Yesterday the California cap-and-trade program hit another milestone. The American Carbon Registry, an approved Offset Project Registry, issued the first compliance offset credits, a significant breakthrough because these offset credits are the first ones that can be used by California companies to comply with the requirements of AB 32, California's greenhouse gas law. The credits were issued for a refrigerant destruction project which collected refrigerants from residential, commercial, and industrial sources. While these gases came from a variety of geographic areas, a significant amount came from California sources like kitchens, garages, basements, and attics.
This is the first of many goals we expect from the offset market in 2013. Earlier this year, the California Air Resources Board (ARB) planted a seed when it launched a process to develop a carbon offset protocol for rice growers. California is the second-largest rice growing region in the U.S., and the ground that is being plowed here, both literally and figuratively, will set the stage for the development of future agricultural offset protocols across the country with practices such as fertilizer management for lettuce and corn.
As the largest uncapped sector under the cap-and-trade program, agriculture represents a major potential to reduce near-term greenhouse gas emissions. Unlike refrigerants, offsets generated by agriculture are perennial and a grower can get a long-term income stream for their practices. Because the U.S. has more than 442 million acres of cropland, agriculture has many opportunities to reduce greenhouse gases.
EDF's research and pilots have demonstrated that it is possible to reduce greenhouse gas emissions, decrease input costs, maintain yields, and generate revenue – all at the same time – creating a win-win for both farmers and the environment.
Consider this: If just 5% of U.S. agricultural land were able to reduce or sequester half a ton of CO2e per acre, more than 11 million tons could be reduced – equivalent to taking more than 2 million cars off the road for a year. By approving the rice offset protocol this fall, the ARB will take the first step toward unleashing this potential.