CO2 Offsets

PDF Print


A RGGI CO2 offset allowance represents a project-based greenhouse gas emission reduction outside of the capped electric power generation sector. At this time, the RGGI States limit the award of offset allowances to five project categories, each of which is designed to reduce or sequester emissions of carbon dioxide (CO2), methane (CH4), or sulfur hexafluoride (SF6) 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 and other co-benefits across sectors.

The RGGI States cooperatively developed prescriptive regulatory requirements for each of the five 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 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 CO2 compliance obligation for each control period. 

Starting in the third control period (2015 - 2017) regulated sources must hold allowances equal to 50 percent of their emisssions during each Interim Control Period (the first two calendar years of each three year control period). CO2 offset allowances may be used to satisfy up to 3.3 percent of a regulated source's compliance obligation during each Interim Control Period.

This section of the website is designed to act as a resource for general information on the offset component of state CO2 Budget Trading Programs and as a portal for offset project sponsors and independent verifiers to access the instructions and materials needed to submit relevant project and accreditation applications.