States continue to take the lead in mandating greenhouse gas (“GHG”) emission reductions. Most recently, Florida and New Jersey have entered the fray, with New Jersey’s recent passage of the Global Warming Response Act, and with Florida Governor Charlie Crist’s signature of three executive orders mandating GHG reductions as well as significant new energy efficiency and regulations. Whether other states will follow the lead of these two populous and influential states remains to be seen. However, the New Jersey and Florida enactments evidence the continuing trend at the state level to legislate mandatory reductions in GHG emissions in the absence of federal legislation.
The Florida Executive Orders
On July 13, 2007, Florida Governor Charlie Crist signed three executive orders under the auspices of the Florida Air and Water Pollution Control Act. The orders establish ambitious deadlines for the reduction of GHG emissions from energy utilities and mobile sources and set timeframes for the reduction of GHG emissions by state agencies and departments. Although the executive orders are not restricted to carbon dioxide emissions (the term “greenhouse gases” is left undefined), they also seek specifically to reduce Florida’s CO2 emissions by directing state agencies to implement specified energy efficiency measures.
The prefatory clauses of each executive order avert to the rapid growth of Florida’s GHG emissions in recent years, and also cite coastal Florida’s extreme vulnerability to rising ocean levels and violent weather that may be precipitated climate change – the same injuries relied on by the State of Massachusetts to show it had standing to sue in Massachusetts v. EPA, recently decided by the U.S. Supreme Court.
Of the three orders, Executive Order 07-127 is the most significant for industry sectors with high GHG emissions. Titled “Immediate Actions to Reduce Greenhouse Gas Emissions within Florida” (“E.O. 07-127”), the order establishes ambitious GHG reduction targets for the entire state. By 2017, GHG emissions statewide must be reduced to year 2000 levels; by 2025, emissions must be reduced to 1990 levels; and by 2050, emissions must be reduced to 20% of 1990 levels. E.O. 07-127 directs the Florida Department of Environmental Protection (FLDEP) to promulgate emission controls on utilities to match the statewide limits. With regard to mobile sources, the order requires FLDEP to adopt a statewide diesel engine idle reduction standard and also to implement vehicle emission standards promulgated by the California Air Resources Board, pending approval by the U.S. Environmental Protection Agency of California’s request for a waiver of federal Clean Air Act preemption with respect to those standards.
E.O. 01-127 also includes several energy conservation provisions. It directs the Florida Department of Community Affairs to adopt more stringent energy efficiency standards for new building construction and for consumer products. It also directs the Florida Public Service Commission to open the state’s utility sector to renewable energy technologies by implementing a 20% renewable portfolio standard for all utilities, adopting new standards to facilitate distributed generation (the small-scale production of electricity at or near the location where it is consumed) and initiating rulemaking to authorize net metering.
Executive Order 07-126, “Leadership by Example: Immediate Actions to Reduce Greenhouse Gas Emissions from Florida State Government” (“E.O. 07-126”), addresses GHG reductions by the state government itself, establishing emission reduction targets for state agencies and departments. These include a 10% reduction from current emission levels by 2012, a 25% reduction from current emission levels by 2017, and a 40% reduction from current levels by 2025. The order also requires state agencies and departments to adopt the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) standards for new and existing state-owned buildings, and to adopt measures to increase the fuel efficiency of state-owned vehicle fleets.
Finally, Executive Order 07-128, “Florida Governor’s Action Team on Energy and Climate Change” (“E.O. 07-128”), creates the Florida Governor’s Action Team on Energy and Climate Change, which is called on to develop a comprehensive statewide Energy and Climate Change Action Plan to achieve or surpass the statewide GHG emission reduction targets established in Executive Order 07-127. E.O. 07-128 directs the Action Team to consider a wide variety of policy options for GHG emission reductions, including market-based regulatory schemes, low-carbon fuels, geological carbon capture and storage, and biomass storage of carbon.
The executive orders were signed at a summit on global climate change held in Miami on July 12-13, 2007. At the same conference, Governor Crist signed climate change “partnership agreements” with the United Kingdom and Germany. According to the Office of the Governor, these agreements “will increase climate-friendly trade between the State of Florida and the Federal Republic of Germany and between the State of Florida and the United Kingdom.”
The New Jersey Global Warming Response Act
On July 6, 2007, New Jersey Governor Jon Corzine signed into law the New Jersey Global Warming Response Act, P.L. 2007, c. 112 (the “GWRA”), making New Jersey the third U.S. state (after California and Hawaii) to enact binding GHG reduction legislation.
The GHG reductions mandated by the GWRA – as well as several other substantive provisions of the law – echo those called for in an executive order issued by Governor Corzine on February 13, 2007, N.J. Executive Order No. 54 (Feb. 13, 2007).
The GWRA requires New Jersey to reduce GHG emissions to 1990 levels by 2020, which corresponds to an approximately 20% reduction. By 2050, GHG emissions must be reduced by 80% below 2006 levels. The statute defines “greenhouse gas” broadly to include the six most prevalent GHGs – carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulfur hexafluoride – as well as any other substance determined by the New Jersey Department of Environmental Protection (“NJDEP”) to contribute significantly to global warming. The GWRA vests the NJDEP with primary responsibility for bringing about the specified GHG reductions, but neither authorizes a particular GHG control scheme nor vests in NJDEP the authority to adopt its own measures. Rather, the statute requires NJDEP, in coordination with other state agencies, to evaluate various policy options and make specific recommendations to the governor and state legislature on how to achieve the specified reduction levels. Recommendations for achieving the year 2020 reductions must be prepared by June 30, 2009; recommendations for meeting year 2050 requirements must follow by June 30, 2010. NJDEP also must establish inventories of current, 1990, and 2006 emissions, and implement a statewide GHG emissions monitoring regime by January 1, 2009.
The GWRA also authorizes regulation of the utility sector aimed at increasing energy efficiency and reducing GHG emissions. The statute authorizes the New Jersey Board of Public Utilities to implement energy efficiency portfolios for electricity and gas utilities, to reduce consumption of these resources in the year 2020 by 20% from projected levels. However, utilities are expressly allowed to contract with other entities in order to meet these regulatory requirements. The act contains express provisions to prevent emissions “leakage,” which occurs when in-state consumers or utilities, which are subject to GHG or efficiency regulations, purchase power from unregulated sources outside the state, causing more GHG emissions than would occur if these consumers were forced to purchase from a regulated entity.
The emission reduction levels set by the New Jersey statute are ambitious, but the deadlines are far off and it is a matter of speculation when any concrete reduction measures will take effect. At a minimum, it is unlikely that the governor or state legislature will even authorize rulemaking until after NJDEP provides its first recommendations in mid-2009. Also, it remains to be seen how New Jersey will reconcile the GWRA’s mandates with the state’s commitments under the Regional Greenhouse Gas Emissions Initiative (“RGGI”). With the exception of a generic provision preserving the existing authority of the NJDEP and other state agencies to limit or regulate GHG emissions, the GWRA is conspicuously silent on the subject of RGGI.