(a) You may average, bank, and trade (ABT) emission credits for purposes of certification as described in this subpart and in subpart B of this part to show compliance with the standards of Sec. 1036.108. Participation in this program is voluntary. (Note: As described in subpart B of this part, you must assign an FCL to all engine families, whether or not they participate in the ABT provisions of this subpart.)
(b) [Reserved]
(c) The definitions of subpart I of this part apply to this subpart. The following definitions also apply:
(1) Actual emission credits means emission credits you have generated that we have verified by reviewing your final report.
(2) Averaging set means a set of engines in which emission credits may be exchanged. Credits generated by one engine may only be used by other engines in the same averaging set. See Sec. 1036.740.
(3) Broker means any entity that facilitates a trade of emission credits between a buyer and seller.
(4) Buyer means the entity that receives emission credits as a result of a trade.
(5) Reserved emission credits means emission credits you have generated that we have not yet verified by reviewing your final report.
(6) Seller means the entity that provides emission credits during a trade.
(7) Standard means the emission standard that applies under subpart B of this part for engines not participating in the ABT program of this subpart.
(8) Trade means to exchange emission credits, either as a buyer or seller.
(d) Emission credits may be exchanged only within an averaging set as specified in Sec. 1036.740.
(e) You may not use emission credits generated under this subpart to offset any emissions that exceed an FCL or standard. This applies for all testing, including certification testing, in-use testing, selective enforcement audits, and other production-line testing. However, if emissions from an engine exceed an FCL or standard (for example, during a selective enforcement audit), you may use emission credits to recertify the engine family with a higher FCL that applies only to future production.
(f) Emission credits may be used in the model year they are generated. Surplus emission credits may be banked for future model years. Surplus emission credits may sometimes be used for past model years, as described in Sec. 1036.745.
(g) You may increase or decrease an FCL during the model year by amending your application for certification under Sec. 1036.225. The new FCL may apply only to engines you have not already introduced into commerce.
(h) You may trade emission credits generated from any number of your engines to the engine purchasers or other parties to retire the credits. Identify any such credits in the reports described in Sec. 1036.730. Engines must comply with the applicable FELs even if you donate or sell the corresponding emission credits under this paragraph (h). Those credits may no longer be used by anyone to demonstrate compliance with any EPA emission standards.
(i) See Sec. 1036.740 for special credit provisions that apply for credits generated under Sec. 1036.615 or 40 CFR 1037.104(d)(7) or 1037.615.
(j) Unless the regulations explicitly allow it, you may not calculate credits more than once for any emission reduction. For example, if you generate CO2 emission credits for a hybrid engine under this part for a given vehicle, no one may generate CO2 emission credits for that same hybrid engine and vehicle under 40 CFR part 1037. However, credits could be generated for identical vehicles using engines that did not generate credits under this part.