EPA Could Limit California’s Unique Role in Shaping Air Pollution Rules

Air pollutionThe Trump administration is on the brink of what could prove its most consequential legal battle with the state of California, with EPA chief Scott Pruitt expected this week to take aim at the autonomy that state leaders were given in the 1970 Clean Air Act to establish pollution standards for vehicles that are more far-reaching than the federal government’s. This autonomy is widely credited with the Golden State’s emergence as a world leader in environmental regulation.

Last week saw confirmation of months of White House and EPA leaks that President Donald Trump would throw out a 2012 Obama administration edict that required average miles per gallon to nearly double to 54.5 for automakers’ fleets of new cars and trucks by 2025. Trump’s skepticism about climate change made him particularly open to the argument from General Motors, Ford and Chrysler that out-of-touch regulators under the previous president were trying to force them to sell vehicles that U.S. consumers didn’t want to buy.

But as The New York Times reported over the weekend, Trump and Pruitt went further than automakers wanted both by rolling back mileage standards more than expected and by signalling their readiness for a court fight over the deference that federal regulators have traditionally shown to the California Air Resources Board.

The Golden State’s problems with smog in the Los Angeles Basin – visible in the 1973 EPA photo shown above – led to the first state law in the U.S. targeting air pollution being adopted in 1947, among many other precedent-setting regulations. The air board continued California’s role as a pioneer in setting vehicle emission standards after it was launched in 1968 under then-Gov. Ronald Reagan. Its vehicle emission and safety rules often end up being copied by Congress and federal regulators and by nations around the world. The state’s present rules are followed by 12 other states, including New York and Pennsylvania – meaning the Golden State dictates what automakers must provide in about one-third of all new cars sold in the U.S. each year.

California’s special status may be only state carve-out in federal law

But with California’s pollution problems beginning to look more like the rest of the nation’s in recent decades, Republicans have increasingly chafed at the idea that CARB and not the EPA should have the dominant policy-making role on vehicle fuel and emissions standards.

An analysis in The Atlantic laid out how unusual the state’s status is:

“California is written into the Clean Air Act by name: At any time, it can ask the EPA administrator for a waiver to restrict tailpipe pollution more stringently than the federal government. If its proposed rules are ‘at least as protective of public health and welfare’ as the EPA’s, then the administrator must grant the waiver.

“This power is reserved alone for California, and it only covers pollution from cars. No other state can ask for a waiver. (In all of federal law, this might be the only time that a specific state is given special authority under such a major statute.)”

The administration of President George W. Bush became the first to challenge California’s special status when it rejected the state’s request to expand its definition of what substances in the atmosphere it could regulate to include non-polluting greenhouse gases. That prompted the filing of a lawsuit in January 2008 by then-Attorney General Jerry Brown that was backed by Gov. Arnold Schwarzenegger. But it became moot after Barack Obama succeeded Bush in the White House and the EPA resumed treating California’s proposals with deference.

Over the past 14 months, California Attorney General Xavier Becerra has filed 28 lawsuits against the Trump administration, according to a tally kept by the Washington Post. But even before Becerra began his litigation, Gov. Brown anticipated the upcoming CARB-EPA fight and emphasized its importance. In comments made in December 2016 – a month after Trump’s election – Brown framed the dispute as having consequences for the “survivability of our world” because of the threat posed by global warming.

At an American Geophysical Union conference in San Francisco, according to a Sacramento Bee account, the governor said, “We’ve got the scientists, we’ve got the lawyers and we’re ready to fight. We’re ready to defend. …. And, if Trump turns off the satellites, California will launch its own damn satellite. We’re going to collect that data.”

This article was originally published by CalWatchdog.com

Cap and trade is looking more and more like a tax

The veneer that keeps everybody from seeing that the cap-and-trade program is really just a tax is coming unglued.

Last weekend, Mayor Eric Garcetti blasted out an email newsletter happily announcing that the Jordan Downs public housing development in Watts will be refurbished with money from the hidden tax you’re paying for gasoline and electricity.

