But this rapid growth is slowing as Hawaiian Electric Co., Hawaii’s sole power utility, increasingly objects to policies that require it to buy excess power from these homes at rates it sees as overly generous. This report is from last month:

In a filing with the state Public Utilities Commission last month, HECO argued that solar system owners can end up paying nothing to the utility, yet still rely on its grid daily, drawing electricity at night and when clouds pass. That means grid operation and maintenance costs are “increasingly being shifted from those who have solar to those who don’t,” wrote HECO in the filing.

This foreshadows a big battle that lies ahead in California: whether and/or how much residential solar installations should be encouraged with de facto or direct subsidies. So far, according to the utilitydive.com website tracking utility news around the U.S., California’s regulators appear wary of a commitment to any subsidies, not just long-term ones.

‘Costs should be borne by participants’

Last week, the website took an in-depth look at the latest version of the California Public Utilities Commission’s community solar rule, which has been crafted in response to a state law committing California to establishing 600 megawatts of community solar power generation. The first principle of the regulations is sure to spur criticism from politicians and advocacy groups who want California to shift even more quickly than it is away from fossil fuels:

Careful rate design and procurement can create ratepayer indifference and prevent program costs from being shifted to non-participating utility customers. …

The first finding was central for the IOUs [investor-owned utilities]. “Our program adheres to a principle that program costs should be borne by participants,” noted PG&E Community Solar Program Manager Molly Hoyt. “There is no cross-subsidy paid by non-participating customers.”

But in accepting the utilities’ proposals for rates and contract terms, said VoteSolar Western Region Director Susannah Churchill, it is possible the commission compromised affordability.

“I am worried that affordability is going to be a problem and the limitation that customers can only subscribe to the program for a maximum of one year means that they can’t lock in their credits and charges long term,” Churchill explained. “That is going to create uncertainty and may be a big barrier for program uptake.”

While mid-size solar projects remain more expensive than conventional generation, a small premium for renewables makes sense, she said. Many customers will be willing to pay more for 50 percent or 100 percent renewables-generated electricity.

Friendly to solar homeowners — or to state economy?

As state lawmakers gear up for successor laws to 2006’s landmark AB32 energy-regulation law, and as solar panels come down in price, this debate will grow ever more heated. It can be framed as whether alternative-energy policies and laws should be friendly to homeowners doing the right thing for the environment or whether they should be assessed in a cold, bottom-line fashion about their overall impact on energy costs and the economy.

Germany’s experience with its national Energiewende policy, adopted in 2011, holds lessons for California regulators and politicians. This is from a 2013 Reuters story:

Angela Merkel’s “green revolution” risks becoming a victim of its own success.

Seduced by generous subsidies, Germans are embracing the ambitious project with such fervor — installing solar panels on church roofs and converting sewage into heat — that instead of benefiting from a rise in green energy, they are straining under the subsidies’ cost and from surcharges. …

“Germany’s dilemma is how to keep industry’s energy prices low enough to remain competitive and meet ambitious (green) targets while also maintaining a balanced budget,” said Will Pearson, head of global energy at the Eurasia Group in London. “Addressing these will pose a political challenge.”

So attractive are the incentives, or feed-in tariffs, that the rapid expansion of renewable power has driven up the surcharges which fund them and are paid for by consumers. The charge rose by 47 percent this year alone.

Both households and industry are feeling the pain and exporters complain that the energy shift has driven up power prices so much that their competitiveness is being eroded.

This may portend what awaits California in coming years as environmentalists ramp up their push for renewable energy. If the effort leads to broadly higher prices, a reprise of 2010’s Proposition 23 fight is likely. That ballot measure attempted to suspend AB32 until state unemployment was at 5.5 percent of below for 12 consecutive months. It lost 61.5 percent to 38.5 percent after being depicted as an attack on air pollution laws.

The odds of a successor measure passing would seem likely to be much higher if California residents and businesses faced a Germany-sized green-energy price shock. Supporters of the 2010 initiative didn’t only include oil companies and voters who thought California shouldn’t go it alone in trying to reduce the emissions believed to cause global warming. The State Building & Construction Trades Council backed Prop. 23 on the grounds that AB32 would be harmful to the state’s economy.

Shiroma, a Democrat, was an outspoken opponent of 2010’s Proposition 23, which would have suspended AB 32, California’s Global Warming Solutions Act of 2006, until unemployment in the state dropped to 5.5 percent. Shiroma was also Board Chairwoman of the Sacramento Municipal Utilities District.

