CALmatters’ Julie Cart reports on the December 2018 Air Resources Board hearing, where the Board adopted its flawed post-2020 cap-and-trade regulation without confronting the program’s obvious lack of stringency or even analyzing its sufficiency under state climate law:
Danny Cullenward, an economist with the climate-change think tank Near Zero and a member of the advisory committee, said the air board’s position is based on a math error.
“The analytical integrity of what the staff has put forward does not meet the standard set by state law,” Cullenward said.
[Air Resources Board Chair Mary] Nichols acknowledged Thursday that the issue “sticks in the craw” of those who continue to question whether the board has sufficiently addressed it.
“It hasn’t been put to rest; let’s put it that way,” she said.
Although the Board did not respond to the public comments on this issue at its December meeting, the Board decided to instruct staff to review the issue of allowance oversupply in 2019 and to consider potential adjustments to the market design as needed. No public text of the relevant document (Board Resolution 18-51) is yet available, but I grabbed a printed copy of the draft resolution at the hearing. [January update: the text of Resolution 18-51 is now online and matches the proposed text below.]
Here’s the key instruction from the draft resolution:
BE IT FURTHER RESOLVED that the Board directs the Executive Officer to quantify and report back to the Board, by no later than December 31, 2021, the volume of unused allowances from 2013 through 2020, including volumes held in private accounts, and the potential for unused allowances to hinder the ability of the program to help achieve the SB 32 target. The Executive Officer shall hold a public workshop in 2019 to discuss potential methodologies to evaluate this topic.
This is an important step forward, but it’s worth emphasizing that the evidence of a problem is crystal clear and part of the Board’s own record (see, for example, the nearly 500 pages of analysis Near Zero submitted into the formal 45-day comment period). Despite an extensive formal record, however, the Board refused to analyze the stringency of its post-2020 program caps or even acknowledge independent analysts’ concerns. So while I’m very glad that the Board has agreed to a process for revisiting its questionable analysis, the ARB staff’s willingness to consider facts and evidence will need to improve if this process is to deliver meaningful progress.