US: Washington willing to discuss using credits from existing US carbon programme

Author: Dan X. Mcgraw

2015/09/28

Washington state officials offered few concrete details during its first webinar, but officials said they are discussing whether Washington compliance entities would be allowed to comply with credits from existing carbon programmes.

Washington Governor Jay Inslee directed the Department of Ecology to develop a carbon market in July. The state agency is working with stakeholders to develop the programme, and the process should take at least a year to develop.

The state department plans to regulate carbon emissions from natural gas distributors, fuel suppliers, power plants and industrials who emit more than 100,000 tCO2e/year. No baseline year has been determined.

Those compliance entities, which would include 30 companies, would be given individual caps and can generate credits by being under that emission limit. Those credits could be sold to other entities to meet their target or banked for future years.

The state would not set a price for credits and would not raise state revenues by operating the programme. State officials said they are looking at whether speculators would be allowed to operate in the programme.

Sara Rees, special assistant to the director for climate policy, said the state is still considering whether emission credits from other programmes could be used in its statewide programme.

“We are willing to discuss it,” Rees said during the webinar.

Washington’s programme would not include power imported or exported out of the state, and it would also exclude fuel exported out of the state. Maritime and aviation fuels would also not be covered.

As expected, the Transalta Centralia power plants, which is the state’s largest emitter, would not be included in the programme. State officials said the programme would capture about 59% of the state’s emissions.

The preliminary design does prevent some potential conflicts with the California carbon programme. California regulates power imported into the state, including power from Washington.

By not regulating those emissions, the two programmes may be able to co-exist.

Washington officials said they hope to have a draft completed by this December and finalised plan by summer 2016. That timeline could allow the programme to serve as the state’s compliance plan for the Environmental Protection Agency’s Clean Power Plan.

The Clean Power Plan would reduce overall US emissions by 32% from 2005 levels by 2030. States would have to submit plans by September 2016. dan.mcgraw@icis.com