Carbon Offsets Daily : When do you think the domestic voluntary carbon market will become a compliance market and how will that change affect the environment?
Bonneville Environmental Foundation: If carbon regulatory systems are properly designed, there should be viable markets driven by both compliance and voluntary demand for carbon emission reductions. One cannot substitute for the other.
This is a critical policy issue that is often overlooked by policy advocates in discussing carbon regulation. It is very important that any regulatory program protect the ability of individuals and companies to make choices about where their energy comes from, independent of government regulation.
The precise time when these compliance markets will emerge depends largely on geography. The Northeast states participating in the Regional Greenhouse Gas Initiative (RGGI) are moving fastest, with a cap-and-trade program for the electric utility sector taking effect in 2009. (California, and perhaps other western states, will follow with carbon regulatory systems taking shape over the next four years.)
Importantly, the RGGI model rule provides an allowance set-aside for voluntary renewable energy purchases. A majority of RGGI states have adopted this provision, helping to protect the freedom of energy choice that the voluntary renewable energy market provides.
However, the current federal cap-and-trade proposals do not offer these protections, jeopardizing the ability for individuals and companies to choose renewable energy as a core solution to global climate change. This oversight in the federal proposals can be easily resolved with the addition of provisions to ensure that our choices for renewable energy continue to drive down global warming pollution.