The Maryland CO2 Budget Trading Program consists of allowances to cover CO2 emissions for the following: 12,663,369 tons for 2027; 11,080,448 tons for 2028; 9,497,526 tons for 2029; 7,914,605 tons for 2030; 6,331,684 tons for 2031; 4,748,763 tons for 2032; 3,165,842 tons for 2033; 2,713,579 tons for 2034; 2,261,316 tons for 2035; 1,809,053 tons for 2036; and 1,356,790 tons for 2037 and each succeeding calendar year. CO2 Allowances Available for Allocation. For the allocation year 2027 and each succeeding calendar year, the Maryland CO2 Budget Trading Program base budget shall be the maximum number of allowances available for allocation in a given allocation year, except for CO2 CCR tier 1 and CO2 CCR tier 2 allowances. Cost Containment Reserve Allocation. The Department shall allocate CO2 CCR tier 1 and CO2 CCR tier 2 allowances, separate from and in addition to the Maryland CO2 Budget Trading Program base budget set forth in §A of this regulation, to the Consumer Energy Efficiency Account. The CCR allocation is for the purpose of containing the cost of CO2 allowances.. On or before January 1, 2027, and each calendar year thereafter, the Department shall allocate 2,130,856 current vintage year CO2 CCR tier 1 and 2,130,856 CO2 CCR tier 2 allowances, and withdraw the number of CO2 CCR tier 1 and CO2 CCR tier 2 allowances that remain in the Maryland CO2 Budget Trading Program at the end of the prior calendar year. The Department shall withdraw the number of CO2 allowances that remain in the Consumer Energy Efficiency Account at the end of the prior calendar year. Repealed. Serial Numbers for CO2 Allowances. Before allowances are made available for allocation, the Department shall assign a unique serial number to each allowance including digits that will identify the year the allowances are made available. Repealed. Repealed. Repealed. Repealed. General Distribution of CO2 Allowances. The Department shall open and manage a general account for the following: The Long Term Contract Set-aside Account; The Clean Generation Set-aside Account; and The Consumer Energy Efficiency Account. On or before January 31 of each calendar year, the Department shall allocate all CO2 allowances from the CO2 Budget Trading Program to the Consumer Energy Efficiency Account, except as directed in §J(3) and (4) of this regulation. The Department shall allocate CO2 allowances from the Consumer Energy Efficiency Account to each of the following accounts, except as directed in Regulation .09 of this chapter, so that the total number of allowances in each account is: 1,600,000 in the Long Term Contract (LTC) Set-aside Account; and The following number of allowances in the Clean Generation Set-aside Account: 1,687,679 for 2018; 1,500,159 for 2019; 1,312,639 for 2020; 1,125,119 for 2021; and 937,599 for 2022. If, on December 31 of each year, allowances have been sold or awarded from a set-aside account such that the number of allowances in the set-aside account falls below the required allocation in §J(3)(a)—(c) of this regulation, as applicable, that account shall be replenished from the Consumer Energy Efficiency Account in the following calendar year using allowances from that calendar year. Demonstrating Compliance. Unless otherwise specified in this chapter, a CO2 budget source shall demonstrate compliance with its CO2 budget emissions limitation by holding one CO2 allowance in its compliance account for every ton of CO2 that it emits in a control period, by the allowance transfer deadline for that control period. As of the CO2 allowance transfer deadline for an interim control period, the owners and operators of each CO2 budget source and each CO2 budget unit at the source shall hold, in the source’s compliance account for deduction under §K of this regulation, CO2 allowances for no less than 50 percent of the total number of tons of CO2 emissions for the interim control period from all CO2 budget units at the source. Allowances Available for Compliance Deduction. The following CO2 allowances may be deducted from a compliance account for purposes of complying with a budget source's CO2 budget emissions limitation for a control period or an interim control period: CO2 allowances that are not CO2 offset allowances and are identified as allowances falling within a prior control period, the same control period, or the same interim control period for which the allowances are deducted; CO2 allowances that are held or transferred into the CO2 budget source's compliance account as of the CO2 allowance transfer deadline for that control period or for the interim control period contained within that control period; CO2 offset allowances that are available to be deducted for compliance during a control period or an interim control period where the quantity of allowances is limited to: 3.3 percent of the CO2 budget source’s CO2 emissions for that control period; or 3.3 percent of the CO2 budget source’s CO2 emissions for an interim control period multiplied by 0.50. Deduction of CO2 allowances: The Department shall deduct allowances from the CO2 budget source's compliance account until: The number of CO2 allowances deducted equals 50 percent of the total CO2 emissions for an interim control period; or The number of CO2 allowances deducted equals the total CO2 emissions for the control period. No deduction shall be made for CO2 emissions attributable to the burning of eligible biomass. The identification of available CO2 allowances for compliance deduction by serial number or by default is as follows: The CO2 authorized account representative for a source's compliance account may request that specific CO2 allowances, identified by serial number for a control period or interim control period, be deducted; and In the absence of an identification or in the case of a partial identification of available CO2 allowances by serial number, the Department shall deduct CO2 allowances for a control period or interim control period in the following descending order: For the first control period, all CO2 allowances purchased by direct sale from the Department during years 2009, 2010, and 2011 resulting from the occurrence of the $7 auction clearing price; All CO2 allowances for a control period allocated to a CO2 budget unit from the Long Term Contract Set-aside Account or the Clean Generation Set-aside Account; Subject to the relevant compliance deduction limitations identified in §K(3)(c) of this regulation, any CO2 offset allowances transferred and recorded in the compliance account, in chronological order, or, in the event that some, but not all, CO2 offset allowances from a particular allocation year are to be deduced, CO2 offset allowances shall be deducted by serial number, with lower serial number CO2 offset allowances deducted before higher serial number allowances; and Any CO2 allowances, other than those identified in §K(5)(b)(i)—(iii) of this regulation, that are available for deduction in the order they were recorded. Deductions for Excess Emissions. If a CO2 budget source has excess emissions, the Department shall deduct CO2 allowances from the CO2 budget source's compliance account equal to three times the excess emissions. If a source’s compliance account holds insufficient CO2 allowances to cover the excess emissions, the source shall immediately transfer sufficient allowances into its compliance account. CO2 offset allowances may not be deducted to account for the source's excess emissions. No CO2 allowance deduction shall relieve the owners or operators of the CO2 budget units at the source of liability for any fine, penalty, assessment or obligation to comply with any other remedy, for the same violation, as ordered under applicable State law. Guidelines. The following guidelines apply in assessing fines, penalties, or other obligations: For purposes of determining the number of days of violation, if a CO2 budget unit has excess emissions for a control period or interim control period, each day in the control period or interim control period, as applicable, constitutes a separate day of violation unless the owners or operators of the unit can demonstrate to the satisfaction of the Department that a lesser number of days should be considered; and The Department shall consider the amount of excess emissions in determining the severity of the violation. Each ton of excess interim emissions is a separate violation. If the CO2 budget source's compliance account no longer exists, the CO2 allowances shall be deposited in a general account selected by the owner or operator of the CO2 budget source. Adjustments and Errors. The Department may review and conduct independent audits concerning any submission under this subtitle and make appropriate adjustments to the information, if necessary. The Department may correct any error in any account and, within 10 business days of making any correction, notify the CO2 authorized account representative for the account.