Emission Impossible: the Impact of the International Climate Regime

Home , Fran Pavley, Media in Alberta

“I have taken from day one of my office this climate change issue as the most important priority of myself as well as the United Nations as a whole”

Ban Ki-Moon, Secretary-General of the United Nations speech in Kyoto on 29 June 2008 Emission Impossible? The Impact of the International Climate Regime on Sub-National Climate Change Policymaking

Dissertation

Presented in Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy in the Graduate School of The Ohio State University

Amanda M. Rosen, M.A.

Graduate Program in Political Science

The Ohio State University

2009

Dissertation Committee:

Alexander Thompson, Advisor

Randall Schweller

Craig Volden

Amanda M. Rosen

2009

Abstract

Why is there such widespread variation in governmental response to climate change?

While some governments eagerly embrace the Kyoto Protocol and its mandatory greenhouse gas targets, others deny the very existence of the problem and either ignore it or take merely symbolic action. Yet some of the weakest climate policies can be found amongst Kyoto adopters while some of the strongest flourish in those countries, such as the United States that have been the most reluctant to join the international regime. This dissertation explains this phenomenon by examining the process policymakers undergo when confronted with the climate issue. I argue that despite the global collective nature of the climate crisis, policies are chosen based on local conditions and needs.

Governments that are unburdened by top-down mandates on policy are free to experiment with policies that best fit local perceptions and agendas, while governments that must adhere to the Kyoto Protocol and other national commitments have a limited ability to create policies that will be accepted and implemented locally. Those that consider international agreements the best way to tackle climate change should be cautious, as this particular global problem may best be solved by policies generated at the local level.

Dedication

For my Family

iii

Acknowledgements

I have frequently been told throughout my graduate career that ―the best dissertation is a done dissertation.‖ Whether this is true or not is not for me to judge, but I can say without exaggeration that my ability to offer up this work for evaluation of this claim is due to the support of many people. Their unwavering support over the last seven years has kept me going when I doubted that success was achievable.

Thank you to my dissertation committee members Craig Volden and Randy Schweller for all of your advice, guidance, and good-humored responses to my frantic pleas for help.

Particular thanks are due to my chair and advisor Alexander Thompson, for holding marathon sessions reviewing my latest drafts and always having time for me. He gave me the courage to take on a new project in an unfamiliar field, and I would never have finished without his assistance.

Many others provided assistance on this project, acting as a sounding board for new ideas. Chief among them is Andrea Haupt, who never failed to have new and useful insights into my half-formed ideas. Also deserving of thanks are Diana Camella, Jan

Box-Steffensmeier, Tony Mughan, Bear Braumoeller, Frank Wayman, Trevor Thrall,

Elizabeth Smith, Srdjan Vucetic, Amanda Metskas, Danielle Langfield, Christina Xydias,

Autumn Lockwood Payton, Deborah Friedes, and Anand Sokhey. Thank you also to participants at the 2008 ECPR Joint Sessions workshop in Rennes, ―The Politics of

Climate Change,‖ the 2007 Midwest Political Science Association Conference in

Chicago, Il, the 2008 Institute for Qualitative and Multi-Method Research in Tempe,

Arizona, and the 2008 Research in International Politics workshop in Columbus, Ohio.

Additional thanks are due to those who provided generous financial support for this research. Thank you to the Mershon Center for International Security Studies, the

European Consortium for Political Research, and at Ohio State University, the Graduate

School, the Council of Graduate Students, and the Environmental Policy Initiative.

A special thanks to Serena Coppula and Michael Bierschenk for their work as research assistants on the project. Also thank you to the many people around the United States and Canada for giving me their time to answer my questions.

I am very, very lucky to have such a strong support network of friends and family who, unlike me, never doubted my abilities. You know who you are, and I am eternally grateful.

Finally, I would never have made it through this process with my sanity intact were it nor for the unending affection provided by my three sweet, wonderful cats. No mom could ask for more love than that provided by Xena, Pandora, and Draco Rosen.

Vita

1998 ...... East Brunswick High School

2001 ...... Certificate in Contemporary Europe, Syracuse University

2002 ...... B.A. in Political and Economic Studies of Europe,

Duke University

2004 ...... Morris Abrams Award for International Affairs

2005 ...... M.A. in Political Science, Ohio State University

2007 ...... Ohio State University Graduate Associate Teaching Award

2007 ...... Alumni Grant for Graduate Research and Scholarship

2008 ...... Mershon Center for International Security

Studies Graduate Student Grant

2005-present ...... Lecturer and Graduate Teaching Coordinator,

Ohio State University

Fields of Study

Major Field: Political Science

Specialization: International Relations

Table of Contents

Abstract ...... ii

Dedication ...... iii

Acknowledgements ...... iv

Vita ...... vi

List of Tables...... viii

List of Figures ...... ix

Chapter 1. Introduction: Emission Impossible? ...... 1

Chapter 2. Sub-National Climate Change Policymaking Framework ...... 33

Chapter 3. Sub-national Climate Policy in Canada ...... 80

Chapter 4. Sub-national Climate Policy in the United States ...... 122

Chapter 5. Sub-national Policies in Top-Down and Bottom-Up Systems ...... 189

Chapter 6. The Future of Sub-National Climate Change Policymaking ...... 226

Bibliography ...... 237

Appendix A: List of Abbreviations ...... 264

Appendix B: List of Interviews ...... 266

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List of Tables

Table 1.1. Annex B States and Targets ...... 6

Table 2.1. Policy Features of Top-Down and Bottom-Up Policymaking ...... 46

Table 3.1. Alberta Sources of Electricity, 2008 ...... 103

Table 4.1. Climate Change Policies in the States ...... 128

Table 4.2. State Greenhouse Gas Targets ...... 142

Table 4.3. Sources of Employment in California, 2000 and 2005 ...... 156

Table 4.4. Electricity Consumption in California, 2002 ...... 157

Table 4.5 Technical Potential for Clean Energy in California ...... 158

Table 5.1. Provincial Level Emissions, 1990-2006 ...... 217

Table 5.2. State Level Emissions, 1990-2005 ...... 218

Table 5.3. Sub-National Policy Adoption in the United States...... 222

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List of Figures

Figure 1.1. Sub-National Climate Change Policymaking Framework ...... 20

Figure 2.1. Global Emissions of Greenhouse Gases ...... 37

Figure 2.2. Greenhouse Gas Emission Trends in Kyoto Countries...... 39

Figure 2.3. Top-Down Policymaking ...... 42

Figure 2.4. Bottom-Up Policymaking ...... 45

Figure 2.5. Framework of Sub-National Climate Policymaking ...... 61

Figure 2.6. A Typology of Climate Policy Choice ...... 66

Figure 3.1. Top-Down Policymaking in Canada ...... 88

Figure 3.2. Sub-National Climate Policy Choice ...... 90

Figure 4.1. Bottom-Up Policymaking in the United States ...... 131

Figure 4.2. Regional Initiatives on Climate Change ...... 137

Figure 4.3. State Adoptions of California Auto Emission Standards ...... 138

Figure 4.4. State Adoptions of Renewable Portfolio Standards...... 141

Figure 4.5. State Adoptions of Greenhouse Gas Targets ...... 144

Figure 4.6. California‘s Economy, 2006...... 155

Figure 5.1. Overall Emissions in the United States and Canada ...... 213

Figure 5.2. Emissions in California by Sector, 1990-2005 ...... 213

Figure 5.3. Percent Change in Emissions in the United States and Canada,

1990-2007 ...... 215

Figure 5.4. California CO2 Emissions from Fossil Fuel Combustion,

Trends and Projections ...... 221

Chapter 1: Introduction: Emission Impossible?

Climate change is a global problem with serious implications for human life.

Human consumption of fossil fuels has produced concentrations of greenhouse gases in the atmosphere that trap heat on earth, creating a gradual increase in average temperatures around the globe.1 Scientists predict that these warming temperatures will create both mild and severe changes in longstanding climate patterns that for millennia have driven human settlement, agriculture, and lifestyles.2 Notably, higher temperatures will increase the rate of melting in the polar ice caps. As the glaciers melt, sea levels will rise. Low-lying coastal areas--including major cities such as New York and Venice—will be in danger of permanent flooding. Regions of China, India, and Bangladesh among other developing nations will be among the hardest hit, with tens of millions of people under threat of displacement. Mass migrations could ensue, with climate refugees putting enormous pressure on the resources of developed and developing nations alike (Homer-

Dixon 1991).

Other dramatic effects are also anticipated by scientists. Many predict that droughts, floods, and severe storms will be either more frequent, more intense, or both

(IPCC, 2007; National Research Council [NRC], 2002). Changes once expected to be

1 The Intergovernmental Panel on Climate Change (IPCC), National Academy of Sciences, The American Meteorological Society, the American Geophysical Union, and the American Association for the Advancement of Science (AAAS) have all issued statements that the evidence for human-induced climate change is compelling; See Oreskes (2004), Committee on the Science of Climate Change (2001); IPCC (2001); IPCC (2007). 2 See for example IPCC (2007). 1

gradual with a timeline of one hundred years or more may instead become more abrupt.

Rapid changes to the climate could have serious implications for human society and eco- systems with low adaptive capabilities (IPCC, 2007). Certain thresholds or tipping points could be crossed, leading to changes that are difficult to reverse or repair. For example, some scientists warn that the unexpectedly high rate of glacier loss in the Arctic could have a profound effect on the ocean currents that bring warmer water from the Gulf of

Mexico to Europe, causing substantially colder temperatures in parts of the world (NRC,

2002).

Politicians recognize that climate change is not simply an environmental problem, but one that has enormous implications for the global economy and human security3. As a result, climate change has catapulted to the top of the agenda for many policymakers. It is a top priority of the United Nations General Assembly and was the principal topic of discussion at recent G-8 Summits.4 The International Monetary Fund devoted an entire chapter of its 2008 World Economic Outlook to discussing the implications of climate change on the global economy. Regardless of whether scientific predictions of global warming are true or not, climate change is a huge political issue that consumes the attention of policymakers throughout the world.

In this chapter I will introduce the foundations of this research project. I will start by briefly describing the international climate regime and the variation in government responses to global warming. Then I outline the puzzle driving this research and then in

3 On environmental security issues, see Homer-Dixon (1991). The economic consequences are outlined in Stern (2006). 4 Climate change—and the plight of small island nations threatened by resulting sea level rise—is a perennial theme in the General Assembly, and has been made a top priority by Secretary-General Ban Ki- Moon. A special two-day debate on the subject was held in February 2008. See for examplethe UN Dept. of Public Information press release (2008).. 2

the course of finding an answer briefly present a new Sub-national Climate Change

Policymaking Framework and Climate Policy Typology. I next identify gaps in the existing literature that will be filled thanks to this research. Finally, I consider the significance of this project before moving quickly into the theoretical and empirical chapters.

Climate Change: A Global Solution for a Global Problem

The international community has taken up the climate change gauntlet. Climate change exploded onto the political landscape in 1988 thanks to a severe drought, numerous wildfires, and highly-publicized testimony by NASA climate scientist Dr.

James Hansen to the US Senate.5 The United Nations quickly responded, with the World

Meteorological Organization and the United Nations Environmental Programme banding together to create the Intergovernmental Panel on Climate Change (IPCC) later that year.

The IPCC was charged with providing ―the decision-makers and others interested in climate change with an objective source of information about climate change‖ (n.d.).

In 1990, the IPCC released its First Assessment Report and called on the world to adopt a global treaty to address their concerns about the growing climate problem. Later that year, UN Resolution 45/212 initiated the launch of negotiations for what became in

1992 the Framework Convention on Climate Change (UNFCCC). The Convention entered into force in 1994 after achieving almost universal ratification. It called on member states ―to achieve stabilization of greenhouse gas concentrations in the

5 Although I could not find a transcript of his 1988 testimony, Hansen repeats his arguments in ―Warming, Playing Dice, and Berenstain Bears‖ (2000). 3

atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.‖ The FCCC cited three principles that would define how states approached their responsibilities.

―Common but differentiated responsibilities‖ acknowledges that historically, developed countries have contributed more to the problem of climate change than states currently undergoing industrialization. As the main producers of greenhouse gases, these states should bear a larger portion of the burden of finding and implementing solutions for the climate crisis. The Convention also calls on these states—known as Annex I states for the location of their listing in the document—to assist developing countries with their efforts to industrialize in a climate-friendly way.

The ―precautionary‖ principle advocates an approach of acting before it is too late. Although at the time of the Convention there was still a great deal of uncertainty regarding the nature and extent of climate change, the FCCC noted that waiting for more certainty would limit the ability of the international community to act: ―Where there are threats of serious or irreversible damage, lack of full scientific certainty should not be used as a reason for postponing such measures, taking into account that policies and measures to deal with climate change should be cost-effective so as to ensure global benefits at the lowest possible cost.‖ Acting now is in essence an insurance policy against the risks of climate change.

A final principle of the Convention was sustainable development. Noting that economic development must continue, the FCCC advocated an open economic system that would allow for both economic growth as well as solutions to climate change.

With these principles in mind, the FCCC called on member states to reduce their greenhouse gas emissions to 1990 levels by the year 2000. These commitments were not, however, binding. While all countries were required to submit reports regarding their progress in achieving emission reductions, no enforcement mechanism was set up to ensure reductions were taking place. Participants recognized at the time that further agreements would be necessary to create binding emission targets.

Yearly meetings of the members of the FCCC, called the Conference of the

Parties, or COP, began in 1995. The Berlin Mandate of COP-1 called for the creation of binding targets on Annex I states. Two years later, at COP-3 in Kyoto, Japan, negotiations for an international treaty placing binding emission commitments on states culminated in the signing of the Kyoto Protocol to the Framework Convention. The

Protocol called for an overall 6% reduction in worldwide greenhouse gases and assigned individual targets to each industrialized state, now called Annex B countries (again due to the location of their listing; see Table 1.1, below).6 A crucial decision, based on the

―common but differentiated responsibilities‖ principle, was to restrict binding target assignment to these Annex B states. No developing countries—including China and

India—were given binding targets. Largely as a result of this decision, two Annex B states—the United States and Australia—ultimately chose not to ratify the Kyoto

Protocol. Those states that did ratify—including members of the European Union, Japan,

6 The list of Annex I countries is not the same as Annex B states. Original Annex I states included: Australia, Austria, Belarus, Belgium, Bulgaria, Canada, Croatia, Czech Republic, Denmark, European Economic Community, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Latvia, Liechtenstein, Lithuania, Luxembourg, Monaco, Netherlands, New Zealand, Norway, Poland, Portugal, Romania, Russian Federation, Slovakia, Slovenia, Spain, Sweden, Switzerland, Turkey, Ukraine, United Kingdom of Great Britain and Northern Ireland, and the United States of America. 5

and Russia—agreed to maintain an average reduction in emissions equivalent to their target during the commitment period of 2008-2012.

Table 1.1 Annex B States and Targets7 State Emissions Target State Emissions Target Australia +8% Liechtenstein -8% Austria -8% Luxembourg -8% Belgium -8% Monaco -8% Bulgaria -8% Netherlands -8% Canada -6% New Zealand 0% Croatia -5% Norway +1% Czech Republic -8% Poland -6% Denmark -8% Portugal -8% Estonia -8% Romania -8% European Community8 -8% Russian Federation 0% Finland -8% Slovakia -8% France -8% Slovenia -8% Germany -8% Spain -8% Greece -8% Sweden -8% Hungary -6% Switzerland -8% Iceland +10% Ukraine 0% Italy -8% United Kingdom -8% Japan -6% United States -7% Latvia -8%

Members of the Framework Convention continued to meet at the annual COPs to flesh out details of the Kyoto Protocol. In November 1998 at COP-4 in Buenos Aires, the parties adopted a two year Plan of Action to devise the mechanisms that would be used to implement the Accord (Fletcher, 2005). Meetings in Berlin in 1998 and The Hague in

7 Emission targets are a percentage given the baseline year of 1990. States with a negative percentage are expected to reduce their total greenhouse gas emissions by on average x% based on emission levels in 1990, and maintain those reductions during the 2008-2012 commitment period. Those states with a positive percentage are allowed to increase their emissions by the specified amount. 8 The European Community (later Union) was given a collective target of -8% which applied to each member state. However, the EU was allowed to ‗bundle‘ its target and redistribute it to the individual states. While the collective Union must achieve an 8% reduction, some members (such as Germany and the United Kingdom) adopted more stringent targets, while others—such as Ireland—were allowed to increase their emissions. 6

2000 established some technical details, but it was not until COP-6 in Bonn in July 2001 that the parties agreed on the implementation mechanisms.9 These included the three

―flexibility‖ mechanisms: emissions trading, which would establish permits for emitting carbon that could be sold by over-achievers to those companies that exceeded their permits; Joint Implementation, which allows a country to earn emission reduction credits for projects they fund in other Annex B countries; and the Clean Development

Mechanism (CDM), which grants countries credits for emission reduction projects in developing countries (UNFCCC, n.d.). The members also approved of credits for carbon sinks at the Bonn meeting, as well as a financing regime. They deferred discussion of compliance until COP-7 at Marrakech. The operational rules adopted at that meeting in

2001 established the ―rule book‖ of the Kyoto Protocol, known later as the Marrakech

Accords. Subsequent conferences of the parties worked on technical details until by

COP-11 in Montreal in 2005 the parties moved past specific Kyoto mechanisms and began discussing long-term cooperation and a post-Kyoto regime, a subject that has dominated more recent COPs (Justus & Fletcher, 2006).

It is clear that states have attempted to solve climate change by establishing an international regime to coordinate action. To meet their commitments, however, they have adopted a variety of methods and policies. These include multilateral efforts as well as a wide range of domestic policies.

One such effort involves working with transnational networks (Betsill and

Bukeley 2004; Andonova, Betsill and Bulkeley 2007). The International Council for

9 Prior to this meeting, the United States had dominated the discussions, arguing in favor of using carbon sinks to meet emission reduction targets and various flexibility mechanisms. By July 2001, George W. Bush had taken over the Presidency and indicated that the United States would not ratify Kyoto; consequently, the U.S. delegation acted as observers in Bonn. 7

Local Environmental Initiatives (ICLEI; 2008) sponsors the Cities for Climate Protection program, a group of more than 700 municipalities who have vowed to reduce their climate emissions by 10%. The Climate Group is an international non-profit dedicated to promoting leadership on climate change evaluates policy programs around the world in an attempt to share best practices (2008). Other groups such as the International

Emissions Trading Association, the World Business Council for Sustainable

Development, and Greenpeace International foster world-wide attempts to address global warming.

Regional initiatives are another popular multilateral response. The European

Union has taken an aggressive stance on climate change by adopting a Union-wide target of 20% greenhouse gas reductions by the year 2020 (European Commission, 2007). The

Conference of the New England Governors and Eastern Canadian Premiers (NEG/ECP) has created a coalition on climate change which includes the adoption of a climate action plan in 2001 (Selin and VanDeveer 2005). Inside the United States, the Regional

Greenhouse Gas Initiative (RGGI, n.d.) has developed a cap-and-trade program in the northeast region while the Western Governor‘s Initiative and the Southwestern

Governor‘s Initiative are cooperating on climate change in the western half of the country.

Domestic policies also vary widely. Many climate-conscious actors, following the lead of the Kyoto Protocol, adopt some form of greenhouse gas targets. Others focus their attention on expanding research and development of renewable technologies in order to replace the fossil fuels that generate greenhouse gases. New policies are created regulating automobile emissions, establishing carbon taxes, or capping emissions and 8

requiring businesses to trade the right to produce carbon on an open market. Meanwhile, some governments continue to doubt the existence and causes of climate change and ignore the issue entirely or pass symbolic policies that do little to reduce emissions.

The Puzzle

Why is there such widespread variation in government responses to climate change? Certainty over the existence and nature of climate change has grown tremendously over the last decade. International agreements like the Kyoto Protocol point the way forward for all states. Yet convergence on policy—both in its creation and its form—remains elusive. Of particular interest is the widespread activity at the sub- national level: the impact that an individual city or province could have on total emissions, even through very aggressive policies, is miniscule. Yet while some actors do nothing, many have taken on the mantle of climate leaders, adopting costly policies in spite of their negligible impact on global emissions. The United States, for example, contains some of the world‘s most aggressive leaders in climate policy—California; New

Jersey—as well as sluggish laggards like Mississippi and Louisiana. Likewise, Canada— a country that ratified the Kyoto Protocol but is unlikely to meet its commitments— contains both climate-conscious Quebec and skeptic Alberta.10 In other cases, countries that claim to care about climate change and back up those claims through the ratification of the Kyoto Protocol, are failing to adopt strong policies that could have an effect on

10 In 2006 the government acknowledged that Canada was unlikely to meet its obligations; in 2007, new Environment Minister John Baird announced that Canada would not continue to try to meet its Kyoto target. 9

global climate change and are in danger of not meeting their Kyoto commitments

(―Canada Backs,‖ 2006; United Nations Development Programme [UNDP], 2007).

This behavior by governments—where sub-national actors in non-Kyoto member states are stepping up with aggressive climate policies in the absence of top-down pressure-- is puzzling for three reasons.

Governments and Markets: The first puzzle arises from our expectations regarding government attempts to address market failure. A market is in failure when the allocation of goods and services is not efficient, frequently resulting in monopolies, externalities, or the non-provision of public goods (Bator 1958). Historically, one of the purposes of government is to correct these market failures with regulation or other policies to correct the failure and produce an outcome with higher social welfare.

A stable climate devoid of dramatic climate change is clearly a public good. It is both non-rival, in that one person‘s enjoyment of a stable climate does not preclude another‘s, as well as non-exclusive, as no one can be barred from benefiting from the stable climate once it is provided (Olson 1965). We would expect the highest levels of government to provide this public good at the aggregate level. Since local governments are incapable of providing the public good on their own, they are expected to focus on their parochial interests and free-ride on the efforts of others. It is puzzling, therefore, that quite the reverse is happening: in the United States and until recently Australia, the national governments have largely ignored climate change while states and cities take aggressive action to combat the problem. These actions run counter to our expectations regarding how governments behave toward market failures. 10

Tragedy of the Commons: Garrett Hardin‘s (1968) ―tragedy of the commons‖ warns that people, left to their own devices, are likely to abuse common property to secure their own economic well-being. Rational beings, he argues, will continue to overuse the commons even though the net result is negative for society and, in the event of severe overuse and the eventual destruction of the property, themselves. While Hardin focuses on pastureland, oceans, and national parks, the atmosphere and the earth‘s climate are clearly susceptible to this problem. Economic advantage in the modern economy requires the production of fossil fuels which pollute the atmosphere. Self-interested actors—businesses, governments, individuals—have incentives to pursue cheap sources of energy that will keep costs low and produce higher profits. The current cheap sources also have the highest rates of atmospheric pollution—but since the effects of the pollution are distributed amongst all users, each individual actor has an incentive to engage in high rates of energy use. Limiting the use of dirty energy (either through switching to cleaner but more costly sources or simply lowering production levels) results in lower individual benefits in the form of reduced profits. Society benefits, but so do economic competitors.

This is highly pronounced in the case of climate change. Actors must choose whether to reduce emissions, the economically costly option, or continue business-as- usual, which allows actors to remain competitive but contributes to the destruction of the global atmospheric commons. Competitors in this case include not only other businesses, but also entire countries. Developing states such as China and India, unbound by the

Kyoto Protocol, continue to use the commons based on individual self-interest. More industrialized states should be wary of hurting their own economic prospects in the name

of protecting a commons that will continue to be abused by states experiencing massive economic growth.

Yet, as we have seen, governments are limiting their (ab)use of the climate commons anyway, defying expectations. Indeed, many governments are actively trying to prevent a ‗tragedy‘ from occurring in this particular commons. This is not all together surprising. Most scholars of the commons agree that a potential solution to the tragedy is the creation of a Leviathan to manage the commons (Hardin 1968; Ophuls 1973; Ostrom

1990). While the United Nations in many ways does not resemble a central authority figure, it attempted to fill this role on the climate issue via the creation of the IPCC and the Framework Convention. The UN attempts to govern the commons through the creation of an international regime on the emissions of greenhouse gases. The other solution discussed, privatization, also appears in the climate regime. To fulfill the Kyoto

Protocol‘s binding commitments, the European Union created a tradable permit system allowing participants to trade carbon permits on an open market.

The second puzzle rests not in the quick movement of the United Nations to address climate change, but that sub-national governments not bound by Kyoto are taking it upon themselves to govern this commons themselves. Our individual shepherds should not be voluntarily restricting their own herds, particularly when the government is stepping in to provide regulation. Ostrom (1990) argues that the individual participants can manage the commons on their own if the players collectively adopt a binding contract, but that is clearly not the case here either: these governments are acting independently and unilaterally. Certainly some collective action exists in the form of regional agreements, but the vast majority of action is being produced at the city and state 12

level, not at the collective regional level. Rather than free-riding on the efforts of their peers, or responding solely to central authority directives, increasing numbers of sub- national governments are lining up to independently take on ever-greater regulation.

Collective Action: The third puzzle rests in our assumptions about the collective action problem. As Olson (1965) points out, it is more difficult to get larger groups of actors to engage in the provision of collective goods because each individual actor has incentives to free ride on the efforts of others. These individual actors are unlikely to bear the costs of providing the good—in this case, a stable climate—out of fear that others will pay no costs but benefit from the good anyway. Thus, we would expect higher levels of government to provide the good and lower levels of government to ignore it. Each individual state, province, or city produces an insignificant percentage of the global production of greenhouse gases. Thus, the most aggressive efforts by provinces and cities will have very small effects on mitigating global climate change and therefore there are few incentives for these governments to act.

The climate issue poses a further challenge to would-be public good providers: no single government can step in and simply pay the costs to provide the good. Even if the highest polluting governments (the United States and China) dramatically cut back their emissions, fifty percent of the world‘s greenhouse gas production would still be unregulated. Thus a wealthy actor cannot simply provide the good by themselves but must act collectively with others. This requirement should make actors wary of committing themselves to costly reductions without guarantees that neighbors and competitors are acting similarly. 13

We would therefore not expect states and cities to be engaging in costly action in such a situation without national incentives. Indeed, federal legislation is often designed to provide such incentives to encourage state governments to act in the collective interest.

Yet local governments are clearly flouting the conventional wisdom on collective action.

As discussed above, the national governments of the United States and Australia virtually ignored climate change, while many sub-national governments in these countries increasingly passed costly policies to reduce greenhouse gas emissions. These sub- national governments adopted the standards and commitments of an international treaty that neither they nor their parent governments signed onto. Given the expectations posed by the collective action problem, the willingness of US states and cities to adopt climate policies when they have no federal or international mandate and when their actions will have miniscule effects on global emissions is therefore another puzzle this research seeks to address.

Sub-national Climate Change Policymaking: A Framework

Governments interested in solving climate change face two goals that are sometimes in conflict. The first goal is to successfully solve global warming; that is, to ensure that the concentration of greenhouse gases in the atmosphere does not exceed 500 parts per million (Frankel, 2009). Numerous policy options are available to governments interested in this goal, ranging from regulating emission from fossil fuel-producing industries, to eliminating the use of coal and oil from the economy, to basing land use designs on reducing automobile miles traveled to energy efficiency measures.

The second goal is that states want to fulfill their specific treaty obligations under the Kyoto Protocol, and this can limit the policy options available to governments. States committed to the Kyoto Protocol must achieve a certain amount of emission reductions by the 2008-2012 commitment period. These countries are therefore likely to limit the policies they adopt to meet the first goal according to the limits of the treaty—after all, most states only ratify treaties with which they intend to comply (Chayes & Chayes

1993). This can create conflict when policies that achieve the second goal do not actually achieve the first. Scientists and environmentalists note that the low demands of the Kyoto targets will not achieve the reductions required to prevent global warming (UNDP, 2007).

For example, states like Portugal, Russia, and Greece were given targets allowing them to increase their emissions over existing levels. They can therefore meet their Kyoto commitments without decreasing emissions at all, even though that would seem to be required in order to achieve the first goal.

States in a top-down policymaking system are bound by the Kyoto Protocol and must find some way to reconcile their two goals. The Protocol, however, presents two particular challenges to those members wishing to do so. First, it promotes short-sighted answers to a long-term problem. According to the 1997 treaty, states are required to maintain a specified level of emission reductions for the commitment period of 2008-

2012. However, the Kyoto Protocol did not receive its last required ratification (from

Russia) until 2002 and did not go into effect until 2005. States that hesitated on policy adoption, waiting to see if the treaty would ever come into effect, had three short years

(or six, if you assume that the Russian ratification spurred action) to achieve their reductions before the start of the commitment period. Even those states that diligently 15

pursued reductions from the initial signing date had only ten years to work with. This left some options for emission reductions completely off the table, such as building new nuclear power plants or switching to renewable energies such as solar or wind power (for which the technology to do so on a massive scale was not available). Members had strong incentives to pick the low-hanging fruit and adopt easy, low-cost, short-term policies that would allow them to achieve their Kyoto reductions but did not lay the ground work for the long-term action needed to actual reduce global warming.

Second, the international regime limits the ability of politicians to sell their policies as ones that address local needs and concerns. Rabe (2004) argues that in states where public concern with climate change is low, policy entrepreneurs can pursue

―stealth‖ policies, which on the surface address energy needs but also have an impact on climate change. This is not an option in Kyoto states. Bound by their Kyoto obligations, politicians at the national and sub-national level cannot disguise the motivations behind their policies. This is fine in countries where climate change is a universally accepted problem and the public interest rests in combating its causes and effects, but there is still a great deal of skepticism about global warming in some parts of the world. In these places, policymakers concerned about their own electoral prospects will be wary of introducing high-cost climate policies designed to meet international demands. These actors will find it difficult to mask their actions as trying to meet concerns about energy security or the economy, as they must adhere to commitments made by the national government to the international regime. Such actors, if they are unable to bring the public on board, are likely to adopt weaker, ―no regrets‖ type policies that will show

commitment to national and international actors without alienating a climate-skeptic public.

States that are not bound by the Kyoto Protocol, however, are free to focus on the goal of solving climate change without suffering the limitations of the accord. Indeed, they have greater flexibility to experiment with policies, identify best practices, and market them to other governments. This bottom-up policy environment allows policymakers to engage in innovative measures, unbound by national expectations to meet an international commitment.

Sub-national governments are particularly sensitive to the differences in top-down and bottom-up systems. These governments must deal with the pressures from their national governments as well as local interests. Many climate change decisions are made at the sub-national level, as these governments frequently control natural resources, utility decisions, and land use policies. They therefore play a crucial role in climate policy decision making and in turn have responded to the issue in multiple ways. To illustrate the variation in policy responses I have created the Sub-national Climate Policy

Typology.

This typology categorizes sub-national climate policies into four groups. Climate

Obstructionists try to prevent the adoption of aggressive climate change policies, usually because the costs of these policies are perceived to be very high while the benefits are low. Climate Fruit-Pickers are more accepting of addressing climate change but are interested in pursuing low-cost policies that have more appearance of action than substance. In other words, they are interested primarily in ―picking the low hanging fruit.‖ Climate Innovators develop policies that focus on combining climate change with 17

other pressing issues of energy independence, economic development, public health and human security, resulting in new and innovative policy outcomes. Finally, Climate

Crusaders adopt aggressive climate policies and attempt to spread them to other actors.

Sub-national governments are characterized according to two crucial variables.

The first is the cost of transitioning from a fossil fuel-based economy to one that depends on renewable resources. States that face a high cost are going to be less interested in directly tackling the climate change issue, resulting in either Obstructionist policies that attempt to prevent action entirely or Innovator policies that attempt to hide climate change behind other issues. Lower costs result in Fruit Picker and Crusader type policies.

The second variable is the priority of solving climate change. In other words, how high does the first goal discussed earlier in this section rate on the priority list of the public and policymakers in each sub-national government? When climate change is low on the priority list, we find Obstructionist and Fruit Picker behaviors. Higher prioritization tends to result in Innovator and Crusader policies.

Other variables do not provide much leverage on this issue. Climate policy choice in the US and Canada for example cannot be easily explained by the usual suspects: strong environmentalism, Democratic control of the government, presence of strong coal or automobile industries, and even vulnerability to the effects of climate change cannot easily explain policy choices. For example, Texas, a state not known for its environmental leanings, adopted a renewable portfolio standard (RPS) in 1999, requiring that 5,880 megawatts of electricity be produced by wind power. Iowa originated the RPS a as a policy in 1983. Meanwhile, both California‘s and Florida‘s GHG targets were issued via executive order from Republican governors. Ohio, which has the fourth 18

largest GHG emissions in the US (behind Texas, California, and Pennsylvania), a

Republican legislature, and a thriving coal industry, passed an RPS in May 2008.

Meanwhile, Mississippi and Louisiana, two states highly vulnerable to the rising sea levels and more intense storms predicted of growing climate change, have two of the weakest sets of policies in the United States.

The Sub-national Climate Policy Typology gives us leverage on the variation in government policy responses to climate change, but to fully understand the differing policymaking processes in top-down and bottom-up systems we must turn to the Sub- national Climate Policymaking Framework. Figure 1.1 illustrates the Framework. As we will detail in Chapter 2, in a top-down system sub-national policymaking is bound to the

Kyoto Protocol and coordinated by the national government. Local conditions influence policy, but the restrictive environment for policymaking frequently results in weaker policies aimed at meeting the treaty‘s requirements but without keeping the larger goal of solving climate change in mind. One advantage of the system, however, is that climate change is consistently on the agendas of sub-national governments. This is not the case in bottom-up systems, where windows of opportunity and policy champions are instrumental in jump starting the policymaking process. Some governments may end up ignoring the issue entirely, but those with supportive local conditions often end up producing more innovative policy solutions than their top-down counterparts.

Top-Down Policymaking

International Treaty

Federal Policy

Bottom Up Policymaking

Rise of Window of Policy Choice Policy Adoption Policy Opportunity Champion

Cost Issue of Priority Transitioning

Policy Diffuses to Peers

Figure 1.1. Sub-national Climate Change Policymaking Framework

In chapter two we will explore the Framework in greater detail. Chapters three, four and five provide empirical evidence showcasing the differences between the top- down and bottom-up models as well as the widespread variation in sub-national policies in both systems. The evidence will show that while policies do vary widely, the most innovative policies occur at the sub-national level in bottom-up systems.

The Gap in Scholarly Understanding

This project speaks to a number of important scholarly literatures in international relations and American politics. Previous work in institutions and regime theory and policy diffusion address several of the issues concerned in this project but also leave a number of important gaps that provide ample room for new contributions.

Institutions and Regime Theory: As discussed earlier, climate change presents a crucial global public goods problem. The usual response to such problems is to create an international institution or regime to govern the issue. Clearly this was the case in climate change with the quick creation of the Framework Convention under the auspices of the United Nations. Other issues such as weapons of mass destruction, epidemic disease prevention, and the depletion of the ozone layer have also been quickly subjected to international governance. Indeed, there are many benefits to following such a course.

Keohane (1984) argues that regimes help states create efficient solutions to common problems by decreasing the transaction costs involved in international cooperation and increasing the shadow of the future. Axelrod (1984) notes that ensuring repeated interaction increases the likelihood of long-term cooperation by encouraging a system of mutual rewards for cooperation and punishment for defections. As an issue with a long time horizon, climate change would seemingly lend itself well to international regime-building, though also one subject to hard bargaining over regime design (Fearon

1998).

Another advantage to international institutions is their ability to monitor state activities and identify defectors. Milgrom, North and Weingast‘s (1990) discussion of the

Medieval Law Merchant emphasizes the importance of identifying the reliability of organization members while Morrow (2001) points out that mere involvement in an institution signals which states are willing to cooperate and which are not. The Kyoto

Protocol follows this convention by requiring member states to submit national communications regarding their policies, implementation, and outcomes which are made

publicly available. The non-ratification of the United States and Australia sent a clear message of the reluctance of these states to accept binding climate commitments.

A third benefit to international institutions is their ability to provide a centralized source of neutral information (Milgrom, North and Weingast 1990; Finnemore 1993;

Abbot and Snidal 1998). These organizations can collect and redistribute neutral information on best practices and the behavior of other states. The Intergovernmental

Panel on Climate Change is a scientific body that disseminates reports on the current state of climate change as a resource to all interested parties.

Even realists who are skeptical of the independent value of international regimes do not question the fact that states are drawn to regime creation as a method of solving international concerns. Indeed, for powerful states, regime creation is a sound strategy as they can lock in the current distribution of state power into the institution (Strange 1983;

Gowa 1989; Mearsheimer 1995). The main interest of these states is securing the best distribution of resources vis-à-vis other countries (Gilpin 1982). Other authors also focus on individual state benefits to participating in international regimes: Ikenberry (2000), for example, points out that institutions can allow powerful states to show strategic restraint, reducing fears and making it easier to maintain world order.

As seen, much of this literature focuses on the benefits of international organization. The costs, when discussed, are usually matters of the loss of state sovereignty or the distributional consequences of particular agreements. Concerns focus on the gains and losses for individual members and whether institutions exist outside the preferences of their members, not on whether international regimes as a venue are appropriate to solving collective action problems. Numerous studies tout the growing 22

importance of sub-national efforts on climate change, but few seriously suggest that these processes are a true substitute for international policy. I argue that states should not automatically turn to international processes when confronted with a new global problem.

