83 Annual allocation adjustment

(1)

A person who has received a provisional allocation of New Zealand units for an eligible industrial activity in respect of a year must, subject to section 84, calculate the person’s annual allocation adjustment for the activity for the year by—

(a)

determining the person’s final allocation entitlement for the eligible industrial activity in respect of the year in accordance with the formula in subsection (2); and

(b)

then determining the annual allocation adjustment in accordance with the formula in subsection (3).

(2)

The formula for the calculation of a person’s final allocation entitlement is as follows:

FA = LA × ∑(PDCT × AB)

where—

FA

is the person’s final allocation entitlement for the eligible industrial activity for the year

LA

is the level of assistance for the activity for the year, being,—

(a)

for a moderately emissions-intensive eligible industrial activity,—

(i)

0.6 in 2010, 2011, and 2012; and

(ii)

in each year after 2012, the level of assistance from the previous year less 0.01 (the phase-out rate for a moderately emissions-intensive eligible industrial activity):

(b)

for a highly emissions-intensive eligible industrial activity,—

(i)

0.9 in 2010, 2011, and 2012; and

(ii)

in each year after 2012, the level of assistance from the previous year less 0.01 (the phase-out rate for a highly emissions-intensive eligible industrial activity)

is the symbol for summation (of each PDCT × AB calculation)

PDCT

is the amount of each prescribed product from the eligible industrial activity produced by the person in the year, as determined, if relevant, in accordance with regulations made under this Act

AB

is the prescribed allocative baseline for the applicable product that is required to be used by the eligible person by regulations made under this Act.

(3)

The formula for the calculation of a person’s annual allocation adjustment is as follows:

AA = PA – FA

where—

AA

is the person’s annual allocation adjustment of units for the eligible industrial activity for the year

PA

is the person’s provisional allocation for the eligible industrial activity notified by the EPA under section 86B

FA

is the person’s final allocation entitlement for the eligible industrial activity for the year calculated under subsection (2).

(4)

If the figure for AA calculated under the formula in subsection (3)—

(a)

is a negative number, then the person is entitled to be allocated the number of units in the annual allocation adjustment:

(b)

is a positive number, then the person is liable to repay the number of units in the annual allocation adjustment.

(5)

If an eligible person is entitled to be allocated the number of units in an annual allocation adjustment and the person—

(a)

makes an application for a provisional allocation for the same eligible industrial activity in the year following the year to which the annual allocation adjustment relates, then the person must record the adjustment in the person’s application for a provisional allocation for the following year:

(b)

does not make an application for a provisional allocation for the same eligible industrial activity in the year following the year to which the annual allocation adjustment relates, the person may make a separate application under section 86 for an allocation of the number of units in the annual allocation adjustment.

(6)

If an eligible person is liable to repay the number of units in an annual allocation adjustment and the person—

(a)

makes an application for a provisional allocation for the same eligible industrial activity in the year following the year to which the annual allocation adjustment relates, then—

(i)

the person must record the adjustment for the year in the person’s application for a provisional allocation for the following year; and

(ii)

subject to section 86B, the EPA must deduct the number of units in the adjustment from the provisional allocation for the following year, unless the number of units in the provisional allocation is less than the adjustment, in which case the person must, within 20 working days of being notified of the shortfall in the number of units by the EPA, repay the shortfall by transferring the relevant number of units to a Crown holding account designated by the EPA; or

(b)

does not make an application for a provisional allocation for the same eligible industrial activity in the year following the year to which the annual allocation adjustment relates, then the person must—

(i)

by 30 April in the year following the year to which the annual allocation adjustment relates, notify the EPA of the person’s annual allocation adjustment; and

(ii)

by 31 May in the year following the year to which the annual allocation adjustment relates, repay the number of units in the annual allocation adjustment by transferring the units to a Crown holding account designated by the EPA.

(7)

If a person is required to repay units under this section, then—

(a)

the units repaid must be of a type that may be transferred to a surrender account at the time the units are repaid; and

(b)

sections 134 and 135 apply, with any necessary modifications, as if—

(i)

the units the person is required to repay were units transferred to the person in error; and

(ii)

the requirement to repay the units arose under section 125.

Section 83: substituted, on 8 December 2009, by section 32 of the Climate Change Response (Moderated Emissions Trading) Amendment Act 2009 (2009 No 57).

Section 83(2) formula item LA paragraph (a)(ii): replaced, on 1 January 2013, by section 32(1) of the Climate Change Response (Emissions Trading and Other Matters) Amendment Act 2012 (2012 No 89).

Section 83(2) formula item LA paragraph (b)(ii): replaced, on 1 January 2013, by section 32(2) of the Climate Change Response (Emissions Trading and Other Matters) Amendment Act 2012 (2012 No 89).

Section 83(3) formula item PA: amended, on 5 December 2011, by section 19 of the Climate Change Response Amendment Act 2011 (2011 No 15).

Section 83(6)(a)(ii): amended, on 5 December 2011, by section 19 of the Climate Change Response Amendment Act 2011 (2011 No 15).

Section 83(6)(b)(i): amended, on 5 December 2011, by section 19 of the Climate Change Response Amendment Act 2011 (2011 No 15).

Section 83(6)(b)(ii): amended, on 5 December 2011, by section 19 of the Climate Change Response Amendment Act 2011 (2011 No 15).