Monday, October 25, 2010

23 to suspend 32

The title means that "Proposition 23 is being debated in california State to suspend Assembly Bill 32" !!

What big deal??one may ask

Assembly Bill 32 (AB 32) was enacted in 2006 in the state of California to implement tighter regulations on green house gas emissions and hence more opportunities for renewable energy, incentives for R&D in that sector etc. It had a vision 2020 to reduce GHGs below a certain level. It also mandated 33% of electrical consumption from renewable energy sources.

But now, due to the very high level of unemployment hovering around 12%, a new proposal (Proposition 23) will be voted next week, to suspend AB32 till the unemployment figures reduce below 5.5% for a continuous span of 4 quarters!!

Note: Since 1970, the state of California had only 3 instances of continuous unemployment rate of less than 5.5% for a continuous span of 4 quarters...

This proposal would ensure that California will have lesser regulations on green house gas emissions for the near future. The stricter norms mentioned in AB 32 will remain suspended till the unemployment levels reach the accepted levels.

Before any of these new proposals and debates, California was the leading state in the world other than China in Renewable energy investments and R&D. It has the largest number of wind & solar energy installations in USA and had lot if incentive encouraging even retail consumers to setup solar panels.

But, with these new regulations, the renewable energy industry will take a big hit. Moreover, with USA always looking towards California for renewable energy policies (California state has the highest restrictions on green house gas emissions in USA till date), the country may rethink about its climate bill.

And with USA not inclined towards any climate bill, the state of any further negotiations on climate policies, the future of Kyoto protocol and other issues will remain in doldrums. 

Then, why propose this new proposal 23. The perception is that the fiscal requirement of implementing the restrictions on GHGs is much higher than creating employment. 

Also, the main lobbyists for this proposal would be the oil giants from Texas. For all the renewable energy policies being implemented in California, it still is one of the largest consumer of oil & Gas in USA. So the oil giants are trying tooth and nail to remove any restrictions on petrol consumption in its largest consumer; the result being proposal 23. 

The voting on this proposal is expected in the last week of October or the early November.

Though the recent Oil leak in the US coast remains fresh in US citizens, it is the daily bread and butter which remains a bigger concern to them. Hence I can only pray that the new Proposal 23 will not be voted.

PS: Here is link to the actual proposal....