Policy coordination can be pursued prematurely, running the risk of stifling more localized policy experimentation. In the case of climate change, states adopted binding targets before their publics were entirely convinced by the need for costly policies, and before adequate experimentation had occurred to determine best practices. Natural learning processes were stunted because policymakers were under pressure to adopt policies and produce results. This research therefore challenges the prevailing wisdom that international organization is always the best approach to solving global problems by arguing that in the case of climate change, a less regulated environment encouraging local policy experimentation can be a valid method of solving world issues.

Diffusion: Defined as ―the patterns by which organizations adopt a particular innovation across both space and time,‖ policy diffusion is a common suspect when governments adopt similar policies within a set period of time (Mooney and Lee 1995). As opposed to policy clustering, where states independently adopt policies to deal with similar situations, diffusion implies that governments are explicitly emulating policy choices made by peer actors. Such practices can have positive results if best practices are identified and followed or negative results if states attempt to squeeze themselves into poorly fitting innovations (Elkins and Simmons 2005).

The key feature of policy diffusion is that it ―occurs in the absence of formal or contractual obligations (Busch et al).‖ Thus a legal mandate by the European Union to its 23

member states that led to policy adoptions would not be considered diffusion. A wide variety of factors can lead to the diffusion of policy, including policy advocates (Skopcol et. al 1993; Mintrom 1997; Balla 2001), peer networks (Lazer 2005), and the interplay between international system dynamics, domestic factors, and policy characteristics

(Busch et al. 2005).

There are two main transmission paths for policy diffusion. Horizontal diffusion occurs when policies are transmitted between two or more peer government units. By far this is the most common type of diffusion studied in international and American politics.

Diffusion has been cited as a potential cause of numerous policy adoptions in U.S. states

(Walker 1969; Gray 1973; Berry and Berry 1990; Glick and Hays 1991; and Volden

2002) on numerous issues including climate change (Freeman 1985; Rabe 2004; Matisoff

2008). Countries frequently look to their peers for policy ideas as well, on private pensions (Brooks 2007), liberal economic policies (Meseguer 2005), and environmental regimes (Busch et al 2005) amongst others.

Studies of vertical diffusion processes are much more rare. Bottom-up diffusion—the transmission of polices from a sub-unit to a more centralized government—is particularly under-studied. Shipan and Volden (2006) argue that vertical diffusion of anti-smoking laws from U.S. cities to states occurs when state legislatures are professionalized. Gilardi (2005) examines the diffusion of independent regulatory agencies from western Europe to the European Union. Other studies cite the importance of bottom-up processes (Levi-Faur 2005) but few focus on state-to-national diffusion.

Another form of vertical diffusion, top-down diffusion, is usually described as ‗the advance of regulatory reforms as a response of national policy makers to exogenous 24

pressures from various international sources (Levi-Faur 1005).‖ It can also refer to sub- national governments responding to federal pressures or going above and beyond federal policies (Potoski 2001).

As studies of vertical diffusion are fairly rare, it is not surprising that few studies focus on the interplay between multiple diffusion pathways. Shipan and Volden (2006) consider local-to-local and local-to-state diffusion, while Jordana and Levi-Faur (2005) argue that regulatory capitalism diffuses internationally through ―within-sector‖ channels as well as domestically through ‗within-country‘ channels.

As we have seen, most studies focus on either horizontal or less frequently vertical diffusion but few examine how bottom-up, top-down and horizontal diffusion work together to produce policy outcomes. This research seeks to add to the latter body of research by looking at the interaction between bottom-up, top-down and horizontal patterns of diffusion of climate policy innovations. It is clear that sub-national climate policy is driven both by peer action as well as processes at the national and international levels.

Significance

Climate change is a unique global problem that faces a number of political barriers to finding solutions.

Short-Term, Visible Costs; Long-Term, Invisible Benefits: Sir Nicholas Stern‘s report claimed that the world needed to spend the equivalent of 1% of global GDP each year to solve the climate change problem (Stern 2006). These costs must be paid within the next 25

few years if they are to have any effect on the problem. The benefits of doing so— preventing climate change—would not, however, be felt immediately. In fact, if the problem is adequately addressed, they will not be ‗felt‘ at all. Solving climate change requires maintaining the status quo with no visible event that proves success. Instead, it is the absence of events—such as ferocious hurricanes or the continued melting of the polar ice caps—that will be the measure of success on this issue. If the short-term costs are not paid, then in several decades the effects will be felt. But when the benefits exist entirely in the distant future and are also difficult to measure, it becomes even more difficult to convince present actors that action is required in the short-term. Few politicians will have any incentive to undertake costly action now, when the benefits will not be seen in the near future (if at all). After all, these benefits could not be harnessed as political capital for future elections.

Concentrated Costs, Diffused Benefits: Another distribution problem with climate change is the classic problem of large group organization as discussed earlier (Olson 1965). The benefits of solving climate change are diffused throughout the entire global society while the costs are concentrated to those industries that rely on fossil fuel emissions to survive—such as the oil, coal, and automobile industries. These industries have lobbied successfully in many countries, including the United States, to keep action addressing climate change to a minimum (Legget 2001).

This is also a problem on a broader level. A government action taken to combat climate change has a very small overall effect, and if other actors choose to free-ride, then that government may have taken an economically costly, politically risky action that 26

results in little environmental benefit. This is even more relevant for cities and states/provinces whose greenhouse gas (GHG) reduction efforts will have very minimal effects on the overall global problem.

Vulnerability and Adaptation: To date, it is the larger, wealthier, industrialized countries that have emitted the bulk of the problematic emissions and these same countries are the ones most capable of adapting to the problems caused by climate change such as increased sea levels, coastal erosion, and reduced crop yields, as well as the human refugees displaced by these changes. The countries most vulnerable to these changes are also those that have contributed very little to the problem and can do little themselves by way of GHG reductions to effect a solution. This includes most developing states and particularly the small island states whose survival and existence could be threatened if sea levels continue to rise. Thus the states which have the greatest motivation to solve the climate change problem are those who lack the capability to do so—except through successful international negotiation and action. For these poorer states, climate change is a matter of security and survival; for the industrialized world, it is often viewed as simply a humanitarian issue, a difference of perspective that makes finding solutions difficult.

The Right to Develop: The divide between rich and poor states resulted in one of the main battles over the Kyoto Protocol: the right of poor states to develop. Since the global warming problem was caused mostly by industrialized states that used greenhouse-gas emitting oil and coal in their development, many developing countries claim that they deserve their ‗fair share‘ of GHG emissions as they industrialize. During the Kyoto 27

negotiations, the developing countries refused to be part of the process if they were required to cap their emissions; the United States, however, refused to cooperate if developing countries were not included. The right to develop, therefore, has become one of the most divisive issues in international cooperation on climate change and more than ten years later it remains the main argument of the US federal government to justify inaction.

Skepticism and Misinformation: Another issue is the campaign of misinformation that continues on global warming. Public opinion polls show that many people have misconceptions about the basic facts of global warming (that it is occurring and that it is a man-made problem); for example a 2006 Pew Center study showed that only 41% of

Americans believe that there is solid evidence of man-made global warming; 20% believe there is no solid evidence and 21% believe that current global warming is due to natural causes (Pew Center 2006). Globally, the US is one of the least concerned states, but even in climate-conscious Britain 32% of those surveyed claimed that they were ―only a little‖ or ―not at all‖ concerned about global warming. Similar or worse results were also found in Germany, Russia, Pakistan, China, and Jordan, though there was notably more concern in Japan, Spain, and India. The American media tends to frame climate change as an ongoing ‗debate‘ rather than a scientific consensus, and the few skeptics that remain are given equal air time with the much more numerous believers. If major actors all accepted the basic premise of the causes of the problem—or that it even exists!—it would remove a major barrier to action.

The Collective Action Problem: Finally, as a stable atmosphere is a public good, its provision presents a major collective action problem. The benefits of producing the greenhouse gas emissions that cause global warming and climate change are concentrated while the costs are diffused throughout the world (Olson 1965). Efforts by one state or sub-state actor to decrease emissions would be costly without producing noticeable benefit, and free-riding would likely be rampant. Since addressing climate change is an economically costly enterprise there is little incentive for states to unilaterally take action on climate change—especially if they have reason to believe that their economic competitors are unlikely to engage in similar measures. At the sub-national level, fears of becoming a sucker should be even more rampant, given the larger number of actors in the system.

These barriers continue to interfere with the successful development of strong climate policy. Indeed, divisions over which states should pay the costs for climate change—industrialized vs. developing—and whether efforts should focus on mitigation at the expense of adaptation continue to plague climate negotiations. This project demonstrates that the political realities of these barriers are not easily overwhelmed by top-down solutions such as the Kyoto Protocol.

Assumptions that problems with global consequences should be solved at the international level are common. Other issues of this magnitude—such as epidemic diseases or the proliferation of weapons of mass destruction—like climate change, are relegated to the international level and addressed through the creation of treaties and organizations. The climate—as a clear global public good—appeared to be perfectly suited to international governance. Indeed, previous experience with the ozone layer 29

provided a successful example of international cooperation in the Montreal Protocol on

Substances that Deplete the Ozone Layer.

Yet my research shows that the international regime on climate change, as a result of both its specific design and general intentions, poses challenges to the successful resolution of the climate issue. Membership in the regime limits the ability of national and sub-national governments to adopt policies adapted for local needs, resulting in policies that are weak, underfunded, or short-sighted. While membership does increase the likelihood that some policy will be passed, there is no guarantee that even full compliance and cooperation will achieve the principal goals of Kyoto members: solving climate change.

Scholars of international regimes must therefore be wary of assuming that the international level can carry the weight of solving global problems without making specific allowances for local needs. Local governments, unburdened by the need to respond to international obligations, are free to experiment with policies that have been local and, in the aggregate, global benefits. In this way, sub-national governments act as a policy laboratory for the national and international government, providing room for innovation and the development of best practices (Boeckleman 1992; Mossberger 1999;

Shipan and Volden 2006). Through trial and error, the best policies are identified and are able to proliferate to other sub-national as well as national governments. Activity in the

United States and Australia suggest that this particular global problem may be quite suited to being solved through horizontal and vertical diffusion of policies bred at lower levels of government.

Project Outline

In the following chapter I further explore the questions driving this research and begin to unpack the top-down and bottom-up models of policymaking. The resulting

Sub-national Climate Policymaking Framework gives us two very different paths of policy creation. I then present a new typology of Sub-national Climate Policy Choice, which contains four types of policy actors: the Climate Obstructionist, Climate Fruit-

Picker, Climate Innovator and Climate Crusader. I also outline my expected findings and the methods used to evaluate them.

Chapters Three and Four are devoted to empirically illustrating the Framework and Typology. Chapter three presents the case of Canada, a top-down policymaking environment from 1998 until 2006. The national government, committed to the Kyoto

Protocol attempts to bring its provinces on board with the treaty, resulting in varying reactions from the sub-national governments. In 2006, however, the new federal government abandons its commitments to Kyoto, creating a more bottom-up environment for policymaking. The province of Alberta helps illustrate the Climate Obstructionist and

Climate Innovator policy types, as over time a rising priority for addressing climate change coupled with a high cost of transitioning compels that province to abandon obstructionist behaviors for finding innovative solutions to climate change.

In Chapter Four I turn to the United States, an example of a bottom-up system.

My analysis of the United States reveals a policymaking environment ripe with experimentation, innovation and policy diffusion. The case of California shows us that even those states with reputations for environmental action are more likely to act under particular conditions. From 1998 until 2004 the state acts as a Climate Fruit Picker. 31

Indeed, it is not until 2006 when public support for solving climate change rises that

California fully embraces a role as a Climate Crusader.

In Chapter Five I expand the analysis to other provinces and states in those two countries, evaluating first the differences between the top-down and bottom-up model before comparing policymaking in these countries at the national and sub-national levels.

I find evidence that policy experimentation and innovation is the most extensive at the sub-national level in bottom-up systems. Finally, Chapter Six will discuss the theoretical and policy implications of my findings and offer some avenues for future research.

Chapter 2: Sub-National Climate Change Policymaking Framework

In this chapter, we consider the argument made in policymaking and scholarly circles that global problems are best solved from the international level downwards.

Climate change follows this conventional wisdom, with policymaking moving quickly from the national to international level. The evidence suggests, however, that this international effort has not produced the desired results, as emissions continue to rise and countries are having trouble meeting their commitments. Surprisingly, some of the best practices in climate policy are being produced by countries that are not members of the international regime—and even more surprisingly, they are being produced at the sub- national level of government. Subsequent analysis leads us to conclude that the bottom- up model of policymaking is a viable—and perhaps even superior—alternative to current convention.

The conventional wisdom on global problems in both policymaking and scholarly circles generally cites international cooperation and regimes as the best method of creating solutions. Diseases, for example, are routinely managed at the international level, first through various conferences—as in the 19th century when countries met to manage outbreaks of cholera—and then through the World Health Organization (Haas

1990). The proliferation of weapons of mass destruction is another global problem

managed primarily through international negotiation and treaty. And many environmental problems—such as the ozone layer, managed through the Montreal

Protocol on Substances that Deplete the Ozone Layer—has been assigned an international domain for finding solutions. This pattern holds true in climate change as well. States quickly turned to the United Nations as the logical forum to handle this global problem. As Secretary-General Ban Ki-Moon recently stated ‗This is to be a complex and challenge for any country, corporation, or community to address alone…

This global challenge requires a global response‖ (2008). Most governments pay at least lip service to the need for international agreements on this issue—even the United States, which ultimately failed to ratify the Kyoto Protocol, has ratified the Framework

Convention and is participating in negotiations for a successor agreement to Kyoto. It has also initiated independent efforts to create new international frameworks for action, such as the non-treaty Asia-Pacific Partnership on Clean Development and Climate.

Scholarly commentary tends to support such developments. Scholars argue that problems of collective action require top-down solutions guided by international regimes.

International organizations can also be useful to provide public goods and overcome the free-rider problem. An atmosphere free of excessive greenhouse gases can be considered a public good. It is non-exclusive, as one actor‘s enjoyment of the atmosphere cannot prevent another actor‘s enjoyment or use. It is also non-rival, as neither actor‘s enjoyment precludes the others‘ (Olson 1965). As with all public goods, it is difficult to ensure the provision of a healthy climate. Once the good is provided, other actors can simply enjoy its benefits without having paid any of the costs. This gives them an

incentive to free-ride on the efforts of the provider. Since everyone has this incentive, the good is frequently under-provided.

One way to solve this problem is to find a single actor—usually, government-- willing to provide the good (Hardin, 1968). There is, however, no world government that can simply produce this particular public good. Emissions are produced by every country that produces or consumes fossil fuels and therefore each country must work collectively to reduce the emissions that lead to global warming. Without a world government, states turn to international institutions to help them coordinate their actions. Institutions can help states achieve cooperation and can change patterns of state behavior (Keohane,

1984; Martin, 1992; Abbott & Snidal, 1998). States interested in solving climate change are likely to suffer from a prisoner‘s dilemma, fearing that their own cooperation (via the reduction of emissions) will be met by other actors with defection (as they continue to increase their own emissions). As each state fears defection, few will be inspired to cooperate, resulting in an under provision of the public good. Regimes can alleviate the difficulties of a prisoner‘s dilemma-type game between states. They can provide clear information about the intentions of other actors and their compliance with the rules, lowering the risks of defection. Furthermore, centralizing the process reduces the transaction costs of negotiating agreements with each individual country. As these countries continue to interact through this institution, low-stake, reciprocal cooperative behavior on procedural issues may in time breed higher levels of cooperation on substantive issues. Continued interaction raises the shadow of the future as states that seek cooperation in the future find incentives to cooperate in the present. Finally, trusting a neutral organization to oversee the process and monitor compliance can help limit fears 35

of defection (Oye, 1985; Axelrod, 1984; Keohane, 1984). Regimes, in short, allow states to overcome many of the problems associated with collective action and are therefore commonly created when new global problems arise.

Such has been the case with climate change. States followed their usual path of behavior when confronted with this new global problem. Meetings between concerned countries began soon after the issue was broached in 1988, at which time the

Intergovernmental Panel on Climate Change was created within the U.N. system.

Following the release of the first Assessment Report in 1990, a flurry of international responses culminated in the creation of the Framework Convention on Climate Change in

1992, and later, its 1997 Kyoto Protocol. The Kyoto process was intended to ensure that industrialized countries were bound by an international treaty to reduce their greenhouse gas emissions.

Yet for several reasons the Kyoto regime has achieved at best mixed levels of success. Some countries are falling short of their commitments and others are adopting questionable policies that technically comply with Kyoto but fail to actually produce emission reductions. In addition, experts have pointed out that even full compliance with

Kyoto would not prevent climate change.

Some of the same countries that originally championed Kyoto as the best way of addressing the global warming crisis are in danger of not fulfilling their own commitments. Figure 2.1 illustrates the rise in global emissions since 1970. There is a clear upward trajectory in the emission of all the major greenhouse gases. One contribution to this increase is the economic development of countries such as China and

India that have not been given binding targets under the Kyoto Protocol. Another large 36

part is due to emission increases in the United States and Australia, neither of which has ratified Kyoto. Clearly, however, Kyoto-ratifying countries are doing their part.

Canadian emissions have increased by 25% from 1990 to 2005 and Japan‘s emissions have increased by 7% over the same period (Netherlands Environmental Assessment

Agency, 2007). Even the European Union, which has managed a 4.3% collective reduction from 1990 levels, is projected to fall short of its original 8% commitment

(European Environment Agency, 2009). Indeed, neither of the two major climate policy initiatives, the 1992 adoption of the Framework Convention and the 1997 Kyoto

Protocol, have had a discernible impact on global emissions.

Figure 2.1 Global Emissions of Greenhouse Gases

In addition, some states are adopting questionable policies that meet the technical requirements of Kyoto but ultimately do little for or even damage the underlying effort to mitigate climate change concerns. For example, the climate regime uses 1990 as the

benchmark year for the determination of reductions. Those states that experienced a collapse in energy consumption with the collapse of communism—such as Russia-- are therefore able increase their emissions under the regime. Figure 2.2 shows that while these states have not yet matched their high 1990 emission levels, emissions have indeed been on the rise in the last decade. Furthermore, some commentators point out that

Germany‘s ability to quickly meet its targets has relied on absorbing the low emission rates of post-communist, post-reunification East Germany. More generally, Kyoto incentives measures that produce identifiable emission reductions in the short term rather than more fundamental policy changes and investments that could produce greater reductions in the long run (Keeler & Thompson, 2008). Some states, for example have met their targets by switching from oil and coal to natural gas as an energy source— which is itself a greenhouse gas, though a more minor pollutant than traditional fossil fuels. And still other states are taking advantage of the prices on the carbon market—in some cases, building up production of greenhouse-gas producing industries in order to earn carbon credits for the safe capture of these gases (Noss, 2001).

Source: Netherlands Environmental Assessment Agency

Figure 2.2 Greenhouse Gas Emissions Trends in Kyoto Countries

Even more problematic is the fact that the Kyoto target of 5% falls well short of what experts claim is needed to stop climate change. In fact, even if Kyoto achieves full participation and compliance by all industrialized countries it would not solve the problem of climate change. The average reduction in CO2 emissions in Kyoto is 5.2%; the IPCC at the time originally recommended a 60% reduction to stop global warming and now recommends closer to an 80% reduction. Perfect compliance with the regime therefore would still represent an under-management of the global warming threat.11

Perhaps the most damning indictment of the Kyoto Protocol is one striking and counter-intuitive observation: precisely those countries that have been the most reluctant

11 Of course, more stringent reduction targets would help but industrialized countries are having great difficulty negotiating such targets and developing country emitters are still reluctant to assume any quantitative limits at all (Thompson, A., personal communication, 2009). 39

to go along with Kyoto—Australia and the United States-- boast some of the most widespread and innovative action on climate change at the sub-national level. Within these states there are regional cap-and-trade programs, more than half of the members of the worldwide Cities for Climate Protection Program, carbon taxes, substantial emission reduction targets, strong incentives and regulations on renewable energy consumption, and aggressive automobile emission standards. We might expect that Kyoto would have had a marginal impact on the US and Australia. They have strong national commitments not to either ratify the agreement or adopt climate change policies, fearing the high costs of complying without meaningful participation by developing countries such as China and India. Yet these non-member states boast some of the most innovative and effective practices in the world.

It is this observation that drives this research project. Why are sub-national governments in non-Kyoto countries producing innovative and effective responses to climate change? The remainder of this chapter offers a framework for answering this question. In the next section, we will examine the top-down and bottom-up policymaking models and the primary features that distinguish them. Combining the two models gives us our Sub-national Climate Policymaking Framework which we will then look at in some detail. We will then focus on the policy choice phase of the Framework, presenting a new typology of climate policy choice. After briefly outlining our expected findings, the chapter concludes by explaining the methodology for the case studies that follow in chapters three and four.

A Framework for Climate Change Policymaking: Top-Down vs. Bottom-Up

Systems

In this section I argue that the Kyoto Protocol creates a top-down policymaking environment that inhibits policy experimentation and innovation in sub-national governments that are bound to it. Those sub-national governments in countries that are not bound to the Protocol, however, have greater flexibility to experiment with policies that fit their local resources and political circumstances. First we will examine the differences between top-down and bottom-up models of policymaking. Then we examine the features we expect to find in policies produced by these two systems, thus connecting system to policy. Third, we will present a framework of policymaking that incorporates both policymaking models and helps us explore the different constraints and incentives policymakers operate under in each system. Finally, we explore one part of the framework in more detail by formulating a typology of policy choice.

Top Down and Bottom Up Models of Policymaking

The top-down model of policymaking, as diagramed in Figure 2.3, allows the higher levels of government to dictate the parameters of policymaking to lower levels.

States establish an international regime which provides policy priorities and frameworks for action to its membership of national governments. These national governments, committed to meeting their international commitments, in turn require particular policies or outcomes from their sub-national units. Regulations may require a set time period for adoption or may stipulate certain actions on the part of these governments.

In this model, there are few incentives for sub-national policy experimentation as the national government is primarily interested in results that can be touted to peer countries and any monitoring and enforcement agents. Meanwhile, sub-national governments will be competing with each other to ensure that the distribution effects of federal policy will bend favorably in their direction.

International Regime

Policies

National Government

Policies

Sub-National Sub-National Sub-National Government Government Government

Figure 2.3 Top Down Policymaking

An example of a top-down solution is the Montreal Protocol on the Ozone Layer.

In 1931, Chlorofluorocarbons (CFCs) first came into use in the creation of foam and refrigerants for commercial products. By the 1980s, more than two billion pounds were produced annually, with about 30% of that supply coming from the United States

(Rosenbaum 342). In 1973, Sherwood Roland and Mario Malina, chemists at the

University of California, Irvine, conducted research that indicated that CFCs contributed to the loss of ozone.12 Their results were confirmed in 1976 when the National Academy

12 They were awarded the Nobel Prize in Chemistry for their work in 1995. 42

of Sciences issued a report citing CFCs as a primary contributor to the growing hole in the ozone layer (National Research Council, 1976). Publicity following these events led the US to ―ban CFCs from all domestic aerosol products in 1978 and to press other nations to take similar action‖ (Rosenbaum 342). It was not until 1985, when British scientists in Antarctica discovered a sizable hole in the Ozone layer that international attention became more pronounced. Convinced of the scientific evidence, forty-seven nations signed onto the Montreal Protocol to the Vienna Convention for the Protection of the Ozone Layer. Signatories (including the 120 countries that have since signed onto the accord) agreed establish a 1999 deadline for reducing production of CFCs 50% below

1986 levels along with intermediary deadlines in 1994. Additional agreements in London

(1990) and Copenhagen (1992) accelerated the pace at which CFCs were phased out.

The Ozone Layer is a problem for which the top-down policymaking approach has been used quite effectively. Scientific evidence led to a common consensus on the nature and cause of the ozone problem and effective solutions were readily identified by national governments.13 Taking the lead, the United States initiated an international accord amongst world producers of CFCs leading to an aggressive treaty that received widespread support. In the United States ozone regulations were quickly incorporated into the revisions to the Clean Air Act in 1990.

As we shall see, certain conditions of the ozone problem lend themselves to being addressed primarily at the international level. Chief among them were the shared understanding and certainty in the cause of the problem and the actions needed to be

13 Haas (1990) argues that this ‗consensual knowledge base‘ is in fact essential to creating a successful international solution to global policy problems. 43

taken to find solutions. By contrast, the existence and causes of climate change continue to be debated amongst countries, and no single solution has been identified as a panacea for the problem. Furthermore, it was relatively painless for CFC producers to phase out the product but the economic cost to moving to a fossil fuel free economy is much greater. Climate change presents much greater costs, and this is one reason why the bottom-up model offers several advantages to those seeking policy solutions.

The Bottom-Up Policy Making (BUPM) model offers an alternative path to policy creation. Under this model, the national government is not bound to international policy and indeed, provides few guidelines to policymaking in this area to sub-national governments. The positive side of this environment is that sub-national governments are free of national requirements and are therefore able to experiment with policies that suit them at the local level, potentially creating standards that could influence future national policy decisions.14 As Figure 2.4 illustrates, there is also the possibility for horizontal diffusion of policies between peer governments. Without federal regulation, states may engage in a ―race to the top‖ to attract investors interested in environmentally-friendly regulations.15 Additionally, governments may feel inclined to pass policies prior to federal government involvement, both in hopes of keeping local-grown policies in place and possibly influencing the federal policymaking process.

14 There is of course a downside to this arrangement. In a bottom-up environment, sub-national units may completely ignore the global issue, leading to very low levels of action. The lack of centralization may also lead states to experiment inefficiently with policies and overlap in their efforts. 15 Indeed, many of the industry experts interviewed mentioned that demonstrating environmental credentials has become a requirement to do business in many markets. 44

International Regime

National Government

Policies

Sub-National Sub-National Sub-National Government Government Government

Figure 2.4: Bottom Up Policymaking

The treatment of acid rain in the Clean Air Act Amendments in the United States offers an example. The regulation of acid rain in the United States is a good example of process of policy experimentation where the national government took cues from its sub- national counterparts. In the 1980s, the acidification of lakes in the eastern United States became a substantial concern, as pollution from Midwestern coal-burning states traveled over state lines. Four states developed policies regulating the emission of sulfur dioxide:

Massachusetts, New York, Minnesota and Wisconsin. These states and several others petitioned the EPA to stop Ohio and other Midwestern states from producing sulfur- dioxide, but it was not until the Clean Air Act Amendments in 1990 that the federal government stepped in with a cap and trade system for sulfur dioxide. This particular policy choice is largely viewed as ―a response to the failure of command and control approaches used by some states‖ (Hahn 1990). Failed policy experiments by individual

US states ultimately resulted in a stronger policy by the federal government, albeit it took quite a while before the national government acted. Other parts of the Clean Air Act were 45

influenced heavily by policy experiments in California to decrease air pollution and city smog.

Connecting System to Policy: Features of the Policymaking Models

Membership in the Kyoto climate regime—or lack thereof—creates certain policymaking conditions that have important implications for policy adoption. Table 2.1 illustrates the dimensions across which the two systems differ. Top-down systems tend to produce ‗direct‘ climate reduction policies, while bottom-up systems are more likely to adopt ‗indirect‘ policy measures. In addition, policies in top-down systems are more likely to focus on short-term deadlines while longer term approaches are more common in bottom-up environments. Finally, levels of innovation in climate policy making are likely to be higher in bottom-up countries than in their top-down counterparts. Let us explore the rationales behind each of these features.

Table 2.1. Policy Features of Top-Down and Bottom-Up Policymaking

POLICY FEATURE TOP-DOWN SYSTEMS BOTTOM-UP SYSTEMS

Policy Emphasis Direct Indirect

Time Frame Short Long

Innovation Levels Low High

Policy Emphasis: There are many ways to categorize climate policies: by sector, such as transportation, industry, or buildings; by whether they rely on market mechanisms (taxes, cap and trade systems) or command and control regulations (absolute targets; efficiency 46

standards for automobiles); by a focus on adaptation to the effects of climate change or mitigating its causes; whether they lead directly or indirectly to emissions reductions; and whether they are explicitly labeled as ―climate change policies‖ or not. It is the latter definition that helps us understand a key distinction between policies in top-down and bottom-up systems. The difference is that ―direct‖ policies keep greenhouse gas reductions as their central focus: either by capping emissions at a particular level or by removing carbon dioxide from the atmosphere. These policies deal directly and explicitly with climate change and greenhouse gas emissions. ―Indirect‖ policies can achieve emission reductions, but do so indirectly and often as a secondary benefit of the policy— perhaps by increasing the available fossil fuel alternatives though the creation of a

Renewable Portfolio Standard.

Direct policies, sometimes referred to as ―climate‖ policies, aim at reducing the greenhouse gas emissions that cause climate change. Sometimes these efforts stop at creating inventories of greenhouse gases or establishing climate change commissions, advisory bodies, or action plans. Some governments go further, however, adopting measures that call for or lead to actual emission reductions. One popular measure is adopting greenhouse gas emission targets. Governments can set a goal and deadline for reducing emissions of specific greenhouse gases. These targets can be voluntary or mandatory and can require either an absolute amount of reductions or a reduction in the carbon intensity of the economy. The most common type of target is an absolute percentage reduction in emissions based on a baseline year, usually 1990. Since the inclusion of binding targets in the Kyoto Protocol, this has become one of the most commonly adopted policy options. 47

A second direct policy is a carbon cap or offset. Specific power plants (frequently new plants) are capped at a certain level of emissions or are required to off-set their emissions. In some cases, carbon-producing power plants are taken completely offline and replaced with nuclear or other facilities. Europe‘s method of meeting its Kyoto obligations has required setting caps on carbon emissions through the allocation of emission permits to various companies. Companies that under-emit are free to sell their permits on an open market to those that cannot meet their obligation.

A third direct policy is regulating greenhouse gas emissions from automobiles.

Governments can require automakers to produce vehicles that meet particular emission standards. Since the transportation sector is frequently a large contributor of greenhouse gases, this can be a very effective climate policy.

Carbon capture and storage is another possible direct measure that governments can use. Rather than reducing the production of emissions, these policies aim to prevent the emissions from reaching the atmosphere. A simple example of this type of policy is to plant more trees, as trees rely on carbon dioxide for survival. But other options exist: carbon can be injected into the ground or the ocean and held there. Carbon capture and storage allows governments to avoid altering their existing fossil fuel use and instead focus on reducing the harmful byproducts of that use.

Another example of a direct policy is setting a price on carbon. Governments can directly tax the production or consumption of carbon. A policy strongly advocated by economists to address climate change, the carbon tax experienced initial popularity during the height of initial awareness of climate change in the early 1990s and has since faded with the advent of cap-and-trade programs following Kyoto. No US state has an 48

explicit carbon tax, but the city of Boulder passed a city-wide carbon tax in 2006, and

British Columbia created one in 2008.

Governments also directly address climate change through creating climate action plans, commissions, partnerships, or advisory groups tasked with leading policy on climate change, and establishing greenhouse gas inventories and registries. Climate action plans detail a state‘s ability to reduce greenhouse gas emissions and therefore its contribution to climate change. The plans may list particular policy options that will work for that state, but additional laws are needed for reductions to be put into place.

Executive and legislative advisory commissions are often tasked with creating a Climate

Action Plan for the state or in some other way determining the state‘s potential sources of action against climate change. GHG inventories and registries are estimates of a polity‘s greenhouse gas emissions and are a useful tool of measurement for determining the success of future reduction efforts.

―Indirect‖ policies include those measures that can indirectly produce emission reductions but are not necessarily explicitly tasked to do so. These reductions are often a positive externality of the policy‘s primary rationale, which can be to reduce budget waste or increase investment in renewable energy. In fact, it can be difficult to measure the direct contribution of these policies toward emission reductions. While these policies can be and are used as a response to climate change, they have also been adopted by governments that have no interest in addressing global warming.

One example of an indirect policy is a Renewable Energy Portfolio Standard, or

RPS. These standards require utility companies to generate a certain amount of electricity 49

from renewable energy sources. Frequently governments will adopt a percentage target, suggesting or requiring that by a particular date, x amount of electricity will come from renewable sources. As the percentage increases, reliance on fossil fuels decrease, potentially leading to fewer emissions. This policy is popular amongst governments interested in decreasing dependence on imported fossil fuels or who want to stimulate investment in alternative energy technologies.

Energy efficiency standards are another example of indirect policies. By adopting

‗green‘ standards for appliances, and commercial, residential, or government buildings governments can reduce costs in their budget, claim environmental credentials and inadvertently lower greenhouse gas emissions.

Overall, we should expect to find direct policies to be more prevalent in top-down systems and indirect policies to be more common in bottom-up environments. There are two reasons. First, policymakers in each system have different incentives regarding how much they want to advertise their action on climate change. In top-down systems, policymakers will be drawn to policies that easily showcase their action on the issue. In bottom-up systems, officials may wish to downplay the impact of their policies on global warming. Second, top-down governments are more subject than their bottom-up counterparts to the standards and expectations that the international regime has established for policy. To receive credit for their actions, they must adopt policies that

―count‖ in the eyes of their national government and international observers.

One reason indirect policies find a better home in bottom-up systems is that policymakers sometimes have an incentive to hide the connections of their policies to climate change, particularly in locations where the public doubts if global warming exists 50

much less if it is caused by fossil fuel use. Indirect measures present a unique opportunity to policymakers concerned about climate change who operate in environments hostile to action on global warming. Because they only indirectly lead to emission reductions, it is possible to pass climate change policies without even mentioning the words ‗global warming‘. Pursuing indirect policies such as energy efficiency and renewable energy measures is therefore a way to get climate policy in through the back door in environments that would be hostile to more overt actions.

Policymakers in top-down systems face different incentives. With the federal government demanding action, they want to advertise their climate-consciousness and prove that they are actively responding to the issue. This does not necessarily mean that they want to adopt costly measures, however. In fact, sub-national governments in top- down situations may wish to avoid too much success in reducing emissions, lest the federal government demand more or peers free ride on their efforts without pursuing their own reductions. Many of the direct policies create the illusion of acting without actually requiring a large change in day-to-day emissions. Governments are free to create climate action plans, form commissions, or start GHG inventories which demonstrate forward momentum on climate change to observers. Indirect policies, on the other hand, require time and effort to convince onlookers that they will lead to emission reductions in a timely manner and therefore present greater costs to sub-national governments that simply want to get their federal counterparts off their backs.

A second reason why top-down systems frequently choose direct policies is that certain standards for climate action have been set by the international climate regime.

Greenhouse gas emission targets, for example, have been a core feature of climate policy 51

since 1988 at the Toronto Conference when attendees called on governments to reduce global carbon dioxide levels by 20% from 1988 levels by 2005. Continuing this policy path, the 1992 Framework Convention on Climate Change called on the world‘s industrialized countries and countries-in-transition (i.e., former Soviet and satellite states) to reduce their emissions to 1990 levels by the year 2000. Finally, the Kyoto Protocol to the Framework Convention called on these states to reduce their overall emissions by 5% below 1990 levels during a 2008-2012 commitment period. Targets have since become de rigueur for climate activists, with many countries adopting individual targets more rigorous than those agreed to at Kyoto in order to prove their climate prowess. Great

Britain, for example, agreed to an 8% target in 1997 but within a few years took on a more stringent 20% target. Likewise, seventeen US states, none bound by a Kyoto target, have adopted targets of their own: Minnesota, for example, intends to reduce its emissions by 90% under 2005 levels by 2050.

Targets and other direct climate policies have in many ways become required policies as far as observers are concerned. Governments that support the Kyoto Protocol or adopt more stringent national targets are good climate citizens; those that do not are considered to have a damaged reputation.16 For policymakers in top-down environments, therefore, who must prove to their federal governments that they are indeed acting on climate change, certain measures count more than others. Going after more indirect measures requires additional energy to convince national and international officials that the government is not avoiding the issue of climate change. In addition, it can be more

16 From 2000 until 2006, the Sierra Club graded Canadian provinces on their climate change performance. Provinces that did not support the Kyoto Protocol regularly received the grade of F, even though many of them had several ventures in renewable energy at the time. Provinces that supported the Protocol received passing grades despite many other policy failings. 52

difficult to measure the impact indirect policies will have on greenhouse gas emissions— a commitment to increasing renewable energy does not necessarily mean, for example, that coal-fired plants will go offline. Fossil fuel emissions could continue to grow at the same time.

Time Frame: A second area of difference between top down and bottom up climate policies is the time frame for policy implementation and completion. Once again the

Kyoto Protocol influences policymaking in top-down systems, this time by creating incentives for policymakers to consider more short-term policies.

Article 3 of the Kyoto Protocol establishes the time frame for action under the treaty. The article creates a commitment period of five years: from 2008-2012 during which the states listed in Annex B must maintain a set level of emission reductions.

Additionally, the article dictates ―each Party included in Annex I shall, by 2005, have made demonstrable progress in achieving its commitments under this Protocol.‖ Thus

Annex B states need to adopt and implement policies in time to meet the 2005 initial deadline.

The Protocol was signed in 1997 and achieved the last necessary ratification from

Russia in 2002. Final ratification of the treaty was in doubt after the US Senate unanimously passed the Byrd-Hagel resolution vowing to refuse ratification so long as developing states such as India and China remained unrestricted by their own targets.

While some states moved forward with their obligations despite this hurdle, others delayed, wondering if they would be complying with a dead treaty. The treaty finally

came into force in 2005, just three years shy of the beginning of the 2008-2012 commitment period and in the same year as the deadline for ―demonstrable progress‖.

