PG&E ClimateSmart Program

In late June, 2007, Pacific Gas and Electric (PG&E) launched its ClimateSmart program aimed at reducing and sequestering greenhouse gas emissions. PG&E customers who elect to enroll in the ClimateSmart program will pay a small surcharge on their utility bill in order to offset the greenhouse gas “footprint” associated with their monthly use of gas and electricity. These funds will be used to pay for up to 250,000 tons of greenhouse gases reductions in the accepted projects. The ClimateSmart program is the first of its kind in the nation and provides and real source of funding for greenhouse gas emission reduction, avoidance, and sequestration projects in California.

On June 28,2007, PG&E issued a request for greenhouse gas emission reduction projects from the forest and livestock manure management sectors. Forest-based carbon sequestration and livestock manure management projects will be selected by a competitive bidding process. The program will only invest in projects for which there are approved project protocols from the California Climate Action Registry (Registry), a nonprofit organization established by California law as the voluntary registry for greenhouse gas emissions, and accepted by the California Public Utilities Commission (CPUC). All the projects selected by PG&E will be verified by trained, independent, third-party certifiers and registered with the California Climate Action Registry.

The 2007 Competitive Solicitation requires project offers be submitted by the end of July, 2007 with the execution of agreements to occur in early 2008. To receive information about the program and future Climate Smart solicitations, register here.

Livestock manure management projects are aimed at capturing methane emissions associated with livestock operations. Methane is an extremely potent greenhouse gas—21 times more potent that carbon dioxide. These project protocols are aimed at dairy operations in the state.

Forest carbon sequestration projects are based on the natural process of photosynthesis, whereby trees turn carbon dioxide from the air into wood. Forests store carbon in trees trunks, roots, and branches and in soils. As long as trees continue to grow, they continue to sequester carbon from the atmosphere. Additionally carbon is stored in wood and wood products until either through decomposition or combustion, the stored carbon is released back into the atmosphere as carbon dioxide gas. Forest projects are planned activities on forestland that remove, reduce, or prevent the emissions of greenhouse gases into the atmosphere and/or increase the forest carbon stocks. The Registry protocols for forestry projects include forest management, reforestation, and conservation or avoided deforestation in California. Additional protocols are being developed for fuels reduction on forestlands and urban forestry.

The funding available for forest and livestock manure management projects will depend on the voluntary enrollment of PG&E customers. It is anticipated that this program will generate about $20 million in its first three years, 100% of which will go to funding offset projects in California. The goal is to remove 2 million tons of CO2 from the air, which is the equivalent of taking 350,000 cars off the road for one year

The Sierra Nevada, as one of the most heavily forested regions of the state, has much to offer this and other programs designed to help people offset their emissions. PG&E’s ClimateSmart program is the first of its kind, but interest in mitigating climate change is surging among individuals and companies. Demand for verifiable, transparent projects that offset carbon emissions will continue to grow. Greenhouse gas reduction and sequestration credits have become commodities, to be bought and sold in a voluntary market. Through political will and innovative policy measures, California is at the center of this market, and the Sierra Nevada region will see itself at the center of the new “carbon rush”.