2005 California Health and Safety Code Sections 42840-42843 Verifying Emissions

42840.  (a) Participants shall utilize the following reporting
procedures to establish a greenhouse gas emissions baseline,
participants shall report their certified emissions for the most
recent year for which they have complete energy use and fuel
consumption data as specified in this chapter.  Participants that
have complete energy use or fuel consumption data for earlier years
that can be certified may establish their baseline as any year
beginning on or after January 1, 1990.  After establishing baseline
emissions, participants shall report their certified emissions
results in each subsequent year in order to show changes in emissions
levels with respect to their baseline year.  Participants may report
annual emission results without establishing an emissions baseline.
Participants shall also report using industry-specific metrics once
the registry adopts an industry-specific metric for the industry in
question.
   (b) (1) Participants shall report direct emissions and indirect
emissions separately.  Direct emissions are those emissions from
applicable sources that are under management control of a
participating entity, including onsite combustion, fugitive
noncombustion emissions, and vehicles owned and operated by the
participant.  Indirect emissions that are required to be reported by
participants are those emissions embodied in  net electricity and
steam imports, including offsite steam generation and district
heating and cooling.  Participants are encouraged, but are not
required, to report other indirect emissions based on guidance that
is adopted by the registry.
   (2) On or after January 1, 2004, the registry board, in
coordination with the State Energy Resources Conservation and
Development Commission, may revise the scope of indirect emission
source types that are required to be reported by participants
specified in paragraph (1) after a public workshop and review process
conducted by the registry if all of the following requirements have
been met.
   (A) The State Energy Resources Conservation and Development
Commission has approved that revision at a public hearing following a
public workshop.
   (B) Prior to approving that proposed revision, the commission
determines all of the following:
   (i) A reasonable and generally-accepted methodology exists that
will enable participants to accurately estimate and report the
emissions for the indirect source type in question.
   (ii) The proposed revision will not create an unreasonable
reporting burden on the participants.
   (iii) The proposed revision is necessary to achieve the purposes
listed in Section 42810.
   (C) The registry, at any time it acts to revise the scope of
indirect emission source types that are required to be reported by
participants, establishes a timeframe for the phasein of the revised
scope so that participants shall have at least four months before the
start of the next annual reporting cycle that incorporates the
revised scope.
   (3) In cases of joint ownership, emissions are reported by the
managing entity, unless the owners decide to report emissions on a
pro rata basis.
   (4) Participants shall not be required to report emissions of any
greenhouse gas that is de minimis in quantity, when summed up across
all applicable sources of the participating entity.  The State Energy
Resources Conservation and Development Commission shall recommend to
the registry a definition of de minimis emissions that reasonably
accounts for differences in the size, activities, and sources of
direct and indirect baseline emissions of participants, and is
consistent with the goals and intent of subdivision (f) of Section
42801.
   (c) (1) All participants shall report direct and indirect carbon
dioxide (CO2) emissions that are material to their operations.
   (2) The registry shall also encourage participants to monitor and
report emissions of the following gases:
   (A) Hydrofluorocarbons (HFCs).
   (B) Methane (CH4).
   (C) Nitrous Oxide (N2O).
   (D) Perfluorocarbons (PFCs).
   (E) Sulfur hexafluoride (SF6).
   (3) The report of information specified in paragraph (2) is
optional for three years after a participant joins the registry.
After participating in the registry for a total of three years,
participants shall report emissions required by both paragraphs (1)
and (2).
   (4) Emissions of all gases under this subdivision shall be
reported in mass units.
   (d) The basic unit of participation in the registry shall be an
entity in its entirety such as a corporation or other legally
constituted body, any city or county, and each state government
agency.  The registry shall not record emissions baselines and
reductions for individual facilities or projects, except to the
extent they are included in an entity's emissions reporting.
   (1) Corporations may report emissions baselines and annual
emissions results from subsidiaries if the parent corporation is
clearly defined.
   (2) Participants shall report emissions results from all of their
applicable sources in the state when they initially register.
   (3) Participants may, and are encouraged to, at any time, register
emissions from all applicable sources based in the United States, so
long as this reporting meets all the other requirements established
by this chapter.  Those participants with emissions in other states
that report California emissions only may not be able to receive
equal consideration for their emissions records in future national or
international regulatory regimes relating to greenhouse gas
emissions.  In addition, participants with operations outside of the
United States are encouraged to register their total worldwide
emissions baselines and annual emissions results.  Within three
years, the registry shall review and report to the Legislature with a
recommendation on whether the registry should require, rather than
encourage, participants to report all of their greenhouse gas
emissions in the United States, not just California emissions.
   (4) To ensure that reported emissions reflect actual emissions,
participants that outsource production or services shall report
emissions associated with the outsourced activity, and remove these
emissions from their emissions baseline.  The subcontracted entity,
if it voluntarily chooses to participate in the registry shall report
emissions associated with the outsourced activities it has taken
over.  Participants shall attest at least once each year that the
entity has not outsourced any emissions, or that if it has, that all
emissions associated with the outsourced activity have been reported
and subtracted from the entity's baseline emissions.
   (5) To prevent changes in vertical integration within corporations
from leading to apparent emissions reductions when in fact no
reductions have occurred, the registry shall treat mergers,
acquisitions, and divestitures as follows:
   (A) The emissions baselines of any merged or acquired entity shall
be added together, and the registry shall treat the resulting entity
as if it had been one corporation from the beginning.
