How will compliance be determined under the WCI agreement?
The bedrock of a cap-and-trade system is a rigorous emissions reporting requirement. The regulated sources are required to ensure the data are accurate and complete. Each WCI Partner will require third party validation of reported emissions from entities and facilities that will be included under the cap. The WCI agreement is consistent with previous well-designed cap-and-trade programs that have had compliance rates of over 99 percent. At the end of each compliance period, facilities and entities with emissions are required to submit the same number of emission allowances to the government as the emissions they had during that compliance period. If the facility or entity does not have sufficient emissions allowances to cover its emissions, a “penalty” of three allowances will be assessed for each one they are short. The WCI has established the Reporting Committee to develop recommendations on a greenhouse gas emissions reporting system that will support the WCI cap-and-trade program,
