Climate change is a global issue, with people all over the world researching ways to limit human impacts on our climate. In Alberta, we’ve been working on this for a while, like in 2007 when we introduced the Specified Gas Emitters Regulation (SGER). We were the first place in North America to regulate greenhouse gas emissions from large industrial emitters and require them to report and reduce their emissions.
Now with a new provincial climate change framework coming soon, this regulation is being extended to the end of June 2015. This extension ensures a smooth transition from the current strategy to the new framework expected to be in place in the new year.
Right now, the Alberta government is exploring options to address climate change. This includes looking at the innovative approaches and partnership opportunities presented at the recent United Nations conference in Peru.
So what does the Specified Gas Emitters Regulation actually do?
This regulation is THE main driver of greenhouse gas emission reductions in Alberta. Any facility that releases 100,000 tonnes or more of greenhouse gases must reduce its emissions intensity by 12 per cent. This is across all sectors, so it could be anything from a gas plant to a power plant to a landfill to an incinerator.
For facilities that can’t meet this reduction requirement through on-site improvements, the regulation includes three other options:
- Contribute to the Climate Change and Emissions Management Fund
- Purchase Alberta-based offset credits
- Purchase or use Emission Performance Credits from companies that have exceeded their intensity target
Companies that don’t comply with the Specified Gas Emitters Regulation may be fined up to $200 for every tonne over their reduction target.
- Climate Change and Emissions Management Fund
If a facility chooses to pay into the Climate Change and Emissions Management Fund they pay $15 for every tonne over their reduction target, and since 2008 more than half a billion dollars has been paid.
Every year, the Alberta government provides the Climate Change and Emissions Management Corporation with a portion of this fund to invest in projects that help Alberta lower its greenhouse gas emissions and improve our ability to adapt to a changing climate.
To date, the Corporation has invested almost $223 million into 88 clean energy and adaptation projects, ranging from R&D to energy efficiency to conservation to adaptation.
- Offset credits
A carbon offset is when one party receives credit because they reduced their greenhouse gas emissions. That credit can then be purchased by another party to “offset” their emission levels. Think of it this way: you’re taking a flight, but you pay to sponsor the preservation of a rain forest section to counteract the amount of jet fuel the plane emits into the atmosphere.
Offset credits are available to facilities that emit less than 100,000 tonnes of greenhouse gases and so are not subject to this regulation. But if they still reduce their emissions and register these offsets with the Alberta Offsets Registry they get one offset credit for every tonne of reduced emissions.
Once registered, the offsets can be sold to other Alberta-based facilities that have not met their reduction targets. The price facilities pay for the offsets is market driven so they vary.
- Emission Performance Credits
Unlike offsets, if a company that IS covered by the regulation (emitting over 100,000 tonnes of greenhouse gases) cuts its emissions intensity to below its reduction target, then it is eligible for an emission performance credit. Like offsets, these credits are used to counteract the emissions of a facility.
Emission performance credits can be banked for future use or traded between facilities owned by the same company. They can also be registered with the Alberta Emission Performance Credit Registry. Once these credits are registered, they can then be purchased by other regulated companies that have not met their reduction target. Also like carbon offsets, the cost for emission performance credits vary because it is market driven.