EMISSIONS

Regional Clean Air Incentives Market

Market Overview

In 1993, the South Coast Air Quality Management District (SCAQMD) enacted the Regional Clean Air Incentives Market Program (RECLAIM). RECLAIM is a market-based cap and trade program to regulate oxides of nitrogen (NOx) and oxides of sulfur (SOx) emissions in the South Coast Air Basin. RECLAIM covers facilities with emissions from stationary sources that emit more than four tons of NOx and/or SOx per year.  There are approximately 300 sources covered under the RECLAIM program.

RECLAIM is a unique program in that, while traditional regulations set specific limits on each piece of equipment, RECLAIM sets facility-wide pollution limits and lets businesses decide what equipment, processes, and materials they will use to meet their emission limits. Under RECLAIM, these allowable emission limits decline a specific amount each year. Companies are free to choose the most cost-effective, economical ways to reduce pollution.

Companies can choose to reduce emissions more than required and can then sell the resulting excess RECLAIM Trading Credits (RTCs).  Since the RTCs are already allocated, there is no need to bank the RTCs, they are available to trade even before the emission reduction occurs.  Companies only need to be certain that they have sufficient RTCs to cover their emissions on an annual basis, thereby allowing the sale of future RTCs to finance the purchase and installation of control equipment.

RTCs, both current year and future years, are transacted annually.  Brokering in the SCAQMD since the inception of RECLAIM, BGC Environmental Brokerage Services is the leading broker in this market.  With the breadth and depth of experience in RECLAIM that is second to none, BGC provides unmatched market access, vital market information to our clients through voice contact, real time market updates on our website and monthly bulletin emails.