Photo courtesy of Eric Garcetti, Flickr.

Photo courtesy of Eric Garcetti, Flickr.

Watts will receive a $35 million grant of cap-and-trade funds, which Garcetti said will help make “dreams come true” with “improved quality of life, a renewed focus on public health, and better access to affordable housing.”

The city said the work on Jordan Downs will include rebuilding “distressed” units, creating recreational programs, and opening “about 165,000 square feet for retail.”

The funds will also pay for solar panels, a food waste prevention program, and 10 electric buses.

The cap-and-trade money comes from the state’s Greenhouse Gas Reduction Fund, which takes in revenue from the sale of allowances to emit greenhouse gases. The allowances, sold at state auctions, are purchased by companies that generate electricity, refine petroleum, make cement and process food. The prices of those things in California now include the cost of buying these permits to emit greenhouse gases.

Other states don’t do this, but in 2006, to save the planet from global warming, California passed a law to require a reduction in greenhouse gas emissions. Under the mandate now set in current law, greenhouse gas emissions statewide must be 40 percent below 1990 levels by 2030.

To achieve this goal, the California Air Resources Board developed the cap-and-trade program. It puts a statewide limit on GHG emissions, and businesses that are under the law are required to have a permit for each ton of GHG emitted. Every year fewer permits are issued, and the minimum price is a little higher.

The money that’s paid to the state for these permits looks a lot like a tax. But a state appeals court ruled that it’s not a tax, because it’s not compulsory. Any business that doesn’t want to pay it, the court reasoned, could simply go out of business.

Now you know why other states don’t do this.

For California politicians, the cap-and-trade funds are like a gift from heaven. Gov. Jerry Brown is spending them on the bullet train, which is barred by law from being funded with a tax increase. And the Legislature can hand out the rest of the loot to local governments and organizations seeking funding for pet projects.

To help spend the money, lawmakers created a committee called the California Strategic Growth Council and tasked it with advancing the revitalization of local communities. The SGC oversees the Transformative Climate Communities program, which considers grant applications from community groups, like the Watts Rising Collaborative, an advocacy organization made up largely of departments of the city government.

So your city tax dollars are being spent to lobby for cap-and-trade funds that come from the extra money you’re paying for electricity, gasoline and anything that’s made or moved in California.

Some of the $35 million grant for Watts will be spent to connect residents with new jobs created by TCC projects, and in a hint of how the spending will work out in practice, the funds will also be used for a “displacement avoidance plan” which will provide resources to “educate residents about their housing rights.” In other words, gentrification.

But nobody’s admitting that. It’s all under the banner of fighting climate change.

The president and CEO of the Housing Authority of the city of Los Angeles, Douglas Guthrie, said the Housing Authority is “proud to be leading this transformational initiative to build a healthier Watts” with “greenhouse gas reduction strategies.”

It’s just a tax. All of California accounts for only 1 percent of worldwide greenhouse gas emissions, so cutting emissions to 40 percent below 1990 levels is an exercise in futility, if what you’re really worried about is climate change.

Politicians are not really worried about climate change.

The cap-and-trade program is turning into a tax for community redevelopment and for a plain old slush fund. It doesn’t help Earth’s climate, but it does real damage to California’s business climate. Cap-and-trade is a hidden tax on energy that is making everything in California more expensive than in other states.

The biggest challenge for regulators is to prevent the prices of the allowances from going up too sharply. It might bring the game to a crashing end if people noticed the economic damage they’re enduring. When the voters put two and two together, things can heat up fast.

Susan Shelley is an editorial writer and columnist for the Southern California News Group. Reach her at Susan@SusanShelley.com and follow her on Twitter: @Susan_Shelley.

This article was originally published by the Orange County Register

California’s cap-and-trade faces tough questions

As reported by the Sacramento Bee:

California’s marquee climate-change program faced tough scrutiny on Tuesday from a state appeals court judge who seemed skeptical that the $4.4 billion raised from the state’s cap-and-trade program complied with laws regulating taxes and fees.

