Study could weaken underpinnings of suit holding up AB 32
In response to a court order, California regulators say they are working up a “very robust analysis” of alternatives to cap & trade, a critical part of the state’s AB 32 climate law.
Right now, the entire implementation plan is on hold, after environmental justice groups sued the Air Resources Board.
A lower court ruling has forced state officials to reexamine the carbon trading program, on the grounds that alternative ways of controlling emissions were not adequately considered.
The activists’ concern is that a market-based system of emission reductions will create “hot spots” in low-income communities of color as industrial polluters buy the rights (called allowances, or carbon credits) to emit more greenhouse gases, and potentially bring other more toxic forms of pollution into nearby communities.
But will that happen? Since carbon trading won’t start until at least next year, the argument is hypothetical. But another example of emissions trading has been well tested.
In 1990 the nation enacted a similar system of emissions trading for sulfur dioxide and nitrous oxides, pollutants released by power plants and industrial sources that create fine soot particles linked to breathing problems and heart attacks. The main concern at the time was controlling acid rain.
Environmental justice advocates at the time argued low-income communities of color would be harmed by the program. But a study out of Indiana University claims that hasn’t happened.
Author Evan Ringquist of Indiana University’s School of Public and Environmental Affairs examined sulfur dioxide trading activity across the country between 1995 and 2009, to find out where the pollution allowances ended up. Surprisingly, he found that low-income neighborhoods with high percentages of black and Hispanic residents were unharmed by the program. In other words, sulfur dioxide did not concentrate in these communities.
To the contrary, a 10% increase in the percentage of Hispanic households in a zip code was associated with a 4.1% decrease in the likelihood that a facility in the neighborhood would buy permits to emit sulfur dioxide.
“If there is an equity effect from allowance trading in this model, it works to the advantage of communities of color,” Riingquist wrote in the paper, which appears in the academic journal, Social Science Quarterly.
The communities impacted the most were those with high numbers of high school dropouts. It appears that education — but not income or color — was linked to where industrial polluters expanded their operations.
I contacted Ringquist to explain his results. He said he was surprised, too, given how strong opposition had been over “toxic hot spots” in minority communities. But here’s what he found: Older facilities are the ones that tend to buy more sulfur dioxide allowances to meet the requirements of the program.
“Poor and minority residents don’t tend to be concentrated around the oldest sources of sulfur dioxide pollution,” Ringquist wrote in an email.
As for lesser educated communities, a 10% increase in adult residents without a high school diploma was associated with a 5.6% increase in the likelihood that a facility will buy sulfur dioxide allowances. Why?
“It may be that there is less local opposition to purchasing large numbers of pollution allowances,” Ringquist said. Locals could also have less ability to monitor increases in pollution allowances, although he couldn’t say that for certain. “That’s a much tougher story to tell,” Ringquist said.
He also he couldn’t explain why facilities in Hispanic communities tended to sell more allowances, although the data confirms that.
Will California’s carbon trading program be similarly benign to communities of color, counter to environmental justice claims?
If the results of this sulfur dioxide trading study are any indication, California’s cap & trade program may be less harmful than some fear.