Alberta Offset System
In addition to the framework provided by the Specified Gas Emitters Regulation and Climate Change and Emissions Management Act there are guidance documents provided by the regulator that further define offset eligibility and assist parties through requirements of project implementation. The Technical Guidance for Offset Project Developers document released by Alberta Environment must be reviewed for a full understanding of the Alberta Offset System.
As of July 1, 2007, the Specified Gas Emitters Regulation requires Alberta facilities that emit more than 100,000 tonnes of greenhouse gases a year to reduce emissions intensity by 12 per cent.
Regulated facilities have four options to meet their regulatory compliance targets:
- Make internal improvements to their operations reducing emissions;
- Purchase Alberta-based offset credits;
- Contribute to the Climate Change and Emissions Management Fund;
- Purchase or use Emission Performance Credits.
Offsets are one of the mechanisms regulated entities may use to meet compliance under the Specified Gas Emitters Regulation. Offset projects must be Alberta-based and meet a number of criteria in order to be submitted for use under the regulation. An offset must originate from a beyond business as usual action (approved project-type) in a non-regulated sector or operation. Additional criteria include:
- Have a government approved quantification protocol for project-type;
- Result from actions taken on or after January 1, 2002;
- Occur on or after January 1, 2002;
- Be real, demonstrable, quantifiable;
- Not be required by law;
- Have clearly established ownership;
- Be counted once for compliance purposes;
- Be verified by a qualified third party; and,
- Have occurred in Alberta.
These are minimum criteria. It is important to note that meeting these criteria does not guarantee that an offset will be eligible for compliance use. All offset projects are eligible for additional government audits and reviews.
The Alberta Offset System at a Glance
There are four key steps to offset creation. Understanding these steps will lead to an understanding of the Alberta Offset System.
- Development of an Offset Project Plan – includes an assessment and description of the baseline and project conditions, as well as explicit sub-plans for quantification, monitoring and QA/QC procedures. The quantification protocol to be used for measurement of offsets must be followed. A potential buyer may use this plan to help them make decisions on investment. A verifier will use this information to verify against.
- Project Implementation – While underway, it is important for the project developer to follow proposed monitoring plans and implement a data management system. Both investors and verifiers will need this information.
- Project Reporting – a detailed project report should outline the activities of the project, any changes from the initial Offset Project Plan, methods and calculations for greenhouse gas emission reductions/removals, time period for the report, and any associated documentation and signatures. Central to reporting is the GHG Assertion, where the developer makes a claim to a certain number of emission reductions (offsets). Verification will be conducted against this report and the Plan, resulting in a Verification Report.
- Offset Project Registration and Submission – Once the Project Report and Verification Report are complete, the Project Developer registers and serializes the verified emission reductions or removals with the Offset Registry. By this time, the GHG assertion in the report and the statement of verification are interlinked and cannot be separated. Serialized offset credits may then be used on both a voluntary or compliance basis but must be displayed as Retired on the offset registry. An offset credit may only be used once.