What Governor Brown's carbon emissions order means for businesses
Governor Jerry Brown issued an executive order Wednesday, setting a goal for greenhouse gas emissions to be 40 percent below 1990 levels by 2030, what he described as the most ambitious goals in North America.
“Growth, economic strength, and environmental stewardship go together and that’s what we’re moving on,” Brown told a lunchtime gathering of business and finance executives Wednesday at the Milken Global Conference in Beverly Hills.
Brown was long on soaring vision and short on specifics about how his new goal will be achieved. He did say he expects innovation and new technology – like greener cars – to help.
"Forty percent of the electric cars that are bought in America are bought in California," Brown said. "We are projecting millions of not only electric cars, but also combustion cars that are much more efficient, and natural gas and hydrogen."
But economist Kevin Klowden, managing director of the Milken Institute's California Center, said innovation alone won't get the state to its goal; Businesses want incentives to cut carbon emissions, especially the biggest emitters, which are electric companies.
“The real issue is how will it be paid for," said Klowden. "Nobody is going to be able to do this themselves. The state is going to have to lean in.”
Klowden said California is already an expensive place to do business, especially with the state's cap-and-trade program that launched three years AGO, which fines heavy polluters.
“There’s already an additional cost," he said. “We already have more expensive gas partly because of that.”
But Stanley Young, a spokesman for the state's Air Resources Board said the cap-and-trade program also means businesses are already heavily incentivized to cut down on emissions. He said more incentives could be added.
"We will consider a range of options considering the input from all of the stakeholders,” said Young. “We’ll be holding workshops that will lay out new pathways to the new aggressive targets."
Young said the workshops will likely begin in several months.
“We want to get cracking on this," he said.