Article 54 Cancellation of allowances and surplus surrendered allowances

(1)

The administrator must in respect of a participant cancel such quantity of allowances in the cancellation account which is equal to the participant’s CRC emissions for the relevant year of the phase—

(a)

except where sub-paragraph (b) or (c) applies, as stated in the annual report;

(b)

further to a determination under article 47(3); or

(c)

as provided under article 97(4)(a), 97(5), 100(2)(a), 100(3) or 101(2)(a).

(2)

Where a participant surrenders to the cancellation account more allowances (“surplus allowances”) than required under paragraph (1), the surplus allowances—

(a)

must remain in the cancellation account;

(b)

subject to article 52,—

(i)

are surrendered in respect of the subsequent year (“year 2”) in which the participant is required to comply with article 53; and

(ii)

must be cancelled before any other allowances which are surrendered.

(3)

Where the surplus allowances exceed the quantity required to be surrendered in year 2, subject to article 52, paragraph (2)(b) applies to the years after year 2 until no surplus allowances remain.