Ca Ab32 Legislation Comes To A Crossroads

When the state of California opted to run with a far-reaching climate protection initiative

, promising significant reductions of greenhouse gas emissions within state borders, legislators were fairly confident that other jurisdictions would also act aggressively. In concert, such actions would indeed make a significant difference to carbon emissions going forward. However, as is often the problem when looking into a crystal ball, this ideal scenario has not materialized and this has presented a problem for CA, AB32 legislation likely to have to stand alone, with all its consequences.

When it was proposed in CA, AB32 was not essentially meant to be a stand-alone proposition. Within the bill's declarations, the state said in 2006 that the action would encourage "other states, the federal government and other countries to act." As carbon emissions are of course a global issue, individual regional initiatives are all well and good, but cannot restrict carbon emissions enough to make a real difference. In California's case, emissions leakage could take place when neighboring locations have no regulation.

We know that the federal government is painfully slow in moving forward and contentious climate bills often have to take their place amongst other political agendas. Even though the House of Representatives has passed its own bill, the Senate is likely to significantly water down any effect as it considers its alternative.

As the nations who were party to the Kyoto Protocol noted, greenhouse gas emissions cannot be adequately managed unless and until all jurisdictions have some kind of regulatory policy in place. To date, the largest carbon emissions scheme in existence is the European Union's version. As greenhouse gas emissions are of course a global problem, regional initiatives are all well and good, but not the answer.

If carbon emissions are indeed to be reduced by 80% through 2050, as proposed by Kyoto, a unified regulatory program is essential. What happens if the U.S. Senate does not indeed suggest a cap and trade trading scheme, will California "go it alone?" There are many risks to CA AB32 if this turns out to be the case, with risks to the state's economy.

If organizations move out of the state due to the imposition of CA AB32, they will set up locations elsewhere and the emissions sources they create there will negate the reductions made in California as a result. Those organizations that remain in state will find that they are at a competitive trading disadvantage.

Despite considerable opposition in CA, AB32 is likely to go ahead, but there is still room for a relaxation of some of the more onerous limitations to allow flexibility in the timing of emissions reductions through the year 2020, which is the target date set within the legislation.

Individual organizations should watch carefully what happens to CA AB32, no matter where they actually reside within the country. The law indicates how energy consumption and carbon emissions may be regulated one day in every jurisdiction. Consequently, it is in an organization's best interests to make sure that it is efficient and has systems in place to monitor energy and emissions.

by: Daniel Stouffer.

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