California to Allow Forestry Offsets in AB 32

In late October, the California Air Resources Board (CARB) adopted final rules governing the state's Assembly Bill (AB) 32 cap-and-trade system, scheduled to launch in 2013. As part of these rules, CARB has formally permitted the inclusion of forestry project offset credits in the new California carbon market, including offsets derived from reforestation projects (for details see the approved methodology). While offset allowances will be limited to eight percent of emissions from regulated entities, this decision by CARB stands in contrast to the EU Emissions Trading Scheme (ETS), which prohibits use of forestry credits altogether.