These regulations are the Climate Change (Eligible Industrial Activities) Regulations 2010.

These regulations come into force on 8 July 2010.

In these regulations, unless the context otherwise requires,—

The transitional, savings, and related provisions set out in Schedule 1 have effect according to their terms.

The emissions intensity for each eligible industrial activity is set out in column A of Schedule 2.

The allocative baseline for each product of each eligible industrial activity is set out in column B of Schedule 2.

An eligible person who, in a year, carries out an eligible industrial activity must use 1 of the following methods for calculating the amount of each product produced by carrying out the activity during that year:

If both of the methods specified in subclause (1) are infeasible, then the eligible person must—

For any application for a provisional allocation or a final allocation entitlement in respect of the same year, an eligible person must use the same method to calculate the amount of product produced.

The allocation factor for electricity used to determine—

Subclause (2) prescribes modelling assumptions for the purpose of the market model that the Electricity Authority uses to determine the ETS impact on the price of electricity in a financial year under section 161FA(3) of the Act.

The modelling assumptions are that,—

Aluminium smelting is an eligible industrial activity.

The product produced by aluminium smelting that must be used as the basis of allocation is the total tonnes of primary aluminium (Al) as weighed after electrolysis but before casting, with a purity equal to or greater than 98%, and that is produced by carrying out the eligible industrial activity.

For the purposes of this regulation and Schedule 2, aluminium smelting means the physical and chemical transformation of alumina (aluminium oxide, Al₂O₃) into saleable aluminium metal, where the output of this activity is saleable aluminium metal.

Despite anything in these regulations, the allocative baselines for the product specified in subclause (2) that is produced by New Zealand Aluminium Smelters Limited (company number 156735) are as follows:

The production of burnt lime is an eligible industrial activity.

The product produced by the production of burnt lime that must be used as the basis of allocation is the total tonnes of burnt lime that is—

For the purposes of this regulation and Schedule 2, the production of burnt lime means the physical and chemical transformation through the calcining process of calcium and magnesium sources (eg, calcium carbonate (CaCO₃) and magnesium carbonate (MgCO₃)) into saleable burnt lime, where the output is burnt lime with a calcium oxide (CaO) or magnesium oxide (MgO) mass content equal to or greater than 60%.

The production of carbamide (urea) is an eligible industrial activity.

The products produced by the production of carbamide (urea) that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2,—

The production of cartonboard is an eligible industrial activity.

The products produced by the production of cartonboard that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2, production of cartonboard means the physical transformation of wood chips, sawdust, log billets, wood pulp, or recovered paper to produce rolls or sheets of cartonboard, where the output of this activity is saleable cartonboard that has a grammage range of 150 g/m² to 500 g/m², a moisture content in the range of 4% to 11% by weight, and is to be generally used as a cartonboard product (for example, kraft liner, multi-ply, and other paperboard).

The production of caustic soda is an eligible industrial activity.

The product produced by the production of caustic soda that must be used as the basis of allocation is the total tonnes of 100% equivalent dry-weight sodium hydroxide (NaOH, caustic soda) that is—

For the purposes of this regulation and Schedule 2, production of caustic soda means the production of chlorine gas and sodium hydroxide (caustic soda) solution by the chemical transformation of sodium chloride solution (NaCl(aq), brine) to chlorine (Cl₂(l,g)) and sodium hydroxide solution (NaOH(aq), caustic soda solution), where the sodium hydroxide (NaOH) production is 1:1.13 times the production of chlorine (Cl₂) by mass and the outputs include—

The chemical reaction involved in the chemical transformation specified in subclause (3) is—

The production of ethanol is an eligible industrial activity.

The product produced by the production of ethanol that must be used as the basis of allocation is the total kilolitres of 100% equivalent ethanol (C₂H₅OH) at 20°C, assuming a density of ethanol (C₂H₅OH) of 789.24 kg/m³ at 20°C, that is—

For the purposes of this regulation and Schedule 2, production of ethanol means the production of high-purity ethanol by the chemical transformation of fermentable sugars (for example, C₆H₁₂O₆ or C₅H₁₀O₅ or C₁₂H₂₂O₁₁ or C₁₈H₃₂O₁₆) to ethanol (C₂H₅OH) and the subsequent purification process, where the outputs include high-purity ethanol, which must have a concentration of ethanol (C₂H₅OH) equal to or greater than 95% with respect to volume.

The production of hydrogen peroxide is an eligible industrial activity.