States wanting to comply with the 2008 Kyoto deadline faced a limited number of policy options that had any hope of lowering emissions within the allotted time frame.

Many states chose to ‗pick the low hanging fruit‘ and adopt policies that would produce sharp levels of emission reductions in a short period of time. Britain, for example, transferred its primary energy source from coal to natural gas (Gummer & Moreland,

2000). Natural gas, while less intensive a source of greenhouse gas than coal, still contributes to climate change, and thus Britain‘s early policy was fairly short-sighted and primarily aimed at meeting its Kyoto and EU targets. Certainly these states did not adopt long-term policies that required technological development in alternative energy such as building a nuclear power plant or wind farm as these facilities take many years to build and bring online and would not produce substantial results until long after the Kyoto commitment period ended. Thus, important and effective policy options were ignored in favor of those alternatives that would allow progress toward Kyoto targets within the established time frame. The design of the regime encourages short-sighted thinking in decision-makers who are unable to spend the time needed to create innovative responses to the climate problem. Therefore, top-down systems tend to breed short-term policies, set deadlines in line with the Kyoto Protocol, and ignore policies that, while potentially effective, take long periods to implement.

Decision makers in bottom-up states were not bound by the 2008-2012 commitment period and therefore have operated under a different set of incentives. They can benefit by announcing policies while in office, creating a ‗green‘ reputation for 54

themselves and their government, but adopt a far-off date for policy completion that takes place after they are out of office. This allows them to reap the benefits of passing aggressive policies while shifting the costs of implementation as well as the moment of accountability upon reaching the deadline to future governments. This is why we expect to find a longer-term approach in bottom-up systems.

Innovation Levels: Top-down and bottom-up systems also differ in the levels of policy experimentation and innovation that they produce. There are two reasons why we expect to find higher levels of policy experimentation and innovation in bottom-up systems than in their top-down counterparts.

First, bottom-up governments are free to think about climate change outside the context of an environmental problem managed by the Kyoto Protocol. Certainly the environmental impacts are potentially grave. Polar bears are now an endangered species, while the bleaching of coral reefs has led experts to fear the loss of substantial plant and animal life. Rising sea levels threaten coastal erosion while changing weather patterns have created new migration paths for birds and disease-carrying insects. Excessive greenhouse gas emissions lead to higher levels of air pollution. Furthermore, storms, floods, and droughts are expected to increase in frequency and intensity.

But climate change is not simply an environmental problem. There are multiple political issues that climate change implicates. It impacts issues of energy independence and supply, economic development, public health, and even human security. Energy issues are at the heart of the climate change problem. The greenhouse gas emissions that create global warming and climate change come directly from the production and 55

consumption of fossil fuels such as oil, coal, and natural gas. Worries about climate change can be compounded by concerns about a world ‗peak‘ in oil availability, the price of oil and gas, and dependence on foreign sources of oil. As policymakers discuss how to achieve a secure energy supply, one common theme is to create domestic sources of renewable energy. Doing so has the side benefit of decreasing dependence on the very fossil fuels that contribute to global warming.

Issues of economic development are also tied to climate change. The ongoing recession that began in 2008 only exacerbated prior concerns about the economic impacts of climate change. Economist Sir Nicholas Stern published a report in 2006 indicating that while addressing climate change would cost world governments the equivalent of 1% of global GDP, not addressing climate change would cost closer to 25% by 2025. Many governments are interested in finding new industries to invest in to create jobs and diversify their economies, and renewable energy is increasingly becoming an industry that they turn to. When these investment opportunities are tied to replacing current fossil fuel consumption with renewables, climate change is also addressed.

A third issue tied to climate change is public health. Fossil fuel emissions create air pollution which can have adverse health effects. Air pollution is already cited as the cause of approximately 800,000 global deaths each year (World Health Organization

[WHO], 2009b). In addition, the simple rising of temperatures can create heat waves which cause thousands of deaths as they did in 2003 in Europe. Meanwhile, disease- carrying insects are taking more northerly migration patterns, exposing new groups of people to their threat. The World Health Organization claims that ―climate change already contributes to the global burden of disease, and this contribution is expected to 56

grow in the future‖ (WHO, 2009a). Solutions aimed at these problems can either mitigate the causes of climate change—by perhaps shutting down coal-fired plants to reduce air pollution or passing regulations regarding automobile emissions—or help people adapt to the effects, by inoculating populations against diseases such as malaria or

West Nile Virus.

A final non-traditional area of climate change is that of human security. Rising sea levels and land erosion could produce large numbers of ‗climate refugees‘, particularly in the developing world where resources are already scarce (Stern, 2006;

Homer-Dixon, 1991). In 2004, a leaked Pentagon report claimed that climate change could descend countries into anarchy as food and water supplies diminish and countries fight over meager resources. As the report puts it, ―disruption and conflict will be endemic features of life‖ (Townsend & Harris, 2004). While debates continue as to whether or not environmental problems lead to security challenges, it is clear that widespread climate change could present unprecedented challenges to settled human populations as more people are required to live in less space.17 Certainly during individual environmental disasters, looting and civil unrest are not uncommon.

Top-down governments are certainly aware of these varied potential impacts of climate change. Many policies aimed at solving one of these problems can also be beneficial in addressing climate change. However, this knowledge is of limited use to top-down governments. They are bound by the Kyoto Protocol. There is no incentive for them to hide their policies behind another policy problem such as energy security. While they may market their policies as having benefits for other problems, the primary driver

17 On debates, see Homer-Dixon (1991), Drezner (2000). 57

behind policy creation is to address their federal government‘s commitment to the Kyoto

Protocol. Climate change‘s varied impacts become a tool for marketing, but not for innovation.

Bottom-up governments, can have much higher incentives for innovation as a result of the varied impacts of climate change. Pitching climate change as a standalone issue could lead policymakers to confront opposition from groups not interested in spending scarce resources on environmental concerns. Without a national policy directive to point to, they may end up being unable to pass any climate policy at all. They do, however, have the flexibility to create broader coalitions around policy that is more tightly entrenched in local culture. By looking instead to other issues that are of greater local concern—such as securing a domestic energy supply or providing new employment opportunities—policymakers can find inspiration for measures that handle multiple problems at once. For example, the renewable energy portfolio standard, now considered a staple in the climate policy handbook, had nothing to do with climate change when it was first created in Iowa in 1983. Instead, it was a measure designed to increase that state‘s capacity to produce renewable energy—creating jobs and reducing energy imports. Other governments later adapted this measure to address climate change, arguing that increasing the share of electricity provided by renewable energy would lead to a reduction in the burning of fossil fuels—and therefore, greenhouse gases-- for that purpose.

The second reason why innovation is lower in top-down systems is that there are few rewards for innovative behavior. Countries bound by the Kyoto Protocol must produce results over the 2008-2012 commitment period; as discussed above, this was a 58

very short time period. There was little time to properly experiment with new policies and little encouragement to do so. Instead, parties to the Kyoto Protocol discussed and supported particular measures for meeting their targets: for example, setting domestic targets, engaging in cap and trade, shutting down coal plants, and sponsoring sustainable development projects in developing countries. Progress is judged not by attempts to innovate but by a country‘s ability to meet its targets. Under these conditions, there are few incentives and little promise of rewards for governments interested in trying new policies. The Sierra Club, for example, has graded Canadian national and provincial policies on climate change and consistently gives higher grades to governments that support the Kyoto Protocol than those—such as Alberta—that are trying a different approach (Sierra Club of Canada, 1999-2006). Conversely, bottom-up states are not bound to any of the Kyoto requirements or standards and are therefore free to engage in policy experimentation. Doing so allows them to claim a leadership mantle on climate change and potentially influence later policy adoptions by peer governments and even the federal government, potentially enshrining a policy designed for their own local interests into national law. Thus, innovation levels are frequently higher in bottom-up environments.

To summarize, this discussion attempts to show that there are substantial differences between top-down and bottom-up models of climate policymaking. Top- down policies tend to more directly focus on emission reduction policies, have shorter term approaches, and feature less experimentation and policy innovation. Bottom-up policies, on the other hand, are generally more indirect, take a longer term approach, and 59

feature greater levels of policy experimentation and innovation. With this analysis in hand, we are free to combine the two models into a Framework of Sub-National Climate

Policymaking.

A Framework of Sub-National Climate Policymaking

As discussed earlier, there are two paths to climate change policy. The first path is the top-down path of Kyoto participants. The ratification of the international treaty creates a goal for the national government to meet its international commitments. They create policy parameters which are passed down to the sub-national governments in the states or provinces who attempt to find a workable policy that also meets local objectives and needs. Meanwhile, sub-national governments in non-Kyoto states are not given any directives in this area. Their policy process starts with a ―window of opportunity‖. This exogenous shock lifts climate change up on the local agenda and is at least temporarily a salient issue. In some cases, the opportunity is then grabbed by a Policy Champion (PC).

This idea entrepreneur, usually a government official, is invested in the climate change issue and determined to see policy passed that will produce local action on the issue.

Without a PC, the moment of opportunity is likely to be lost, resulting in no policy.

At this point the processes converge, as policymakers choose policies depending on local conditions such as the cost of transitioning to a fossil-fuel free economy and the priority finding solutions to climate change. Four types of policies emerge: Climate

Obstructionist policies, Climate Fruit-Picker policies, Climate Innovator Policies, and

Climate Crusader policies. They are discussed in the next section. Once policymakers choose a policy, the two paths diverge again. The bottom-up model has an additional 60

step following policy adoption—the diffusion of policy horizontally to other sub-national governments. This is less likely to happen in a command-and-control environment in the top-down model where federal governments are looking for compliance with a nationally set target. In a bottom-up environment, governments are not bound to any particular set of policy choices and are more likely to investigate options adopted by peer states. These options are picked up by Policy Champions both for the purpose of actual policy emulation as well as to push policymakers into keeping up with the policy decisions of peer governments.

Top-Down Policymaking

International Treaty

Federal Policy

Bottom Up Policymaking

Rise of Sub-National Window of Policy Adoption Policy Opportunity Policy Choice Champion

Cost Issue of Priority Transitioning

Policy Diffuses to Peers

Figure 2.5: Framework of Sub-National Climate Policymaking

The top-down process is fairly straightforward: the adoption of international commitments by the national government creates pressures on sub-national governments to create policy to meet these obligations. The cost of transitioning and the issue priority both impact the eventual sub-national policy choice. The bottom-up process, however, is 61

more complex, and therefore requires greater attention In the remainder of this section, therefore, we will look at the bottom-up process in more detail, focusing particularly on windows of opportunity, the role of policy champions, and policy diffusion. The process of policy choice and adoption will be discussed in the next section.

Windows of Opportunity: A ‗window of opportunity‘ here describes the brief moments of time following an exogenous shock to our understandings of the problems of climate change and energy security. These events, which receive substantial press coverage and national attention provide opportunities for the concerned Policy Champion to reframe public understandings of climate change in a new direction. Many scholars have pointed to the usefulness of such policy windows in triggering actions (Kingdon, 1984; Cobb &

Elder, 1972).

These shocks are events which provide new information about climate change.

Frequently these events are natural disasters with local impacts that can be attributed to climate change, such as hurricanes, wildfires, floods, and droughts. Hurricane Katrina, for example, instigated widespread attention in the United States to the possibility of climate change increasing the intensity of severe storms. Major international conferences and reports also provide moments of opportunities as they change the level of uncertainty actors have about the nature and effects of climate change. Thus the signing of the Kyoto

Protocol to the Framework Convention on Climate Change (1997), the release of the

2007 reports by the Intergovernmental Panel on Climate Change, and the widespread viewing of the documentary An Inconvenient Truth in 2006 raised the awareness of

climate change on local agendas. Finally, severe economic events focus attention on energy costs and efficiency issues, particularly when the price of oil and gas rise.

The ‗window‘ may also result from an anticipated event. Some policymakers are driven to act in anticipation of an event that might make future action more difficult. For example, many policymakers were convinced that the election of Barack Obama would bring a new set of federal policies on climate change in the United States—policies that would impact US states and Canadian provinces alike. Climate change rose in salience for these policymakers as they tried to ensure that their local policies would be locked in before the creation of US national policies that might be locally less favorable.

However, the window of opportunity is just that—an opportunity. For climate policy to result, the moment must be harvested by an actor invested in finding solutions to local climate change.

Policy Champions: A Policy Champion (PC) is a type of policy entrepreneur:

―individuals who command widespread respect for their expertise on a given issue and their integrity as credible brokers of information‖ (Rabe, 2004, pg. 23). Policy champions initiate the process of policy selection and adoption. They put their issue on the political agenda and push for legislation by convincing elites of public support and political rewards (Betsill and Bulkeley 2003). Dedicated to finding a politically possible solution to a particular problem, they act as intermediaries between the public and elites, trying to ensure that their pet issue is addressed according to their own particular beliefs and preferences. In climate change, these actors are legislators and governors who have adopted climate change as a key personal concern. When windows of opportunity arise, 63

the Policy Champion‘s main role is to build a coalition amongst lawmakers, the public, environmental groups, fossil fuel industries and other stakeholders around a policy or set of policies that address the climate change issue. Their success depends on their ability to find a suite of policies that maximize this coalition to ensure policy passage.

Policy Diffusion: Once policies are adopted, they become part of the wider policy space that is available to new potential adopters. While sub-national governments enter their window of opportunity, Policy Champions are on the lookout for policies that will be welcomed in their unique composite of local resources and needs. It is common for states to look to peer actors for policy ideas (e.g. Walker, 1969; Brown, 1969; Brown & Cox,

1971; Gray, 1973; Berry & Berry, 1990). Programs in welfare have spread across states, for example, as have innovations in smoking laws.18 In the area of climate change, the most direct case of policy emulation is with California‘s automobile emission standards: fifteen states indicated that they would adopt the California standard between 2003 and

2008. Some fear that states will do so to engage in a ―race to the bottom‖ in their environmental regulations, keeping their regulations lax enough to encourage business enterprise while exporting environmental impacts across borders (Drezner, 2000; Potoski,

2001). Evidence suggests, however, that some states actually are engaging in a ―race to the top‖ in climate policy, as an economy‘s ‗greenness‘ becomes a benchmark against which both citizens and consumers judge.

In other cases, the various ‗races‘ play no role—governments are simply interested in the results of their peers‘ experiments and want to adopt the resulting best practices. What is

18 See for example Gray (1973), Volden (2002), Shipan &Volden (2008). 64

clear is that as Policy Champions examine the various policy tools at hand, they are looking to their neighbors and peers for ideas, often bringing in representatives to conferences and meetings.19

As we can see, while both paths can produce strong climate policy, only the bottom-up process allows for this horizontal feedback mechanism through which governments engage in policy sharing and learning. This ‗laboratory‘ allows for both increased policy experimentation as well the identification of best practices (Thompson,

2006). Indeed, top-down processes can put a damper on local experimentation.20 Future chapters will evaluate how the Top-Down and Bottom-Up policymaking processes played out in four sub-national governments in the United States and Canada.

A Typology of Climate Policy Choice

The final component of the Framework is the process of policy choice. There are four possible policy types that occur when sub-national governments choose to engage in climate change. They are the Climate Obstructionist, the Climate Fruit-Picker, the

Climate Innovator and the Climate Crusader, and will be discussed in more detail momentarily. As Figure 2.6 illustrates, there are two principal factors that influence which type of climate policy a sub-national government will adopt. These are the cost of transitioning to a fossil-fuel free economy and the priority of addressing climate change as an issue.

19 In all four cases studied, policymakers admitted to looking seriously at action taken by other like-minded states. In three cases (Alberta, Ontario, and California), conferences were held where experts from other governments were brought in to share their successes and failures and provide ideas for future policy action. 20 See for example Shipan & Volden (2008). 65

Low Priority for High Priority for Climate Change Climate Change

High Cost of Transitioning Climate Climate to non-Fossil Obstructionist Innovator Fuel Economy

Low Cost of Climate Climate Transitioning Fruit-Picker Crusader to non-Fossil Fuel Economy

Figure 2.6: A Typology of Climate Policy Choice

Cost of Transitioning: The first factor that influences what policy type each sub-national government will adopt is the cost of transitioning from an economy dependent on the production and consumption of fossil fuels such as coal, oil, and gas to one that relies on renewable or alternative energy sources like solar, wind, hydro, or nuclear power. When these costs are high, policymakers are likely to ignore climate change, obstruct attempts to pass policy, or pass policies that only indirectly address global warming. Low costs, however, permit a government to engage in climate policymaking without facing significant political opposition.

A state or provincial government that is heavily dependent on fossil fuels will face large financial and political costs in its attempts to reduce greenhouse gas emissions.

On the financial side, it takes time and money to shift away from fossil fuel use. A region rich in coal and oil is likely already reaping revenue from these resources— revenue that would be lowered or eliminated once production ends. For some regions 66

this income is substantial—Alberta, for example, received 33% of its revenue from fossil fuel industries in 2008—and would therefore be difficult to replace quickly or easily

(Government of Alberta, 2009). In addition, the jobs provided by these industries would be lost leading to new strains on social service systems. Finally, the new sources of energy themselves have substantial start up costs. A 1500 MW nuclear plant, for example, costs 2.6 billion and seven to ten years to build (Vedantam, 2005). A 50 MW wind farm producing 150 million kWh a year would cost approximately $65 million to produce (American Wind Energy Association, 2005). And a photovoltaic solar system for an average family home still costs between $15000 and $20000 to set up (Facts about

Solar Energy, 2006; Vaughan, 2009). These start-up costs are expensive for the average state or provincial budget and would not be recouped for many years.21

These costs are a tough sell to a state or provincial government that also faces enormous political costs to adopting emission reduction policies. If a large sector of the economy is dependent on the fossil fuel industry, then any consideration of downsizing those industries will result in strong lobbying efforts by both workers and industry.

Doubts among the public regarding the existence of climate change or the role of humans in bringing it about can be exacerbated by media campaigns from these industries, resulting in people questioning the potential benefits of acting. With guaranteed high, unpopular costs and questionable benefits, it is unsurprising that policymakers will hesitate to adopt aggressive measures on climate change.

21 According to the U.S. Census Bureau (2003), average state expenditures in 2000 were approximately 21.7 billion. 67

This is why in high cost localities we expect to find one of three behaviors. In one scenario, policymakers will simply ignore the issue of climate change and continue business as usual. This is generally only possible in bottom-up systems where there is no pressure from the federal government to act. In such cases, there simply is no climate policy choice. The second possibility is that policymakers will attempt to obstruct climate policies—locally, nationally, and even potentially in peer states. Obstructionist efforts can take the form of stalling measures, outright rejection of proposed policy ideas, or campaigning against general or particular solutions to climate change, which they may argue is an issue not worth addressing. The third behavior is to engage in innovative climate policymaking. In some localities the high costs of acting are coupled with attractive benefits for action—usually due to a public demand for climate policy. In this scenario, governments must find a way to take action on climate change without following the usual (and costly) route of pursuing direct emission reductions. High cost environments can therefore lead to innovation as governments try to find a politically and economically acceptable way of addressing climate change while maintaining the fossil fuel industry.

Lower cost environments are not as subject to these pressures. When the economy is more diversified, fewer jobs and government revenue depend on the fossil fuel industry. Indeed, many states and provinces have a large share of their energy derived from renewable resources, leaving little economic or political clout for coal, oil or gas industries. These lower costs mean that acting on climate change is likely to be less objectionable to the public and decision makers. Two policy behaviors are the likely result. First, policymakers may simply engage in picking the ―low hanging fruit‖. These 68

measures are generally low cost and generate few controversies. Energy efficiency improvements often fall into this category. Since the cost of acting is low for these governments, they can claim a mantle of climate ‗leadership‘ and show their dedication to a popular cause without suffering political repercussions. Second, policymakers may take on the role of climate crusaders, adopting substantial policies at home and marketing them abroad, not simply claiming a mantle of leadership but actively wearing it. The difference between fruit pickers and crusaders is generally whether acting on climate change is seen as unobjectionable or actively desired. Policymakers may not gain much locally in the first case, but can achieve a lasting and popular legacy in the latter.

Priority of Climate Change: The second contributing factor to policy choice is the level of priority the local public and policymakers have for solving climate change. When the public views addressing climate change as a high priority, policymakers are likely to reap political rewards from engaging in climate policymaking. In a low priority environment, however, the public will wonder why time and resources are being devoted to an unimportant, potentially high-cost issue and may punish policymakers accordingly in the ballot box.

A high priority for solving climate change can create incentives for policymakers to act. When public opinion polls and media reports indicate support for action, policymakers can claim a mandate for their policies. In Berkeley, for example, the

―Measure G‖ ballot initiative calling for substantial climate action received 80% support, allowing the mayor‘s office to commit substantial resources to climate policies (Interview with Mayoral advisor). Furthermore, policymakers are more willing to engage in 69

aggressive, comprehensive, and/or innovative climate plans when they are reassured that the risks of punishment by the voters are low. For example, Gray Davis, then Governor of California, lent his approval to AB 1493 after being shown a Public Policy of Institute survey that showed strong public support for the measure. Prior to seeing the survey, he was decidedly lukewarm on the initiative and had indicated he might not sign it

(Interviews with Assemblyperson, ARB officials 1 & 2).

High priority is generated by several factors. First, it can emerge directly out of a general public concern with environmental issues such as air pollution, endangered species, or biodiversity. Publics that are generally sympathetic to such issues are often susceptible to concerns about climate change. But even publics that are not generally known for their environmentalism can put a high priority on solving climate change.

Frequently this arises from growing local evidence of the impacts of climate change: rising sea levels, coastal erosion, changing weather patterns, and frequent or intense storms. Personal experience with these changes may be supplemented by government reports showcasing the existing or potential impacts of climate change. Windows of opportunity, discussed above, also provide moments in time for climate change to jump into the public consciousness. Violent weather events such as Hurricane Katrina, media coverage of major climate summits or IPCC reports, and media events such as the release of Al Gore‘s documentary An Inconvenient Truth all lead to periods of time in which awareness and anxiety about climate change are heightened.

Climate change can also rate much lower on the priority list of some publics.

More traditional issues such as the economy and jobs, health care, national security, and education are often the top concerns, particularly in localities that have not experienced 70

any major impacts from climate change. They may view climate change as a hoax or a natural event that has little to do with human behavior. In such environments, policymakers may have difficulties justifying taking aggressive action on climate change.

Indeed, the pressure to deal with other issues may leave climate change either ignored or rolled into initiatives dealing with energy efficiency and other low cost, ―no-regrets‖ measures. We would be unlikely to see aggressive, comprehensive, or innovative action in this situation. It is much more likely that governments will ignore the issue, obstruct policy, or pass policies devoid of actual emission reductions such as creating voluntary greenhouse gas emission ‗goals‘, create commissions to study the issue, or act as observers of existing regional initiatives.

Returning our attention to Figure 2.6, we can see that the cost of transitioning and priority of climate change conspire to give us our four types of sub-national climate policies. We now turn our attention to them.

Climate Obstructionist: When the high costs of transitioning away from fossil fuels combines with a low priority of solving climate change, policy makers are likely to become Climate Obstructionists. This is characterized by policies designed to minimize emission reduction policies at home and abroad—either by ignoring the issue or by actively trying to prevent climate policies from being adopted.

A high cost of transitioning, as discussed above, creates high political costs for policymakers to adopt emission reduction policies. When the public has no vested interest in solving climate change, and indeed, may be opposed to doing so, the benefits of acting are also extremely low. In bottom-up environments, policymakers may simply 71

ignore climate change entirely as an issue. In top-down systems, however, the federal government‘s commitment to the Kyoto Protocol and pressure on sub-national governments to act makes ignoring the issue quite difficult. Therefore, policymakers are likely to stall and prevent substantial policy action. At the same time, they may actively campaign against climate action, arguing that the economic costs are high and the potential benefits low or even non-existent. As we shall see, stalling and outright opposition were both rampant in Alberta during its Obstructionist phase.

Climate Obstructionists are therefore unlikely to adopt any significant emission reduction policies. The policies they pass are likely to be few and designed to stall more aggressive actions. They will create climate commissions to engage in further study of the issue, or adopt voluntary emission goals. Indeed, mandatory emission reduction policies are not to be found in these states and provinces. These governments may also actively campaign against climate action at home or abroad, either by giving speeches denouncing action or adopting anti-Kyoto legislation.22

Climate Fruit-Picker: A Climate Fruit Picker results when the costs of transitioning are low and so is the priority of solving climate change. The policies that result are likely to be low-cost, ‗no regrets‘ measures that pose few costs to the government but still establish a climate-friendly policy record. In other words, these governments are

―picking the low hanging fruit‖ but not going further to adopt innovative or substantial climate change policies.

22 The Alberta premier campaigned actively against Kyoto; meanwhile, a dozen U.S. states adopted anti- Kyoto legislation indicating their intention not to consider emission reduction policies. 72

Unlike the Climate Obstructionists, Fruit Pickers are willing to consider emission reduction policies. The costs to adopting such policies are lower and thus more politically acceptable. However, there are still few benefits to adopting aggressive policies, as the public is more invested in non-climate issues and would prefer the government spend its time on those issues. The main benefits to acting, therefore, are from policymakers own interest in addressing climate change or a desire to claim a leadership mantle that can be touted to peers, the national government or the international community. The result is that the government may pass climate-themed policies but that these are likely to be low stakes efforts that incur few costs to implement locally.

Fruit Picker policies are therefore likely to focus on policies such as improving the energy efficiency of government buildings and fleets, or creating an inventory of local greenhouse gas emissions, a policy that enables future measuring of emission reductions.

Other popular policies include new efficiency standards for appliances or buildings which create cost savings over the life of the appliance or building. Fruit Pickers are unlikely to focus on stalling measures or obstructionist tactics and also usually avoid more aggressive measures such as mandatory greenhouse gas targets or renewable energy requirements.

Climate Innovator: When the cost of transitioning and the priority of climate change are both high, obstructionist behaviors give way to innovator behavior. Governments under these conditions begin to engage in policies on climate change. However, Innovators are not free to simply adopt aggressive and costly emission reduction policies like their

Crusader counterparts. Facing high costs of reducing fossil fuels, Innovators must find 73

ways to meet the public demand for action without ostracizing these powerful industries.

Innovators, therefore, are likely to experiment with policies that do more than just reduce emissions; that is, they will support policies that create opportunities for economic investment or jobs, decrease the risks to public health, solve other environmental problems, or address national security risks. Innovators, in short, do not have the luxury of simplicity or traditional policies: they must find measures that address the climate problem without aggravating political opposition. These conditions are therefore a breeding ground for innovative policymaking.

Climate Innovators are likely to focus on policies that address multiple problems connected to climate change. Policies may lead to direct emission reductions, but usually do not require the shutting down of any coal or oil facilities. Instead, they will focus on new methods of production—i.e., clean coal technologies—or ways to prevent the carbon produced from reaching the atmosphere. Other popular policies include renewable energy measures which allow policymakers to claim action on climate change, energy independence, and economic development opportunities.

Climate Crusader: A Climate Crusader is the likely result when the cost of transitioning is low and the priority of solving climate change is high. Crusaders are governments that are invested in solving climate change and therefore adopt comprehensive and aggressive policies on the issue. Like obstructionists, they take their viewpoint outside of their local boundaries and attempt to recruit other sub-national governments as well as the federal government to their side. With low costs for emission reduction policies and a public

invested in finding solutions, these governments are the best poised to experiment with multiple kinds of policies and find solutions worth exporting.

Climate Crusaders are the most likely to adopt aggressive and mandatory greenhouse gas emission reduction policies. They will take on substantial greenhouse gas targets, regulations to enforce them, and funding to sustain them. In addition, they are likely to create aggressive renewable energy commitments, establish cap-and-trade systems, and found regional initiatives. Moreover, these governments do not stop at local policy experimentation. Instead, they will market their policies outside their borders, traveling to other states and provinces as well as international conferences to share their practices. Unlike the Fruit Picker which may simply call itself a leader in climate policy,

Crusaders truly wear the leadership mantle and attempt to diffuse their policies to other actors.

In this section, we have explored in depth the differences in the top down and bottom up models of policymaking and why we expect them to produce different policy results. In particular, we have focused on a new framework for sub-national policymaking and a typology of climate policy choice. In the next section, we summarize our expected findings and the methodological approach to exploring them.

Expected Findings and Methodology

In this chapter we have established that while international organization is the usual recommendation of scholars and policymakers interested in solving global problems, climate change requires a different solution set. We explored two different 75

models of policymaking: a top-down system where sub-national policy is influenced by international and national policies; and a bottom-up system where sub-national policy is not bound by national commitments to an international regime. Exploration of these two models and their differing characteristics led us to create a Sub-national Climate

Policymaking Framework which explains how the two models connect and lead to policy. Finally, we established a new Climate Policymaking Typology which organizes the different policy outcomes into four overall categories of actors. Before moving on to the empirical examination of these models, we must first establish our expected findings and the methods we will use to confirm them. We do both in this section.

If he model presented has validity in the real world, we expect to observe the following characteristics in the cases. First, we expect to find a clear difference in sub- national policymaking in bottom-up and top-down systems. The interaction between federal and sub-national governments should be more overt and one-sided in top-down systems, while sub-national governments should be more autonomous in bottom-up systems. Likewise, local policy champions will play more of a role in bottom-up systems than they will in top-down systems. Second, we expect to find that policies in bottom-up systems differ substantially from top-down policies as established in Table 2.1. Top- down policies are more likely to be direct, short-term and less innovative than the indirect, long-term, more innovative policies found in their bottom-up counterparts.

Third, we expect the two conditions identified in the Climate Policy Choice Typology— the priority of climate change and the costs of transitioning to a fossil-fuel free economy—to be associated with their corresponding policy types: the Climate

Obstructionist, Fruit-Picker, Innovator, and Crusader. Finally, we hope to find evidence 76

that the bottom-up model of policymaking, while not strongly supported in either policy or scholarly circles, is a viable route to producing climate policy.

In the preceding sections of this chapter we have presented an overall framework of sub-national climate policy making as well as a typology of policy choice. We explore both through illustrative case studies in the United States and Canada. In this section, we introduce the method of analysis, the logic behind case selection and the data collection process.

The main tool of analysis is extensive process tracing of ―the causal mechanisms, or processes, events, actions, expectations, and other intervening variables, that link putative causes to observed effects‖ (Bennett & George, 1997). Using more than 70 in- depth, semi-structured interviews of government officials, bureaucrats, and stakeholders, analysis of government and international organization data, and secondary sources, I investigated the different approaches taken to developing policy on climate change from

1998-2008 in the United States and Canada and specifically in California, Ohio, Alberta, and Ontario. This allowed me to explore the way that the Kyoto Protocol impacted national policymaking in both countries and how the attributes of the top-down and bottom-up models influenced that process. Then I narrowed my focus to look at the process in particular states and provinces in order to explore the Climate Policy Choice

Typology. Alberta illustrates Obstructionist and Innovator behaviors while California illuminates the Climate Fruit Picker and Innovator types.

To illustrate the framework and typology I chose to examine the United States and Canada from 1998-2008. This ten-year period gives time for the priority of climate change to shift, allowing us to explore the impact of that variable. We begin in 1998 with 77

the ratification of Kyoto and end with the beginning of the commitment period during which those states bound to the Protocol must achieve their results. Using this time frame allows us to look at climate action before and after Kyoto ratification and over a time when concern about climate change was on the rise.

The United States and Canada therefore present us with interesting variation on the variables under examination. Sub-national governments in both countries run the gamut of climate policy, housing states that have completely ignored the issue as well as those viewed as international leaders in the area. All four policy types are well represented in the two countries. Furthermore, using two federal systems enables us to only look at cases where substantial policymaking autonomy at the sub-national level was possible. Yet the substantial differences in approaches to policymaking at both the national and sub-national levels in these different countries enable us to make some interesting comparisons between the top-down and bottom-up models.

Within the US and Canada the study focuses on one state and province, though in

Chapter 5 we expand the analysis to include multiple other states and provinces. I have selected cases that gave variation on the independent variables of cost of transitioning and climate change priority. In the United States we focus on California, a state known for its leadership on environmental issues, and in Canada Alberta is the illustrative province. In both states we hold the cost of transitioning constant, with low costs in

California and high costs in Alberta. The priority of climate change shifts in both governments, however, allowing us to evaluate the impact of a rising priority in two different cost environments over time. Meanwhile, expanding the cases to the other 49 states and 12 provinces and territories in chapter 5 allows us to understand the differences 78

between the top down and bottom up models outlined in the Sub-national Climate

Policymaking Framework.

The data used in the case studies includes dozens of interviews conducted in

Sacramento, San Francisco, Berkeley, Columbus, Oh., Washington, D.C., Edmonton, and

Toronto. Each interview was completed personally and confidentially by the author and lasted between thirty and ninety minutes. Subjects ranged from members of legislative assemblies and state senates to their staffs; officials in relevant bureaucratic institutions such as Ministries of the Environment, Natural Resources, and Energy; scholars at local universities and think tanks; public opinion and policy analysts; activists in non- governmental organizations; and local government officials.23 I supplemented the interviews with content analysis of official transcripts of debates and hearings in the legislative assemblies; legislation; official reports, statistics, white papers, and press releases from provincial, state, national and international governments; speeches by government officials; public opinion surveys; and newspaper articles.

Having explained the methodology underlying the forthcoming analysis, it is time to turn our attention to the case studies. In chapter 3 we explore the case of Canada with a focus on Alberta‘s transition from Climate Obstructionist to Climate Innovator. In chapter 4 we look at the United States and California‘s shift from Climate Fruit Picker to

Climate Crusader. Chapter 5 compares the two cases in the context of the overall framework presented in the current chapter. Chapter 6 offers some conclusions and avenues of further research.

23 See Appendix B for a list of interviews and their reference forms. 79

Chapter 3: Sub-national Climate Policy in Canada

In the previous chapter, we introduced the Sub-national Climate Change

Policymaking Framework and discussed the differences between the top-down and bottom-up models of policymaking. We also examined the Sub-national Climate Policy

Typology, which divides policy outcomes into four types of actors: Climate

Obstructionists, Climate Fruit-Pickers, Climate Innovators and Climate Crusaders. We ended the chapter by briefly summarizing our expected findings and outlining the methods we use to evaluate our claims.

In this chapter we turn our attention to the Canadian case, showcasing a classic

Top Down model of policymaking on Climate Change. In the first part of the chapter we examine national government actions on climate change and establish how Canada fits into this Top Down model. Then we examine the impact of this model on sub-national policymaking in Canada, focusing on two of our four policy types, both illustrated by the case of Alberta. We start with Alberta from 1998-2005, a clear example of the Climate

Obstructionist, producing commissions and action plans aimed at avoiding any real emission reductions in the province while also trying to prevent policymaking at the national level. Alberta changes course in 2006 to become a Climate Innovator as concerns about its future economic competitiveness rise.

National Climate Policy in Canada, 1992-2008

Before we explore the Top-Down process in Canada, it will be useful to establish

Canada‘s history with the problem of climate change. Canada hosted the 1988

Conference on the Changing Atmosphere in Toronto, where more than 300 scientists and policymakers from 46 countries and organizations met to discuss the ozone layer and climate change. The national government followed this meeting with a pledge to return

Canada‘s emissions to 1990 levels by 2000. This pledge would be reaffirmed in the

United Nations Framework Convention on Climate Change (UNFCCC) which called on all signatories to stabilize GHG emissions to 1990 levels by 2000. Paul Martin, a critic in the Liberal party, called the target weak and announced a 20% cut should the Liberal

Party take over Parliament. While the pledge was included in the official platform of the

Liberal government in the 1993 and 1997 elections, no significant action was taken while the government was in office. Emissions climbed and were 11% above 1990 levels by

1995 according to the Fourth National Report on Climate Change submitted to the UN

Secretariat (Government of Canada, 2006).

Federal-provincial cooperation was deemed necessary to implement the 1992 agreement in order to ensure that politically acceptable ideas were shared and discussed.

Carbon taxes, which were popping up in Scandinavia, were hotly debated by the government. A federal report jointly released by the ministries of Environment and

Finance in 1992 indicated that carbon taxes would be the most cost-effective option to address global warming (Geddes, 1992). However, several of the provinces vigorously objected, notably Alberta: former Premier Peter Lougheed called the idea

―discriminatory‖ (Canadian Press, 1994). By 1994, a federal carbon tax was ―off the 81

table‖ according to then Prime Minister Jean Chretien, though the policy enjoyed a resurgence of popularity the following decade when British Columbia implemented its own carbon tax (Corcoran, 1994). With carbon taxes off the table, the federal government provinces agreed in 1993 to the Comprehensive Air Quality Management

Framework for Canada. This led to the creation of the National Air Issues Steering

Committee and the National Air Issues Coordinating Committee which were given primary responsibility to discuss strategies for implementations of the UNFCCC.

Through negotiations within these bodies, where provinces were included, a national consensus was reached, focusing on voluntary measures and the involvement of developing countries in any future binding agreements.

By 1995 the participants in the UNFCCC agreed that the voluntary reductions were not sufficient to see real change and agreed to pursue a binding Protocol. Canada was at the forefront of these negotiations. During the lead up to the Conference of the

Parties at Kyoto in 1997, there was an extensive consultation process with the provinces.

While the national government has the right to sign international treaties, the provinces own the natural resources and therefore govern their use. The federal government therefore knew that the provinces needed to be on board with any eventual agreement.

