The Climate Trust assesses the additionality of each project proposal on a project-by-project basis. Applicants should review the following information and incorporate this approach into the presentation of the project's additionality case. We use three common tests to determine a project's additionality.
Test 1: Regulatory surplus
The regulatory surplus test ensures that the project that is occurring is not mandated by any existing law, policy, statute, or other regulatory framework. If it is, then it is assumed that the project is being developed to comply with the law or regulation and thus cannot be considered additional to business as usual.
Key question: Is this project mandated by any existing law, policy or statute?
Test 2: Implementation barriers
The implementation barriers tests are at the heart of the additionality determination process. There are three main implementation barriers tests:
Test 2(a): Financial barriers. This test addresses how offset funding impacts the project in question. Financial barriers tests are generally considered to be one of the more rigorous and stringent tests of additionality. There are two main types of financial barriers a project can face: capital constraint and internal rate of return. The capital constraint test addresses whether a project would have been undertaken without offset funding. The internal rate of return test indicates whether or not a project would have met established targets for internal rates of return without offset funding. There are other acceptable financial barriers tests, but these are the most commonly used.Test 3: Common practice
The common practice test is intended to determine whether or not a project is truly above and beyond “business as usual”. If a practice is widely employed in a field, it is not considered additional.
Key question: Is the project, technology or practice commonly employed in the field or industry?
These tests are based on the Kyoto Protocol's Clean Development Mechanism methodology, as well as the World Resource Institute's Greenhouse Gas Protocol for Project Accounting. It is important to note that there is a certain degree of subjectivity in the assessment of additionality. These tests are based on emerging norms and best practices in the emerging U.S. and international offset markets. These principles and practices are intended to assure that offset projects deliver on their promise-to reduce emissions as effectively as on-site or direct emission reductions.
Other key additionality points
If you have questions or want to discuss a project concept, please contact Senior Project Analyst Peter Weisberg at 503.238.1915 x207.
Step 1: Submit a Project Information Note.
For forestry projects, submit a Forestry Project Information Note
Step 2: Upon The Climate Trust's request, submit a Project Information Document.
Step 3: Negotiate an Emission Reduction Purchase Agreement.