“Where does this end?” Associate Justice Harry Hull asked state lawyers at a hearing in a long-running lawsuit that challenges the state’s ability to collect revenue from the cap-and-trade auctions it has sponsored since 2012.

Despite Hull’s questioning, two of three justices at the 3rd District Court of Appeal appeared to be leaning toward upholding the California Air Resources Board’s greenhouse gas cap-and-trade program. It aims to gradually reduce greenhouse-gas emissions over time by compelling industries to change the way they do business under the authority of the landmark 2006 law, Assembly Bill 32.

A decision from the court is expected within 90 days, but the losing side likely will appeal the case to the state Supreme Court.

Hold Climate Change Policy-Makers Accountable for Economic Consequences

Global WarmingIn reaction to the election of Donald Trump, California’s governor, state Legislature and Air Resources Board have made clear their intention to double down on our state’s already strictest-in-the-nation climate change policies.

Making such claims is easy when ignoring the current cost burden of the state’s climate policies on consumers and businesses, and how much more the costs will skyrocket under increasingly high greenhouse gas reduction targets.

Unelected bureaucrats at the California Air Resources Board have resisted any legitimate attempt at conducting a comprehensive economic analysis of AB 32, the state’s landmark 1996 global warming law– either during the rulemaking process or once the regulations took effect. CARB is attempting more of the same with the newly established 2030 40 percent emissions reduction target.

The significant consequences of this one-sided approach are being ignored as part of the policy and regulation development process. These rules will have real-life cost impacts on every major industry in California and every resident, who will see higher prices for food, electricity, gasoline, housing and just about all the necessities of life.

Higher costs, in addition to increasing consumer prices across the board, make California businesses less competitive with out-of-state companies. These have already resulted in a sharp decline in jobs, notably well-paying blue-collar jobs in the manufacturing, oil and gas and construction sectors, and a concurrent loss of tax revenues that support education, public safety, and social service programs.

It doesn’t have to be this way.  Sacramento lawmakers should demand that state agencies like CARB conduct objective economic analyses in order to craft balanced climate change regulations that will not exponentially increase costs on California’s businesses and families — especially those in lower income communities, which pay a larger share of their income in energy and transportation costs. Any increases created by new regulations will disproportionately impact those families who can least afford it.

Independent studies and subject matter experts have waved a warning flag about the economic impact and its burden on families and businesses. A recent study has shown that our climate change agenda will increase costs by $3,000 per year for every family in California. The Director of Stanford University’s Precourt Energy Efficiency Center has cautioned that achieving the new 2030 goal would likely entail “large economic costs,” and lead to a “less diversified and more fragile state economy.”

CARB has initially estimated that its new regulations could cost 100,000 jobs and result in the loss of up to $14 billion in gross economic output, which the agency brushes off as relatively immaterial in the context of the state’s overall economy.

Among regulatory initiatives being considered in CARB’s recently updated AB 32 Scoping Plan are: forcing higher density of commercial and residential developments; developing “pricing mechanisms” such as road user/vehicle miles traveled-based pricing, congestion prices and parking pricing strategies; creating expensive multiple “incentives” to make electric vehicles artificially more affordable than conventional vehicles and imposing arbitrary and unrealistic quotas for market penetration; and forcing decreases in the use of affordable, widely available fossil natural gas. These and other proposed mandates will significantly increase the cost and availability of housing, electricity, gasoline and diesel fuel and the cost of manufacturing and transporting goods produced in California with a chilling effect on jobs and revenues.

California can do better. Sacramento legislators have an opportunity to provide essential oversight over a regulatory body to ensure their constituents and the businesses they represent are not unduly burdened. It’s important to note that because California generates less than one percent of worldwide greenhouse gas emissions, which know no boundaries, the hardships our state’s climate policies impose on its people and economy have little more than symbolic value.  This is why CARB must conduct a comprehensive economic analysis now, to weigh how aggressively we should get ahead of other states or nations with regard to climate policies.

