Developing Sustainable Carbon Credits and Managing Risk
The U.S. is not a signatory to the Kyoto Protocol and as a result, is neither subject to binding GHG emission reduction targets nor is a source of carbon credits. However, in the U.S., carbon offsets may be generated and purchased in the voluntary market.
US pre-compliance project types (according to Climate Action Reserve Protocols) include livestock, municipal waste landfills, coal mine methane, forestry, urban forestry, ozone depleting substances, nitric acid production, organic waste digestion, and organic waste composting.
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Landfill, sewer, wastewater treatment projects capture biogas that would have otherwise been released in the atmosphere and either destroy it by flaring it or preferably use it for energy purposes or. Methane rich biogas has 23 times more global warming potential than carbon dioxide. |
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Livestock projects reduce emissions of methane gas from animal waste. Improved management of waste from dairy, swine, and poultry farming by adopting biogas emission reduction and capture technologies also provides opportunities to generate renewable energy. |
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Coal mining operations release harmful methane emission in the atmosphere. In most cases such emissions are collected for safety reasons and simply vented into the atmosphere. Instead, after proper refining, the gas stream can be utilized to produce electricity or distributed as fuel. |
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Forestry projects focus on natural carbon sinks. Deforestation can be avoided by using offset funds to pay for forest preservation or to provide substitutes for forest-based products. California AB32 cap-and-trade scheme includes forestry as one of allowed project types. |
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Coal mining operations release harmful methane emission in the atmosphere. In most cases such emissions are collected for safety reasons and simply vented into the atmosphere. Instead, after proper refining, the gas stream can be utilized to produce electricity or distributed as fuel.
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Under the Kyoto Protocol, Clean Development Mechanism (CDM) or the Joint Implementation (JI), allow regulated entities to offset their emissions through projects that reduce greenhouse gas emissions in developing countries and Eastern Europe. |
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Low quality natural gas extracted with oil or produced during oil and gas refining operations is normally vented or flared at best. Waste gas recovery projects collect such gas and, after proper conditioning, either distribute as fuel or utilize it in generators to produce electricity. |
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Bioenergy projects generate heat and electricity by combusting biological materials, either sourced from agricultural/biomass residues or specifically grown for such purpose. This replaces fossil fuels, such as coal and fuel oil, and reduces carbon dioxide emissions by releasing in the atmosphere only the carbon that was captured during the biomass growth. |
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Cogeneration projects produce heat and electricity simultaneously from the efficient use of fossil or biomass fuel. The higher overall efficiency achieved provides the opportunity for GHG emission reductions. In some cases, waste heat is used to generate cooling via a vapor absorption chiller (trigeneration). |
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In certain applications (heat, electricity generation) emission reductions can be achieved by switching to a less carbon intensive fuel. Common solutions involve converting from coal to natural gas, from oil to LPG or natural gas. Also in this category is the installation of new natural gas fired equipment where coal would have been the common practice fuel of choice. |
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This category includes any industrial process or technology improvement that leads to either a direct reduction in GHG emissions or a reduction in electricity or fossil fuels consumption. Common sectors of application are energy intensive industries as cement production, chemicals and petrochemicals, iron and steel, textile and paper. |
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Waste heat projects recover and reuse industrial process heat flows that would routinely be vented into the atmosphere. Such waste heat is instead utilized in special design boilers to generate steam and produce electricity. |
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Microcredit projects create partnerships with microfinance institutions to finance and distribute household clean energy products. These products reduce use of wood, coal, and fuel oil or promote the adoption of energy efficient devices.
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Renewable energy projects typically include wind, solar, hydroelectric geothermal and biomass power. The common feature is to produce energy without the input of fossil fuels. Renewable energy projects are not currently admissible as offset in any of the proposed US offsets systems. |
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| February 5, 2012 |
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| EU Allowances: |
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| Secondary CER: |
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Source:
European Climate Exchange
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