U.S. facilities required to report 2010 emissions

The U.S. Environmental Protection Agency ("EPA") will begin tracking greenhouse emissions in 2010. The data will help the government determine how best to reduce emissions and may inform the allocation of allowances under a cap-and-trade system. Canadian companies with U.S. operations should ensure that appropriate data gathering systems and procedures are in place before the new year.

The Final Mandatory Reporting of Greenhouse Gases Rule (the "Reporting Rule") requires facilities that emit more than 25,000 metric tonnes CO2 equivalent per year to report their emissions to the EPA. The 25,000 tonne threshold is expected to catch about 10,000-15,000 companies and about 85% of U.S. emissions.

The threshold falls in the lower middle of the range of reporting threshold proposed in other jurisdictions, for example:

• Alberta's reporting threshold is 100,000 tonnes under the Specified Gas reporting Standard;
• Canada announced in July that facilities emitting more than 50,000 tonnes will have to report their emissions for the 2009 calendar year by July 1, 2010;
• B.C. intends to announce reporting regulations this fall with a threshold of 20,000 tonnes for most facilities and 10,000 metric tonnes for aggregated upstream oil and gas operations; and
• The Western Climate Initiative announcede Final Essential Requirements for Mandatory Reporting with a reporting threshold of 10,000 tonnes.

The gases covered by the Reporting Rule are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), sulfur hexafluoride (SF6), and other fluorinated gases including nitrogen trifluoride (NF3) and hydrofluorinated ethers (HFE).

Subject to some exceptions, the EPA will require data at the facility level.

The Reporting Rule takes effect in the new year. Facilities will be required to file emissions data for the 2010 calendar year by March 31, 2011.

Details of the Reporting Rule, as well as a helpful Q&A, are available from the EPA.