Canada: Environment Canada Unveils Draft Offset System For Greenhouse Gases

Last Updated: August 18 2008
Article by Adam Chamberlain, National Chair, Climate Change Group

Most Read Contributor in Canada, September 2016

Matti Lemmens, Student-at-Law helped with the preparation of this article

This Climate Change Bulletin is part of a series that is prepared periodically by BLG's Climate Change Group to alert our clients to emerging issues and initiatives that are relevant to their businesses and strategic interests. Future Climate Change Bulletins and Alerts will review and consider issues facing various provinces as well as different industrial sectors. Comments and questions are always welcome and should be directed to the authors.


On August 9, 2008, John Baird, the Federal Minister of the Environment, unveiled the draft Canada's Offset System for Greenhouse Gases: Guide for Protocol Developers "the Guide"). There will be a 60-day comment period for the draft Guide. This Guide is the first of three that will be issued for the offset credit system under the Federal climate change plan, Turning the Corner Action Plan, itself published on April 26, 2007, to help in reducing Canada's emissions intensity by 20% from 2006 levels by 2020.

Canada's Regulatory Framework for Industrial Greenhouse Gases

Under the Turning the Corner Action Plan, Parliament issued the Regulatory Framework for Industrial Greenhouse Gas Emissions on March 10, 2008, which includes the offset system, carbon trading, a technology fund, and a credit for early action program.

The Credit for Early Action Program is already underway. The deadline for submitting the Notice of Interest was July 2008, and the submission of Phase I templates is required by September 5, 2008. The Regulatory Framework is to be finalized in late 2009, and will come into force January 1, 2010.

Offset Credit System in Canada

Canada's Offset System for Greenhouse Gases: Guide for Protocol Developers provides detailed information for potential developers on the preparation and completion of an Offset System Quantification Protocol ("OSQP"). An OSQP outlines the method used for identification and measurement of greenhouse gas reductions from eligible projects under Canada's Offset System. This Guide will be a component of the rules establishing Canada's Offset System for Greenhouse Gases, pursuant to section 322 of the Canadian Environmental Protection Act, 1999.

Under Canada's Offset System for Greenhouse Gases, credits will be issued for incremental, real, and verified domestic reductions or removals of greenhouse gas emissions from activities that are not regulated under the Regulatory Framework for Industrial Greenhouse Gas Emissions. These credits can then can be transferred to regulated entities for compliance purposes.

According to the Regulatory Framework for Industrial Greenhouse Gas Emissions, the Federal Government will bear all the initial delivery costs for Canada's Offset System, and no user fees will be collected for approximately 18 months to two years. As well, the Government will also establish a credit tracking system to monitor credits from their issuance to their retirement by use or cancellation for the good of the environment.

The credit creation process is as follows:

  1. Protocol Developer creates a quantification protocol for the project type, and Environment Canada approves the protocol;

  2. Project Proponent applies to have their project registered;

  3. Environment Canada registers the project;

  4. Project Proponent reports the greenhouse gas reductions achieved from a registered project and ensures that a verifier has provided a reasonable level of assurance on the reductions claim; and

  5. Environment Canada certifies the reductions and issues offset credits.

There are several external protocols eligible for the Fast Track Process, as outlined in Annex J of the Guide. In order to participate in the Fast Track Process, submissions of external protocols must be made no later than four weeks from the publication of the final version of the Guide, and can be submitted to Environment Canada throughout the 60-day comment period by filling out the Base Protocol Plan form in Annex A of the Guide. The following rules apply:

  1. The external protocols must be a complete document that has been approved for use by the Kyoto Protocol's Clean Development Mechanism, Alberta's Specified Gas Emitters Regulation, the California Climate Action Registry, New South Wales' Greenhouse Gas Abatement Scheme, France's Offset System, or the Regional Greenhouse Gas Initiative;

  2. If there is more than one protocol for the same project type, the protocol submitted must be the one that most closely meets the requirements of the ISO 14064-2 standard and can most easily be adapted for use in Canada's Offset System;

  3. The protocol must be for projects that could occur in Canada without illegality; and

  4. The protocol must be for projects that will not be regulated under the Regulatory Framework for Industrial Greenhouse Gas Emissions.

The eligible protocols for the Fast Track Process include the following project types: agriculture (livestock feeding and manure, and soils), energy efficiency, forestry, fossil fuel-based energy, geological sequestration, methane management, renewable energy, transportation and waste management among others.

The Workplan for Canada's Offset System will be posted for consultation in early 2009, following the completion of the Fast Track Process. From that point onwards, new project types are expected to be considered every one to two months.

Guidance documents for Project Proponents and Verification Bodies are expected shortly.

Any person may, within 60 days after publication of the draft Guide, file with the Minister of Environment written comments on the proposed document.

About BLG

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.