California Air Resources Board

SACRAMENTO - The Air Resources Board today announced that the American Carbon Registry and the Climate Action Reserve have been formally approved as offset project registries to help evaluate compliance-grade carbon offsets under California’s cap-and-trade program. The Air Resources Board has also accredited specially trained third-party offset verifiers.

"Today's announcement marks an important milestone in the progress of California's climate program,” said Air Resources Board Chairman Mary D. Nichols. “By authorizing real, permanent offsets from farms, forests, and businesses that are not covered by cap-and-trade, we can reduce the costs of compliance with the program and encourage investments in sustainable practices throughout the California economy." 

Carbon offsets reduce greenhouse gas emissions in sectors such as agriculture and forestry that are not included directly under the cap-and-trade regulation. For example, forests can be managed to ensure that they increase the total amount of carbon stored in the trees, thus removing additional carbon dioxide from the atmosphere.

Each offset credit equals one metric ton of carbon dioxide and, if issued by the Air Resources Board, can be used by companies and facilities to comply with the cap-and-trade regulation for up to eight percent (8%) of each covered entity’s compliance obligation. In this sense, they are the equivalent of a California carbon allowance and, like those compliance instruments, can also be freely sold or traded.

To meet the rigorous requirements of the cap-and-trade regulation every carbon offset credit must be ‘additional,’ that is, over and above any reductions already required by law or regulation. They must also be real, verifiable, quantifiable, enforceable and permanent.  The Air Resources Board currently has approved protocols (methods of accounting to measure the number of tons of reductions achieved) for four types of offset projects:

• Forestry 
• Urban forestry
• Dairy manure digesters
• Destruction of Ozone Depleting Substances

Registries:
Approved offset project registries are authorized to provide their services under the Air Resources Board compliance protocols. Those services include listing and reviewing projects and issuing registry offset credits which may later be submitted to the Air Resources Board for final evaluation and issuance of Air Resources Board compliance offset credits.

The American Carbon Registry is based in Sacramento; the Climate Action Reserve is based in Los Angeles.

Verification:
The Air Resources Board has trained and certified more than 60 independent, third-party verifiers to serve as partners in evaluating the quality of any offset projects submitted for approval. Eleven verification bodies have also been certified. Verification is conducted by teams of accredited verifiers from accredited verification bodies. Verifiers must work through the accredited verification bodies.

Accredited third-party verifiers have extensive backgrounds in related areas before they qualify for Air Resources Board training, including appropriate field and auditing experience as well as the scientific and engineering knowledge required for verification. Third-party verifiers must then go through Air Resources Board training and pass a specialized test.

After the quantity of carbon offsets generated by a registered project is verified, the Air Resources Board reviews the findings prior to issuing compliance offset credits. If the Air Resources Board approves those offsets, they may be used to comply with California’s cap-and-trade regulation.

A list of accredited verification bodies and third-party verifiers will follow. 

Protocols for approved cap-and-trade offsets can be found here: 
https://www.arb.ca.gov/cc/capandtrade/offsets/offsets.htm 

More information on California’s cap-and-trade program can be found here:
https://www.arb.ca.gov/cc/capandtrade/capandtrade.htm