Offset project aggregation should be a priority for new and existing cap-and-trade systems.

The California Assembly’s Committee on Natural Resources advanced Assembly Member Eduardo Garcia’s (D) bill aimed at adding aggregation methodologies to California’s carbon program last week. The bill now sits with California’s Appropriations Committee.  This bill mirrors efforts in Oregon’s legislature where aggregation is specifically called out in that state’s proposed cap-and-invest bill.

Streamlining carbon offset project aggregation should be a priority for any state considering, or already managing, a cap-and trade-system. It is widely recognized that carbon offset project development and verification can be an expensive endeavor with largely fixed costs that are independent of project size. For land-based offsets, it typically requires several thousand acres for projects to start breaking even. As a result, the majority of small landowners cannot participate in these markets. Project aggregation, as well as general protocol and verification streamlining, will better enable small landowners to make projects financially feasible.

Several ways to streamline small landowner aggregation include allowing “aggregator” entities that are not a property owner to be offset project owners, establishing clear rules for adding properties and land owners after the project start date, allowing properties to leave an aggregated group provided overall emissions reductions are maintained, clarifying that project owners can be holders of carbon rights only, and establishing less expensive sampling and verification rules for small landowners.

With California and Oregon’s proposed bills, we have the chance to make offset markets much more accessible to rural communities. Let’s get it right.