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With the release of the EPA Power Plant Rule in June, California’s carbon cap-and-trade program has been held out as a model for other states to follow, making it remarkable that it could shortly invalidate almost a quarter of a million of its offset credits. On May 29, 2014 the California Air Resources Board (CARB) began an investigation into the validity of 4.3 million carbon offsets, and last week the CARB Executive Officer issued a preliminary determination that 231,154 of these offsets face invalidation. If they become void, it will show just how tenuous and mercurial the California market is. A mechanism meant to create permanent emissions reductions can easily be undone. How will this “solution” ever achieve anything if its supposed emissions reductions can be invalidated at a moments notice?

California Carbon Offsets

As I wrote in a blog last year, offsets offer polluters in California a cheaper way to meet up to 8 percent of their required emissions reductions under the state’s cap-and-trade system. In effect, an offset allows a polluter to purchase emissions reductions that happen elsewhere — a landowner in Oregon avoids emissions by not cutting down her forests (cutting down trees releases carbon dioxide into the atmosphere) and can then sell these “avoided” emissions as offsets to an oil refinery, or other polluter, in California. The oil refinery counts these offsets as part of their emissions reductions, while their pollution continues onsite. It’s a pay-to-pollute scam.

The offsets in question in this case come from the Clean Harbor Incineration facility in Arkansas where ozone-depleting substances (ODS), like refrigerant gasses and other highly polluting GHGs, are destroyed and the avoided release of these emissions into the atmosphere count as offsets. However, the destruction process for these gases results in a brine solution — a hazardous slurry of chemical waste sludge.

We need to invest in truly renewable, sustainable energy; stop pretending switching from coal to natural gas will protect the climate; and regulate fossil fuels to keep carbon in the ground and out of the air.

The cause for invalidation of the offsets comes from the facility’s practice of “reclaiming and selling the liquid brine as recycled product for use as a drilling fluid and make up water in oil and gas well drilling, completion, and remediation applications.” As a result of these violations the EPA settled with the facility in early May 2014, requiring Clean Harbors to pay a $581,236 penalty for “improperly identifying and disposing of hazardous waste, improper storage of hazardous waste, and failure to comply with air emissions standards.”

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Essentially, a company generated offsets for preventing ozone-depleting substances from entering the atmosphere while the hazardous waste from their destruction was sold as a commercial chemical product for land application and use in extracting more fossil fuels that will cause more emissions. These are the “solutions” enacted to address our increasingly severe emissions problems. The Government Accountability Office has even found that although offsets go through a verification process, it is subject to problems like fraud and corruption. Too often, offsets do not meet all of the requirements for verification, but they are still released into the market.

Offsets and cap-and-trade waste our time and resources while we continue to reach record levels of CO2emissions and see increasingly severe natural disasters like California’s ongoing drought and the devastation wrought by hurricane Sandy. It’s time our elected officials get serious about stopping climate chaos. We need to invest in truly renewable, sustainable energy; stop pretending switching from coal to natural gas will protect the climate; and regulate fossil fuels to keep carbon in the ground and out of the air.

Demand these things, because right now “solutions” like offsets and cap-and-trade only create profits from continued pollution and inaction, while claiming that “something” has been done to reduce CO2emissions and what we’re really left with is nothing.


Elizabeth Nussbaumer
Food & Water Watch