The consultation resulted in a consensus: As Environment Minister Christine Stewart announced just weeks before Kyoto: Canada would be willing to commit to reducing greenhouse gas levels to 1990 levels by 2010.

Canada‘s initial proposal at the Kyoto meeting, however, bore little resemblance to the agreement with the provinces: Canada proposed that developed countries reduce emissions to 3% below 1990 levels by 2010 and 8% by 2015. Canada would further 82

commit to reaching 1990 levels by 2007—three years ahead of the date the provinces had agreed to. And under the final agreement, Canada committed to a 6% reduction over

1990 levels by 2012. The provinces felt betrayed: ―The Kyoto commitment was far beyond the position of the federal, provincial, and territorial energy and environment ministers had agreed to in November 1997‖ (Smith, 1998). Witnesses to the negotiations agree that this increased commitment was largely bravado, trying to match the United

States—who, under Vice President Al Gore, committed to a 7% reduction target-- in its commitment to the cause (Interview with Kyoto delegate). Others argue that the federal government was influenced by a desire to be a good international environmental citizen and avoid being seen as an international laggard, as well as keeping up with the

Americans.

Shortly afterward, Chretien created the National Climate Change Process

(NCCP), a joint federal-provincial-territorial roundtable to determine how implementation of the Protocol should proceed. Extensive modeling conducted through this process revealed that ―Canada could meet its Kyoto commitments with little negative economic impact‖ (Suzuki 2005). The federal government released a report during this time identifying two crucial conditions for determining how Canada would meet its

Kyoto obligations:

1. The plan must not ask any region of the country to bear an unreasonable burden.

2. Any plan must be developed in full consultation with the provinces and other stakeholders.

A modest Action Plan 2000 was produced, calling on Canada to reduce emissions by 65 megatons—far less than the 240 required by Kyoto. By the end of 2000, emissions were at 21% above 1990 levels (Environment Canada, 2007).

The federal government launched a new plan in 2002, the Climate Change Plan for Canada, now promising actions that would produce 180 megaton reduction—still short of the 240 megatons required by the Protocol. Five specific instruments received the most attention: reduction targets for industries; a partnership fund with the provinces and territories; strategic infrastructure investments; an innovation strategy; and incentives and regulations. Significant amounts of money were put aside for implementation of these action plans—more than $3.7 billion between 2000 and 2004 (Leahy, 2006).

However, the spirit of cooperation with the provinces had almost completely broken down by this point. Alberta resigned its co-chairmanship of the NCCP when the federal government announced that the negotiations would be consultative only, with final decisions made entirely by the federal government (Interviews with Alb. Environment official 1, Alb. Energy official 2). Meanwhile, emissions continued to grow—they reached 25% above 1990 levels by 2003 (Environment Canada, 2007).

Meanwhile, national debate over the ratification of the Kyoto Protocol began in earnest. Key concerns of the opposition focused on the economic costs of compliance and the lack of commitments required of the developing world, notably India and China.

Thomas d‘Aquino, President and Chief Executive of the Canadian Council of Chief

Executives wrote to the Prime Minister, ―ratification of the Protocol, given the commitments that will be required of Canada, may prove to be one of the most catastrophic public policy decisions of our country.‖ 84

Similarly, Alberta vigorously opposed Kyoto ratification, launching a media campaign, threatening legal action, and introducing its own climate plans and legislation in defiance of the federal government. Premier Ralph Klein sent an open letter to the

Prime Minister arguing against ratification, and calling for a ―made-in-Canada approach to climate change…that would achieve the intent of the Kyoto Protocol, but on different timelines and in ways that would not hurt the national economy or individual Canadian‘s jobs‖ (Klein, 2003). British Columbia premier Gordon Campbell agreed. A statement from his office said about the accord, "The initial figures suggest that to implement it, it will cost British Columbians $300 per person, per year. Even in the most favourable situation, it would mean the loss of thousands of jobs.… British Columbia will be one of the provinces that will hurt the most if this goes through. It‘s not fair‖ (Copeland 2002).

Despite these objections, and with the support of environmental groups and the

Liberal party, Chretien signed the ratification documents presented by the legislature on

December 17th, 2002 making Canada the 100th country to join the Kyoto Protocol.24

The OECD evaluated Canada‘s environmental performance in 2004, and noted that its record on climate change was exceedingly poor, relying largely on voluntary programs and incentives. The report ranked Canada as 28th out of 29 OECD nations on

25 environmental indicators, and 27th out of 29th on climate change (Organization for

Economic Co-operation and Development, 2004). They recommended emission taxes— which did not find a place in the new Action Plan produced in 2005, which continued the trend of voluntary incentive programs.

24 The protocol would not take effect until 2005, however, due to the stringent requirements regarding the Kyoto Protocol‘s entry into force: 55% of the members representing at least 55% of global emissions needed to ratify before the Protocol became part of international law. Russia provided the final ratification in 2004. 85

In January 2006, Stephen Harper, a Conservative from Alberta, became Prime

Minister and announced that the Kyoto Protocol was no longer one of Canada‘s priorities.

Having previously claimed that "Kyoto is essentially a socialist scheme to suck money out of wealth-producing nations‖ (―Harper‘s letter,‖ 2007). Harper moved quickly to slash funding for climate change programs from the federal budget and declared the

Kyoto commitments ―impossible‖ to achieve (Struck, 2006). International backlash to this position was fierce, since at the time Canada was chairing international meetings on the Kyoto Accord. Domestic opposition also spiked as public opinion indicated that most

Canadians supported the Kyoto Protocol. A 2006 poll found that 57% of Canadians believed climate change to be a ―very serious‖ problem—an increase of 17% since 2003

(World Public Opinion, 2006). Angus Reid polls in 2006 and 2007 indicated that 60% of

Canadians were opposed to emission intensity targets and supported Canada‘s continued membership in the Kyoto regime (Angus Reid Strategies, 2006 & 2007). Within a year,

Harper retreated and declared that climate change was "perhaps the biggest threat to confront the future of humanity today‖ (Bramley, 2008).

In 2007, the Canadian government released Turning the Corner, its new GHG reduction plan. The plan calls for reducing Canada‘s total GHG emissions by 20 per cent based on 2006 levels by 2020 and by 60 per cent to 70 per cent by 2050 (Environment

Canada, 2008). This represents approximately a 25 megaton increase over what emissions would have been had Canada met its 6% Kyoto target by 2012. In addition, there are several loopholes built into the plan for industry to reduce the economic impact of the absolute target. First, the use of 2006 as a baseline year, abandoning the 1990 standard used in Kyoto, gives significant breathing room to high emitters. Another 86

potential loophole is the use of intensity targets for industries—requiring that their use of emissions become more efficient, rather than be reduced by an absolute amount. A final loophole is the existence of the Tech Fund. Companies are allowed to meet as much as

70% of their commitments by donating money to this fund at the rate of C$15/ton of carbon.25 The money will be set aside for research into new emission reduction technologies. These loopholes may partly be responsible for Canada‘s current position on climate policy: the government‘s own report to the United Nations in April 2009 showed that Canada‘s emissions have increased more than any other G8 country since

1990: 26% above 1990 levels (Environment Canada, 2007).

As this history relates, Canadian policymaking clearly followed a top-down path from the signing of Kyoto in 1997 until 2006, when new Prime Minister Stephen Harper declared that Canada would not fulfill its Kyoto obligations and that any new policy would focus on a ―made-in-Canada‖ solution to global warming. This period was characterized by consultations, incentive programs and regulations to elicit provincial action on climate change.

We can adapt the general model of Chapter Two to the Canadian case, as shown below in Figure 3.1.

25 Experts argue that in order to achieve real reductions, the cost of carbon needs to be closer to $30/ton. See Fickling, 2009. 87

Kyoto Protocol

Ratification

Canada

Commitment to 6% Reduction

Other Alberta Ontario Provinces

Figure 3.1: Top Down Policymaking in Canada

When Canada ratified Kyoto in December 2002, this committed the country to reaching a 6% reduction from 1990 levels of greenhouse gas emissions by 2012. It was clear from the moment of signing—indeed, from the consultations leading up to Kyoto-- that the provinces would be expected to do their part to meet this international commitment: as Chretien said then, ―the provinces will play a role…and things will have to change.‖ The debate had shifted, Environment Minister David Anderson pointed out, from ―whether we should ratify‖ the proposed commitments to ―how we do it‖

(Paraskevas, 2002). For the next four years under Chretien and Paul Martin, the federal government would persist in pushing the provinces to take action on climate change to meet Canada‘s commitments. As we shall see, this top down process had clear implications for policymaking in the provinces.

Canada clearly illustrates the case of a top-down system for climate policymaking. The national government participated in the negotiations leading up to the

Kyoto Protocol, ratified the accord, and directed its provinces to fulfill its international commitments. The provinces, however, have responded to this pressure in varied ways.

Indeed, the provinces differ substantially from each other in terms of their response, in both their commitment to addressing climate change and the policies they have adopted.

In Chapter Two we discuss two variables that help us understand why some provinces have engaged in aggressive emission reductions and others have virtually ignored the issue despite pressure from fellow provinces and the federal government. These two variables are the level of priority climate change has in the province and the cost for the province to transition to a non-fossil fuel based economy. The result is our Sub-national

Climate Change Policy Typology, which establishes four types of policy actors: the

Climate Obstructionist, Climate Fruit-Picker, Climate Innovator, and Climate Crusader.

They are illustrated in figure 3.2. The case of Alberta from 1998-2006 serves as an example of a Climate Obstructionist, while Alberta from 2007-2008 illustrates the

Climate Innovator.

Climate Obstructionist: Alberta, 1998-2006. In a top-down environment when climate change is a low priority for policymakers and transitioning away from a fossil fuel-based economy is costly, governments are more likely to stall and obstruct policy rather than produce substantive solutions to climate change. The government cannot ignore the issue completely, as pressure from the federal government and fellow provinces will ensure it a place on the agenda, but we would expect to see the illusion of solutions rather than the 89

reality of it. Additionally, even this low level action is taken reluctantly, as the government will attempt to stymie any attempts at producing aggressive policy. The government is likely to issue numerous reports and plans, or adopt ‗voluntary‘ targets but is unlikely to commit to any substantial action or devote resources to proposed policies.

Low Priority for High Priority for Climate Change Climate Change

High Cost of Transitioning Climate Obstructionist Climate Innovator to non-Fossil Hypothesis Hypothesis Fuel Economy Alberta 1998-2006 Alberta 2007-2008

Low Cost of Climate Fruit-Picker Climate Crusader Hypothesis Transitioning Hypothesis to non-Fossil California 2006-2008 Fuel Economy California 1998- 2005

Figure 3.2: Sub-national Climate Policy Typology

Climate Innovator: Alberta, 2007-2008: When climate change is a high priority but there is also a high cost of transitioning the economy, governments will seek out innovative solutions to climate change that accommodate local needs and resources. These governments face a tough situation: they must accommodate the desire of the public, environmental, and even industry groups for substantive climate policy while ensuring economic growth—a tricky thing to do when the best climate policies call for reductions in the very emissions that serve as a measure of economic growth. In the case of Alberta, 90

in 2007 the province came under substantial pressure for its opposition to climate change, resulting in numerous threats of boycotting Albertan oil. These threats to the Albertan economy were taken very seriously, and suddenly climate change became a top priority in the province on economic grounds. Rather than engaging in dramatic emission cuts like a Climate Crusader, however, the province devoted substantial resources (more than

$2 billion) to developing carbon capture and storage expertise—allowing it to continue oil production while preventing emissions from reaching the atmosphere. An innovative solution, and the reason why Alberta from 2007-2008 stands as an interesting illustration of a Climate Innovator.

In the next two sections, we will explore how Alberta transitioned from a Climate

Obstructionist to a Climate Innovator.

Alberta 1998-2006: The Climate Obstructionist

Alberta, Canada, is an unlikely candidate for strong climate change policy. Best known by outsiders for its expansive oil sands, Alberta is a top energy supplier to North

America, supplying more than half of the United States‘ natural gas supply (Government of Alberta, 2008). Although the province contains only 10% of Canada‘s population, it is responsible for more than one third of the country‘s greenhouse gas emissions. When

Canadians speculate about which provinces will respond quickly and strongly to environmental issues, Alberta rarely makes the list.

Alberta until 2006 represents an interesting example of a Climate Obstructionist.

According to this policy type, when climate change is a low priority and the cost of transitioning away from reliance on fossil fuels for energy is high, governments will 91

engage in stalling and obstructionist tactics, passing policies that on the surface address climate change but in reality do little to lower emissions. We expect to find such governments at most drafting numerous reports and creating climate commissions, publishing recommendations, and adopting policies that focus on voluntary action. They are also likely to actively campaign against climate change.

As we shall see, Alberta from 1998-2006 is a clear candidate for obstructionist behavior. Addressing climate change was a low priority for the public and the government, creating few incentives for policymakers to make a serious effort at producing emission reductions. The cost of transitioning away from fossil fuels was also very high for this province that relies on oil and gas production for its government revenues and exports. This created serious disincentives for politicians to adopt measures that would lead to losses in jobs, economic growth, and competitiveness (Thompson

2006, pg. 14). If Alberta was located in the United States, and thus free of the Kyoto commitment, it would likely have fallen in with the states that have taken virtually no action on climate change. But as part of Canada, and therefore subject to the top-down imposition of the Protocol, Alberta could not simply ignore climate change entirely.

Instead, it adopted policies that stalled legitimate and aggressive actions on climate change and attempted to obstruct any more substantial policy options.

As we shall see, Alberta‘s status as a Climate Obstructionist results from two key variables: its low priority of climate change and the high cost for its economy to transition away from dependence on fossil fuels.

Priority and Cost in the Climate Obstructionist

The first variable is the level of priority of solving climate change. Addressing climate change is not a top priority in Alberta, creating few political incentives for policymakers to consider costly and potentially unpopular measures to address the issue.

The issue is clearly not a top priority for the public, who rank education and health care as much more important government concerns. Furthermore, a conservative culture and lack of experience with the potential impacts of climate change leaves many Albertans with a healthy skepticism of climate change‘s existence—a barrier to any attempts to issue policy in the area. Finally, Albertans do not tie climate change to other issues that they do value—such as economic opportunities, health care, or even other environmental issues (such as water scarcity, extreme weather events, or air pollution). Lacking either an intrinsic importance or connection to other salient issues, climate change proves poor fodder for policymakers looking to create aggressive policies on issues their constituents care about. Indeed, the attitude about climate change creates a rich feeding ground for the obstructionist behavior we expect to find in Alberta.

A September 2004 poll of 258,000 Albertans conducted by the government revealed that the top issues in the country were health care and education, with environment a distant third (Alberta Finance, Statistics, 2004). In ranking the priorities,

57.7% said that ‗protecting Alberta‘s environment‖ was one of their top priorities, compared to 75.4% who wanted to ―provide an outstanding education system‖ and 84% who wanted to ―provide a quality, affordable Alberta health care system.‖ When respondents were asked where any government ―windfall‖ money should be spent, only

3.9% of respondents mentioned the ―environment,‖ compared to 6.8% who mentioned 93

―infrastructure‖, 10.5% for ―reducing taxes‖, 19% for ―health care‖ and 15% for

―education‖. Clearly, climate change is not the first area of concern when spending money is considered; indeed, as a 2002 poll showed, support for action on climate change dries up when respondents are asked about paying costs to stop global warming. Strategic

Counsel pollster Michael Sullivan sums up the attitude: ―if it comes at an economic cost to me, personally, then you see support just evaporates….it suggests that we talk a good line, but if its going to cost us anything, we back right off‖ (Jaimet, 2002).

One reason why climate change is a low priority in Alberta is a dominant conservative culture and a population with a healthy skepticism of the existence of climate change. If the population does not believe there is a problem, then policymakers are unlikely to adopt costly legislation that attempts to solve it. Albertans are generally conservative in their political opinions, more so than any other province. In 2001, the

Progressive Conservative Party won 74 out of 83 seats in the Alberta Legislative

Assembly, getting 61.9% of the vote. In the federal election in 2004, the Conservative

Party took 26 of the 28 seats for Alberta. The party is strong in British Columbia and

Saskatchewan as well, but only won 36% and 42% of the vote in those two provinces, respectively. It is clear that ―there is a strong, homogeneous cultural and religiously conservative base in Alberta. It is very hard for people here to accept a human impact on natural events‖ (Interview with Alberta scholar).

This culture creates a healthy skepticism about climate change—not just whether the causes are anthropogenic, but whether it is happening at all. A 2002 poll found that

―Albertans are the most ardent skeptics of climate change…in the country‖ (Jaimet,

2002). Only 48% accepted the view that ―the use of fossil fuels in cars and factories is 94

causing global warming through a buildup of greenhouse gases in the atmosphere.‖

Elsewhere in Canada, the average was 67%. Even the effects of climate change are disputed in Alberta. One MLA discussed the retreating of glaciers along the Banff-Jasper highway in Alberta: ―You can walk up to one signpost that states 1930 or 1935, and you‘ve almost got to walk a kilometre before you can get up to the current time‖ (Alberta

Hansard, April 18, 2002, pg. 810). The Environment Minister, to whom this anecdote was posed, did not respond at the time. Months later, another MLA would comment that while some glaciers are retreating, others are growing, arguing that the glaciers could not be used as evidence of global warming. One MLA put it succinctly, saying ―our activity on this planet is not the major contributing factor to global warming‖ (Alberta Hansard,

November 27, 2002, pg. 1599). With many policymakers refusing to accept that there is a man-made fix to global warming, it is easy to see why the issue is not at the top of the political agenda.

Another reason why climate change is a low priority in Alberta is that it has not been tied to other issues that are more salient, such as health care, economic opportunity, or other environmental problems. While the potential for climate change to cause health problems proved a catalyst in Ontario, the connection is dismissed in Alberta. During an oral question period at the Alberta Legislative Assembly in November 2002, Dr. Taft, the

MLA for Edmonton-Riverview and a member of the Official Opposition to the reigning

Conservative party, noted the connection between climate change and health. He argued that a surge of deaths in Ontario from West Nile Virus could be directly attributed to changes in the climate of Canada that led to a more northerly migration pattern for virus- carrying insects. The Minister for Health and Wellness, when asked by Taft whether any 95

attempt had been made by the government to measure the health impacts of climate change, replied that climate change was not an issue of concern for his department which was dedicated to more realistic health threats (Alberta Hansard, November 20, 2002, pg.

1414). Clearly, issues of health and climate change are separated in Alberta.

Likewise, economic opportunities are not tied to climate change. The official record of the Legislative Assembly, the Alberta Hansard, contains hundreds of pages of discussion on climate change, and the economic opportunities of climate change are mentioned on only a handful, briefly, and then only by the opposition. The 2002 debate on the Kyoto Protocol in particular is full of descriptions regarding the potential economic costs of climate change, but rebuttals largely argue that the costs are either not that high or else are worth paying—not that the Protocol presents any economic opportunities. For example, Ms. Carlson, the MLA for Edmonton-Ellerslie, tackled the government assertion that ratifying Kyoto would lead to a loss of 450,000 jobs in Alberta.

Carlson calls this ‗propaganda‘ and argues that the actual loss of 60,000-120,000 jobs, and even that these jobs will be postponed. ―We‘re not talking about your neighbor losing their job or you losing your job. We‘re talking about that guy coming in from out of the province who is going to have to wait another six weeks before he gets a job in this province‖ (Alberta Hansard, November 26, 2002, pg. 1544). Nowhere in her long discussion of this issue does she mention that jobs could be created in the province if

Alberta pursues new fields in alternative energy, an idea that would be later touted in the

2008 climate action plan.

Even other environmental issues are dismissed from the climate change discussion. Environmental Minister Taylor, when addressing the Assembly, frequently 96

mentioned that Kyoto would do nothing about the ―brown smog‖ in Ontario. He said,

―Its quite clear that Kyoto is about greenhouse gases, 98 and a half percent of which is carbon dioxide. Carbon dioxide is not a pollutant.‖26 Indeed, this disconnect is shared by the Albertan public: while 57.7% of Albertans may support protecting the environment as the earlier poll indicated, 72% of Albertans in 2002 wanted the Canadian government to withdraw from the Kyoto Protocol (Alberta Hansard, November 19, 2002, pg. 1379).

Other environmental issues that came before the Assembly—such as water scarcity and extreme weather events—were rarely connected to climate change, or else—as in the case of one discussion of tornadoes—were dismissed out of hand as bearing no relevance on the conversation (Alberta Hansard, November 19, 2002, pp. 1467-8).

Media editorials in Alberta‘s newspapers confirm that global warming is an issue to be ignored or fought against. One 2004 editorial in the Calgary Herald doubted the science of climate change, calling carbon dioxide ―a so-called greenhouse gas alleged to be responsible for climate change (Cooper, 2004)‖. An editorial in the Edmonton Journal notes that the science is ―skimpy on global warming‖ and that studies supporting action use questionable scientific methods to create their conclusions (Gunter, 2004). Further editorials in both papers argue against government action on climate change.27

As chapter 2 discussed, it is crucial for invested actors to link climate change to other issue priorities if they want to see aggressive action on climate change, particularly if intrinsic support for the issue is low. In Alberta, climate change was viewed with skepticism by the general public and many legislators, with even the Minister of the

26 At the time, carbon dioxide was classified as a pollutant in the United States and therefore subject to regulation by the Clean Air Act. It was taken off the list of pollutants in 2003, and then returned to the list in 2008. 27 See, for example: Stanway, 2004; ―The Price,‖ 2004; ―Undeterred,‖ 2004. 97

Environment doubting the science behind global warming. Intrinsic support for action was therefore low, but could have been overcome had climate change policy found an outlet through other, higher priority issues. But in Alberta the issue was separated entirely from other issues of importance, such as health care, economic growth, and even air pollution. Instead, climate change was largely viewed as an issue thrust upon the province by the federal government that would lead to substantial and disproportionate costs for Alberta. The perceived costs of lowering emissions to address climate change were also high enough to further restrain action in Alberta.

The second variable influencing Alberta‘s policy type is the high cost of transitioning away from economic dependence on fossil fuels. ―Kyoto will mean economic ruin in this province. Some Albertans believe that Kyoto will only hurt the energy sector. Nothing could be further from the truth. Kyoto will affect all parts of the

Alberta advantage, right down to the family-owned corner store. If we allow Kyoto to drive business from Alberta, it means fewer jobs. It means less money in the pockets of

Albertans‖ (Alberta Hansard, November 27, 2002, pg. 1579). Alan DeLong,

Conservative MLA for Calgary-Bow, sums up the widely held view in Alberta that the cost of reducing greenhouse gas emissions is simply too high. As Canada‘s highest emitter, producing 31% of Canada‘s overall emissions, and largely responsible for the

35% increase in Canadian emissions between 1990 and 2004, Alberta more than any other province would be charged with the task of reducing Canadian emissions under the

Kyoto regime (United Nations Development Programme, 2007a). This high cost manifests in four ways: in overall cost to GDP, in lost jobs, in a loss of comparative 98

advantage vis-à-vis non-participating countries, and in an overall inability to transition to a fossil-fuel free economy.

In terms of overall costs to Alberta‘s GDP and economic growth, the picture painted in the Alberta Assembly is dire. One MLA claimed:

If we slow global warming by 2/10 of one degree, Mr. Speaker, we may save a

few lives around the world, but if we slow human development, if we slow the

expansion of health care, if we slow the advancement of education, and if we slow

the advancement of technology, then the human cost will be vastly higher than

any theoretical cost from a marginal increase in global warming. (Alberta

Hansard, November 26, 2002, pg. 1547)

The Minister of Economic Development, Mark Norris, echoed the argument that addressing global warming would cause more problems than it would solve. ―It has the ability of devastating the Alberta economy…not only for this generation but for our kids and their kids‖ (Alberta Hansard, March 13, 2002, pg. 315). Environment Minister

Lorne Taylor attempted to quantify this devastation. ―The price to Alberta…will be someplace between $2.9 billion and $5.5 billion, and that‘s a conservative estimate‖

(Alberta Hansard, March 7, 2002, pg. 196). Alberta‘s GDP in 2001 was approximately

$123 billion, leading to a direct cost of approximately .5% of GDP. However, warnings about the economic cost did not stop at direct cost to GDP. A survey of fifty-three senior analysts and portfolio managers completed in fall 2002 by the Investment Dealers

Association of Canada showed that 90% of respondents said ratifying Kyoto would hurt the energy sector. ―Strong majorities of analysts believe the treaty would impact the 99

industry and the Canadian economy negatively and could spur a re-evaluation of Wall

Street‘s investments in Canadian energy producers‖ (―Martin backs,‖ 2002). As the energy sector is the single largest contributor to provincial revenues, the government has a large stake in ensuring the continuing development of Alberta‘s natural resources.

Investments in the oil sands alone were expected to top $40 billion in the years following

2002‘s ratification debate…and cutting emissions certainly meant limited development of the oil sands (Alberta Hansard, April 17, 2002, pg. 770).

A second area of high cost to Alberta is in the loss of jobs. In a letter to Prime

Minister Jean Chretien during the Kyoto ratification debate, Alberta Premier Ralph Klein indicated that the danger of reducing emissions extend beyond the overall economy. ―The

(Kyoto) commitment…will have little discernible impact on global warming, but will result in the unnecessary loss of thousands of Canadian jobs, and an overall slowdown in

Canadian economic growth.‖ Others tried to quantify this potential loss. The Canadian

Manufacturers and Exporters Association estimated a potential loss of 450,000 jobs for

Canada as a whole, while Environment Minister Taylor was more focused on Alberta, claiming, ―we know that it will cost Alberta someplace between 40,000 and 70,000 jobs

(Alberta Hansard, Februaru 27, 2002, pg. 13). While some of these statements may simply be strategic bluster on the part of politicians, the fear of job losses amongst the public was considerable. In fact, ―one in six workers in Alberta is associated with the energy industry. Every family is affected by it‖ (Interview with Alberta scholar; confirmed by Alb. Energy official 1). Any policies that called for downsizing the

100

production of natural gas and crude oil would hit close to home for every family (and voter) in Alberta.

A third area of high cost to Alberta is the potential loss of competitiveness for its economy. The Kyoto Protocol provides an out for those industries that are unable to meet their reduction commitments: they can buy permits from those companies that surpass their own requirements. With an economy that relies heavily on the production of fossil fuels, and an inability to cut down on emissions lest GDP, government revenue, and job loss be too great, Alberta would likely have to buy permits. This would be a disadvantage for Alberta‘s competitiveness both in Canada and outside, as these companies must increase their prices to cover the cost of the emission permits. As the

Minister of the Environment said,

I‘ll tell you who has to buy those (permits): major industrial plants, of course,

which Alberta has plenty of in Fort Saskatchewan, Joffre, and other places in the

province; oil sands operations—who else in Canada has oil sands operations?—

petroleum refineries and electrical generators. These emission credits…will be

bought on an international market by these companies…We compete with

Mexico, whose (prices) will not be increased; we compete with Venezuela and the

US, whose (prices) will not be increased. (Alberta Hansard, March 7, 2002, pg.

196)

Indeed, Canada is the only country in the Western Hemisphere subject to the Kyoto

Protocol. It is also the only member of NAFTA to be bound to emission reductions:

Mexico was never given any targets and the United States refused to ratify the Kyoto 101

accord. Since 81% of Canada‘s exports head to the United States, there was a considerable fear of damage to the economy and Canada‘s competitiveness by those who protested Kyoto‘s ratification.28 Indeed, many viewed the Kyoto Protocol as nothing more than a wealth transfer, from Alberta to the rest of Canada and from Canada to the developing world. As one MLA asked, ―Why should we pay a royalty to Russia for the purposes of producing oil and gas here?‖ (Alberta Hansard, April 17, 2002, pg. 629).

A fourth and final area of cost for Alberta is in its ability to transform its economy to one that does not depend on fossil fuels. One senior official at Alberta Environment pointed out that, ―It is easy for Quebec with its rivers to be green, and use hydropower, but not so much for Alberta.‖ Table 3.1 outlines the production of energy in Alberta.

Coal and Natural Gas, both producers of greenhouse gases, account for 87% of Alberta‘s energy. Hydro power, which is responsible for 95% of Quebec‘s energy, is only 7% of

Alberta‘s total. To replace all of Alberta‘s power generation with wind power, a cleaner alternative, would require building approximately 34,000 windmills in the province

(Alberta Hansard, November 26, 2002, pg. 1519). Such a venture would be both expensive and unnecessary in the short term, as the oil reserves are expected to flourish for at least another twenty years (Alberta Hansard, April 10, 2002, pg. 625).

28 One estimate claimed that only 8% of Canada‘s trade would be with Kyoto-compliant countries. 102

Table 3.1. Alberta Sources of Electricity, 2008

Energy Source Megawatts Produced Percent of Total

Coal 5,919 47%

Gas 5,014 40%

Hydro 900 7%

Wind 525 4%

Biomass 184 1.5%

Fuel Oil 13 .5%

Totals 12,555 100%

Data acquired from Alberta Energy, energy.gov.ab.ca

In addition, Alberta would be unlikely to benefit from any kind of Canadian

―bubble‖ arrangement. The European Union agreed to an overall 8% cut in the Kyoto

Protocol, but member states adopted widely different individual targets depending on their resources and their ease in cutting emissions. Germany and the United Kingdom, for example, took on steeper targets, while some countries, such as Portugal, were allowed to increase their emissions to accommodate growth. If Canada adopted a similar approach, it would be likely to hurt Alberta: as the highest-emitting province, Alberta would probably have to carry a high share of the reduction burden, while other provinces could piggy-back on its efforts. Burden-sharing, therefore, would likely hurt Alberta more than it would help the province.

These four areas of costs add up to one argument: the cost of cutting emissions and transitioning to a non-fossil fuel based economy was extremely costly in Alberta. 103

Loss of GDP and jobs, a decreased competitiveness for Albertan companies, and a resource distribution that favors the use of coal, oil and natural gas all posed substantial challenges to Alberta. Coupled with a low priority in addressing climate change, and we expect to find Alberta stalling on policy and obstructing progress. As we shall see in the next section, this is exactly what has happened.

Policy in Alberta

In this sub-section, we will examine Alberta‘s approach to addressing climate change in its 2002 plans and legislation, and then explain how these policies represent the stalling and obstructionist tactics we would expect from a province facing a low priority for climate change and high costs of economic transition.

Alberta‘s policy consists of two general components: greenhouse gas intensity targets and establishing stakeholder networks. The cornerstone of Alberta‘s policy on climate change is its greenhouse gas emissions target. In its 2002 Taking Action Plan and the 2003 Climate Change and Emissions Management Act, Alberta adopted a goal to reduce its greenhouse gas emissions by 50% below 1990 levels by 2020. This direct policy response would have been one of the most aggressive commitments on climate change in the world except for one crucial feature: rather than an absolute cap or target for emissions, Alberta agreed to reduce the intensity of its GHG emissions. These targets set a maximum allowable intensity relative to some measure of output or input, usually

GDP (Ellerman & Wing, 2003). While these kinds of targets can lead to improved energy efficiency, they can present problems when GDP grows: intensity can decrease but absolute emissions may still increase. To stabilize greenhouse gases, the rate of intensity 104

decline must equal the rate of growth in GPD (Kolstad, 2005). Alberta‘s target is not pegged to GDP growth, and therefore actual emissions may actually increase as the economy grows (The Pembina Institute, 2007; National Resources Defense Council,

2005). For example, from 1990 to 2004 Canada reduced its emission intensity by 6% overall—but still experienced a 13% increase in emission output (Natural Resources

Canada, 2006). The Pembina Institute projects that Alberta‘s emissions, based on its targets, will result in a 20-25% increase above 1990 levels by 2020 (Fickling 2009).

Indeed, as the goal is entirely voluntary, there is no guarantee that even emission intensity will decrease.

The second feature of Alberta‘s climate policy focuses on establishing stakeholder networks for the government to consult with regarding climate change. In March 1994, policymakers created the Clean Air Strategic Alliance, a multi-stakeholder non-profit organization, and tasked it with developing recommendations for climate change action.

Much of its work focuses on what individual Albertans can do to improve air quality, with climate change being one component of that mission (Clean Air Strategic Alliance,

1999). Stakeholder networks were more firmly linked to climate change via the creation of Climate Change Central, a public-private partnership established in 1999 ―that empowers Albertans to take action on climate change through consumer rebate programs, demonstration projects and educational outreach‖ (Climate Change Central, 2009). Both of these organizations are made up of concerned individuals in industry, environmental groups, and government, and are frequently used by policymakers as talking points to prove that the government is taking action on climate change. They do serve as important consultants in the policymaking process, however. 105

These policies fit our expectations for a province that does not view addressing climate change as a top priority and faces a high cost of transitioning away from its reliance on fossil fuels. These policies represent Alberta‘s efforts to stall, obstruct, and minimize policies that would require emission reductions. Let us consider these policies in light of these three categories.

Stalling Action on Climate Change: Alberta‘s policy is designed to forestall significant action on climate change. By creating action plans and stakeholder networks, the provincial government could show the federal government and other provinces that it was taking action without actually reducing emissions. Alberta could therefore tout its climate credentials without political backlash inside the province from a public that did not support costly action on the issue. This stalling has manifested in Alberta creating legislation and policy documents that promise a lot but deliver very little, and then using these laws and documents to prove that Alberta is proactive on the climate change issue.

For example, during the negotiations on the Climate Change Emissions and

Management Act, The Environment Law Centre pointed out that the bill was actually unnecessary: a tested framework was already established through the Environmental

Protection and Enhancement Act, and the main features of the proposed Act could be accomplished through that vehicle (Chiasson, 2003). This recommendation was ignored, largely because the government wished to treat climate change as a separate issue. One official involved in writing the legislation argued that ―it was important to the government and the Premier that they be seen as taking action on this issue separate from the feds‖ (Interview with Alb. Environment official 2). The Act could be referred to as 106

the first of its kind, and was available as a talking point for policymakers eager to stave off federal demands for more stringent action.

But the Climate Change Emissions and Management Act did create new policy.

As discussed in the next section, these policies were not designed to actually produce emission reductions, however. It is unlikely that the Act would have passed at all if

Albertan policymakers were not eager to show the federal government that they could create a ―Made-in-Canada‖ response to the Kyoto Protocol, and thus avoid having to do their share to fulfill Canada‘s emission reduction commitment (Interview with Alb.

Energy official 1).

Alberta also mastered the ability to produce reports and plans that outlined future intentions without establishing clear policies for those intentions. These publications also provided the illusion of action without actually requiring emission reductions or other costly ventures. The best example of these types of plans is the 2002 climate change plan called Taking Action.

Taking Action does not require much action! There are seven key areas for

‗action‘:

 Emission Reductions

 Technology and Innovation

 Carbon Management

 Energy Conservation

 Renewable and Alternative Energy

 Storing Carbon

 Adapting to Climate Change 107

This list tells us little about actual policies, but a thorough read of the plan reveals that few concrete actions are taken. The government outlines a goal, rather than a binding commitment, to ―cut emissions in the province relative to GDP by 50 per cent below 1990 levels‖ by 2020 (Government of Alberta, 2002, pg. 2). This goal is further watered down by the inclusion of the phrase ―relative to GDP‖. The government is only committing to lower the business-as-usual emission rates and not emit as much in the future as they might have in the absence of this goal. There is no promise to actually reduce current levels of emissions.

The rest of the plan makes no concrete promises. The government plans to ―begin negotiations on emission reductions;‖ ―develop a definition for eligible greenhouse gas offsets;‖ and ―enhance government support for the Alberta Energy Research Institute‖

(Government of Alberta, 2002, pg. 2). The plan is just that—a plan for taking action in the future, rather than a concrete description of policies that Alberta will adopt. It therefore represents an excellent attempt at stalling against emission reductions, by outlining multiple areas of investigation for future action while establishing a non- binding goal that sounds good but does not actually lead to reductions at all.

These documents are not the only talking point used by the Albertan government to forestall serious action on climate change. The government also uses previously established policies, particularly those that are public-private partnerships established for stakeholder input, as an example of their excellent record on climate change. Indeed, one way that Alberta avoids creating substantial climate policy is by claiming that it has already done so. Within the legislature, when questioned by the Opposition as to what the government plans to do next on Climate Change, the Ministers and Premier 108

frequently respond by citing the many achievements Alberta has already seen—such as

Climate Change Central. For example, when a member of the opposition party commented that ―this government had never any intention…to deal with global warming‖ a Conservative MLA replied, ―The Alberta government has been exemplary in cleaning up our air and cleaning up our water, and we have actually done it as opposed to what‘s happening with Kyoto‖ (Alberta Hansard, November 27, 2002, pg. 1589). Another MLA claimed, ―we have been accused of doing little or nothing…Actually, Alberta leads the nation a on a number of energy conservation fronts…We have lots to celebrate here, even brag about, not apologize for‖ (Alberta Hansard, November 27, 2002, pg. 1590).

Rather than avoiding the climate issue, Alberta flaunts its credentials.29

Discussions of climate change by government officials and MLAs make frequent mention of its regulatory scheme as the ―first of its type in North America‖ as well as the three awards the government won for its efforts in cutting emissions in public building operations (Interviews with Alberta MLA 1 and Alb. Environment officials 1 & 2).30

Criticism of Alberta is rampant in other provinces, but inside, officials speak as if their province has the reputation of a California or Quebec. Indeed, policymakers bill Alberta as an innovator on climate change—and use that status as a rationale for slow moving action in new areas.

