| Independently Powered Energy News

The only significant support for the California Air Resources Board’s cap-and-trade option for carrying out the state’s climate change law seems to emanate from major oil companies. Other organizations are blasting the plan to move ahead with a carbon cap-and-trade program. Comments on the agency’s revised alternatives’ analysis for carrying out the state’s climate change law, AB 32, are pouring in. The deadline for comments looms Aug. 11 in advance of a scheduled adoption hearing on the analysis slated for Aug. 24. CARB “identified the cap-and-trade program as the option most viable in the short-term and, given the challenges facing [C]ARB and the state, we agree with that assessment,” wrote Western States Petroleum Association president Catherine Reheis-Boyd July 28. She expressed opposition to using direct regulations in place of cap-and-trade as a strategy for cutting greenhouse gas emissions. But water agencies, environmental groups, and a wide variety of business groups pan the cap-and-trade option. They call it largely unnecessary to meet the law’s 2020 greenhouse gas emissions reduction benchmark. Some declare it economically and environmentally misdirected. Typical of the comments the Air Board received is a July 28 letter from California Department of Water Resources assistant deputy director John Andrew. It states the analysis “includes unclear statements and mischaracterizations” about the state’s water plan. Andrew notes the Air Board analysis indicates state water use will grow regardless of what conservation programs water agencies put in place, requiring more energy use. Andrew points out, though, that one of the state water plan’s three scenarios would lead to less water use in the future. Andrew criticizes the Air Board analysis for failing to address how cap-and-trade would affect state water users. Placing transportation under cap-and-trade in 2015 would drive the freight shipping industry that supports the state’s ports and warehouse operations to the Panama Canal and other ports, resulting in no greenhouse gas reductions while damaging California’s economy, wrote Mike Williams, International Warehouse Logistics Association executive director July 27. Communities for a Better Environment attorney Julia May called for direct regulations that cut greenhouse gases in place of cap-and-trade, particularly for petroleum refineries. The environmental group said such things as higher efficiency heaters and boilers, cleaner electricity, and crude oil standards at California refineries could achieve more emissions reductions. At press time, the power industry had yet to weigh in on the revised alternatives analysis, which presents other options for cutting greenhouse gas emissions besides cap-and-trade, including a carbon tax and more direct regulations. * * * * * In light of the California Air Resources Board’s one-year delay in enforcing its carbon cap-and-trade program, the California Public Utilities Commission is slowing its effort to deal with the expected costs and revenues for utilities under the program. The Air Board plans to give utilities free emissions rights and allow the companies to sell them to power generators under its cap-and-trade plan. The CPUC planned to establish rules for how utilities should use the revenue before the Air Board planned to enforce the program in 2012. However, a CPUC administrative law judge ruled late last month there was no rush to complete the proceeding given the Air Board’s delay until 2013. The judge also denied utilities the right to use any emissions rights proceeds that may come in 2012, at least until it sets rules governing use of the money.

No Result