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Ned Helme

Ned Helme

Ned Helme, founder of the Center for Clean Air Policy, advises U.S. and foreign governments, on climate and air policy issues. ALL POSTS

Offsets must ensure environmental integrity, reduce emissions

Q: The idea of selling "offsets" for greenhouse-gas pollution seems to be losing some steam -- at least in the U.S. A recent media report said the demand for them is slackening, thanks to the economy, to the failed attempts at creating a sweeping international climate accord in Copenhagen, and to the gridlock on climate on Capitol Hill. Do you think offsets still ought to be part of wide-scale efforts to tackle climate change, either in the U.S. or around the world?

Offsets should continue to be part of the global and U.S. solutions to addressing climate change as long as they ensure environmental integrity and reflect real reductions in emissions. Offsets provide a valuable cost containment mechanism for regulated entities to meet their compliance obligations, and on the international level they can have a valuable capacity building element because developing country partners will see a carbon price value and learn about what constitutes environmentally sound emission reduction efforts.

The declining market demand and price for offsets may be due to the uncertainty about the market post 2012 and the fact that the Copenhagen Accord has not yet been included in a new international treaty. Once the certainty about the architecture of climate policy regulation post 2012 is clear, the price and demand for offsets should rise accordingly. The Copenhagen Accord is a breakthrough because all of the major emitting countries have now inscribed national emission reduction targets or planned mitigation actions and have agreed to a first framework of monitoring, reporting and verification. Further development of this framework in the UNFCCC process and/or through further elaboration of national programs and actions will once again restore the demand for a credible offset market.

The structure of domestic and international offset programs is important to achieve the emission reduction and environmental goals. One way to design an international offset program is to move away from the current project-by-project basis (now covered by the UN Clean Development Mechanism) and toward sectoral credits where developing countries require all plants within a sector (e.g. steel) to be included in the reduction strategy rather than the current system where good deeds are rewarded while continuing bad actors are allowed to avoid any regulation. Parallel definitions of sector-wide credit programs by the US, Europe, Japan and other "buying countries" can create a consistent international standard that ensures offsets are comparable and of high environmental integrity.

On the deforestation front, it is preferable that countries first prove their readiness and capacity to measure, report and verify reductions in deforestation before any credits are issued. Since many programs to reduce deforestation require governmental activity to create incentives for landowners to not deforest and government enforcement activity against violators, a period of reductions that are financed through "funds" rather than through private sector purchases of credits makes sense as a second phase after capacity building and before moving to full crediting regimes.

On the domestic U.S. front, we should get as many sectors as possible into a cap and trade program and allow offsets only to those sectors that do not lend themselves well to direct regulation. Given the size of reductions that are needed to meet the 80 percent reduction below 2005 levels by 2050 included in the Waxman-Markey bill, it is imperative that as many sectors of the US economy are included in either the cap and trade program or a parallel traditional regulatory program rather than in an offsets regime.

By Ned Helme  |  March 19, 2010; 12:00 PM ET Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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I see where the IPCC and the World Wildlife Fund are holding tight to their predictions of disaster in the Amazonian forests. Possibly that is because the WWF has locked up rights to huge areas and is negotiating for even more. The WWF can then bring about a 'reduction in deforestation' and make billions selling the carbon credits.

Reducing deforestation is a wonderful way to make money. No one knows how much deforestation might have occurred any way, and money can be made by not doing so much of it.

The beauty of this for the warmists is that the money comes from people who use electricity by increasing their utility bills, but no one has to call it a tax increase. The WWF, the principals in the IPCC, and others in the know will siphon off potentially billions of dollars before the AGW house of cards collapses as natural climate variability swings back to colder weather.

What could be better than free money for the Al Gore's church taken from the pockets of all the people in the country. Most of them will never know they were ripped off, and there isn't any way to get the money back from the ones who stole it. Making a few mistakes in the calculation of global warming statistics isn't hard, we are only talking about a fraction of one degree Celsius (or a little over 1 degree Fahrenheit) over a century, and surely the scientists involved will apologize when their statistics and models fail to predict anything.

In the mean time, better insulation is a good idea because electrical rates were going to go up anyway, and if these ripoff carbon offsets become law they will go up a lot more.

Posted by: AGWsceptic99 | March 20, 2010 4:00 PM
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It's a scam based on fraud and hoax.

Posted by: JohnMD1022 | March 20, 2010 6:15 AM
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