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Mexico utilizes an emissions trading system as one of its carbon pricing instruments. Mexico’s planning, like that of other countries, includes flexible mechanisms such as offsets. Offsets allow market participants to compensate for their emissions through mitigation projects. Offsetting via participation in the Clean Development Mechanism and Joint Implementation was fundamental to the Kyoto Protocol. In contrast, the Paris Agreement is ambiguous about its use. Other national or regional offset programs, such as the EU, Australia, New Zealand, Japan, or Korea, work within emission trading systems. Subnationally, the California-Quebec program has been in effect since 2014. As Greenhouse Gases (GHGs) are global, offsetting allows market participants to compensate for their emissions through mitigation projects, whether domestically or abroad. Given their global scope, such programs present a wide variability in quality. This chapter presents an overview of offset programs worldwide and argues that non-additionality, overestimated supply, and double counting are their three most pressing quality problems. This analysis sheds light upon the nascent Mexican system and its offset program.

Despite the presence of organized crime in northeastern Mexico, the region has a functioning economy that attracts new investment to energy projects, especially those involving fossil fuels. This may be because legal and illegal markets there tend to overlap and function under hybrid governance schemes. The hybridization of governance is an expression of the fact that legality and illegality are embedded in contemporary capitalist markets. This embeddedness is not an abnormal condition but the way in which societies deal locally with organized crime, and violence serves as the primary regulatory mechanism in disputed territories and markets. A pesar de la presencia del crimen organizado en el noreste de México, la región tiene una economía funcional que atrae nuevas inversiones a proyectos energéticos, especialmente aquellos relacionados con combustibles fósiles. Esto puede deberse a que, ahí, los mercados legales e ilegales tienden a solaparse y funcionar en el marco de los sistemas de gobernanza híbrida. La hibridación de la gobernanza es una expresión del hecho de que la legalidad y la ilegalidad están incrustadas en los mercados capitalistas contemporáneos. Dicha incrustación no es una condición anormal, sino la forma en que las sociedades se ocupan localmente del crimen organizado, y la violencia sirve como el principal mecanismo regulador en los territorios y mercados en disputa.

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