Minimizing Action on Climate Change: As we have already seen in the previous section, even those policies that Alberta does adopt do little to reduce greenhouse gas emissions.

29 This is not an uncommon response by governments. Leaders and laggards alike claim green credentials on even the most basic climate change policies. 30 Interviews with numerous MLAs and officials at Alberta Energy and Environment. 109

Most of them set up voluntary programs rather than required regulations, while others may be required but will result in few reductions. These minimal efforts are dismissed by one opposition MLA as being ―as phony as a three-dollar bill‖ (Boyd, 2003).

Alberta‘s policies on climate change are largely voluntary. The intensity targets are entirely voluntary, requiring no actual reductions from industry. Likewise, Climate

Change Central provides education on energy efficiency for the public, but there are no requirements for individuals to act in more efficient ways. The ME First! Program established in September 2003 gave municipalities access to $100 million to make energy efficiency improvements, but again, this incentive program came with no requirements for action.31 Clearly, Alberta was determined to minimize the number of required programs it would establish on climate change.

Even the intensity targets showcase Alberta‘s attempts to pursue minimal action on climate change. As discussed earlier in the chapter, intensity targets allow adopters to continue emitting without seeking absolute emission reductions. Emissions can actually increase, as long as the economy grows. The United States, which also adopted a federal voluntary intensity target, experienced a 20% decrease in the greenhouse gas intensity of its economy from 1990 to 2005, but its economy grew by 46% (National Resources

Defense Council, 2005). This resulted in a 17% increase in emissions. Therefore, the cornerstone of Alberta‘s policy to address climate change does very little in terms of achieving actual reductions.

31 By 2007, $30 million in interest-free loans had been provided to 60 municipalities. (Alberta Hansard, April 3, 2007, pg. 378) 110

Obstructing Action on Climate Change: Alberta has certainly used its policies to stall further action, but the government has also acted even more overtly in blocking stringent emission reduction policies. This is most notable in Alberta‘s efforts to prevent ratification of the Kyoto Protocol.

Stonewalling efforts go back to the creation of the Framework Convention on Climate

Change. As one MLA argues,

this government sent its contingent of ministers to Rio to oppose any steps being

taken by the international community in Rio, then it packed up two members to

Kyoto to again do the same: to oppose the conclusion by the international

community of an agreement, of an accord which we now know as the Kyoto

protocol. This government…had every intention to oppose and defeat any action

taken globally by the international community to deal with global warming.

(Alberta Hansard, November 27, 2002, pg. 1589).

Indeed, the ratification debates in 2002 were characterized by intense efforts by

Albertan officials to prevent Canada from joining the accord. This ―very aggressive defensive action‖ originated with Premier Ralph Klein and his chair of Alberta‘s Kyoto external advisory committee, former Premier Peter Lougheed (―Alberta launches,‖ 2002).

Since the provinces are granted jurisdiction over the use of natural resources, both men claimed in speeches that the Kyoto Accord represented not only an economic threat but also an illegal act by the federal government. A national mass media campaign followed, 111

including a web site outlining Alberta‘s position, television and radio advertisements, and public opinion polls. The campaign cost $1.5 million and was rolled out in the spring and fall of 2002 while policymakers put forward Alberta‘s ―Made in Canada‖ plan: the

Taking Action plan outlined earlier.

Clearly, Albertan officials were interested in obstructing progress on Canadian attempts to pursue emission reductions. As Rabe (2005) points out, ―Unlike

California…Alberta‘s primary role has been one of a spoiler, actively attempting to thwart ratification of Kyoto and subsequently attempting to block federal implementation plans.‖ With the costs of economic transition high, and few rewards expected from paying such costs on a low priority issue, Albertan officials flourished in the role of policy obstructionists. Part of this borne out of hopes that the entire issue, if delayed, would simply disappear. As one MLA accuses,

The longer the federal government delays ratification, the more difficult it will be

for Canada to meet its Kyoto emission reduction targets…Given the Alberta

government‘s stated goal of killing Kyoto ratification, the only thing that would

be accomplished by a delay is to make it just that much more difficult for us as a

nation to meet our Kyoto obligations. That‘s why the Premier‘s call for Kyoto to

be delayed for 18 months or two years is really just a stalling tactic. (Alberta

Hansard, November 27, 2002, pg. 1589)

But it was not entirely about stalling and preventing action. Some policymakers genuinely were interested in addressing climate change, but believed that the Kyoto

Protocol, with its shortened time frame, was the wrong path to achieve emission 112

reductions (Interviews with Alberta MLA 2 and Kyoto delegate). Alberta would require serious technological innovations in order to reduce emissions in a way that would be manageable for the local economy. But the political will to do so was not there. Indeed, it was not until 2006 that Albertan officials developed an interest in engaging in Climate

Innovator Behavior.

Alberta 2007-2008: The Climate Innovator

In 2007 and 2008 Alberta shifted gears dramatically on climate change, moving from a Climate Obstructionist to a Climate Innovator in two short years. During this period, a series of new legislation and plans were adopted, mandating reductions by industry, devoting huge resources to carbon capture and storage, and exploring renewable energy. It was also during this period that Canada itself shifted from a top-down system to a bottom-up system, as the new Conservative federal government made it clear that they would no longer attempt to achieve Canada‘s Kyoto targets.

Alberta’s New Policy

The cornerstone of Alberta‘s new policy is the Climate Change and Emissions

Management Amendment Act of 2007 which establishes new emission intensity targets and regulations to ensure that industry meets them. Adding to the earlier intensity target of 50% below 1990 levels by 2020, the government adopted a longer-term goal of 50% below business-as-usual levels (14% below 2005 emission levels) by 2050. A year later, in its 2008 Climate Change Strategy, ―Responsibility/Leadership/Action‖ the government committed to absolute targets as well: a 20 megaton reduction by 2010; 50 megatons by 113

2020, and 200 megatons by 2050. To meet these targets, Alberta established regulations for its large industrial facilities that produce over 100,000 tons of CO2 per year.

According to the Specified Gas Emitters Regulation that accompanied the 2007 Act, each facility must reduce its intensity by 12% below an average of its 2003, 2004, and 2005 emissions, though new facilities are given a grace period. Producers are given a choice, however, in how they meet this requirement. Three methods are allowed: producers can implement the reductions themselves, buy credits from over-performers, or contribute to the Climate Change and Emissions Management Fund at a price of $15 per ton. As of

2008 only half of the emissions target was achieved, as many producers chose to pay into the Fund rather than purchase credits or undertake the reductions themselves (Fickling,

2009).

Another crucial element of Alberta‘s new plan is the commitment of $2.5 billion to develop carbon capture and storage capabilities for the province. This is a relatively untapped policy area: rather than reducing the burning of fossil fuels, the emissions are captured and stored underground, and therefore prevented from reaching the atmosphere and contributing to global warming. This policy is projected to save more than 100 million tons of carbon from reaching the atmosphere by 2050, but will come at a substantial cost: approximately $50-70/tonne of CO2 (Flint, 2008). This commitment of resources and willingness to pay high costs is certainly a new development in Albertan policy.

A third new element to Alberta‘s policy is a new focus on renewable energy. In

2007, the government established a provincial goal to generate 12.5% of its electricity

114

from renewable and alternative sources by 200832 and 20% by 2020 (Fickling, 2009).

This is on par with most of the progressive Renewable Portfolio Standards found in the

United States. In addition, the province put $209 million into a Renewable Energy

Producer credit, awarding a tax break to distributers who blend biofuels. This money is intended to achieve a 5% ethanol content in gas and diesel by 2010. One official at

Alberta Energy said that Alberta is now determined to be a ―first follower‖ on renewable energy, adopting polices that are effective elsewhere in Canada and the United States

(Interview with Alb. Energy official 3).

These new policies are significantly different from the 2002 plans. They commit

Alberta to mandatory action on reducing the emission intensity of the economy, rather than creating a voluntary goal. Policymakers set a price on carbon, created long-term goals, and adopted indirect policies in renewable energy. Clearly, something shifted in

Alberta politics.

That ―something‖ is the priority of addressing climate change. The Conservative party maintained control of the Assembly over this entire period, so the shift cannot be attributed to a change in party control. Instead, there is clear evidence that acting on climate change became a top priority for the public and industry, and therefore for the government.

An Increasing Priority for Climate Change

In March 2007, the Albertan government shifted course in a very public way. The

Environment Minister, Rob Renner, gave a press conference where he acknowledged that

32 Renewable energy already accounted for 12.5% in 2007, so this was not a genuine goal. 115

climate change was real and that Alberta could no longer ignore the issue. When asked about why the government shifted course, Environment Minister Renner replied, ―the world that we live in has changed significantly in the past five years‖ (Alberta Hansard,

March 3, 2007, pg. 125). Indeed, the world did change in the five intervening years. The consensus on climate change became more certain and more public, thanks to a series of reports issued by the IPCC and the release of Al Gore‘s film, An Inconvenient Truth. The international shift caused by these high profile releases complemented events in Alberta itself, where the physical evidence of temperature changes became more visible, leading to an increase in public concern about climate change.

Public concern clearly rose from 2002 to 2007 and climate change climbed the priority list as a result. David Swann, shadow minister of the Environment for the

Liberal Opposition argued that, ―climate change is now the number one issue for

Albertans and Canadians, even above health care‖ (Alberta Hansard, March 22, 2007, pg.294). Another MLA agreed, commenting that, ―when you look back now…years later, it is quite clear that issues around the environment have risen pretty much to the top of the public consciousness‖ (Alberta Hansard, March 22, 2007, pg. 310). A third called it,

―the single most important issue of our time‖ (Alberta Hansard, April 3, 2007, pg. 380).

Never before had such strong language been used to describe climate change, not even by the opposition parties. Perhaps the fact that poll data showed that climate change was a top issue in Alberta, and that decisive action on the issue was desired by a majority of citizens led legislators to speak more strongly in favor of addressing climate change in the Assembly (cited in Alberta Hansard, April 12, 2007, pg. 556). Speculation by officials and MLAs cited the physical evidence of climate change as a rationale for the 116

new importance of the issue. Whereas before, only two mentions were made of glaciers retreating in Alberta, both mentions of which were met with skepticism as to the cause, now multiple mentions were made of temperature differences, weather patterns, and water shortages, all connected to climate change (Alberta Hansard, March 20, 2007, pg.

244).

The increase in public concern was not enough, however, to shift climate change into a top priority for policymakers. Instead, concerns about the competitiveness of

Alberta‘s economy increased the salience of the issue. As one senior official at Alberta

Energy said, ―there was increased pressure from the public in general on being environmentally friendly. The international view of Alberta was important, but there was also the feeling that if want to continue as a global leader in oil and gas, we can‘t ignore environmental sustainability‖ (Interview with Alb. Energy official 3).

In 2002, policymakers worried that cutting emissions would lead to more expensive products that would be difficult to sell in the rest of Canada and the United States. By

2008, however, consumers were demanding that their products be ‗green‘—and Albertan oil was most certainly not in that category. Albertan policymakers quickly realized that the competitiveness of their economy depended not on avoiding emission reductions, but embracing them (Interviews with Alb. Energy official 3 & Alb. Environment official 2).

―Some smart people realized that you can‘t sell products into markets nowadays if it‘s not green—clean, or has carbon reductions. There has been a conversion around the world... The green wave has occurred. Industry has recognized that they need to respond to it‖ (Interview with Alb. Energy official 3). This sentiment, as expressed by one senior official at Alberta Energy, encapsulates the real motivation behind Alberta‘s shift in 117

priorities. Alberta‘s obstructionist behavior against Kyoto started to have a real international backlash that impacted the economy, as consumers sought out greener producers. As an official at Alberta Environment put it, ―The world has accepted climate change. Certain things are now unacceptable. It‘s a social change, like smoking in public. Its now the same as just emitting high levels of GHG‖ (Interview with

Environment official 2). Albertan policymakers recognized that the gains made by keeping emissions stable would soon be lost as consumers turned elsewhere—even countries such as Saudi Arabia and Venezuela—for their oil (Interview with Alb. Energy official 2).

The seriousness of the Green Revolution was brought home in 2008 when the US

Conference of Mayors called for a boycott of the Alberta oil sands. The government responded with a $25 million publicity campaign designed to improve Alberta‘s world image, but clearly, real action would be needed to change the world‘s assumptions about

Alberta. Environment Minister Rob Renner admitted, ―Approximately 70 percent of potential for reduction of carbon emissions in this province is through carbon capture and storage. I have to be honest with the member: the cost of this capture and storage is enormous, but the cost of inaction is probably even more.‖

Newspaper editorials at the time confirm that the shift in climate change‘s priority was not due to a sudden change of heart regarding the subject, but a recognition of the economic implications of inaction. The media in Alberta continued to refer to the ―so- called‖ consensus and ―incorrect premise‖ of global warming, arguing that ―UN claims of scientific support‖ for the IPCC reports are highly exaggerated (Martinuk, 2008;

Goldstein, 2008b). Meanwhile, news reports note that the oilsands are being painted as 118

an ―emerging Mordor‖ and that industry must take action because ―the world is watching.‖ One 2008 editorial in the Calgary Sun noted that ―fiscally responsible politicians (should) finance…the development of renewable and nculear energy and carbon capture technology, which will reduce carbon emissions (and deadly air pollution, a separate issue), plus contribute to global stability by reducing the world‘s reliance on

Mideast oil.‖ The same editorial argued against carbon taxes and cap-and-trade measures, arguing that they are ―ineffective, impractical, outdated, and punitive‖

(Goldstein, 2008a). The priority of climate change was certainly rising—but only due to the need to correct its dirty oil image (Fekete & Varcoe, 2008).

Alberta‘s new policies, therefore, can be attributed to the rise in climate change‘s prominence on the government‘s agenda. Economic realities forced the government to reevaluate its voluntary approach to policymaking and investigate ways to address climate change, even though the costs of doing so were still high. The solution was in large part to commit serious resources--$2.5 billion—to developing Alberta‘s carbon capture and storage capabilities. This policy responded to Alberta‘s particular problem: the public, industry, and government revenue depended on addressing climate change, but the costs of doing so, given Alberta‘s reliance on oil and coal, remained high. As the priority rose, the government needed to respond in order to meet public demands and economic needs. However, the high costs of reducing emissions meant that the normal policy avenues were unavailable to the Albertan government—it could not adopt absolute emission targets, close down power plants, or abandon the tar sands. The government needed to find ways to address the problem in politically acceptable ways that work with local resources. Carbon capture and storage represent an innovative response to this 119

dilemma. Under these new conditions, we would expect Alberta to shift from being an

Obstructionist to a Climate Innovator—and indeed, Alberta‘s commitment to industrial regulations and carbon capture and storage represent truly innovative responses to climate change.33 High climate priority coupled with high costs of economic transition lead governments to look for innovative ways to meet policy demands while keeping the economy moving forward.

* * *

In this chapter, we looked at the case of Canada, focusing in particular on the province of Alberta and its policymaking process. We examined the history of Canadian policymaking on climate change and determined how Canada fit as an example of the

Top Down model of policymaking. We then looked at the effects this Top Down model has on policy in Canada and explored two of the policy types in our Sub-National

Climate Policy Typology: the Climate Obstructionist and the Climate Innovator. We illustrated these two types using the case of Alberta, showing how a change in the priority of climate change can lead to vastly different behavior in the same province.

In the next chapter we will examine the case of the United States, a clear example of a bottom-up system. Moments of opportunity led to policy champions crafting climate policies that met local priorities and needs. These policy experiments eventually led to the recognition of best practices, which have spread to other states and even the national government. We will use the state of California to illustrate sub-national policymaking

33 The industrial regulations represent the first such policy in North America; Alberta spends more on carbon capture and storage technology in the province than the United States did as a whole in its 2008 budget. 120

under these conditions. That state moves swiftly from acting as a Climate Fruit-Picker to a true Climate Crusader.

121

Chapter 4: Sub-national Climate Policy in the United States

In the previous chapter, we examined the top-down model of climate policymaking as exemplified by Canada and its provinces. We began by looking at the national process of climate change decision making and argued that the ratification of the Kyoto Protocol created a set of national priorities to meet international goals that led to pressure on the provinces to act. This commitment created certain parameters for provincial policymaking: policies needed to be direct, short-term and often represented a race to the bottom vis-à-vis other provincial action. Using the case of Alberta, we illustrated two parts of the Policy Choice Typology: the Climate Obstructionist and the Climate

Innovator. While the cost of transitioning to a fossil fuel free economy remained high from 1998-2008, climate change increased dramatically as a priority in 2007 leading to

Alberta‘s conversion from an Obstructionist to an Innovator.

In this chapter, we turn our attention to the case of the United States. We start by looking at the history of national policymaking on climate change, and quickly determine that action at the sub-national level far exceeds federal efforts. The bottom-up model tells us that experimentation should be initiated by the states, and the next section shows that this is precisely what happened. Major policies begin at the sub-national level, are widely emulated by neighbors and peers, and eventually trickle up to influence federal government policymaking. Once we establish the U.S. as a clear example of the bottom-

122

up model by looking at the traits of the bottom-up system, we examine the last two parts of the Climate Policy Typology-- the Fruit Picker and the Crusader-- using the case of

California. From the early 1990s until 2002, California engaged in very limited action on climate change, largely engaging in ‗picking the low hanging fruit‘ available to the state.

Starting in 2002, California began moving in the direction of a Crusader, adopting initial policies in auto emission standards and renewable energy that would pave the way for its ground-breaking policies in 2006. By that year, California—armed with a low cost for state-level efforts and with climate a top public and government priority—truly took on

Crusader status, working for comprehensive policy in the state and actively exporting it around the country and world.

Climate Change Policymaking in the United States: 1988-2008

1988-1992: The Bush 41 Years

Climate change first entered the U.S. political agenda in1988 thanks to a severe drought, numerous wildfires, and highly-publicized testimony by NASA climate scientist

Dr. James Hanson to the US Senate.34 The United States joined the UN‘s negotiations on what became the Framework Convention on Climate Change (UNFCCC) in 1990, and was among the first signatories to the Convention in 1992. At the time, several countries strongly lobbied to adopt binding emission reduction commitments, but the United States objected. After a great deal of debate and negotiation, the United States won the point, and the resulting agreement contained only a framework for cooperation with no binding commitments. The watered-down UNFCCC entered into force in March 1994 after

34 Q,v. Hansen (2000) 123

receiving the requisite 50 ratifications, including that of the US on October 13, 1992.

The United States remains a committed member of the treaty, though it does not take part in any negotiations regarding the implementation of the Kyoto Protocol.

In December 1992, George H.W. Bush issued the National Action Plan for

Global Climate Change which estimated current US emissions and identified existing activities that influence them. These programs—including Energy Star, standards for green buildings, motor vehicles, and landfills—were designed with energy conservation and reducing air pollution in mind—―any global climate change benefits would be a bonus‖ (Parker & Blodgett 2008). Thus began the US experience with ―no-regrets‖ measures—policies that required few costs to enact and often featured climate change benefits as a perk, rather than a mission.

1993-2000: The Clinton Years

The Clinton Administration took office soon after the negotiations on UNFCCC concluded, and led the United States in negotiating the agreements leading up to the

Kyoto Protocol in 1997. In 1993, the Administration released a Climate Change Action

Plan, proposing voluntary measures to meet the U.S.‘s share of the Framework

Convention‘s goal of stabilizing emissions at 1990 levels by 2000 (Justus and Fletcher

2006). The mid-1990s were characterized by the international negotiations for mandatory measures to meet the UNFCCC‘s goals. Environmentalist enthusiasm for strict regulations was dampened by the success of the ―carbon club,‖ a group of coal, oil, and auto industry representatives who lobbied the government to stall, weaken, and outright prevent any global warming agreements (Leggett 2001). The United States 124

approached the negotiations in Kyoto with several priorities in mind. First, the US supported binding targets for greenhouse gases, but called for the 2008-2012 period to be used to reach 1990 levels, with unspecified reduction levels for the five years following the initial period. Using a commitment period rather than a single year deadline allows for flexiblity in meeting any emission commitments. The United States also wanted to reduce the costs of complying with any binding targets. To that end, it argued to include what became the ―flexibility mechanisms‖: emissions trading, Joint Implementation, and the Clean Development Mechanisms. These three mechanisms would allow countries to receive credits for emission reduction projects undertaken outside their borders.35

International and domestic trading systems would be created after ten years, and developing countries would be asked to undertake specific commitments (Fletcher 1997).

The last element was perhaps the most important, as the President faced opposition in the

Senate. The ―Byrd/Hagel Resolution,‖(S. 98) which passed the Senate 95-0, required that any protocol to the UNFCCC that mandated commitments for industrialized countries also require commitments of developing countries. Indeed, as the final Kyoto Protocol did not include such provisions, many members of the Senate were angered when Vice

President Al Gore signed the Protocol on behalf of the United States. The Clinton

Administration, knowing it would be unable to get 2/3 approval in the Senate, never submitted the Protocol for ratification.

35 Although the United States did not ratify the Protocol, the ―flexibility mechanisms‖ were still included in the agreement and later used by members of the regime. 125

2001-2008: The Bush 43 Years

In March 2001, the newly elected George W. Bush Administration announced that the United States would not ratify the Kyoto Protocol, a decision that would have widespread ramifications for those countries that remained party to the accord. In his

June 11, 2001 speech, Bush referred to the Kyoto Protocol as ―fatally flawed.‖ He noted several concerns with the Protocol:

Kyoto is, in many ways, unrealistic. Many countries cannot meet their Kyoto

targets. The targets themselves are arbitrary and not based upon science. For

American, complying with those mandates would have a negative economic

impact with layoffs of workers and price increases for consumers. And when you

evaluate all these flaws, most reasonable people will understand that its not sound

public policy…Our approach must be based on global participation, including that

of developing countries whose net greenhouse gas emissions now exceed those in

the developed countries.

The US rejection weakened the Protocol, not only by denying US leadership to future decisions on how to move forward with reductions, but also by removing 25% of world emissions from the agreement. Following the US withdrawal, President Bush convened a cabinet-level Committee on Climate Change Science and Integration (CCCSTI), announcing in February 2002 that the US would have its own domestic approach to climate change focused on intensity reduction targets (Justus & Fletcher 2006). The US committed to reducing the GHG intensity of the economy by 18% by 2012—a commitment that should prevent the release of 1,833 teragrams of carbon dioxide into the 126

atmosphere (Environmental Protection Agency, 2007). Beyond this, the Administration largely ignored significant climate policy initiatives—and even obstructed the progress of congressional and state-level initiatives36—for the next six years.37

On June 22, 2005, the U.S. Senate acknowledged the anthropogenic threat of global warming, passing a ―Sense of the Senate‖ resolution attached to the Energy Policy

Act of 2005. The resolution declared that ―Congress should enact a comprehensive and effective national program of mandatory, market-based limits and incentives on emissions of greenhouse gases that slow, stop, and reverse the growth of such emissions‖ while motivating others to act and reducing the chances of economic damage.38 The following year, the House Committee on Appropriations passed a similar resolution, adding on a directive that the EPA should study the impacts of climate change on public health (Justus & Fletcher 2006).

Congressmen and women introduced numerous pieces of climate change legislation in the 109th and 110th Congress, but few made it out of committee. Several of these (H.R. 759; H.R. 5049; and S. 1151) called for the creation of market-based mechanisms to reduce greenhouse gas emissions; others (H.R. 955; S.245) simply called for more research or education on the subject or (H.R. 3057; S.388; S.745) for initiatives

36 Several states petitioned the Environmental Protection Agency (EPA) to regulate carbon dioxide and other greenhouse gases. The EPA claimed that it had no authority to regulate carbon dioxide as a pollutant. The case went to court, and in Massachusetts v. EPA (2006), the Supreme Court decided in a 5-4 ruling that the EPA was responsible for regulating carbon dioxide. In addition, the EPA denied California a waiver to adopt stricter regulations on automobile emissions as per the 2002 Pavley Bill—the first time California had been denied a waiver under the Clean Air Act to enact policies stricter than the federal government. 37 Numerous federal programs with impacts on climate change were adopted during this period, but were for the most part renewals and extensions of existing energy efficiency programs such as ―Energy Star‖ 38 The resolution was not included in the final legislation signed by the President. 127

to develop clean energy. Only one of the latter made it out of committee (Justus &

Fletcher 2006).

2001-2008: Sub-national Action

During this same period of low-level federal action on climate change, sub- national action at the state and municipal level was explosive. More than 350 cities in the

US joined the Cities for Climate Change program and more than 800 mayors signed the

US Conference of Mayors Climate Protection Agreement, committing their cities to meeting or beating the 7% reduction target given to the United States at Kyoto. At the state level, as shown in Table 4.1, more than half of the states have matched federal government action, creating climate action plans, clean energy programs, and establishing greenhouse gas inventories to track emissions in their states. Moreover, numerous states have gone well beyond federal action, adopting absolute greenhouse gas emission targets, renewable energy portfolio standards, and energy efficiency projects.

Table 4.1. Climate Change Policies in the States

Policy Number of States with Each Policy Regional Initiatives 36 Climate Action Plan 37 GHG Targets 17 GHG Inventory 43 GHG Registry 41 Carbon Cap/Offsets 5 Public Benefit Fund 24 Renewable Portfolio Standard 27 (continued) 128

Table 4.1: continued

Net Metering 44 Green Pricing 45 Energy Efficiency Resource 12 Standard Appliance Efficiency 12 Standards State Governments Purchasing 17 Green Power Data source: Pew Center on Global Climate Change, ―Climate Change Initiatives and Programs in the States‖. Available at www.pewclimate.org.

The 2001-2008 period represents a mismatch in federal and sub-national approaches to climate change policymaking. The federal government engaged largely in voluntary policies aimed at achieving minimal economic costs (and minimal impacts on climate change), while many states inside the U.S. took on aggressive commitments and adopted costly regulations on the issue. Unlike in Canada, where the federal government initiated roundtables and other initiatives, trying to convince the provinces to act, in the

United States it was the states who petitioned the federal government for action.

California, as we shall see, adopted strict legislation on automobile emissions and petitioned the federal government to be allowed to implement their regulations. The

EPA‘s denial led to a lawsuit against the federal government. Likewise, several states, led by Massachusetts, asked the Environmental Protection Agency to regulate carbon dioxide as a pollutant under the Clean Air Act. The EPA‘s refusal led to another lawsuit, decided in the favor of the states by the Supreme Court in 2006. Clearly, the United

States is an example of bottom-up rather than top-down policymaking.

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The United States: Bottom-Up Policymaking

As Figure 4.1 shows, in a bottom-up model we expect policy to originate among sub-national governments, who emulate best practices by neighbors and peers. The sub- national governments then pressure the national government to act. The international regime is still present but has no direct impact on policymaking at the national or sub- national level of government. The main role of the international regime in this model is to provide internationally accepted standards of measurement or focal points for policy.

Lack of membership in the international regime creates no national commitment to its dictates and therefore no incentive for federal government to put pressure on the sub- national governments. In fact, quite the opposite is true in the case of the US: withdrawing from the Protocol led to international backlash and censure and the success of states in addressing climate change was viewed by some in the Bush Administration as an embarrassment to the federal government (Interview with EPA official).

130

Kyoto Protocol

U.S. National Government

Policies

Other California Ohio Sub-National Governments

Figure 4.1: Bottom-Up Policymaking in the United States

The United States, therefore, represents the bottom up model, having no international commitment to the Kyoto Protocol. This has translated, in practice, to no pressure from the federal government on states to adopt particular policies or meet a target.39 Instead we have individual states experimenting with different policies, sharing information with each other and adopting policies begun in other states. We also have efforts by states to lobby the federal government to adopt particular policies that have found success at the state level, one indicator identified in Chapter 2 as typical of bottom- up behavior. In the next sub-sections, we will look at these state-led efforts at experimentation, emulation, and lobbying in more detail.

39 The intensity targets adopted in 2002 are voluntary, and aimed at industry. States have been given no responsibility or authority to meet these targets. 131

Policy Experimentation

The states have engaged in extensive policy experimentation to address climate change according to their local needs and situations. Various measures have been employed, such as auto emission standards, renewable energy portfolio standards, and regional initiatives.

One common area of state-level experimentation is standards for greenhouse gas emissions of automobiles. In 2002, California enacted AB 1493, known as the Pavley

Bill, requiring reductions in greenhouse gas emissions from light-duty vehicles. This bill directed the Air Resources Board (ARB) to create new regulations for vehicles starting in

2009. The ARB called for a 23% reduction in greenhouse gas emissions from new vehicles by 2012 and a 30% reduction by 2016. California is the only state granted waivers under the Clean Air Act to enact regulations more stringent than those of the federal government and other states can choose whether to adopt the federal or California standards.

The federal government fought back against the new California standards. The

EPA denied California‘s waiver request, citing a fear of a creation of a patchwork of policies on auto emissions in the U.S. This was the first time in the history of the Clean

Air Act (and approximately sixty requests) that California had been turned down. EPA

Administrator Stephen Johnson defended the decision, claiming that ―The Bush

Administration is moving forward with a clear national solution—not a confusing patchwork of state rules—to reduce America‘s climate footprint from vehicles‖ (―EPA

Faces,‖ 2007). Although the 2007 energy bill required a 40% improvement in mileage for light-duty vehicles by 2020, the law included no measures on automobile emissions, 132

and the Bush Administration never wrote any regulations to enforce the law (Broder,

2009). Clearly, the impetus for improving automobile emissions as a method of fighting global warming originated in the states, not the federal government.

A second area of extensive policy experimentation at the state level is the

Renewable Energy Portfolio Standard (RPS). Renewable Portfolio Standards, also called

Renewable Energy Portfolios, require electricity providers in a state or country to acquire a certain minimum percentage of their power from renewable resources. This US-grown policy phenomenon started in Iowa and has spread to twenty-six other states as well as several other countries, including the United Kingdom, Sweden, Belgium, Italy, Poland,

Japan, and Australia (Wiser et al., 2007).

In 1983, the Iowa Alternative Energy Production law established the first RPS, requiring two state utilities to generate 105 megawatts of electricity from renewable energy resources (Pew Climate, 2009c). The law stated, ―It is the policy of this state to encourage the development of alternate energy production facilities and small hydro facilities in order to conserve our finite and expensive energy resources and to provide for their most efficient use‖ (Iowa Code ch. 476 § 41).

Motivations for adoption of an RPS are frequently mixed: certainly for Iowa, addressing climate change was not a factor in the decision (as climate change did not appear on the political radar screen until 1988). For many states, an RPS is a way to promote development of a new industry or take advantage of unused energy resources.

Texas, for example—a state few would expect to be on the cutting-edge of global warming action—adopted an RPS in 1999, but focused primarily on the economic opportunities presented by using wind for energy in that wide-open, flat state. For other 133

states, the RPS is one tool in the climate change-fighting arsenal—for example, upon signing Senate Bill 107 in 2006 which established an RPS for California, Governor

Arnold Schwarzenegger remarked, ―The science is clear. The global warming debate is over. We have a responsibility to act now. These bills, along with my signing of

California‘s landmark greenhouse gas bill later this week, will help California reduce greenhouse gas emissions and continue our leadership on protecting the environment‖

(Calif. Office of the Governor, 2006). In other states, the motivation is more mixed, with the energy and economic advantages cited alongside the environmental ones.

Twenty-eight states plus the District of Columbia have mandatory RPS; an additional five states have voluntary standards for their utility commissions (Pew

Climate, 2009c). One innovation in the state-borne RPS includes the use of long term goals with interim benchmarks. Thus, Maryland set a target of 3.5% renewable sources for electricity by 2006, and a further goal of 7.5% by 2019 (Rabe 2002). Most other states with mandatory RPSs have adopted this standard, establishing a long term goal with certain benchmarks to achieve along the way. Indeed, as the policy has diffused to other states, some features have become standardized, including a comprehensive list of possible energy sources, such as wind, solar, and ―clean coal‖ and the revision of existing

RPSs to encompass more ambitious goals. These developments will be discussed later in the chapter when we look at policy emulation amongst the states.

A third area of experimentation is the creation of regional initiatives to address global warming. There are three principal regional initiatives in the United States: the

Regional Greenhouse Gas Initiative (RGGI), formed in the Northeast; the Western

Climate Initiative (WCI) founded on the west coast, and the Midwest Greenhouse Gas 134

Reduction Accord (MGGRA). These initiatives are unique in that states in each region are joining together, sometimes with sub-national governments in neighboring countries-- to adopt their own greenhouse gas targets and creating cap and trade regimes to implement the targets. Unlike the European Union, which has government infrastructure to oversee the enforcement of their Kyoto commitments, these states have no formal relationships with each other, and no international commitment to fulfill. They have chosen to take on additional commitments with each other, sharing the costs but also the benefits of action. This collective action is surprising due to our expectations that a higher authority (in this case, national or international action) is needed to help states overcome their desire to free ride. Yet three different sets of states are working together to collectively reduce their emissions in the absence of national pressure, showcasing the very different world of bottom-up policymaking Three of the most active regional initiatives are the Regional Greenhouse Gas Initiative (RGGI), the Western Climate

Initiative (WCI), and the Midwest Greenhouse Gas Reduction Accord (MGGRA).

Seven Northeastern states founded the Regional Greenhouse Gas Initiative in

December 2005, the first and most rigorous regional climate change initiative in the

United States. Participants—as shown in Figure 4.2, now including ten states and two observers, Pennsylvania and the District of Columbia—agreed to cap their emissions at current levels in 2009 and then reduce their collective emissions by 10% by 2019. A cap and trade system would be created to help states achieve these reductions.

The Western Climate Initiative was founded by the governors of Arizona,

California, New Mexico, Oregon, and Washington in February 2007 as a joint effort to reduce emissions and create a market-based system to achieve reductions (PEW Climate, 135

2009b). The current target is a regional goal of 15% below 2005 emission levels. Since its founding, two U.S. states, Utah and Montana and four Canadian provinces—British

Colombia, Manitoba, Ontario and Quebec—have joined, along with fourteen observers including six states, two Canadian provinces, and six Mexican border states.40

Established in November 2007, the seven members and three observers of the

Midwest Greenhouse Gas Reduction Accord agreed to lower emissions by 60-80% below current levels in the long term and to establish a multi-sector cap and trade accord to meet these targets (PEW Climate, 2009b). As shown in Figure 4.2, the members of MGGRA include Illinois, Iowa, Kansas, Michigan, Minnesota, and Wisconsin, along with the

Canadian province of Manitoba. South Dakota, Indiana, and Ohio joined as observers.

Auto emission standards, renewable energy portfolio standards, and regional initiatives are just three of the areas of extensive policy experimentation found at the sub- national level in the United States. This is a crucial component of the bottom-up approach: policy initiatives are created and driven from the sub-national level, rather than imposed by a federal government or international regime.

40 Observers include Alaska, Colorado, Idaho, Kansas, Nevada, Wyoming, Nova Scotia, Saskatchewan, Baja California, Chihuahua, Coahuila, Nuevo León, Sonora and Tamaulipas. 136

Source: Pew Center for Global Climate Change

Figure 4.2: Regional Initiatives on Climate Change

Policy Emulation

There is more to the bottom-up approach than just the origination of policy, however. Another important element is that these policies diffuse between states before eventually influencing federal policy adoption. The United States is the site of extensive policy diffusion of its successful experiments. This can be seen in several of the policies that originated in the United States, including auto emission standards and renewable energy portfolio standards, as well as with greenhouse gas emission targets.

For example, soon after the announcement of California‘s new auto emission standards, sixteen states announced that they too would adopt the California standard.

These states are depicted in Figure 4.3. Under the Clean Air Act, states have a choice of adhering to federal regulations on pollutants or adopting California‘s standards, should

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that state choose to be more rigorous in its activities. California passed AB 1493, the legislation establishing the new standards, in 2002. In 2004, New Jersey and Connecticut became the first states to adopt regulations in keeping with the new California standards.

They were followed the next year by Oregon, New York, Maine, Rhode Island, and

Vermont, and in 2006 by Pennsylvania and Massachusetts. Finally, in 2007, Colorado,

Florida, Maryland, and Utah agreed to adopt the California standards despite the ongoing litigation by automakers.

Source: Pew Center on Global Climate Change. www.pewclimate.org

Figure 4.3: State Adoptions of California Auto Emission Standards

The clearest case of policy emulation of a state-led innovation. All the adopters explicitly mention in their Executive Orders and legislation that they are adopting the specific regulations established by California. For example, in New Jersey the legislation was referred to as the ―California Clean Car‖ Bill (N.J. Gov.‘s Ofc., 2004); Governor

Charlie Crist‘s Executive Order 07-127 in Florida specifically calls for the ―adoption of

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the California motor vehicle emission standards in Title 13 of the California Code of

Regulations‖ (Florida Ofc. of the Gov., 2007). Connecticut also clearly intended to follow California‘s lead. As State Department of Environmental Protection (DEP)

Commissioner Gina McCarthy said upon the Governor‘s signing of the Clean Car Act,

―when it comes to the California LEV II regulations, Connecticut is again a national leader in confronting vital climate change and energy issues…Adopting the latest

California standard will put a real dent in the level of emissions" (Conn. Ofc. of the Gov.,

2005). This is a clear cut case of a policy innovation diffusing to other states and regions through direct emulation.

