California Air Resources Board has announced issuance of the first carbon offset credits for cap-and-trade program compliance.
On September 17, 2013, the California Air Resources Board (CARB) announced issuance of 600,000 compliance-grade carbon offset credits for use in the cap-and-trade program. The offset credits will be issued through the Compliance Instrument Tracking System for state-issued carbon allowances. Each offset credit represents one metric ton of carbon dioxide. The current batch of 600,000 offset credits for early action projects and compliance offset projects are expected to be issued by the end of September. The first compliance offset credits pertain to projects under the Ozone Depleting Substances protocol, which requires destruction of ozone-depleting greenhouse gases leaked from refrigerants and foam-blowing agents.
Working of Carbon Market (msu)
Carbon offset credits are generated by emissions reduction projects from sectors not covered under cap-and-trade. Early action projects are CARB-approved voluntary carbon registry protocols established before the onset of cap-and-trade. These projects must provide additional emission reductions that are measurable and permanent. They must be first registered with a CARB-approved carbon registry that reviews and issues registry offset credits, which then undergo stringent third-party verification and a final approval by CARB before they are treated as compliance offset credits.
CARB’s approved carbon offset protocols include Forestry Management, Urban Forestry, Dairy Digester (to capture methane from manure), and Ozone Depleting Substances Destruction projects. CARB-approved offset credits are tradable, similar to carbon allowances, and can be used by regulated entities to meet up to eight percent of their compliance obligations under the cap-and-trade system. They also enable entities to reduce compliance costs as offsets cost less than allowances.
September 18, 2013 via Energy Solutions Forum
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