Reports: California Climate Law Will Aid Economy, Health

SACRAMENTO, California, September 19, 2008 (ENS) - A first in the country, California's climate change law, AB 32, the Global Warming Solutions Act of 2006, will provide net benefits to the state's economy and also to public health, according to reports issued Thursday by the state agency charged with implementing the law.

The California Air Resources Board Thursday released reports that analyze the economic and public health impacts of the recommended measures in the draft Scoping Plan, the state's policy framework that outlines how California will reduce greenhouse gases 30 percent by 2020, as required under this law.

Central to the draft plan is a cap-and-trade program covering 85 percent of the state's emissions in a regional carbon market of seven states and three Canadian provinces.

The draft plan proposes that utilities produce a third of their energy from renewable sources such as wind, solar and geothermal, and proposes to expand and strengthen existing energy efficiency programs and building and appliance standards.

The economic analysis indicates that the Air Resources Boards strategy will create jobs and save individual households money. And, California will achieve those benefits while enjoying a net benefit in economic growth between now and 2020, compared to the "do-nothing" scenario where California continues to rely heavily on fossil fuels as it does today.

The public health analysis shows that implementing the recommendations to reduce greenhouse gas emissions will build on existing air pollution programs that reduce smog-causing chemicals and toxic soot, providing additional public health and environmental benefits.

"The facts are in," said Air Resources Board Chairman Mary Nichols, introducing the reports.

"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," she said.

The economic analysis compares the recommendations in the draft Scoping Plan to doing nothing and shows that implementing the recommendations will result in:

  • Increased economic production of $27 billion
  • Increased overall gross state product of $4 billion
  • Increased overall personal income by $14 billion
  • Increased per capita income of $200
  • Increased jobs by more than 100,000

The public health analysis shows that programs under the law will improve on existing air pollution cleanup programs.

As a result, in 2020:

  • An estimated 300 premature deaths statewide will be avoided
  • Almost 9,000 incidences of asthma and lower respiratory symptoms will be avoided
  • 53,000 work loss days will be avoided

The recommended approach that was analyzed includes a mix of strategies that combines market-based regulatory approaches, other regulations, voluntary measures, fees, and other policies and programs to reduce greenhouse gas emissions.

The economic analysis used analytical models that measure economy-wide impacts of those policies and measures.

The analysis indicates that most of the economic benefits are the result of investments in energy efficiency that more than pay for themselves over time.

The results in the economic analysis may underestimate many economic benefits since the models do not include lower costs from innovation and improved technologies expected under a market-based program, Nichols said.

The Air Resources Board, a department of the California Environmental Protection Agency, is seeking public comment on both reports. The comments will be considered in the development of the proposed Scoping Plan that will be presented for adoption to the Air Resources Board at its November hearing.

Both reports, with appendices, can be found at

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