Protecting California’s communities is key to California’s cap-and-trade program

The 2006 Global Warming Solutions Act (AB 32) is a nationally heralded law aimed at cutting greenhouse gas (GHG) emissions to 1990 levels by 2020. To achieve this reduction, the California Air Resources Board (CARB) proposed a combination of regulations and a market-based approach known as cap-and-trade. However, a poorly crafted cap-and-trade program could lead to an increase of the already existing pollution in many highly impacted communities.

When it comes to climate change, low-income communities are at a disadvantage. They are ill-equipped to prepare for or recover from acute climate change episodes, such as heat waves, droughts, flooding, fires or an increase of infectious diseases. On a global scale, low-income communities are increasingly unable to cope with heat episodes, as observed in the recent past in France and Chicago. In 2006, a heat wave crashed over California, killing 145 people and hospitalizing 2,537.

As CARB finalizes its implementation plan, it is essential that it prioritizes protecting impacted communities and ensures that a benefit mechanism is built in to assist them. The Coalition for Clean Air (CCA) advanced a concept of three strategies aimed at protecting and providing for these communities through the implementation of AB 32.

1. Assess and identify impacted communities.

CARB should assess areas currently experiencing a higher air pollution burden and identify them as “hot spots.” Low-income urban communities and many rural communities generally house a high percentage of minority populations at risk from unhealthy levels of emissions from multiple nearby sources. As required by law, AB 32 should be carried out only after considering the potential for emissions impacts in these communities. This assessment should be conducted at the beginning of 2009.

2. Protect and benefit impacted communities

AB 32 was crafted with an intent and requirement to not only protect at-risk communities, but to benefit them as well. The implementation of AB 32 provides several opportunities to generate significant revenues through a credit auction, credit trading or permit fees; CCA is advocating that a portion of the funds generated from any market-based approach, including a cap-and-trade program, be allocated to a Community Benefits Fund. The Community Benefits Fund would help accelerate pollution reductions and support community-level adaptation measures that help communities and local governments cope with episodic climate change impacts.

3. Place limitations on credit purchase and use

In setting up California’s cap-and-trade system, restrictions should be placed on pollution sources located in highly impacted communities to avoid a further increase in pollution levels. In the case that sources in these areas be allowed to temporarily purchase offsets or credits, we recommend that they be required to pay a premium which would be contributed to the Community Benefits Fund to help pay for activities to reduce pollution within the community.  

To avoid potentially disproportionate impacts in communities as a result of GHG emission reduction efforts, we urge CARB to include the following language in the Scoping Plan:

•    CARB will ensure that a cumulative impacts assessment method will be adopted within a year, or prior to the adoption, of any AB 32-related regulation.
•    CARB will identify communities “already impacted by air pollution” cumulatively and ensure uniformity and consistency between the State, the air districts and other local governments, so that communities identified by one agency are not categorized differently by another.
•    CARB will evaluate the potential negative impacts (if any) of all AB 32 regulations in these communities prior to their adoption with safeguards.
•    CARB will design the market mechanism compliance protocols to achieve maximum emission reduction and co-benefits in vulnerable communities by including incentives and restrictions.
•    CARB will initiate a public process within three months to determine and recommend the percentage of resources generated through AB 32-related auction and fee revenues that can be directed to assist in adaptation and emission reduction measures for the most vulnerable communities and small businesses.

CCA’s concept is officially supported by the Latino Issues Forum, Oxfam America and the American Lung Association. It was developed by Dr. Shankar Prasad and Tim Carmichael, with the input of several interested parties. If you would like to read the full concept paper, please visit the Reports section of

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