ND1024112

Title: California Adopts Nation?s First Cap-and-Trade Program

Description: The California Air Resources Board unanimously approved greenhouse gas regulations that seek to reduce pollution and address climate change.

Page Content: LOS ANGELES ? The California Air Resources Board on Thursday unanimously adopted the nation's first state-administered cap-and-trade regulations, designed to put in place air pollution controls that seek to reduce greenhouse gas emissions.

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The Los Angeles Times reported last week that the ?complex market system for the first time puts a price on heat-trapping pollution by allowing California's dirtiest industries to trade carbon credits.?

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Prior to making its decision, the Times wrote that the air board heard ?scathing comments? from union workers fearful of losing their jobs and ?a parade of industry representatives? who said that the regulations are anti-business. However, those comments were not enough; the eight-member board approved the measure with ?scattered applause,? and Chairman Mary Nichols said, "We've done something important,? adding, "Cap-and-trade is a new tool that for the first time allows us to reward companies for doing the right thing.?

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Cap-and-trade is the centerpiece of California's climate change law that mandates a reduction in carbon pollution to 1990 levels by 2020. Beginning in 2013 the state's largest carbon emitters will be required to meet the caps or buy credits if they cannot. Phase 2 of compliance starts in 2015 and could include 85% of California's emissions sources.

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Former Gov. Arnold Schwarzenegger released a statement noting that the vote last week was ?closely watched by other states and, if the program is deemed successful, it will likely serve as a model for future markets. The U.S. Congress has rejected a similar national program.?

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At the NACS Show Closing General Session earlier this month, Tom Robinson, president of Robinson Oil Co. (Santa Clara, Calif.), took the gavel as the new NACS chairman. During his speech he commented how California has gone from an innovative fuel marketing state to a legislative and regulatory haven.

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Gary Gero, president of the L.A.-based Climate Action Reserve, echoed this sentiment, noting that if California ?gets it right? on cap-and-trade, other states will be looking to follow suit.

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�"People watch what California does and do emulate it,? Gero told the newspaper, adding, ?Future cap-and-trade programs are going to pick up a lot of the design features we are implementing here. You'll see regional programs develop. They will put pressure on the federal government. It will send out ripples around the country."

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Content Subject: Government Relations

Formatted Article Date: October 24, 2011

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