Draft Cap and Trade Legislation

The House Energy and Commerce Committee has released draft cap-and-trade legislation. On the key issue of whether allowances will be allocated by the government or auctioned, the draft legislation incorporates a range of possible alternatives, from mostly allocated to all auctioned. Under the latter scenario, 17.5 percent of the auction proceeds would be used to reduce the federal deficit with the rest distributed to consumers, energy efficiency and greenhouse gas reduction measures, and 0.5 percent for "management" -- federal agency management of the program.

-Morgan

Big Picture Facts

The legal literature on climate change tends to focus on particular issues, and only rarely reads the big picture facts that drive the issue.  A recent article in The New Yorker by Elizabeth Kolbert reported these key facts:

"This year, the world is expected to burn through some thirty-one billion barrels of oil, six billion tons of coal, and a hundred trillion cubic feet of natural gas.  The combustion of these fossil fuels will produce, in aggregate, some four hundred quadrillion B.T.U.s of energy.  It will also yield around thirty billion tons of carbon dioxide.  Next year, global consumption of fossil fuels is expected to grow by about two percent, meaning that emissions will rise by more than half a billion tons, and the following year consumption is expected to grow by another two percent.  

"When carbon dioxide is released into the air, about a third ends up, in relatively short order, in the oceans. . . . A quarter is absorbed by terrestrial ecosystems . . . and the rest remains in the atmosphere. . . ." 

-Morgan 

ARB Scoping Plan

The California Air Resources Board has released its draft scoping plan.

Report Documents Current Effects of Global Warming

An interesting report from the University of Maryland's Joint Global Change Research Institute documents the current effects of climate change in the U.S. This report is of interest because (1) it identifies effects that are specific enough that they might be the subject of litigation, and (2) it is authoritative, and therefore will likely be cited as a foundation for an expert opinion. Some of the effects that the report identifies are:

• Increased risk of crop failures


• Reduced productivity of livestock and dairy animals


• Increasing forest fires, insect outbreaks and tree mortality


• Changes in precipitation and drought patterns

Los Angeles GHG Credit Program Announced

GHG credit markets are taking on a local flavor.

At its February 1, 2008 meeting, the South Coast Air Quality Management District governing board approved a workplan for implementing a voluntary GHG emission reduction credit program, known as SoCal Climate Solutions Exchange Program.

An overview of the Program and workplan are available here: www.aqmd.gov/hb/2008/February/08023Aa.html

One likely use of the GHG credits would be in conjunction with the mitigation requirements imposed by CEQA.  Concerns are already being raised about the compatibility of this Program with the cap-and-trade system being developed by the California Air Resources Board.

District staff intend to develop the contours of this Program, including protocols for measuring emission reductions, over the coming months with the goal of presenting the final plan to the District governing board for approval in September 2008.

- Brett

Fees for GHG Emissions

The Bay Area Air Quality Management District has proposed a fee for emissions of GHGs from all facilities with stationary sources in its jurisdiction. The proposed fee has been cited in the press as in essence a carbon tax, but it is not. It is a cost-recovery fee to fund the Air District's GHG programs, principally developing an inventory of GHG emissions. The amount of the fee -- $0.042 per ton of CO2 equivalent -- is so low that it is not likely to have a significant effect on GHG emissions. The largest emitter of CO2 in the Bay Area will, according to the Contra Costa Times, pay less than $200,000 per year. Nevertheless, the fee is significant because it will be the first such fee imposed on CO2 emissions in California. More are sure to come.

-Morgan

CEQA Significance Determinations

CEQA significance determinations have been the focus of much of the early climate change litigation in Calfiornia. The California Air Pollution Control Officers Association has a new white paper on how to determine whether greenhouse gas emissions from a project are significant under CEQA, how to measure GHG emissions, and how to mitigate GHG effects. The white paper is written as a guide for local agencies, but it may also interest project proponents. The white paper is available at http://www.capcoa.org/.

-Morgan