Offsets for US Landfills, Coalmine Methane and Natural Gas in Jeopardy

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As the Waxman-Markey bill, The American Clean Energy and Security Act (ACES) H.R. 2454 made its way through Congress in late June, speculation surrounding the availability for landfills, coalmine methane and natural gas transmission projects to be utilized as offsets became increasingly challenged. In ACES, provisions for direct regulation of these sector types make it clear that what are currently core offset categories may be reclassified as Business as Usual.

As it is currently written, ACES would eliminate these project offsets entirely after the start of the program, per Title VIII, Part A, Section 811, which establishes stationary source performance standards covering methane emissions from landfills and other significant sources. Specifically, the bill states that the EPA must identify uncapped methane emission sources individually above 10,000t/year, which are collectively responsible for at least 10% of uncapped economy wide emissions of CO2. Based on the 2005 EPA GHG Inventory Data, total uncapped methane emissions for Landfills (22.9%), Coalmine’s (19%) and Natural Gas Systems (10.2%) clearly exceed this proposed threshold.

The EPA projects that command and control performance standards for these sectors would decrease domestic offset supply by 45% and increase the cost for allowances by as much as 9%. It remains to be seen whether this provision will be changed during the Senate debates.