At the California Air Resources Board's (CARB) September 22, 2016 public hearing, CARB staff presented amendments to the California Cap on Greenhouse Gas Emissions and Market-Based Compliance Mechanisms Regulation, including Compliance Offset Protocols (Cap-and-Trade Regulation). On December 21, 2016, staff released a Notice of Public Availability of Modified Text (Notice). Comments that were received during the formal public comment period for the modified text, as well as further staff analysis, are reflected in proposed modifications in a second 15-day Notice. On April 13, 2017, CARB released a second 15-day Notice of proposed regulation order to the GHG Cap-and-Trade Regulation. CARB received 210 comment letters and made minor modifications to the proposed Regulation. CARB states that none of the edits require recirculation of the text and would therefore allow the regulation to be finalized.

Key changes of the second Notice include:

  • Various modifications to definitions including, but not limited to:  almonds and pistachios industry, boric oxide equivalent, dairy and milk industry, electric power entity, entity type, and offset project data reporter.
  • Additional registration and requirements for account representatives or account viewing as agents.
  • Proposed benchmarks for fluid milk products, butter, condensed milk, milk powder (low heat), milk powder (medium heat and high heat), buttermilk powder, and intermediate dairy ingredients will not take effect until vintage 2019 allocation.
  • Borate mining and processing and soda ash mining and processing have new benchmarks starting vintage 2019.
  • Various assistance and product-based emission efficiency benchmark factors were adjusted.
  • Additional details for auctions, banking, trading, and invalidation of credits were revised or added.

It is likely that the proposed regulation text will be finalized without further changes. The changes will directly affect those industries discussed above for vintage 2019 and not vintage 2018. The mechanism and details for any auction related changes should be reviewed closely by reporters.

Please contact your local Trinity office for more information. The full proposed regulation can be found here.