Carbon credit value of 393,000 Long Beach trees sinks to zero

Aug. 27, 2012

By Wayne Lusvardi

The value of 393,000 trees in the City of Long Beach in the state’s Cap and Trade pollution credit market dropped from about $1.7 million to zero on Aug. 24.

The reason: the California Legislative Analyst issued a letter saying a Cap and Trade “allowance auction is not necessary to meet the Assembly Bill 32 goal of reducing GHG (Greenhouse Gas) emissions statewide to 1990 levels by 2020.”

The city of Long Beach had been taking steps to determine the feasibility of using its trees to sell air pollution credits in the newly created California carbon market to start in November.

According to the U.S. Forest Service, each tree offsets about 0.09 of a ton of air pollution (4.5 million metric tons of air pollutants divided by 50 million trees = 0.09/ton per year).

Carbon credits are expected to sell for $50/ton in California.  So Long Beach’s 393,000 trees conceivably could generate about $1,768,500 in the state’s carbon market each year (393,000 x 0.09 x $50).

It costs Long Beach about $2.5 million per year to maintain the 93,000 street and park trees located on public property.

With all the hoopla and money spent on preparations to create a trading market in pollution credits in California, it has come down to being not necessary.  The four-page letter issued by the LAO was in response to an inquiry by California State Assemblyman Henry Perea, D-Fresno, who asked, “Is a cap and trade allowance auction necessary? What are the advantages and disadvantages? What are the steps the California legislature would have to take to stop the November auction?”

Political Grandstanding

However, Perea’s letter is pure political grandstanding. The California Air Resources Board had already planned to issue pollution credits at no cost.  It is not necessary to get the state Legislature to enact a bill to reduce the price of pollution credits.

Perea’s letter is just a way for him to appear to be pro-business while his political party is the main force behind California’s Cap and Trade Law in imposing $1 billion in taxes on large industries during a prolonged managed economic depression.

Perea’s duplicitous letter declared,  “Cap and Trade 100 Percent Free Allowance Auction Could Benefit Business and Environment.” With political friends like Assemblyman Perea, who needs enemies?

The whole scheme to impose Cap and Trade taxes is like a Rube Goldberg cartoon contraption.   Beginning in 2014, public utilities such as local municipal water departments and electric companies would also have to start paying pollution taxes or reduce air pollution.  So homeowners in Long Beach would be paying higher water and electricity bills to pay their share of pollution taxes.  But the city’s annual cost to maintain street trees might be greatly reduced by about $10 per housing unit per year ($1.768 million/176,032 housing units in Long Beach).

The California Manufacturers and Technology Association has estimated the higher cost of energy and transportation due to Cap and Trade taxes as $3,400 per average family per year.

As can be plainly seen, Cap and Trade is a taxing system as much as it is a way to reduce air pollution.  However, this question remains: Will imposing Cap and Trade taxes on industries and utilities be worth it if industries flee and those taxes are just passed through to utility ratepayers, consumers and those who commute to work by automobile through higher gasoline prices?


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  1. Ulysses Uhaul
    Ulysses Uhaul 27 August, 2012, 12:09

    Jose has a promising mobile business. He plants ten seedling trees in his yard for offset pollution credits concerning his vile, belching 1976 Plymouth ice cream truck.

    Win Win

    Reply this comment
  2. us citizen
    us citizen 27 August, 2012, 14:38

    SCREW CAlifornia……and I was born here…….Just another damn way of taxing the shit out of us. Yeah, Im getting mad now.

    Im already fighting the smart meters they are installing in our town. Just another way to jack up the rates at certain times of day and know what you are doing in your own home all the time. Talk about big brother.

    Enough is enough. This whole freaking state is the laughing stock of the US. Cap and Trade is a RIP off and there is no proof it will do any good other than getting more money out of you.

    Reply this comment
  3. Ted Steele, Janitor
    Ted Steele, Janitor 27 August, 2012, 16:52

    Please remember that cap n trade was invented or fostered by our god Ronald Rayguns. And respect it.

    Reply this comment
  4. Rex the Wonder Dog!
    Rex the Wonder Dog! 27 August, 2012, 17:07

    Ronnie Raygun did not invent nor foster cap n trade.

    Reply this comment
  5. doug
    doug 27 August, 2012, 17:24

    whats the problem with a 1976 plymouth?
    why do people beat up on 40 year old cars?

    there’s really not that many old cars on the road.

    it probably runs better than my 97 escort that had continual problems 8 years ago.

    keeping a car simple is good common sense.

    Reply this comment
  6. Ulysses Uhaul
    Ulysses Uhaul 27 August, 2012, 17:43

    Who cares sho invented it…

    Bend over you deserve the government you elect.

    Reply this comment
  7. Bob
    Bob 27 August, 2012, 18:17

    Now, now boyz…please, none of this bend over business…I’m trying to watch a colon cleansing pill commercial on the telly.

    Reply this comment
  8. Ulysses Uhaul
    Ulysses Uhaul 27 August, 2012, 18:21

    Try Yoghurt and dates!

