The Role of Offsets in a Greenhouse Gas Emissions Cap-and-Trade Program: Potential Benefits and Concerns
"If Congress establishes a greenhouse gas (GHG) emissions reduction program
(e.g., cap-and-trade system), the treatment of GHG emission offsets would likely be
a critical design element. If allowed as part of an emissions program, offsets could
provide cost savings and other benefits. However, offsets have generated concern.

An offset is a measurable reduction, avoidance, or sequestration of GHG
emissions from a source not covered by an emission reduction program. If allowed,
offset projects could generate “emission credits,” which could be used by a regulated
entity (e.g., power plant) to comply with its reduction requirement. Offsets could
include various activities:

! agriculture or forestry projects: e.g., conservation tillage or planting
trees on previously non-forested lands;
! renewable energy projects: e.g., wind farms;
! energy efficiency projects: e.g., equipment upgrades;
! non-CO2 emissions reduction projects: e.g., methane from landfills"