Isra-Mart srl:Carbon emission plan questioned

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The carbon cap-and-trade program California will soon embark on was designed to reduce greenhouse gases while spurring a new generation of eco-friendly technologies to drive a green economy and clean up the air.

Both environmentalists and business leaders, however, say the proposed regulations the California Air Resources Board will vote on next week need much more work before they can accomplish those goals.

“Nobody is happy per se, because you can’t make everyone happy,” said Kristin Eberhard, legal director of energy and climate for the Natural Resources Defense Council.

To some degree, that should be expected of a new rule that is the most ambitious cap-and-trade program ever undertaken in the United States. While other regions of the country have enacted such programs, California’s will be the most extensive, eventually touching 85 percent of the economy when fully under way in 2015.

The program allows companies that emit less carbon than their allotted amounts to sell their unused allowances to companies that pollute heavily, creating powerful market incentives to reduce emissions voluntarily.

The program is part of AB 32, or the Global Warming Solutions Act. It is designed to reduce greenhouse gasses in the state to 1990 levels by 2020, using a variety of measures. The cap-and-trade program is expected to produce about 20 percent of those reductions.

It sets a cap on the amount of carbon pollution that large facilities can emit, with that cap decreasing over time.

Process being watched

More than 600 high-polluting facilities around the state that are run by 360 companies initially will receive allowances equal to the amount of pollution they currently release.

Twelve facilities in Ventura County will be directly affected. The regulations address emissions at their source, where power is generated or fuel is burned.

As the cap decreases over time, so will the level of greenhouse gas allowances. Companies can reduce their carbon pollution by utilizing green technologies expected to emerge as the program moves forward. They could then sell their unused allowances or credits on an open market, which has already started trading futures. Companies that don’t decrease their carbon footprints can buy offsets, such as planting trees, to counteract the pollution they create.

The process is being closely watched across the country, as other states are expected to embrace similar measures. But the regulations being established in California are meeting resistance on both sides.

About 200 public comments have been submitted to the Air Resource Board, which is scheduled to vote on the proposed regulations Thursday.

Among the many critics is Shelly Sullivan, executive director of the AB 32 Implementation Group, a consortium of businesses fighting to make sure they aren’t drastically affected as the new rules are rolled out.

“I think this is going to have a tremendous impact on businesses and consumers in the state of California,” she said.

Offsets debated

Among the many concerns she has is “leakage,” in which businesses will just leave the state instead of complying with the regulations.

She also argued there should be a wider range of offsets available to businesses. There are currently four in the regulations, but more are scheduled to be developed.

“There have been too few protocols for offsets approved,” she said. “We would like to see more.”

But too many offsets is exactly one of the problems with the regulations, said Bill Magavern, director of Sierra Club California.

Instead of companies investing in new technologies or cleaning up their facilities to lower their carbon output, they can easily just write a check for an offset, he said.

“AB 32 was sold on the premise that it was going to spur innovation and fundamentally change our economy and the big emitters would find greener ways to operate,” he said. “The point of cap and trade is to spur that innovation.”

He also said offsets can be counterproductive. The club, for example, started a letter-writing campaign asking the air board to tighten regulations so it doesn’t encourage deforestation. Magavern said a company conceivably could clear-cut a forest, sell the lumber, then plant trees to meet the offset requirements.

“A lot of the offsets that have been allowed internationally have been bogus,” he said of other cap-and-trade programs.

Air board spokesman Stanley Young said the program is set up so the first phase doesn’t begin to take effect until 2012, giving companies time to adjust to the regulations. “We are not looking at this whole thing bursting into flower in the first year,” he said.

Only facilities that produce more than 25,000 metric tons of carbon a year would have to comply, leaving many smaller companies out of the regulations.

Serious about action

Officials with the two largest carbon polluters in Ventura County — GenOn, which runs two power generation stations in Oxnard, and Proctor & Gamble Paper Products in Oxnard — did not return calls seeking comment.

“We are serious about taking action in the absence of federal action,” Young said. “Part of the promise and premise of the cap-and-trade program is that we link to other programs when they come online.”

California is part of the Western Climate Initiative, a coalition of Western states and Canadian provinces establishing a carbon trading system. Other regional networks in the nations are also being established. One already exists in the Northeast, but it only covers the utility industry.

Sullivan said that if other states don’t join, it will hamper California’s ability to compete, one of the few points that both sides seem to agree on.

“If California does something that nobody else does, it’s not good enough,” said environmentalist Eberhard. “The good news is that a lot of countries are taking action.”