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California Cuts Carbon in Bid to Spur Clean Technology Boom

The state's voters backed a plan to cut greenhouse gas emissions back to 1990 levels



newscenter.lbl.gov

SAN FRANCISCO—Voters have turned back an effort to suspend California's efforts to tackle climate change, a wide-reaching program ranging from a cap-and-trade market for greenhouse gas emissions to energy efficiency standards for televisions.

In 2006 California passed a law—the Global Warming Solutions Act (Assembly Bill 32)—that pledged the state to reduce its greenhouse gas emission levels back to 1990 levels by 2020. That's reducing to 427 million metric tons of carbon dioxide and other greenhouse gases emitted per year; current emissions in the state are roughly 525 million metric tons of greenhouse gases and have been projected to exceed 600 million metric tons by 2020 without such efforts.

The California Air Resources Board developed the program, a set of 70 measures, such as a low-carbon fuel standard, an increase in electricity generated from renewable resources to 33 percent, and a cap-and-trade program for 360 utilities, refineries and other emitting industries. The state released its more than 3,000-page rules for that greenhouse gas permit trading program on October 29. "If I'm under the cap, I make more and more money," explains policy analyst Tiffany Roberts of California's Legislative Analyst's Office. "If I'm over the cap, I pay more and more money."

The majority of the efforts are simple standards, however, such as a new limit on energy usage for televisions with more than 42-inch screens. "We're down from 450 watts per television to 125 to 200 watts per TV," says Thom Kelly, acting chief deputy director at the California Energy Commission. "We're estimating that we'll save about $700 million a year just in energy costs."

The low-carbon fuel standard orders providers to reduce the carbon intensity of their fuels by 10 percent by 2020 through efforts such as blending in biofuels that result in less greenhouse gases emitted when burned. That final rule is expected in early 2011, according to transportation expert Daniel Sperling of University of California, Davis, although the board is struggling to understand the greenhouse gas emissions associated with the land both directly and indirectly impacted by growing crops for biofuels. "It really is the single issue holding back the low-carbon fuel standards," he says. "We've got to figure it out."

"We have an obligation to the world to deliver clean, reliable, low-cost energy that is hopefully low carbon, too," adds chemical engineer David Rogers, general manager for climate change at Chevron, a California-based oil company that did not join efforts to suspend California's climate change initiative. "Maybe we can have the best of both worlds: a price on carbon to create an innovative environment for clean technology in California and keep businesses within state lines and not cause an adverse impact on consumers through radically higher prices for transportation fuels or electricity."

In large part, that may be because California hopes its efforts will quickly be followed by other states so that it is not the only state raising the cost of burning fossil fuels. Already, New Mexico will attempt to reduce greenhouse gas emissions from energy use in the state by 2 percent per year, and 11 northeastern states have formed a regional cap-and-trade program.

That said, it does not appear to improve the prospects for climate change action at a national level. Republican gains in the U.S. Congress suggest climate change and energy will not be addressed in the next two years, and a voluntary national cap-and-trade market for companies, known as the Chicago Climate Exchange, will expire at the end of this year.

Then again, it took more than a decade for California's car regulations to be adopted at the national level. That remains the main thing the Obama administration has done to cut greenhouse gas emissions nationally, and it was done via executive order—a method that does not require the congressional ratification. "Washington screwed around and couldn't get it done," says Sperling, who is also a member of the California Air Resources Board that set up the climate change program. "We're going to be adopting [cap-and-trade] in two weeks."

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