Canada Launches Emissions Offset Program to Spur Investment in GHG Reduction Projects
The Government of Canada announced today the launch of a new greenhouse gas (GHG) offset credit system, aimed at supporting the development and implementation of projects that prevent emissions or remove GHGs from the atmosphere.
The new program forms part of Canada’s 2030 Emissions Reduction Plan, the strategy unveiled by the government earlier this year to achieve the country’s interim climate goals, encompassing a broad range of initiatives from carbon pricing and clean energy expansion, to carbon capture development and zero emissions vehicle incentives. Canada introduced a goal to cut GHG emissions by 40% – 45% by 2030 last year, forming the first main step in the country’s pledge to reach net zero emissions by 2050.
Under the new system, registered participants that carry out specific types of emissions reductions projects based on federal offset protocols can generate credits that can be sold to other companies or organizations, in order to meet their own compliance obligations or environmental goals, such as net zero commitments. Projects will generate one credit for each tonne of emissions reduced or removed.
The first federal protocol category, launched today, the Landfill Methane Recovery and Destruction protocol, enables municipalities and other landfill operators to generate offset credits for destroying landfill emissions, or repurposing the emissions into energy. Greenhouse gases from waste account for 7% of Canada’s GHG emissions.
Canada’s Minister of Environment and Climate Change, Steven Guilbeault, said:
“Establishing a federal carbon offset market is a win-win for the economy and the environment. Starting with landfills, we’re putting in place a market-based mechanism to incentivize businesses and municipalities to invest in the technologies and innovations that cut pollution.”
Canada is currently developing four other protocols, expanding the range of projects eligible for the creation of the offset credits, with categories including reductions in emissions from refrigeration systems, improved forest management, enhanced soil organic carbon and livestock feed management. Another offset protocol for Direct Air Capture and sequestration is anticipated to begin development later this summer.
Marie-Claude Bibeau, Canada’s Minister of Agriculture and Agri-Food, said:
“We look forward to the development of specific details on how the agriculture sector can benefit under the federal offset credit system. These will allow our farmers to take advantage of new economic opportunities, while helping meet Canada’s emissions reduction goals.”