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Slow start to the year for offset issuances as market awaits influx of forestry credits

January 12, 2017 by Billy Hamshaw

(CaliforniaCarbon.info, Jan 12, 2017) A single livestock project in Indiana was the recipient of this week’s only offset issuance, marking the lowest ever CCO issuances by ARB since the programs commencement in 2013.

ClimeCo’s T&M Hidden View Dairy (CAR1057) livestock project was issued 13k credits for its third reporting period which spanned the duration of 2015. Registered last month, the credits were approved in just 34 days, the 10th quickest for a livestock project.

Hidden View Dairy was also the recipient of this week’s only CCO-3 conversion, as 8k CCO-8s from the project’s second reporting period were converted to CCO’3s under the watchful eye of verifiers Agri-Waste Technology. Credits from the project’s first reporting period surpassed their 3-year timeframe at the start of the month, contributing 14k credits to a total pool of over 5 million offsets immune from invalidation.

ClimeCo, the market’s third largest developer of livestock and ODS offsets, have now delivered over 1 million CCO-0’s to California’s carbon market. As it stands 2,028,974 offsets across their portfolio have been approved by ARB.

Following a prolonged period of gradual price increases, the discount between of CCOs to CCAs has widened slightly as the market adapts to the new floor price of $13.57. Based on average broker-quoted medians golden CCOs have been trading at $11.64 (a discount factor of 11.1%); CCO-3s at $10.65 (19.1%) and CCO-8s at $10.20 (22.8%) at time of writing.

Despite a slow start for issuances in 2017, significant volumes of forestry credits registered towards the end of last year promise to provide a much needed source of volume to the California market over the coming months. Noteworthy projects such as Wyoming IFM (ACR249) and Colville IFM (ACR255) accredited with 5.2 million and 13.4 million ROCs respectively have given rise to a seismic tally of 26 million credits awaiting ARB approval.

ARB’s next offset issuance will take place on the 26th of January.

Billy Hamshaw (billy@californiacarbon.info)

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