Saturday, January 17, 2009

US-CAP offsets plan

The U.S. Climate Action Partnership released its latest recommended policy actions on climate change - and an offset market is part of their blueprint.  Why is this important?  U.S.-CAP has a very impressive collection of corporate entities and environmental groups that represent a very influential block.  (To see the list of US-CAP members, click here.)

So - what did they have to say about offsets?  Below is an excerpt from their just released summary of their policy blueprint:

Offsets and Other Cost Containment Measures

Adequate amounts of offsets are a critical component of the USCAPBlueprint. Emissions offsets are activities that reduce GHG emissions that are not otherwise included in the cap. USCAP recommends all offsets meet strong environmental quality standards (i.e., they must be environmentally additional, verifiable, permanent, measurable, and enforceable). We recommend that Congress should establish a Carbon Market Board (CMB) to set an overall annual upper limit for offsets starting at 2 billion metric tons with authority to increase offsets up to 3 billion metric tons, with domestic and international offsets each limited to no more than 1.5 billion metric tons in a given year

In addition, the CMB should oversee a system-wide strategic offset and allowance reserve pool that contains a sufficiently large set of additional offsets and, as a measure of last resort, allowances borrowed from future compliance periods that could be released into the market in to prevent undue economic harm in the event of excessively high allowance prices, especially in the early years of the program. USCAP recommends other measures to limit allowance price spikes and volatility including unlimited banking of allowances and effective multi-year compliance period.

Now, I'm not saying this is the best policy for offsets -- but again, take a look at the LONG list of corporations (buyers of offsets) and environmental groups that have signed onto this approach.  Agricultural groups that hope to influence the offsets policy mechanism MUST engage and really understand the full scope of what an offsets market is -- what is the purpose of the product that you would be producing -- and how it fits within the larger climate legislation.  To do otherwise, risks becoming irrelevant in the formation of potentially one of the largest new commodity markets coming for agriculture.

This is a serious time - and we need serious input and all the involvement from ag groups we can get.  Yet still, some of the ag leaders who have followed this issue continue to get criticized for their mere involvement.  As if the whole issue would magically go away if all those in agriculture continue to ignore it!?!

Well, here's your choice -- you can let US-CAP fight for offsets alone -- and shape them alone, or your organization, your commodity can have a voice in shaping a product that you could CHOOSE to provide -- a product that has the potential to be the third or fourth largest crop in America!!

Ag leaders who are following this issue on the industry's behalf should be thanked - continuously.  Their lives should not be made harder because they care about the future and are willing to roll up their sleeves and find a way through this very daunting issue.

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