2010: Looking forward on AB32 implementation

By CMTA Staff

Capitol Update, Jan. 22, 2010 Share this on FacebookTweet thisEmail this to a friend

Unfortunately, on the greenhouse gas front, we still do not have a sound, valid economic analysis of what the true costs will be to implement AB 32, the landmark global warming law.   After, the California Air Resources Board’s (CARB) first analysis was heavily disputed by many peer reviews, the Board is reportedly coming out with an improved economic analysis in February. 

CMTA believes it is extremely difficult to design cost-effective and technologically feasible programs that help reach AB 32 emission reduction goals and improve our economy.  We hope the new analysis will provide realistic cost estimates in which to make policy decisions.

A recently proposed cap-and-trade system foists a $143 billion carbon tax (at $60 per ton) on the economy over eight years. That kind of tax puts thousands of Californians at risk. Universities, ports, airports, public utilities, wineries, food processors, cement plants, glassmakers and others would be hit with this tax.
Consumers will also bear the brunt of the tax through higher electricity and natural gas bills, and higher prices at the gasoline pump. For example, the tax at $60 per ton would mean 53 cents more per gallon of gasoline and $200 more for a family’s electricity costs.
Those costs are in addition to other AB 32 programs that will raise consumer prices.  Overall electric bills are estimated to rise 30-60 percent. Also expected is a  $3.7 billion increase for gasoline and diesel costs and a $50,000 hike in the cost of a new home.

California is currently developing a cap-and-trade regulation without assurances that other states will participate.  A program that only applies to California or a limited number of states will put California employers at an even worse competitive disadvantage, driving jobs out of the state.

CMTA continues to be a constructive voice in the implementation of AB 32, advocating these principles:

1.    Provide regulatory certainty;
2.    Adopt policies that keep jobs in California and achieve global emission reductions (Leakage);
3.    Use sound scientific methods of review;
4.    Impose only cost-effective & technologically feasible regulations;
5.    Promote innovation and market-based strategies;
6.    Minimize and fairly allocate compliance costs;
7.    Link to regional and national climate policy initiatives, and
8.    Coordinate AB 32 with existing air and environmental quality standards.

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