Ontario, Quebec and California sign formal agreement to link their carbon markets

On September 22, Premier Couillard of Quebec hosted Premier Wynne of Ontario and California Governor Jerry Brown in Québec City, where they signed an agreement which formally brings Ontario into the existing joint carbon market of the Western Climate Initiative (WCI).  This comes as no surprise: the government had announced its intention to join the WCR in April 2015 as part of its Climate Change Action Plan.  When Ontario joins up with Quebec and California, effective January 1, 2018,  the carbon market will cover a population of more than 60 million people and about C$4 trillion in GDP. The three governments will harmonize regulations and reporting, while also planning and holding joint auctions of GHG emission allowances.  Text of the Agreement on the Harmonization and Integration of Cap-and-Trade Programs for Reducing Greenhouse Gas Emissions is here.  Here is  an introduction to Ontario’s cap and trade program, which was announced as part of the  For an up-to-date description of the Western Climate Initiative and its importance as a model for sub-national, international co-operation, see   “Will Other States Join California’s International Climate Pact?”  in The Atlantic (August 10  2017).

The Western Climate Initiative Inc. is  based in Sacramento California, and  is now  “a non-profit corporation formed to provide administrative and technical services to support the implementation of state and provincial greenhouse gas emissions trading programs” .

Clean Energy Jobs a pathway to decent work for California’s disadvantaged workers; plus economic benefits of California’s climate policies

Three recent studies from University of California at Berkeley provide evidence of the job benefits of clean energy industries.  The first,“Diversity in California’s Clean Energy Workforce”, from Berkeley’s Center for Labor Research and Education Green Economy Program, claims to be the first quantitative analysis of who is getting into apprentice training programs and jobs on renewables. It states that  “ Joint union-employer apprenticeship programs have helped people of color get training and career-track jobs building California’s clean energy infrastructure”.   The authors attribute this to the recruitment efforts by unions, as well as the location of many renewable power plants in areas where there are high concentrations of disadvantaged communities.  It  presents data for the ethnic, racial and gender composition of enrollment in apprenticeship programs in 16 union locals for electricians, ironworkers and operating engineers. The report finds significant variation in racial and ethnic diversity amongst  unions,with women’s participation minimal, (ranging from 2 – 6%) in all cases. Uniquely, the study also examined the impact of clean energy construction on disadvantaged workers, finding that  43% of entry-level workers live in disadvantaged communities, and 47% live in communities with unemployment rates of at least 13%.  Further, it states:  “Most large-scale renewable energy plants have been built under project labor agreements. These agreements require union wage and benefit standards and provide free training through apprenticeship programs.”

Two other reports were released by the Center for Labor Research and Education, the Center for Law, Energy and the Environment (CLEE) at UC Berkeley Law,  and advocacy group Next 10.   The Economic Impacts of California’s Major Climate Programs on the San Joaquin Valley: Analysis through 2015 and Projections to 2030 (January)   and  The Net Economic Impacts of California’s Major Climate Programs in the Inland Empire: Analysis of 2010-2016 and Beyond  (August)  examine the impact of climate programs on  California’s most environmentally vulnerable regions.  The “Inland Empire” (defined as the counties of San Bernardino and Riverside) report , examined four key policies: cap and trade, the renewables portfolio standard, distributed solar policies and energy efficiency programs.  These policies were found to have brought a net benefit of $9.1 billion in direct economic activity and 41,000 net direct jobs from 2010 to 2016 .  Policy recommendations to continue these benefits:  “reward cleaner transportation in this region; help disburse cap-and-trade auction proceeds in a timely and predictable manner; and create robust transition programs for workers and communities affected by the decline of the Inland Empire’s greenhouse gas-emitting industries, including re-training and job placement programs, bridges to retirement, and regional economic development initiatives.”

The three reports were released to be part of the public debate about extending the cap and trade legislation (passed in July) and about California’s Senate Bill SB100 , which passed 2nd reading in the legislature on September 5.  SB100 would toughen existing targets to  60% renewable electricity by 2030, and  require utilities to plan for 100% renewable electricity by 2045 .