Executive Director of the Industrial Association of Contra Costa County

This piece was originally published by Fox and Hounds Daily

Top 10 Stupidest New Laws in California for 2017

california-flagI’m not in the habit of complaining at the outset of a column, but I’ve taken on a nearly impossible task — figuring out which, of the hundreds of new California laws about to go into effect, are the stupidest.

Don’t laugh. I’m serious.

It’s really, really hard to keep the list at 10 with hundreds of hare-brained schemes that became real laws.

After all, for far too long, the California Legislature has been a “conservative-free zone” — even though there were a handful of “Republicans” occupying seats and taking up space.

I’m going to list the new laws in order of their egregiousness to me, but I’m open to additions or wholesale re-ordering if you care to comment.

Given that Californians are facing 898 new laws going into effect on January 1st, 2017, there’s plenty to hate.

  1. Prop. 63: “2nd Amendment Nullification” Act.  Although various portions go into effect in various years — yes, they staggered implementation of this “critically needed reform,” some out to 2019 — this is the most sweeping assault on our long-cherished, God-given natural right as Americans to protect our lives and our freedom.  It requires you to pass a background check and pay for a permit to buy ammunition for the gun you may have just passed a background check to buy.  Yeah, that’ll stop criminals — who buy their guns and ammo in parking lots from other criminals. WooHoo! Next, it makes high-capacity magazine (any magazine that holds more than 10 rounds) illegal to possess — even if you bought it prior to the current ban and ownership was previously considered grandfathered.  This law should make it clear that the goal of the left is not “safety” — it’s control.
  2. SB880: “Bullet Button Ban.” For years, California Democrats have sought to ban a made-up classification of semi-auto rifles with “evil features” that they re-named “assault weapons” for propaganda purposes. Every year, California Democrats attempt to increase control over this “hated group” of guns — until they finally outright ban all semi-automatics.  This law will not do a single thing to further public safety, as the San Bernardino terrorist attack illustrated — determined mass murderers will simply ignore and work around all gun control laws — as if they are just words on paper. One last bit of irony: in a previous legislative session, this same bill was sponsored by none other than disgraced State Senator Leland Yee. If that name sounds familiar, you’re right. Leland Yee wanted to “protect” Californians from “assault weapons” on our streets — that is, until he was arrested for trafficking fully automatic weapons and rocket-propelled grenades in exchange for campaign contributions. He’s currently serving a five-year prison sentence.
  3. SB3: Minimum Wage Hike to $15/hour by 2020. As a result of a strong socialist push by unions and complicit governments — such as the union-controlled California legislature — businesses are looking to eliminate as many jobs as possible, investing in automation instead. When you combine this with unchecked illegal immigration — where you have an unlimited labor pool willing to work for sub-par wages under the table — the future for entry-level jobs and small business owners in California is bleak.
  4. AB1785 The “Hands Free” Law. This is another example of government gone wild. AB1785 prescribes driver behavior so severely that in and of itself, I believe it will cause more accidents — and more deaths. Not only must the phone be dash mounted — meaning you’ll have a permanent distraction right in front of you — but you may not text, take photos or video, or enter GPS destinations while driving. Fat chance of stopping those activities with a mere $20 fine. The bill does stipulate that “the only time a driver is allowed to touch the device is when he or she is activating or deactivating a “feature or function.” However, that process should only involve a “single swipe or tap of the driver’s finger,” according to the bill,” mynewsla.com reports. How about “hands off” my phone instead of an unenforceable “hands free” law?
  5. AB 1732: Single-User Restrooms. If you’ve ever had to go so badly that you used the opposite sex restroom at a gas station or Starbucks, then perhaps you think this law is needed. But do we really need another law regulating bathrooms? Some businesses have already put signs on their single-use restrooms designating use by either sex. And sometimes people just take it upon themselves. I can’t help but think this law is unnecessary and diminishes us as a society a little.
  6. SB 1383: Controlling Cow Flatulence. Not making this up. In spite of the fact that 53 California dairy farmers went bankrupt, moved out of state, or just closed down this year, the Marxist-Progressives are back at it again. Capture cow farts or suffer heavy fines.  CARB (CA Air Resources Board) suggests inserting a tube into the cow’s digestive system and venting into a backpack. Even liberals admit that laws like this, where government tries to control the uncontrollable, can have undesirable economic consequences. Lost jobs, lost industries, lost revenue. Stupid law.
  7. AB 857: Ghost Gun Ban.  Even if you manufacture your own gun — starting with an 80 percent receiver — that requires you to have special skills and tools to complete the machining, you must now register it and obtain a serial number from the California Department of Justice. The purpose of this law is simply to record your name and your firearm on a list for eventual confiscation. Once again, control — not public safety — is the goal.
  8. SB1322: Legalizing Child Prostitution. This law bars law enforcement from arresting sex workers who are under the age of 18 for soliciting or engaging in prostitution, or loitering with intent to do so. So teenage girls (and boys) in California will soon be free to have sex in exchange for money without fear of arrest or prosecution. Now that is nuts. I understand the idea of trying to not punish the victim, but certainly granting judges discretion is better than legalizing and therefor “green-lighting” behavior that is so harmful to the individual child.
  9. Prop. 57:  Early Release for so-called Non-Violent Criminals. This was Governor Jerry Brown’s baby — the crown jewel of his prison reform initiatives. Among those offenses he considers “non-violent”: rape of an unconscious person; human trafficking involving sex acts with minors; and assault with a deadly weapon. Blogger Felicia Wilson summed it up well (original emphasis): “Call me crazy, but shouldn’t a crime that includes the word rape or assault be considered, I don’t know … violent?”
  10. AB 2466: Felons Voting. Low-Level felons serving sentences outside of state prison get to keep their right to vote. Hmm. Wonder which party this could possibly help? Just like the “illegal alien vote,” Democrats will have the felon vote locked down. This is simply about protecting their power and making it permanent.

