Paragraph 1

For the purpose of this Schedule—

• “the 2010 Regulation” means Commission Regulation (EU) No 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community^f1;

• “allowance” has the meaning given in Article 3(a) of the Emissions Trading Directive, but excludes an aviation allowance; and

• “aviation allowance” means any allowance allocated in accordance with Article 3(e) or 3(f) of the Emissions Trading Directive or auctioned in accordance with Article 3(d) of that Directive.

The annual allocation (“AA”), for a year of the 2013–2017 budgetary period (“Year Y”), expressed in tonnes of carbon dioxide equivalent, is calculated as follows—

$$\text{AA}=\text{A}+\text{B}+\text{(}\frac{\text{A}}{\text{C}}\times \text{D}\times \text{0}\text{.05)}$$

where—

1. (a)

   A is the total quantity of allowances for installations in the United Kingdom for Year Y, as stated in the list published pursuant to regulation 16(6) of the Greenhouse Gas Emissions Trading Scheme Regulations 2012^f2;

2. (b)

   B is the total quantity of allowances auctioned by the United Kingdom in respect of installations in the United Kingdom for Year Y, in accordance with the provisions of Article 10(2) of the Emissions Trading Directive and Article 10(2) of the 2010 Regulation;

3. (c)

   C is the total quantity of allowances freely allocated European Union-wide for Year Y, as calculated in accordance with Article 10(a) of the Emissions Trading Directive; and

4. (d)

   D is the total quantity of allowances issued European Union-wide relating to Year Y, as calculated in accordance with Article 9 of the Emissions Trading Directive.