As expected by many, the San Joaquin Valley APCD Governing Board adopted changes to its emissions reduction credit (ERC) banking regulation, Rule 2301 yesterday. The changes will allow reductions in greenhouse gas (GHG) emissions that are in excess of reductions required elsewhere to be sold and/or traded as offsets for new projects that emit GHG.
Whether the new rule changes have any real impact is questionable however. The California Air Resources Board (ARB) has no provision in its Cap and Trade regulations that would allow these banked ERCs to be used. Furthermore, ARB has previously stated that facilities already identified as being subject to Cap and Trade would not be eligible to generate these ERCs.
The APCD has countered by acknowledging there is no current mechanism in ARB's rules to recognize these credits, however, it has also stated that such sources could generate ERCs if they demonstrated that the reductions were in excess of what was required by Cap and Trade. Additionally, the APCD has said the credits could be used for certain CEQA mitigation obligations.
For more information: Governing Board Highlights
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