Monday, March 19 , 2018, 7:53 am | Fair 41º


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Business Leaders Air Concerns About Climate Legislation

They fear Assembly Bill 32 doesn't support businesses enough in implementing the environmental standards.

While calling the goals of Assembly Bill 32 laudable, local business leaders worry that its implementation might hurt the California economy.

“We don’t want to make it appear as though the sky is falling; however, based on past legislation, we have seen bills passed that were a good concept but they weren’t well thought out,” said Lisa Rivas of the Regional Legislative Alliance, one of the business advocacy groups in the AB 32 Implementation Group, a business coalition dealing with the legislation.

AB 32, also known as the Global Warming Solutions Act, was signed by Gov. Arnold Schwarzenegger in September 2006 in an effort to combat California’s growing greenhouse gas emissions and send them back down to 1990 levels by 2020. The plan, administered by the California Air Resources Board, is in its scoping stages.

“As it’s currently written, the draft scoping plan is really a blank check for California bureaucrats at this time,” said Shelly Sullivan, a representative from AB 32 IG. The group is pushing for less regulation and more market-based methods.

“We believe that in order to keep costs lower for California businesses and consumers, we’re going to need a broader market that relies on a broad set of offsets as well as a strong cap-and-trade system,” she said. While cap-and-trade is a large component of the plan, it could be better, said the group.

The majority of cost to businesses in California, from large corporations to small ventures, will come in the form of physical changes — retrofitting buildings, changes to equipment, operations, even the number of employees, Sullivan said. The cost of these changes will be passed to the consumers, she added. Some businesses may be forced out of the state.

The ARB also needs to be more specific about how businesses can reach their reductions, Rivas said. She urged a more “realistic” economic analysis.

Among some of the difficulties businesses face is raising the capital to institute greenhouse gas-reducing measures, when much of the technology hasn’t yet been proven cost-effective.

“As far as greenhouse gases, we’re relatively benign,” said Earl McCutcheon of ATK Space Systems in Old Town Goleta. Nevertheless, the tech company is concerned about operating costs that could grow as a result of the mandate. The challenge for them, he said is modifying the building that houses ATK for more energy efficiency.

“We’re housed in a building that’s built to the codes of 1974 and 1975, and to upgrade that costs a lot of money,” he said.

The charges by AB 32 IG are in contrast to reports released Wednesday by the Air Resources Board that claim that the California economy will in fact grow as a result of AB 32.

According to a statement by the ARB, taking on the recommendations outlined in the scoping report would result in a projected increased economic production of $27 billion, as well as increase jobs by more than 100,000.

But the payoff won’t be instant, according to the ARB. There will be initial investments, which “more than pay for themselves over time.” Growing green industry, coupled with innovations in technology will make up for the initial costs, said the board.

“The facts are in,” said Mary Nichols, ARB chairman. “These reports support the conclusion that guiding California toward a clean energy future with reduced dependence on fossil fuels will grow our economy, improve public health, protect the environment and create a more secure future built on clean and sustainable technologies,.”

Though still not finalized, the plan is subject to a variety of opinion, from environmentalists who support the proposed cap-and-trade plan, to business owners leery of increased regulation.

The California ARB is accepting public comment on the draft scoping plan, as well as the analyses of the plan until 5 p.m. Oct. 2 in preparation for the final scoping plan’s release on Oct. 3. An ARB workshop will take place Sept. 26 in Sacramento that will be broadcast live. Click here to view and submit comments.

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