Link to RECLAIM TRADING CREDIT (RTC) Price Information
- A new way of doing things
RECLAIM is a revolutionary new approach to air quality regulation. This program has the potential to clean up our air more effectively than traditional regulations by harnessing the power of the marketplace. For businesses, RECLAIM means greater flexibility and a financial incentive to reduce air pollution beyond what clean air laws and traditional command-and-control rules require. For the public, RECLAIM means guaranteed annual reductions in air pollution until public health standards are achieved.
- Clean air
This region, the smoggiest in the nation, is required to achieve federal clean air health standards by 2010. Because RECLAIM offers financial incentives to reduce emissions, it is expected to reach that goal at a lower cost with increased flexibility. It requires industries and businesses to cut their emissions by a specific amount each year, resulting in a 70% reduction for nitrogen oxides (NOx) and a 60% reduction for sulfur oxides (SOx)” by 2003.
Businesses that beat their reduction targets can trade their credits on the open market. Using market forces allows pollution to be cut in the most economical way. The more reductions, the greater the asset.
Under command-and-control, almost every piece of equipment that emits air pollution is regulated individually by AQMD.
RECLAIM encloses the facility in an imaginary "bubble." Rather than regulating each source, AQMD regulates the total pollution in the bubble.
The facility must meet targets for annual emission reductions of NOx and SOx.
Facilities that reduce emissions beyond annual targets have an asset to sell.
- Improved public health
Air pollution threatens the health of everyone who breathes in Southern California. Smog and other pollutants can cause everything from watery eyes and fatigue to respiratory disease and cancer. Smog literally eats away paint, rubber, cement--and human lung tissue. By meeting health standards, RECLAIM can reclaim the quality of life we all deserve.
- Flexibility and cost savings for businesses
Traditional regulations, known as command-and-control, set specific limits on each piece of equipment and each process that contributes to air pollution. RECLAIM is different. It sets a factory-wide pollution limit for each business, and lets businesses decide what equipment, processes and materials they will use to meet their emission limits. Under RECLAIM, these allowable emission limits decline a specific amount each year. Companies are free to choose the most cost-effective, economical ways to reduce pollution.
Companies that are innovative and can reduce emissions more than required can then sell excess emission reductions to other firms. Buyers of the emission reduction credits are companies that need more time to clean up or find the cost of buying credits cheaper than buying and installing new equipment.
- RECLAIM trading credits
Each firm participating in RECLAIM will receive RECLAIM trading credits equal to its annual emissions limit. Credits are assigned based on past peak production and the requirements of existing rules and control measures. Credits are assigned each year and can be bought or sold for use within that year. Facilities must hold credits equal to their actual emissions. They can sell excess credits to firms that cannot or choose not to meet their limits. Because businesses are different, some can reduce emissions more easily and at less cost than others. The SCAQMD maintains a list of all parties holding credits. No matter who buys or sells credits, RECLAIM requires that total emissions from all participating companies be reduced each year.
- Changes for a variety of companies
Participation in RECLAIM started with facilities that emit four or more tons per year of either nitrogen oxides (NOx) or sulfur oxides (SOx) from permitted equipment. These companies represent a significant share of the smog-forming emissions from business and industry in the South Coast Air Basin.
- Taking advantage of new technologies
RECLAIM encourages the use of the latest and cleanest technology and the development of even more advanced processes. To monitor emissions at larger sources, RECLAIM requires use of continuous emission monitoring systems to determine actual mass emissions from these sources. These emissions are reported to the SCAQMD on a daily basis.
- Responding to community
SCAQMD developed RECLAIM to help the South Coast Air Basin achieve clean air more efficiently and economically. RECLAIM is the result of three years of planning by SCAQMD staff and committees representing industry, small business, labor, environmentalists, economists, community groups, the state Air Resources Board and the U.S. Environmental Protection Agency.
When did RECLAIM begin?
The RECLAIM program covering nitrogen oxide and sulfur oxide emissions started January 1, 1994. Some facilities participate based on the calendar year (January 1 through December 31); others based on the fiscal year (July 1 through June 30).
If you'd like to get copies of the RECLAIM rules or more detailed reports on the program, contact the South Coast Air Quality Management Public Information Center at 800-242-4666.
SCAQMD is the regional government agency responsible for air pollution control in the nation's smoggiest area--Los Angeles, Orange and Riverside counties, and non-desert San Bernardino County.