Use of Short-Term Credits
Expand the use of short-term credits such as MSERCs, ASCs, and ERC shares, by allowing sources to combine short-term credits together to create a stream of credits. Also, expand the applicability of existing mobile and area source pilot credit generation rules and develop new mobile and area source credit generation rules that can be approved by CARB and EPA.
 

ERC Sharing
Allow a facility that is holding onto a stream of unused ERCs to split the stream and sell the first few years of the ERC stream to another facility. The shared portion of the ERC stream can be used as a short-term credit. The remaining portion of the ERC remains as a stream of ERCs at its original value.
 

SIP Offset Budget
Create a set-aside emission account in the State Implementation Plan (SIP) that can be used for compliance with Regulation XIII. SIP Offset Budget will provide a safety net ensuring the availability of emission reductions for Regulation XIII compliance purposes. Sources that elect to use ERCs from the SIP Offset Budget must pay a fee, that will be used to replenish emission reductions in the SIP Offset Budget. To ensure emission reductions are replenished, another feature of the SIP Offset Budget is backstop reductions.
 

Additional Enhancements
In addition to the three major elements recommended to modernize the ERC system, the following enhancements are also recommended:

- Issue all new ERCs in units of pounds per year instead of pounds per day- Extend the ERC application filing period from 90 to 180 days

Lower EIP environmental discount for mobile or area source projects that reduce diesel particulate

- Standardize interpollutant trading protocols- Discourage use of ERCs for non-Regulation XIII compliance purposes.