Heat’s on cap and trade

There’s a persistent myth out there that left-wing loonies are somehow trying to foist carbon cap-and-trade schemes on California business.

In fact, lots of progressives and environmental groups aren’t all that crazy about cap and trade either—and believe that it’s a complicated game which lets polluters off the hook for their impacts on local communities.

In fact, the state’s ambitious anti-global-warming law, Assembly Bill 32, is now stumbling in the courts, because several environmental-justice organizations sued over the controversial cap and trade plan that state regulators approved in December.

A.B. 32, formally called the Global Warming Solutions Act of 2006, has lots of moving parts. The cap-and-trade rules, which the California Air Resources Board wants to begin implementing next year, are just one piece of the overall plan. But a San Francisco Superior Court judge last week issued a tentative ruling that CARB must consider alternatives to cap and trade when regulating major polluters like oil refineries, power plants and big manufacturers.

“The judge is not OK with his single-minded march toward cap and trade,” said Alegria De La Cruz, an attorney with the Center on Race, Poverty & the Environment, one of the main plaintiffs in the lawsuit, told Bites.

Several environmental-justice groups are critical of cap and trade because they feel that it allows polluters to buy their way out of the problem, rather than clean up their polluting facilities in low-income neighborhoods. After all, it’s not just carbon dioxide coming out of those smokestacks.

“For trading schemes like these, there’s a lot of evidence of real failures to protect local communities,” De La Cruz added. “Certain communities get treated as dumping grounds. They are poor and they aren’t going to fight back.”

Under the current cap-and-trade scheme, starting in 2012, each of the 600 facilities that fall under the cap-and-trade regime would be given a certain number of carbon allowances.

Any facility that pollutes more than its cap would have to buy additional allowances from other businesses that aren’t using all of theirs. And each year, the state is supposed to lower the cap on businesses in that particular industry—raising the incentive to cut carbon emissions.

But the court found that CARB should have given closer scrutiny to alternatives like “cap and fee,” a more straightforward system (one would hope) in which polluters would simply be fined for exceeding their greenhouse-gas limits.

Another alternative would be direct regulation and tough enforcement mechanisms that simply forbid pollution beyond a set level.

CARB has also been criticized for deciding to give away carbon allowances to polluters, rather than auctioning them off. That wasn’t part of this lawsuit, but perhaps it will get another look.

Then again, many observers say this tentative ruling by the S.F. Superior Court is just a hiccup. It’s likely to be appealed, and there’s also a good possibility that CARB could satisfy the judge by releasing more analysis of the alternatives.

De La Cruz clarifies that her group, and other environmental-justice organizations that joined in the suit, are strongly in support of A.B. 32.

“A number of the petitioners in this case were walking precincts against [Proposition] 23,” the oil-industry-backed initiative that would have suspended the state’s greenhouse-gas laws, but was defeated by voters last November.

“We need A.B. 32. We just need it to be done right.”