# Output-Based Pricing System Regulations

Marginal note:Calculated output-based standard

**37**(1) Subject to subsection (3) and sections 38 to 40, the output-based standard that is applicable to a specified industrial activity of a covered facility for which an output-based standard must be calculated is determined by the formulaThe quotient where the numerator is the summation of A minus B and minus C for each reference year “i”, and the denominator is the summation of Di for each reference year “i”, and then multiplied by Ewhere

- A
- is the total quantity of GHGs from the covered facility for reference year “i”, determined in accordance with section 17, expressed in CO
_{2}e tonnes; - B
- is the allocation for net thermal energy for reference year “i” and is
(a) determined by the formula

0.062 CO

_{2}e tonnes/gigajoules × (M − N) × Owhere

- M
- is the quantity of thermal energy produced by the covered facility that was sold to another covered facility in reference year “i”, determined by the quantity of thermal energy on sales receipts or by another objective method, expressed in gigajoules,
- N
- is the quantity of thermal energy that was bought from another covered facility in reference year “i”, as determined by the quantity of thermal energy on sales receipts or by another objective method, expressed in gigajoules, and
- O
- is the ratio of heat from the combustion of fossil fuels to produce thermal energy for reference year “i” and is
(a) if M is greater than N, the ratio of heat determined under section 34 for reference year “i” for the covered facility, or

(b) if M is less than N, the ratio of heat determined under section 34 for reference year “i” for the covered facility from which the thermal energy was purchased, or

(b) 0 for all reference years if the quotient obtained by dividing the sum of the results determined under paragraph (a) for each reference year “i” by the number of reference years is less than the quotient obtained by dividing the result of the following formula by the number of reference years:

0.015 × A

- C
- the total quantity of GHGs from all specified industrial activities engaged in at the facility, for reference year “i”, other than the industrial activity for which the output-based standard is being calculated, determined in accordance with sections 17 and 18, for each of those activities;
- D
- is the production from a covered facility from the industrial activity for which the output-based standard is being calculated, for reference year “i”, quantified in accordance with section 31;
- E
- is the GHG emissions reduction factor applicable to the specified industrial activity for which the output-based standard is being calculated and is
(a) 95% for a specified industrial activity set out in paragraphs 7(c), 8(b) and (c), and 20(d), column 1, of Schedule 1,

(b) 90% for a specified industrial activity set out in item 22 and paragraphs 23(a) and 29(d), column 1, of Schedule 1, and

(c) 80% for all other specified industrial activities; and

- i
- is the i
^{th}reference year, where “i” goes from 1 to n and where n is the number of reference years, determined in accordance with subsection (2).

Marginal note:Reference years

(2) The reference years applicable to the specified industrial activities set out in column 1 of Schedule 1 that are engaged in at a covered facility for which an emissions limit is calculated for a compliance period are

(a) except for a covered facility referred to in paragraph (b), at the choice of the responsible person, either,

(i) the 2017 and 2018 calendar years, or

(ii) the compliance period; or

(b) for a covered facility for which an emissions limit is being calculated for the first time but for which the person responsible has submitted an annual report under these Regulations for a previous compliance period without including the information referred to in paragraphs 11(1)(e) and (f) in accordance with subsection 11(2), either

(i) the two calendar years preceding the compliance period for which the emissions limit is calculated, if the data are available for those years,

(ii) the calendar year preceding the compliance period for which the emissions limit is calculated, if the data are not available for the two calendar years referred to in (i), or

(iii) the compliance period for which the emissions limit is being calculated, if that data are not available for those preceding calendar years.

Marginal note:Thermal energy allocation

(3) For the purposes of subsection (1), if an output-based standard must be calculated with respect to a covered facility for more than one specified industrial activity, the allocation for net thermal energy can only be deducted from one of those calculations.

Marginal note:Rounding

(4) The result from the calculation under subsection (1) is rounded to three significant figures.

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