While Congress continues to struggle in its efforts to develop a federal legislative strategy on global warming and climate change, individual states are carrying forward their own proposals to address greenhouse gas ("GHG") emissions on a regional level. The latest manifestation of this trend comes with the issuance by the California Air Resources Board ("CARB") of its June 2008 Climate Change Draft Scoping Plan, developed pursuant to the state's Global Warming Solutions Act of 2006 (Assembly Bill AB 32).

AB 32 was the first legislation in the United States to address climate change in a comprehensive way. The law requires a statewide reduction in GHG emissions to 1990 levels by 2020. CARB took the first steps to implement AB 32 in 2007, when it developed a 2020 emissions cap, prepared an inventory of historic GHG emissions and issued a list of "early action" measures to achieve future emissions limitations. The Climate Change Draft Scoping Plan takes this effort to the next level by making initial recommendations for long-term implementation of California's overall climate change program.

The principal recommendations discussed in the Draft Scoping Plan include: 

  • Implementation of a broad-based cap-and-trade program that links with programs developed by other states and Canadian provinces participating in the Western Climate Initiative to create a regional market-oriented system of GHG emissions controls.
  • Implementation of motor vehicle standards adopted pursuant to the so-called Pavley Bill (AB 1493), which directed CARB to issue standards that would lower vehicular emissions to the maximum extent technologically feasible beginning with the 2009 model year. Implementation of these standards has been delayed as a result of a decision by the U.S. Environmental Protection Agency to deny California's request for a waiver of requirements of the federal Clean Air Act. 
  • Adoption of measures to enhance the efficiency of energy utilization in buildings and appliances, including adoption of a mandatory Green Building Standards Code incorporating minimum environmental performance standards for all buildings in 2010. 
  • Adoption of a more stringent Renewables Portfolio Standard for both investor and publicly-owned electrical power utilities in order to increase the contribution of renewable resources (wind, solar, geothermal, small hydroelectric, biomass and biogas) to California's retail electric load from its current level of 12 percent to 33 percent by 2020.
  •  Development and adoption of a low carbon fuel standard consistent with Governor Schwarzenegger's earlier call (Executive Order S-1-07) to reduce the carbon intensity of California's transportation fuels by at least 10 percent by 2020.
  • Adoption of new measures to reduce "high global warming potential" gases used in refrigeration systems, the manufacture of insulating foam and for other commercial purposes.
  • Identification of opportunities to preserve forest sequestration of carbon and encourage the use of forest biomass for sustainable energy production.
  • Continuation of efforts to increase water use efficiency and reduce overall per capita water use in California, and to use cleaner energy sources to transport water throughout the state.
  • Implementation of additional measures to improve light-duty vehicle efficiency.
  • Implementation of adopted regulations for port drayage trucks and the use of shore power for ships at berth in California ports.
  • Adoption of heavy- and medium-duty vehicle and engine requirements, including requirements for aerodynamic efficiency, vehicle hybridization and engine efficiency.
  • Implementation of the "Million Solar Roofs Program," with a goal of installing 3,000 megawatts of new solar-electric systems by 2017.

In addition to these and other principal recommendations, the Draft Scoping Plan addresses a number of secondary measures that could be adopted to achieve further GHG emission reductions. The most important of these are the proposed adoption of carbon fees and the potential use of compliance offsets to provide regulated entities with a source of lower-cost emission reductions to meet obligations under traditional regulation, a cap-and-trade program or carbon fee programs. The Plan makes clear CARB's intention to adopt some type of carbon fee program, at a minimum to pay for administration of the AB 32 program in general.

The CARB staff expects to revise the Draft Scoping Plan based on continuing analysis and public input, release a final plan in October 2008 and take the plan to the full Board for consideration at a public meeting in November 2008. Measures in the plan that are adopted by the Board will be further refined over the next three years and are expected to be in place by 2011.