Colorado clarifies emissions credit trading rules for manufacturers under GEMM 2 program

Colorado's Air Quality Control Commission finalized rule clarifications for the GEMM 2 program, which regulates emissions at the state's 21 largest manufacturing facilities. The rules allow manufacturers that exceed emissions reduction targets to sell the value of those cuts outside Colorado. Carbon capture reductions achieved this year will count immediately toward compliance, even though state protocols are still awaiting EPA approval. The commission also scrapped plans for a compliance fund after manufacturers exceeded the 2030 target of 20% reduction ahead of schedule, cutting collective emissions by 23.4% by end of last year. Environmental groups pushed back on carbon capture counting and on Suncor's plan to meet only 25% of its target through onsite reductions, signaling future rulemaking battles. Midstream oil and gas facilities will enter the credit trading market as buyers starting in 2028, which could tighten credit supply. The rules aim to keep the trading program functional while balancing manufacturer compliance needs with environmental justice concerns.