A 2009 study of AB 32, “Cost of AB 32 on California Small Businesses,” was by two Cal State Sacramento economists, Sanjay B. Varshney and Dennis H. Tootelian. It found that AB 32 would kill 1 million jobs by 2020.

On farming specifically, the study found that small farm businesses would be hit with $498 million in additional costs for AB 32 compliance due to increased prices for fuel, machinery, fertilizer, etc. Farm income would decline by $195 million. Farm workers would lose $101 million in income. And 3,671 jobs at small farms would be killed.

Despite such warnings, Prop. 23 was opposed by then-Gov. Arnold Schwarzenegger, then-gubernatorial candidate Jerry Brown and most of the state’s political establishment.

In her comments at a 2010 Sacramento event, Genevieve Shiroma, also president of the board of directors for the Sacramento Municipal Utilities District, said the utility helps to advance economic development and create jobs through its environmental programs, the Sacramento Press reported in 2010, in “Johnson, SMUD official protest Prop. 23.”

Mayor Kevin Johnson, Shiroma, and other representatives from public agencies and businesses receiving green subsidies said that Prop. 23 would harm the environment, green businesses and air quality.

“AB 32 has provided the vital regulatory certainty needed for venture capital investment, entrepreneurial innovation and market development to prosper in California,” Shiroma said while President of the Board of Directors for SMUD.

If Shirmoa had taken a different position on Prop. 23, it’s doubtful Brown would have re-appointed her as board chair.

After a highly funded demonization campaign, voters roundly rejected AB 23, 62 percent to 38 percent.

Part 1 of the ARLB series, What is the Agricultural Labor Relations Board, can be found here.

Part 2 of the series is background on Shiroma, and can be found here.

By Chris Reed

Here’s how terrible California media coverage of AB 32 has been: Lots of people reading Dan Walters’ column today about the economic toll that it will take are probably surprised.

Remember back in 2010? In covering Prop. 23, which would have blocked AB 32’s implementation until unemployment went down and stayed down, the media simply ignored the same critique that Walters offers in his new column:

“This is a huge experiment in altering Californians’ economy and lifestyles.

“Whether it pans out or not, the short-run costs will be immense.”

This could have been written any time in the last six years. But it only shows up in the Sacramento Bee on the day that AB 32 kicks into high gear. Boy, are we blessed to have the Sacramento media. These guys are the best.

By Katy Grimes

As California voters prepare to square off with several tax increase measures on next Tuesday’s ballot, the fate of California balances on a precarious cliff. But it’s not just the tax increases which could push the state over the cliff… that’s just part one.

Part Deux

The California Air Resources Board is a nefarious beast of a state agency which most people have not even heard of. It is filled with those iniquitous unelected state officials and bureaucrats we hear about, who always remain faceless and nameless. But they are a dangerous bunch.

When the Legislature passed AB 32, California’s Global Warming Solutions Act of 2006, a new era of government control and expansion was ushered in. CARB was given the authority to create strict new environmental controls over every aspect of of the lives of California residents, business and commerce.

As a result of AB 32, CARB was given the authority to create a regulation to reduce passenger car greenhouse gas emissions. But they didn’t stop there.

CARB developed strict diesel regulations; California truckers were forced to purchase new trucks at a cost of $50,000 to $60,000 more; and new passenger auto regulations are about to be ushered in.

CARB went to work developing a cap and trade program. While the rest of the country was shelving cap and trade programs and backing off of selling carbon allowances to businesses because of the drastic national economic downturn, CARB forged ahead recklessly and stubbornly.

California businesses will be forced to purchase carbon credits from CARB in order to keep doing business in California. When all is said and done, it is an environmental tax on business. Even the Legislative Analyst’s Office told the governor that cap and trade is not needed to lower greenhouse gas emissions in California.

Despite pleas from California’s diverse business and industry sector to postpone the auction indefinitely, CARB appears to be determined to conduct the first auction right after the election.

“As part of the California cap-and-trade program, CARB will hold allowance auctions and reserve sales to allow market participants to acquire allowances directly from ARB,” the CARB website says.

CARB plans to conduct the first quarterly carbon auction on November 14.