The Renewable Energy Portfolio Standard (RPS) is another example of a policy that has rapidly diffused across the US. Thirty states plus the District of Columbia have adopted an RPS, five have adopted non-binding renewable energy goals, and an additional ten states have considered RPS bills in their legislature. Figure 4.4 indicates those states that have adopted an RPS or renewable energy goal. As we can see, the RPS is common in the Northeast, Midwest, and West, but almost entirely absent in the

Southeast.

The RPS originated in the United States in Iowa in 1991, when that state enacted legislation requiring that 105 megawatts of power be produced via renewable sources.

Massachusetts, Minnesota and Wisconsin enacted similar policies in 1997-1998, followed by Maine, New Jersey, and Texas in 1999. The policy accelerated in its diffusion starting in 2004, with ten states adopting an RPS over a two year period (Rabe,

2002, pg. 3), and 14 states either creating new renewable energy goals or upwardly revising existing agreements in 2007 alone. Statistical analysis has shown that the 139

adoption of an RPS leads to an eleven-fold increase in the likelihood of a neighboring state adopting an RPS (Villaire, 2008). It is clear that in both choice and design, states look to their peers for ideas. As one former state official in Nevada said regarding his state‘s RPS, ―We took some aspects of the Texas law and incorporated it to some degree into the Nevada Bill‖ (cited in Rabe, 2002).

There are clear commonalities among the RPSs in the US that reflect their shared origins. Each RPS requires that a certain amount of electricity be produced via renewable energy sources by a particular date. In many cases, an original RPS has been updated to increase the amount of renewable electricity required. Sixteen states with an

RPS have adopted such an update, some of them (California, New Mexico) more than once.

Another area of commonality occurs in the types of energy sources covered by the

RPS. Numerous sources are available for policies, ranging from: wind, photo-voltaic solar power, solar-thermal, biomass, geo-thermal, small hydro-electric, fuel cells, land fill gas, tidal/ocean, and wave/thermal. Additionally, some RPSs will allow electricity providers to use non-renewable energies such as ―clean coal‖ (as with the Ohio RPS passed in 2008). Early RPS tended to put no weight on any particular source of energy, but a growing trend among states is to classify energy sources or mandate that a particular source provide a percentage of the energy (Rabe, 2002). New Jersey, for example, gives such a privilege to solar power.

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Data Source: Pew Center on Global Climate Change. www.pewclimate.org

Figure 4.4. State Adoptions of Renewable Portfolio Standards

The RPS is another clear case of policy emulation in the United States. Starting with the initial adoption in Iowa, Renewable Portfolio Standards have spread rapidly across the United States. And they have notably in adopted in multiple regions, by states with Democratic and Republican governors and legislatures, and in states that due to their oil and coal production, would be unlikely candidates for champions of renewable energy. Clearly, states are looking to each other (and not the federal government) to find best practices. As one state legislator in Ohio said of her state‘s RPS, ―Of course we look at what other states are doing‖ (Interview with Ohio state senator).

Finally, Greenhouse Gas Emission Targets are another area of policy emulation evident in the U.S. Seventeen states, representing approximately 45% of the population of the United States, have set statewide emission targets. As Table 4.2 shows, these states have adopted a variety of goals and deadlines, but there are also some common traits among the policies, emphasizing the role of policy diffusion in this area.

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Table 4.2: State Greenhouse Gas Targets

State Year of Initial Goal* Mid-range Final Goal Adoption Goal* Arizona 2006 2000 levels by 50% below 2000 2020 levels by 2040 California 2005 2000 levels by 1990 levels by 80% below 1990 2010 2020 levels by 2050 Colorado 2008 20% below 80% below 2005 2005 levels by levels by 2050 2020 Connecticut 2008 1990 levels by 10% below 75-85% below 2010 1990 levels by 2001 levels in the 2020 long term Florida 2007 2000 levels by 1990 levels by 80% below 1990 2017 2025 levels by 2050 Hawaii 2007 1990 levels by 2020 Illinois 2007 1990 levels by 60% below 1990 2020 levels by 2050 Maine 2003 1990 levels by 10% below 75-85% below 2010 1990 levels by 2003 levels in the 2020 long term Massachusetts 2004 1990 levels by 10% below 75-85% below 2010 1990 levels by 1990 levels in the 2020 long term Maryland 2009 25% below 2006 levels by 2020 Minnesota 2007 15% below 30% below 90% below 2005 2005 levels by 2005 levels by levels by 2050 2015 2015 Montana 2007 1990 levels by 2020 New 2001 1990 levels by 10% below 75-85% below Hampshire 2010 1990 levels by 2001 levels in the 2020 long term (continued)

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Table 4.2: continued

New Jersey 2007 1990 levels by 2020 80% below 2006 levels by 2050 New 2005 2000 levels by 2012 10% below 2000 75% below 2000 Mexico levels by 2020 levels by 2050 New York 2002 5% below 1990 levels 10% below 1990 by 2010 levels by 2020 Oregon 2007 Stabilize by 2010 10% below 1990 75% below 1990 levels by 2020 levels by 2050 Rhode 2001 1990 levels by 2010 10% below 1990 Island levels by 2020 Utah 2008 2005 levels by 2020 Vermont 2001 1990 levels by 2010 10% below 1990 75-85% below 2001 levels by 2020 levels in the long term Virginia 2007 30% below ―business as usual‖ by 2025 Washington 2007 1990 levels by 2020 25% below 1990 505 below 1990 levels levels by 2035 by 2050

*not all states have defined short-term or mid-range goals Source: Pew Center on Global Climate Change, ―State Actions to Address Climate Change.‖ Available at www.pewclimate.org

As Figure 4.5 shows, greenhouse gas target policies are largely concentrated in the west and northeast, with a few isolated adopters in the Midwest and South. The role of the South as a laggard is as evident here as it was with the RPS, with only two states

(Florida and Virginia) establishing policies in this area. The northeastern states party to the Regional Greenhouse Gas Initiative were the first in the US to adopt greenhouse gas targets, committing to 10% below 1990 levels by 2020. The rush to adopt targets did not really begin, however, until after California committed to reduce its emissions in

Governor Schwarzenegger‘s 2005 executive order. Fifteen states followed California‘s

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lead, adopting similar policies within three years. Indeed, these policies share many common features, unsurprising considering their shared origins.

One common trait is that most states adopted a combination of short- and medium-term targets—usually around 10%-- for 2020 and a longer term target for either

2050 or an undefined ‗long run‘. For example, the earliest targets, adopted through the

Climate Change Action Plan developed by the New England Governors and the Eastern

Canadian Premiers, set three targets for its adopters: reducing statewide emissions to

1990 levels by 2010, ten percent below 1990 levels by 2020, and 75-85% below 2001 levels in the undefined ‗long term‘. Oregon set a goal of stabilizing emissions by 2010, reducing to 10% below 1990 levels by 2020 and 75% below 1990 levels by 2050 (PEW

Climate, 2009a).

Data Source: Pew Center on Global Climate Change. www.pewclimate.org

Figure 4.5: State Adoptions of Greenhouse Gas Targets

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Furthermore, early adopters tended to use the 1990 benchmark year established in the Kyoto Protocol but more recent target adoptions frequently use 2000 or 2005 as a benchmark to ease the economic pressure of reductions. For example, while Connecticut,

Illinois and New York amongst others use 1990, Arizona set a target of reducing emissions to 2000 levels by 2020, and then 50% below 2000 levels by 2040. Hawaii and

New Mexico also use a benchmark year of 2000; Minnesota uses 2005 as its year of reference (PEW Climate, 2009a).

There is a clear pattern of policy emulation and diffusion amongst the US states.

Greenhouse gas targets, renewable portfolio standards, and auto emission standards found in these states show clear similarities suggesting their common origins. In addition, statistical studies and comments from policymakers attest to state habits of looking to each other for ideas and best practices in addressing climate-change related issues. As the next section will attest, states do not stop at influencing each other, but also attempt to persuade the federal government to adopt the policies that have proved to work well in the state-led policy ―laboratory.‖

Lobbying the Federal Government

Sub-national influence on government action on climate change is perhaps most notable in the case of the California auto emission standards. Several states were active through both litigation and lobbying in ensuring national government approval of state legislation. Automakers filed suit against California in December 2004, challenging the state‘s authority to regulate emissions under the Clean Air Act. Two federal judge rulings in 2007 went against the automakers, declaring that states can regulate global 145

warming pollution from automobiles. Meanwhile, California filed three suits of its own against the EPA. The first, filed in October 2007, demanded that the EPA make a decision on California‘s waiver, first requested more than two years prior. The second, filed after EPA Administrator Stephen Johnson denied the waiver, had the support of sixteen states and five environmental groups and called on the EPA to reverse its decision on the waiver. A third suit was filed in April, asking a federal court to compel the EPA to regulate global warming pollution from vehicles, citing the ruling in Massachusetts v.

EPA (2007). The following year, in January 2009, California Air Resources Board Chair

Mary Nichols sent a letter to new EPA Administrator Lisa Jackson asking for a new decision on the waiver (Union of Concerned Scientists, 2009).

These efforts eventually resulted in success. On May 19, 2009, President Obama announced a national standard for new vehicle emissions that would equal California‘s measures by 2016 (Broder, 2009). Cars will be required to achieve 35.5 mpg and new cars will need to increase in efficiency by 5% each year between 2011 and 2016. As part of the agreement behind this new executive order, California is amending AB 1493 to comply with the 2016 regulations, and automakers have dropped their lawsuits against

California.

This is a clear example of sub-national experimentation leading first to emulation by other states and then to adoption by the national government. As President Obama said in his speech announcing the new regulations, ―I want to applaud California and

Governor Schwarzenegger and the entire California delegation for their extraordinary leadership. They have led the way on this as they have in so many other efforts to protect our environment‖ (Obama, 2009). 146

Another example of states lobbying the federal government for a change in policy is the case of Massachusetts v. EPA (2007). Following EPA General Counsel Jonathan

Cannon‘s legal opinion in 1998 that the EPA had the authority to regulate carbon dioxide under the provisions of the Clean Air Act, 18 environmental groups petitioned the EPA to create regulations in the area (Sierra Club, 2008). In 2002, the EPA reversed its prior position, stating that it did not in fact have the authority to regulate carbon dioxide, and that it would not do so even if it did have such authority. In a letter in March the previous year, President Bush stated, ―I do not believe, however, that the government should impose on power plants mandatory emissions reductions for carbon dioxide, which is not a ‗pollutant‘ under the Clean Air Act‖ (Bush, 2001a). Massachusetts led eleven states plus several local governments and environmental groups in filing suit against the EPA for failing to regulate carbon dioxide.

After the U.S. Court of Appeals ruled in favor of the EPA, the Supreme Court agreed to hear the case in June 2006. In April 2007, the Court ruled 5-4 in favor of the petitioners, reversing the previous decision; in his majority opinion, Justice Stevens noted that if the EPA found evidence that carbon dioxide was an endangerment to public health, it had the authority to regulate the gas under the Clean Air Act and indeed must regulate it regardless of political reasons not to do so. The EPA did not take action to determine the level of endangerment of carbon dioxide during the final years of the Bush

Administration, despite further petitions by environmental groups and another lawsuit.

However, in April 2009, the EPA ―formally declared carbon dioxide and five other heat- trapping gases to be pollutants that endanger public health and welfare,‖ setting the

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process of regulation in motion. This is another clear case of states lobbying the federal government to adopt policies enacted at the state level.

We have seen that policymaking in the United States exemplifies the bottom-up model of climate change policymaking. Policies originate in states that experiment to find policies to meet local needs and then emulate the policies of their neighbors. States also lobby the federal government to act more aggressively on climate change, introducing legislation that has found success elsewhere and engaging in litigation to force the government to act. Another unique aspect of the bottom-up model is the special role played by Policy Champions in keeping climate change at the top of the policy agenda and driving policy choices.

The Crucial Role of Policy Champions

A final feature of the bottom-up system is the crucial role played by Policy

Champions.

In top-down environments, the Kyoto Protocol and its requirements serve as the principal motivator for action. National governments are responsible for meeting their binding commitments, and in turn pressure their sub-national units to adopt policies that meet their objectives. Even governments that would rather ignore the issue entirely—such as

Alberta—are forced to respond in some way.

In the United States, the Kyoto Protocol can be ignored if sub-national governments so choose. The U.S. is not bound by the agreement, and therefore neither are the states. It is not surprising, therefore, that several states have done little or nothing to address climate change. Something must take the place of the Kyoto Protocol as a 148

motivator to get states to act. In bottom-up environments, that motivator is a Policy

Champion.

Barry Rabe (2004) argues that policy entrepreneurs have played a crucial role in creating climate policy in US states. As discussed in chapter two, Policy Champions use moments of opportunity to ensure that climate change gets onto the political agenda and work to harness public and stakeholder support to develop coalitions in support of particular climate policies. As we shall see, two Policy Champions—State Representative

Fran Pavley and Governor Arnold Schwarzenegger-- played crucial roles in California, helping the transition of policy from Fruit Picker to Crusader.

Subnational Climate Policymaking in the United States: The Case of California

The case of California allows us to explore the characteristics of the bottom-up approach.

From 1998 until 2004 California exemplifies the Climate Fruit Picker. Climate change at the time was a low priority but the cost of transitioning the economy was also low, creating incentives to adopt policies that ‗pick the low hanging fruit‘—i.e., those low cost, ―no-regrets‖ policies that allow governments to tout their progress without paying the costs that would lead to punishment locally. For example, the government might adopt efficiency standards for buildings and appliances that could create cost savings for consumers while reducing emissions, or close inefficient power plants and replace them with more ―green-friendly‖ production sites. From 2002-2006 California slowly transitioned from a Fruit Picker to a Climate Crusader as public interest in climate change grew, experimenting with new policies and developing a comprehensive strategy to mitigating climate change. By 2006, the state‘s low costs of transitioning and a new 149

determination to solve climate change led to California‘s new status as a Climate

Crusader. At this point, the government was ready to engage in sub-stnatial and well- funded emission reduction policies and attempt to get other governments on board with aggressive measures to tackle climate change. In this section we will look first at

California‘s Fruit Picking behavior from 1998-2004 before turning our attention to its

Climate Crusader activities from 2004 onward.

Climate Change in California: from Fruit Picker to Climate Crusader

As we shall see, California from 1998-2004 illustrates the case of the Climate

Fruit Picker. Even this state, known for its commitment to innovative environmental action, focused on ―no regrets‖ and ―low hanging fruit‖ measures for the initial period following the creation and signing of the Kyoto Protocol. The costs for moving away from fossil fuels are much lower in California than in Alberta, but as a very low priority for the public and policymakers, there was little incentive for California to engage in aggressive action on climate change until the middle of the decade. As we shall see, at the point, climate change became a key issue in California, and comprehensive action soon followed. Indeed, California did not stop at producing strong policy within the state, but campaigned—successfully-- throughout the US to see their measures adopted by peers and the federal government.

Climate Change: A Low-Priority Issue

In the 1990s and early part of the twentieth century, global warming was very low on the priority list for Californians and their policymakers. Polls, media reports, and policymaker interviews reveal that environmental issues in general, and global warming 150

in particular were rarely on the agenda. Indeed, even the two major pieces of legislation addressing climate change passed during this period—AB 1493 and SB 1078—were passed largely because of their impacts on other more salient issues, such as air pollution and electricity diversification.

Although California is known for its commitment to preserving the environment, the issue was low on the priority list from 1998-2002. The Public Policy Institute of

California issued a series of surveys during this period, revealing that the top issues for the public were crime (28%) and education (20%). Environmental issues were mentioned by less than 1% of respondents. Indeed, even when asked specifically if they viewed ‗environmental pollution‘ as a big problem, only 27% answered in the affirmative

(Baldassare, 1998). 37% claimed that ―stricter environmental laws and regulations cost too many jobs and hurt the economy‖, more than the 30% who answered this way in the larger United States. In 2000 and 2001, the numbers were similar. Three percent of

Californians wanted the 2000 presidential candidates to talk about environmental issues, compared to 19% who wanted to hear about education, 13% for taxes, and 10% for health care. In 2001, the top issue in California was electricity prices and deregulation, cited by

56% of respondents as the biggest problem in California (Baldassare, 2001).

Even within environmental issues, however, global warming was a low priority at this time. Polls indicated that it trailed far behind other pressing environmental issues such as air pollution. In 1997, just 27% said that they personally see global warming as extremely (7%) or very (20%) important (Nisbet & Myers, 2007). 52% would answer this way in a 2007 survey. In a 2000 survey, less than 1% of respondents answered

―global warming‖ when asked what they considered ‗the most important environmental 151

issue facing California today" (Baldassare, 2000). Air pollution was the most commonly cited response, with 33% of the votes, followed by development/growth, water pollution, and traffic congestion. In 2002, a follow-up survey revealed similar results: climate change still registered less than 1% of the answers, with air pollution receiving 34% of the votes (Baldassare, 2002). Global warming does not register on the survey until July

2003 (1% of the votes); not until July 2006 does it receive notable interest (8%, coming in third to air pollution (down to 24%) and ‗energy‘ (12%)).

It is clear, then, that the public lacked a substantial interest at this time in global warming as a pressing public policy concern. Newspaper editorials confirm that addressing global warming was not a top priority. Editorials in the main Californian newspapers—the Los Angeles Times, San Francisco Chronicle, and Sacramento Bee— reveal only a handful of examples of support for concerted action on global warming— and these surrounded the signing of AB 1493 in 2002. Editorials arguing against action, however, are plentiful—notably in the San Francisco Chronicle, where editorials frequently espoused anti-global warming rhetoric. As Debra Saunders writes in

November 2001, ―Kyoto is a hoax. It is the emperor‘s new clothes of diplomacy that allows haughty Europeans and enviros to berate the tackiness of President Bush‘s attire.

Credit Bush for seeing the nakedness as they brandish their worthless paper‖ (2001a).

Policymakers concurred with this general lack of interest in climate change. At the time, many policymakers—both Republicans and Democrats—were unconvinced by the science of climate change, believing its causes to be natural or that the issue, if it existed, posed problems for the future, not the present. This made it difficult to harness votes for particular climate-themed policies (Interview with Assemblyperson). Indeed, 152

those aggressive climate policies that did pass during this time—the auto emission standards and the renewable portfolio standard—did so largely due to their links to other crucial issues. As one official at the California Environmental Protection Agency said,

―global warming really didn‘t get on the radar until the Pavley Bill, and even then, it didn‘t take off until the Governor came in‖ (Interview with CALEPA official).

Climate Change in California: A Low-Cost Issue

Addressing climate change is a much less costly proposition for California than it is for Alberta. It is instructive to compare California to Alberta to understand the stark differences in the costs they each faced in confronting climate change. As we shall see, across numerous issues including economic diversification, lobbying capacity, and potential for renewable energy, California is much better equipped to handle the transition away from fossil fuel resources.

.California‘s economy, for example, is much more diversified than that of

Alberta. As Figure 4.6 shows, ―Trade, Transportation, and Utilities‖ comprise approximately 16% of the economy and jobs. Therefore fossil fuel based industries do not dominate the economy as they do in Alberta. Indeed, service industries, which contribute negligible greenhouse gases, predominate in California. Jobs are not dependent on maintaining or increasing fossil fuel industries. Indeed, a representative of the

California Climate Change Center at the University of California, Berkeley, estimates that the continued development of renewable energy could create up to 20,000 jobs and increase Gross State Product by approximately 60 billion (Interview with Berkeley scholar). And as the numbers for 2005 show, the composition of the economy does not

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change much over time, keeping these low costs stable throughout the policymaking period.

154

Source: (Calif. Legislative Analyst‘s Ofc., 2006)

Figure 4.6: California’s Economy, 2006

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Table 4.3. Sources of Employment in California, 2000 and 2005

Employment Sector Number of Percent of Number of Percent of

Jobs, 20001 Jobs, 2000 Jobs 20051 Jobs, 2005

Construction 765.5 4.5% 940.1 5.3%

Education and Health 1401.1 8.2% 1599.7 9.0%

Farming 2355.0 11.0% 2785.0 15.7%

Financial Activities 815.4 4.8% 941.9 5.3%

Government 2338.4 13.7% 2431.2 13.7%

Information 576.7 3.4% 473.6 2.7%

Leisure and Hospitality 1354.3 7.9% 1497.5 8.4%

Manufacturing 1875.6 11% 1500.1 8.7%

Mining and Logging 26.9 0.2% 24.3 0.1%

Other Services 493.1 2.9% 504.3 2.8%

Professional and 2266.8 13.3% 2188.4 12.3%

Business Services

Trade, Transportation, 2760.0 16.2% 2855.2 16.1% and Utilities

Total 17053 100% 17746 100%

1 Number of jobs in thousands. Source: Federal Bureau of Labor Statistics, data.bls.gov

Another reason for the lower cost in California is the diversified nature of electricity sources in the state. As Table 4.4 shows, coal provides only 20% of

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California‘s electricity, almost all of it imported from other Western states. Natural gas loosely dominates the field, providing 36.5% of the electricity in 2002, but a substantial amount of energy is provided from resources—hydro, nuclear, and renewables—that do not produce any fossil fuels. This is a far cry from Alberta, where coal and gas comprised 87% of the electricity supply and cannot readily be replaced with hydro, wind, or other capacity.

Table 4.4: Electricity Consumption in California, 2002

Energy Source Gigawatt Hours Produced Percent of Total

Natural Gas 99,480 36.5%

Coal 54, 483 20.0%

Hydro 48,200 17.7%

Nuclear 40,502 14.9%

Renewables41 29,879 10.9%

Totals 272,544 100%

Source: (Calif. Energy Commission, 2002)

California also sees few costs posed by fossil fuel industries. The coal industry is virtually non-existent in California, which boasts only two small coal plants and very small production inside its borders (less than 1000 gigawatt hours). Furthermore,

California contains no auto production facilities—and therefore the power of Detroit is felt largely at only the federal level. Oil drilling is present, but it is a highly mechanized

41 This includes biomass, geothermal, small hydro, solar, and wind power. 157

process that employs few people—unlike the oil industry in Alberta. As one member of the Assembly put it, ―one thing we benefit from is there is no pushback from the coal industry—they would like to, I‘m sure, but they have no facilities here, and little power‖

(Interview with Assemblyperson).

California also benefits from a high capacity for renewable energy. As indicated by Table 4.5, the California Energy Commission estimates that, based on potential access to renewable resources, 97% of California‘s energy could be derived from non-fossil fuel, renewable sources.42

Table 4.5. Technical Potential for Clean Energy in California

Energy Source Gigawatt hours/year43

Biomass 18000

Geothermal 37000

Wind 44000

Solar 157000

Total Potential Renewable 256000

Energy Production

Total 2003 Consumption 265000

Total 2003 Clean Energy 29000

Consumption

Source: CEC, 2003

42 This of course assumes no further growth in energy consumption beyond 2003 levels. 43 Rounded to the nearest thousand 158

Currently, approximately 29,000 gigawatt hours/year of renewable energy is consumed— the CEC estimates that could grow to 265,000 in the long term. Furthermore, there is a great deal of support for renewable energy development in California. A September 2007 poll found that 66% of respondents said ―if the government is going to invest in an energy solution, it should be in renewable technologies such as wind and solar‖ as opposed to natural gas or coal (―‗Post-Fossil Fuel America‘ Survey, 2007). Clearly, the costs of transitioning away from fossil fuels are much lower in California than it is in

Alberta and other oil- and coal- dependent regions.

A Climate Fruit Picker

Climate policy in California dates to the late 1980s. In 1988, then-Assemblyman Byron

Sher authored legislation directing the California Energy Commission (CEC) to assess the potential impacts of climate change on California and create an inventory of greenhouse gas (GHG) emissions (Calif. Statutes of 1988, ch. 1506). The following year,

CEC issued two reports: Comparing the Impacts of Different Transportation Fuels on the

Greenhouse Effect and the Impacts of Global Warming on California. These two reports began a trend of research and analysis by various departments within the state government aimed at determining the causes and effects of climate change on California.

In 1990, the California Air Resources Board (ARB) created a new regulation requiring a progressive percentage of new care sales to be zero-emission vehicles powered by alternatives to gasoline.

The flurry of activity at the state level in the late 1980s was followed by a period of relative slowness in the 1990s. In 1990, California adopted a Zero Emission Vehicle 159

(ZEV) program, requiring auto companies to produce a certain percentage of zero emission vehicles for sale in California. Focused more on reducing air pollution than addressing global warming, this program underwent substantial revisions in 2001 and

2003, leading to the creation of hybrid and fuel cell vehicles. Activity on climate change picked up in the next decade. In 2000, Senate Bill 1771 passed the legislature, establishing the California Climate Action Registry under the authority of the CEC and the ARB. 2001 saw the creation of several programs aimed at increasing energy efficiency, and in 2003 California joined Oregon and Washington in creating the Western

Climate Initiative to collectively combat climate change. The two most influential climate policies—AB 1493, the Pavley auto emission standards, and SB 1078, a renewable portfolio standard—passed in 2002.

California‘s climate policies from 1998-2004 illustrate its role as a Climate Fruit

Picker. Focused on voluntary programs, cost effective energy efficiency efforts, and creating climate change commissions and networks, these policy options all imposed few costs on a government focused on issues that had more prominence in the mind of the public. Two policies passed in 2002 did propose real costs to California, but as we shall see, they tapped into crucial issues outside of climate change.

One of these Fruit-Picker policies is the Climate Action Registry and Inventory.

Senate Bill 1771 called for the creation of the Climate Action Registry. This non-profit organization is ―charged with annual voluntary reporting of GHG emissions by its member companies and agencies.‖44 More than forty participants from government, industry, and NGOs report and certify their GHG emissions to the Registry. The same

44 Brown 2005 160

legislation also charged the Energy Commission with conducting the third inventory of

California‘s greenhouse gases. Previous inventories were completed in 1990 and 1998

(California Air Resources Board, 2009).

This period was also rife with the creation and improvement of various voluntary programs designed to increase the use of renewable energy and improve energy efficiency. Assembly Bill 1890 and Senate Bill 90 created the Energy Commission‘s

Renewable Energy Program in 1997. Funds from the three major investor-owned utilities were used for public benefit programs ―to provide financial incentives to support existing, new and emerging renewable resources in a market environment.‖ The

Emerging Renewables Resources Account followed in 1998, allocated $54 million to help reduce the cost of consumers who wished to generate small-scale renewable energy.

In 2004, Governor Schwarzenegger created the Million Homes Solar Plan, offering homeowner incentives for installing solar panels.

Efforts in energy efficiency also abounded. In 2001 and 2002, real-time meters were installed for large customers ‗to reduce energy use when the price of electricity goes up‘. Dynamic pricing tariffs followed in 2003. In 2004, the state adopted new appliance efficiency standards for 19 appliances, expected to produce substantial energy savings.

New energy saving targets were adopted in September 2004, requiring that ―investor owned utilities invest first in cost-effective energy efficiency programs to meet incremental increases in overall energy demand.‖ These targets, although voluntary, are expected to save nearly 5000 MW of consumption.

These efforts were accompanied by the Energy Star award winning ―Flex Your

Power‖ energy efficiency marketing and outreach campaign. Initiated in 2001, Flex Your 161

Power is a ―partnership of California's utilities, residents, businesses, institutions, government agencies and nonprofit organizations working to save energy.‖ The campaign includes retail promotions, a comprehensive website, an electronic newsletter, educational materials and advertising.

The third major component of California‘s climate policy at this time was the creation of various task forces, advisory committees, and reports on climate change. In

2000, SB 1771 created an interagency committee called the Joint Agency Action Team and armed it with representatives from state agencies involved in climate change activities. Co-chaired by the State Resources Agency and the California EPA, it issued a series of recommendations for short-term and long-term GHG reduction measures. These measures largely focused on making transportation and buildings more energy efficient, increase use of renewable energy, and assess the impacts of climate change. None of the recommendations called for costly emission caps or other regulations. Similarly, the creation of the Climate Change Advisory Committee at the Energy Commission did not result in aggressive policy recommendations either.

Numerous reports were issued during this time, and most of them specifically addressed climate change. The 2003 Integrated Energy Report, for example, recommended several actions on the issue. These included requiring new electricity generating facilities to report GHG emissions as a condition of state licensing; using sustainable energy designs in state buildings; and requiring state agencies to incorporate climate concerns in their planning documents.

These policies are distinct from similar efforts undertaken in Alberta. In Alberta, various commissions were created but they rarely produced actionable measures in their 162

reports. These reports were also rarely used by policymakers to generate policy ideas

(Interview with Alb. Environment official 1). In addition, the committees were often armed with climate skeptics and representatives of the oil and gas industries. In

California, high-ranking officials at the Air Resources Board and California

Environmental Protection Agency dominated the membership of these commissions and the recommendations in their reports were generally taken seriously by policymakers

(Interviews with ARB official 2 and Assemblyperson).

These policies showcase Californian efforts to pick the low hanging fruit on climate change. Many actors start out looking for the zero- or low-cost measures that allow them to claim action without imposing costs to address an issue for which there are few rewards. Climate change itself generally lacks a ready constituency of voters, and therefore until the issue becomes a higher priority we would not expect to find costly action taken. This is true even in a state like California, which is known for taking the lead on environmental issues. Many states start their efforts on climate change by taking no-regrets measures…but never quite progress past that point.45 California eventually abandoned Fruit-Picker behaviors for Climate Crusading, but this is largely due to the change in public sentiment rather than an innate environmentalism.

As one climate change official put it, ―there wasn‘t much real activity prior to the executive order in 2005. Oh, we put in some policies, created some groups and task forces…but besides the Pavley Bill, there wasn‘t much in the way of leadership back then‖ (Interview with ARB official 2). Indeed, the measures discussed above are hardly those we would expect to find in a climate leader. Creating advisory groups and drafting

45 For example, Arizona, Georgia, Missouri, North Carolina, Nevada, and Texas. 163

reports, adopting efficiency regulations, and taking inventories of greenhouse gases are all important efforts in the fight for climate change—but they are also essentially costless ones, economically and politically. A common refrain in climate-skeptic governments is that the issue needs to be studied more by committees, and the existence of the committee and its report does not mean that action will follow.

The lack of public support for substantial state action on climate change therefore inhibited California‘s tendency to lead on environmental issues. Indeed, as we shall see momentarily, its leadership on one climate issue—auto emissions—offered substantial political dividends on air pollution, the top environmental issue in the state. In large part during this post-Kyoto period, California engaged in low-cost measures that satisfied climate proponents without giving opponents much to protest. There are two exceptions to this, however, and we turn our attention to them now.

Moving from Fruit Picker to Crusader

Two Transitional Policies: The transition in California from Fruit Picker to Climate

Crusader was not automatic. In 2002 we find the beginnings of a transition, with

California adopting two policies—a renewable portfolio standard and automobile emission standards-- as forerunners to its Crusader activities on climate changes. These policies share characteristics with the Fruit Picker policies of the prior period and the

Crusader policies yet to come, and show the changing dynamics in California at the time.

California became the eleventh state in the U.S. to adopt an RPS in 2002. Senate

Bill 1078, authored by Senator Byron Sher outlined a renewable energy target of 20% by

2017. ―Each electrical corporation would be required to increase its total procurement of 164

eligible renewable energy resources by at least 1% per year so that 20% of its retail sales are procured from eligible renewable energy resources.‖ The deadline was later amended in 2006 to speed up the timeline to 2010, and an energy plan under debate in 2009 would set a 33% renewable energy target for 2020. At the time, this was the most aggressive

RPS in the country.46

Assembly Bill 1493, known as the Pavley Bill after its author, Assemblywoman

Fran Pavley, directs the California Air Resources Board (ARB) to ―develop and adopt regulations that achieve the maximum feasible and cost-effective reduction of greenhouse gas emissions from motor vehicles‖ (Calif. AB 1493, 2002) These regulations were eventually adopted in 2004 and require reductions of 22% in 2012 and 30% in 2016 of car emissions against a 2002 model year baseline. These regulations have never been enforced, due first to legal challenges and then their withdrawal in 2009 when the Obama

Administration adopted federal regulations in line with the ARB standards.47

These two policies straddle the line between Fruit Picker and Crusader policies.

As policies that tap into multiple issues outside of climate change and which either take advantage of existing resources (SB 1078) and/or future deadlines (both of them), they clearly engage California‘s desire to be a Fruit Picker. Indeed, the ability to address several issues at once is a hallmark of a fruit-picking strategy. AB 1493, while aimed at addressing global warming, also clearly notes the ‗adverse health impacts from increases

46 In 2002, the most aggressive RPS was in Arizona, which adopted a 15% by 2025 target. Following the California policy, several states (New Jersey, Hawaii, New York, Nevada) created or amended their RPS to match or exceed California‘s commitment. 47 A provision in the US Clean Air Act allows California to adopt standards that exceed those of the federal government, but requires a waiver from the US Environmental Protection Agency. The matter was tied up in the court system for years until finally the EPA denied the waiver in December 2007. Without that waiver, neither California nor the 16 states that have indicated their intention to adopt the standards can enforce the regulations. Legal challenges by California and its allies are ongoing. 165

in air pollution‘ as a potential problem (Calif. AB 1493, 2002). Supporters of the legislation noted that the ability to tie AB 1493 to concerns about air pollution helped win votes, particularly from climate skeptics (Interview with Assemblyperson). SB 1078 continues this tradition, but is even more pronounced as it is largely aimed at issues of energy security. Although typically considered part of California‘s wider climate change program (and indeed, sponsored by a Senator known for his support for climate change initiatives), the words ‗global warming‘ are not mentioned once in the legislation. Nor did the Governor mention climate change upon signing the legislation. Governor Davis said at the time, ―These bills will build upon our state‘s rich tradition of environmental stewardship, protecting the energy we use (and) looking toward new energy resources‖

(Calif. Ofc. of the Governor, 2002). SB 1078 was engineered as a response to the 2000-

2001 electricity crisis in California, and indeed, securing a diversified portfolio of energy resources was a top priority for the Davis Administration. The benefits of SB 1078 to climate change were a decided afterthought (Interview with CEC official). Unlike the top-down system, events are not driven by the Kyoto Protocol. Instead, related issues such as energy security and air pollutions predominated.

California‘s RPS also posed few costs to the state because of California‘s existing capacity for renewable energy. As discussed earlier, the state has a tremendous potential for developing renewable energy and by 2002 without any mandates had already achieved an 11% mix of renewables into its electricity sources. After the electricity crisis, industry and public alike were supportive of efforts to ensure a secured supply of diversified energy. Furthermore, the top three utilities in the state were already expanding their use of renewables by 2002. Southern California Edison was by its own 166

estimates on the path to exceed 20% renewable production by May 2003 and would exceed 20% after that (Beck et al., 2002). San Diego Gas and Electric and Pacific Gas and Electric were also vamping up, and fully expected to meet their targets years ahead of that deadline. Stakeholder consultations prior to SB 1078‘s passing revealed that meeting the goals was not anticipated to be problematic for the major energy companies.

Finally, by establishing deadlines well into the future and past the term limits of most existing policymakers, proponents of the legislation avoided having to pay upfront costs to pay for their policies. Indeed, even conservative commentators recognized this advantage of SB 1493:

On the politics, the bill is a no-loser. Despite all the accolades from the national

press, the bill itself doesn‘t include tough new regulations. It passes the buck to

the Air Resources Board to write new rules by 2005. So Davis gets kudos for

signing a bill with tough new regulations, even though it doesn‘t include any

regulations at all. And there‘s no real downside. Consumers won‘t see their

buying opportunities limited until 2009 model cars are out. By then, Davis will

have had a chance to run for re-election, and if he wins, the White House.

(Saunders, 2002)

But these bills also show clear signs of Crusader behavior, which we would not expect for policies passed when concern about global warming barely registered on existing surveys. Both pieces of legislation were designed with a clear eye to influencing policies in other states and even at the federal level. AB 1493 notes that ―California has a long history of being the first in the nation to take action to protect public health and the 167

environment,‖ and policymakers readily admit to being aware at the time of the potential implications of the policy for their peers (Calif. AB 1493, 2002; Interviews with Calif. state senator and Assemblyperson). Both policies showcase leadership. AB 1493 is uniquely Californian, in that California is the only state with the authority to regulate air emissions. More than a dozen other states would eventually move to adopt the California standards before they were made obsolete by federal policy in 2009. In addition, while

California was the eleventh state to adopt an RPS—and therefore hardly a frontrunner, as the policy had been around for more than ten years at the time—it adopted the most aggressive standard in the United States, creating a precedent for adoptions by other states in the years that followed.

There are two explanations in keeping with our expectations that explain why these two issues straddle the line between Fruit Picker and Crusader. The first is that while public concern for global warming overall was low, public support for these particular pieces of legislation was very high—over 80% in both cases. The second is the existence of a policy champion who navigated the controversial AB 1493 through the legislature and into law.

As we discussed earlier in the chapter, public concern for climate change was low. Environmental issues were cited by less than 1% of respondents as the ‗biggest issue‘ of concern, and even in surveys that asked about the most important environmental issues it was cited by less than 1% of the public. However, the other issues that these pieces of legislation tied into were hugely popular. Air pollution—addressed by AB

1493—was the top environmental concern for 33% of the public, while electricity supply was cited by 56% of respondents as the most important issue overall. Proponents of both 168

bills were careful to focus on the benefits to air pollution and electricity security when they argued for the votes of their colleagues (Interview with Assemblyperson). Indeed, they had powerful evidence to use to win this support. The PPIC‘s Special Survey on the

Environment in July 2003 specifically asked about the two pending bills. 85% (including

82% of Republicans) said they favor ―a state policy that requires doubling the use of renewable energy—such as wind, geothermal, and solar power—in the next ten years from ten percent of all California power today to 20 percent.‖ In addition, 81% of respondents approved of ―a state law requiring all automakers to further reduce the emissions of greenhouse gases from new cars in California by 2009‖ (Baldassare, 2003).

