Saturday, July 23, 2011
California's AB 32 Jobs Still Absent
From my earlier posts on SLB regarding AB 32, California's Global Warming Solutions Act of 2006 (Nunez), it is clear that I hold a dim view of the law, the necessity for the law, the so-called scientific basis for the law, and its effect on the state's economy. This post is an update on the last aspect, the effect on the state's economy. For some perspective, AB 32 has a multitude of components, with more than 70 separate line items in the Scoping Plan. It is generally stated by the media, and even some within the Air Resources Board (ARB or CARB), that AB 32 will not be implemented until January, 2012. That is misleading at the best, and an outright false statement at the worst. AB 32 has a number of line items already in place, in fact, there are "Early Action Items" listed prominently on ARB's website. However, some of the line items will be in force next January, while one rather large piece has been delayed until at least 2013. The big delay is for Cap and Trade. More on that a bit later.
AB 32 was (or is) supposed to change California's emissions of CO2 and a few other so-called "greenhouse gases" by reducing those emissions according to a timetable. The initial reduction and time-target was down to 1990 levels by 2020. This means that, on an absolute tons emitted per year basis, by 2020 California would emit the same amount as was emitted in 1990. In practice, that requires approximately a 30 percent reduction compared to the "business-as-usual" case. CARB uses the abbreviation BAU for business-as-usual. An additional target was then set by the Governor to 80 percent below the 1990 level by the year 2050. Stated another way, California in 2050 can only emit 20 percent of what it emitted in 1990. After allowing for economic growth and population growth, the "80 by 50" requirement actually requires more than a 90 percent reduction in CO2 emissions compared to the BAU for 2050.
As I've written elsewhere on SLB, expecting to achieve this is quite absurd. The "80 by 50" requirement is absolutely a death-knell for California's economy. No economy in modern times (or ancient times, for that matter) has ever demonstrated an ability to conduct commerce, transportation, supply reliable and affordable energy (i.e. electricity), produce agricultural crops, produce and deliver clean water, collect and dispose of waste, and all the other aspects of a large and diverse economy with such a low CO2 output. None. But, CARB and the California government have the utmost faith that it will be done. They have some vague notions that fossil fuel-fired power plants will have the CO2 captured and sequestered, that cars, trucks, and buses will run just fine on bio-fuels or hydrogen or electricity, and a great portion of electricity supply will be from renewable sources such as wind and solar. They have grand plans for each citizen to conserve and reduce electric power consumption by some vague means, and by a "smart grid" that will reduce power consumption even more.
So much for the basics.
All of AB 32's requirements are supposed to be technically feasible, and are touted as creating jobs for California's economy. With January 2012 less than six months away, it is time to look for those jobs. Supposedly, California companies are producing bio-fuels, for example. Solar panels are another big requirement, and the jobs to manufacture and install them. Smart grid components and the installers for them is another item. The list of AB 32 items and the jobs they are supposed to create is long. Yet, the most ridiculous of the jobs-related aspects is what ARB stated in the beginning: each Californian will have approximately $250 per year of extra, disposable income as a result of AB 32. That works out to approximately $5 per week, which is enough to buy a cup of premium coffee each week. The additional sales of coffee will create great numbers of jobs in the retail sector.
The reality is that California is leading the entire nation in unemployment rate - with the sole exception of Nevada. The recent figures for June, 2011 are now public and show California with 11.8 percent. (Nevada is at 12.4 percent). So, the question remains unanswered, where are the AB 32-related jobs in California? Only six months from now, nearly all of the 70-plus line items are to be in place. Will millions of new jobs magically appear on January 1, 2012? Will coffee baristas be in short supply, so that most of the just-graduated teens can find employment? Somehow, that seems rather unlikely.
Roger E. Sowell, Esq.