Post-Prop 23 Era Begins in California

Now, the after-election era begins. California’s victorious AB 32 proponents have a tall order to fill.

These can be summarized as two simultaneous requirements:

A) Create jobs and revive the staggering economy, and

B) Cut CO2 and other named gases to the limits required under AB 32: 28 percent by 2020; then 93 percent by 2050.

AB 32 proponents have staked their reputations, if not all Californian’s livelihoods, on achieving both requirements at the same time. In reality, as the economy weakens and, California experiences contraction instead of growth, the CO2 and other gases may very well revert to 1990 levels by 2020 without much assistance from AB 32. After all, AB 32 requires only a 28 percent reduction by 2020, as stated above. The California work-force is approximately 16 million, and with 1.2 million people out of work, that is 7.5 percent reduction in itself. All that is required, then, is for another 3.6 million people to quit working with the appropriate contraction in the economy. People without jobs will eventually leave the state when the unemployment benefits cease. Companies who cannot make a competitive product or provide a competitive service under AB 32 requirements will leave the state. Federal mandates on vehicle CAFÉ standards will further reduce gasoline consumption, so that the people who remain in California, for whatever reasons, will be forced to drive cars that consume less gasoline – and thus emit far fewer CO2 molecules as they go. However, there is no substitute for reducing emissions – it is a 100 percent reduction – by having a car leave California forever and be parked in a garage in another state.

AB 32 proponents insist that jobs will be created, though, by all the green requirements. Perhaps solar power will be the answer? One solar power plant recently made the news, and the interesting facts are 180 permanent jobs for a power plant rated at 663 MW. With 1.2 million Californians unemployed and requiring a job, they all might find work in solar power plants that produce a combined 4.42 million MW. That’s an awful lot of power, and probably won’t be built anytime soon. The fact is that California consumes only 55,000 MW during peak periods. Even allowing for solar power plants to produce only one-fourth of their rated capacity over time, this does not appear promising. Therefore, we must look elsewhere for the green jobs.

Perhaps car manufacturers will locate their hybrid car assembly plants in California, and produce the tiny cars that achieve 42 miles per gallon, combined city and highway. Perhaps. But, the reality is that even before AB 32’s drastic measures were imposed, car companies shuttered the car assembly plants and relocated them to other states or other countries. Toyota recently shut down the NUMMI plant near San Francisco and moved the assembly work to Texas. So, it looks like there won’t be any cars made in California. Perhaps another segment of the economy will create green jobs?

How about jobs from manufacturing all the ethanol that must be blended into gasoline? The Governor mandated that 40 percent of all such ethanol plants must be built in California. Now, I must inquire, why would a location mandate be necessary, if those plants were such a good investment? Leaving that aside, such a plant can be run with 100 people, counting round-the-clock shift operations, and day workers such as maintenance, management, and clerical staff. It does not appear that ethanol production will soak up the 1.2 million unemployed, as that would produce an awful lot of ethanol. Where else can the green jobs be found?

Perhaps all the cap-and-trade innovators will create a million or more jobs. Maybe, just maybe, renewable solar power can be used to split water and form hydrogen, and that hydrogen can be used instead of ugly, polluting natural gas in the thousands and thousands of applications that presently burn natural gas. That actually would work quite well, but at what price? Also, how many people would be employed in the entire industry?

A cap-and-trade alternative would be to mimic the oxygen-only FutureGen power plants, in which pure oxygen is mixed with the fuel instead of ambient air. The combustion products from burning natural gas with oxygen-only are simply water vapor and CO2, plus minor amounts of SOx and NOx. There is a cost, though, and that cost is high. An air separation plant must be built, and run to produce the oxygen. Neither building the plant, nor running the plant, is cheap. Such plants are also more hazardous because oxygen environments are highly flammable. The stack gases can be scrubbed to remove NOx and SOx, then cooled to condense the water vapor, then all that remains is CO2. The CO2 can then be compressed and liquefied for transport and disposal in an oil well or other sequestration site. Note that the net electric power from the power plant will be reduced to the extent that the air separation plant requires power, and the CO2 capture and sequestration requires power.

Some estimates indicate that one-fourth to one-third of the power generated will be consumed by the air separation plant and CO2 capture and sequestration. If true, that will require that more power plants be constructed and operated just to power those cap-and-trade-mandated systems. Therefore, when replacing aging generating assets, for every 1,000 MW replaced, we must install 1,333 to 1,500 MW. For new installations to meet growing demand, we must also install a similar increased capacity. Power prices must inevitably increase to pay for this.

California’s 2020 population is estimated to be 40 percent greater than in 1990. Domestic energy usage is to be 40 percent less by 2020 per the Scoping Plan. How is this to be accomplished? Use less air conditioning, or an A/C unit that uses only 60 percent of the power? Do less cooking on electric stoves and ovens? By 40 percent? There are 90 meals per month, per person that must be prepared – is Mrs. Homemaker supposed to feed her kids air and water for 36 of those meals? Do not run refrigerators, washers, dryers, dishwashers, heaters, lighting, tv’s, computers, by 40 percent? Or, is more insulation and double-glazed windows supposed to reduce all energy usage by 40 percent? It will indeed be fascinating to watch how the green proponents of AB 32 force the 40 percent reduction to occur.

Simultaneous jobs creation, and CO2 reduction is their mandate under AB 32. We’ll be watching.

Roger E. Sowell, Esq.

Marina del Rey, California