When California Democrats promised to take to the streets to defend the rights of convicted felons, illegal aliens and welfare recipients, they weren’t kidding. If only they were as serious about cracking down on immigration cheats and violent criminals as they are about penalizing law-abiding citizens and gun owners, California would have more jobs, less crime — and might be a place people want to come to instead of fleeing.

Tim Donnelly is a Former California State Assemblyman. FaceBook: https://www.facebook.com/tim.donnelly.12/ Twitter: @PatriotNotPol 

This piece was originally published by Breitbart.com/California

Carbon tax program sputters again

As reported by the Sacramento Bee:

When California launched its cap-and-trade program four years ago, the unspoken fear was that the price of carbon emissions credits would soar out of sight and bankrupt manufacturers and other industries forced to buy them.

Now cap and trade, a crucial piece in California’s war on climate change, finds itself with exactly the opposite problem: an excess of credits and insufficient demand. The result is a program that’s stumbling badly and facing an increasingly hazy future in the Legislature.

The cap-and-trade market had another bad day Tuesday, with hundreds of millions of dollars worth of unsold carbon credits left over following the latest state-run auction. Only about 30.8 million credits were sold, each one representing a ton of carbon emissions, out of approximately 96 million credits that went on sale. The auction was held last week, but results weren’t released until Tuesday by the California Air Resources Board.

It was the second straight quarterly auction in which scores of carbon credits failed to attract buyers, although there was higher demand this time around. Last spring’s auction ended with roughly 90 percent of the credits unsold. …

Click here to read the full story

Let’s Pump the Brakes on Cap-and-Trade

cap-and-trade-mindscanner-sstockIn 2006, elected officials gave the California Air Resources Board virtually unchecked authority to implement AB32, which aims to reduce carbon emissions to 1990 levels by the year 2020. The legislation, including the controversial cap-and-trade program, expires in four years.

