On-Road Vehicle and Engine Emission Regulations (SOR/2003-2)

Cold NMHC Emission Credits

• 26.2 (1) For the purposes of subparagraph 162(1)(b)(i) of the Act, a company shall obtain cold NMHC emission credits for its fleets of the 2017 and later model years if the average cold NMHC value in respect of a fleet of a specific model year is lower than the fleet average cold NMHC standard for the model year in question and the company reports the credits in its end of model year report.

• (2) Cold NMHC emission credits, expressed in units of vehicle-grams per mile, shall be calculated using the following formula, rounding the result to the nearest whole number:

  (A – B) × C

  where

  A

  is the fleet average cold NMHC standard;

  B

  is the average cold NMHC value in respect of the fleet; and

  C

  is the total number of vehicles in the fleet.

• (3) The cold NMHC emission credits for a specific model year are credited on the last day of the model year in question.

Evaporative Emission Credits

• 26.3 (1) For the purposes of subparagraph 162(1)(b)(i) of the Act, a company shall obtain evaporative emission credits for its fleets of the 2017 and later model years if the average evaporative emission value in respect of a fleet of a specific model year is lower than the fleet average evaporative emission standard for the model year in question and the company reports the credits in its end of model year report.

• (2) Evaporative emission credits, expressed in units of vehicle-grams per mile, shall be calculated using the following formula, rounding the result to the nearest whole number:

  (A – B) × C

  where

  A

  is the fleet average evaporative emission standard;

  B

  is the average evaporative emission value in respect of the fleet; and

  C

  is the total number of vehicles in the fleet.

• (3) The evaporative emission credits for a specific model year are credited on the last day of the model year in question.

Early Action NMOG + NO_X Emission Credits

• 26.4 (1) A company may obtain early action credits in respect of its fleet that is composed of all of its light-duty vehicles and light-duty trucks 1 of the 2015 or 2016 model year if the average NMOG + NO_X value in respect of the fleet of the model year in question is lower than 0.16 grams per mile and the company reports the credits in its 2017 end of model year report.

• (2) Early action credits obtained in respect of the fleet are calculated in accordance with subsection 26.1(2), except that the fleet average NMOG + NO_X standard in the description of A is 0.16 grams per mile.

• (3) Early action credits obtained for the 2015 and 2016 model years are credited on the day on which the company’s 2017 end of model year report is submitted.

• (4) Early action credits obtained for the 2015 and 2016 model years may be used as of the 2017 model year but only in respect of a fleet that is composed of all of the company’s light-duty vehicles and light-duty trucks 1 of any of the five model years after the model year in respect of which the credits were credited, after which the credits are no longer valid.

• 26.5 (1) A company may obtain early action credits in respect of its fleet that is composed of all of its light-duty trucks 2, heavy light-duty trucks and medium-duty passenger vehicles of the 2016 or 2017 model year if the average NMOG + NO_X value in respect of the fleet of the model year in question is lower than 0.16 grams per mile and the company reports the credits in its 2018 end of model year report.

• (2) Early action credits obtained in respect of the fleet are calculated in accordance with subsection 26.1(2), except that the fleet average NMOG + NO_X standard in the description of A is 0.16 grams per mile.

• (3) Early action credits obtained for the 2016 and 2017 model years are credited on the day on which the company’s 2018 end of model year report is submitted.

• (4) Early action credits obtained for the 2016 and 2017 model years may be used as of the 2018 model year but only in respect of a fleet that is composed of all of the company’s light-duty trucks 2, heavy light-duty trucks and medium-duty passenger vehicles of any of the five model years after the model year in respect of which the credits were credited, after which the credits are no longer valid.

• 26.6 (1) A company may obtain early action credits in respect of its fleet that is composed of all of its Class 2B vehicles or all of its Class 3 vehicles of the 2016 or 2017 model year if the average NMOG + NO_X value in respect of a fleet of the model year in question is lower than the applicable fleet average NMOG + NO_X standard for the model year in question set out in Table 4 of section 1816 of Title 40, chapter I, subchapter C, part 86, subpart S, of the CFR and the company reports the credits in its 2018 end of model year report.

• (2) Early action credits obtained in respect of the fleet are calculated in accordance with subsection 26.1(2).

• (3) Early action credits obtained for the 2016 and 2017 model years are credited on the day on which the company’s 2018 end of model year report is submitted.

• (4) Early action credits obtained for the 2016 and 2017 model years may be used as of the 2018 model year but only in respect of a fleet that is composed of all of the company’s Class 2B vehicles or all of its Class 3 vehicles of any of the five model years after the model year in respect of which the credits were credited, after which the credits are no longer valid.

