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California has passed and Governor Schwarzenegger has signed a bill knows as AB-32. That was in 2006. Since then, it has become the shining star of climate related legislation even though nothing has yet to be implemented. However, it did help move Fran Pavley from the Assembly, where she was the author of the bill, to the State Senate where she has been named to Chair the Committee on Resources.

So, where are we in the implementation cycle, or what has California accomplished in 2 years? Click Read more! to find out.


To begin with, AB 32 mandated that the Air Resources Board start by putting together a Scoping Plan. This was to be an attempt to tell us all just how things would work and what it would finally cost. That plan is in the final review process. The 2nd and last public hearing on AB 32 will be held on Dec. 11 in Sacramento.

I have two serious concerns. The first is the simple fact that carbon trading schemes will not work, no matter how good the intentions or the goals might be. Schwarzenegger's pick to implement the cap and trade program, Mary Nichols, did similar work when an Assistant Administrator in the Clinton Environmental Protection Agency (EPA). Not only did that fail, she neglected compliance issues at the same time as all attention was focused on the pollution credit scheme.

This post at Climate Progress make the point very effectively.

Q: What is the difference between carbon offsets and mortgage-backed securites?

A: Lipstick.

Carbon offsets and mortgage-backed securities are quite similar in that is impossible for the vast majority of people, even experts, to know what value they have, if any.

Similarly, Cap and Trade mechanisms in the Kyoto Protocol have not worked. It is too easy for major multi-international corporations to circumvent them and at least one organization that is supposed to police compliance has been booted from the job.

Then, in her effort to sell the plan, Nichols has done what they all do; exaggerate the benefits and ignore the rest. Before anyone takes this all seriously, they should read the peer review comments on the economic modeling that the Air Resources Board did to back up their pet project. Even those who are sympathetic to the goals of AB 32 has a hard time believing the case being presented. UCLA Economist Matthew Kahn is one.

In this review, I will highlight why I believe the current modeling exercise underestimates the cost of meeting
AB32’s goals. I will present a research methodology for cheaply collecting the necessary data to test whether the optimistic numbers reported in Table I-2 of
http://www.arb.ca.gov/cc/scopingplan/document/economic_appendix1.pdf could be accurate
estimates of the expected net costs of this regulation.

The first public meeting on the AB 32 scoping plan turned in to a bit of a circus. I would hope that this is a repeat, and that they repeat until someone gets it right. I doubt that Nichols is the one to do it.