California plans to revoke offset credits to EOS Climate and Environmental Credit Corp. following an investigation into a hazardous waste plant that violated its federal permit, Bloomberg report.
California operates the biggest carbon market in the US.
Both companies operated projects that delivered ozone-depleting refrigerants to a Clean Harbors facility, in El Dorado, Ark., for disposal. At the time, the facility may not have been in compliance with its disposal permit, according to the investigation.
Because of this, California plans to invalidate 231,154 of the carbon credits generated from the projects in 2012. This represents about 5 percent of the total credits under investigation.
“In the short term, this helps the market because they didn’t invalidate the vast majority of the credits out there,” Jon Costantino, a Sacramento-based senior adviser at law firm Manatt, Phelps & Phillips and executive director of the Association of Carbon Market Participants, tells Bloomberg. “In the long term, I think you’re going to see this invalidation risk becoming a bigger deal.”
Clean Harbors controls about 70 percent of North American commercial incineration capacity and about a fifth of the landfills that can accept hazardous material.