California Climate Change Law Will Help -- Not Hurt -- State Economy: Study
The state Air Resources Board (ARB) released a study Wednesday examining the economic impact of implementing the California Global Warming Solutions Act of 2006. On top of strengthening the economy, a separate analysis found the laws also will improve public health.
“The facts are in,” ARB Chair Mary Nichols said in a statement. “These reportes 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.”
The legislation, known as AB 32, aims to reduce emissions to 1990 levels by 2020. It includes a greenhouse gas cap-and-trade program, reduced tailpipe emissions and higher performance standards for buildings and appliances.
By 2020, AB 32 will increase state gross product by $4 billion and economic production by $27 billion compared to the business-as-usual scenario. Per capita income will grow by $200, and more than 100,000 jobs will be added to the economy.
The benefits may sound miniscule but the analysis underscores a critical point: reducing greenhouse gas emissions will help, not cripple, the economy.
Some even say the forecast is conservative. For one thing, the analysis only looks at economic factors without considering related environmental impacts that could wreak havoc on the economy, such as flooding, drought or wildfires, said James Fine, an economist and policy scientist with the Environmental Defense Fund.
“It (also) doesn’t represent a lot of the cost savings features that will be available to the regulated community that has been given the opportunity to participate in the cap and trade program,” Fine said.
AB 32 will, in most cases, enhance growth for the majority of business sectors, with the possible exception of the utilities and retail sectors. That’s due to fewer consumer purchases of electric power, natural gas and gasoline. Small business in the state would enjoy a “slight net economic benefit” from spending less on electricity.
Due to AB 32, there will be 300 fewer premature deaths and nearly 9,000 fewer cases of asthma and respiratory problems, according to a separate ARB study.