    Reply this comment
  9. Ted Steele, Janitor
    Ted Steele, Janitor 27 August, 2012, 20:49

    Poor Poodle—- read and learn about RR and cap and trade little troll—

    Opposition to “cap-and-trade” legislation to reduce global warming pollution is a common refrain among many Republican and a few Democratic officials this fall. The program is derided as a “cap and tax” that would drain voters’ wallets while bankrupting the nation. But ironically enough, the three most recent Republican presidents promoted cap and trade, including Ronald Reagan. They employed such a system to phase out lead in gasoline, cut chlorofluorocarbons and other ozone-depleting chemicals, and reduce sulfur pollution from power plants responsible for acid rain—all without undue cost. Officials who are criticizing it now are doing so for political purposes, and they could likely make it harder to employ cost-effective, market-based policies in the future to significantly lower pollution at an affordable cost.
    For instance, the “Pledge to America: the 2010 Republican Agenda” promises to “oppose attempts to impose a national ‘cap and trade’ energy tax.” After the demise of comprehensive global warming legislation in the Senate, Minority Leader Mitch McConnell (R-KY) gloated that “cap-and-trade, which is also known as the national energy tax, is dead in the United States Senate.”
    Yet many Republican officials greatly admire the father of cap and trade: President Ronald Reagan. Former Gov. Sarah Palin (R-AK) praised Reagan last year:
    When you realize the magnitude of President Reagan’s achievements, there is absolutely no reason why anyone would ignore his ‘demonstrably good’ example.
    Nonetheless, she opposes a global warming plan that would employ the innovative cap-and-trade system first created by President Reagan. Like Palin, many of today’s public officials are repudiating Reagan’s legacy of cap and trade for cheap political gain and to curry favor with the polluting industries that are supporting attacks on those who voted for a cap-and-trade market mechanism to reduce global warming pollution.
    A little history is in order. Cap and trade was developed as a more flexible, market-based system to reduce environmental pollution compared to the so-called “command and control” model employed by environmental laws in the 1970s. The old system required each polluting facility to make a fixed reduction in air or water contamination, which ignored that some facilities could cut pollution more cheaply than others.
    Cap and trade is a cost-effective alternative that allows the firms that can more cheaply reduce their emissions below their required limit to sell any additional reductions to companies that are not able to make reductions as easily. This creates a system that guarantees a set level of overall reductions while rewarding the most efficient companies and ensuring that the cap can be met at the lowest possible cost to the economy.
    The Reagan White House conceived the first cap-and-trade program to reduce pollution. It was used in the 1980s to phase out lead in gasoline at a lower cost. An EPA analysis shows:
    …estimated savings from the lead trading program of approximately 20 percent over alternative programs that did not provide for lead banking, a cost savings of about $250 million per year.
    President Reagan also signed the Montreal Protocol in 1987 to slash the production and use of chemicals that deplete the upper ozone layer essential to screen out cancer-causing ultraviolet rays. His administration established a cap-and-trade system to implement the chemical reductions the protocol required. A 2006 scientific assessment concluded that “the Montreal Protocol is working” to reduce chemicals and protect the ozone layer.

    Reply this comment
  10. Rex the Wonder Dog!
    Rex the Wonder Dog! 28 August, 2012, 00:08

    Wow, Teddy is doing a book long cut and paste job again….sorry sleepy troll but I don’t have all year to read your cut and paste comments…. 🙁

    Reply this comment
  11. Ted Steele, Janitor
    Ted Steele, Janitor 28 August, 2012, 06:50

    Poor Poodle— I guess you have to admit your hero/god Raguns promoted cap n trade! LOL Sorry!

    Reply this comment
  12. Ulysses Uhaul
    Ulysses Uhaul 28 August, 2012, 07:56

    Poodle has nothing of substance to say!

    Reply this comment
  13. Edward Steele, Chief Investigator
    Edward Steele, Chief Investigator 28 August, 2012, 08:56

    U haul— why don’t I see you over at Cal Pensions???

    Reply this comment
  14. Ulysses Uhaul
    Ulysses Uhaul 28 August, 2012, 09:37

    I put my all into CWD….spanking Poodle and Donkey has taken a toll on me-

    I’ll look it over…this Ed guy sounds emotional to me…..not my style dealing with choatic leadership!

    Reply this comment
  15. Edward Steele, Chief Investigator
    Edward Steele, Chief Investigator 28 August, 2012, 10:00

    yes— he does not like me or poodle very much— but the poodle has pushed him to the edge– I feel sorry for any blog where the poodle “does his business”.

    Reply this comment
  16. Edward Steele, Chief Investigator
    Edward Steele, Chief Investigator 28 August, 2012, 10:00

    I will look forward to your comments out there– packing and shipping.

    Reply this comment
  17. Rex the Wonder Dog!
    Rex the Wonder Dog! 28 August, 2012, 10:44

    Teddy, youre not fooling anyone sleepy troll 😉

    Reply this comment
  18. Tom Tanton
    Tom Tanton 28 August, 2012, 11:30

    The VALUE is and always has been zero. The PRICE on the other hand…

    Reply this comment

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