Estuary News, June 2013 PDF - San Francisco Estuary Partnership

9c l i m a t eCap & Trade Roadshow, Six Months LaterIn the last six months, Californiahas held three very special auctions,and the items in question are muchharder to put your finger on than thegilt rim of a tea cup. In this auction,the objects are less tangible — the socalled greenhouse gases, or GHGs,known to warm earth’s atmosphere— but more likely to influence thecourse of human history than anymahogany credenza or dueling pistol.Whenit passedthe CaliforniaGlobalWarmingSolutionsAct in 2006,the goldenstate firmlyembracedthe singularroleof leading our frustratingly reluctantnation on climate change action. AB32 set the goal of returning the stateto 1990 emission levels by 2020 andlaunched a dozen different initiativesto get there, from renewable energyinvestments to a low-carbon fuel standard.It also created the nation’s firsteconomy-wide cap and trade programfor emissions.“Cap and trade covers 85% ofemission sources in California. If weget rid of it, we’re probably lookingat command and control from the AirResources Board,” said Jane Luckhardt,a Downey Brand lawyer andone of 15 speakers at a Bay PlanningCoalition workshop on cap and tradehosted by URS Corps in Oakland thisJune.The program is basically a marketin which you can buy and tradeemissions. The main premise is thatwhile one entity, say an oil refinery,might be able to reduce its GHG emissions50% by replacing some ancientboilers with newer technology for areasonable cost, another entity, say acement maker, might have very fewoptions for reducing emissions. Sothe latter can buy credits from theformer, or other traders, during thenew auctions.“Initially any industrial facilitythat generates 25,000 or moremetric tons of GHG comes underthe cap,” explained environmentaland sustainable development lawyerCleve Livingston, another one of thespeakers. In 2013, these includedoil refineries like Valero, Chevron,and Shell, cement manufacturers,big power plants, and co-generationfacilities at various universities.Under the cap, these emitters havethree years to show compliance, andcan either buy allowances from otherindustries, invest in energy efficiency,or purchase offsets (dairy methanecapture programs, urban tree planting,or forest management — bluecarbon credits from wetlands are notquite yet auction-ready). “The pointis to allow industry to find the mostefficient measures to reduce carbon,”said Livingston.The state has held three auctionsin the last six months, with prices settlingin between $10-$14 per metricton. In the most recent auction, thestate approved 81 entities to bid in theauction for 14.5 million MT in 2013allowances, and 9.56 MT in futures for2016. In this last auction alone, theysold 100% for 2013, and80% for 2016, and raised$117 million to help thestate advance AB 32 andprevent climate pollution.Governor Brown isalready angling to borrowthe auction money,arguing that other AB32 spending programsare “not ready yet forprime time,” accordingto Luckhardt.At least 25% of fundsraised from the auctionsare supposed to go toclimate pollution reductionrelated projectsin the most impactedcommunities. But first these communitieshave to be identified. SpeakerJohn Faust from the state’s Office ofEnvironmental Health Hazard Assessmentdescribed the screening methodhis team is developing, which uses 18environmental and socio-economicindicators ranging from exposures topesticides, toxics, and ozone to thepresence of impaired water bodies ortoxic clean up sites. Indicators alsotry to take into account the sensitivityof specific communities due to poverty,asthma, low birth weight, or thepresence of lots of children or elderlypeople. Faust showcased the newscreening tool at the workshop, whichmaps these communities based onZIP code. A first version of the toolwas released in April, but the team isstill considering improvements.Other speakers covered what BayArea local and regional agenciesare doing in terms of transportationand sustainable development planning,how the state may be impactedeconomically by AB32, how California’sfood processing industry isresponding, and how groups like theEnvironmental Defense Fund are bothchampioning and watchdogging theprogram. Not only can the programserve the public trust, but it is alsoan opportunity for private speculationthat makes some wary.At press time there was someuncertainty about the nitty gritty ofthe future cap and trade programas Morningstar Packing and thecontinued to page 12California’s GHG Emissions (in million metric tons of CO 2 equivalents).Source: Livingston