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Kate Gordon

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Cap and Trade: California's Best Secret

Posted: 08/09/2012 11:30 am

A new statewide poll in California has mixed results for those of us dedicated to fighting climate change. While the good news is actually great news, the bad news is a call to action.

Let me start on the upbeat side, which recognizes the magnitude of the issue.

The Public Policy Institute of California's 12th annual poll on "Californians and the Environment" found that a strong majority of Californians, 78 percent, thinks that the world's temperature has probably increased over the last 100 years, versus 17 percent who said it probably hasn't. Most respondents, 60 percent, said the effects of global warming have already begun, and even more, 71 percent, support the state law requiring emissions reductions. Their feelings are borne out by hard science, as we know from NASA scientist James Hansen's recent op-ed, in which he definitively links the extreme weather of the past few years with climate change.

More of the encouraging results:
• Majorities favor policies requiring increased energy efficiency for residential buildings, commercial buildings and appliances (77 percent);
• requiring industrial plants, oil refineries, and commercial facilities to reduce emissions (82);
• encouraging local governments to change land use and transportation planning so people could drive less (77);
• requiring all automakers to reduce emissions of greenhouse gases even further in new cars (78);
• and requiring fuel providers to reduce the carbon intensity of transportation fuels at least 10 percent by the end of the decade (79).

But now for the head-scratcher.

California actually already has a law in place to lower emissions: AB32, which aims to reduce carbon levels to their 1990 levels by 2020. But a major mechanism to achieve those goals, a cap and trade program, remains somewhat of a mystery to a majority of state residents. The poll found that 57 percent had never heard of it -- despite the hundreds of news stories on the topic in 2012 alone.

As Californians learn more about AB32, it's critically important that they get the right information.

Well-financed opposition groups are revving up a noisy campaign to block cap and trade from taking effect. Using untruths, half-truths and scare tactics, they're charging that it amounts to a tax, that it would drive businesses out of California, that it would drive up energy costs for consumers.

Let me be clear: Not true. Not true. Not true.

A tax? No. Current state law allows the state to raise revenues from companies engaged in harmful activities. Polluting the air is harmful to public health, causing illness, deaths and higher health-care costs, a huge drain on the family budget and peace of mind. Putting a price on this harmful activity -- much as we put a price on, say, tobacco -- will more accurately account for the true costs of pollution on the state's budget, and will raise an estimated $1 billion in new revenue for California.

Drive businesses away? No. In California's program, a significant portion of the allowances -- 90 percent in the first year -- will be distributed free to utilities and the biggest carbon producers. This will ease the transition toward cleaner operations and give these industries plenty of incentive to remain in the state. If anything, the cap and trade program will bring more business and jobs to California. Look at the success of cap and trade in the northeast states under the Regional Greenhouse Gas Initiative (RGGI): through that program, they've added about 16,000 new jobs in energy efficiency and renewable energy and seen billions of dollars in net economic benefits for the region overall.

Other revenues from carbon allowance auctions will be re-invested in California in the form of support for research and development, commercialization, manufacture and installation of renewable and efficient energy technologies.

Raise energy costs? No. Giving free allowances to utilities in the early years of the program means they won't have to increase electricity rates. If we spend the revenue from the cap and trade program wisely, we might actually see a drop in energy costs.

The RGGI states are saving consumers $1.1 billion on electric bills and $174 million on natural gas and heating bills over the next decade because they invested cap and trade revenue in energy efficiency retrofits. Since the inception of RGGI, Massachusetts has generated $3 to $4 of savings for each $1 invested in energy efficiency.

Those dollars translate into more money in household budgets, which in turn allows those consumers to spend more on other goods and services, helping the overall economy of the region. And energy savings for industrial consumers leads to more efficient and competitive manufacturing and commercial operations -- also a boon for the region.

Despite the clear benefits of policies to address climate change, the federal government and most states have continued to ignore the issue. Not California. AB 32 is the most ambitious program in the United States to combat the pernicious effects of global warming. But the program will only be successful if it is embraced by the California citizens who say they want action on climate change.

I see the PPIC poll as a call to action -- especially for those of us with the luxury of working every day on policy issues we care about. We need to do a better job communicating with our allies communicate about those issues to our allies, policymakers, and the public, to change California's perception of AB32.

California has always been an innovator when it comes to national problem solving, and the poll results suggest it's time to take an aggressive stand against further damage to the atmosphere. The state's approach to the solution, through AB 32, is based on science and economic realities that hold benefits for the environment and for the state economy.

The more that people understand that, and the more we can spread the word, the less anyone will be scared off by half-truths and fear.

 

Follow Kate Gordon on Twitter: www.twitter.com/@katenrg

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A new statewide poll in California has mixed results for those of us dedicated to fighting climate change. While the good news is actually great news, the bad news is a call to action. Let me start o...
A new statewide poll in California has mixed results for those of us dedicated to fighting climate change. While the good news is actually great news, the bad news is a call to action. Let me start o...
 
