• Air
• Climate Change
• Environmental

Greenhouse Gas Emission Fees Proposed in California

Beveridge & Diamond, P.C., February 21, 2008

The Bay Area Air Quality Management District (“BAAQMD”) recently proposed to assess greenhouse gas (“GHG”) emission fees on stationary sources. This appears to be the first GHG emission fee in California, and quite probably in the U.S.  BAAQMD will be holding a workshop on its proposed new fee schedule on Monday, February 25, and will be accepting written comments through March 7, 2008.

BAAQMD proposes to assess a fee of $0.042 per metric ton of carbon dioxide equivalent (“CDE”) emissions per year. It proposes to assess this fee on the emissions of 63 different GHGs, far more than the six covered by the Kyoto Protocol and the California Global Warming Solutions Act of 2006 (“AB 32”). The proposed fees are intended to fund BAAQMD’s various GHG-related programs, including:

• the development and maintenance of a regional GHG emission inventory;
• studies to identify and evaluate potential GHG emission control options;
• development of regulatory measures for GHGs at stationary sources; and
• review of GHG-related documents, miscellaneous activities, and coordination with the California Air Resources Board (“CARB”) regarding the implementation of AB 32.

If adopted, these fees will set an important precedent. BAAQMD is an influential agency within California, especially with other air quality management districts and CARB. The timing of this proposed new fee schedule is particularly important, as CARB currently is engaged in developing its AB 32 Scoping Plan. The Draft AB 32 Scoping Plan is due to be issued on June 26, and in it CARB will announce its proposed decisions on numerous controversial issues concerning the implementation of California’s sweeping climate change law. AB 32 granted CARB wide discretion in implementing the law, including whether or not to include any so-called “carbon taxes.” If CARB should follow BAAQMD’s precedent, it would be even more influential.

For a printable PDF of this article, please click here.

For more information, please contact Nicholas W. van Aelstyn, nvanaelstyn@bdlaw.com, or Nicole Leonard, nleonard@bdlaw.com.