WASHINGTON—Call it Bill Richardson’s last green hurrah.
Even though cap-and-trade measures were maligned as poison for the tottering economy during the midterm election cycle, New Mexico’s Democratic governor is finally able to boast that his state has endorsed such a method for slicing global warming pollutants.
Fittingly, it was Election Day when a regulatory body named the New Mexico Environmental Improvement Board voted 4-3 to approve a controversial and relatively aggressive plan to restrict greenhouse gases beginning in 2012. The New Mexico Department of Environment–backed policy requires major polluters such as coal-fired power plants and the oil and gas industry to curb carbon dioxide emissions 2 percent per year until 2020.
But with Republican governor-elect Susana Martinez opposed to the initiative, will Richardson’s joy be short-lived?
It’s hard to say. New Mexico’s Legislature remains a Democratic stronghold but the GOP narrowed that margin of control somewhat in the state House Nov. 2.
“We’re expecting to see legislative efforts to roll back the decision,” Sanders Moore, policy advocate with Environment New Mexico, told SolveClimate News. “We don’t know what it’s going to look like, but the environmental community will be playing a lot of defense on that.”
In the meantime, the conservation-minded are savoring what they interpret as a monumental victory for clean technology in the Land of Enchantment. States are daring to tread, they say, where the U.S. Congress can’t gain its footing.
“This is another example of the states actually treating climate change like the important and serious issue it is,” Shrayas Jatkar, a New Mexico-based organizer with the Sierra Club, explained. “This is how we’re going to make the transition to the clean energy economy. We can be the solar capital of the world, but we need the rules of the road to set that transition in place.”
How the Decision Reverberates in the West
New Mexico can now begin to trade carbon allowances in the nascent Western Climate Initiative. It’s a collaboration among seven U.S. states and four Canadian provinces seeking to reduce emissions 15 percent from 2005 levels by 2020.
In addition to New Mexico, other partners in the Western Climate Initiative include Arizona, California, Montana, Oregon, Utah and Washington, according to the WCI web site. Provinces on board are British Columbia, Manitoba, Ontario and Quebec. Fourteen other jurisdictions in the U.S., Canada and Mexico have observer status.
The state’s Environmental Improvement Board did include a sunset provision if Congress enacts a nationwide cap-and-trade program. In addition, cost containment provisions are part of the package, just in case allowances exceed a certain price tag.
About 63 large industrial sources that emit at least 25,000 metric tons of greenhouse gases a year would participate in the program initially, according to the New Mexico Department of Environment (NMED). State figures reveal that annual greenhouse gas emissions are roughly equal to 24 million metric tons of carbon dioxide.
However, NMED had always made it clear that New Mexico had to have a high enough volume of emissions allowances to be sure trading was cost-effective and efficient.
California Provides Emissions Oomph
By resoundingly rejecting Proposition 23 last week, Californians prevented the dismantling of their landmark legislation to trim heat-trapping gases and convert to a low carbon economy. That green light also gives New Mexico the emissions heft it needs—at least 100 million metric tons—to trigger its policy in tandem with other states and provinces.
In late October, the California Air Resources Board outlined its proposed cap-and-trade plan. By 2015, the program would cover close to 400 million metric tons of greenhouse gases emitted from power plants, factories, refineries and vehicle tailpipes, according to a board report.
The cap-and-trade segment is part of Assembly Bill 32, the California Global Warming Solutions Act, which requires the state to cut carbon emissions to 1990 levels by 2020. It will require 360 businesses to acquire allowances for carbon emissions, although most allowances will be free when the program begins in 2012.
Free allocation of pollution credits to regulated sources is one mechanism New Mexico chose when designing its program because that can contain costs to industry and consumers, according to the Environment Department.
“I'm just really pleased with how thoughtful they were in their deliberations and their consideration of the cost to industry and the consumer as well as the urgency of the matter,” said Sandra Ely, the department’s environment and energy policy coordinator. “Every single board member agreed that climate change is one of most important issues of our time that has to be addressed.”
Governor Elated, Utilities Annoyed