Comment Log Display

Dear Board Members: 

The Business Council for Sustainable Energy commends the California
Air Resources Board (CARB) for convening a series of public
workshops this summer regarding possible changes to the California
Cap on Greenhouse Gas Emissions and Market-Based Compliance
Mechanisms. BCSE commends CARB for recognizing the importance of
offsets as a tool to ensure cost-effective compliance with the
Cap-and-Trade Program. As you contemplate possible regulatory
amendments, we urge you to consider the measures suggested below to
ensure an ample supply of high-quality offsets is available to
regulated entities. 

The Business Council for Sustainable Energy is a coalition of
companies and trade associations from the energy efficiency,
natural gas and renewable energy sectors, and also includes
independent electric power producers, investor-owned utilities,
publicly-owned utilities, and commercial end-users. Founded in
1992, the Council advocates for policies that expand the use of
commercially available clean energy technologies, products and
services. The coalition’s diverse business membership is united
around the revitalization of the economy and the creation of a
secure and reliable energy future for America. BCSE includes a
number of members in the State of California, including regulated
entities that are subject to the requirements of AB 32; offset
providers; and offset verifiers. The Council and its members have
participated in the development of AB 32 since its inception. A
document about BCSE, as well as a document about the Council’s
recently-released Sustainable Energy in America Factbook 2013, is
attached for your reference. 

The Council has long supported enactment of comprehensive and
market-based climate change and energy legislation and believes a
key feature of any program should be the ability for entities to
generate and purchase offset credits. While the Council encourages
covered entities to undertake internal emission reduction
activities, such as deploying renewable energy and energy
efficiency, to the greatest extent possible, our members recognize
offset purchases as an important complementary tool to help covered
entities manage compliance costs, widen the scope of environmental
benefits and lower economic costs for energy consumers. 

As CARB reviews and updates the Cap-and-Trade Program, BCSE
encourages the following: 

-	CARB should closely monitor the offset market to ensure there is
an adequate supply of offsets; 
-	CARB should continue its efforts to adopt additional offset
protocols, while ensuring that the process for selection of project
types and development of offset protocols is streamlined and
transparent; 
-	CARB should, to the extent possible, build on existing
high-quality offset protocols developed by voluntary greenhouse gas
emission reduction programs; 
-	CARB should enable compliance entities to carry over any unused
portion of their Quantitative Usage Limit to the next compliance
period; 
-	If the Allowance Price Containment Reserve (APCR) is being
depleted, CARB should consider expanding the use of offsets as a
cost containment mechanism. 

The protocols for offset projects that have been approved by the
state of California -- in forestry, urban forestry, livestock, and
ozone depleting substances, as well as those pending approval in
rice cultivation and mine methane capture – will provide
environmental benefits, create new economic opportunities and spur
innovation, as well as serve as an important cost containment tool.
In addition to these protocols, BCSE believes CARB will need to
continue to develop and approve further protocols to ensure an
adequate supply. In particular, we urge CARB to consider high-bleed
pneumatic controller retrofits, nitrous oxide from fertilizer
management in agriculture, organic waste composting and digestion,
grazing land and livestock management improvements, avoided
conversion of grasslands to agriculture, wetlands conservation and
restoration, and similar project types, as activities likely to
deliver high-quality greenhouse gas reductions, provide economic
and environmental benefits within California, and generate
significant potential offset supply from across the United States.


CARB’s currently adopted offset protocols are generally
geographically limited to projects within the United States.
However, the defining text for offsets in the Cap and Trade
regulation allows CARB to adopt offset protocols with a wider
geographic basis, including Canada and Mexico, and includes a
mechanism for including other international offsets when protocols
for these are developed and adopted. BCSE believes that as CARB
considers new offset protocols, there should be consideration of
expanded geographic eligibility for projects, in order to
facilitate greater offset supply. An expanded offset supply will be
particularly important should allowance prices rise to the APCR
prices. 

It is in California’s interest to allow for expanded opportunities
for offset developers to invest in the deployment of clean
technologies for producing long-term greenhouse gas reductions.
Furthermore, the expanded use of offsets is a key cost containment
strategy. If the APCR is being depleted, regulated entities should
be able to manage compliance costs through a reasonable expansion
of use of high-quality offsets. In order to keep allowances prices
at or below the highest tier of the APCR, ARB could also consider
selling additional allowances at the highest tier of the APCR while
preserving environmental integrity by investing the proceeds to
obtain a commensurate amount of emissions reductions via offsets or
other emission reduction activities. 

BCSE appreciates your efforts to move forward with the AB 32
program to reduce greenhouse gas emissions. We look forward to
working with you as you review the program and offer our assistance
to reach out to stakeholders in the State of California regarding
the positive role of offsets in meeting the State’s greenhouse gas
emission reduction goals. 

Please feel free to contact me in the Council’s offices with any
comments or questions. 

Sincerely,

Lisa Jacobson
President