This included 67% of those who said that more research was needed on climate change before action was taken or that concern about global warming was unwarranted, and 77% of respondents who drove an SUV. Clearly, AB 1493 was tapping into concerns that went well beyond climate change. And indeed, it was after seeing the results of this survey that Governor Davis, who previously opposed AB 1493, threw his support behind the legislation (Interviews with Assemblyperson, Senate comm. staffer, Senate staffer).

Thus, both pieces of legislation had specific, targeted support from the public which could be brandished by supporters to support their case. While support for action on global warming was low (only 25% at the time supported taking immediate steps to fight climate change), the high approval for these specific bills reduced concerns that policymakers would be punished by voters for their support. The ability of these bills to tap into multiple issues with concrete evidence of support helps us understand why two pieces of Crusader legislation shows signs of Fruit Picker behavior.

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Another reason why these bills made an early debut prior to the onset of concern about global warming was due to the efforts on their behalf of a Policy Champion.

Assemblywoman Fran Pavley is universally assigned the credit for pushing AB 1493 through the legislature despite efforts by opponents to kill the bill. Ahead of the curve in her concern about climate change, Pavley was determined to move California from its status as a Fruit Picker to a Crusader. AB 1493 was her first success, and California‘s comprehensive cap on emissions in 2006 would be her second.

As one witness to the process claimed, ―1493 was a tremendous fight. Legendary.

The oil companies were engaged, (and so were the) car dealerships. The chamber of commerce was strongly opposed. Conservative talk shows spent a lot of time trying to kill this regulation…they used unbelievable scare tactics, stirred up the public with misinformation and factually incorrect statements‖ (former Calif. state assemblyperson, personal communication, January 25, 2008). Pavley countered these efforts by holding hearings all over the state focused on ―understanding the direct impacts of the legislation on California—related specifically to California, not just what was happening in far away places.‖ Pavley‘s ability to harness the support of the public (as embodied in the PPIC polls) and get their blessing went a long way to shape the nature of the debate on the legislation. She ―showed the leaders that a constituency existed for stronger action‖ on the issue, and ―deserves a lot of the credit‖ for its eventual passage (Interviews with ARB officials and Senate staffer).

Pavley‘s efforts were recognized publically as well. As an editorial in the San

Francisco Chronicle cited, ―the heavy lifting on the bill was performed by its author,

Assemblywoman Fran Pavley, a Los Angeles County Democrat who personally 170

buttonholed and cajoled her colleagues at a time their phones were ringing with calls from constituents who had seen the industry‘s shamefully deceptive scare advertising campaign.‖ Russell Long, executive director of Bluewater Network, a San Francisco- based environmental group noted that ―Clearly, Pavley…is the hero of the story‖ (―Gray

Davis,‖ 2002). Pavley‘s ability to sidestep the lukewarm support for global climate change action and galvanize interest in other locally important issues is what made AB

1493 possible in a state still committed to climate Fruit Picking. Her abilities as a climate policy champion would be called into service again in 2006, when the fight over AB 32 would begin.

These two issues mark the beginning of comprehensive climate policy in

California and the onset of its role as a Climate Crusader, a role that the state would step into more firmly in 2005.

California the Climate Crusader: 2005-2008

In 2005, California shifted its focus from Fruit Picker policies to Crusader policies. That is, the state embraced aggressive policies and a comprehensive, all-sector approach to climate change, and then marketed those policies to other states, the national government, and even other countries.

The principal policy marking this shift was the adoption of a comprehensive set of greenhouse gas targets and emission caps. In 2005, the governor issued Executive Order

S-3-05 establishing targets for the reduction of greenhouse gases, calling for reaching

1990 levels by 2020 and 80% below 1990 levels by 2050. In 2006 these targets were made law through the passing of the Global Warming Solutions Act (AB-32) which also 171

directed the Air Resources Board to adopt regulations designed to achieve the new targets.48 Through these efforts, California became the first state in the U.S. to adopt a binding cap on emissions in all sectors of the economy.

A Higher Priority Issue

According to our typology, for California to move from no-regrets measures to

Crusader level activity, the priority of climate change as an issue would need to increase dramatically. And indeed, this is exactly what happened in the state starting in 2005. As one policymaker noted, ―it‘s been a really dramatic sea change‖ regarding willingness to consider aggressive climate policies (Interview with Assemblyperson). Various forces coalesced in 2005-2006 to raise climate change to a prominent place on the agendas of the public, industry, and policymakers alike. Increasing evidence of local impacts of climate change, increased media activity emphasizing scientific reports noting an increased certainty about climate change, and the economic impacts of climate action around the world all influenced the public and policymakers, making aggressive Crusader action a possibility in California.

Perhaps the most crucial factor creating a readiness to consider taking on a

Crusader role was the increased visibility of natural events and disasters that were

(correctly or not) linked to climate change. Droughts in the central valley from 2003-

2009 have led the Governor to declare states of emergency, noting in June 2008 that rainfall in 2007 was at 20% of normal and reservoirs were at barely 50% capacity (Calif.

Ofc. of the Governor, 2008). Indeed, as more than 20 million Californians get their

48 The Scoping Plan determining how exactly California would meet these required targets was adopted in 2008 and is currently undergoing implementation. 172

drinking water from snow melt in the Sierra Nevada mountain range and snowfall has been steadily decreasing in recent years, concerns about droughts and water shortages have become quite evident in California (Moore & Douglas, 2006). Wildfires, usually a two month danger in California, started to become a year-round concern in 2003, when more than 4,000 fires caused more than $2 billion in damage. In 2005, southern

California alone had 1,300 fires by July that burned 91,344 acres. A fire in September

2005 outside of Los Angeles added another 16000 acres burned. As one policymaker noted, ―this was once a two-month affair. Now we worry about it year-round‖ (Interview with Assemblyperson). An official at the Air Resources Board noted that, ―we are already suffering the effects of climate change. There are massive droughts and floods…this may drive things more than anything‖ (Interview with CAT staffer).

Tony Leiserowitz, an environmental policy expert at Columbia University‘s center for research on environmental decisions, conducts survey research on climate change. He notes that Americans are frequently ambivalent about addressing global warming because, ―more than half of Americans are under the false impression that only poor countries will deal with its most serious consequences.‖ Once Californians began experiencing some of these consequences, this ambivalence decreased dramatically

(Craig, 2008). Indeed, the visibility of the droughts and wildfires has helped policymakers move forward on the issue. One environmental activist noted, ―on this issue visibility is crucial. It‘s only when people see the impacts—of global warming or our solutions—that they begin to care‖ (Interview with Kyoto Now member). This is even more important in areas where people are generally skeptical of climate change. A member of the ARB argued that the prevalence of natural disasters in California in recent 173

years has been crucial in changing the minds of conservative voters in hard-hit areas.

―The central valley is key—they are the most conservative and question climate change more than anyone, but they are also the most affected— by flooding, by the heat. The air quality. This is starting to impact climate change perceptions in the region. Minds are more accepting in the region now‖ (Interview with CAT staffer).

Droughts and wildfires were not the only events that started to change peoples minds. In 2005, Hurricane Katrina provided an initial focal point for climate change advocates wanting to demonstrate the possible effects of global warming to a skeptical

California public. The intensity of the hurricane and its damage and the inability of government to aid the victims generated discussion of global warming and its potential ramifications. Although scientists continue to debate the effect of global warming on the frequency and intensity of hurricanes, the event became a focal point for people were previously unaware of this potential aspect of the global warming problem. California was viewed as particularly vulnerable to storms and flooding, and thus the events around

Katrina made some in California more willing to consider stringent climate change legislation (Interviews with Senate comm. staffer, ARB official 1, Senate staffer, and ED official).

Another factor given credit for changing public and policymaker opinions on climate change was in the media. Media reports on climate change citing scientific reports by the IPCC and showing pictures of evaporating polar bear populations tugged at heartstrings and started to convince skeptics that there was a scientific consensus on the existence and causes of climate change. Meanwhile, the release of former Vice President

Al Gore‘s documentary An Inconvenient Truth had a widespread impact on viewers. 174

One policymaker noted that both the public and businesses became more interested in solving climate change once the media got on board.

The media started to put it consistently in the newspapers, magazines, tv, making

it more and more visible. Finally we had tangible, visible proof that people could

see—the polar bears plight, the weather patterns, our droughts and hurricanes.

Wildfire season was now year round, not just two months in the fall. The IPCC

put out its reports of annually growing evidence, showing that the rest of the

world was moving ahead, Europe in particular. The idea grew—we had to do

something. (Interview with Assemblyperson)

Furthermore, editorials in the San Francisco Chronicle were no longer limited to Debra

Saunders‘ skeptical views of global warming and the Kyoto Protocol. In an August 2006 editorial entitled ―Yes, it is California‘s Issue,‖ the newspaper came out in support of AB

32, citing ―a growing body of scientific evidence strongly suggests…that global warming is a genuine threat. Our need to act goes beyond our moral obligation to future generations.‖ While prior to 2002 few papers mentioned climate change as a pressing public policy concern, by 2005 it became a common feature of the opinion pages. At the same time, the release of various reports by the IPCC and Nicholas Stern, a British economist, arguing that a scientific consensus on climate change existed, that action needed to be taken, and that the cost of not acting would be very high were extensively covered by the media and led to an increased interest in climate change action in

Californian policymaking circles (Interviews with Assemblyperson, Senate comm. staffer, CALEPA official, CAT staffer). 175

Policymakers also point to the documentary An Inconvenient Truth as extremely helpful in changing public perceptions about global warming. In the film, former Vice

President Al Gore presents a slideshow on global warming indicating the anthropogenic nature of the danger and its potential effects. The documentary was released in May

2006 and became the 4th largest grossing documentary of all time earning $49 million at the worldwide box office and winning an Academy Award. Al Gore eventually won a

Nobel Peace Prize for his work on climate change. The film itself received widespread attention in the media and from policymakers and is consistently cited as the ‗tipping point‘ on awareness of the global warming problem (Interviews with Senate comm. staffer, ARB official 1, Senate staffer, ED official, Assemblyperson). Indeed, almost every interview subject mentioned the documentary as a positive catalyst for action. One official noted, ―Gore had a big influence on the public… Gore‘s movie was a real turning point—the legislators saw that, and they sort of woke up to the issue‖ (Interview with ARB official 3). Another said that, ―credit goes to Al Gore and the movie. It really made (global warming) a mainstream topic‖ (Interview with Assemblyperson). Officials in Berkeley argued that ―the role played by Al Gore can‘t be understated. His winning the Oscar and Nobel prize were just icing on that cake‖ (Interview with Mayoral advisor).

Another said that the movie was instrumental in pursuing Measure G. ―After An

Inconvenient Truth came out, we realized we needed to move, to galvanize support. We had considered waiting, but it was clearly a good moment to move‖ (Mayoral staffer).

The release of the movie in many ways provided a ―window of opportunity‖ for action by policymakers while concern about climate change was fresh in the minds of the public.

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A final reason why opinions turned around in 2005 and 2006 was activity elsewhere in the world. As the Europeans and Canadians began adopting policies early in the decade, American businesses realized that to compete in these countries, they would need to adhere to their environmental rules. Without aid from governments in the

U.S., competition would be tough. Policymakers noted that businesses started coming to legislators in California asking for more stringent legislation so they could focus on making products that could be sold in overseas markets. One legislator recalled that ―the bigger business community that trades internationally, they were starting to have to meet these regulations and targeted reductions and manufacture products that meet these guidelines. The CEO of General Electric said at a conference in 2007 that (by supporting

California‘s legislation, AB 32) he is protecting his shareholders and ensure that GE is making products that they will be able to sell in the US and overseas‖ (Interview with

Assemblyperson).

Visible impacts, media and scientific reports, and economic events around the world all resulted in an increased willingness of the public and policymakers to support comprehensive, aggressive legislation on climate change. This is evident by the change in poll numbers in the PPIC Special Survey on the Environment. As we can recall, the early years of this survey featured no special discussion of climate change as an issue; indeed, when asked the most pressing environmental issue, less than 1% of respondents mentioned global warming. By July 2003, global warming registered on the survey, but with only 1% of respondents naming it as their top concern. By 2006, however, this inattention had begun to change. In 2005, global warming and energy received its own section in the survey; previously, it was included as one of several ‗public policy issues‘. 177

Energy issues were cited as the 2nd most important environmental issue facing California.

Air pollution remained number one, but vehicle emissions were cited by 42% of adults as the most likely source of air pollution. By now, 86% of people believed climate change will affect current or future generations, and 57% believed the effects are already being felt. 75% say that the effects of global warming on the economy and quality of life for

California‘s future are very or somewhat serious. Policymakers did not forget the usefulness of asking about specific legislation, either. When asked, 69% of adults (and

71% of likely voters) indicated support for the greenhouse gas targets announced in the

Governor‘s executive order; 55% expressed support for a hydrogen highway, and 76% for a ‗plan that provides incentives for placing one million solar energy systems on new and existing homes and businesses and that requires that 50% of new homes are built with solar energy systems by 2018.‖ 73% expressed support for requiring automakers to improve the fuel efficiency of cars sold, even if it increased the cost of a new car.

These numbers continued to increase in 2006. By then, global warming was named the third most important environmental issue, with 8% of the responses, behind air pollution (24%, down from 33% in 2000) and energy (up to 12%; previously 0 in 2000 and 6% in July 05). 63% now said that the effects of global warming have already begun, compared to 57% in 2005. 79% said it is very serious or somewhat serious. This is the first year that respondents were asked if they favor or oppose California making its own polices separate from the federal government (a sign of moving into Crusader status): 65% approved. 65% also approved the 2005 executive order and 78% noted their continuing approval of AB 1493. 83% now indicated their support for ‗spending more

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government money to develop renewable energy such as solar, geothermal, and wind power.‖

By 2007, global warming was cited as the top environmental issue by 11% of respondents, a far cry from the 1% in 2003. In previous years, climate change was discussed as a separate issue from general public policy concerns, but always after air pollution. In 2007 this changed, with climate change now the first issue discussed in the survey. 82% now said that the threat of global warming is very or somewhat serious.

Only 15% total say it is s not too serious or not at all serious, down from 22% just two years before. 84% and 78% respectively claim support for AB 1493 and AB 32. By

2008, climate change was cited as the second most important environmental issue after air pollution.

These polls were used extensively by policymakers to generate support for AB 32 and its implementation. Just as Governor Davis signed onto AB 1493 after seeing the

2003 polls, opponents of AB 32 found little reason to oppose continued action on climate change. Indeed, in one case, polling data and other indications of support were used to get a mandate for action.

In 2006, after noting the increased support for climate action following the release of An Inconvenient Truth, the mayor‘s office in Berkeley decided to put climate change on the November ballot. ―Measure G‖ proposed an 80% reduction in greenhouse gas emissions by 2050 with short term measures to be developed to meet that ultimate goal.

It received 81% support of voters in the city, and from that point on became a mandate and a command from the people for strong action. Measure G, like the PPIC survey for the state, serves as a public mandate that policymakers can and do reference as they move 179

forward with their climate policies (Interviews with Mayoral advisor and Mayoral staffer).

It is clear, therefore, that the increase in public attention to climate change created a willingness and even eagerness for policymakers to act on that support and create comprehensive climate change policies. But their efforts did not stop in California.

Indeed, as we shall see, California designed its policies with exportation in mind, and took on the role of a true Crusader, attempting to actively diffuse its policy to other states, the national government, and even other countries.

California: A Climate Crusader: We have already discussed the roots of California‘s

Crusader activities with the creation of AB 1493 and SB 1078. Add in AB-32 and we have clear evidence of California‘s attempts to not only design comprehensive, aggressive policies for itself, but to take the lead in formulating American responses to climate change.

California was clearly committed to designing its policies in ways that would allow them to be exported. The initial policies did not include lengthy regulations, but focused on easy-to-digest elements—targets for greenhouse gas emissions or renewable energy, or a commitment to creating new auto standards. Emulators could adopt a similar target and then tweak the regulations to suit their own local needs. AB 1493 in particular was designed with exportation in mind, as several states had indicated to Californian officials that they would follow any regulations that California adopted (Interview with

ARB official 1). Some noted that AB-32 itself was designed as a message to the federal government, proclaiming California‘s willingness to be a model for other states if the federal government failed to do so. ―AB-32 is to a great and deliberate extent aimed at 180

the federal government. It was born out of the lack of action from national government and is designed to show leadership on this issue‖ (Interview with ARB official 2).

California‘s efforts did not stop with the design of their policies, however.

Indeed, the state actively promoted its policies to other states, the federal government, and other countries. Californians regularly attended the Conferences of the Parties on the

Kyoto Protocol, presenting the results of their efforts. Officials are regularly brought to other states, Canadian provinces, and European countries to help governments at the state and municipal level create aggressive climate change action plans. Delegations from around the world also visit California to learn from officials there. And the Governor has used his status as a celebrity to travel the world and encourage California-style action on climate change. Indeed, the European Parliament paid homage to the Governor and its state in 2008, when the environment committee voted to adopt a ―Schwarzenegger- clause‖ on coal, imposing carbon emission standards on new coal-fired power plants

(Murray, 2008).

California is very consciously pursuing this role of Crusader, trying to spread its policies around the world. One official put it thus: ―California is doing this not only to

‗do its part‘ but to be a leader and a catalyst for others. California has been successful in the past at exporting its goals and policies and hopes to do so on this issue….there is a great interest in communicating California action‖ (Interview with ARB official 2). State

Senator Darrel Steinberg, sponsor of SB 375 which targets land use development, argued that he intends to push discussions on climate change around the country in the direction of land use. When asked about Florida‘s interest in adopting a similar law, he responded,

―we‘re not going to launch our national campaign until we pass the state law, but the fact 181

of the matter is that this is cutting-edge…I‘m very heartened to hear that the word has already traveled across the country‖ (Abel, 2007).

The state has also targeted federal government policies, noting that it has had success in the past at making its standards the model for national behavior.49 Senators

Boxer and Feinstein along with Congressman Harvey Waxman have sought leadership in

Congressional environmental committees and sponsored legislation that would make

California‘s policies into national law. Indeed, the clearest evidence of the influence of

California on federal policy can be found in the language of the 2009 climate bill endorsed by Obama. As a representative of the Sierra Club said, ―California‘s fingerprints are all over it…you look at the major components of this legislation and you see the leadership California has provided over the last eight years‖ (Baker & Stannard,

2009). An editorial from the conservative Competitive Enterprise Institute concurred, remarking in its response to the legislation, ―as goes California, so goes the nation.‖ And

Representative McNerney, noted that the Californian congressional delegation was crucial in promoting the passage of the bill: ―We wouldn‘t have gotten this done without the delegation‖ (Baker & Stannard, 2009). Indeed, sections of the law read as if they could have been lifted directly from California‘s legislation.

Indeed, individuals in California have played a key role both in generating legislation and policy within the state as well as exporting it to other governments.

Policy Champions in California have driven the state‘s transformation from Fruit Picker to Climate Crusader. In the top-down model, federal pressure to adopt policies in line

49 California‘s initial appliance efficiency standards of the 1970s were later adopted as the national standard. 182

with commitments to the Kyoto Protocol kept climate change at the top of the agenda in provinces like Alberta. In the bottom-up model, we rely on policy champions to fulfill that role.

The Crucial Role of Policy Champions in California

In their book Cities and Climate Change (2003), Harriet Bulkeley and Michele

Betsill argue that one key to the development of local climate policy is the existence of an individual—a mayor, a member of the city council, or a well-placed bureaucrat—who adopts climate change as a sort of personal crusade and keeps the issue on the local agenda. This holds true at the state level in California, where climate policy benefited from the existence of highly ranked and heavily invested actors who were willing to stake their reputations on the climate issue. Without the dedication of these actors, it is less likely that strong policy would have been passed in 2006. The earliest plans for climate change, passed in 1988, were the brain child of then-Assemblyman Byron Sher. The lack of action in the 1990s is attributed by some officials to two factors: disinterested governors in Pete Wilson and Gray Davis, and the lack of a dedicated leader in the legislature (Interviews with Senate comm. staffer, Analyst, Senate staffer). The movement from Fruit Picker to Crusader can be credited to attentive and proactive Policy

Champions. Two actors in particular stand out for their efforts: Assemblywoman Fran

Pavley and Governor Arnold Schwarzenegger.

Pavley, a three-term state Assemblywoman and former mayor of Agoura Hills, is credited with authoring and pushing through the two most important components of

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California‘s climate policy: AB 1493 and AB-32.50 The first bill, named the Pavley Bill after her efforts, required a two-year fight in the legislature to pass and despite being held up in the US court system generated widespread action outside of California. Nineteen states indicated their intention to adopt the Pavley standards for automobile emissions before the waiver was eventually granted in 2009, and fifteen of those states joined

California in a lawsuit against the federal government for denying the needed waiver.

AB-32 was also passed largely due to her efforts to generate support in the legislature and fight back against media campaigns by the opposition. Her co-sponsor, Speaker of the

House Fabian Nuñez, only signed onto the bill once the votes were secured for passage, but it was Pavley who did the legwork to acquire the needed votes and reassure stakeholders about the bill‘s intentions. As one state Senator put it, others take credit ‗but

Fran pushed it through‘.

Governor Arnold Schwarzenegger can also be given a great deal of credit for

California‘s climate policy. He played two key roles: first, as a symbolic supporter; and second, as a policy initiator. Since he challenged then-governor Gray Davis in the 2003 recall election, Schwarzenegger has traveled around the world talking about climate change and the need to adopt strong policies—though preferably ones that would allow people to keep their Hummers. His travels and strong words created an expectation that aggressive climate policy in California would soon follow (Interviews with Senate staffer, CALEPA official, CAT staffer, CEC official). Indeed, by the time he issued his

Executive Order in 2005, the Governor‘s reputation as a leader on environmental issues

50 In every interview where I asked if there was any particular individual who could be credited with California‘s new climate policy (as opposed to strictly a collaborative effort), Pavley was named. 184

hinged on pushing strong legislation through California. The high-profile nature of the former actor pushed climate change into the minds of the public and onto the agenda of the legislature much more quickly and efficiently than Pavley was able to do several years before. Furthermore, the Executive Order itself created high levels of momentum for the Global Warming Solutions Act. It created the Climate Action Team and pushed the bureaucracy to start working on the issue; for some officials in the Cal-EPA, AB-32 was simply a formality, though a necessary one (Interviews with ARB officials 1 & 2).

Policy champions such as Pavley and Schwarzenegger were vital to the effort to create climate policy in California. Climate change, after all, is an issue that lacks a natural constituency among voters. The effects of climate change—from warmer temperatures and rising sea levels to the potential for larger disease-carrying insect populations and more intense storms—are distributed throughout the population, creating a collective action problem around which politically able groups may be unable to gather.

Meanwhile, many of the groups that benefit from inaction on climate change—the oil, coal, and automobile industries—are very well organized and provide a great deal of funding to politicians. Strong, committed leaders—willing to work with these groups and potentially alienate them—may be needed to overcome this problem.

In California, Pavley and Schwarzenegger fulfilled this role. Pavley‘s efforts in pushing AB-1493 past substantial opposition forced the climate issue onto California‘s agenda and later efforts at passing AB-32 kept it there. Several observers noted that

California‘s noted environmentalism was not enough to put climate change at the forefront of the legislature‘s agenda, though it was something Pavley took advantage of in her push to get 1493 adopted (Interviews with Assemblyperson, ED official, Calif. 185

State senator). The Governor‘s 2005 Executive Order and AB-32 called for aggressive standards on emissions, well beyond levels suggested by federal standards, other states, or the existing Kyoto Protocol. Had the governor and legislature suggested a more modest target (such as the 7% assigned to the United States by the Kyoto Protocol) it would have disappointed environmental groups but probably would have satisfied the general public. Adopting an aggressive, challenging, and costly target on par with what scientists suggested would be required to fight global warming would have been much more difficult without champions in both the governor‘s office and the legislature.

Finally, several high-ranking officials noted that the governor‘s personal interest in the progress of AB-32 ensures that implementation moves forward on track (Interview with ARB official 1). The governor spends substantial time during Cabinet meetings discussing the process and in 2007 replaced his Chairman of the Air Resources Board when he deemed progress on the bill‘s early action measures to be insufficient

(Interviews with ARB officials 1 & 2). One official noted that the governor‘s commitment to addressing the climate change problem in economically beneficial ways was taken as a ―command‖ by the bureaucracy. His commitment to the reduction targets and his willingness to devote funding to their achievement has been crucial to keeping the bill‘s implementation on track. In fact, the January 2008 budget crisis in California resulted in almost no cuts for the proposed 120 positions in the Air Resources Board and

Cal-EPA related to climate change—even though the Legislative Analyst‘s Office recommended substantial cuts. One analyst in that office suggested that this reflected the governor‘s and legislature‘s clear commitment to AB-32 and climate change more generally (Interview with Analyst). A governor with a less personal and publicized 186

commitment to addressing climate change might have found the climate positions an easy cut at such a time.

It is clear, therefore, that the personal interest that Pavley and Schwarzenegger took in the climate issue contributed highly to the creation and implementation of strong climate policy. Absent their influence, the climate issue may never have made it to the top of the agenda, or else a much weaker version of the emission targets might have been passed and then, perhaps, left to remain unfunded and unmet. Indeed, in a bottom-up model Policy Champions play a crucial role in generating action, moving their states from Fruit Pickers to Crusaders.

* * *

By 2005 it is clear that California had transcended its origins as a Fruit Picker, focused only on low cost policies that solve multiple issues at once and transformed into a Crusader, creating comprehensive, aggressive policies and marketing them to other states, countries, and the US national government. As we have seen in this chapter,

California‘s costs of addressing climate change were low following the creation of the

Kyoto Protocol, but interest in the issue amongst the public and the bulk of policymakers was low until 2005-2006, when various elements conspired to put it at the top of the policy agenda. In addition, policy champions such as Fran Pavley and Arnold

Schwarzenegger played a crucial role in keeping the issue at the top of the agenda and taking advantage of the moments of opportunity in 2002 and 2005 as they presented themselves.

In the next chapter, we will analyze the top-down and bottom-up models and their ability to produce successful action on climate change. We will revisit the cases of 187

Alberta and California in this context and will also widen our view to consider other states and provinces. The chapter also concludes this project noting the next steps for future research.

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Chapter 5: Sub-national Policies in Top-Down and Bottom-Up Systems

In the preceding two chapters, we presented extensive case studies of policymaking in Canada and the United States, focusing on sub-national policymaking in

Alberta and California. The top-down model showcased by Canada and Alberta until

2006 resulted in limited policy experimentation and innovation as provincial governments operated within the confines of a federal commitment to the Kyoto

Protocol. The bottom-up model as represented by the United States and California (and post-2006 Alberta) provided more flexibility to governments, allowing them to engage in widespread policy innovation and emulation of best practices.

In this chapter we compare these two case studies on two dimensions. First, we take an in-depth look at the characteristics of top-down and bottom-up policymaking. In chapter two we argued that the restrictions of the Kyoto Protocol created certain incentives for policymakers to create policies limited to direct, short-term efforts.

Bottom-up environments, however, offered more flexibility, allowing indirect policies with longer time horizons. Here, we look at the evidence presented by our two case studies to determine whether or not our expectations have been met. Second, we compare policymaking at the federal and sub-national levels and determine that while the federal governments pursued weak, ineffectual policies, sub-national governments in both countries engaged in widespread policy experimentation and innovation. In

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addition, although the United States is frequently mentioned as the worst climate culprit, on several measures Canada has performed much worse than the United States in addressing climate change. Clearly, participation in the Kyoto regime does not necessarily correlate with success in addressing climate change.

Canada and the United States: Comparing the Top Down and Bottom Up Models

In chapter two we established that the commitments required by the Kyoto

Protocol created certain restrictions for their member governments. These restrictions— to adhere to a binding target for emission reductions to be achieved by a particular deadline—seemed mild, and indeed were coupled with numerous mechanisms to provide for flexibility in meeting them. However, the commitments led to a particular incentive structure for sub-national policymakers wrestling with federal commitments to the international regime. This incentive structure, we argued, would lead to policies that were characterized by their directness, their short time horizon, and lack of innovation.

Alternatively, policies in bottom-up environments could be characterized as indirect, innovative, and focused on longer time horizons. In this section, we look at the evidence presented by the wider cases of Canada and the United States to see if our expectations are borne out.

The Top Down Model

In the top down model represented by Canada from 1998-2006, we would expect to find policies that are direct, have short time horizons for implementation, and lack innovation. As we shall see, policies in Alberta and other provinces in Canada do indeed share these characteristics. 190

Direct Policies: Direct policies, as discussed in chapter 2, have emission reductions as their primary goal. Examples include setting greenhouse gas emission targets, adopting a carbon cap or offset, shutting down coal plants, or engaging in carbon capture and storage. These types of policies were adopted much more frequently in pre-2006 Canada than indirect policies of carbon taxes or renewable energy portfolio standards.

In Alberta, for example, policies are largely aimed at direct action on emission reductions. The Taking Action Plan and the Carbon Emissions Management Act both focus on Alberta‘s greenhouse gas targets-a 50% reduction in greenhouse gas intensity based on Gross Domestic Product. While the intensity target represents a weak approach to achieving real reductions, it still falls into the category of ‗direct‘ action on climate change. This is the cornerstone of Alberta‘s approach to addressing climate change.

There are indirect policies that are included in the 2002 plan, such as the building of stakeholder networks and renewable energy goals, but the intensity target is touted consistently by officials as the principal way they plan to address climate change, as expected in a province facing the binding commitments of the Kyoto Protocol.

Direct policies are also the primary choice of the other provinces. In 2004, for example, Ontario agreed to close down all of its remaining coal-fired power plants. Eight provinces—including Alberta, British Columbia, Manitoba, New Brunswick, Nova

Scotia, Ontario, Quebec and Saskatchewan—adopted greenhouse gas targets, another direct policy. Ontario created the Drive Clean program, a mandatory emissions-testing programme designed to get the worst 10-20% of vehicles off the road. Several provinces and territories including the Yukon and Nova Scotia adopted GHG inventories while 191

others have focused on creating public-private partnerships, such as Newfoundland and

Labrador. Indeed, there are only a few examples of indirect policy in Canada at the time: two provinces adopted RPSs before 2006, and British Columbia began discussing implementing a carbon tax policy in 2000 (though it would not become law until 2008).

Short Time Horizons: In chapter two, we argued that the Kyoto Protocol‘s call for achieving reductions over the 2008-2012 commitment period led to top-down states having shorter time frames for their policies. This means that states are likely to adopt policies with short implementation periods—such as shutting down coal plants or adopting an emissions target with 2012 as a deadline—as opposed to policies with longer time horizons that would require many years beyond 2012 to have impacts on emissions.

Indeed, one of Alberta‘s complaints about the Kyoto Protocol was the short time frame in which reductions would need to be completed. As Premier Klein asked, ―why must Canadians accept artificial, rushed deadlines imposed by the PM when the magnitude of the issue demands thought, collaboration, and common understanding?‖

(Alberta Hansard, November 11, 2002, pg. 1450).

Alberta‘s own plan reflects this desire for a more long term approach. Their emission targets, rather than adhering to the 2012 deadline featured in the Kyoto

Protocol, focused on achieving initial reductions by 2020 and further reductions by 2050.

The 2002 Plan, Taking Action, outlines future measures that will be considered but with a leisurely timeline. There is no sense of urgency in Taking Action; the document itself claims it intends to set ‗a realistic timeframe to reflect technology lead times and expected time to replace capital stock‖ (―Taking Action,‖ 2002). 192

However, it was Alberta‘s very protestations against Kyoto that led it to pursue a longer term approach. The province‘s attempts to reject the Protocol demonstrate the pressure that the province was under to act quickly. And in fact, Alberta did succumb to this pressure despite its objections. For example, the province adopted its intensity targets in 2002, mandating that industries either reduce their emissions or pay into a fund by the end of 2007.

Albertan officials felt pressured to adopt policies that would have an impact in the short run, in order to show that they were not completely ignoring climate change. For example, Minister Taylor, who on several occasions expressed his skepticism that climate existed, responded to one MLA‘s support of Kyoto by saying, ―No, I don‘t think Kyoto is the appropriate instrument, period….Because we will not get there by 2010. The first measurement period is 2008 to 2012…That does not mean that climate change is unimportant. What it does mean is that Kyoto is not the way to address it‖ (Alberta

Hansard, April 18, 2002, pg. 804). Even the skeptics felt pressured to at least pay lip service to the idea of acting on climate change. And as discussed earlier in the chapter,

Alberta did indeed act on climate change in the short term, despite its objections.

Rather than focusing its energy on the long term solutions it preferred, Albertan policymakers felt compelled to adopt short term policies as well in order to stave off political backlash from a federal government determined to meet its Kyoto commitments.

This influence can also be seen in other provincial policies, notably greenhouse gas targets. While many US targets adopted during this period included goals for 2050 or a generic ‗in the long term,‘ Canadian policies tended to focus on 2012. No provinces at this time adopted policies aimed at 2050 or an undefined long term. Manitoba, for 193

example, adopted targets for 2010 and 2012; Saskatchewan for 2010; Quebec for 2012,

New Brunswick for 2012 and 2020, and Nova Scotia for 2020. Even Ontario‘s decision to phase out coal-fired plants set a deadline for 2012, later revised first to 2007 and then

2009.

Policies Lacking Innovation: The third feature of top-down policies discussed in chapter two is that this environment breeds little innovation of new policy ideas. Instead, we find more mainstream and traditional policies with years of adoption history behind them being replicated in top down systems. These include adopting GHG targets, creating advisories and commissions, conducting a GHG inventory, or adopting energy efficiency standards for buildings. Indeed, there are few incentives for innovation in sub-national governments that would frequently prefer to engage in no policymaking on the issue lest their efforts lead to a transfer of wealth to other provinces or states. In addition, sub- national governments are more focused on fighting federal intrusion into what they view as provincial jurisdiction to engage in policy experimentation on the very issue under discussion.

Policies in the Canadian provinces tend to emulate the mainstream policies adopted elsewhere, either in Canada, the United States, or Europe. Eight provinces, for example, adopted greenhouse gas targets similar in structure to the standard set by the

Kyoto Protocol: they all name a specified percentage reduction, a baseline year for the reduction, and a deadline period. But by 2006, no provinces had set emission targets exceeding or even comparable to the 6% Kyoto target. Quebec came the closest, by calling for what amounted to 1.5% below 1990 levels by 2012. Ten provinces pursued 194

energy efficiency policies, including New Brunswick, which adopted new regulations for government buildings in 1999, and the Yukon, which provided ‗green mortgages‘ for energy efficient homes. Officials in New Brunswick created an agency for energy efficiency in 2005, but admitted that theirs was patterned on one created previously in

Vermont (Sierra Club of Canada, 2005). In 2003, British Columbia began replacing traffic lights with LEDs—a policy widespread in the United States. The Yukon and

Nova Scotia conducted GHG inventories with the help of the federal government, while several provinces set up public-private partnerships or educational outreach centers, including the Yukon, British Columbia and Newfoundland/Labrador. Indeed, the provinces frequently worked with or simply emulated federal action. The federal government by 1999 had adopted efficiency standards for federal buildings and established an office of energy efficiency--later copied in 2004 by Saskatchewan.

Even Saskatchewan‘s 2000 effort to retrofit an inefficient coal plan for natural gas emulated policy decisions in the United Kingdom. Clearly, experimenting with new policies was not the top priority in much of Canada prior to 2006.

There are two reasons why policies in pre-2006 lack extensive levels of innovation. As discussed in chapter 2, climate policy in top-down states focuses on the

Kyoto Protocol and its implementation. Supporters of the Kyoto Protocol follow the national lead, adopting greenhouse gas targets and supporting policies such as creating advisories and commissions, GHG inventories, and energy efficiency standards. In some cases, their support of Kyoto gave them a free pass from environmental organizations on climate change, allowing them to reap accolades without engaging in further policy action. The opposition, on the other hand, is too busy fighting against federal intrusion in 195

what they deem to be part of the provincial jurisdiction to focus on innovative policy creation on the issue, lest it be viewed as capitulating on the issue.

Several provinces indicated their support of the Kyoto Protocol during the ratification debates, including Newfoundland and Labrador, Nova Scotia, Quebec, and

Manitoba. These provinces were frequently given a free pass by environmental organizations simply for supporting the Kyoto Protocol, regardless of their other efforts.