Emission Deficit

• 27 (1) Subject to subsection (2), NO_X, NMOG + NO_X, cold NMHC or evaporative emission credits, as the case may be, obtained in respect of a fleet of a specific model year shall be used by the company to offset any NO_X, NMOG + NO_X, cold NMHC or evaporative emission deficit, as the case may be, referred to in section 28, and any remaining credits may be used to offset a future deficit or, except in the case of early action credits, may be transferred to another company.

• (2) NO_X emission credits obtained in respect of a fleet of a specific model year may only be used to offset a NO_X emission deficit for the 2017 model year or an earlier model year.

28 Subject to section 31 or 31.1, if a company’s average NO_X, NMOG + NO_X, cold NMHC or evaporative emission value, as the case may be, in respect of a fleet of a specific model year is higher than the fleet average NO_X, NMOG + NO_X, cold NMHC or evaporative emission standard for the model year in question, the company shall calculate the value of the NO_X, NMOG + NO_X, cold NMHC or evaporative emission deficit incurred in that model year using the formula set out in subsection 26(2), 26.1(2), 26.2(2) or 26.3(2), as the case may be.

• 29 (1) Subject to subsection 27(2), a company shall offset a NO_X emission deficit no later than the date on which the company submits the end of model year report for the third model year after the model year in which the deficit was incurred.

• (2) Subject to subsection (3), a company may offset a NOx emission deficit with an equivalent number of NOx emission credits obtained in accordance with section 26 or obtained from another company.

• (3) If any part of a NOx emission deficit for a specific model year is outstanding following the submission of the end of model year report for the second model year after the model year in which the deficit was incurred, the number of NOx emission credits required to offset that outstanding deficit in the next model year is 120% of the deficit.

• 29.1 (1) A company shall offset a NMOG + NO_X, cold NMHC or evaporative emission deficit no later than the date on which the company submits the end of model year report for the third model year after the model year in which the deficit was incurred.

• (2) A company may offset a NMOG + NO_X, cold NMHC or evaporative emission deficit with an equivalent number of NMOG + NO_X, cold NMHC or evaporative emission credits, as the case may be, obtained in accordance with section 26.1, 26.2 or 26.3 or obtained from another company.

• 30 (1) A company that acquires another company or that results from a merger of companies is responsible for offsetting, in accordance with section 29 or 29.1, any emission deficits of the acquired company or merged companies.

• (2) In the case of a company that ceases to manufacture, import or sell light-duty vehicles, light-duty trucks, medium-duty passenger vehicles, Class 2B vehicles or Class 3 vehicles, the company shall, no later than three calendar years after submitting its last end of model year report, offset all emission deficits that are outstanding at the time that it ceases those activities.

Election for Vehicles Covered by an EPA Certificate

• 31 (1) Subject to subsection (8), a company may elect to exclude the group of vehicles in a fleet that are covered by an EPA certificate and that are sold concurrently in Canada and the United States from the requirement to meet the standards set out in section 21, 22 or 23, as the case may be, and from the NO_X emission deficit calculations in respect of a fleet under section 28.

• (2) Subject to subsection (3), a company shall include in the group referred to in subsection (1) all of the vehicles of the fleet that are covered by an EPA certificate and that are sold concurrently in Canada and the United States.

• (3) A company shall not include in the group referred to in subsection (1) any vehicle that is covered by an EPA certificate and

  • (a) in respect of which the total number of units sold in Canada exceeds the total number of units sold in the United States that are covered by the same EPA certificate; and

  • (b) that conforms to a full useful life emission bin having a NOx standard that is greater than the applicable fleet average NOx standard for the model year in respect of which the election is made.

• (4) Subject to subsection (5), if a company makes an election under subsection (1), it shall calculate an average NOx value in accordance with section 24, with the necessary modifications, in respect of

  • (a) the group that is subject to the election; and

  • (b) the vehicles in the fleet that are not part of the group referred to in paragraph (a), if any.

• (5) A company may elect not to make the calculations referred to in subsection (4) for a group of vehicles described in paragraph (4)(a) or (b) if every vehicle in the group conforms to a full useful life emission bin having a NOx standard equal to or less than the fleet average NOx standard that would otherwise apply under section 21, 22 or 23, as the case may be.

• (6) If a company makes an election under subsection (5) the average NOx emission value for the group of vehicles of a fleet for which the election was made shall be the applicable fleet average NOx standard.

