Climate Change: WCI’s Offset Policy

By Published On: March 9, 2012

The Western Climate Initiative debuted its final recommendations on how its member states and provinces with carbon cap-and-trade programs should regulate and certify emissions offset projects on March 2. The recommendations call for emission reductions from offset projects to be verified by “an accredited third-party verification body” and submitted to the state “prior to the issuance of offset certificates.” The verification statements are to be posted for public review before the state or province issues offset certificates. The recommendations further call for WCI jurisdictions to “ensure permanence” of offsets. When they stem from carbon sequestration projects--like planting trees--any unintentional losses due to such things as fires, droughts, or infestations are supposed to be subject to replacement requirements. The recommendations leave open the option for WCI members to either issue offset certificates on a revocable or non-revocable basis. Only two WCI members--California and Quebec--have adopted carbon cap-and-trade programs to date. WCI originally included a large contingent of western states and Canadian provinces, but now has boiled down to just California and the Canadian provinces of British Columbia, Manitoba, Ontario, and Quebec. * * * * * Natural gas and lower carbon intensity ethanol were among the gainers under California’s low carbon transportation fuels standard, according to data released late last month by the California Air Resources Board. Both low carbon intensity ethanol and natural gas generated more low carbon credits in the third quarter of 2011 than they did in the previous quarters of last year. Overall, there were more credits generated--namely 350,000 tons--in the third quarter than were needed by gasoline and diesel suppliers to meet their emission reduction requirements under the standard, which amounted to just 135,000 tons. Natural gas supplied more than 20,000 tons of credits, while low carbon intensity ethanol supplied about 150,000 tons. * * * * * Coal power may be coming to California. Hydrogen Energy California is on the move again in its efforts to construct a 288 MW power plant that would burn a 75/25 percent mix of coal and petroleum coke, capture 90 percent of the carbon dioxide emissions, and inject them into the ground to raise the pressure of old oil wells in Kern County. It would mean more power and more oil for Californians to burn. HECA--as it’s known for short--reopened its project information center in Buttonwillow last month after a development hiatus during which BP and Rio Tinto sold the project to SCS Energy, a power plant development company based in Massachusetts. The project quietly changed hands last September, according to Mike Carroll, attorney for the new developer. Among the new features planned are to use some of the hydrogen produced when the coal and coke are gasified to produce a million tons of nitrogen fertilizer each year in the agricultural area where onions, alfalfa, and cotton are grown. According to Carroll, the company plans to update its application for a power plant construction license with the California Energy Commission this month and begin construction by summer of 2013. If it can meet those milestones, it should be producing power, fertilizer, and carbon dioxide to recover more oil by 2017. Stiff opposition is expected. * * * * * In the initial proposal for the 2012 update of its integrated resource plan, the Los Angeles Department of Water & Power signaled its intention to phase out coal power before 2027. The staff unveiled the proposal last week to environmental leaders in Los Angeles and shared the proposal with its board of commissioners March 6. Under the early proposal--to be finalized later this year--the muni said that behind its plan are state policies to control greenhouse gases, phase out coal, and transition to renewable energy. In 2010, the department’s resource mix was 39 percent coal, 24 percent natural gas, 20 percent renewable energy, 10 percent nuclear power, 5 percent hydro, and 1 percent energy efficiency. Its 2027 goal is 47 percent natural gas, 33 percent renewable, 8.6 percent energy efficiency, 7 percent nuclear, 3 percent hydro, with the remainder from unspecified sources.

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