An 11-year-old carbon registry in the United States has remade itself and launched a new set of accounting rules for companies that want to develop carbon offset projects and trade credits.
What was once called the Greenhouse Gas Registry is now American Carbon Registry, a nonprofit that hopes to position itself as an authority in the U.S. carbon market as the country moves toward adopting a national carbon emissions cap-and-trade program. The group verifies projects that reduce emissions and generates credits for sale.
A carbon cap-and-trade program would require polluters who can't meet government-set emissions requirements to buy credits from those who emit below the limits. The European Union has run a cap-and-trade program since 2003 to nudge businesses into cutting their emissions or paying for failing to do so. The program offers different ways to offset emissions, including investing in cleantech projects, such as renewable energy generation, that are located in developing countries.
Although there is not a national cap-and-trade program in the United States, 10 northeastern states launched a regional program earlier this year (see RGGI Generates $38.5M in Carbon-Permits Sale). Businesses also can buy and sell carbon emissions credits through programs run by private organizations, such as the Chicago Climate Exchange and American Carbon.
American Carbon used the Carbon Market Insights conference in Washington, D.C. on Thursday to announce a set of general rules that will govern emission reduction projects –such as installing solar energy systems or using technology to capture methane gases from landfills – that seek to receive certification for credits that can then be sold. The standards also cover requirements for companies seeking to inventory their emissions and trading credits with one another.
The nonprofit also plans to issue rules specific to different industries, starting with the forestry and agriculture sectors by the end of this year. In the past, American Carbon didn't have those sector-specific rules in place, said Wiley Barbour, founder and chief technical officer of American Carbon, based in Washington, D.C.
Sectors not covered under its new rules will be judged on a case-by-case basis, Barbour said. American Carbon also accepts projects that qualify under protocols set up by some of the established program, such as the Clean Development Mechanism established under the 1997 Kyoto Protocol by the United Nations.
American Carbon claims to be the oldest carbon offset program in the world. Founded by the Environmental Defense Fund and the Environmental Resources Trust in 1997, the registry has been used by companies and organizations such as utility Entergy, sporting goods giant Nike and the World Bank.
Companies that have bought credits through projects registered with American Carbon include Google, which recently purchased credits from a methane capture project developed by Steuben County in New York.
Barbour's ambition is to build American Carbon as a go-to place for companies that need to abide by a national cap-and-trade program. President-elect Barack Obama supports creating such a program, though how long it will take is anyone's guess.
"The government hasn't been able to send a clear signal on what would be counted as an offset. But everything we do is to prepare companies for a mandatory cap and trade," Barbour said.
With the economy in poor health, analysts and climate change policy advocates are concerned that Obama would delay efforts to create a cap-and-trade system, which could prove costly for businesses.
Barbour, who spent six years in the U.S. Environmental Protection Agency's policy office and directed its U.S. greenhouse gas emissions inventory program, said he doesn't expect the federal government to put a cap-and-trade program to be in place until "maybe 2010." Even after the legislation is passed and signed, the EPA will have to hold public hearings and set rules to carry out the law, the process will likely take two more years, Barbour added.
The three-day Carbon Market Insights conference, which ends Friday, features speakers such as the New York Times columnist Thomas Friedman, chairwoman of the Western Climate Initiative Janice Adair and the chairwoman of the California Air Resources Board Mary Nichols.
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