AB 32 Implementation Group

“We had expectations that at the September California Air Resources Board meeting CARB Chairwoman, Mary Nichols, would recognize that developing a regulation rule change that offered regulated stakeholders 100 percent free allowance allocations would create a win-win situation for the state’s cap-and-trade market program,” the AB 32 Implementation Group reported.

“At that meeting Chairwoman Nichols did not contemplate any changes, except for carving out a few regulated industries while ignoring the pleas of hundreds of others. Conducting the November 14th cap-and-trade auction without the benefit of 100 percent allowance allocations is going to have a grave and destructive effect on California’s regulated businesses, other business that will see and dramatic increase in their operating and energy costs and finally, most importantly, all of California’s consumers.

“Now, our only course of action is to appeal to Governor Brown,” the AB 32 Implementation Group said.

That about sums it up. California businesses are facing the final nail in the coffin should this auction go forth.

Why should we care?

Why should anyone care? The answer will be found in higher prices for everything made, grown and manufactured in California.

The cap and trade program is not about clean air or conserving California’s natural resources. CARB has turned AB 32 implementation into a tax on businesses and consumers. Cap and trade tax will make Gov. Jerry Brown’s Proposition 30 tax increase initiative look like a gift to taxpayers.

There’s a rumor goin’ round…

Rumors are discretely being whispered around the Capitol that Brown may wait until after next Tuesday’s Presidential election to announce that the CARB cap and trade auction is off.

Then again, he may act like Jerry Brown and stubbornly allow it to take place, potentially sealing California’s financial fate, unless a new presidential administration steps in and stops CARB.

Brown is a political survivor and may see the handwriting on the wall should Mitt Romney win the election.

There is a national feeling of loathing toward California because of the ridiculous liberal policies implemented over the last 50 years of Democratic rule in the state. While California used to be a national leader and trend setter, the only trend the state is setting right now is how fast Democratic policies can destroy the economy.

Can Brown be persuaded to to postpone the auction? Californians Against Higher Taxes has a video that should convince everyone, including the governor:

Katy Grimes: Apparently the big news that the amount of carbon dioxide being released into the atmosphere in the United States has fallen to the lowest level in 20 years, hasn’t yet reached the desk of Mary Nichols, the director of the California Air Resources Board.

Nichols is frantically moving ahead with cap-and-trade auctions at breakneck speed, despite that this will create needless, excessive costs for the state’s employers, and seriously prevent businesses from grow. The uncertainty the CARB is causing among employers in the state has dramatically impacted the state’s economy.

“What most people don’t know is that CARB is asking employers to pay for far more emission credits than are needed to reach our goals,” Gino DiCaro with the California Manufacturers Association wrote. “California will reach it’s 1990-level greenhouse gas emissions without the economy-debilitating cap-and-trade auction, but CARB continues to move forward.”

Scientists blindsided

“Many of the world’s leading climate scientists didn’t see the drop coming, in large part because it happened as a result of market forces rather than direct government action against carbon dioxide, a greenhouse gas that traps heat in the atmosphere,” Kevin Begos with the Associated Press wrote this week.

The U.S. Energy Information Agency reported August 1 that energy related U.S. CO2 emissions fell to 1992 levels.

According to Begos, the reason is cheap and plentiful natural gas has led many power plant operators to switch away from using coal. The low price of the plentiful natural gas is a result of shale gas drilling in Texas, Arkansas and Lousiana.

But the most compelling piece of information is that climate scientists didn’t see this drop coming. While they were so busy manipulating data to keep the focus on climate change and global warming alarmists, it was free market forces and not government mandates that led to the lower carbon emissions.

Take that, Mary Nichols. 

The free market still trumps anything the government can do.

Katy Grimes: As part of the campaign against the automobile, California’s air quality management districts are currently advertising that because of the summer heat, the air quality is bad.

Their answer is ‘don’t drive.’

What a great idea.

In the winter, air quality districts advertise that we can’t use our fireplaces.

What’s next–the beloved barbeque?

Sacramento smog

The Sacramento Metropolitan Air Quality Management District has been running radio ads encouraging area residents to ‘spare the air’ .

“On September 16, 2011, at the direction of the Obama Administration, U.S. EPA announced it would move forward to implement the 2008 National Ambient Air Quality Standard for ground-level ozone of 0.075 parts per million (ppm) averaged over 8-hours. This change significantly strengthened the standard by lowering it from the 1997 8-hour standard of 0.08 ppm,” the Sacramento air district explains on its website.

