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Designing Cap and Trade to Protect Public Health
Posted by Walt Vernon on January 08, 2010 at 9:45pm
As many of you know, the State of California passed the “Global Warming Solutions Act” in 2006. Otherwise known as Assembly Bill (AB) 32, this law requires the state to develop regulations, including “market-based mechanisms” (i.e. cap and trade system) that will lead to reductions of greenhouse gas emissions. And, for people NOT living in California, this is important because California’s regulations often foretell similar regulations that eventually make their way to the rest of the country. What is new in the California planning is an effort to tailor the cap and trade system to better protect public health. This should therefore be of at least passing interest to healthcare organizations - if nothing else, these kinds of regulations should lead to reductions in asthma cases in our EDs.
AB 32 requires the State, in designing its regulations to reduce emissions, to also “maximize additional environmental and economic co-benefits for California, and [to] complement[] the state’s efforts to improve air quality.”
California has therefore created a multi-agency panel called the “Climate Action Team Public Health Workgroup” to think about how to do this. They are looking at two different methods. First, they are considering taking some of the revenues that would be generated for the state from a cap and trade system, and investing those funds in measures targeted at reducing toxic emissions in particular locations. The second approach they are considering would be to allow emitters different abilities to purchase offsets, depending on where they are located. This would make it harder and more expensive to be an emitter where there are more, and more sensitive populations. The problem with this second approach is that this kind of rule might have the result that emitters simply move away and therefore reduce not at all (also known as"leakage”).
The upshot for building owners in California (and probably, eventually, the rest of the country), is that it is going to cost more to emit, and probably to consume energy at all. A slow, methodical, disciplined program, then, to reduce energy consumption would be a wise hedge against these kinds of effects. Knowing your emission levels, too, through a greenhouse gas inventory, would be a low-cost help to plan for potential future regulations (by the way, this would be more useful for this purpose if done on a building-by-building way, rather than as a total enterprise, for multi-building owners). None of this is required right now, but what is the worst that could happen through saving energy?!
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