• (7) If a company makes the election referred to in subsection (1) and the average NOx value for the group that is subject to the election, calculated under paragraph (4)(a) exceeds the fleet average NOx standard that would otherwise apply under section 21, 22 or 23, as the case may be, the company shall

  • (a) forfeit any NOx emission credits obtained in previous model years; and

  • (b) not obtain any NOx emission credits in the model year in respect of which the election was made.

• (8) A company shall not make the election referred to in subsection (1) in respect of a model year in which it has transferred NO_X emission credits to another company if the average NO_X value calculated under paragraph (4)(a) for the group that is subject to the election exceeds the fleet average NO_X standard that would otherwise apply under section 21, 22 or 23, as the case may be.

• 31.1 (1) Subject to subsection (8), a company may elect to exclude the group of vehicles in a fleet that are covered by an EPA certificate and that are sold concurrently in Canada and the United States from the requirement to meet the standards set out in sections 24.1 to 24.4, 24.6, 24.7 and 24.10, as applicable, and from the NMOG + NO_X, cold NMHC or evaporative emission deficit calculations, as the case may be, in respect of a fleet under section 28.

• (2) Subject to subsection (3), a company shall include in the group referred to in subsection (1) all of the vehicles of a fleet that are covered by an EPA certificate and that are sold concurrently in Canada and the United States.

• (3) A company shall not include in the group referred to in subsection (1) any vehicle that is covered by an EPA certificate and

  • (a) in respect of which the total number of units sold in Canada exceeds the total number of units sold in the United States that are covered by the same EPA certificate; and

  • (b) that conforms, as applicable, to

    • (i) a full useful life emission bin having a NMOG + NO_X standard that is greater than the applicable fleet average NMOG + NO_X standard for the model year in respect of which the election is made, or

    • (ii) a family emission limit for cold NMHC or evaporative emissions, as the case may be, that is greater than the applicable fleet average cold NMHC or evaporative emission standard for the model year in respect of which the election is made.

• (4) Subject to subsection (5), if a company makes an election under subsection (1), it shall calculate an average NMOG + NO_X, cold NMHC or evaporative emission value in accordance with section 24.5, 24.8 or 24.11, as the case may be, with the necessary modifications, in respect of

  • (a) the group that is subject to the election; and

  • (b) the vehicles in the fleet that are not part of the group referred to in paragraph (a), if any.

• (5) A company may elect not to make the calculations referred to in subsection (4) for a group of vehicles described in paragraph (4)(a) or (b) if every vehicle in the group conforms to

  • (a) a full useful life emission bin having a NMOG + NO_X standard that is equal to or less than the fleet average NMOG + NO_X standard that would otherwise apply under sections 24.1 to 24.4; or

  • (b) a family emission limit for cold NMHC or evaporative emissions, as the case may be, that is equal to or less than the fleet average cold NMHC or evaporative emission standard that would otherwise apply under section 24.6, 24.7 or 24.10.

• (6) If a company makes an election under subsection (5), the average NMOG + NO_X, cold NMHC or evaporative emission value, as the case may be, for the group of vehicles of a fleet for which the election was made shall be the applicable fleet average NMOG + NO_X, cold NMHC or evaporative emission standard.

• (7) If a company makes the election referred to in subsection (1) and the average NMOG + NO_X, cold NMHC or evaporative emission value, as the case may be, for the group that is subject to the election, calculated under paragraph (4)(a), exceeds the fleet average NMOG + NO_X, cold NMHC or evaporative emission standard that would otherwise apply under section 24.1, 24.2, 24.3, 24.4, 24.6, 24.7 or 24.10, the company shall

  • (a) forfeit any NMOG + NO_X, cold NMHC or evaporative emission credits, as the case may be, obtained for previous model years; and

  • (b) not obtain any NMOG + NO_X, cold NMHC or evaporative emission credits, as the case may be, for the model year in respect of which the election was made.

• (8) A company shall not make an election referred to in subsection (1) in respect of any of the following emission standards for a model year in respect of which it has transferred emission credits to another company if

  • (a) in the case of NMOG + NO_X standards, the average NMOG + NO_X value, calculated under paragraph (4)(a) for the group that is subject to the election, exceeds the fleet average NMOG + NO_X standard that would otherwise apply under section 24.1, 24.2, 24.3 or 24.4;

  • (b) in the case of cold NMHC standards, the average cold NMHC value, calculated under paragraph (4)(a) for the group that is subject to the election, exceeds the fleet average cold NMHC standard that would otherwise apply under section 24.6 or 24.7; or

  • (c) in the case of evaporative emissions standards, the average evaporative emission value, calculated under paragraph (4)(a) for the group that is subject to the election, exceeds the fleet average evaporative emission standard that would otherwise apply under section 24.10.