1. A. The Department shall administer the Long Term Contract Set-aside Account in accordance with the procedures of this regulation.

2. B. A long term contract applicant may purchase allowances from the Long Term Contract Set-aside Account through direct sale from the Department at the long term contract price if:

   1. (1) A long term contract with the applicant for the electrical output of its budget units has been in existence since January 1, 2001; and
   2. (2) The applicant is unable to recover the cost of purchasing allowances through electricity pricing or other mechanism.
3. C. The number of allowances purchased from the Long Term Contract Set-aside Account by an applicant may not exceed the equivalent tons of CO₂ that the applicant emits in the prior calendar year.
4. D. To remain eligible to purchase allowances from the Long Term Contract Set-aside Account through direct sale from the Department, the applicant shall renegotiate the long term contract to include the cost of purchasing CO₂ allowances when the first opportunity to exercise any option in the existing contract occurs.
5. E. Each calendar year, the CO₂ authorized account representative for the compliance account, referred to in this subtitle as the LTC applicant, shall make all requests for purchase of allowances from the Long Term Contract Set-aside Account to the Department in writing by November 15 of each year.
6. F. If all the allowances are not sold from the Long Term Contract Set-aside Account by the end of the calendar year, the undistributed allowances shall remain in the account. On or before January 31 of the following year, the Department shall transfer from the Consumer Energy Efficiency Account the number of allowances needed to restore the balance of the Long Term Contract Set-aside Account to 1,600,000.

7. G. Allowances Available for Purchase by LTC Applicants.

   1. (1) All allowances purchased by LTC applicants in accordance with §D of this regulation shall be maintained in the CO₂ budget source's compliance account and only used to demonstrate compliance for a control period.
   2. (2) Allowances purchased by LTC applicants in accordance with §D of this regulation may not be resold.

8. H. The request shall include the following:

   1. (1) A copy of the long term contract if it has not been provided to the Department previously, or if it has, a letter certifying that the contract has not changed; and
   2. (2) A letter certifying that the LTC applicant is unable to recover the cost of allowances through electricity pricing or other mechanism.

9. I. Calculation of Long Term Contract Price.

   1. (1) The Long Term Contract Price (LTCP) in calendar year 2013 shall be $1.98.
   2. (2) The LTCP in calendar year 2014 shall be $2.00.
   3. (3) For years subsequent to calendar year 2014, the LTCP shall be established as of the first day of each calendar year, and each calendar year thereafter, the LTCP shall be the LTCP from the previous calendar year multiplied by 1.025, rounded to the nearest whole cent.
10. J. The Long Term Contract Set-aside Account shall expire on January 1, 2027.

Authority: Environment Article, §§1-101, 1-404, 2-103, and 2-1002(g), Annotated Code of Maryland

Effective date: July 17, 2008 (35:14 Md. R. 1247)

Chapter revised effective May 18, 2009 (36:10 Md. R. 717)

Regulation .02 amended effective January 6, 2014 (40:26 Md. R. 2165)

Regulation .03 amended effective January 21, 2013 (40:1 Md. R. 22); January 6, 2014 (40:26 Md. R. 2165); December 31, 2018 (45:26 Md. R. 1249); March 30, 2026 (53:6 Md. R. 292)

Regulation .04A amended effective December 31, 2018 (45:26 Md. R. 1249)

Regulation .05A amended as an emergency provision effective December 28, 2009 (37:4 Md. R. 336); amended permanently effective May 3, 2010 (37:9 Md. R. 674); August 6, 2012 (39:15 Md. R. 964)

Regulation .05A amended effective January 6, 2014 (40:26 Md. R. 2165)

Regulation .05C repealed effective January 6, 2014 (40:26 Md. R. 2165)

Regulation .06 amended effective March 30, 2026 (53:6 Md. R. 292)

Regulation .06B amended effective January 21, 2013 (40:1 Md. R. 22); December 31, 2018 (45:26 Md. R. 1249)

Regulation .06D amended effective December 31, 2018 (45:26 Md. R. 1249)

Regulation .06G amended effective August 6, 2012 (39:15 Md. R. 964); January 21, 2013 (40:1 Md. R. 22); December 31, 2018 (45:26 Md. R. 1249)

Regulation .07 amended effective January 21, 2013 (40:1 Md. R. 22); December 31, 2018 (45:26 Md. R. 1249)

Regulation .07H amended effective January 6, 2014 (40:26 Md. R. 2165)

Regulation .07J adopted effective March 30, 2026 (53:6 Md. R. 292

Regulation .07N amended effective August 6, 2012 (39:15 Md. R. 964)

Regulation .08 amended as an emergency provision effective February 1, 2011 (38:4 Md. R. 263); amended permanently effective May 16, 2011 (38:10 Md. R. 617)

Regulation .08A amended effective January 21, 2013 (40:1 Md. R. 22)

Regulation .08C amended effective August 6, 2012 (39:15 Md. R. 964); January 21, 2013 (40:1 Md. R. 22)

Regulation .08D adopted effective February 12, 2018 (45:3 Md. R. 157)

Regulation .09 amended effective February 12, 2018 (45:3 Md. R. 157)

Regulation .09B amended effective January 21, 2013 (40:1 Md. R. 22)

Regulation .09H amended effective August 6, 2012 (39:15 Md. R. 964); January 21, 2013 (40:1 Md. R. 22)

Regulation .10 amended effective March 30, 2026 (53:6 Md. R. 292)

Regulation .11 D, E amended effective March 30, 2026 (53:6 Md. R. 292)

Regulation .11H amended effective December 31, 2018 (45:26 Md. R. 1249)