Energy policy in the U.S. has become fraught with politics this election season. When a comprehensive energy bill failed in Congress this past summer, attention shifted to California.
A vastly expanded market for renewable energy in California, one of the world's largest economies, as well as a new carbon market is developing as a result of California Assembly Bill 32, commonly referred to as AB32. However, this law faces opposition in the form of Proposition 23, or Prop 23, on the ballot November 2, 2010. Prop 23 advocates refer to it as the “California Jobs Initiative” while opponents of Prop 23 call it the “Dirty Energy Proposition.”
Both supporters and opponents of AB32 in California have developed extensive campaigns to inform voters about their take on the issues. However, both sides have in common a focus on the effect AB32 will have on jobs in California alone.
AB32 Creates a Regional Market
Little of the debate has focused on the effects of AB32 outside the state of California. By establishing one of the country’s first compliance markets for carbon which will allow forestry “offsets,” AB32 would be creating a new means for small nonindustrial forest landowners to gain compensation for good stewardship across the country. (Update Regarding the Proposed Offset Component of the California Cap-and-Trade Program, July 29, 2010. arb.ca.gov Accessed October 27, 2010).
The same holds true for livestock operators. The Climate Action Reserve is the third-party offset program adopted by California under AB32. A September 29, 2010 Climate Action Reserve press release makes the point that “livestock manure management provides a key opportunity to reduce significant methane emissions, while at the same time generating revenue for the livestock operator.” (“New guidelines broaden opportunities for livestock operations to gain financial benefits from reducing their GHG emissions." climateactionreserve.org Accessed October 27, 2010.)
California Generates Regional Demand
Additionally, the size of California’s economy means that its demand for green energy will quickly spread beyond its borders, as its fossil fuel demands do now. California recently upped its Renewable Portfolio Standard to 33% by 2020.
Governor Schwarzenegger approved the action under authority of AB32, which, according to The New York Times, makes the standard “subject to the whim of California's voters as suspension of the climate law, A.B. 32, would mean a corresponding freeze on renewable energy expansion.” (Sullivan, Colin. Sep. 24, 2010. "California raises renewable portfolio standard to 33%." nytimes.com Accessed October 27, 2010). The suspension referred to in the article is Proposition 23.
New Western Energy Initiatives Would Benefit from AB32
Sarah Adler, the State Director for USDA Rural Development in Nevada, is spearheading a broad-based partnership among ranchers, federal public land agencies, researchers, and industry to restore sagebrush habitat through the removal of encroaching pinyon-juniper. An innovative component of this partnership is to use woody biomass from the trees to develop a biofuels industry in Nevada and four other western states with similar resource issues.
However, in an interview on October 25, 2010, she said “a critical issue for Nevada is what’s going on right now in California. If our Nevada Pinyon-Juniper Partnership is going to be successful in the longterm, we’re going to need the California market. That’s because we’ll be able to produce more renewable energy than the state of Nevada needs, so the California renewable portfolio standard set by AB32 is critical.”
On October 27, 2010, Steve Ruddell, president of CarbonVerde, a full-service carbon credit consulting firm, commented that a cap and trade program will carry significant upsides for industry and the economy by increasing incentives for new alternative energy technologies. The problem is “it's hard to quantify those positives before they happen.” In his opinion, that is why the issue has become so volatile this election season.
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