Mexico's climate change law -- the first federal legislation in North America to mandate carbon reduction -- will take effect next week, yet the ambitious effort may hit some snags along the way, experts said yesterday.

The law sets national carbon reduction targets, including a 30 percent cut in emissions by 2020 and a 50 percent cut by 2050. It also mandates specific efforts like the creation of a national emissions registry and a climate change trust fund and ensures that by 2018, all municipalities with populations greater than 50,000 will capture methane emissions from landfills (ClimateWire, April 20).

"The law establishes a toolkit for the government to provide mechanism and incentives to reduce emissions and to translate to a low-carbon economy," Alejandro Posadas, the representative of Mexico's environment secretariat at the Mexican Embassy to the United States, said during a discussion yesterday in Washington, D.C.

But Mexico's Legislature still must find financing for the efforts in the federal budget, and the financial specifics have not yet been ironed out. "That's probably the main challenge, how these things are going to be financed," Posadas said, adding that constructing the emissions registry to measure and verify carbon emissions may be another challenge and will require "a lot of negotiations with industry." The emissions registry is central to the government's climate effort, as it would be the key accounting instrument for emissions reduction.

Still, there is mutual optimism between California and Mexico in a potential cross-border effort to directly link the offset programs between the two regions. California's law allows international offsets to be used for compliance if they come from states or provinces that have a cap-and-trade program or use a sectoral-offset program, said Adam Diamant, a senior project manager with the Electric Power Research Institute's global climate research program.

Because Mexico's southernmost state of Chiapas is moving ahead with a sectoral REDD (or Reducing Emissions From Deforestation and Forest Degradation) program and has signed a memorandum of understanding with California and Brazil to establish qualifying REDD programs, it is being considered the "first mover" in what could be a joint climate initiative, Diamant said.

But it is not going to be easy, he added, pointing to the need to establish cohesive legal and regulatory institutions within Mexico and a program with international recognition.

"There has to be a way to measure, report, verify, register credits, an institution that does that. There has to be a way to issue offsets; there has to be a way to retire them," Diamant said. "There has to be a legal framework for how -- and this, I think, is the tough one -- how California actually links with Chiapas, and who's got jurisdiction and who's got responsibility and what happens when there's disagreements, and that, I think, could be the ultimate rub."

The climate law was championed and signed into law on June 6 by outgoing President Felipe Calderón. Mexico is the second country to adopt global warming legislation; the United Kingdom was the first.