The Regional Greenhouse Gas Initiative (RGGI) allows participating states to identify and take credit for project-based greenhouse gas reductions outside of the electric sector, which is subject to the RGGI cap-and-trade program.

Participating states limit offset allowances to three project categories, each of which is designed to reduce or sequester emissions of carbon dioxide (CO₂) or methane within the nine-state region.

Offsets are an important component of each state’s CO₂ Budget Trading Program. By recognizing CO₂-equivalent emissions reductions and carbon sequestration outside the capped sector, offsets provide compliance flexibility and create opportunities for low-cost emissions reductions across sectors.

To implement their offset programs, the RGGI participating states cooperatively developed prescriptive requirements for each of the three offset categories. These requirements ensure that awarded CO₂ offset allowances represent CO₂-equivalent emissions reductions or carbon sequestration that is real, additional, verifiable, enforceable, and permanent. All offset projects must be located within one of the RGGI participating states.

CO₂ offset allowances may be used to satisfy a limited portion of a regulated power plant’s compliance obligation. The use of CO₂ offset allowances is constrained to 3.3 percent of a power plant’s total compliance obligation during a control period, or interim control period.

Information for Offset Projects

This section of the website is designed to act as a resource for general information on RGGI’s offset programs and as a portal for offset project sponsors to access the instructions and materials needed to submit relevant project and accreditation applications.

Project sponsors and verifiers should consult links to “Application Process for Project Sponsors” and “Accreditation Process for Project Verifiers” below to learn about relevant application processes. Specific eligibility and prescriptive requirements for each of five project categories are included in the state’s CO₂ Budget Trading Program regulations (7 DE Admin. Code 1147).

Standards for RGGI Offset Projects

The offset programs of RGGI participating states rely upon prescriptive, category-specific requirements to determine eligibility for offset projects to receive awards of RGGI CO₂ offset allowances.

These requirements were developed to ensure that offset projects represent CO₂ equivalent emission reductions that are real, additional, verifiable, enforceable, and permanent. At this time, three project categories for CO₂ offset allowances may be eligible for the award of CO₂ offset allowances.

Proposed offset projects must complete a Consistency Application to demonstrate that projects meet the relevant category-specific requirements. In addition, projects that have been deemed consistent must supply ongoing monitoring and verification reports in order to receive awards of RGGI offset allowances.

Among key components of RGGI’s offset program are provisions that address project “additionality.” Broadly, additionality attempts to address whether incremental greenhouse gas emissions reductions will be achieved from an offset project that would not otherwise have occurred in the absence of the RGGI offsets component.

Additionality is the key criteria for ensuring that offsets projects result in “real” emissions reductions in the context of a cap-and-trade program. Since offset allowances allow an additional ton of CO₂ emitted for each ton reduced, projects must provide assurance that they are achieving emissions reductions that would not otherwise have occurred in the absence of RGGI’s offset provisions.

Application Process for Project Sponsors

Applying to a RGGI participating state for the award of CO₂ offset allowances involves a three-step process:

First, the project sponsor should open a general account in RGGI CO₂ Allowance Tracking System (RGGI COATS) and obtain an offsets project ID. For information about establishing a RGGI COATS general account and offset project ID code, consult the RGGI COATS User’s Guide.

Second, the project sponsor must submit a Consistency Application to the applicable state regulatory agency where the offset project is located to allow the state to evaluate whether the project is eligible in accordance with state regulations.

Third, the project sponsor must submit to the same state a periodic Monitoring and Verification Report for an approved project that demonstrates the CO₂-equivalent emissions reductions or carbon sequestration achieved by the project during the reporting period.

Key Deadlines and Requirements

Offset applications must be submitted to the appropriate regulatory agency in the RGGI state where the project is located.

Key eligibility dates and application submittal requirements for offset projects are as follows:

• For offset projects not involving reforestation, improved forest management, or avoided conversion, the Consistency Application must be submitted within six months after the project is commenced.
• For offset projects involving reforestation, improved forest management, or avoided conversion, the Consistency Application must be submitted within one year after the project is commenced.
• For an offset project located in one participating state, the Consistency Application must be filed with the appropriate regulatory agency in that State.
• For an offset project located in more than one participating state, the Consistency Application must be filed in the participating state where the majority of the CO₂-equivalent emissions reduction or carbon sequestration due to the offset project is expected to occur.

Project sponsors should consult the relevant state’s regulations for detailed eligibility requirements.

Approval Process

A completeness determination will be made within 30 days of project application submission; a consistency determination will be made within 90 days of the completeness determination.

Project sponsors should consult the relevant state’s regulations for more information on the approval process.

Offset Registry and Tracking System

The RGGI participating states have developed an offsets module for the RGGI CO₂ Allowance Tracking System (COATS). While individual states may require state-specific application procedures, COATS is used for all project registration, tracking of offset project submissions and project status, and the award of CO₂ offset allowances.

The offsets module in RGGI COATS:

• Enables offset project sponsors to register offset projects and electronically submit of Consistency Applications and Monitoring and Verification Reports. (Please note: Project sponsors must open a COATS general account in order to complete the application process).
• Enables the public to view, customize and download reports on offset project documentation submitted to RGGI participating states and the award of CO₂ offset allowances.

To view the offsets report please click here.

To open a COATS account, please visit the COATS platform.

For more information on RGGI COATS, please visit the RGGI Emissions and Allowance Tracking web page.

Accreditation Process for Project Verifiers

Consistency Applications and Monitoring and Verification Reports must include a signed verification statement and verification report from a state-accredited independent verifier.

Each independent verifier must be accredited by the RGGI participating state in which the offset project is located, although a RGGI participating state may acknowledge accreditation by another RGGI participating state.

State Recognized Verifiers:

• First Environment, Inc.
• Ruby Canyon Engineering, inc.

Pre-engagement COI Filing

Prior to engaging with an offset project sponsor to provide verification services, an accredited verifier must submit a pre-engagement conflict of interest (COI) disclosure filing to the appropriate regulatory agency in the state where the offset project is located.  This filing is required for disclosure of potential relationships or other issues that could lead to a COI situation between the verifier and the offset project sponsor or a related party.

Independent Verifier Accreditation and Submittal Materials

• Offset Verifier Application for Accreditation
• Accredited Offset Verifier Pre-Engagement Disclosure Submittal

Related Topics:  air quality, carbon, clean air, climate change, emissions, greenhouse gas, rggi