California is pushing ahead with efforts to cut greenhouse gas emissions after voters overwhelmingly rejected a proposition to suspend the state's global warming law.
The 61 percent-to-39 percent vote Tuesday against Proposition 23 re-energized the California Air Resources Board and other agencies charged with implementing the state's climate change agenda.
"It's full speed ahead," Air Resources Board Chairwoman Mary Nichols said in a conference call with reporters on Wednesday.
Requirements to cut pollution apply mainly to companies that use lots of energy – oil refineries, cement manufacturers and utilities, for instance. But consumers could feel the impact of the climate-change law in coming years through higher gasoline costs and utility bills.
California needs to put about 70 different global warming measures into place before 2020. Nearly half of them will be implemented in the next two years.
Three of those programs, which account for about 45 percent of the greenhouse gas reductions envisioned under the law, are monumental undertakings.
They include:
• A cap-and-trade system that would place a ceiling on the amount of carbon that oil refiners and utilities can emit each year.
• The low-carbon fuel standard, which requires a 10 percent reduction in the carbon content of gasoline and other transportation fuels.
• The Pavley Vehicle Standards, which set new emission standards for cars and light trucks built after 2009.
Signed by Gov. Arnold Schwarzenegger, the climate change law, also known as the Global Warming Solutions Act of 2006 or AB 32, seeks to reduce the amount of carbon emissions in California to 1990 levels by 2020.
That represents a decline of about 174 million metric tons of carbon a year – or about 15 percent – from today's levels.
Proposition 23, which was backed financially by out-of-state oil companies, would have suspended AB 32 until the state's unemployment rate dropped to 5.5 percent for four consecutive quarters, from the current 12.4 percent.
Jon Costantino, a former ARB official and a senior adviser with the law firm of Manatt, Phelps & Phillips LLP, said the state faces a tremendous task in setting up the programs now that the ballot-initiative challenge is over.
In the short term, he said, the agency will focus much of its energy on cap-and-trade, the biggest program.
The cap-and-trade system, set to begin operating in January 2012, will limit the amount of carbon the state's 500 largest polluters can send into the air. Each company will receive an allowance for the amount it is allowed to emit.
Companies that pollute less then their limit can sell their unused allowances to companies that pollute heavily, creating market incentives for everyone to reduce emissions voluntarily.
By gradually lowering the total emissions cap over time, the state hopes to achieve overall reductions in carbon.
Late last month, the air board issued more than 3,000 pages of proposed rules outlining how the cap-and-trade system would work. The board is scheduled to vote on them in December.
"It's going to be critical for them to get it right because there's going to be political pressure the whole way," Costantino said.
Proposition 23's supporters say they will continue trying to exert influence on the rule-writing process. They predict the climate change law will kill jobs, increase consumers' energy bills and raise the cost of doing business in the state.
"As the actual regulations under the global warming law begin to take effect, it will become obvious that the costs far outweigh the benefits," Jon Coupal, president of the Howard Jarvis Taxpayers Association and co-chairman of the California Jobs Initiative committee, said in a news release.
"Families and taxpayers will learn too late that the bill for California's multibillion dollar hidden energy tax will fall squarely on their shoulders."
Schwarzenegger, who took part in Wednesday's conference call with reporters, called Proposition 23's landslide defeat "a huge, huge victory" for California, the state's environment, the green-tech industry and job growth.
He said he hopes to take the same coalition that defeated the ballot measure – which includes Republicans, Democrats, environmentalists, organized labor and high-tech entrepreneurs – to Washington, D.C., where efforts to pass national climate change legislation have faltered.
"This was a victory over … greedy oil companies from Texas who are trying to flex their muscles," he said.
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