   (B) In divestitures, the emissions baselines of the affected
corporations shall be split, with the effect that the registry shall
treat them as if they had been separate corporations from the
beginning.  If the divested corporation is purchased by another firm,
the registry shall treat that purchase as a merger with the
purchasing corporation.  If the divested corporation remains a
separate entity after the divestiture, its registry baseline shall
reflect the emissions associated with the entity's operations before
the divestiture.  Corporations that divest operations may allocate
certified emissions results achieved prior to the divestiture among
the divesting and the divested entities, and the registry shall
adjust their baselines accordingly.
   (C) Any adjustments for changes in vertical integration shall be
verified in the annual emissions certifications required for
recordation of emissions results.
   (6) If a participant changes from statewide to national reporting
under this program, changes to its baseline will be treated in a
similar manner as changes in vertical integration as described in
paragraph (5).
   (7) To ensure that reported emissions accurately reflect shifts in
operations to or from other states, the registry shall adopt, in
consultation with the State Energy Resources Conservation and
Development Commission, at a public meeting and following at least
one public workshop, reporting procedures for participants that
choose to report greenhouse emissions on a statewide basis that
require participants to show both of the following:
   (A) Changes in a participant's operations, such as a facility
startup or shutdown, that result in a significant and long-term shift
of greenhouse gas emissions from California to other states or from
other states to California.
   (B) The corresponding change in the participant's baseline.
42841.  (a) To support the estimation, calculation, reporting, and
certification of emissions results in a consistent format, the
registry shall adopt standardized forms that all participants shall
use to calculate, report, and certify emissions results, unless an
alternative format is (1) reviewed and recommended by the State
Energy Resources Conservation and Development Commission and the
State Air Resources Board, and (2) adopted by the registry, and
deemed to be consistent with the goals and intent of this chapter.
In cooperation with the State Energy Resources Conservation and
Development Commission, the registry shall review commonly available
emissions tracking software to determine whether existing software
packages are able to generate reports for the registry.
   (b) The procedures established for all of the following shall
conform to the requirements of Article 6 (commencing with Section
42870):
   (1) Establishing electricity and fuel usage and for calculating
associated emissions.
   (2) Mass-balance calculations, stack testing, or continuous
emissions monitoring of greenhouse gases from onsite fuel combustion
are all acceptable ways of reporting greenhouse gases from onsite
fuel combustion.
   (3) Estimating, calculating, reporting, and certifying
noncombustion emissions of the gases listed in paragraphs (1) and (2)
of subdivision (c) of Section 42840.
   (4) Collecting and maintaining data and records of energy, fuel,
and chemical consumption sufficient to allow contemporaneous and ex
post certification of direct and indirect emissions.
42842.  (a) Participants registering baseline emissions and
emissions results in the registry shall provide certification of
their methodologies and results.  The registry board may, upon
recommendation of the State Energy Resources Conservation and
Development Commission and the state board, following a public
process, adopt simplified procedures to certify emissions results as
appropriate.  Participants shall follow registry-approved procedures
and protocols in determining emissions, and supply the quantity and
quality of information necessary to allow an independent ex post
certification of the emissions baseline and emissions results
reported under this program.
   (b) The registry shall adopt a list of approved third-party
organizations recognized as competent to certify emissions results as
provided in this chapter.  The process for evaluating and approving
these organizations shall be developed in coordination with the State
Energy Resources Conservation and Development Commission.  The
registry may reopen the qualification process periodically in order
for new organizations to be added to the approved list.
   (c) As appropriate, the registry shall refer participants to the
organization on the approved list described in subdivision (b).
   (d) Where required by the registry for certification,
organizations approved pursuant to subdivision (b) shall do all of
the following:
   (1) Evaluate whether the participant has a program, consistent
with registry-approved procedures and protocols, in place for
preparation and submittal of the information reported under this
chapter.
   (2) Check, during certification, the reasonableness of the
emissions information being reported for a random sample of estimates
or calculations.
   (3) Summarize its review in a report to the board of directors, or
equivalent governing body, of the participating entity, attesting to
the existence of a program that is consistent with registry-approved
procedures and protocols and the reasonableness of the reported
emissions results and noting any exceptions, omissions, limitations,
or other qualifications to their representations.
   (e) In conducting certification for a participant under this
program, the approved organization shall schedule any meeting or
meetings with the participant in advance at one or more
representative locations and allow the participant to control
property access.  The meetings shall be conducted in accordance with
a protocol that is agreed upon in advance by the participant and the
approved organization.  The approved organization shall not perform
facility inspection, direct measurement, monitoring, or testing
unless authorized by the participant.
   (f) To ensure the integrity and constant improvement of the
registry program, the State Energy Resources Conservation and
Development Commission shall perform on a random basis an occasional
review and evaluation of participants' emissions  reporting,
certifications, and the reasonableness of the emissions information
being reported for analysis of estimates or calculations.  The
commission shall report any findings in writing to the registry.  The
registry shall include a summary of these findings in the biennial
report to the Governor and the Legislature required by Article 5
(commencing with Section 42860).
42843.  Not later than July 1, 2003, and periodically thereafter,
the registry shall evaluate and review the approaches to emissions
reporting described in subdivision (b) of Section 42840, in light of
knowledge gained from the actual practices of estimating,
calculating, reporting, and certifying emissions, and, upon
recommendation of the State Energy Resources Conservation and
Development Commission following a public process, may modify or
revise reporting requirements as appropriate to further the purposes
of this chapter.