NGOs Dominate Western Climate Initiative Talks

July 30, 2008

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A 5.4 magnitude earthquake and dozens of Environmental Justice protesters didn’t slow the efforts of seven western states and four Canadian territories pushing a regional cap and trade program under the Western Climate Initiative (WCI).

The ballroom at the San Diego Marriott shook for at least ten seconds during the July 29 earthquake (the epicenter was near Los Angeles). After realizing it was an earthquake, the moderator said, “At other meetings, we’d duck under the tables at this point, but I think we’ll keep going.” There were no related injuries or damage reported.

The real excitement, however, came from speakers representing non-governmental organizations who dominated the comment period for the daylong WCI meeting, the first since debuting an updated draft plan for implementing a cap and trade program for reducing greenhouse gases last week. Speaking in support of the plan were Environmental Defense Fund, National Wildlife Federation, Sierra Club, Physicians for Social Responsibility, several labor unions and regional environmental and faith-based groups.

However, a dominant theme in the participants’ feedback was the belief that the timeline for incorporating transportation into the plan was too slow.

Many environmental advocates expressed disappointment with the plan to wait seven years before regulating transportation-related emissions. One speaker compared this strategy with a politician’s strategy of a one-term elected official: “I’m all for this new effort, but I don’t want any of the burden happening while I’m in office.”

Suzanne Iyer, a representative from Chevron, disagreed, saying the transportation industry was already required to reduce emissions by 1 billion metric tons through the Energy Independence and Security Act. She also believed the proposed 10 percent allowance for offsets seemed too low.

Other key issues discussed included the impact on the labor force, how emission allowances should be distributed and how many should be committed to an auction system, and how the proceeds from allowance auctions should be used.

Key to understanding how these issues may play out, and central to any major government program, are modeling studies to determine the costs of new regulation. The data used for the current WCI model needs updating: it currently includes oil prices at 2007 prices, and anticipated less than $100 per barrel in 2020. “The uncertainty of this model doesn’t recognize broad behavior change related to fuel costs or new technology innovations that drive efficiency.” When audience members scoffed at the data, Michael Gibbs, director of the California Air Resources Board said, “We’re operating in a world outside of historical data.”

Marta Roberts, an economist with Environmental Defense Fund, announced a new research report estimating the economic benefits of implementing climate change regulation at $68 per ton, far greater than any current estimates for carbon trading.

Amidst all the debate, the WCI plan marches on. The group is calling for commentary through August 13 and a revised plan to release in mid-September.

A representative from a Washington state electric utility told Kevin Tuerff, CEO of Green Canary Sustainability Consulting, “This thing is going way too fast. There is no way WCI governments can be ready with draft legislation by December, like they propose. There are too many details yet to be decided.”

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