Two nonprofits, including one with operations in Sacramento, were appointed to key roles Friday in California's new cap-and-trade carbon market.
The American Carbon Registry and Climate Action Reserve were named "offset project registries" groups that scrutinize projects designed to curb greenhouse gases.
Their appointment was announced by the California Air Resources Board, which runs the market and held its first auction a month ago for carbon emissions allowances.
Offsets represent an alternative way for California's big polluters to comply with cap-and-trade rules. Along with reducing emissions or buying carbon allowances, companies can invest in projects that curb greenhouse gases by, for example, restoring forests or sealing off methane at dairy farms.
The registries' role is to vet the projects, said Air Resources Board spokesman Dave Clegern. The board has also hired a team of 60 inspectors to scrutinize projects.
American Carbon is based in Virginia and opened a California office in Sacramento in May, said the group's state director Belinda Morris. The group is a part of Winrock International, a foundation tied to the Rockefeller family.
Offsets are a huge but controversial global business. Two groups, the Citizens Climate Lobby and Our Children's Earth Foundation, have sued the state to block the use of offsets as a way of complying with cap and trade.
The groups complain that polluters will get credit for investing in projects that already exist and therefore don't cut emissions any further. The suit is in San Francisco Superior Court.
Separately, California moved a step closer on Thursday toward linking its carbon market with Quebec. The province said Thursday it has approved changes to allow it to join California.
Linkage will create a larger market. California companies will be able to buy emissions allowances from Quebec's government, and vice versa.
California had hoped to lead a broad alliance of Western U.S. states in cap and trade. But so far only Quebec has joined.
That's prompted California polluters to complain that paying for emissions allowances and offsets will put them at a huge cost disadvantage relative to companies in neighboring states. The costs are expected to top $1 billion a year.