CLIMATE CHANGE ROUNDUP: CARB Tweaks Emissions Allocation Plan for Power Sector

By Published On: March 4, 2011

The California Air Resources Board provided more detail on its plan for allocating emissions rights to the electric power sector under its under its carbon cap-and-trade program. The Air Board plans to account for investments in renewable energy made between 2007 and 2011 as early actions under its program that would reduce greenhouse gas emissions. The Air Board also said it plans to reward energy efficiency programs. Agency staff late last month issued a paper on their recommendations, which were worked out with a group of utility industry representatives. Staff, also is preparing to send its emissions trading rules to the state’s Office of Administrative Law for review. For the overall cap, the Air Board said it would start the electricity sector off with a total allocation that equals 90 percent of the industry’s 2008 emissions. In 2008, emissions were 108.6 million metric tons, including cogeneration plants, so the industry would have to operate within a cap of 97.7 million metric tons in 2012. Allowable emissions would decline to 85 percent of their 2012 value by 2020 under the recommendation, which the Air Board said would amount to 83 million metric tons. That’s a reduction of 14.7 million metric tons from 2012. Air Board staff promised to further refine the numbers before the cap takes effect in 2012. * * * * * California could power 87,550 plug-in hybrid vehicles with 100 MW of new wind power, according to the American Wind Energy Association. A 100 MW wind farm would provide enough power to run the plug-in hybrids 12,000 miles a year at an average cost of 3 cents/mile, compared to more than 14 cents/mile on gasoline at today’s price, according to the industry group. Greenhouse gas emissions would be reduced too, noted AWEA. For instance, federal data show that if an average size sedan like a Chevrolet Malibu was replaced by a plug-in hybrid powered by wind, it would cut greenhouse gas emissions 6 tons a year if driven 12,000 miles. Therefore, federal data show that a 100 MW wind farm completely dedicated to powering plug-in hybrids could trim greenhouse gas emissions from transportation by around a half million tons a year. The utility infrastructure to handle plug-in vehicles is under discussion at the California Public Utilities Commission. * * * * * The U.S. Environmental Protection Agency March 1 announced it is delaying the due date for power plant operators and other industries to report their 2010 greenhouse gas emissions from March 31 until summer. The delay, according to EPA, should give the federal agency time to perfect a new online electronic reporting method for companies to use in filing their data. EPA said it needs to further test the system and get feedback from company tests too before requiring use of the online platform for filing actual reports. The agency hopes to establish a new date certain for filing the reports this summer before this month is out. EPA launched its greenhouse gas reporting program in October 2009. It requires reports from power plants and other large emission sources and fuel suppliers. * * * * * The Securities & Exchange Commission late last month charged seven men for fraud who allegedly “pumped and dumped” the stock of a sham company called CO2 Tech. The stock was available for purchase in California and throughout the nation. Federal attorneys said the company purported to sell greenhouse gas emissions control equipment. SEC attorneys said the scheme--in which stock promoters, traders, and a lawyer allegedly conspired to manipulate the value of the shell company’s stock--brought $7 million in illicit profits between late 2006 and early 2007. Federal prosecutors said the individuals used a Costa Rican company called Red Sea Management to perpetrate the fraud. The federal commission alleged CO2 Tech made many misrepresentations in press releases and on the internet and used manipulative market tactics to pump up the value of its stock so the handful of insiders could dump their shares on unsuspecting buyers. For instance, the company allegedly misrepresented that it had a business relationship with Boeing, a well known technology giant, according to the SEC. The blitz of false publicity, the SEC said, bolted the value of CO2 Tech stock upward by 81 percent in one day. To disguise their allegedly ill-gotten gains, SEC attorneys said the defendants stashed money in bank accounts around the world.

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