By Andrzej Zwaniecki
USINFO Staff Writer

Washington – U.S. clean energy initiatives at the state level have stimulated debate on the need for carbon dioxide emission standards and are testing policy solutions aimed at curbing greenhouse gas emissions linked to global warming, experts say.

Two major regional initiatives in the United States’ Northeast and West that target specific reductions of greenhouse gas emissions have elevated national discussions about climate change, particularly within the federal government, these experts say.  Some major companies, faced with a possibility of having to deal with a patchwork of state and local regulations, have called on the federal government to develop reasonable nationwide emission standards.

Greenhouse gases trap in the atmosphere the infrared radiation (heat) of sunlight reflected from the Earth’s surface. Some of these gases occur naturally, others are exclusively man-made. Most significant among them, carbon dioxide is both produced naturally by trees and plants and artificially by industrial and transportation sources. Its releases to the atmosphere have increased considerably due to human activity.

Although businesses and environmental groups differ, sometimes considerably, on how strict emissions’ mandates should be, they tend to agree that a uniform federal program is preferable to numerous state and local standards, says Judi Greenwald, the director of innovative solutions at the Pew Center on Global Climate Change.

STATES AS POLICY LABS

The Bush administration and Congress are looking closely at state actions as a useful source of analysis and lessons learned.  In the past, U.S. states have taken the lead on such issues as air pollution control and welfare reform, and have experimented with policies that later helped shape federal laws and regulations.

The Bush administration welcomes state and local initiatives because they add to the administration’s multipronged approach to climate change, according to James Connaughton, chairman of the White House Council on Environmental Quality. But the Bush administration has favored a technology- and incentive-based drive to limit greenhouse gas emissions as opposed to mandatory caps.

The Democratic Party-controlled Congress also seems to be taking a broad approach. But it does not exclude the possibility of compulsory measures such as the carbon emission regulations that are part of state and regional initiatives.

At a March hearing, Senator Barbara Boxer, the chairwoman of the Senate Environment and Public Works Committee, said regions, states and cities “are sending us a signal that we should heed.” (See related article.)

Kenneth Green of the American Enterprise Institute (AEI) told USINFO April 23 that he is comfortable with the idea of state initiatives but suspects the real motivation behind states’ actions is an attempt to force a uniform nationwide carbon regulation. This would be imposing their particular priorities on the entire nation, Green said.

Greenwald sees it differently. State actions are “feeding into the federal debate in real time,” and that is good, she told USINFO April 18. But it does not necessarily mean that Congress or the administration will replicate policies followed by certain states, she added.

CAN STATES MAKE A DIFFERENCE?

Greenwald said the RGGI, with the most detailed implementation plan so far, is a particularly important model for other states and the federal government to study. Launched in 2005 by Connecticut, Delaware, Maine, New Hampshire, New Jersey, New York and Vermont, it is a mandatory cap-and-trade program for carbon dioxide emissions from power plants. Under the program – joined this year by Maryland and Massachusetts with Rhode Island promising to follow soon - emissions will be capped starting in 2009 at then-current levels and then reduced by 10 percent below 2009 levels by 2019. 

In September 2006, California Republican Governor Arnold Schwarzenegger signed the California Global Warming Solutions Act, which provides for gradually reducing the state’s greenhouse gas emissions from major industries to 1990 levels by 2020. Illinois has set similar targets.

In February, Western states - Arizona, California, New Mexico, Oregon and Washington - agreed to cut greenhouse gas emission across a range of sectors and set specific common targets by September 2007.

California also enacted a law targeting greenhouse gas emissions from passenger automobiles. At least 13 states plan to adopt a similar mandate if it clears California courts, where automakers have filed a legal challenge, according to Greenwald.

Supporters say state and regional initiatives will have significant environmental impact, and that mandatory carbon dioxide standards will drive technology innovation, job creation and investments in clean energy.

AEI’s Green said these expectations are naive and reflect a belief that government planners can make more intelligent decisions than markets acting on the will of millions of people.

“In California, they are particularly prone to this fallacy,” Green said.

California promoted wind energy, solar energy and electric vehicles arguing that they will create new industries, he said. “So far it hasn’t happened,” Green added.

He and other skeptics say the regional initiatives will not accomplish much because rapidly rising levels of greenhouse gas emissions from large developing countries such as China and India will render reductions by individual states as insignificant.

Opponents also say emission caps will drive up costs for producers and consumers and drive businesses to states with no emission caps.

Margo Thorning, in a 2006 study for the American Council for Capital Formation, said the projected 20 percent increase in California’s population between 2004 and 2020 will make achieving the state’s emission-reduction targets “very challenging.”

Greenwald said she remains skeptical of any cost estimates until state regulators lay out policy options for implementing the California law.  An extensive analysis of the more modest Northeastern initiative, she said, indicates that the cost of RGGI is likely to add less than 1 cent per kilowatt hour to the price of electricity.

More information on RGGI is available on the initiative’s Web site.

For more information on U.S. policy, see Climate Change and Clean Energy.