Emission Reduction Credits
Emission Reduction Credits (“ERCs”)
Emission Reduction Credits (ERCs) are credits that are generated by facilities that permanently reduce their emissions by a facility shutdown, process change, or installing control technology. There are regulations that manage which reduction in emissions can qualify for ERCs.
ERCs are required by new builds or expansions in EPA classified nonattainment areas. ERCs can be freely traded in most states between all entities. The price of the ERCs is determined by the demand from projects and the supply from entities holding the ERCs. ERCs vary significantly in cost and availability. ERCs have ranged in prices from $150/ton to $1.8 million/ton across the country. There are some areas of the country where projects cannot build due to the lack or cost of ERCs. Call us today to discuss your specific project needs.
ERCs prices have increased dramatically in some nonattainment areas of the county where it has economically made sense to facility to shutdown or move operations into an attainment area and create and monetize the ERCs. We have seen this in California and Texas but may be available in other steps as well. Call us today to discuss your specific facility and ability to generate and sell ERCs.
Discrete Emission Reduction Credits (DERCs)
Discrete Emission Reduction Credits (DERCs) differ from ERC’s in that they are the reductions in emissions that occur over a specified period of time. These offsets are considered to be temporary reductions under permitted levels. DERCs only offset emissions for one year, unlike ERCs which allow a facility to emit into perpetuity. Companies that have a temporary increase in emissions tend to prefer DERCs as opposed to ERCs for offset purposes mainly due to cost.