California used to be the fifth largest economy in the world. Today, we have slipped to ninth place. Many say this decline is self-imposed through detrimental tax policy, and even more destructive state regulations.
As such, the Global Warming Solutions Act of 2006 should have been called the “Bring California to its Knees Act of 2006.”
Under the control of Mary Nichols, the California Air Resources Board has been in total control of implementing AB 32, California’s legislation from 2006 addressing the world’s climate change. Nichols and the ARB have made clear to the Legislature that the agency is driving this boat – not lawmakers.
At an Assembly Natural Resources Committee oversight hearing Monday, the ARB had a who’s-in-charge-moment reminiscent of former Secretary of State Alexander Haig. Nichols, when questioned by committee Vice-Chairwoman, Assemblywoman Shannon Grove, R-Bakersfield, as to whether the ARB has the authority to circumvent the Legislature and move ahead on its own with new regulations, and new goal date of 2050.
Nichols told the Assembly members on the committee, “We have the regulatory authority to do it, but would prefer the legislative guidance.”
I’ve received several opinions about whether Nichols and the ARB do or don’t have the authority to circumvent the Legislature. Some say the ARB does not have the authority, but acknowledged that has not stopped the agency in the past with adopting regulations and programs when they felt the Legislature wasn’t moving quickly enough.
Others say if the ARB is only citing AB 32, then they probably do have the authority because AB 32 gave them unprecedented power.
Under AB32, the Global Warming Solutions Act of 2006, CARB was charged with overseeing the lowering of greenhouse gas emissions to 1990 levels by the year 2020. That effectively meant a 25 percent reduction in carbon emissions. According to some climate change experts, we have already reached 1992 levels, which would, under normal circumstances, lead to the scaling back of the program.
But this is the government.
I reported from a hearing last Spring, Air Resources Board Officer Richard Corey admitted, “The last three years have seen the biggest drop in carbon emissions” in the state’s history. He said California has nearly met its 1990 levels of carbon emissions.
But CARB’s AB32 functions are not going gentle into that good night, to paraphrase Irish wit, Dylan Thomas.
Claiming authority AB32 actually did not provide, CARB has expanded its mandate well beyond AB32 and is now also responsible for the Renewable Portfolio Standard, and the Low Carbon Fuel Standard, which has never been authorized in statute.
And of course, the ARB’s cap and trade carbon allowance auction program.
Additionally, in 2011, the California Air Resources Board created a stealthy new corporation in Delaware. The Western Climate Initiative Inc., which will manage the state’s cap-and-trade programs, even has its own form of currency.
Delaware is not subject to California state open meeting or sunshine laws, leaving many questioning why the ARB and WCI opted for such secrecy. The ARB has never provided an answer for this.
The WCI Board of Directors is made up of Matt Rodriquez, the recently appointed secretary for the California Environmental Protection Agency; James Goldstene, CARB chairman and CEO; and the equivalent officials for the Canadian provinces of British Columbia and Quebec. No other American states are involved. And the California Legislature did not authorize the creation of this corporation.
Forest fire carbon emissions — “neutral”
Assemblyman Brian Dahle, R-Bieber, has asked at every hearing with the ARB, why forest fire emissions are not counted in the carbon emissions measured by the state. Again, on Monday, Dahle asked Nichols about this. Nichols squirmed, and gave a non-answer. “Does the ARB measure emissions off of forest fires?” Dahle asked. “No. We call it neutral,” Nichols admitted.
Dahle wasn’t satisfied, because forest fires cause the bulk of the carbon emissions in California, largely wiping out any advances the state may have made through clean air policies.
Dahle again asked Nichols why the ARB is not measuring forest fire emissions, and put it in the equations used for calculating carbon emissions. “There’s controversy in this area,” Nichols said. But she assured Dahle she is committed in working with other agencies on this.
During California’s fire season, one fire can produce more carbon emissions than an entire year of auto emissions. Without forest management, one out-of-control wildfire also renders the soil sterile.
The state’s forests are overgrown and need thinning so the forests can handle fire.
Government’s approach to managing forests actually disrupts natural fire cycles, resulting in overloaded forests and wildfires of greater intensity and severity.
“Overgrown forests have an abundance of woody fuels, allowing flames to burn into the crowns of the tallest trees,” Dahle told me last year after a hearing. “When the forests were managed properly this did not occur.”
In May at a new conference to kick off Wildfire Awareness Week, the Gov. Jerry Brown said he will “do everything I can to deal with forest fires.” But he then discounted his statement when he quipped that the biggest problem is whether people adapt to climate change. “It doesn’t look like the people who are in charge are going to do what it takes to really slow down this climate change, so we’re going to have to adapt, and adapting is going to be very, very expensive,” Brown said.
LAO warnings go unheeded
The Legislative Analyst’s Office has repeatedly warned the ARB “in order to minimize the negative economic impact of cap-and trade, it is important that auction revenues be invested in a way that maximizes greenhouse gas emission reductions for a given level of spending.
Instead of using cost-benefit analyses to gauge the weight and congruity of regulations, the air board continues to deny that their regulations have any economic downside. At the hearing Monday, in her opening statement, Mary Nichols said the ARB regulations “have led to economic growth.”
“The programs we’ve put in place have helped us become a world leader,” Nichols also said later in the hearing.
What was so unnerving was the cult-like following Nichols has in the Legislature. Every Democratic member of the Natural Resources Committee made a special point on Monday of telling Nichols how much they love her work with the ARB.
Heads bobbed in agreement when Nichols said, “Adoption of AB 32 propelled California into a global leadership role of climate change.”
But the rest of the country and world did not follow California’s lead.
2020 and beyond…
Nichols launched into how the ARB is moving beyond the 2020 goals – without legislative authority. “Climate change is real, meaning we need to take long term actions,” Nichols said.
The “longer-term” objectives were not established by the Legislature, but were declared by former Gov. Arnold Schwarzenegger and Gov. Jerry Brown, without legislative direction. It is the Legislature which makes the laws in California.
As such, those longer-term objectives are not binding, and should not be used as the premise for the development of more costly regulations, absent affirmative direction by the Legislature.
All alone with Cap and trade
Cap and trade is the program set up in November 2012 that conducts quarterly auctions of carbon dioxide emissions, with “dirty” companies trading for “clean” credits from “clean” companies.
Specifically, CARB is targeting transportation, electricity, agriculture, industry and commercial and residential sectors for emissions reductions. These sectors “must reduce … greenhouse gas emissions through the direct regulatory measures recommended by the program,” a study by the Legislative Analyst’s Office found.
Numerous studies have shown that California’s cap-and-trade auctions will lead to significantly higher energy costs.
The idea behind the cap-and-trade program is that annual greenhouse gas emissions from certain sectors of the economy will be capped, started in 2013. This cap will be reduced over time, enforced through a carbon allowance purchasing system, managed by CARB.
Cap and Trade is not needed to lower carbon emissions
The Legislative Analyst explained in a 2012 letter to the Legislature that CARB’s cap-and-trade program is not needed to meet AB32′s mandates.
The LAO has also warned the Legislature that cap and trade would greatly increase production costs for businesses forced to comply with CARB’s regulations. But the Legislature has taken no action to curb CARB’s overreaching.