Point Carbon has been researching the impacts of proposed US climate policy and announced its findings in a report entitled, “A US cap-and-trade: Options for compliance.” The report utilized supply and demand dynamics under a US cap-and-trade system.
In determining the gap between estimated emissions and the proposed federal cap, Point Carbon analysts find that in 2012 US covered sources will have an estimated annual shortfall of approximately 205 million metric tons (Mt) of carbon dioxide equivalent (CO2e). This gap is anticipated to increase to approximately 571 million Mt by 2015 and up to 1.4 billion Mt by 2020… Domestic offsets will likely be the lowest cost compliance option according to the report, but that supply will fall short compared to potential demand. “International offsets will have to make up the difference,” said Emilie Mazzacurati, Manager for Carbon Market Research North America. “We’ll need sectoral and forestry credits in addition to the Clean Development Mechanism to meet the demand from US emitters.”
There are mitigating factors that might affect the shortfall that the US experiences trying to achieve real emissions reductions, but it is becoming increasingly clear that the US needs to meet its goals with some use of carbon offsets.