In 2018, the New York City Council passed the Climate Mobilization Act, a package of bills that represents one of the most ambitious legislative actions taken by any major city to reduce greenhouse gas (GHG) emissions and create new green jobs. The centerpiece of the Climate Mobilization Act is Local Law 97 (LL97), which requires significant GHG emissions reductions from buildings larger than 25,000 square feet beginning in 2024.
As required by the law, the Mayor's Office of Climate & Environmental Justice is studying the feasibility of a citywide carbon trading program to help buildings meet the emission reduction targets.
Carbon trading is a method that incentivizes emission reduction by setting an emission target and allowing parties like building owners to sell or purchase credits based on their emission levels. Buildings that emit less than the target level are granted credits that they can sell. Buildings that emit more than the target level can find ways to reduce their emissions or purchase credits, or a combination of both.
The result of the carbon trading study, due January 2021, will include:
If implemented, the City's carbon trading program will be the first-of-its-kind system in the U.S. to provide building owners across all sectors with alternative options to comply with LL97, ensure long-term investment in frontline communities, and help meet the City's goals to reduce carbon emissions by at least 80% by 2050.
The study is taking place between February 2020 and January 2021 and is divided into three phases.
Phase 1: Discovery (Spring 2020)
Phase 2: Modeling and Scenario Test (Summer-Fall 2020)
Phase 3: Market Design and Implementation Plan (Winter 2020-2021)
Any carbon trading program recommended for implementation through the study needs to meet the following core objectives. The program must: