Ecocentric

Obama Talks Climate Change. California Is Acting on It

Obama warmed the hearts of environmentalists when he called for climate action during his Inaugural Address, but political realities may tie his hand. In California, things are very different

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Brian L. Frank / Redux

The Salton Sea area of California's Imperial Valley was once a thriving tourist destination, but it deteriorated and dried up from the effects of global warming

It’s not the happiest time to be an environmentalist. Climate change hit home last year with brutal force: 2012’s historic drought singed much of the Midwest, turning farms to dust and withering the corn crop. Other parts of the U.S. suffered through storms like Sandy and massive wildfires. Average annual temperatures in the continental U.S. beat the previous recorded high by a full 1°F (1.8°C). And the future is uglier still: over the weekend, British economist Nicholas Stern warned that climate change could be even worse than he predicted in his sobering 2006 report on the financial impact of warming, while on Jan. 28 the National Oceanic and Atmospheric Administration released a draft report outlining the serious threat sea-level rise poses to the coastal U.S.

So, logically, 2013 should be the year the U.S. finally gets serious about dealing with the man-made greenhouse-gas emissions that drive warming. And greens could take some hope in President Obama’s Inaugural Address on Jan. 21. “We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations,” Obama told his audience. But whatever the President’s intentions, political realities — including a House led by Republicans who want nothing to do with climate-change legislation — will limit his scope of action. At most, the White House may be able to tweak the tax code or spend more on research for clean energy. Useful policies, but nothing as comprehensive as the climate legislation that was introduced, and ultimately defeated, during Obama’s first term.

But if environmentalists look west from Washington — about 2,728 miles west — they’ll see reason for hope. On Jan. 1, after years of preparation and legal battles, California launched a carbon cap-and-trade system, establishing a declining limit on the state’s greenhouse-gas emissions. That means that the most populous state in the U.S. and the ninth biggest economy in the world has legally committed itself to reducing its carbon emissions to 1990 levels by 2020.

While cutting California’s carbon emissions alone might not make a big dent in climate change (the state is responsible for perhaps 1% of global emissions), the success or failure of its environmental experiment may well decide whether national or even international action on global warming ever becomes a reality. “California is a big economy, and it is very diverse, like the U.S. as a whole,” says Mary Nichols, chairman of the California Air Resources Board (CARB), which is overseeing the cap-and-trade system. “If it can work in California, it can work in the U.S.”
(MORE: As the World Keeps Getting Warmer, California Begins to Cap Carbon)

The challenge will be getting it right. California’s government isn’t the first to try to put a cap-and-trade program in place. In 2005 the E.U. launched its Emissions Trading Scheme (ETS), a system that covered large factories and power plants in 31 countries throughout the continent. But while European emissions have declined since ETS was launched, the system has been troubled. The price of carbon permits on the open market crashed in 2007, in part because the cap was set too high and companies were given too many free permits. That didn’t stop utilities from raising electricity prices, ostensibly to cover the cost of complying with ETS, allowing them to rake in windfall profits. The E.U. “gave the carbon permits away, and then they were outraged when companies raised their prices,” says Severin Borenstein, a co-director of the Energy Institute at the University of California, Berkeley. “Economists could have told them that would happen.” Regulators have closed some of those loopholes in ETS, but the still operational trading system continues to suffer from its wobbly launch.

California, which has been working on cap and trade since 2006, has the advantage of hindsight. CARB has been collecting data on carbon emissions for years, which should help regulators set an accurate carbon cap — not too high and not too low. Offsets can make up no more than 8% of a company’s carbon responsibility, and the state is tightly regulating the programs that manage them. Most important, California will auction a portion of carbon permits to companies each year rather than giving them all away. That should limit windfall profit-taking by utilities, as will a requirement that California households receive a dividend twice a year from the money raised by the carbon system. “The auction prevents companies from banking their permits and then passing on the price to customers,” says Tim O’Connor, director of the Environmental Defense Fund’s California Climate and Energy Initiative. “It helps protect the integrity of the entire program.”

(MORE: U.N. Global-Warming Summit: Heading over the Climate Cliff)

California held its first auction for carbon permits in November, and the results were mostly promising for the future of the system. The available permits for 2013 fully sold out, indicating that companies are taking the system seriously. But the permits sold at just above the regulated price floor of $10 per ton of carbon, and permits for 2014 and 2015 did not fully sell out. That relatively low market price for carbon may actually be a good thing, indicating that the cap is set at a realistic level that companies think won’t be too difficult or expensive to meet. (If businesses anticipated that the cap would be too low, they would have purchased more permits, driving up the market price of carbon.) But the unsold 2014 and 2015 permits could also indicate that businesses believe California might eventually back off from capping carbon, especially if the state’s economy struggles or if climate-skeptic Republicans take back Sacramento. “There’s definitely some regulatory risk reflected in the market, especially projecting forward,” says Olga Chistyakova, a senior analyst at Thomson Reuters Point Carbon. “That’s putting a downward pressure on prices.”

That worry may not be misplaced. The November auction went forward despite a lawsuit filed by the California Chamber of Commerce that contends the sale of permits constitutes an illegal tax, but the legal woes add to worries about the long-term viability of the system and its impact on California’s still shaky economy. “We already have state electricity costs that are 50% higher than the national average and declining investment in manufacturing,” says Dorothy Rothrock, vice president of government relations for the California Manufacturers and Technology Association. “You’re going to go backward on the economy.”

It’s true that cap and trade may squeeze the margins of fossil-fuel businesses, though California’s relatively lenient cap should reduce that impact. But it should also benefit clean-tech industries like solar and lithium-ion batteries — a sector of the economy in which California, with the help of Silicon Valley’s capital and innovation, is already lapping the rest of the country. Either way, the reality is that with cap and trade, the state is embarking on an economic and environmental experiment. For all his bold talk on global warming during his Inaugural Address, President Obama has also said he “won’t ignore jobs and growth simply to address climate change.” During a time of deep economic insecurity, climate action will be politically viable only if it can accompany prosperity, not interfere with it.

California is the natural place for that experiment to be carried out. From smog regulations to energy-efficiency standards, the Golden State has always led the way on environmental policy, with the rest of the country eventually following — sometimes kicking and screaming. “Climate change is only going to be solved if everyone gets involved,” says O’Connor. “But the world’s ninth largest economy doing something can only help.” If Obama’s words on warming are ever going to be more than just that, California’s climate dream needs to become a reality for the rest of us.

MORE: The U.S. Will Be an Oil Giant Again, but It Won’t Be Energy-Independent

74 comments
FreedomFan
FreedomFan

"The Salton Sea area of California's Imperial Valley was once a thriving tourist destination, but it deteriorated and dried up from the effects of global warming"

- Bryan Walsh

Bwahahaha!  That's a good one.  Can you tell us one of the popular restaurants?  Hotels?  What a crock!  My wife has lived in California since 1950 and the Salton Sea has always been a disgusting joke.

The author is indeed a clueless fool.

MelbaVonEye
MelbaVonEye

To those that oppose efforts to slow global warming:  What is it that you think would not be beneficial about having cleaner air to breath for yourself and your children and your children's children?   Oh, it's the money.  Ok selfish motives.   

It has nothing to do with global warming... it has everything to do with the health of everyone.  How much would you pay to keep your children healthy?  I don't know about you, but I would gladly give my life if I had to.

Dude2
Dude2

I got no further than the caption that indicates global warming (implying man made global warming) caused the Salton Sea to evaperate... CNN, please do your homework!!!  From Wikipedia:

http://en.wikipedia.org/wiki/Salton_Sea
As a result, the Salton Sink or Salton Basin has long been alternately a fresh water lake and a dry desert basin, depending on random river flows and the balance between inflow and evaporative loss. A lake would exist only when it was replenished by the river and rainfall, a cycle that repeated itself countless times over hundreds of thousands of years – most recently when the lake was recreated in 1905.[3]

rockriver
rockriver

The worst omen is Obama's predictable statement that he is unwilling to prioritize action on climate change ahead of economic growth, which is exactly the source of humanity's effect on the climate. The past century's dramatic growth trend must stop, and we are lost until we admit that such growth is neither normal nor sustainable. 

EC123
EC123

Climate change is occurring.  But to say that our drought last year or that Sandy was definitively caused by climate change is just bad science.  Statistical blips occur in any system, and all that matters is long-term trends.  The Earth's climate system is an enormous system, and there are apparently several metastable climate patterns - from ice ages to dust bowls.  It will take many decades to see where it all will settle as a result of two hundred years of fossil fuel use.  To say a single event or even a decade of events are due to "global warming" is simply misleading and sensationalism by the media.

bounty
bounty

While cutting California’s carbon emissions alone might not make a big dent in climate change—the state is responsible for perhaps 1% of global emissions—the success or failure of the state’s environmental experiment may well decide whether national or...<a href="http://www.iafrica.tv">news</a>

mrl2130
mrl2130

1 degree F is 0.55 degrees C, not 1.8 degrees C.

