On May 21, 2012, the Regional Greenhouse Gas Initiative (RGGI) released a series of possible changes to its cap-and-trade program, including changes in its offset requirements, auction design, and the control period for reducing carbon dioxide emissions.
RGGI, undertaking a comprehensive review of the program, included the proposals in a report requesting that stakeholders comment on the potential changes. The program is considering a number of possible changes to the current provisions that allow electric generators to offset their emissions with projects like forestation and end-use energy efficiency. Under current provisions, the program has received no applications for offset projects.
Among the potential changes under consideration are expanding the categories of projects eligible for offsets, simplifying the offsets process, increasing the amount of carbon dioxide allowances that can be offset, and expanding the permissible geographic locations for projects.
Other potential changes proposed in the report include creation of a reserve of allowances to provide the program with greater flexibility, replacement of the current three-year control period with a one-year control period; and use of a new mechanism for setting the minimum reserve price for CO2 allowances.