Emission Reduction Credit Trading Systems: An Overview of Recent Results and an Assessment of Best Practices

Byron Swift, Environmental Law Institute
Date Released
September 2002

This report assesses actual experience under the two principal forms of inter-firm emissions credit trading programs used today: emission reduction credit (ERC) trading used for new source offsets under the Clean Air Act (CAA), and discrete emissions reduction (DER) credit programs created in six states since 1995. The report makes a qualitative review of ERC offset programs, and a comprehensive review of state DER programs. It presents data on the actual generation and use of DER credits from 1995-2000, reviews the laws and practices of each state in implementing these programs, and identifies what the authors believe are the best practices for DER credit trading, taking into account both environmental and economic factors.