They almost seem giddy about the more severe restrictions–more restrictions always mean more regulations.”The Sacramento region will remain designated as a ‘severe’ nonattainment area for this new federal 8-hour ozone standard.”

The top 10 spare the air tips from the Sacramento air quality people include:

1. Drive less–“Cars are the major source of air pollution in the Sacramento region.” SMAQMD asks, “Can you get to your destination by walking, biking or public transit? If you leave your car at home one day a week, you prevent 55 pounds of pollution each year from being emitted into our air.”

2. Take public transit–“Take transit and let someone else deal with the traffic. Treat yourself to a stress-free commute,” the air district says. Obviously no one at SMAQMD rides Sacramento’s light rail.

3. Carpool or vanpool to work a few days, or even one day a week–“Share a ride. Whether you’re driving to work, the gym, a baseball game or the park, find a carpool partner.” Get in, sit down and shut up.

4. Sign up for Air Alert — “your free air quality e-mail.” They encourage you to send air alerts to family and friends.

5. Refuel in the evening and never top off–“Putting gas into your vehicle releases Volatile Organic Compounds (VOCs) into the air.”

6. Link your trips–“Cold engines pollute up to five times more than warm ones. Postpone errands on a Spare The Air Day.”

7. Telework–“Why commute at all if you can arrange to work from home? You’ll save commute time and expenses,” SMAQMD suggests. Tell this to the contractors, bus drivers, doctors, lawyers, teachers, fire fighters, cops, shop owners, florists, restauranteurs, and even politicians. Teleworking works best for government employees.

8. Avoid consumer spray products–“These aerosol products include hairspray, furniture polish, cooking sprays, bathroom cleaners, air fresheners, antiperspirants, insecticides, and hobby craft sprays.” And since you’ll be staying home on a spare the air day, you won’t need hairspray.

9. It’s ok to barbecue, but don’t use charcoal lighter fluid–“Use an electric starter or chimney briquette starter instead of charcoal lighter fluid. Better yet, replace your charcoal grill with a propane gas grill.”

10. Do your garden chores gasoline-free–“Avoid gas-powered yard tools such as mowers, blowers, edgers and trimmers — switch to electric-powered tools.” I haven’t seen anyone maintain their own lawn and garden for decades. However, it would be politically incorrect to ask the professional yard maintenance engineers to avoid using power yard tools such as mowers and blowers.

Don’t exhale

The only option we are left with on a spare the air day is to stay indoors with the air conditioning off, don’t cook, don’t use the washer, dryer, dishwasher, oven, stove, or BBQ, don’t work, don’t drive anywhere, don’t do any gardening, and don’t style your hair with an electric hairdryer or use hairspray.

Don’t even exhale lest you emit carbon dioxide. And please don’t break wind. There are dangerous gasses in flatulence, which may explain why professional farters are a profession of the past. I’d be willing to bet that the EPA put them out of business.

Scaring kids

The global warming alarmists are even using scare tactics to scare children into complying.

“Poor air quality can affect your health, as well as your pet’s health,” a spare the air children’s publication states.

Another link from the Sacramento air quality district website for children leads to the federal Environmental Protection Agency’s global warming for children website. “The Earth is getting warmer because people are adding heat-trapping gases to the atmosphere, mainly by burning fossil fuels,” the EPA states. “The Earth’s climate has changed before, but this time is different. People are causing these changes, which are bigger and happening faster than any climate changes that modern society has ever seen before.”

One headline on the EPA kids website read, “Scorching summers… Melting glaciers… Stronger storms… The signs of global climate change are all around us.”

Spare me.

July 10, 2012

By John Seiler

A new Field Poll shows Republican Elizabeth Emken badly trailing incumbent Democratic Sen. Dianne Feinstein, 51 percent to 32 percent among likely voters. In the new Top Two system, there are no third party votes Emken could poach to increase her number.

Check out her recent appearance on Fox Business.

The new Field Poll shows that Feinstein, whatever happened in the new Top Two primary system, holds her usual commanding lead over a Republican challenger. And similar 2010 results were garnered by Gov. Jerry Brown and Sen. Barbara Boxer against their Republican proponents.

So, how can Emken win?

In the Fox interview, Emken brings up the usual “talking points”: California spends too much. It shouldn’t get  federal aid. Feinstein hasn’t helped. Etc. Booooooring.

