Announcement creates new opportunities for carbon finance in Atlantic Canada
If a tree falls in the forest and no-one hears, does it make a sound? That old riddle from grade school used to really bother me. Of course it made a sound. It’s the listener’s loss if they’re not there to hear it. No?
Well, the Western Climate Initiative made a big ‘sound’ this week and from the media reaction, or lack thereof, I’m pretty sure no-one heard. While the world focused on the crash and burn of Obama’s cap and trade bill, with little fanfare and almost no media coverage the eleven subnational governments that make up the Western Climate Initiative (WCI) released the final design of a cap and trade system that is intended to reduce their ghg emissions 15% below 2005 levels by 2020.
Eleven major North American governments including big players like California, New Mexico, Ontario, and Quebec institute a fixed cap and trade system that begins in 2012, and from the sound the media made, I coulda heard a pin drop?
No matter, I am well and truly delighted that the biggest carbon policy play to hit North America since FOREVER has been officially launched and is set to begin counting and trading emissions in 2012. The regulations will cover most sectors and will include most of the region’s ghg emissions
For businesses in Atlantic Canada, the most significant part of the new system is the design of the offset program.
The inclusion of offsets means projects that reduce emissions will qualify for credits that can be bought and sold among the WCI participants to help them meet their compliance obligations. WCI system offsets will direct private investment into emission reduction projects by farmers, foresters, communities, and others who will benefit directly from receiving revenue for their emission reducing activities.
A second key part of the design of the WCI offset system is that it allows the participating governments to issue certificates to projects outside of their own jurisdiction. Once this system is up and running, that means projects in Atlantic Canada have the opportunity to register with WCI governments and sell offsets to participants in that program.
Before this WCI development, Atlantic Canada emission reduction projects were limited to speculating on registering their emission reductions in the hopes of making a few bucks on a voluntary exchange or a direct bilateral contract. But those provisional markets are very weak and the prices for voluntary offsets are low and volatile.
The development and maturity of the Western Climate Initiative means that Atlantic Canada offsets can find a market in a compliance based system. That means more value for our offsets and more certainty in project management and design. The WCI rules are transparent and rigorous, following the ISO 14064-2 principles that underlie most good carbon accounting protocols. The same protocols we use at Scotian Carbon.
A whole new world of opportunity for emission reduction financing was opened today for business in Atlantic Canada, whether or not the announcement made a sound in our mainstream media.
Read more about the Western Climate Initiative on their website: http://www.westernclimateinitiative.org/
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