California moves ahead with 'green' economic development agenda

In these trying times, with recession looming, Californians are being called upon to look to their future with bold, far-reaching initiatives to implement the state's Global Warming Solutions Act of 2006. These initiatives amount to a "green" economic development program for California which promises to slash our greenhouse gas emissions, grow our economy through cleaner and more energy-efficient technologies and create jobs. San Diegans can do their part, and share in the benefits.


The Global Warming Solutions Act requires a reduction in the state's greenhouse gas emissions to 1990 levels by 2020, which means a cut of about 15 percent from today's levels, or a cut of about 30 percent from projected levels in 2020 if we do nothing and just continue business as usual. The legislation was a historic step by California that has encouraged action by other states and helped put global warming on the national agenda.

California's Air Resources Board, or ARB, the lead state agency for implementing the act, has prepared a Scoping Plan to provide a detailed strategic framework for limiting emissions and meeting the state's goals for overall reductions by 2020. ARB's plan was released in October, 2008 and will go before the full board for approval in December. Specific regulations for implementing the plan will then be developed. A central component of the plan is a cap-and-trade program to cover 85 percent of the state's greenhouse gas emissions, linked to similar programs and the broader regional trading market for emissions credits being developed by six other Western states and four Canadian provinces.

Other key elements of the plan would require utilities to produce one-third of their electricity from solar, wind or other renewable energy sources, require automakers to sell more fuel-efficient cars, introduce or expand energy-savings programs in important sectors of the economy and set green strategies and standards for manufacturing and for commercial and residential buildings, including promotion of a solar roofs program. ARB's analysis of the net economic benefits of the plan, as compared with doing nothing, projects that by 2020 the plan will:

  • increase California's economic production by $33 billion
  • increase the state's gross product by $7 billion
  • increase overall personal income by $16 billion
  • increase per capita income by $200
  • create more than 100,000 additional jobs These are the official projections, but a recent study by professor Roland-Holst, an economist at the University of California, Berkeley, indicates that ARB's analysis may in fact seriously underestimate the plan's economic benefits because it does not take into account the compounding "ripple" effects on the economy of innovation in energy efficiencies. Professor Roland-Holst's study found that the policies embodied in the ARB plan would, once the compounding effects of innovation are factored in, increase household incomes in California by up to $48 billion, increase the state's gross product by $76 billion and create as many as 400,000 additional jobs by 2020.

    San Diego's part

    The first-ever detailed accounting of greenhouse gas emissions for San Diego County was issued in September by the Energy Policy Initiatives Center, or EPIC, a research center at the University of San Diego School of Law. EPIC's report, funded by the San Diego Foundation, the San Diego Association of Governments, and NRG Energy Inc., provides decision-makers with a baseline inventory of our regional emissions and identifies a score of possible strategies for cutting them to 1990 levels by 2020.

    The report found that the four largest contributors to our total regional emissions are cars and trucks (46 percent), electricity generation (25 percent), natural gas combustion (9 percent) and civil aviation -- mainly interstate flights from Lindbergh Field (5 percent), with the largest local reductions likely to come from better fuel economy standards and development of more large-scale renewable energy sources. San Diego's regional strategies could include reducing vehicle miles traveled as well as our electricity and natural gas consumption, increasing use of large-scale energy co-generation and solar power projects, and capturing more methane gas at our landfills. Officials at the San Diego Association of Governments are expected to release an action plan in early 2009, which will lay out specific strategies.

    Looking ahead

    San Diego is home to world-class universities and research institutions, as well as clusters of leading-edge technology companies, large and small, which provide us with the intellectual capital to develop the transformative, energy-efficient technologies needed for the future. Just as information technology led the last "industrial revolution," so could innovative energy technologies lead the next, and act as a catalyst for our own and the nation's economic growth in the years ahead.

    Kaplan is an international corporate and business law attorney in San Diego. Send comments to All comments are forwarded to the author and may be used as Letters to the Editor.

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