The state of California exercised its option to pursue far-reaching climate protection legislation within its borders, seeking to reduce carbon emissions significantly. Legislators were very confident that they would not be acting alone, and that other jurisdictions, if not the federal government would soon act in similar fashion. However, it has proven not to be the case and California remains alone when it comes to the implementation of stringent carbon trading scheme. In CA, AB32 legislation is now likely to be fraught with consequences as implementation approaches.
When it was proposed in CA, AB32 was indeed groundbreaking. Back in 2006, the state noted as part of the bill’s declarations that this action would encourage “other states, the federal government and other countries to act.” AB32 would only really be effective if other jurisdictions took action as well, principally because restricting carbon emissions only works if a comprehensive approach is made on a nationwide basis. Otherwise, “emissions leakage” could take place when neighboring locations are regulation free.
The federal government has been painfully slow to push contentious climate bills through and whereas a nationwide carbon emissions trading scheme was engaged when the House of Representatives passed their own bill, it now looks as if it will be significantly watered down before the Senate will pass its own climate care bill.
When the Kyoto Protocol was discussed, attending nations agreed that greenhouse gas emissions could not be managed adequately unless every jurisdiction had some kind of regulation in place. However, the emissions trading scheme in the European Union remains the only significant effort so far.
Kyoto proposed that carbon emissions be reduced by 80% through 2050. These are lofty goals and can only be met through unified regulatory programs. If the U.S. Senate does not pass a cap and trade trading scheme, should California continue to go it alone with CA AB32? Some advocate that there could be significant risks to the state economy, under the current stipulations.
It is possible that CA AB32 will cause organizations in the state to move out and set up locations elsewhere. This would only result in emissions sources elsewhere exceeding those reductions made in California and organizations that remain in State could find themselves at a real competitive disadvantage.
Although there has been opposition in CA, AB32 is most certain to go ahead, but many are calling for a relaxation for some of the more limiting options, allowing flexibility to come into the timing of emissions reductions, which had been set through the year 2020.
No matter where in the country an organization resides, it should pay particular attention to what happens with CA AB32. This law is an indication of how carbon emissions and energy efficiency will eventually be regulated everywhere. Internal inefficiencies and meaningful monitoring and reporting systems must be investigated by company chiefs sooner rather than later.
Daniel Stouffer has a lot of information about the CA AB32 and why a visit to www.verisae.com can be of use to you.
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