Some lawmakers have already introduced legislation, such as SB32, to extend CARB’s authority. However, instead of rushing to renew this controversial and expensive program, we should slow down and come up with a more affordable solution that benefits all of California.

Cap-and-trade limits carbon emissions by energy producers and raises money through the sale of carbon credits. It’s supposed to fight global warming by making it more expensive to use carbon-based fuels. But that’s not the only thing it does.

It turns out the program has made life more expensive for Californians as well.

Since being given the authority, CARB has implemented a steady stream of costly regulations, such as the “hidden gas tax.” Experts agree that this hidden tax costs California drivers at least 10 cents more in added cost per gallon of gasoline. They also acknowledge CARB’s “low-carbon fuel standard” could add another 13 cents per gallon by 2020.

Motorists might be open to paying these costs if the money actually went towards repairing our crumbling roads. Instead it seems the cap-and-trade program has become a multi-billion dollar slush fund for politicians’ pet projects.

Perhaps intentionally, CARB still hasn’t come up with a systematic way to determine if cap-and-trade dollars are really doing anything to help lower emissions levels.

There is little consensus on what constitutes a “green project.” When pushed for answers, CARB officials deflect. This obscurity allows the governor to direct cap-and-trade funds towards his $71 billion high-speed rail project, which is actually increasing the state’s carbon emissions.

Some cap-and-trade funds were supposed to go towards programs for low-income communities that want to invest in renewable energy. Because CARB is largely free to do as it wishes, there’s no real way of knowing if these grants are reaching their intended targets. That’s a kick in a gut to the less fortunate who supported AB32.

Like you, I want breathable air and clean parks for our children and grandchildren. But do CARB’s unelected bureaucrats really need this much power? Government mandates can be very expensive and inevitably the costs are passed down to consumers. Not everyone can afford a Tesla.

Why can’t we use cap-and-trade funds to solve real problems like emission-causing traffic congestion? Think about it: What pollutes more, a car that reaches its destination quickly or one that’s stuck idling on a freeway for an extra 20 minutes?

A state appeals court has already put the future of cap-and-trade in doubt. And many questions remain, such as how to spend the billions collected and whether or not the program is really an illegal tax. Some doubt CARB has the right to collect the money at all.

There’s also a fierce debate over whether or not regulators can extend the program without the Legislature’s permission. The Legislature’s chief counsel doesn’t think so.

California is already a leader on climate change, and our current law doesn’t expire until 2020. Perhaps we should leave lawmaking to our elected officials, not abdicate power to unelected regulators. Rather than rush an extension, let’s invite the public to join the discussion. Californians deserve clean air, but they also deserve affordable energy—and to know how their dollars are being spent.

George Runner is an elected member of the California State Board of Equalization.

Controversial Carbon Tax Faces Strong Opposition

carbon-tax-1Despite years of success in doing what it was supposed to do — cut emission levels — California’s controversial cap-and-trade system has run up against opposition that could be strong enough to sink it. But with nothing to lose and everything to gain, Gov. Jerry Brown has shifted into political overdrive to save it instead.

Big plans

Through the California Air Resources Board, Brown’s administration has tried to restore confidence among big California businesses that the state’s carbon-trading regime is here to stay. Amendments to the cap-and-trade rules proposed by CARB “envision a carbon market through 2050 with increasing allowance prices,” according to Scientific American. But legal uncertainty has clouded CARB’s ability to promulgate such regulations beyond the year 2020, “thanks to a combination of potentially limiting language in the original climate law, AB32, and a lawsuit challenging the legality of cap-and-trade auctions under a law requiring a two-thirds legislative majority to approve taxes,” the magazine added.

“The amendments released [last month] would establish decreasing emissions caps for covered entities through 2031, to reach 40 percent below 1990 levels, and would include preliminary caps through 2050 ‘to signal the long-term trajectory of the program to inform investment decisions.’ Other proposed amendments would provide for compliance with U.S. EPA’s Clean Power Plan for existing power plants, allocate allowances to businesses in order to prevent emissions from escaping state borders, and streamline how emitters register and participate in auctions.”

