- Deficit generators pay 95% of the program cost.
- Credit generators pay 5% of the program cost.
2023 final fee, based on 130 registered participants on March 15, 2023:
- Each deficit generator will pay: $50,649
- Each credit generator will pay: $982
Estimated 2023 program budget: $1,865,999
Generators |
Number of participants
as of March 15, 2023 |
Amount
(percent of program cost) |
Deficit generators |
35 |
$1,772,699 (95%) |
Credit generator |
95 |
$93,299 (5%) |
Process for setting the fee
We posted the estimated budget and estimated fee for 2023 on Feb. 1, 2023, with a 30-day public comment period. The estimated fee is based on the number of registered participants on Jan. 30, 2023. We received seven comments during the public comment period.
Estimated 2023 program budget: $1,865,999
This estimate includes:
- Agency staffing costs: $1,018,919
- Other costs (e.g., developing WFRS, fuel-supply forecast, cost-benefit analysis): $847,080
Estimated 2023 fee, based on 64 registered participants as of Jan. 30, 2023:
- Each deficit generator may pay: $77,074
- Each credit generator may pay: $2,276
Generators |
Number of participants
as of Jan. 30, 2023 |
Amount
(percentage of program cost) |
Deficit generators |
23 |
$1,772,699 (95%) |
Credit generators |
41 |
$93,299 (5%) |
All participants will pay a small, flat participation fee, to be determined. Deficit generators will pay an additional fee based on the quantity of deficits they generate. The structure will be:
- Category 1 (highest fee) — top 30% of deficit generators, 70% of fee amount.
- Category 2 (middle fee) — middle 30% of deficit generators, 20% of fee amount.
- Category 3 (lowest fee) — lower 30% of deficit generators, 10% of fee amount.
- The lowest 10% of deficit generators will only pay the flat participation fee.
Why charge a fee to credit generators?
Credit generators participate voluntarily in the program. We structured the fee to minimize financial barriers to participation. However, we have administrative costs associated with each credit generator’s participation in the program. We determined that a credit-generator fee was an equitable way to recover those costs.
In response to comments and concerns that the fee could be burdensome to small credit generators, we are delaying invoicing credit generators until the third quarter of 2023, to allow more time to prepare payment.
Why charge a flat participation fee instead of a tiered fee based on the number of credits or deficits generated, or number of gallons supplied to Washington?
We must assess the fee by mid-March 2023 for fiscal purposes. Since reporting does not begin until April, no credits or deficits have been generated yet. For 2023, registration information is the only piece of data we have to base the fee on. Fees for the Clean Fuel Standard structured the 2023 fee as a participation fee only.
In the future, 5% of the program cost will be covered by a flat participation fee split equally between deficit and credit generators. The remaining 95% of the program cost will be covered by deficit generators in tiers, based on the number of deficits generated the previous year.
Will you adjust the fee if more participants register after March 15, 2023?
No. For fiscal purposes, we must set the fee on this date to accurately account for program costs. If the amount collected is higher than the actual program costs at the end of 2023, the 2024 fee will be adjusted to account for that difference. If we adjusted the fee as more parties registered throughout the year, then that could penalize participants who registered earlier in the year.
Why charge the fee to designators instead of credit aggregators?
The fee rule determined that the fee will be paid by credit and deficit generators, as defined in the Clean Fuels Program Rule (WAC 173-424-110):
- "Credit generator" means a person eligible to generate credits by providing clean fuels for use in Washington and who voluntarily registers to participate in the clean fuels program.
- "Deficit generator" means a fuel-reporting entity who generates deficits in the CFP program.
Therefore, the party generating the credits or deficits must pay the fee — not the credit aggregator representing them.