It’s not going to work, any more than similar talking points did for Whitman and Fiorina two years ago. The political climate is a little better this time for Republicans, assuming Romney improves his so far pathetic campaign. This time in California, the risible Republican Arnold Schwarzenegger no longer sits in the governor’s chair enacting far-left policies and driving GOP voters from the state. He’s off somewhere making movies to pay alimony.

But the political climate remains toxic for Republicans.

What Emken needs to do is personalize the campaign against DiFi. I recommended such an approach two years ago to the campaign of Proposition 23, which would have repealed AB 32, the jobs-killing Global Warming Solutions Act of 2006.

The anti-Prop. 23 campaign sure figured out how to win. Look at the image at the right from their campaign. They attacked the oil companies financing Prop. 23 as “Dirty Energy,” demonizing the Texans as being like J.R. Ewing, from the “Dallas” TV show.

In “How Prop. 23 Still Can Win” here on CalWatchDog.com, I recommend, “They need to personalize the campaign — against Arnold.” They didn’t, of course. They lost. Big time.

Personalize it

The Emken campaign needs a tougher camapign against DiFi. First, they need to pick one unpopular issue she’s associated with. Taxes might be the issue. But that’ll be a mess involving the Romney-Obama battle. Because Romney will get wiped out in California no matter what, she should avoid that. And if she gets involved in the anti-Jerry Brown tax increase too much, she’ll just get in the middle of that, eclipsing her own campaign.

But there’s a ready-made outrage: the California High-Speed Rail boondoggle. The Legislature just voted to waste our tax dollars on it. Gov. Jerry Brown is going to sign the waste. And DiFi is a big supporter. She said: “Do I think it’s doable? Yes…. That’s a decision that has to be made.”

This also is a perfect issue for the divisions in the state. To get the votes in the state Senate to pass the Browndoggle, supporters had to pile the pork high in the Bay Area, Feinstein’s home turf. Emken would be lucky to get 10 votes there. So, demonize the Bay Area — divide it from the rest of the state. Play on resentments that Southern California and the inland areas have for the those snooty Marin County elitists.

And although John and Ken have been calling it the Browndoggle, after the spendthrift governor, the Emken campaign should dub it the “Diannedoggle.” It has a nice alliteration to it.

‘Diannedoggle’

This could be an ad:

Headline: “Diannedoggle.”

Animation: The High-Speed Rail train crashing.

Voiceover: “At a time when scarce tax dollars are needed for our schools, Sen. Dianne Feinstein supports wasting that money on a boondoggle train that critics say could cost well over $100 million. It’s the Diannedoggle.”

Video: Picture of hundreds of billions of dollars burning in the train wreckage. Picture of DiFi.

Voiceover: “That’s why it’s being called the Diandoggle: It’s a boondoggle that’s supported by Dianne Feinstein and will benefit her rich Marin County friends.”

Video: Helicopter of massive beach mansions in Marin County.

Voiceover: “With the rest of California picking up the tab through tax increases. This November 6, defeat the bullet train Diannedoggle. Beat Dianne Feinstein. Vote for Elizabeth Emken for U.S. Senate.”

That also should be Emken’s message in all public and TV appearances.

A month ago, I wrote that Emken “looks too nice to be in politics. Politics is a nasty business.” Look at her campaign ad at the top. It reads, “Retire Feinstein!”

It at least should be: “Dump Dianne!!!!” Better: “Dump Dianne!!!! Stop the Diannedoggle!”

Her campaign called me and insisted that she’s “tough enough to win.”

OK. Prove it. Follow my advice.

—————————–

Correction: The original version of this article contained a paragraph that turned out to be incorrect because I heard the video wrong. That paragraph has been cut out. An alert reader pointed it out to us.

— John Seiler

Katy Grimes: The Assembly today passed the controversial Cap and Trade bill,  Assembly Bill 1532, by Assembly Speaker John Perez, D-Los Angeles, which would deposit Cap and Trade carbon credit permit monies into a new Greenhouse Gas Reduction Account, to be managed by the California Air Resources Board.

What a great idea. California is already precariously perched on the edge of a financial cliff – this could be the push that sends the state right over.

AB 1532 would direct the billions of dollars expected to be generated from cap-and-trade auctions in 2012-13, into the new fund. Revenues are expected to exponentially grow in the future, but only if there are any private sector businesses left in the state from which to extort these funds.