Backrooms to ballots

Despite broad support for an extended cap-and-trade system among influential Democrats, whose grip on Sacramento is virtually unchallenged, California’s legislative counsel has sided against CARB on the extension plan. “Meanwhile, a lawsuit from the California Chamber of Commerce charges that the permit fees are a tax and should have required a two-thirds vote in the Legislature to take effect,” as the San Francisco Chronicle reported. “Although the suit has dragged on for nearly four years, questions raised by an appeals court judge in April suggested that he might side with the chamber.”

The ordeal has presented Gov. Jerry Brown with a potentially devastating threat to one of his keystone policies. Although the governor “has been trying to muster support from at least two-thirds of the Legislature, in case the Chamber of Commerce wins its suit, […] convincing Republicans and business-friendly Democrats hasn’t been easy,” the paper added. “And the current legislative session ends Aug. 31.” Beyond the obvious challenge of securing Republican support, Brown must contend with members of his own party, who have split awkwardly on cap-and-trade since before its inception.

“When the law enabling cap and trade was being argued over, the whole progressive left-of-the-left were pretty suspicious of carbon trading,” as Stanford Law energy expert Michael Wara told Wired. “So the law’s authors offered a compromise: the state Legislature would re-evaluate cap and trade in 2020,” the magazine noted. “It didn’t seem like a big gamble at the time.” But Brown’s determination to use revenues from the program to fund his cherished high-speed rail project — according to environmentalists, not the greenest expenditure to choose from — added another political wrinkle.

Now, the prospect of a drawn-out loss in the Legislature has raised speculation that Brown will respond, in a manner somewhat reminiscent of former Gov. Arnold Schwarzenegger, by taking his plans directly to the voters. Preparing for a showdown, Brown has launched — perhaps for the last time as governor — back into campaign mode. “Mr. Brown last week created a PAC, Californians for a Clean Environment, signaling he may turn to voters for support to extend cap and trade and the state’s emissions-reduction goals through a ballot initiative,” the Wall Street Journal recalled. “The program is particularly important to Mr. Brown, as profits help fund the state’s planned bullet train, among other goals by the state’s Democrats.”

Within the Brown camp, however, the official line has remained more optimistic than the ballot preparations might suggest. “There is no state or nation in the Western Hemisphere doing more to curb carbon pollution and our dangerous addiction to oil than California,” said Brown’s executive secretary, Nancy McFadden, in a statement noted by the Journal. “The governor will continue working with the legislature to get this done this year, next year or on the ballot in 2018.”

This piece was originally published by CalWatchdog.com

CA Cap-and-Trade Credits Extend to Brazil

carbon-tax-1In late 2012, as officials with the California Air Resources Board were refining rules for the state’s nascent cap-and-trade pollution rights program, a huge scandal was unfolding in the European Union. Five Deutsche Bank AG officials were arrested for their role in a complex scam involving using the sale of carbon-emission certificates to avoid paying taxes. Earlier that year, six cap-and-traders involved with the bank had been arrested as well.

Cap-and-trade critics had always warned that as soon as programs were introduced, there would be aggressive efforts to game and/or cheat the rules to make money. With these warnings reinforced by the EU scandal, California officials in early 2013 said they’d learned their lesson. Greenbiz.com reported that …

California, with the advantage of advanced warning, has taken the EU market’s lessons to heart. It has recognized the crucial need to tightly control — and extensively oversee — who can participate in the carbon market and how. With the help of the state Attorney General’s office, California has adopted more stringent rules than the EU ETS [Emissions Trading Scheme].

State tax credits for payments to indigenous communities?

Now, however, the Brown administration is pondering relaxing these rules by allowing companies to get pollution credits by paying for preservation of forest lands in Brazil.

The idea has been discussed for years but has picked up momentum of late. According to recent reports, state regulators are closer than ever to formally expanding the cap-and-trade program by allowing polluting industries to offset their carbon emissions by paying indigenous communities in the Amazon to preserve the rain forests in their region.

