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Tontitown: the timing test
Perhaps the simplest additionality criterion is the timing test. The timing test asks whether the timing of the project is compatible with the notion that carbon offsets played a role in its development.
So, for example, projects that are too old will fail a timing test. No one was considering revenue from carbon offsets thirty years ago when the oil shocks stimulated a flurry of interest in renewable energy. Project developers back then may have had all sorts of reasons for pursuing, say, wind energy, but revenue from carbon offsets were not among them.
Typically timing tests use a strict cutoff. For example, the Chicago Climate Exchange requires that projects be initiated after 1999 if they’re to be eligible for trading on the exchange.
The BusinessWeek article seems to regard timing as a slam-dunk argument against the additionality of the Tontitown project:
Regardless of who deserves credit for taking the initiative, one thing is clear: The methane system was launched long before any promise of carbon-offset sales. In other words, it appears that the main effects of the TerraPass offsets in this instance are to salve guilty celebrity consciences and provide Waste Management, a $13 billion company based in Houston, with some extra revenue.
Ignoring the snark, it’s a bit odd that the article presents this conclusion as so obvious and unassailable that it doesn’t even need to be sourced. The very earliest work on the Tontitown flaring project began in 1999, which meets the CCX deadline. More importantly, in 1999 project developers could easily have anticipated revenue from carbon reductions.
Further, methane flaring at the site didn’t begin until 2003, two years after Waste Management joined the Chicago Climate Exchange as a founding member. Significant upgrades to the project happened as recently as 2006.
Of course, we’ll be digging into this issue as we will all the other ones. We’ve conducted several interviews with project participants that will allow us to construct a complete timeline. But at a preliminary glance, it appears quite likely that the Tontitown project passes a timing test. I’ll be surprised if our expert panel finds any problem here. If anything, the timing of upgrades to the system seem to undercut the article’s assertion that the methane flaring was a response to the groundwater problem.