The Many Moving Parts of California’s Climate Program

Some storylines are pretty linear and easy to follow—boy meets girl, they fall in love and live happily ever after. The End. But then there are the others. The ones that really capture the imagination of the world. The ones that take work to follow, the ones that are super complex with multiple characters, unexpected plot twists, and unbelievable events. These are the ones that have cliffhangers, sequels, and endings that are not tied up in a neat little bow but rather leave you asking, Did that really just happen? Well, let me tell you that it just did. The latest chapter in the book on California’s efforts to lead the world in combatting global climate change was just written. And, was it ever an action-packed page-turner.

It wasn’t always that way. When AB 32 was passed a decade ago, things started pretty slowly. There was a sequential nature to it all. First came the Discrete Early Action Measures (think Low Carbon Fuel Standard), then came the policy framework document known as the Climate Change Scoping Plan, A Framework for Change, after which the California Air Resources Board (ARB or Board) adopted numerous other GHG command and control regulatory measures, including the cornerstone Cap-and-Trade Program. But even Cap-and-Trade took multiple years to develop (’09), adopt (’10), finalize (’11), and begin implementation (’12) before finally starting (’13), only to be expanded in scope two years later (’15). Interspersed between all of this were several lawsuits and a really costly ballot contest in the fall of 2010—Proposition 23.

But when you look at the ARB regulatory, policy, judicial, and legislative agenda these days, it isn’t a sequential calendar, but one with multiple, interdependent and far-reaching activities all occurring in parallel with one another. ARB is within weeks of advancing a major overhaul to the Cap-and-Trade regulation, pushing it from its initial 2020 sunset to 2030 and outlining its provisions to 2050. This is no small task in and of itself. But the Board is also pursuing major amendments to the LCFS, revising the Scoping Plan for post-2020 policies, adopting a major oil/gas methane regulation, shifting focus to highlight benefits to Environmental Justice (EJ) communities, finalizing an Adaptive Management program, rolling out a Short Lived Climate Pollutant Strategy, overseeing the expenditure of over a billion dollars in Cap-and-Trade auction revenues, while simultaneously fighting a major legal battle and working to secure the additional legislative authority to do what they had already begun doing. Whew! (Just typing that last sentence made me tired.)

The big unknown in the 2016 act for AB 32 was if there would be a sequel? 2015 didn’t produce one. Though that question was answered with the passage, and signing last week, of SB 32 by California Governor Jerry Brown. But unlike when AB 32 was signed in 2006, this time ARB doesn’t need to hire 144-plus staff positions, train them and get them up to speed on how the future should look. California’s climate change regulatory machine is already up and running.

What is new this time around is the shifting focus of support for the program. No longer are those lines of support and opposition clearly delineated. Now there are backers and attackers from industry, as well as a diverse set of engaged environmental groups. This composite of stakeholders is what made the passage of SB 32, and its married-at-the-hip AB 197, such a compelling story this summer. Thanks to AB 197, the ARB will now have direct legislative oversight, termed appointments and will have to sort through what it means to “prioritize…direct emission reductions” in an effort “to protect the state’s most impacted and disadvantaged communities.” From its inception through 2014 the ARB was strictly the Governor’s agency, as highlighted by its makeup of 100% at-will Board appointments. Then last year legislative appointees were added and now the dais will literally need to be expanded to make room for additional nonvoting ex officio members of the Legislature. These members, and their additional oversight responsibilities, were part of a GHG bill package, but they will be there when votes are cast on numerous major non-GHG issues like diesel trucks and zero emission vehicles. It can be anticipated that this change will have a more dramatic long-term impact on the ARB than any pending court decision.

Since we are on the subject of pending court decisions, it must be acknowledged that the current lawsuit threatening some foundational aspects of the Cap-and-Trade program is like that wildcard storyline that hangs over the main plot. It isn’t there on every page, but since it was introduced early on, it can’t be ignored. You just know it will come back to relevance before the final chapter is written. With its timing now not expected to be decided until early 2017, the day-to-day lives in the SB 32 saga must continue regardless of its eventual impact. Auctions will be held, regulations will be updated and adopted, and revenues will be spent. But the longer the time span between starting a regulatory program and any major decision to stop or amend it, the more traumatic any potential change in momentum will have on program participants.

California’s climate change story is now more than a decade old. It certainly caught the world’s attention with its dramatic scope, diverse characters, and unending drama. As the chapter entitled “Summer 2016” winds to a close, it can be anticipated that the next six-month period will be just as riveting with its auction results, judicial decisions, and long-term policy development. So if you are already invested in this story, stick around. I am sure the storylines won’t disappoint.

This article was originally written for CaliforniaCarbon.info.