Joint ICAP/NA2050 Public Workshop: Developing Industrial Benchmarks

In major OECD countries, direct and indirect emissions of GHG from industry account for up to one-third of total end-use greenhouse gas (GHG) emissions. Policymakers at a variety of government levels are considering policies to address these emissions. Benchmarking, which assesses GHG emissions performance across facilities or against a common standard, can be used in various policy approaches, including:

  • Regulation of GHG emissions through a cap-and-trade program, along with free allocation of emissions allowances to industry sectors in proportion to output based on an emissions performance benchmark;
  • Regulatory GHG performance standards, where individual facilities are required to meet an emissions performance standard;
  • Energy efficiency targets, either regulatory or voluntary; and
  • Voluntary performance goals, in which participating companies commit to achieving a particular emissions benchmark by a particular year.

Against this background, the North American greenhouse gas (GHG) regulatory landscape has recently been evolving at both federal and sub-national levels, putting GHG emissions benchmarks up on the agenda of U.S. states and Canadian provinces committed to reducing their emissions. Beyond North America, other jurisdictions are also developing benchmarks as a means to reduce GHG emissions, particularly in the European Union as part of the revision of its emissions trading system (ETS) in preparation of Phase III.

Workshop Objectives

  • Explore approaches to developing industrial greenhouse gas emissions benchmarks that could inform either allowances allocation under a GHG cap and trade program or performance-based GHG (i.e. performance standards) regulations;
  • Gain understanding of current approaches to industry benchmarking, including those being implemented in the EU, California and elsewhere;
  • Examine international best practices to identify appropriate sectors with which to begin benchmarking and how to design benchmarks;
  • Identify benefits of coordinating benchmarking approaches, inter alia with regard to competitiveness and leakage issues;
  • Generally foster broader communication and collaboration on climate policy by the example of benchmarking; and
  • Identify possible next steps for continued collaboration between NA2050 and ICAP.