The product produced by the production of hydrogen peroxide that must be used as the basis of allocation is the total tonnes of 100% equivalent hydrogen peroxide (H₂O₂) that is—

For the purposes of this regulation and Schedule 2, production of hydrogen peroxide means the chemical transformation of hydrogen (H) feedstocks and oxygen (O) feedstocks to produce a crude aqueous hydrogen peroxide solution, where the concentration of hydrogen peroxide (H₂O₂(aq)) is equal to or greater than 39% with respect to mass, and subsequent production of saleable aqueous hydrogen peroxide solutions, where the outputs include aqueous hydrogen peroxide solutions, which must have a concentration of hydrogen peroxide (H₂O₂(aq)) equal to or greater than 34% with respect to mass.

The production of market pulp is an eligible industrial activity.

The products produced by the production of market pulp that must be used as the basis of allocation are—

Any amount of the products described in subclause (2) that is to be used as the basis of allocation for the production of market pulp may not be used as the basis of allocation for any other eligible industrial activity.

For the purposes of this regulation and Schedule 2, production of market pulp means the physical transformation of wood chips, sawdust, wood pulp, or recovered paper to produce rolls or bales of market pulp, provided that the market pulp is dried to a moisture content of 4% to 20% by weight and is generally used in paper manufacturing, fibre cement products, or in the production of sanitary products, where the outputs include—

The production of methanol is an eligible industrial activity.

The product produced by the production of methanol that must be used as the basis of allocation is the total tonnes of 100% equivalent methanol (CH₃OH) that is—

For the purposes of this regulation and Schedule 2, production of methanol means the chemical transformation of 1 or more of hydrocarbons, hydrogen feedstocks, carbon feedstocks, and oxygen feedstocks to produce liquid methanol (CH₃OH), where the outputs include liquid methanol (CH₃OH), which must have a concentration equal to or greater than 98% with respect to mass.

The production of newsprint is an eligible industrial activity.

The products produced by the production of newsprint that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2, production of newsprint means the physical transformation of wood chips, sawdust, wood pulp or recovered paper to produce rolls of uncoated newsprint, where the output of this activity is uncoated newsprint that has a grammage range of 30 g/m² to 80 g/m², a moisture content in the range of 6% to 11% by weight, and is generally used as a newspaper product.

The production of packaging and industrial paper is an eligible industrial activity.

The products produced by the production of packaging and industrial paper that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2, production of packaging and industrial paper means the physical transformation of wood chips, sawdust, wood pulp, or recovered paper to produce rolls of uncoated packaging and industrial paper, where the output of this activity is uncoated packaging or industrial paper that has a grammage range of 30 g/m² to 500 g/m², a moisture content in the range of 4% to 12% by weight, and that is generally used as a packaging or industrial paper product (for example, kraft liner; recycled or multi-ply liner; medium, sack, and bag paper; wrapping paper; plasterboard liner; horticultural paper; or building paper; but excluding products produced by the production of cartonboard as specified in regulation 10).

The production of tissue paper is an eligible industrial activity.

The products produced by the production of tissue paper that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2, production of tissue paper means the physical transformation of wood chips, sawdust, or wood pulp to produce rolls of uncoated tissue paper, where the output of this activity is uncoated tissue paper that has a grammage range of 13 g/m² to 75 g/m², a moisture content in the range of 4% to 11% by weight, and is generally used as a tissue paper product (for example, facial tissue, paper towel, bathroom tissue, or napkins).

The manufacture of carbon steel from cold ferrous feed is an eligible industrial activity.

The products produced by the manufacture of carbon steel from cold ferrous feed that must be used as the basis of allocation are—

An eligible person who, in a year, produces the continuously cast products and ingots of carbon steel referred to in subclause (2)(a) must use the following methodology for calculating the total amount of product A and the total amount of product AA produced in the year:

Step 1: calculate total amount of products A and AA (T_{A & AA})

Step 2: calculate total amount of cold and molten ferrous feed used (T_{C & M})

Step 3: calculate total amount of each product

Long products of hot-rolled carbon steel and flat products of hot-rolled carbon steel may each be counted as a product only once in relation to the carrying on of the eligible industrial activity of manufacture of carbon steel from cold ferrous feed.

For the purposes of this regulation and Schedule 2,—

The production of cementitious products is an eligible industrial activity.

The products produced by the production of cementitious products that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2, production of cementitious products means the physical and chemical transformation of calcium carbonate compounds (CaCO₃, limestone) or other calcium carbonate (CaCO₃) feedstocks (component A) and clay or other silicon dioxide (SiO₂, silica), iron (Fe), aluminium oxide (Al2O₃, alumina), and other feedstocks (component B) into cementitious outputs—

The production of clay bricks and field tiles is an eligible industrial activity.

The products produced by the production of clay bricks and field tiles that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2, production of clay bricks and field tiles means the physical and chemical transformation of clays (including kaolinite and other clay minerals) by controlled mixing, forming, drying, and firing of the raw materials at a single location, where clay makes up at least 90% by weight of the raw materials (and additives to the clay do not exceed 10% by weight of the raw materials) and the clay composition includes alumina, silica, and varying degrees of metal oxides, where the outputs include—

The production of glass containers is an eligible industrial activity.

The product produced by the production of glass containers that must be used as the basis of allocation is the total tonnes of blown and pressed glass containers that is—

For the purposes of this regulation and Schedule 2, production of glass containers means the physical and chemical transformation of silica (silicon dioxide (SiO₂)) and other raw and recycled materials (for example, cullet) to produce blown or pressed glass containers by controlled melting and forming in a contiguous process, where the outputs include blown and pressed glass containers.

The manufacture of iron and steel from iron sand is an eligible industrial activity.

The products produced by the manufacture of iron and steel from iron sand that must be used as the basis of allocation are—

For the purposes of this regulation and Schedule 2,—

Despite anything in these regulations, the allocative baselines for Products A to E that are produced by New Zealand Steel Limited (company number 68953) are as follows:

The production of gelatine is an eligible industrial activity.

The product produced by the production of gelatine that must be used as the basis of allocation is the total tonnes, on a dry-weight basis, of gelatine that is—

For the purposes of this regulation and Schedule 2, production of gelatine means the physical and chemical transformation of collagen contained in animal material, including skins, bones, and connective tissues, where the output of the activity is gelatine with at least 97% protein content on a dry-weight basis.

The production of protein meal is an eligible industrial activity.

The product produced by the production of protein meal that must be used as the basis of allocation is the total tonnes of protein meal that is—

For the purposes of this regulation and Schedule 2, production of protein meal means the physical and chemical transformation of raw livestock-derived animal material into—

The production of fresh capsicums is an eligible industrial activity.

The product produced by the production of fresh capsicums that must be used as the basis of allocation is the total tonnes of fresh capsicums that are—

For the purposes of this regulation and Schedule 2, production of fresh capsicums means the biological transformation of capsicum seedlings in their final growing position to produce capsicums, where the output of the activity is fresh capsicums.

The production of fresh cucumbers is an eligible industrial activity.

The product produced by the production of fresh cucumbers that must be used as the basis of allocation is the total tonnes of fresh cucumbers that are—

For the purposes of this regulation and Schedule 2, production of fresh cucumbers means the biological transformation of cucumber seedlings in their final growing position to produce cucumbers, where the output of the activity is fresh cucumbers.

The production of cut roses is an eligible industrial activity.

The product produced by the production of cut roses that must be used as the basis of allocation is the number of cut flowering rose stems that are—

For the purposes of this regulation and Schedule 2, production of cut roses means the biological transformation of rose plants in their final growing position to produce flowering rose stems grown for commercial purposes, where the output of the activity is cut flowering rose stems.

The production of fresh tomatoes is an eligible industrial activity.

The product produced by the production of fresh tomatoes that must be used as the basis of allocation is the total tonnes of fresh tomatoes that are—

For the purposes of this regulation and Schedule 2, production of fresh tomatoes means the biological transformation of tomato seedlings in their final growing position to produce tomatoes, where the output of the activity is fresh tomatoes.

The production of reconstituted wood panels is an eligible industrial activity.

The product produced by the production of reconstituted wood panels that must be used as the basis of allocation is the total tonnes of reconstituted wood panels that are—

For the purposes of this regulation and Schedule 2, production of reconstituted wood panels means the physical and chemical transformation of wood particles (for example, wood flakes, chips, shavings, sawdust, and strands) and adhesives (for example, resins), where—

The production of lactose is an eligible industrial activity.

The product produced by the production of lactose that must be used as the basis of allocation is the total tonnes of dry-weight lactose that is—

For the purposes of this regulation and Schedule 2, production of lactose means the separation and drying of lactose from permeate, where—

The production of whey powder is an eligible industrial activity.

The product produced by the production of whey powder that must be used as the basis of allocation is the total tonnes of dry-weight whey powder that is—

For the purposes of this regulation and Schedule 2, production of whey powder means the physical and chemical transformation of whey, which consists of residual water and milk solids following the separation of curd from a milk-based coagulation process (for example, cheese or casein curd manufacture), into whey powder, where the output is whey powder that meets the compositional standards in the Codex Standard 289-1995 for whey powders and has a milk-derived protein content that does not exceed 33% weight by weight on an as-is basis.