Emissions Trading

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Latest Developments…

    The Chicago Climate Exchange announced Oct. 21 it will end its program for trading greenhouse gas emission allowances at the end of the year and instead will become solely a registry for credits from projects that offset emissions. The announcement comes as the market for emission allowances on the exchange has collapsed due to a number of factors, including the lack of any mandatory national emissions cap-and-trade scheme to drive the program, an economy that is struggling to emerge from a deep recession, and emission goals that were achievable with little help from additional allowances or offsets. Even with the shift in emphasis to offset projects, analysts said the 7-year-old Chicago exchange faces an uncertain future without some impetus to increase demand for the credits generated. CCX said its existing carbon emissions offset program will continue, with a new offset registry program initiated for 2011 and 2012. The CCX Offsets Registry Program will include a publicly available registry and a transfer mechanism to process transactions, CCX said in its announcement. More details about how the registry will function are expected to be released in the coming weeks. While the offsets registry will continue, the exchange said it would not renew its voluntary emission reduction commitment program when it expires at the end of 2010. Registry and trading services will remain available through the middle of 2011 for all emission allowances and offset contracts, CCX said.
-- Read more…in Air Pollution Control Guide on regional cap-and-trade programs

Did you know…?
    Emissions trading offers firms incentives to reduce pollution beyond regulatory requirements by giving them emission allowances or credits for reductions below required levels that may be used for future compliance or sold to other firms. This approach is in contrast to the traditional regulatory “command and control approach” in which standards must be met by the installation of pollution control equipment. While cap-and-trade programs exist at the state and regional levels, the United States has not yet created a national emissions trading program for greenhouse gases. The House of Representatives passed a cap-and-trade bill in June 2009 (H.R. 2454), and although the Senate labored for more than a year to pass a companion bill, legislation to limit carbon dioxide emissions ultimately was abandoned in July by Senate Majority Leader Harry Reid (D-Nev.) when he acknowledged the bill was short of enough Democratic support to ensure passage. Although the federal government thus far has been unsuccessful in developing a cap-and-trade program for greenhouse gases, other federal cap-and-trade programs exist or are in development for nitrogen oxides, ozone, particulate matter, and sulfur dioxide.
-- You can find more information on emissions trading in Air Pollution Control Guide