Federal government about to release its proposals for promised national carbon pricing system as California debates radical changes to its cap-and-trade program

In advance of a consultation paper by the federal government, expected to be released in the week of May 15, the Pembina Institute released a Backgrounder report , Putting a price on carbon pollution across Canada . The Pembina report  outlines the current federal and provincial carbon pricing policies in Canada, and makes recommendations for the national benchmark plan promised by 2018. Recommendations  include that any benchmark should at least  provide guidance on treatment of Export Import Trade Exposed sectors and be designed to minimize carbon leakage and competitiveness impacts; and stipulate that cap-and-trade systems must have a cap decline rate in line with a 30% reduction below 2005 levels by 2030. Pembina places emphasis on the need for a 2020 carbon pricing review, as well as frequent carbon pricing and climate policy reviews to ensure that Canada meets its obligations under the Paris Agreement.

A briefer paper on carbon pricing, also released in May, also summarizes the existing provincial carbon pricing plans – but from a right-wing point of view. From the Fraser Institute:   Poor Implementation undermines Carbon Tax efficiency in Canada  .

Also on the topic of carbon pricing, Pembina posted a blog  on May 11 “Time for Premier Brad Wall to focus on carbon price implementation” , in which Nathalie Chalifour, a Professor of Law at University of Ottawa, explains her opinion that the federal government is within its constitutional authority to impose a carbon pricing mechanism on the provinces, despite Saskatchewan Premier Brad Wall`s recently stated opinion to the contrary.

Meanwhile, as reported in the National Observer (May 4) , “California tables new cap-and-trade plan that jumps ahead of Quebec and Ontario” . Quebec and California  have a linked carbon credit market that expires at the end of 2020, and Ontario`s cap and trade plan is schedule to link to the California−Quebec system in 2018.  Continued partnership with California  will demand that those provinces raise their minimum price per tonne of carbon and abolish offsets, among other changes outlined in the  bill currently before the California state Senate . For a full discussion of the proposed legislation, read “California is about to revolutionize climate policy … again” (May 3) in Vox.  Author David Roberts states: ” The changes that SB 775 proposes for the state’s carbon trading program are dramatic — and, to my eyes, amazingly thoughtful. I know some environmental groups have reservations (on which more later), but in my opinion, if it passes in anything close to its current form, it will represent the most important advance in carbon-pricing policy in the US in a decade. Maybe ever.”

Reaction from Canada, California as Trump attacks Obama fuel emissions standards

solar-power-1020194_1920The rest of the world is driving towards new technologies, but U.S. state governments are rolling back EV incentives   and  on March 15,  Donald Trump took the U.S. a further  step away from reducing  transportation emissions.  Following pressure from U.S. auto companies, and in the name of creating American jobs and reviving American manufacturing,  the White House announced that the EPA and the National Highway Traffic Safety Administration (NHTSA) will re-open the evaluation of the  Corporate Average Fuel Economy (CAFE) and greenhouse gas emissions (GHG) standards for light-duty vehicles manufactured in 2022- 2025 .  Never mind that the EPA, in the waning days of the Obama presidency in January 2017, had already issued its official  Determination  to leave the standards in place, stating that they  “are projected to reduce oil consumption by 50 billion gallons and to save U.S. consumers nearly $92 billion in fuel cost over the lifetime of MY2022-2025 vehicles”, with minimal employment impacts.  The New York Times   compiles some of the U.S. reaction to the announcement, quoting Harvard’s Robert Stavins, who states that rolling back the Obama-level regulations would make it  impossible for the United States to meet its obligations under the Paris Agreement.   A sample of  U.S. concerns appear in:   “Trump Fuel economy rollback would kill jobs and cost each car-buyer $1650 per year “ by Joe Romm in  Think Progress ; DeSmog BlogTrump Takes Aim at Fuel Efficiency Requirements, Prompting Concern US Automakers Will Lag on Innovation”   ; and the Detroit Free Press,  reporting on a lead-up Trump speech in Ypsilanti, Michigan ,  “Trump visit puts UAW politics in crosshairs”  http://www.freep.com/story/money/business/2017/03/14/trump-visit-puts-uaw-politics-crosshairs/99165906/    (March 14). The Detroit Free Press  states that autoworkers were bused in to the Trump event by their employers, with Fiat Chrysler and General Motors offering their workers a day’s pay as well.  No immediate reaction to the announcement came from the United Autoworkers union, although  the DFP article states: “UAW President Dennis Williams has repeatedly said he disagrees with Trump on health care, immigration, the environment and most other major issues. But Williams supports Trump’s desire to renegotiate the North American Free Trade Agreement (NAFTA) …..”

