Saskatchewan to Release Draft Offset Program Plan

August 13, 2010

Saskatchewan is continuing to move forward with its proposed greenhouse gas (GHG) cap-and-trade program, with draft offset program methodologies expected to be released next month. The guidance documents will supplement the previously released draft regulations – The Management and Reduction of Greenhouse Gases Regulations– which are expected to gain final approval in fall 2010.

Saskatchewan has set a target of reducing GHG emissions to 20% below 2006 levels by 2020. The proposed emissions threshold for regulated emitters is 50,000 tonnes of CO2 equivalent in any year, and regulated emitters will be required to reduce emissions by 2% per year from 2010 to 2019 to meet the 20% reduction goal.

Regulated emitters will be able to purchase offset credits created from activities that have reduced and sequestered GHG in Saskatchewan and that occurred after January 1, 2006. In addition to offset credits, regulated emitters can make so-called “carbon compliance payments” to the Saskatchewan Technology Fund Corporation. Proceeds from this fund will be used to invest in GHG reduction initiatives and research.

The proposed Saskatchewan GHG cap-and-trade program is similar to that of Alberta, where the emissions threshold for regulation is higher at 100,000 tonnes of CO2 equivalent. In response to stakeholder comments regarding liquidity of the markets, the two provinces are considering linking their carbon trading programs.

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