Greenhouse Gas Reductions: California Action and the Regional Greenhouse Gas Initiative

Publication Date: April 2007

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Environment

Type:

Coverage: California

Abstract:

In the absence of a federal program requiring greenhouse gas reductions, a growing group of U.S. states are taking action in this arena. Significant actions have been undertaken in California and by a coalition of states from the Northeast and Mid-Atlantic regions.

California has undertaken several initiatives that seek to reduce greenhouse gas emissions. In 2004, the state issued regulations to reduce greenhouse gases from motor vehicles. Eleven other states have formally adopted California's new vehicle requirements. In 2006, California passed two climate change statutes. The first would establish a statewide cap on greenhouse gases. The second would effectively limit the use of coal-generated electricity in California. The state has also taken action to reduce the carbon intensity in its transportation fuels.

The Regional Greenhouse Gas Initiative (RGGI), a partnership of eight Northeast and Mid-Atlantic states, would set up a cap-and-trade system aimed at limiting carbon dioxide emissions from power plants. The cap is scheduled to take effect in January 2009 and cap carbon dioxide emissions at 121 million metric tons through the end of 2014. In 2015, the cap would begin to decrease, so that by 2018, emissions would be capped at 10% below the initial level. Because some observers see RGGI as a possible model for a federal cap-and-trade program, several of RGGI's design elements are generating interest and debate.

Predicting the precise consequences of these state-led climate change actions is difficult. The actions may affect energy markets to some degree by encouraging the use of fewer carbon-intensive fuels. Many observers suggest that the range of state actions will catalyze federal activity. Industry stakeholders are especially concerned that the states will create a patchwork of climate change regulations across the nation. This prospect is causing some industry leaders to call for a federal climate change program. If Congress seeks to establish a federal program, the experiences and lessons learned in the states may be instructive.

The RGGI and climate change activities in California are aggressive, but the resulting emission reductions may be offset by increased emissions in states without such requirements. This is a primary limitation of state climate change programs. Legal challenges to the state actions, particularly those that may affect interstate commerce, represent another obstacle.