California has emerged as a global leader in the fight against climate change, and on Monday its signature cap-and-trade program, meant to reduce greenhouse emissions, was extended through 2030 after passing through the state Legislature.
Assembly Bill 398 was described by Senate President Kevin de León as the most affordable way to meet the state’s goal of reducing greenhouse gas emissions 40 percent by 2030, compared to levels measured in 1990. Under the complex program, which was previously in place through 2020, refineries, power plants and factories must obtain permits for each ton of greenhouse gases they emit. Millions of permits are given out by the state for free, but they are also sold amongst those in the industry, both privately and at auctions. The permits correspond with a level of overall allowable emissions that is lowered annually.
The bill was met by opposition from both the left and the right, with Republicans complaining that it would drive up prices for gasoline (the existing program raised prices by 11 cents per gallon) as well as home utility bills. According to the nonpartisan Legislative Analysis Office, the renewed cap-and-trade plan will raise gas prices by nearly $1 per gallon.
Assemblyman Adam Gray (D-Merced) adamantly opposed the bill, expressing worry that renewal of the cap-and-trade program would disproportionately impact the poorest Californians, many of whom live in his district.
“If you live and work in the Central Valley, you have a different attitude toward rising fuel and energy costs than our neighbors along the coast,” said Gray.
He described the program as a tax on the working families of Merced, Ceres, Los Banos and communities like them, who live through hotter-than-normal summers and frigid winters while those living on the coast are spared the higher utility bills.
“We cannot, and will not, sit idly by as special interests let political ideology trump good policy. California has promised to be a leader on climate change, but we are leading down a path no one will follow,” he said.
Gray voted “no” on AB 398, as did Senator Anthony Cannella (R-Ceres), who did not respond to a request for comment. Cannella’s fellow local Republican legislators, Assemblyman Heath Flora (R-Ripon) and Senator Tom Berryhill (R-Twain Harte), both voted to pass the measure, however.
Berryhill was the only Republican to vote for the measure in the state Senate, and following the vote told the Sacramento Bee he made the decision after working with the governor to ensure that an extension of the manufacturing tax credit applied to the agriculture industry.
In a statement, Berryhill said the bill was the “unfortunate result of years of aggressive climate-change policies forced on us by the coastal elites who run Sacramento.” Instead of doing nothing, he added, he decided to ensure that the Valley’s working class was protected in the negotiation.
“Cap-and-trade fills a void created by onerous policies, a void that would otherwise be filled by regulations written by out-of-touch, unaccountable bureaucrats – the exact people I came to Sacramento to rein in,” said Berryhill.
He added that the bill also suspends the controversial fire prevention fee, for which there is an annual $117 charge, and keeps gas taxes from increasing by substantially more than $1 per gallon.
“Again, this bill is not perfect, but it is more reasonable after a bipartisan negotiation,” said Berryhill. “I am very pleased to have given farmers, small-business owners and rural Californians a voice in the negotiation of a measure that would have been passed one way or another.”
Another “yes” vote given by a Republican came from Flora, who admitted that although he “hates” the bill, he chose to support it because expiration of the program would have been worse for the Valley.
“What’s worse than cap-and-trade is what happens when it expires; it gets replaced by a draconian system of penalties and mandates known as command-and-control,” said Flora. “That’s something that will absolutely kill jobs in the Central Valley; especially agriculture, energy and manufacturing jobs.’
Those three industries supported the cap-and-trade renewal, which is why Flora had to support the bill, he said.
He added that without the bipartisan negotiations on the bill, many of the same things that Berryhill applauded AB 398 for would not have been possible, like the suspension of the illegal fire tax as well as an amendment allowing for the plan to sunset in 2025.
“These things would not have happened without Republicans,” said Flora.
The renewed cap-and-trade program is expected to be finalized in late August.