A cost-effective look at California’s green house gas law

For the last several weeks, both Senate and Assembly Republicans have been outlining proposals that offer “common sense” solutions for many of the budget issues the Legislature will be facing in the coming weeks.

One of the “common sense” proposals that I believe will ultimately better protect the people of California and the environment would be to adjust the deadlines for regulations to implement AB 32.

In their wisdom, the authors of AB 32 gave the governor authority to adjust the deadlines for implementation by up to one year in the case of extraordinary circumstances, catastrophic events, or threat of significant economic harm.

I believe the large and growing state budget deficit and the weakening economy is just such an occasion. Consumers are paying sky-high gasoline prices and they’ve seen their homes drop in value. Employers are absorbing higher costs of production and services, putting pressure on payrolls and job creation. Providing the state flexibility to relax the aggressive timeline for regulations under AB 32 is appropriate under these extraordinary circumstances.

If the Governor were to adjust the deadlines, he could choose to stick with the goal to reducing emissions to 1990 levels by 2020, but we could to meet the goal in a more effective and less costly way.

For example, we could use the time to work with our neighboring states and the federal government to coordinate with their developing strategies to address climate change. We could also use the time to better understand the costs and benefits of different regulatory approaches.  We don’t know the economic and environmental trade-offs for many of the options now on the table.

Take, for example, the effort to lower greenhouse gas emissions from transportation fuels. Many believe ethanol and other biofuels are the solution, not just in California, but in many states throughout the country. However we are learning that ethanol production can hurt our food supply and may even cause more GHG emissions than traditional fuels!

I’m fearful that creating regulations in order to meet artificial deadlines rather than to achieve the best results for California could hurt the economy and might even increase GHG emissions. Ill-considered regulations could lead businesses to choose other locations for new investments and job creation. Let’s avoid unintended consequences by taking the time we need to do it right.

A recent study by the Institute for Energy Research estimated the cost of implementing AB 32 regulations as up to $511 billion. Whatever the estimate, we all want the price tag to be as low as possible for California taxpayers, consumers and employers.

If we give Mary Nichols and her talented staff at the California Air Resources Board more time to develop wise and effective regulations, both the climate and California economy will be well served.