TomS
TomS

You need to look at the man behind the curtain. AGW is a massive fraud and con.  It is simply a way to legally steal from hard working people either through taxes or higher prices in everything from food to medicine.  The whole AGW was dreamed up by the UN to redistribute wealth from reach to poor countries via cap and trade.  Enron pushed for it as a new commodity.  Academia pushed for it to get funding.  The natural gas producers pushed for it to compete with coal. Politicians pushed for it to get votes.  The construction industry pushed for it to increase building costs.  Manufacturers pushed for it to created demand for uneeded products. Farmers pushed for it for ethonal.  Al Gore pushed for it to make millions.  The wind industry pushed for it to get gov subsidy. Dumb journalists pushed for it to show they are smart.  The environmentalist pushed for it for the obvious.  The weapon is fear and the common motive is money and not science.

windbourne
windbourne

Actually, cap/trade is the WORST idea going. 
BUT, there is an intelligent one. Basically, get every nation to lower their CO2. Now, there is no way to make that happen. China is building 2-4 new coal plants WEEKLY. Worst yet, they will continue to run those without pollution control, regardless of the impact on its citizens.
So, how do you get all nations to change?
By having the heaviest importer tax all goods, based on the CO2 that is emitted by that nation.
Now a couple of things.
1) we need a REAL way to measure it. The estimates that are done are a joke. Instead, we need OCO2 up and taking measurements. That happen next year.
2) we need a way to normalize this. Many push per capita, yet, that is one of the worst measures. The reason is that CO2 (and other pollutants) are tied not to ppl, but to GDP. For example, China has not change population that much over the last 20 years. OTOH, they went from a low-end polluter to the TOP polluter. Why? Because their GDP jumped.  So, the right way is $ GDP per tonne of CO2. You want to increase this to as high as possible.
3) nations will manipulate their money. Basically, they will for their exchange rate down so as to export more. So, the right way to do the calculation is to use actual $, and not PPP (purchasing power parity).
4)  This tax should start low and go high. The lower your GDP/tonne, the higher % you pay on goods that come to a nation. For USA, we should also tax each state based on that.
5) a number of nations are pulling games and do the vast majority of work in one nation, then move it to another for assembly and declare it as the later. So, this should be based on the nation of assembly AND the top 3 components. 

If we do this, then all nations have a strong interest in lowering their CO2.
This also had the advantage ot rewarding those that keep the emissions down, while discouraging those that will pollute more as success hits. 

Sam.Q
Sam.Q

You need to go back to school -- When one Fahrenheit  is 1.8 Centigrade?!!!!

Fahrenheit To Centigrade:
5/9 * (Fahrenheit - 32); or  0.55555 = 5/9

S t u p i d

GaryRMcCray
GaryRMcCray

At this point Global Warming Deniers are at about the same level of credibility as Evolution deniers.

Come to think of it you are probably the same misguided fundamentalist Christians.

And as looks pretty probable now when the SoyLent Green Human Extinction outcome of this mess becomes so overwhelmingly obvious to you that you can't ignore it any longer you are probably going to spout off some nonsense about Gods will.

I was clearly born on the wrong planet.


denmarks47
denmarks47

If China, Eastern Europe, and the Soviet States could get on board this might mean something.  They won't and we will end up paying higher prices on products affected by this grand idea.

thinkfromabove
thinkfromabove

We have DOMINION over EVERYTHING physical, including THE WEATHER!

If everybody believes and repeats the BUNK about "global" (earth is NOT a spinning BALL, balls HAVE NO HORIZON, for instance) warming, such warming is the result, but would not be, if they'd stop confirming it.

jhoughton1
jhoughton1

"The challenge will be getting it right."

Why does California have to lead the way, every time?  How many times do Californians have to be right about clean water, worker safety, auto safety and mileage, product labeling, food inspection, etc. before other states just jump on board without the obligatory (chicken-hearted) waiting period?  With climate change, we don't have time to "wait and see how it turns out in California"!!

BorisIII
BorisIII

Finally the global warming issues has gone from is it real, to is it caused by carbon monoxide out put, to can we afford to stop global warming.  I think that is a big step in the right direction. 

Derrick.T
Derrick.T

Given that China's Co2 emissions will increase equal to the U.S's current Co2 output in 5 years time, it seems this story total missed the reality of reducing global Co2 emissions. The green zombies continue to focus on a carbon tax, while ignoring the negative externalities associated with alternative energies. Why not discuss a tax on all energy types? It's been 12 years and the democrats haven't brought a comprehensive energy tax up once. It would promote conservation instead of unfairly targeting the Midwest states.

shepherdwong
shepherdwong

Dear Mr. Walsh: that is very sweet. So a slowly evolving, politically fraught program, expected to be implemented by a skeptical (if not outright hostile) industry, in a geography that accounts for perhaps 1% of greenhouse gas emissions, is going to somehow reverse what you describe in your first paragraph?

Those of you with the courage to take on the climate-deniers may as well start telling people the important truth. We are facing cataclysmic warming that is already taking place and will cause catastrophic effects on human civilization, even if we shut off every car, truck and power plant in the world tomorrow. You may as well start preparing people for whatever hair-brained plan to re-engineer the climate our government is going to try selling us withing the next decade or so.

DavidNutzuki
DavidNutzuki

Time please get up to date:

*Occupywallstreet does not even mention CO2 in its list of demands because of the bank-funded carbon trading stock markets ruled by corporations and trustworthy politicians

*Canada killed Y2Kyoto with a freely elected climate change denying prime minister and nobody cared, especially the millions of scientists warning us of unstoppable warming (a comet hit).

*Obama has not mentioned the crisis in the last two State of the Unions addresses.

*In all of the debates Obama hadn’t planned to mention climate change once.

Find me one, just ONE single IPCC warning that says a crisis will actually happen, not just might and could happen. Not one of the IPCC warnings are without “maybes” and 27 years of "maybe" means it "won't be" a crisis.

GeraldWilhite
GeraldWilhite

Mr. Walsh, you forgot to tell your readers about the AGW elephant. 

Many scientists and laypersons following AGW and cAGW research point to a mountain of new evidence from around the world that is strongly suggests the AGW hypothesis belongs in the scientific trashcan. Contrary to AGW's prediction, while CO2 has gone up 8%-9% over 15-16 years, temperature has not increased. This wasn't supposed to happen. The implications for California's carbon cap and trade system and many other CARB programs are profoundly negative. 

I hereby grant you forgiveness for your oversight since US news coverage of this new development has been almost nil. 


RedTapeMovement
RedTapeMovement

Dear Bryan,

UNIPCC2007 report has predicted dark future of the earth. Here are few suggestions, which needs urgent attention:

1. There should be a “WORLD COMMISSION FOR SCIENCE AND DEVELOPMENT” for promoting the researches and developmental works which have zero to low carbon emission.

2. There should a compulsory constitutional amendment to make “ENVIRONMENTAL WAY OF LIFESTYLE” a compulsory duty.

3. Our investment in R & D should be more on the forthcoming areas like solar, tidal, wind and water energies apart from on lowering carbon emission.

4. There should be a big role for N.G.Os. in implementing environment friendly plans & projects of government.

5. There should be effective AWARENESS programmes, at grass root level, to save the environment & terrestrial “CO2 sink zones” i.e. forests from degradation. One such movement, running in Etawah district of Uttar Pradesh province of India, is RED TAPE MOVEMENT [http://unfccc.int/cc_inet/cc_inet/six_elements/public_participation/items/3530.php?displayPool=1526 & http://twitter.com/RedTapeMovement. Such movements will be helpful in the conservation & safety of forests and biodiversity, with the help & involvement of local peoples.

6. There should be the provision of financial help and green technology transfer to developing countries because the problem of Climate Change is GLOBAL & inter-related; it will be helpful in phasing-out the fossil fuels. Recently, Dec. 2012, The European Commission and the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) have each announced a €5 million contribution to United Nations Development Programme (UNDP) to help assist 25 developing countries around the world reduce their greenhouse gas (GHG) emissions.
7. Sustainable developments should be given priority. But recently it was reported by rainforestportal.org, on April 16, 2012, that sustainable management is not playing a good role in Rainforest areas as it is destroying Primary Rainforest [http://www.rainforestportal.org/issues/2012/04/earth_meanders_the_great_rainf.asp]. The portal says, “Old forests are a vital part of the biosphere’s ecological infrastructure – and have a prominent, central role in making the Earth habitable through their cycling of carbon, energy, water, and nutrients. Primary rainforests cannot be logged in an ecologically sustainable manner; once logged – selectively, certified, legally or not – for throw-away consumer crap, their primary nature is destroyed, and ecological composition and dynamics are lost forever”. So, on the name of Sustainable Management [http://www.brisbanetimes.com.au/environment/animals/extinction-risk-as-aceh-opens-forests-for-logging-20130114-2cpmr.html ] , no-one should be allowed to destroy forests because our terrestrial biodiversity, human population, Oxygen production, CO2 sinking etc. depends on forests.
Such steps are big BUT will be helpful in controlling GREEN HOUSE EFFECT and CLIMATE CHANGE.
Regards
Prabhat Misra
Assist. Director [ National Savings ],
Etawah, U.P., India
http://www.facebook.com/prabhat.lovepeaceunity
http://www.facebook.com/redtapemovement
http://www.twitter.com/redtapemovement
http://www.twitter.com/prabhatmisra 

http://blog.mbl.edu/?p=2104&cpage=1#comment-93872