The Carbon Market

Types of Participants in the GHG Emission Allowance
Cap-and-Trade System

Cap-and-trade system procedures and activities encompass three types of participants (referred to as “entities” in the CITSS system):

1. Emitter

In Québec, an emitter is any individual or municipality that operates a business:

• in an activity sector listed in Appendix A of the Regulation respecting a cap-and-trade system for greenhouse gas emission allowances that declares, for its business or an establishment of the same, in accordance with the Regulation respecting mandatory reporting of certain emissions of contaminants into the atmosphere (chapter Q-2, r. 15) (Mandatory Reporting Regulation), annual GHG emissions in an amount equal to or greater than 25,000 metric tons of CO₂ equivalent, excluding emissions referred to in the second paragraph of Section 6.6 of the Mandatory Reporting Regulation;
• in a sector of activity listed in Appendix A of the Regulation respecting a cap-and-trade system for greenhouse gas emission allowances, that is not an emitter within the meaning of the above paragraph, that reports for its establishment, in accordance with paragraph 1 of section 6.1 of the Mandatory Reporting Regulation, annual greenhouse gas emissions equal to or greater than 10,000 metric tons of CO₂ equivalent, and that registers in the system for the establishment concerned by that report without being bound to do so (Opt-in);
• that acquires electricity generated outside Québec, except electricity produced in the territory of a partner entity, for its own consumption or for sale in Québec, if the greenhouse gas emissions attributable to the generation of the quantity of electricity acquired, calculated in accordance with the Mandatory Reporting Regulation, are equal to or exceed 25,000 metric tons of CO₂ equivalent
• that distributes 200 liters or more of fuel within the meaning of protocol QC.30 of Schedule A.2 of the Mandatory Reporting Regulation.

All emitters subject to the system must open accounts in the CITSS system in order to fulfill their mandatory compliance under the Regulation.

2. Participant – Legal entity (voluntary)

A participating legal entity is an organization (a corporation or municipality) that wishes to voluntarily purchase, hold, sell, transfer, or withdraw emission allowances, but which is not obliged to do so under the Regulation. In other words, the participating legal entity is not an emitter to which the Regulation applies.

Legal entities wishing to participate in the aforementioned activities must also open an account in the CITSS system.

3. Participant – Natural person (voluntary)

A participating natural person is an individual (natural person) who wishes to voluntarily purchase, hold, sell, transfer, or withdraw emission allowances, but is not obliged to do so under the regulation. In other words, the participating natural person is not an emitter to which the Regulation applies.

Individuals wishing to participate in the aforementioned activities must also open an account in the CITSS system.