Vera Pardee, senior attorney in the Center for Biological Diversity’s Climate Law Institute, recently spoke at the Yale School of Forestry & Environmental Studies about the future of climate change regulation on a panel with Dale Bryk, Director of the Energy & Transportation Program and a senior attorney with the Natural Resources Defense Council, and Dan Lashof, Director of NRDC’s Climate Center.
YCELP: What is the future of cap-and-trade as a policy solution in the United States?
VERA PARDEE: We should start with a little bit of background. Cap and trade was an idea intended to integrate market forces into regulations designed to prevent the worst consequences of anthropogenic climate change. Many Republicans had balked at any regulatory scheme for climate change unless market forces were given a primary role through trading schemes. However, when Democrats in the House and Senate introduced cap-and-trade bills in 2010, Republicans quickly changed course and attacked the legislation as overly expensive and supposedly job-killing. So I think it’s interesting to keep that mind. At this point, the unrelenting gridlock in Congress seems to guarantee that not much of anything can be accomplished on the federal level.
Although prognostication is difficult, it is not likely that there will be a federal approach to cap and trade; that does not mean, however, that there won’t be effective regional approaches or state approaches, as NRDC’s Dale Bryk has outlined.
In California, we have AB 32, which is a cap and trade program. California often leads and states often follow where California goes. AB 32 has many smart design elements, but every time legislation includes a trade component rather than just a cap, one introduces the potential for fraud and abuse and, most critically, lack of additionality – that is, are emissions actually reduced somewhere? Although creating a marketplace for emission permits theoretically causes greater efficiency, practically it can create trading bubbles, inequalities, and much lower prices on carbon than should be imposed if the true damages caused by climate changed were taken into account.
In 2009 and 2010, when cap-and-trade was considered in Congress my organization, the Center for Biological Diversity, did not actively support any of those bills – not only because of fear of abuse – as that’s not necessarily an objection that cannot be overcome – but because all but one of them had as its centerpiece the dismantling of all Clean Air Act provisions to reduce greenhouse gases in exchange for this scheme. We said that’s a very bad idea because the Clean Air Act has been an incredibly successful pollution reduction vehicle for 40 years and it definitely should not be sacrificed. We do not, however, oppose new legislation that builds and expands upon the Clean Air Act in positive ways. As it turns out, cap-and-trade did not pass, and at this point most if not all green organizations are on the same page as we are, which is to say that we have to safeguard and protect the Clean Air Act.
YCELP: What do you see as the policy or regulatory mechanisms most likely to provide the largest greenhouse gas reductions?
VERA PARDEE: For myself, I would say a direct, substantial tax on carbon emissions that continues to rise. Such a tax has many advantages. It would be, first of all, a very direct and transparent mechanism. It would generate funds that could be used for renewable fuel development and assistance, and it would provide an effective incentive to avoid the generation of greenhouse gases. And the tax – as was proposed in the Cantwell Bill that was one of the possibilities in 2010 – could result in rebates to consumers, which would also avoid any possibility of ending up with a regressive tax. So a direct tax would be fast; it could be equitably structured; it would be transparent.
After a direct tax I think what we have is the Clean Air Act, and with all its mechanisms it at least holds the promise of being very effective.
Beyond that, I think you absolutely cannot discount the many, many local and regional initiatives – sometimes those aren’t given enough credit. Some people think that if you don’t tackle the largest emissions, you may as well stop, and I think that is incorrect. Stopping greenhouse gases is going to be an effort that requires societal consensus and that will be accomplished by changing people’s minds and then their habits in their daily lives on a local level as well as through nationwide regulation. So I don’t discount those measures at all.
YCELP: Are there other measures or legislation pending that could prove to be a real push forward in reducing greenhouse gas emissions?
VERA PARDEE: Yes, with some qualifications. What has been done with the Clean Air Act is the best thing that has happened so far: the various rulemakings – the endangerment finding, the vehicle rule and then the beginning of greenhouse gas permitting for stationary sources – have been a start. Of course it’s been viciously fought on every level, which is deplorable. My hope, and I think well-founded hope, is that those attacks now being litigated in the federal appellate court in D.C. will fail.
That said, there is so much left to do to enforce the Clean Air Act, and so many steps yet to be taken. I fear the progress that is being made with Clean Air Act regulations may become illusory if the actions that are taken are largely an effort on paper. If you review the permitting that is now going on for stationary sources – the first permits are being issued to try to control greenhouse gases from things like power plants and factories – the permits themselves have been very disappointing because the stepwise analysis of the best-available control technology has been employed to force very few, if any, actions to actually reduce greenhouse gases. Things like switching fuel sources for power plants, which is an obvious, clear remedy to get greenhouse gases reduced, are rejected as a viable option. So it’s great that we now have required permitting that looks at the problem, but if the regulators don’t require action, we really haven’t advanced anything.
So other than the vehicle rules, I don’t really know of any federal law that has yet to make a difference on these issues. The vehicle rules will make a difference over business as usual beginning with the 2012 models, but unfortunately, those rules are by no means tough enough. Even with the rules, we will still lag behind the EU and China, and we will still fail to employ technology available today that could improve the mileage and therefore reduce the emissions of our vehicle fleet.
YCELP: The Center for Biological Diversity identified a way for EPA to address climate change based on water quality impacts under the Clean Water Act. Could you say more about that?
VERA PARDEE: The basic premise is that carbon dioxide released into the air is being absorbed by the ocean in enormous amounts and causes the pH level of the ocean and other bodies of water to become much more acidic, which is extremely dangerous to marine life. The Clean Water Act is mostly known for permitting, but what we have been looking at is the fact that the Clean Water Act requires states to list all bodies of water in their jurisdiction that are impaired. The question, then, is what is impairment? There are laws on the books in many states that define impairment as change in pH level at certain quantifications. If a body of water experiences such a change through human causes, then under these state laws, the waters must be considered impaired. We brought a test case that made the connection between the CWA’s requirement of impairment listings, these state laws, and the demonstrated effect of carbon dioxide on pH levels, and obtained a settlement that raises awareness of this issue and a promise by EPA to begin to look at this relationship. EPA issued a guidance document saying that for the next year, 2012, states should list all of the bodies of water within their jurisdiction as impaired that have suffered a certain change in pH. And once they are on that list under CWA section 303(d), then it becomes necessary to take action to stop the impairment. The acidification effect is not theoretical. It is real, and it has already happened. And the effects on marine life as well as the industries that live off marine life are drastic.
YCELP: Is there any legislation or measures pending that could be a real setback?
VERA PARDEE: EPA can’t act if it doesn’t have any money so the constant attempts to cut back EPA funding are really frightening. We often criticize EPA for not doing enough or not doing it fast enough, but without EPA the ballgame, at present, is really over. Cutting off the EPA’s funding would probably be the worst thing that I can see. Beyond that are the innumerable bills that have passed the House that would undo or delay EPA’s greenhouse gas emission reduction efforts.
YCELP: Is there anything else you’d like to add?
VERA PARDEE: This was mentioned during our panel, but I’d like to reiterate that we need to counteract the idea that regulatory initiatives, or even the government as a whole, are evil. The rhetoric has in many ways become religious and fanatical. And rationality must prevail. We need to change the conversation in the country. The connection between environmental regulation – or just regulation – and the loss of jobs is a pernicious and false connection and must be broken.