“The ARB estimates annual revenue from the auction of
greenhouse gas emission allowances to range from $2 billion to $5 billion in 2013, with that amount increasing to between $17
billion and $67 billion in later years,” the bill analysis states.

The bill would allow the Legislature to direct the appropriation of the funds, with CARB taking charge of the money management.

I think certain legislators see a new checkbook from which to spend.

No one will be spared from this new carbon tax.  As Chicken Little once said, “the sky is falling!”

For some of our more recent stories about Cap and Trade in California, carbon credits, and carbon auctions, click HERE. We have been warning about this.

By Katy Grimes

While the rest of the country shuns carbon trading schemes, California politicians continue to embrace the concept, and are forging ahead with a Cap and Trade carbon trading system. But eight states have dropped out of California’s Western Climate Initiative, leaving many scratching their heads in wonderment, as only California and Quebec are left alone to solve the world’s global warming and climate change issues.

But instead of being a real innovator and helping businesses sincerely lower emissions, California looks as if it is desperately clinging onto the notion that we can lead the rest of the world in controlling climate change, and behaving as a Nation State.

Why Quebec?

Cap and Trade was first concocted by the United Nations as a way to financially benefit from selling carbon offset credits. Vice-President Al Gore was already part of the Intergovernmental Panel on Climate Change, which helped seal the deal in the 1990’s through the Clinton administration’s involvement in the Kyoto Protocol, which mandated that nations reduce or offset carbon emissions.

This scheme must have been irresistible to the California Legislature, which passed AB 32, California’s Global Warming Solutions Act, in 2006. The original plan was to create a giant climate change coalition with other states and provinces from which carbon trading and taxing would emanate. But one by one, states have dropped out, citing the difficult economy and cost to manage such a program.

But not California.

“Linking with Québec is a significant advance in California’s efforts to fight climate change and steer our economy toward a clean energy future,” said CARB Chairman Mary D. Nichols. “Linking provides more options to California businesses and lays the groundwork for other partners to join with us. This sends a strong message to two national governments that now is the time to support innovation, energy efficiency and the development of clean technologies.”

But Quebec is not even a trading partner with California.

Counting the chickens before they are hatched

As part of his 2012-13 state budget, Gov. Jerry Brown made a gigantic assumption that the state will see $1 billion in cap-and-trade revenue. The state Legislative Analyst’s Office warned that this is a dangerous budget gimmick and an unstable calculation.

The California Air Resources Board passed cap-and-trade regulations in 2011 as part of its effort to implement AB 32. The air resources agency was granted authority by AB 32 to develop “market mechanisms” to reduce emissions to 1990 levels by 2020.

To achieve this, CARB developed its Cap and Trade program, and named 300 industries as the polluters, which will be required to buy carbon credits from the state in order to continue doing business in California.

When more closely examined, Cap and Trade appears to be a wealth redistribution program, by imposing a carbon tax on mostly private businesses, as well as utilities. Economists have warned that it will send businesses in California packing for other states.

While CARB continues to insist that Cap and Trade programs have been a smashing success, programs in Europe and the Northeast have failed, resulting in business closures and downsizes, and fewer tax revenues. Spain nearly went bankrupt with its green energy programs, by killing more jobs than it created. Many warn that Cap and Trade has failed every time it has been implemented, especially in the European Union and Japan.

But CARB will have to rely on companies to honestly report their emissions, which undoubtedly will lead to gaming the system, and cheating.

At a recent Assembly hearing on Cap and Trade, Assemblyman Brian Jones tried to put CARB’s role into perspective. But his objections were met with steely resistance from Assembly Democrats.  “It is my perception since I’ve been elected and serving here for 14 months that CARB is a rogue agency” Jones said. “I want to reaffirm and state emphatically that CARB’s authority derives from this Legislature. It doesn’t derive on its own.”

“Your commissioners are not elected by the public or the voters of this state. We are elected by the voters of this state,” Jones continued. “And this Legislature has given over to CARB some authority that I believe CARB has run away with, and I am only hopeful that my colleagues in this committee and the rest of this Legislature will also come to the same conclusion that I’ve come to and soon realize that the authority of CARB comes from this Legislature, and we will start to rein that in and protect the voters and the public interest in this state.”

Global warming and political influence

In February, China ordered its airlines to ignore the 2008 European Union law which imposed a carbon emission tax on all flights traveling to and from the EU.

