2B applies and the scheme year for which the factor has changed is 2027, the relevant period refers to the 2027 scheme year; or

(b)where the scheme year for which the factor has changed is 2030, the relevant period refers to the 2030 scheme year.

2E.Where the product benchmark or the PRODCOM code of the product produced in a sub-installation that is not a UK CBAM sub-installation for the 2027-2030 allocation period is subsequently added to the relevant table in Annex 9, the regulator must carry out a recalculation in respect of the sub-installation as if paragraph 2C applied, except that the relevant period is to be read as beginning with the scheme year after the scheme year in which the product benchmark or PRODCOM code was added to the relevant table in Annex 9 and ending with the 2030 scheme year; but:

(a)where paragraph 2B applies and the scheme year after the scheme year in which the product benchmark or PRODCOM code was added to the relevant table is 2027, the relevant period refers to the 2027 scheme year; or

(b)where the scheme year after the scheme year in which the product benchmark or PRODCOM code was added to the relevant table is 2030, the relevant period refers to the 2030 scheme year.]

3.The preliminary annual amount of emission allowances allocated free of charge for each installation shall be the sum of all sub-installations' preliminary annual numbers of emission allowances allocated free of charge calculated in accordance with paragraphs 1 and 2. The second subparagraph of Article 16(6) shall apply.

F144.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F155.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.For the purpose of the calculations referred to in paragraphs [F161 to 3], the number of allowances for sub-installations and installations shall be expressed as the nearest integer [F17, taking 0.5 as nearest to the previous integer].

[F187.In this Article F19... and Article 18b, “relevant allocation period” means:

(a)in relation to an application for free allocation made under Article 5(1)(a), the 2021-2025 allocation period;

(b)in relation to an application for free allocation made under Article 5(1)(b), the [F202027-2030 allocation period or, where the start of normal operation of a new entrant is before 1st January 2027, a period consisting of the 2026 allocation period and the 2027-2030 allocation period].]

[F218.But in paragraph 1(a) of this Article and in Articles 19 to 22, as those Articles apply for the purpose of this Article, “relevant allocation period” means the allocation period containing the scheme year for which the preliminary annual number of allowances is to be calculated.]

[F229.In paragraphs 1 and 2, reference to benchmarks is to:

(a)for new entrants applying for free allocation in the 2025 scheme year, 2026 scheme year or both, in respect of the calculation of preliminary annual number of allowances for the 2025 and 2026 scheme years, the benchmarks set out in Annex 8;

(b)for new entrants applying for free allocation in the 2027-2030 allocation period:

(i)in respect of the calculation of preliminary annual number of allowances for the 2027 scheme year, the benchmarks set out in Annex 8; and

(ii)in respect of the calculation of preliminary annual number of allowances for the 2028, 2029 and 2030 scheme years, the benchmarks adopted by way of an order under Part 3 of the Climate Change Act 2008.]

Textual Amendments

F1Words in Art. 18 heading substituted (31.12.2020) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2020 (S.I. 2020/1557), art. 2(2), Sch. 1 para. 22(2)

F2Art. 18(A1)(A2) inserted (31.12.2020) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2020 (S.I. 2020/1557), art. 2(2), Sch. 1 para. 22(3)

F3Words in Art. 18(1) substituted (31.12.2020) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2020 (S.I. 2020/1557), art. 2(2), Sch. 1 para. 22(4)(a)(i)

F4Words in Art. 18(1)(a) substituted (31.3.2025) by The Greenhouse Gas Emissions Trading Scheme (Amendment) (No. 2) Order 2025 (S.I. 2025/124), arts. 2, 45(2)(a)

F5Words in Art. 18(1)(a) inserted (11.3.2026) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2026 (S.I. 2026/278), arts. 2, 22(2)

F6Words in Art. 18(1)(a) omitted (31.3.2025) by virtue of The Greenhouse Gas Emissions Trading Scheme (Amendment) (No. 2) Order 2025 (S.I. 2025/124), arts. 2, 45(2)(b)

F7Words in Art. 18(1) substituted (11.3.2026) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2026 (S.I. 2026/278), arts. 2, 22(3)(a)

F8Words in Art. 18(1)(b) substituted (31.12.2020) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2020 (S.I. 2020/1557), art. 2(2), Sch. 1 para. 22(4)(b)

F9Words in Art. 18(1) inserted (11.3.2026) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2026 (S.I. 2026/278), arts. 2, 22(3)(b)

F10Words in Art. 18(2) substituted (31.12.2020) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2020 (S.I. 2020/1557), art. 2(2), Sch. 1 para. 22(5)(a)

F11Words in Art. 18(2) substituted (31.12.2020) by The Greenhouse Gas Emissions Trading Scheme (Amendment) Order 2020 (S.I. 2020/1557), art. 2(2), Sch. 1 para. 22(5)(b)