The Rice Straw Phase-down Act of 1991 (Act) allowed growers to bank the emissions reductions for each acre they could no longer burn due to the restrictions of the Act.

These phased-down emissions have become known as emission reduction credits (ERCs). Initially, there was a limited period of time growers could apply for these credits. However, there has been a recent change in these rules in some areas. Growers are encouraged to read further to learn more about this recent rule change and other important information regarding their potential opportunities as an "owner" of ERCs.

The ERC is a common tool used in air quality management. It is mostly used when an applicant wants to expand or site a new facility in an area that already has many sources of air pollution. In order to permit this activity in such an area and not worsen existing air pollution problems, air quality officials look to reducing or eliminating emissions from other existing sources. This is generally administered through county air pollution control districts and participation of any sources providing ERCs is voluntary. The air districts authorize and track these ERCs through the use of "certificates" that can be bought and sold in a free market trading environment.

The fact that the Act allows growers to sell the ERCs resulting from a mandated emission control program like the phase-down of rice straw burning, is very unique. In most cases, the ERCs purchased would have to come from new voluntary actions to reduce pollution beyond what is required by mandated programs. In contrast, the Legislature allowed growers to sell their ERCs resulting from the state-mandated rice straw burning phase-down law.

On April 13, 2001, the Sacramento Valley Air Pollution Control Council (Basinwide Council) adopted a revised model rule for ERCs. This is essentially a template available for use by air districts in the Sacramento Valley Air Basin (Basin) to revise their rules. This new rule, adopted by several air districts in the Basin, enables growers to apply for ERCs based upon levels of burning conducted on their land between the "baseline" years of 1988 and 1992. Growers who burned during these baseline years may be eligible for up to 100 percent ERCs and have an unlimited time to apply. Growers who initiated burning after these baseline years should contact their air pollution control district to evaluate eligibility. These growers will qualify for less than 100 percent credit.

Some districts in the southern portion of the Basin will not utilize the new basinwide ERC rule because of a federal air pollution designation called "nonattainment." These air districts (containing rice acres) include Placer, Sacramento, South Sutter, and Yolo Counties.