JUICE: Question Authority

By Published On: August 8, 2008

My father’s years in the California Senate and Assembly were the best years of his life. When his political career ended his love of politics did not. He continued to read local, national, and international newspapers in the early morning. His evenings were spent engrossed in books about historical and current politicians and politics. From start to finish, my father was a politician at heart. He passed away last year. Like most politicos, he had the annoying habit of spouting stock phrases when asked hard questions. When queried about his insights into the latest backroom political deal, for example, he’d reply, “It’s all politics.” When I began questioning authority, I asked him for a fuller explanation. My dad would roll his eyes, mutter how obvious the answer was and take a sip of his scotch before going back to his reading. Trying to get beyond the pat response spouted by policymakers as to how best to curb greenhouse gases evokes responses about as informative as my father’s. For months, I’ve listened to state and regional regulators state that a carbon cap-and-trade market is the most cost-effective strategy for attaining much needed greenhouse gas emission cuts. However, when state and regional regulators insist it is a no-brainer strategy for tackling climate change, they fail to back the assertions with solid proof. “It’s all politics,” rings in my ears. Last week, for example, the regional organization created by California, other western states, and Canadian provinces to curb carbon emissions, took its last round of public input on the regional cap-and-trade proposal released July 23. Although touted as an essential and effective strategy for ameliorating global warming, no tangible economic assessment was presented to support this conclusion at the July 29 meeting. And, this was the last meeting taking public input on the issue prior to release of the final plan. The same thing occurred in June when the California Air Resources Air Board released its scoping plan under the state climate protection law, AB 32. The Air Board’s proposal also lacked solid economic studies to support the claim that a carbon trading scheme is crucial and cost-effective. I know it is all politics but I do wonder if this trading emperor has any clothes. The Air Board chair and staff assert that a thorough economic analysis will be released some time this month–weeks after the draft plan came out. As of this week, there still was no projected release date. Even more worrisome is that some say the economic study will reveal garments are missing. At a July 31 meeting of the technology committee providing input on the Air Board’s climate change program, Pacific Gas & Electric’s vice president Fong Wan warned the upcoming economic analysis will not meaningfully address power price projections. He pointed out that the Air Board does not have access to market data on recent power procurement deals–green resources or otherwise. Wan said this modeling effort was decades out of fashion–but then again, the utilities are the ones holding the information confidential. The void begs the question: for whom is a carbon cap-and-trade an effective market mechanism? Not ratepayers, although it will be for traders and some of the less polluting utilities and industries. Another key question is how a carbon trading program stacks up to other alternatives? Specifically, is it a more cost-effective option than what? Surely, it is not less expensive than conservation and energy efficiency. When queried on this issue last week, one of the Western Climate Initiative representatives said it was more cost-effective than regulations that require the installation of nitrogen oxide emissions control technologies. However, that’s a boxer shorts to brassiere comparison. There are proven commercial control technologies for nitrogen oxides. Some shape the combustion and others treat the post combustion exhaust. In contrast, carbon dioxide control technologies essentially limit fuel usage. After-combustion technologies to eliminate carbon emissions–be it sequestration or another hoped for fix–haven’t become commercially viable. If the underlying economic analyses are not released to state and regional stakeholders they cannot effectively comment on the proposed scheme, which could include input on how to avoid market pitfalls. As some pointed out during the July 29 Western Climate Initiative workshop in San Diego, those outside the inner circle also are kept from knowing the various positions of state negotiators and sticking points of the debate. For example, coal states want to protect their power industries. If they succeed, it could threaten the cost competitiveness of generators in other states. In addition, carbon reduction mandates wouldn’t be achieved. “What is Utah saying to California?” a stakeholder asked. Furthermore, moving away from a state climate reduction program to a regional one dilutes state stakeholder input. There is no one agency responsible, but numerous bodies in several states. Many of the Western Climate Initiative stakeholder calls are by teleconference and trying to find the California contact for a specific issue is challenging. The Initiative does not provide a list of representatives at the time of the teleconferences, nor are their names listed on the Initiative’s website. I have called the Initiative press person a few times, who said to contact the California representative. However, the spokesperson provided no specific person. Various staffers at the Air Board and California Public Utilities Commission are working on parts of the program, which are little more than general outlines. While the debate over a carbon trading scheme is all politics, it’s one that must be transparent in order to draw attention for the right reasons.

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