This idea has won praise from environmental groups, who have long depicted preservation of the rain forests in the Amazon delta as a global priority. They call it a great way for Brown to burnish his environmental legacy.

The Western States Petroleum Association has also been supportive, saying industries need options to meet their commitments under AB32 and related laws.

Brazil’s huge corruption scandal bodes poorly for CA program

But the initial coverage of Brown’s trial balloon omitted mention of two key issues: Gaming and cheating of cap-and-trade programs remains a huge problem around the world, and Brazil has both a long history of corruption and a lack of transparency.

In early 2015, Foreign Policy magazine reported how the European Union’s program had become a “playground for gangsters, international crime syndicates, and even two-bit crooks — who stole hundreds of millions of dollars in pollution credits.”

In October, Forbes magazine reported on a slew of new scandals, starting with schemers in Russia and Ukraine being accused of using the EU cap-and-trade market to sells counterfeit credits for 600 million tons worth of carbon dioxide emissions. The account noted that the less sophisticated a nation’s law-enforcement system, the more likely cap-and-trade scams were to be — and that some of the world’s richest people and companies were taking advantage.

“The cap-and-trade system of emissions trading is very difficult to control and its effects are diluted. … It is precisely because I am a market practitioner that I know the flaws in the system,” Forbes quoted financier-investor George Soros as saying.

Meanwhile, in January, Transparency International reported that over the previous year, Brazil’s corruption problems were growing worse at a faster rate than in any nation on the planet. Agence France Presse reported last week that a scandal involving billions of dollars of missing revenue from state oil giant Petrobras continued to grow, with dozens of government and business leaders implicated.

Efforts to remove President Dilma Rousseff from office have been complicated by the fact it is hard to find many credible critics of Rousseff within the Brazilian government, given how many prominent Brazilian politicians are either directly tied to the scandal or indirectly tied through close political alliances.

According to CalMatters, state air board officials said they would look to avoid problems caused by Western nations’ cap-and-trade programs in another tropical nation: Nigeria. But the issues there involved indigenous communities being denied use of forest lands they relied on because of restrictions under new conservation agreements — not necessarily the problems that California could risk if it counts on Brazil as a partner in a cap-and-trade pact.

This piece was originally published by CalWatchdog.com

CARB’s Ironic Quest to Save the Rainforest

RainforestThe California Air Resources Board recently announced plans to dedicate a portion of its hidden gas tax to saving the tropical rainforest. This is ironic because CARB’s own policies actually contribute to rainforest deforestation.

The agency is a strong advocate of a “low carbon fuel standard,” or LCFS. The LCFS is a food-for-fuel program that, along with similar mandates in the European Union and the United Kingdom, is wreaking havoc in the rainforest.

Unlike the national ethanol mandate, which relies heavily on domestically-produced corn-based ethanol, CARB’s LCFS places a much greater emphasis on sugar and soybean-based fuels – crops often produced in tropical nations where rainforests are endangered.

When CARB initially considered adoption of the LCFS in 2008, 27 scientists and researchers submitted a letter indicating the policy could have serious unintended consequences on land use.

Holly Gibbs, a researcher at Stanford University’s Woods Institute for the Environmentstated: “If we run our cars on biofuels produced in the tropics, chances will be good that we are effectively burning rainforests in our gas tanks.”

Noted primatologist Jane Goodall has also spoken out, stating: “We’re cutting down forests now to grow sugarcane and palm oil for biofuels and our forests are being hacked into by so many interests that it makes them more and more important to save now.”

Just a few days ago CARB collected hundreds of millions in hidden gas taxes in an opaque carbon credit auction. However, instead of raising gas prices to save the rainforest CARB could do much more by reevaluating its LCFS program instead.

Eric Eisenhammer is the founder of the Coalition of Energy Users, a nonprofit grassroots organization for access to affordable energy and quality jobs.

Originally published by Fox and Hounds Daily