California First With Global Warming Control Legislation

SACRAMENTO, California, August 31, 2006 (ENS) - The California state legislature has approved a bill that is intended to cut greenhouse gas emissions about 25 percent by 2020. By establishing the first government greenhouse gas emissions trading system in the United States, the measure is expected to decrease emissions to 1990 levels over the next 14 years.

California's heavy industry, electric utilities and refineries will be subject to limits on emissions of carbon dioxide, the primary greenhouse gas, emitted when coal, oil and gas are burned. The bill allows for market mechanisms to provide incentives to businesses to reduce these emissions, which have formed a blanket in the Earth's atmosphere, raising the planetary temperature.

The Global Warming Solutions Act, AB32, was passed in the Senate Wednesday by a vote of 23 to 14.

The bill was approved in the Assembly today on a vote of 46 to 31 and now awaits the signature of the governor.

California Governor Arnold Schwarzenegger (Photo courtesy Congressman Terry Everett)

"I am happy to announce we have reached a historic agreement on legislation to combat global warming," Schwarzenegger said Wednesday, after talks with leaders of both houses.

The legislation enacts one of the provisions of the governor's June 1 executive order establishing greenhouse gas emissions targets for the state.

The executive order calls for emissions to be reduced to 2000 levels by 2010; a reduction to 1990 levels by 2020 - the provision enacted - and a reduction of emissions to 80 percent below 1990 levels by 2050.

The governor said legislative leaders have agreed on a flexible program that can be altered if it begins to hurt the state economically.

"My primary concern was that the legislature passed a bill that provided the flexibility to address unforeseen circumstances. AB 32 will ensure that the state can make adjustments throughout its implementation," Schwarzenegger said in a statement.

Assembly Speaker Fabian Nunez represents the city of Los Angeles. (Photo courtesy Assembly Democratic Caucus)

Nunez says the legislation will be good for the California economy, eighth largest in the world. “Not only are we giving the gift of a more stable environment to our children, but we are also creating a whole new sector of California’s economy with the new technologies that will be created to implement the Global Warming Solutions Act of 2006," he said.

The legislation creates a mandatory emissions reporting system to monitor compliance. Greenhouse gas emitters must report "significant" emissions to the California Air Resources Board, ARB.

The ARB is required to adopt regulations to enable a cap and trade program and gives ARB the authority to enforce the regulations beginning in 2012.

Senator Don Perata of Oakland is President Pro Tempore of the California Senate. (Photo courtesy Senate Democratic Caucus)

Conservationists were encouraged by California's action.

"We’ve reached a tipping point in the fight against global warming,” said Frances Beinecke, president of the Natural Resources Defense Council (NRDC). “The whole world has been watching to see whether California passes this bill, and now the world will watch as California takes the lead in developing a clean energy market."

"California is an inspiration for all of us," she said. "Other states, the nation, and other countries would do well to follow California’s example."

The California chapter of Republicans for Environmental Protection, REP, a national grassroots organization, also applauds the agreement.

"The agreement on Assembly Bill 32, the Global Warming Solutions Act, is historic," said Buddy Burke, president of REP's California chapter.

"Climate change is a pressing concern that we can no longer ignore. Public health, water supplies, and farm productivity face significant risks in a hotter, drier world. Governor Schwarzenegger knows that we cannot wait any longer for the federal government to get off the dime," Burke said.

"We commend California’s business, faith based and legislative leaders who made this happen," said Fred Krupp, president of Environmental Defense. "By capping emissions in California, world-class entrepreneurs can dispel the myth that reducing global warming emissions will harm our economy. This provides even more momentum for Washington to act - Americans want action on global warming."

Ann Notthoff, NRDC's California advocacy director, said, "This legislation gives Governor Schwarzenegger a clear path to market incentives to reduce global warming pollution while protecting California’s communities and environment."

But the business community is critical of the new legislation, saying it will drive good companies and good jobs out of California to states or countries that do not have similar restrictions on businesses.

The Shell oil refinery in Martinez California is one facility that will be regulated by the new Global Warming Solutions Act. (Photo credit unknown)

"AB 32 will have a severely negative effect on the affordability and reliability of California’s energy supply, jeopardizing California’s economy and our global competitiveness," said Allan Zaremberg, president and CEO of the California Chamber of Commerce and member of the Sustainable Environment and Economy, SEE, for California.

"In effect, AB 32 imposes a new tax on business only in California, especially through the so-called 'cap and trade' provisions. When businesses that have nothing to trade buy credits, they essentially are buying a permission slip to continue employing Californians and generating tax revenue for the state," Zaremberg said.

SEE California believes that policymakers should pursue alternatives that promote the protection of intellectual property worldwide, fostering and encouraging the transfer of cleaner, environmentally friendly technologies to countries such as China and India - where such action could impact the global problem.

California also should have been exploring tax credits to spur earlier adoption of more efficient generators and manufacturing, among other things, the business group said.

"AB 32 was amended just hours before the end of the legislative session so legislators are being forced to vote for something without knowing the full effects," said Jack Stewart, president of the California Manufacturers and Technology Association and member of SEE California.

"Legislators also won’t have the opportunity to actually vote on the specific greenhouse gas reduction program because the bill allows bureaucrats to develop a program and impose it on us without further legislative review," Stewart said.

While California is the first government to institute a carbon dioxide cap and trade in the country, greenhouse gas emissions are already traded voluntarily in the United States on the Chicago Climate Exchange, CCX. Launched with pilot studies in 2001, CCX is now the world’s first and North America’s only private sector greenhouse gas trading market.

California's capital is hosting the Third Annual Research Conference on Climate Change, September 13-15 at the Radisson Hotel in Sacramento. For more, click here.