Moving in opposite directions, China continues to build coal plants, while California continues to enforce strict regulations to limit traditional forms of energy production, and encourage solar, wind along with other environmentally friendly alternatives.

Recent political history helps us understand how Cap and Trade works, and the political influence derived from its programs.

The now-defunct Chicago Climate Exchange, was founded by Chicago Board of Trade chief economist Richard Sandor, former Goldman Sachs & Co. CEO Hank Paulson, and former Vice President Al Gore, and started trading in 2003. The CCX received start-up funding from the Joyce Foundation in 2000 and 2001, during which time then-Senator Barack Obama sat on the board of directors.

The CCX had more than 400 members, which included corporate giants, auto manufacturers, universities, large utilities, and even Amtrack.

The CCX was estimated to make $10 trillion a year, and explains why California politicians continue to pledge support for California’s carbon trading program. But the CCX was closed down because the voluntary participation of its members waned as other carbon registries entered the market. The Climate Action Reserve and American Carbon Registry continue to operate.

Cap and Trade revenue hearing

CARB’s Board of Directors held a hearing last week to discuss the anticipated revenues from upcoming Cap and Trade auctions, and how they planned to spend the windfall monies.

“We are looking for synergy and consensus,” CARB Chairwoman Mary Nichols said at the hearing. Nichols said that in the transportation sector, efforts to capture the synergies have been successful, “which will help to make our state more competitive.”

Nichols reported that CARB does not know how much money will come in from carbon trading auctions, but the CARB Board estimates “several billion dollars each year.”

CARB invited two panels to participate in the hearing, made up of mostly environmentalist stakeholders, with the exception of the California Manufacturers and Technology Association, the lone voice for business.

Assemblywoman Diane Harkey, R-Dana Point, expressed her concerns at the hearing about how the Cap and Trade program will work, and whether the program will actually result in lower greenhouse gas emissions, as mandated by AB 32. Harkey suggested that it may just be a scheme to allow vast sums of money to change hands, with investors eventually getting rich off of market speculation, and with no improvement in the reduction of emissions.

Harkey warned that CARB was entering the sophisticated financial world of derivative markets and hedge derivatives, where investors get involved in betting, trading and profiting on the value of carbon credit shares. She warned that such sophisticated financial dealings should be managed by specialists, and not a state agency tasked with a mission of cleaner air.

Ignoring all warnings

Two years ago, the Christian Science Monitor published a joint investigation with the New England Center for Investigative Reporting, which found that existing carbon trading schemes were just another way to make money. “Carbon offsets are nothing more than the environmental equivalent of financial derivatives: complex, unregulated, unchecked and – in many cases – not worth their price,” the investigation reported.

“They are buying into projects that are never completed, or paying for ones that would have been done anyhow,” the investigation found. “Their purchases are feeding middlemen and promoters seeking profits from green schemes that range from selling protection for existing trees to the promise of planting new ones that never thrive. In some cases, the offsets have consequences that their purchasers never foresaw, such as erecting windmills that force poor people off their farms.”

Instead of heeding the many warnings, California is moving ahead at rapid speed to implement the first Cap and Trade auction in November.

As with most schemes, the catch is in the amount of empathy and guilt the con artist can elicit. Buying carbon offsets may ease eco-guilt, but experts have concluded that it will do absolutely nothing to lower the world’s carbon emissions, particularly as California goes it alone.

By Katy Grimes

Recently, a memo sent out by the California Air Resources Board referred to the industries CARB has identified as polluters as California’s “regulated class.” These polluters are now subject to the heavy-handed rule and regulation of the agency, and must accept the new costs of doing business in California, in the ugly world according to CARB.

This sounds like the Soviet Union, not California.

Junky Science

Currently, thousands of independent truckers and tow-truck drivers are losing their businesses because of the baseless diesel regulations created by CARB. Even after the exposure of the CARB employee with fraudulent credentials, CARB forged ahead with the impossible diesel regulations.

Hien T. Tran, who published the damning data finding that diesel emissions cause premature deaths, was the lead scientist who wrote the report, “Methodology for Estimating Premature Deaths Associated with Long-term Exposures to Fine Airborne Particulate Matter in California, on which the heavy duty truck and bus regulations are based. But, it was revealed that Tran had purchased a mail order Ph.D. from Thornhill University, which is apparently  nothing more than a box in a UPS store in New York City.

CARB’s director, Mary Nichols, knew of the fraud before voting on the controversial regulation.

