AB32 Legislation

In CA, AB32 Legislation at a Crossroads

When the state of California opted to run with a far-reaching climate protection initiative, promising significant reductions of greenhouse gas emissions within state borders, legislators were fairly confident that other jurisdictions would also act aggressively. In concert, such actions would indeed make a significant difference to carbon emissions going forward. However, as is often the problem when looking into a crystal ball, this ideal scenario has not materialized and this has presented a problem for CA, AB32 legislation likely to have to stand alone, with all its consequences.

For the state of CA, AB32 was a groundbreaking initiative when it was proposed in 2006 and indeed as part of the bill's declarations; the state noted that AB32 would encourage "other states, the federal government and other countries to act." Many would argue that the effectiveness of AB32 is indeed dependent on the actions of other jurisdictions, most notably as it proposes a restriction of carbon emissions, but that its effectiveness will be measured according to emissions leakage, should other neighbouring locations be regulation free.

When the state of California opted to run with a far-reaching climate protection initiative, promising significant reductions of greenhouse gas emissions within state borders, legislators were fairly confident that other jurisdictions would also act aggressively. In concert, such actions would indeed make a significant difference to carbon emissions going forward. However, as is often the problem when looking into a crystal ball, this ideal scenario has not materialized and this has presented a problem for CA, AB32 legislation likely to have to stand alone, with all its consequences.

The federal government has been painfully slow to push contentious climate bills through and whereas a nationwide carbon emissions trading scheme was engaged when the House of Representatives passed their own bill, it now looks as if it will be significantly watered down before the Senate will pass its own climate care bill.

As the nations who were party to the Kyoto Protocol noted, greenhouse gas emissions cannot be adequately managed unless and until all jurisdictions have some kind of regulatory policy in place. To date, the largest carbon emissions scheme in existence is the European Union's version. As greenhouse gas emissions are of course a global problem, regional initiatives are all well and good, but not the answer.

CA AB32 and The Need for a Unified Regulatory Program

A unified regulatory program is essential before carbon emissions can be curtailed to a point where they can be reduced by 80% through 2050. If the U.S. Senate does not advocate a cap and trade trading scheme, California may be essentially "going it alone" in the United States and there are many risks for CA; AB32's policies may indeed end up being punitive to the state's economy.

It is possible that the implementation of CA AB32 will cause organizations in the state to seek business locations elsewhere. In this respect, those emissions sources could negate the reductions achieved in California. Those organizations that remain within the state could be at a competitive disadvantage, as other companies could operate restriction free.

How CA, AB32 Can Help Curtail Energy Emissions

Despite considerable opposition in CA, AB32 is likely to go ahead, but there is still room for a relaxation of some of the more onerous limitations to allow flexibility in the timing of emissions reductions through the year 2020, which is the target date set within the legislation.

Organizations should pay particular attention to CA AB32, regardless of their physical location in the country. This law is an indication of the growing call for legislation to curtail energy consumption and consequent carbon emissions and each organization is well advised to implement its own efficiency and monitoring system to put itself ahead of the game.

About Verisae

Verisae helps measure, manage and reduce equipment and energy costs including the related business and environmental impacts of carbon emissions. The Sustainability Resource Planning (“SRP”) software platform improves operational efficiency, protects brand integrity and helps ensure regulatory compliance for distributed enterprises across many industries. Verisae delivers a broad range of sustainability solutions to dozens of clients globally with thousands of daily users including an extended network of third-party suppliers. Verisae’s integrated sustainability platform actively tracks millions of assets across thousands of sites worldwide.

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