In Canada, where Unifor represents autoworkers,  president Jerry Dias spoke out  in “ Auto workers union takes aim at Trump’s examination of fuel standards ” in the Globe and Mail (March 16), and in a CTV News report . He  states that “ he would fight any attempt to roll back environmentally friendly regulations in the auto industry following Trump’s announcement”. Canada’s Minister of Environment and Climate Change was in Washington on March 15th,  meeting with EPA head Scott Pruitt, but her reaction was guarded and diplomatic,  as reported in “As Trump eyes reprieve for gas guzzlers, Canada looks to China  ”  in the National Observer and in “Trump targets fuel-efficiency standards” in the Globe and Mail  (March 16).  Traditionally, Canadian  fuel emissions standards have been harmonized with the U.S. , as a result of the strongly integrated auto industry.  For example, at the end of February, Canada released  its proposed regulations for heavy-duty vehicles, and according to the International Council on Clean Transportation, Canada continued to follow the  U.S. model.  Similarly,  Ontario announced a Memorandum of Understanding on auto manufacturing with the state of  Michigan on March 13, pledging cooperation on regulatory standards as well as technology  and supply chain management.

Harmonization will be more difficult after Trump’s announcement on March 15, just as Canada and Ontario are reviewing their own revisions to fuel emissions regulation . Ontario reacted to the Trump  announcement with a  pledge to continue to cooperate with California and Quebec in the Western Climate Initiative – read “Ontario plans to team up with California against Trump on climate change” in the National Observer (March 16). California won the right to set its own fuel emission standards in the 1970’s, and today, fifteen other states voluntarily follow  California’s tougher standards, including Georgia, Pennsylvania, North Carolina, and the New York metropolitan area – translating into more than 40% of the U.S. population.  “The Coming Clean-Air war between Trump and California” in The Atlantic surveys this  latest conflict between California and the Trump administration .  A press release from Governor Gerry Brown called the fuel standards  announcement  “a cynical ploy” that puts politics ahead of science, and pledged that California will fight it in court.

Renewable Energy legislation in Massachusetts earmarks funds for Just Transition, Environmental Justice

We are used to looking to California for leadership in climate change policy – and the Senate bill SB58, California Renewables Portfolio Standard Program  continues that reputation. Although only in rough draft form as it was introduced in February, it proposes to accelerate the target for sourcing electricity from renewable energy to 50 per cent by 2025, and 100% by 2045.  Inside Climate News has a summary of the renewable energy legislation; for a detailed view of the importance of California as a standard-bearer for climate change action, read “In the Face of a Trump Environmental Rollback, California Stands in Defiance” (Feb. 21) in Yale Environment 360.

Massachusetts is less often recognized for its leadership, despite its commitment in the  Global Warming Solutions Act, 2008 to reduce the state’s greenhouse gas emissions 80 per cent from 1990 levels by 2050 .  In addition,  An Act to transition Massachusetts to 100 per cent renewable energy  (S.1849)  was  introduced into the legislature in January 2017, requiring  the state to achieve 100 percent renewable electricity generation by 2035, and phase out the use of fossil fuels across all sectors, including heating and transportation, by 2050. Advocacy group Environment Massachusetts provides a summary here . The text of the Act   calls for a  Council for Clean Energy Workforce Development, specifying that it include representatives from organized labour, as well as universities and community colleges, renewable energy businesses, occupational training organizations, economic development organizations, community development organizations, and “organizations serving Environmental Justice Populations”.   A Workforce Development Fund would also be authorized, with “At least half of the funds spent from the clean energy workforce development account on an annual basis shall be spent on programs and initiatives that primarily benefit (1) fossil fuel workers displaced in the transition to renewable energy, (2) residents of gateway municipalities …., or (3) residents of areas identified as Environmental Justice Populations under the Environmental Justice Policy of the executive office of energy and environmental affairs. “