 
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10:24 PM on 08/13/2012
half-truths and fear

yup, describes this article to a tee
02:52 PM on 08/13/2012
By far the best thing one can do for the planet is having only two children. Less pollution, less overcrowding, less congestion, less water demand, less carbon.....all for free. CA has held per-capita energy use basically flat for a decade ( although some of that was less industrial use) but the state's total energy use has nearly doubled....due to population growth. Cap and trade won't have much effect on the world's total emissions but less growth in CA's population would.
10:51 PM on 08/13/2012
econ1...you are right on! How bout the part where this money the 50-100 billion is allowed to be used for land and housing development!!! How is that green???? Its assinine. They basically took redevelopment which we just shut down after 50 years of complete fraud and made it cap and trade because ALL the things done under redevelopment will now be done under C and T.
01:41 AM on 08/12/2012
per calwatch.org "On our Web site, Katy Grimes has reported on how CARB has set up a special corporation in Delaware to get around California open-government laws. Under Director Mary Nichols, CARB effectively has become a law — and a corporation — until itself, unaccountable to the democratic process and the people CARB allegedly serves."
01:38 AM on 08/12/2012
You guys are gonna lose all credibility...it just came out the Ca air resource board set themselves up as a Delaware Llc to evade ANY transparency whatsoever over how the 50-100 BILLION dollars is spent. Lawmakers also passed bills allowing the money to be spent on housing development and building hospitals....how doe building NEW and more housing reduce greenhouse gases? Why do land developers get this money????
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Robert Fanney
Scribbler
12:41 AM on 08/10/2012
A carbon tax would be a better solution.
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Roosevelt Democrat
03:31 PM on 08/09/2012
California Industrial electric rates are some of the highest in the nation at approximately $0.14/kwh! In comparison Arizona is about $0.07/kwh and Oregon is about $0.06/kwh. When Intel headquartered in Santa Clara, California decides to build new energy intensive microchip factories they don't choose California.

http://www.reuters.com/article/2012/05/01/us-semiconductors-manufacturing-idUSBRE8400N920120501

California's high unemployment rate is not because of the high cost of labor! The planet has always had cheap labor - call them serfs, call them slaves, but the industrial revolution had to wait for cheap reliable energy.

California's high unemployment rate is directly tied to our energy cost!
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Sandy Beaches
Wanna exchange your health insurance?
02:17 PM on 08/09/2012
She claims that there are no new taxes yet concludes by trumpeting a $1 billion increase in revenues from this law. In the following paragraph she claims that the new law will not drive businesses away. Hell, every business who can manage it is leaving California now. There are many others, I'm sure, who would like to do so but cannot for various reasons. A paid mouthpiece, nothing more.
01:50 PM on 08/09/2012
'Be careful what you wish for:

Great article about the carbon tax and what California can look forward to. jfs

Big Carbon

http://hotair.com/archives/2012/08/06/big-carbon/
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01:07 PM on 08/09/2012
It's not that we don't understand cap and trade - how condescending! It's that WE DO NOT WANT IT. It is just another Big Energy/Big Bank giveaway that will not improve anything and will cost us all a fortune in lost ecosystems, wasted money and wasted time!

We want German style Feed in Tariffs for rooftop solar systems under 100kW in size, starting at 25 cents/kWh for the sunniest regions and going up to 35 cents/kWh for foggier regions. Can you hear us now?

Net metering is a joke, and rewards Energy Hogs and punishes anyone who conserves power - a total FAIL for 90% of us. The CPUC's IDIOTIC "Re-Mat" program and RAM program and the LADWP's similarly clunky, corrupt and useless "FIT in name only" are HURTING progress on legitimate FITs.

FITS are the solution that is proven ALL OVER THE WORLD and CA is embarrassing itself and bankrupting us by refusing to implement this solution.

Why does California hate energy reliability, affordability and democracy and love ecosystem destruction and Big Energy dominance over our markets, grid and political process? Why do we have to slaughter millions more acres of wilderness for Big Solar and Big Wind profits when NREL just reported (again) that we have over 76,000 MW of rooftop solar capacity right in our built environment?

NO to Cap and Trade, YES to REAL FITs. There, now you know what we want.
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Sandy Beaches
Wanna exchange your health insurance?
02:18 PM on 08/09/2012
Nailed it Sheila!
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02:23 PM on 08/09/2012
Yes she did 100 % you go Sheila !!! :) Fan & Fav you !!!!!
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06:07 PM on 08/09/2012
Thanks, Sandy, but Gov. Brown has decided that people like us who want affordable, effective, fast, non-deadly solutions that will save the economy and the environment need to be CRUSHED - he says it all the time. He has steadfastly refused our position in favor of deadly, wasteful, expensive, ineffective programs - I really can't understand it. He used to get it...
01:06 PM on 08/09/2012
If the State uses the permit auction revenues to send dividend checks to every Californian, that would get some attention. Accompany it with information about why they are getting this money, and how they can come out ahead by reducing their carbon footprint. Cap & Dividend can make AB32 a populist cause, and offer a comeback to those who call a carbon price a tax. My worry is that all the revenues will be sucked up by big projects like high speed rail, which should be kept separate for political and other reasons.