Greenhouse Gas (GHG) emission reduction (offset) programs have been developed across Canada on a provincial basis to a limited extent. A federal offset program is currently under development with new details on priority project types and key policy elements. The following provides an overview of the regulatory system under which this voluntary program operates, and critical details for potential program participants.
The Federal Backstop Program includes an output-based pricing system (OBPS) for industrial facilities that emit greater than 50,000 tCO2e annually. Jurisdictions in Canada that have not implemented a carbon pricing mechanism are required to use the OBPS program. Facilities operating within these jurisdictions are required to meet sector-specific output-based emissions standards, or provide compensation for exceedances, which may include remittance of offset credits generated under the Federal GHG Offset System. The Draft Federal GHG Offset System Regulations are scheduled for publication in the fall of 2020. To date, two publications have been released, providing insight on what the Federal GHG Offset System might look like.
Under the Federal Offset Program, offset credits can be generated from projects with a start date of 2017 or later. Priority project types identified for Federal Offset Protocol Development include:
- advanced refrigeration systems (i.e., ozone-depleting substances)
- aerobic composting of organic waste
- anaerobic digestion
- landfill methane management
- livestock manure management
- improved forest management
- afforestation/reforestation
- soil organic carbon
As the Federal Offset Program moves forward, potential opportunities to create and recognize offset credits are gaining clarity. GHD’s experience and expertise includes:
- Working with governments to:
- understand GHG emission reduction opportunities and programs
- develop offset protocols
- Working with project developers on:
- engineering design, permitting and construction
- evaluating funding and revenue opportunities (such as income from offset credits)
- developing offset projects, including evaluation of program requirements and eligibility criteria, registration and reporting
- GHG verification and validation for offset projects and industry reporting under the OBPS
Our environmental team is closely monitoring the development of this program, including ongoing work with provinces to identify the offset potential in their own jurisdictions.
For more information about the program, please contact Jenn Packer at Jenn.Packer@GHD.com.
