Cap and trade program design options by philippines
The program was phased in, with the final SO 2 cap set at 8. NO x reductions under the ARP are achieved through a program that applies to a subset of coal-fired EGUs and is closer to a traditional, rate-based regulatory system. Since the program began in , the ARP has achieved significant emission reductions. See our annual progress reports for more information on the progress of the ARP. The ARP was the first national cap and trade program in the country and it introduced a system of allowance trading that uses market-based incentives to reduce pollution.
Reducing emissions using a market-based system provides regulated sources with the flexibility to select the most cost-effective approach to reduce emissions, and has proven to be a highly effective way to achieve emission reductions, meet environmental goals, and improve human health. Title IV of the Clean Air Act set a goal of reducing annual SO 2 emissions by 10 million tons below levels by means of a two-phase cap and trade program for fossil fuel-fired power plants:. Reductions in SO 2 emissions are facilitated through a market-based cap and trade system.
The allowance trading system includes low-cost rules of exchange that tailor EPA's administrative role and facilitate allowance trading as a viable compliance strategy for reducing SO 2.
Under this system, EPA sets a cap on overall emissions. SO 2 allowances are then allocated to affected units serving generators greater than 25 megawatts. All new units based on their historic fuel consumption and specific emission rates.
Each allowance permits a unit to emit one ton of SO 2. Sources may choose among several options to reduce emissions. By July 1, , air districts would be required to deploy monitoring systems in the selected locations, with data to be published on the CARB website.
Air districts would also be authorized to require any stationary sources that emit air pollution in, or that materially affects the selected location, to deploy a fence-line monitoring system. Additional locations would be selected to deploy community air monitoring systems on an ongoing basis, by January 1, , and every year thereafter, as appropriate based on the monitoring plan.
The program also includes annual hearings to support continual improvements in implementing the network of community air monitoring systems. AB requires CARB, by October 1, , to prepare a statewide strategy to reduce emissions of toxic air contaminants and criteria pollutants in communities affected by a high cumulative exposure burden.
The bill also requires CARB to develop criteria for such programs. Within one year, air districts that house such locations would need to adopt a community emissions reduction program consistent with the state strategy, and including emissions reduction targets, specific, cost-effective reduction measures, an implementation schedule and enforcement plan.
These programs should include measures for reducing emissions from the contributing sources or categories of sources, including, but not limited to, stationary and mobile sources.
CARB must approve these plans. Ensuring continuous progress towards fulfilling the statewide strategy, every year, CARB is required to select additional locations with high cumulative exposures for participation in the program. The legislation further requires CARB to update the state-wide strategy at least once every five years. CARB is required to consult with environmental justice organizations, affected industry and other stakeholders in preparing the state-wide strategy, including holding at least three public workshops in different parts of the state.
Air districts must similarly consult with CARB, individuals, community-based organizations, affected sources and local government in developing the community emissions reduction program. AB requires air districts that are in nonattainment to adopt an expedited schedule to implement best available retrofit control technology BARCT for existing sources of air pollution that were covered by a market-based control program as of January 1, and where such standards have not been updated within the last decade.
The law offers compliance flexibility in how the standards are met. AB would also enhance consistency of regulatory standards by requiring the state board to establish and maintain a statewide clearinghouse for the technologies used across the state to define the best available control technology for new sources that emit criteria air pollutants , BARCT, and for related technologies for the control of toxic air contaminants. Enforceable by the air district and by CARB, AB increases the maximum criminal and civil penalties and requires affected air districts to prepare annual reports describing actions taken and results.
AB requires CARB to provide grants to community-based organizations for technical assistance and to support community participation. However, the provision of new funding to air districts to establish monitoring systems and develop and implement community emissions reduction programs remains uncertain at best. The law indicates that no reimbursement is required because a local agency has the authority to levy service charges, fees, or assessments. Reimbursement would only be provided if the Commission on State Mandates determines the act contains mandated costs.
This new law establishes core elements of a bold new system that has the potential to rapidly address elevated exposures and improve health outcomes in disadvantaged communities. The program directs new monitoring and emissions control mandates to the communities that need them the most.
The main uncertainty in the plan is the lack of dedicated funding. In order to realize the benefits of this program and truly meet the needs of the disadvantaged communities the law is meant to serve, there must be sufficient and ongoing financial resources.