Article 14 Article 4 amended (application for free allocation in 2027-2030 allocation period by operators of incumbent installations)

Article 4 is amended as follows.

For paragraph 1a(b) substitute—

“(b)

the second stage is that in the period beginning with 1 April 2026 and ending with 30 June 2026, the operator must:

(i)

notify the regulator in writing that the operator wishes the application to proceed;

(ii)

notify the regulator in writing which of their sub-installations are UK CBAM sub-installations and which of their sub-installations are not UK CBAM sub-installations; and

(iii)

where requested by the regulator, resubmit the documents referred to in paragraph 2.”.

After paragraph 1b insert—

“1c.

As part of the second stage under paragraph 1a(b), where the operator has any relevant product benchmark sub-installation, any relevant heat benchmark sub-installation, any relevant fuel benchmark sub-installation or any relevant process emissions sub-installation, the operator must during the second stage resubmit the documents referred to in paragraph 2(a) and 2(c) reflecting the division required by Article 10(4a). Submission of these documents satisfies the requirement in paragraph 1a(b)(ii).

1d.

As part of the second stage under paragraph 1a(b), the operator may notify the regulator that the data submitted in their baseline data report for a sub-installation or installation covering the 2020 scheme year, or both the 2020 and 2021 scheme years, is to be excluded from the calculation under Article 15 of historical activity levels for that sub-installation or installation.

1e.

The regulator must request corrections by the operator of any non-conformities or any errors made by the operator during the second stage under paragraph 1a(b) which impact on the determination of the historical activity levels or the calculation of free allocation.”.

In paragraph 7 for “paragraph 1a(b)(ii)” substitute “paragraph 1a(b)(iii) or 1c”.

After paragraph 7 insert—

“7a.

Where, as part of the second stage under paragraph 1a(b), the operator makes a notification under paragraph 1d:

(a)

Article 15 applies again in relation to the application, but any reference to baseline period must be read as excluding the 2020 scheme year or the 2020 and 2021 scheme years;

(b)

Article 15a(2) and (3) apply again in relation to the application, with the following modifications:

(i)

any reference to historical activity levels must be read as a reference to any historical activity levels redetermined under Article 15 as so applied;

(ii)

Article 15a(2)(b) applies as if for “30 September 2025” there were substituted “30 September 2026”;

(c)

for the purpose of paragraph 6(b), Article 15a(4) and (5) apply in relation to the application taking account of the historical activity levels redetermined under Article 15 as so applied.”.

After paragraph 8 insert—

“9.

In this Article:

(a)

an operator has a “relevant product benchmark sub-installation” where:

(i)

the operator’s stage one baseline data report included a product benchmark sub-installation; and

(ii)

as a result of the requirement in Article 10(4a), the inputs, outputs and emissions that were assigned to that product benchmark sub-installation at stage one have subsequently been assigned to two or more product benchmark sub-installations;

(b)

an operator has a “relevant heat benchmark sub-installation” where:

(i)

the operator’s stage one baseline data report included a heat benchmark sub-installation; and

(ii)

as a result of the requirement in Article 10(4a), the inputs, outputs and emissions that were assigned to that heat benchmark sub-installation at stage one have subsequently been assigned to two or more heat benchmark sub-installations;

(c)

an operator has a “relevant fuel benchmark sub-installation” where:

(i)

the operator’s stage one baseline data report included a fuel benchmark sub-installation; and

(ii)

as a result of the requirement in Article 10(4a), the inputs, outputs and emissions that were assigned to that fuel benchmark sub-installation at stage one have subsequently been assigned to two or more fuel benchmark sub-installations;

(d)

an operator has a “relevant process emissions sub-installation” where:

(i)

the operator’s stage one baseline data report included a process emissions sub-installation; and

(ii)

as a result of the requirement in Article 10(4a), the inputs, outputs and emissions that were assigned to that process emissions sub-installation at stage one have subsequently been assigned to two or more process emissions sub-installations.”.