And it was reported that other board members knew about Tran’s phony credentials, but withheld the information from other board members for nearly a year after the highly controversial vote.  The attorney general at the time, current Gov. Jerry Brown, was also notified, and chose not to take action.

CARB promoted Tran, and gave him a $1,006.00 a month raise.

The world according to CARB

Despite massive credibility problems, fraudulent data and a business-killing agenda driven by massive ego, CARB continues to move ahead with the upcoming cap and trade auction, conveniently postponed from August until after the November election.

CARB is already counting the windfall cap and trade revenue, and making plans on how to spend it. On May 24, CARB will hold a “workshop” about the anticipated revenues from the upcoming cap and trade auction, and how to spend this windfall of money.

The notice from CARB states,

“The first panel will examine how California can effectively invest the auction funds to meet the goals of Assembly Bill 32 (AB 32) including support of long-term, transformative efforts to improve public health and develop a clean energy economy.

“The second panel will discuss what criteria should be prioritized in the development of an investment plan, and why.”

CARB also claims, “The public is invited to share ideas on either or both of these questions at the meeting, or to submit written comments by June 22, 2012.”

But there is a little problem with this. CARB is not accepting any public comments or questions until after the May 24 meeting.  On CARB’s website, the notice for the meeting agenda states, “Submit Comments (available after meeting).”

But as with all public CARB meetings, this isn’t really about “transparency,” or even informing the public. CARB is merely checking the boxes on its honey-do list, in preparation for the thorough bilking of California businesses and taxpayers.

As with most government entities in this state, CARB sort of wants California residents to think it is going through proper channels.

Politics makes strange bedfellows

In March, a lawsuit was filed by the Citizens Climate Lobby and Our Children’s Earth Foundation against the California Air Resources board.  The suit challenges the integrity of the carbon offset system, and states, “If a polluter wants to emit more greenhouse gases than it has been given (by CARB), or bought in allowances, then it can use offsets, for up to 8 percent of its total emissions. AB 32 requires that all reductions be real, additional, quantifiable and enforceable.”

In other words, the Citizens Climate Lobby thinks that CARB is not following AB 32 closely enough, and is just going to get rich instead on carbon credit auctions instead of demanding that residents dramatically reduce carbon emissions.

The lawsuit contends that allowing the purchase of carbon offset credits fails to meet the two statutory requirements of AB 32:

1) Any “greenhouse gas emission reductions achieved are real, permanent, quantifiable, verifiable, and enforceable by the state board”; and

2) Any such “reduction is in addition to any greenhouse gas emission reduction otherwise required by law or regulation, and any other greenhouse gas emission reduction that otherwise would occur.”

A press release about the lawsuit states:

“Offsets, on the other hand, are imaginary commodities based upon guesses about what would have happened in their absence. The suit, filed in the California Superior Court in San Francisco, argues that the offset protocols and regulations violate the statutory standards because they lack a reliable way to distinguish what has happen because of the offset payments versus what would have happened anyway. In addition, the lawsuit claims that many activities that are already ongoing would qualify as offsets under the recently approved regulations.  As a result, the use of these offsets would allow a false accounting of California’s progress in fighting climate change.”

In the memo about the workshop, CARB states, “Strategic investment of auction funds can further the purposes of AB 32 and deliver long-term economic, environmental, and clean energy benefits.” But this statement is without any merit, since California is the first, and now only, state in the country to push climate change laws on its citizens.

CARB has promised its actions will lead to a prosperous new green economy. So far, that has failed to materialize and instead helped to turn California into a national leader in high unemployment.

The rogue state agency has abused its power by levying millions of dollars in disproportionate fines on business owners who have not violated existing laws, or who have committed only minor technical oversights. The agency has already implemented legally questionable policies, which infringe on constitutional rights. And even though the Legislature passed AB 32, many believe it is also unconstitutional.

Californians should fear the state Legislature which implemented a massive, unelected and unaccountable statist bureaucracy, and whose actions have killed businesses and jobs and irreparably hurt the state economy.

Cap and trade is much bigger than anyone realizes. AB 32 legally mandates the government enter our homes, businesses and utilities, and regulate however it wants. AB 32 granted CARB powers unimagined in this country. Implementing Cap and Trade is just CARB dipping its big toe into the water to see how far the agency will be allowed to go.

CARB needs to be stopped. The bureaucracy and potential for control over California citizens makes high-speed rail look like a toy train.