For example, the Rio Report Card of the Sierra Club improved the 2003 grade of these provinces simply because of their indicated support for the Kyoto Protocol: ―Premier

Doer‘s stalwart defense of the Kyoto Protocol, often when it was hard to know if the federal government deserved the support, raises Manitoba‘s grade this year (from a B- to a B+)‖ It receives this grade despite the fact that, as the document reports, ‗the reality of how Manitoba plans to meet its Kyoto targets is a source of real concern.‖ Similarly, the

Northwest Territories received praise for its 2004 energy strategy, which only stated that it was ―committed to: continuing to take action on GHG emissions in support of Canada‘s international commitments on climate change.‖ No concrete measures outlining exactly what kinds of ―action‖ would be taken, however. Meanwhile, ‗F‘s were awarded to

Ontario, Alberta, and British Colombia—the three provinces that fought hardest against

Kyoto ratification. No other province received an F in 2003, even though many of them lacked GHG inventories or climate action plans—two things Alberta had completed years before. Saskatchewan, for example, which had no climate action plan and in 2006 would be called the ‗worst‘ provincial performer by the David Suzuki Foundation, received a C from the Sierra Club in 2003. The rationale: ―Saskatchewan‘s performance in the Kyoto debate was mixed, but overall the province deserves credit for staying the course for 196

ratification.‖ With high marks by the Sierra Club for Kyoto-supporting provinces to tout, there was little incentive for these provinces to focus their resources on developing new and innovative policies. By those watching most closely, they had already received passing grades.

The second reason why provincial policymaking shows lower rates of innovation is worries about competition with other provinces and states. In the absence of mandatory federal policy, many provinces were concerned about what share of the reduction burden they would be called upon to bear. Successful experimentation with climate policies could result in being asked to bear a greater share of the eventual reductions. Essentially a race to the bottom develops between the provinces as they worry about losing wealth to their peers and competitors. Each province hoped to free-ride on the efforts of its peers so it could bear as little of the burden as possible.

This race to the bottom mentality was evidence in the provinces. Even Quebec, which was frequently cited as the most progressive province on climate change, was subject to this mentality: policymakers spent enormous time and effort to secure a promise from the federal government that they would not be punished for early action on developing renewable energy.51 Having secured the promise, Quebec policymakers essentially pointed fingers at the other provinces, claiming they had done their part and it was time that Ontario and Alberta did theirs. Ontario officials for their part often tried to reflect blame to Alberta.

Alberta itself was certainly subject to this race to the bottom behavior.

Policymakers were very concerned with the impact of the Kyoto Protocol on Alberta‘s

51 The David Suzuki Foundation named Quebec the ‗best‘ of the provinces in its 2006 report. 197

competitiveness both in Canada and abroad. As the highest emitter in Canada, Alberta would be expected to bear the brunt of the 6% reduction target, leading to increased costs for its companies and decreased competitiveness elsewhere in Canada and abroad. One official noted that Canada‘s involvement in NAFTA could seriously hurt it.

Mexico does not have any stated emissions reduction commitments. In addition,

Mexico also offers reduced labour costs than do Canada and the United States.

With no emissions targets, Mexico will be able to continue in high-polluting

industries with no economic sanctions being placed on businesses operating in

that country. Meanwhile, companies operating in regions that do ratify the Kyoto

Protocol will be forced to purchase emissions permits which increase the cost of

production….Firms operating in manufacturing industries will likely examine

relocation to Mexico in order to access a less expensive labour force while

avoiding the additional cost of emissions permits. (Saskatoon and District

Chamber of Commerce)

Alberta was concerned not only about its international competitiveness, but also about the potential to transfer wealth out of the province. Several officials noted their concern that if the federal government forced emission reductions on Alberta, it would essentially amount to economic gains for those less-regulated provinces as government revenue was shifted away from development projects and into cutting emissions. This was one of the main reasons for all of the stalling activity we saw in Alberta in chapter 3: by insisting on a ―made in Alberta‖ approach but not actually requiring any reductions, Alberta could claim it was acting without actually creating strong and innovative climate legislation. 198

The top-down model as we have seen tends to result in policies that are more direct, aimed at short-term returns, and lacking high levels of innovation. In the next section we turn our attention to the bottom-up model.

The Bottom Up Model

In the bottom-up model represented by the United States and post-2006 Canada, we expect to find policies that are indirect, have longer time horizons for implementation, and are more innovative than their top-down peers. The evidence from the cases bears out these expectations.

Indirect Policies: In bottom-up models, we expect to see a greater level of indirect policies in addition to direct policies. These indirect efforts, which include market measures that put a price on carbon and renewable portfolio standards, allow policymakers to engage in policymaking on climate change without explicitly mentioning climate change, as their impact on emissions is indirect and often secondary. While we still find direct measures such as emission targets and caps in the United States, we have a much wider range of indirect policies than seen in top-down environments like Canada.

Indirect policies such as renewable portfolio standards are very popular in the

United States and post-2006 Canada, as twenty nine states plus the District of Columbia as well as five provinces have adopted an RPS. This compares to twenty states that have adopted greenhouse gas targets. In addition, two provinces have created carbon taxes52;

52 In April of 2009, the National Roundtable on the Environment and the Economy recommended that the federal government follow British Columbia and Quebec‘s lead and establish a national price for carbon. 199

thirty nine states and seven provinces have adopted incentives promoting the use of biofuels; thirty-eight states have adopted residential building energy codes, and forty-five states have established net metering and green pricing programs. All of these initiatives have impacts on climate change but do not by themselves lead directly to emission reductions. It is also notable that many of the states that have adopted an RPS are not those that we would necessarily expect to be climate leaders. North Dakota, South

Dakota, Utah, Kansas--these are conservative states, many of whom lack climate action plans, targets, GHG inventories or registries and indeed have never seen climate change appear on local policy agendas.

One reason why indirect policies proved more popular in the bottom-up United

States is that they allow policymakers to tailor policies to a variety of pressing public problems without taking on the controversial subject of global warming. In California, the ability to avoid the subject of climate change while discussing important climate change policies was crucial. As one former state assemblyperson said about the debate over the Pavley Bill, ―the words ‗climate change‘ were a non-starter with the

Republicans. We could talk about emission standards and air pollution, but one mention of climate change and the conversation would be over.‖ A high-ranking staffer for a state senator commented,

For some Republicans—coastal erosion, increased flood risk—they are all over

that. But if you put these issues more broadly as climate change…well, you don‘t

want that conversation. …‖You need to know the local dialect. Not using the

words ‗climate change‘ in some circles will work. In really conservative circles,

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climate change connotes Al Gore and liberal lefty groups. It‘s not productive to

talk to those words.

Such climate skeptics could be brought on board by avoiding the language of climate change and focusing on the benefits the policy brought to other issues. One skeptic commentator, after establishing her belief that ―there is reason to question‖ the anthropogenic causes of climate change, announces her support for AB 1493, but not because of its impact on global warming: ―Better gas mileage should reduce unhealthy air pollution, and reduce US reliance on foreign oil‖ (Saunders, 2002). Avoiding direct discussions of climate change allowed an important flexibility in policymaking in the US states, allowing decision makers to craft policies that would have an impact on a controversial issue while also addressing more conventional policy problems.

AB-32 itself reflects this concern with multiple policy problems and their connection to climate change. For example, language is included emphasizing the economic benefits of action in California: ―By exercising a global leadership role,

California will also position its economy, technology centers, financial institutions, and businesses to benefit from national and international efforts to reduce emissions of greenhouse gases‖ (California Statutes of 2006, ch. 488). Other areas of concern such as public health are explicitly mentioned as well: Section 38561(d) claims that ‗the state board shall evaluate the total potential costs and total potential economic and noneconomic benefits of the plan for reducing greenhouse gases to California‘s economy, environment, and public health.‖ Furthermore, the strong focus on market measures in the bill—part 5 is entirely devoted to the subject-- is a clear attempt to build stakeholder 201

support among conservatives and businesses. Certainly, entrepreneurs and investors were lobbying the statehouse to pass legislation on climate change that would promote investment in clean technologies, an area they had targeted for tremendous investment opportunities, according to a key Senate committee staffer (personal communication,

January 15, 2008).

The ability to avoid the words climate change was also crucial in policymaking circles outside of California. For example, in Texas, ―officials intentionally chose not to label their RPS as an initiative to reduce GHG emissions, even though all parties recognized that aspect of the proposal‖ (Rabe, 2004) This allowed them to focus on the economic potential of wind energy in Texas, while avoiding the controversial subject of climate change. In other states, bringing up climate change policies can be political suicide. In a state such as Ohio, officials who sought explicitly labeled climate policies feared losing their jobs (Ohio EPA official). Georgia officials who created innovative mass transit policies ―fell off their chairs‖ when someone mentioned the possible emission reductions produced by their programs (Rabe, 2004). Indeed, as Rabe (2004) discusses, the ability to avoid labeling policies as climate change led to substantial policy innovations in unexpected regions of the country.

Policies in the United States and post-2006 Canada, therefore, tended to take an indirect approach to climate change in order to create policies that address multiple issues at once. In this way, policymakers could build broader coalitions of support behind legislation that ultimately led to emission reductions, even if the policy was not explicitly labeled like AB-32, as the ―Global Warming Solutions Act.‖

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Longer Time Horizons: Another feature of the bottom-up system is that policies frequently have longer time horizons than their top-down counterparts. Freed from the deadlines imposed by the Kyoto Protocol, politicians can choose implementation dates that are far from the present, reaping the political benefits of announcing policies now but postponing the costs to a later administration. Policies that take a long time to implement—such as building new power plants or nuclear facilities, or investing in renewable energy—are therefore more common in the US than in pre-2006 Canada.

While targets in Canada tended to set 2010 or 2012 as their deadlines, US targets largely used 2050 or a generic ‗long term‘ as their deadline. As Table 4.2 shows, all but seven of the US states that adopted targets used such a long time line. The other seven still took a longer time horizon than Canadian policies, using 2020 or 2025 as their goal year. The provinces began moving toward this longer-term approach after 2006: three provinces—Ontario, Alberta, and British Columbia-- adopted 2050 targets in 2007-2008.

Saskatchewan acted earlier than its peers, adopting a 2050 target in 2005. In general, action plans in the provinces began shifting from an approach on how to meet Canada‘s

Kyoto target by 2012 and more on how individual provinces would address climate change in the long term.

Innovative Policies: A third feature distinct of the bottom-up model is the greater level of experimentation and innovation as compared to top-down systems. Unbound by the

Kyoto Protocol, sub-national governments are free to respond to climate change as determined by local needs and resources—which sometimes includes passing policies that never mention climate change, but implement emission reductions via ―stealth‖ 203

measures (Rabe, 2004). States are free to experiment with policies and identify best practices, and then to claim a leadership mantle they can use to pressure other states and the federal government into acting accordingly. In other words, they have the option to try and persuade their peers and the federal government to use as a policymaking model a policy that was designed to meet its own particular characteristics. This opportunity is not available to states in a top-down environment where the federal government is dictating policy options and desired results.

A number of the most innovative climate policy options available originated in the United States. Renewable Portfolio Standards, for example, originated in Iowa in

1983 and were developed by many other states. California‘s auto emission standards spread quickly to fifteen other states and five provinces, while the US brand of regional initiatives has led to aggressive commitments to targets and the development of the carbon cap-and-trade system (also originally developed in the United States). In post-

2006 Canada we have found commitments to carbon taxes, a BC goal of making the public sector entirely carbon neutral by 2010, and new programs in carbon capture and storage. This explosion in new and tweaked policies has largely occurred since 2002 in the United States and 2006 in Canada.

In chapter two we discussed two reasons why bottom-up systems would likely to have higher rates of policy experimentation and innovation. First, the vacuum in policy from higher levels of government leaves an opportunity for sub-national governments to race to the top in order to claim a leadership mantle and influence policymaking in peer states and the federal government. Second, meeting an international commitment becomes only one of several justifications for acting on climate change. Policymakers 204

are free to experiment with policies that address multiple issues. Problems of energy independence, public health, economic development, and even national security can be tied to climate change and used as motivation for acting. Decision makers can claim local ownership of the problem in a way that those governments bound to act by the

Kyoto Protocol cannot. As we shall see, the higher levels of bottom-up experimentation occur due to both of these rationales.

In chapter four we discussed how Californian officials saw an opportunity to step into the role of Crusader when the federal government abandoned its leadership role in climate change. The desire to influence policy was more widespread than just California, however. States and provinces alike worried that eventual federal policies would be privilege certain sub-national governments and not others, and few thought that they would be the privileged ones. Once Kyoto was off the table, federal policy was uncertain, and created a decided interest for policymakers to adopt policies that met their local needs, thus having beneficial policies grandfathered in and being able to claim the role of ‗early actor‘. As one official at Alberta Environment said, ―The plan right now is to not let the perfect be the enemy of the good. We need to experiment now, and adapt later‖ (Alb. Environment official 2). The movement from racing to the bottom to a race to the top was extremely evident in Alberta. The province before 2006 was determined to take as little action as possible, focusing on minimal and voluntary efforts. The fear was that any reductions would lead to a net transfer of wealth from Alberta to other provinces and states. But the threat of oil boycotts by US mayors and the loss of consumers interested in green products created a shift. Alberta by 2007 was determined to at least have the appearance of high environmental standards to ensure that its products are 205

bought in markets dominated by Green concerns. As one MLA put it, ―If we don‘t do this quickly, we‘re going to miss out...and the rest of the world are going to jump on it‖

(Alberta Hansard, March 19, 2007, pg. 213).

Policy innovation is not generated simply by a desire to claim a leadership mantle and influence policy directions by peers and the federal government. It also results from taking a comprehensive view of climate change as not simply an environmental issue but one that impacts energy, security, and economic concerns. Just as skeptics could be convinced to support a climate change policy so long as it was not explicitly labeled as climate change, they could also be brought on board if you focused on the non- environmental impacts of global warming. Officials in California, for example, revealed that a discussion of the same policies with climate skeptics would have radically different results depending on the nature of the conversation: if the discussion focused on the plight of the polar bears, for example, skeptics had no interest in discussing policies. But as one person involved in the debate noted, if the discussion focused on energy independence, increased efficiency, and the economic opportunities afforded by investment in renewable energies, the skeptics were more amenable (Interview with

Assemblyperson). This led to the development of new policies –such as auto emission regulation or an RPS—which addressed several policy problems at once, even if they did not lead to Kyoto-specified policy reductions.

The non-environmental issues most commonly associated with climate change were national security, economic development, and public health. Several policymakers have declared that they see climate change as a threat to national security. The

President‘s 2006 National Security Strategy alluded to this, claiming that, 206

Environmental destruction, whether caused by human behavior or cataclysmic

mega-disasters such as floods, hurricanes, earthquakes or tsunamis. Problems of

this scope may overwhelm the capacity of local authorities to respond, and may

even overtax national militaries, requiring a larger international response. These

challenges are not traditional national security concerns, such as the conflict of

arms or ideologies. But if left addressed they can threaten national security.

(National Security Council, 2006)

US Senators Dick Durbin and Chuck Hagel extend this argument to climate change, introducing bipartisan legislation in March 2007 that would ‗require a National

Intelligence Estimate to assess the security challenges presented by the world‘s changing climate.‖ In a press release, Durbin said, ―for years, too many of us have viewed global warming as simply an environmental or economic issue. We now need to consider it as a security concern.‖ (Durbin & Hagel, 2007). A 2004 report from the Pentagon supported these assertions, arguing that climate change had the potential to inflict substantial damage to the United States (Townsend & Harris).

Economic development opportunities have also been cited as being connected to climate change. Illinois and Nebraska are two states that adopted ‗climate‘ policies largely because of the potential economic opportunities (Rabe, 2004). California carefully marketed AB-32 as having economic benefits—proponents argued ―there is an economic advantage to being ahead of the curve in stimulating technologies that will only increase in demand in the decades ahead‖ (―Yes, it is,‖ 2006)—and policymakers privately admitted that making such claims helped secure votes in the legislature 207

(personal communications with key Calif. senate committee staffer, January 15, 2008; high-ranking staffer for Calif. state senator, January 24, 2008; former Calif. assemblyperson, January 25, 2008). In Alberta, no mention of economic benefits of addressing climate change were made in either the 2002 Action Plan or in legislative debate. By 2007, however, the government had shifted its stance, no longer speaking of the economic costs of acting, but focusing on both the costs of NOT acting and the benefits from taking decisive measures (Alberta Hansard, March 19, 2007, pg. 213).

Finally, public health has become a key component of climate policymaking. A

2008 Environmental Defense report shows that 60% of public health officials around the

United States believed that one or more serious public health problems will occur in their jurisdiction in the next two decades as a result of climate change and slightly over half of the directors felt preventing or preparing for climate change was an ‗important priority‘

(Balbus et al., 2008). Public health concerns were one of the primary motivators for

Ontario‘s policy on shutting down coal-fired plants. Several officials noted that pressure from the medical community on the government regarding air pollution led the government to commit to an earlier deadline to shut down the coal plants. Arguments about meeting Canada‘s Kyoto commitments led to little action in Ontario, but public protests about health issues led to innovative measures on climate change by the provincial government.

As we have seen, the bottom-up model generates policies that are more likely to be indirect, longer-term, and innovative as compared to their top-down counterparts.

This is not the only means by which we can compare our two cases, however. As we shall see in the next section, the success of the bottom-up model is matched overall by the 208

achievements in climate policymaking of sub-national governments in comparison to national governments.

Feds and States: Comparing Federal vs. Sub-National Policymaking

The preceding discussion of the characteristics of top-down and bottom-up policies serves as an initial basis for comparison of policymaking in the United States and

Canada. Clearly, the policymaking environment in the United States was more flexible than pre-2006 Canada, allowing for greater levels of policy innovation. However, once the federal Canadian government announced that it would abandon its efforts to meet its

Kyoto commitments, innovative activity flourished at the sub-national level in Canada as well. And yet in both countries, the federal governments have acted as true laggards, providing a national policy filled with little more than voluntary measures and incentive programs.

In this section we will compare the policies and emission reduction achievements at the federal and sub-national levels in the United States and Canada. As the discussion will make clear, the federal governments lag behind their sub-national counterparts in terms of both policies and emissions. Sub-national governments display higher levels of policy innovation and leadership and prove a breeding ground for eventual federal policy.

In both cases, however, this experimentation and innovation occurs only after the federal government has indicated it will not attempt to meet its Kyoto commitments. The flexibility provided to the sub-national governments by withdrawing from the Kyoto process allowed them to experiment with policies and rapidly diffuse best practices to their peers and even the federal government. 209

The weak federal policies found in the United States and Canada lag behind the more substantial efforts of several states and provinces. Neither country is on track to meet either their original commitments under the UNFCCC (to reduce emissions to 1990 levels by 2000) or the targets outlined in Annex B of the Kyoto Protocol (to reduce emissions to 6% (Canada) or 7% (the United States) below 1990 levels). Indeed, emissions by every measurement have increased dramatically between 1990 and 2007.53

Federal policies on climate change in both countries are decidedly weak. In the

United States, they consist of voluntary greenhouse gas intensity targets, incentive programs, and public-private partnerships. President George W. Bush established a voluntary intensity-based target for the United States in 2002 of 18% below business-as- usual levels by 2012. As discussed in chapter 3, intensity targets specify emission reductions relative to economic output, usually measured as gross domestic product. This is in contrast to absolute targets which specify a specific amount of reductions, usually relative to a historical baseline. Numerous experts deplore intensity targets as an insufficient policy measure, but even in terms of intensity targets this was a weak move on the part of the United States.54 The government had already projected that with no additional efforts the carbon intensity of the economy would decrease by 17% by 2012—

53 According to the official national greenhouse gas inventories prepared for both countries‘ National Communications to the Intergovernmental Panel on Climate Change, emissions have continued to increase over this period in both countries by more than 20%. 54 The Pew Center on Global Climate Change (2002) argues that ―The Administration‘s target…allows a substantial increase in net emissions.‖ The Pembina Institute concurs, with climate change director Matthew Bramley commenting on Canada‘s policy that ―The intensity-based targets…clearly put the government out of sync with the science of climate change, which shows very clearly we need to have actual reductions‖ (―Greenhouse gas,‖ 2007). Marshall (2007) predictably argues that intensity targets do not necessarily lead to real emission reductions. Kolstad (2005) argues that intensity targets are only viable if tied to rates of economic growth. 210

the 18% target, therefore, was hardly a bold move (Energy Information Administration,

2006).

Supplementing the greenhouse gas targets are a series of incentive programs and voluntary public-private partnerships. These include Energy Star, a labeling program for energy-efficient products; a voluntary greenhouse gas reporting program; the SmartWay

Transport Partnership, which promotes energy efficiency in the freight industry; and tax incentives for renewable energy, biomass energy, and crop and grazing land conservation actions. Public-private partnerships are also a preferred policy device by the U.S. federal government, which supports the Clean Energy-Environment State Partnership, Climate

Leaders, the Combined Heat and Power Partnership, the Green Power Partnership, and

Climate VISION.

Canada‘s federal policies also lack bite. As discussed in Chapter 3, Turning the

Corner, the federal government‘s 2007 climate change action plan, calls for a 20% absolute reduction below 2006 GHG emission levels by 2020. This amounts to a 2.5% decrease from 1990 levels—a far cry from the 6% target Canada agreed to reach by 2012 under Kyoto (Fickling, 2009). The proposed method of meeting this goal relies, like the

United States, on emission intensity. The plan proposes an 18% emissions intensity reduction for industry based on 2006 emission levels. Affected industries are allowed the same options found in Alberta: they can reduce their own emissions, buy credits from other firms, or pay into a technology fund at the rate of C$15/ton (ecoAction Canada,

2008). However, certain industries—notably the electrical and oil sands sectors-- are exempt from these regulations until 2018 at least, even though they are expected to be the largest contributors of Canadian greenhouse gas emissions over the next two decades. 211

Experts are skeptical that the government will be able to achieve its stated goals, and the provinces have largely ignored the federal plan while they attempt to set up cap-and-trade programs of their own (Bramley, 2008).

As the United States relies entirely on voluntary measures and Canada did little but produce unimplemented plans until Turning the Corner, it is not exactly surprising that neither country has achieved substantial emission reductions. Not only has neither state achieved the Kyoto targets they both abandoned, but they have also failed to achieve the voluntary targets outlined in the Framework Convention (that is, to reach 1990 levels by 2000). Indeed, the states have not managed to achieve any reductions: both states have experienced large increases in greenhouse gas emissions. As Figure 5.1 shows, overall emissions in both states have increased since 1990. From 1990 to 2007, emissions increased in the United States from 5077 million megatonnes CO2 equivalent to 6103

MMTCO2e in the US and from 592 to 747 in Canada. This represents a 20.2% increase in the United States and a 26.2% increase in Canada over this period.

Overall emission increases are not the only indication of policy failings in the two countries. Emissions have increased in almost every sector in both countries, as indicated in Figure 5.2. Furthermore, while the carbon intensity of the U.S. economy fell by 20% since 1990, the economy grew by 46%, leading to total carbon dioxide emissions increasing by more than 20%. Canada‘s carbon intensity fell by 17%, but the 65% growth in the economy also led to substantial emission increases.

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7000

6000

5000

4000

United States Canada

3000 Overall Emissions Overall

2000

1000

0 1990 1995 2000 2005 2007 Year

Source: Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2007 and Inventory of Canada‘s Greenhouse Gas Emissions 2007

Figure 5.1: Overall Emissions in the US and Canada, 1990-2007

2750

2500

2250

2000

1750

1500 US 1990 US 2006 Canada 1990 1250 Canada 2006

1000

750 Emissions, in Million Metric TonnesCO2 Metric Million in Emissions,

500

250

0 Commerical Industrial Residential Transportation Electric Power Sector

Source: 2006 Net System Power report, Energy Commission Publication # CEC-300-2007-007.

Figure 5.2: Emissions in California by Sector, 1990-2005

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Indeed, by several measures, Canada has performed worse overall than the United

States on combating climate change. While the United States has much higher overall emissions than Canada (producing 25% of the world‘s emissions compared to Canada‘s

2%), Canada has increased its emissions at a greater rate than its southern neighbor. As

Figure 5.3 indicates, Canada has matched or exceeded US emission growth over every five year period since 1990. From 1990 to 1995, Canada increased its emissions by

8.3%, compared to 6.5% in the United States. In the 1995-2000 period, Canada‘s emission increased by 12%; US emissions by 10%. Both states achieved approximately

2% increases from 2000-2005, but from 2005-2007, Canadian emissions increased another 2% while US emissions held almost steady, experiencing just a .2% increase.

Furthermore, Canada is more carbon intensive than the United States. In 2000, Canada produced 172 tons of carbon per $million GDP-PPP, while the produced 162 in that same year. The countries are also about equal in per capita emissions, with the United States ranking 2nd in the world with 6.6 tons carbon equivalent per capita and Canada placing a close third with its production of 6.3 tons (Baumert & Pershing 2004).

From this data we can conclude that neither federal government can claim bragging rights for its climate change record. Both states pursued weak, voluntary policies at the federal level, even as the federal government in Canada pressured its provinces to act aggressively. Furthermore, the data suggests that ratification of the

Kyoto Protocol cannot be relied upon as a sufficient indicator of a country‘s success in addressing climate change. Indeed, on certain measures—such as the rate of emission increases—Canada has performed worse overall than the United States from 1990-2005,

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despite its membership in the international climate regime. Canada‘s performance suggests that in that country at least, the top-down model did not produce better results than the bottom-up model found in the United States.

United States Canada

6 Percent Change Emissions in Percent 4

0 1990-1995 1995-2000 2000-2005 2005-2007 Years

Sources: U.S.Inventory of Greenhouse Gases; Canada Inventory of Greenhouse Gases.

Figure 5.3: Percent Change in Emissions in the US and Canada, 1990-2007

However, within these two countries there is clear evidence of policy innovation and leadership. Policies at the sub-national level are highly varied as states choose policies that adhere to local needs and resources. Furthermore, several states and provinces have managed to achieve real emission reductions since 1990. The experimentation and innovation that we find, however, occurred after both countries‘ federal governments announced that they would not attempt to fulfill their Kyoto commitments. This indicates that innovation flourishes in the environment of deregulation and flexibility provided by the absence of action by the federal government.

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Policies at the federal level stopped at greenhouse gas targets and voluntary initiatives, but sub-national governments experiment with a variety of different policies.

Carbon taxes, long ignored at the federal level, have been adopted by British Columbia,

Quebec, and Colorado Springs. Renewable Portfolio Standards are also widespread: they can be found in thirty-five U.S. states and four Canadian provinces. Fifteen states and five provinces committed to adopting California‘s auto emission standards. Carbon capture and storage research is heavily funded in two Canadian provinces, while clean coal technologies are gaining ground in the coal-heavy Midwest. Coal plant contracts have been severely restricted in California and entirely phased out in Ontario. Nine states have commissioned teams to plan for adapting to the effects of climate change. And thirty-nine states and seven provinces have created goals and incentives for the production of biofuels.

These policies are clearly more varied than their federal counterparts, and were adopted with local interests in mind. For example, Texas adopted an RPS emphasizing wind power in order to take advantage of the state‘s vast potential for wind energy. Ohio, which relies heavily on its coal industry, created an ―Alternative‖ Energy Portfolio

Standard, emphasizing research in ‗clean coal‘ technologies in an effort to be both green and avoid economic hardships. Ontario and California have significant concerns about the impact of air pollution on public health; their lack of reliance on coal made coal plant phase outs a popular option that was not available in Ohio. Finally, existing plans for adaptation to climate change are found entirely in coastal states that are likely to be the most vulnerable to rising sea levels.

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Numerous states and provinces have found success in either reducing their emissions or keeping the rate of increase at a low level.55 Tables 5.1 and 5.2 list emissions in each state and province from 1990 to 2005.

Table 5.1: Provincial Level Emissions, 1990-2006, in million metric tons CO2

Provinces 1990 2006 Absolute Change, Percent Change,

1990-2006 1990-2006

Newfoundland & Labrador 9.39 9.39 0 0

Prince Edward Island 1.93 2.05 0.1 5

Nova Scotia 19 19.6 0.6 3

New Brunswick 15.9 17.9 2 13

Quebec 82.7 81.7 -1 -1

Ontario 174 190 16 9

Manitoba 18.8 21.2 2.4 13

Saskatchewan 44 72 28 64

Alberta 172 234 63 37

British Columbia 48.9 62.3 13 27

Yukon 0.54 0.39 -0.1 -19

Northwest Territories & Nunevet 1.49 1.29 -0.2 -13

Source: Trends in GHG Sources and Sinks in Canada 1990-2004 Environment Canada; CO2 Emissions from Fossil Fuel Combustion (California Air Resources Board, 2009)

55 Many states and provinces did, of course, perform worse than the federal rate, since federal performance is an average of provincial performance. Indeed, it is difficult to judge the impact of sub-national policies on changes in emission levels, as data is limited after 2005 and many policies were either developed or implemented after that date. 217

Table 5.2: State Level Emissions 1990-2005, in million metric tons CO2

State 1990 2005 Absolute Percent

Change Change

1990-2005 1990-2005

Alabama 109.94 141.1 31.16 28

Alaska 34.18 47.12 12.94 38

Arizona 62.87 97.17 34.3 55

Arkansas 51.23 60.54 9.31 18

California 364.32 390.64 26.32 7

Colorado 66.71 94.34 27.63 41

Connecticut 40.98 43.3 2.32 6

Delaware 18.23 17.75 -0.48 -3

District of Columbia 4.46 3.94 -0.52 -1

Florida 188.16 260.74 72.58 39

Georgia 138.84 184 45.16 33

Hawaii 21.5 23.05 1.55 7

Idaho 11.36 15.83 4.47 39

Illinois 194.33 242.81 48.48 25

Indiana 205.29 231.59 26.3 13

Iowa 63.95 79.67 15.72 25

Kansas 69.58 72.46 2.88 41

Kentucky 118.9 152.15 33.25 28

Louisiana 191.76 191.56 -0.2 -0.1

Maine 19.1 22.93 3.83 20

Maryland 70.85 83.91 13.06 18

(continued)

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Table 5.2: continued

Massachusetts 83.92 84.83 0.91 1

Michigan 182.07 189.58 7.51 4

Minnesota 79.47 100.65 21.18 27

Mississippi 48.45 63.56 15.11 31

Missouri 103.6 141.11 37.51 36

Montana 28.24 36.27 8.03 28

Nebraska 33.14 43.1 9.96 30

Nevada 30.59 49.56 18.97 62

New Hampshire 14.68 21.21 6.53 44

New Jersey 115.37 134.54 19.17 17

New Mexico 52.57 58.98 6.41 12

New York 210.15 210.91 0.76 0.4

North Carolina 111.36 153.51 42.15 38

North Dakota 40.54 49.16 8.62 21

Ohio 246.45 269.97 23.52 10

Oklahoma 88.69 106.09 17.4 20

Oregon 31.07 42.67 11.6 37

Pennsylvania 265.36 277 11.64 4

Rhode Island 8.91 11.28 2.37 27

South Carolina 61.41 87.24 25.83 42

South Dakota 11.89 13.19 1.3 11

Tennessee 105.73 127.25 21.52 20

Texas 588.27 663.87 75.6 13

Utah 53.8 66.06 12.26 23

(continued)

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Table 5.2: continued

Vermont 5.46 6.79 1.33 24

Virginia 95.36 128.93 33.57 35

Washington 72.03 85.61 13.58 19

West Virginia 106.54 113.13 6.59 6

Wisconsin 86.14 110.53 24.39 28

Wyoming 57.76 62.87 5.11 9

Source: CO2 Emissions from Fossil Fuel Combustion

Many states and provinces have contained their emissions to well below the average rate in the United States and Canada. As shown in Figure 5.4, California‘s emissions increased by 9% from 1990-2005; overall U.S. emissions increased by 23% during this same period. Other states that performed better than the U.S. government include Texas, Michigan, Ohio, Pennsylvania, West Virginia, and Wyoming—all states with substantial oil, coal, and/or automobile interests. In fact, the five states with the highest greenhouse gas emissions in the United States experienced, on average, a 15% increase in emissions since 1990.56 In Canada, the top five emitting provinces experienced an 11 % increase in emissions, compared to 30% in the country as a whole.57

Several states and provinces have even managed to decrease their emissions from 1990 levels, including Delaware and the District of Columbia in the United States, and Quebec,

56 The top five emitters in the United States are Texas, California, Pennsylvania, Ohio and Florida. Of these, only Florida‘s rate of increase exceeds that of the federal government, at 39%. 57 The top five emitters in Canada are Alberta, Ontario, Quebec, Saskatchewan, and British Columbia. Of these, Alberta and Saskatchewan‘s rate of increase exceeds that of the federal government. Alberta registered a 37% increase and Saskatchewan a 64% increase, though its absolute increase was only 28 million metric tons CO2e. 220

the Yukon, Northwest Territories and Nunevet in Canada. Newfoundland and Labrador maintained their emission rate over this period, steadily producing 9.39 MMTCO2e.

California Total Emissions

600

500

400 California Total 300 Emissions 200

Milliontonnes CO2e 100

0 1990 1995 2000 2005 2020 Year

Sources: California Greenhouse Gas Inventory-2020 forecast, 2000-2006 Inventory

Figure 5.4. California CO2 emissions from

Fossil Fuel Combustion, trends and projections

Clearly, many states and provinces were performing better than their federal governments in both policy experimentation and emissions. But we can take this idea one step further, and argue that it was precisely because of the absence of federal policy that these sub-national governments were able to be so successful. Of the policies discussed above, the vast majority have been adopted since 2001 in the United States and

2006 in Canada, the years when the federal government essentially abandoned their commitments to the Kyoto Protocol. Table 5.3 starkly depicts the increase in U.S. policy activity after 2001. In fact, the policy most frequently adopted prior to 2001 was the

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RPS—a policy adopted not necessarily to address climate change but primarily for reasons of economic opportunity in Texas, Connecticut, Iowa, Maine, Massachusetts,

Minnesota, Nevada, and Wisconsin.

Table 5.3 Sub-national Policy Adoption in the United States

POLICY TYPE ADOPTED ADOPTED TOTAL NUMBER OF

BEFORE AFTER ADOPTIONS BY

3/27/2001 3/27/2001 JULY 2009

GHG Targets 0 21 21

RPS 8 27 35

California Auto 0 16 16

Standards

Caps/Offsets 0 5 5

Adaptation Plans 0 9 9

Taxes, Carbon Capture 0 3 3 and Storage, and Coal

Plant Limits

Total Adoptions 8 81 89

Source: Pew Center for Global Climate Change, states and regions climate policy maps.

Much of the innovative policymaking in Canada occurred after the 2006 warnings from the Canadian government that it would no longer attempt to meet its Kyoto

222

commitments. For example, Alberta‘s innovative policies of industrial regulation and carbon capture and storage were adopted in 2008. British Columbia adopted greenhouse gas targets, an RPS, carbon capture and storage, and a carbon tax in 2007 and 2008.

Ontario announced its intentions to adopt California‘s auto standards and phase out coal- fired plants in 2008, while the Saskatchewan Party promised to cut emissions by 32% in its campaign during the 2007 provincial elections. Quebec was the earliest actor, adopting its action plan in June 2006, which included greenhouse gas targets, public transit funds, a carbon tax, and an intention of adopting the California auto emission standards. Furthermore, in 2008, Quebec and Ontario agreed to set up a joint cap-and- trade network at some point in the future.

Clearly, sub-national activity flourished during the periods following federal withdrawal from the climate issue. Indeed, federal inactivity can be viewed as a permissive condition for sub-national experimentation. Some states and provinces choose to step into this vacuum and experiment with policies that work for their local needs and resources. Not every sub-national government will act simply because the federal government refuses, but it is clear that the most innovative policymaking occurred during periods when the federal government was least active in addressing climate change.

Clearly, these bottom-up environments allow for greater policymaking flexibility.

Earlier in this chapter we discussed the extent of the flexibility in bottom-up models, where policies can be direct or indirect, long term or short term, and framed as solutions to multiple policy problems. Innovation was stifled at the provincial level in Canada during the period of the federal government‘s commitment to Kyoto, when the 223

restrictions of the Protocol created incentives for short term, direct policies rather than experimentation with innovative policy options. Indeed, the focus at that time was not on pursuing best local practices for emission reductions, but on how to implement that particular agreement and its requirements. Innovation eventually did flourish in

Canada—but only following the 2006 ruling Conservative Party‘s announcement of abandoning their commitments to Kyoto. Indeed, two of the most innovative provinces—Alberta and British Columbia, both ―Climate Innovators‖—had been amongst the most strenuous obstructionists to the Kyoto Protocol. Alberta‘s experimentation with its innovative regulation scheme has certainly borne fruit, as it is the clear inspiration for the federal government‘s regulations outlined in Turning the

Corner.

In this chapter we have compared the characteristics of top-down and bottom-up models and discovered that policies in the latter are considerably more flexible than the former. Top-down policies tend to be direct and short term and feature a race to the bottom. Policies in bottom-up systems are a combination of direct and indirect policies, adopt long term goals but with early action measures, and frequently promote a race to the top. We then turned our attention to comparing policy making at the federal and sub- national levels in both countries, and determined that by every measure, sub-national governments are more innovative and more effective at addressing climate change.

Indeed, current federal policies are clearly rooted in policies originally adopted in Alberta and California. Looking at the larger picture of policymaking in Canada and the United

States reveals that the flexibility offered by the bottom-up model produces policies

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designed to meet local needs and resources that can be emulated by other states and even the federal government.

In the final chapter I will summarize the arguments made in this and previous chapters and offer some brief conclusions about the significance of this research. In particular, I will note the theoretical and policy implications of my findings and suggest some avenues for future research on the issues discussed.

225

Chapter Six: The Future of Sub-National Climate Change Policymaking

In the previous five chapters I have presented and defended a Framework for Sub-

National Climate Change Policymaking and a corresponding typology of policy choice.

In this final chapter, I will summarize the findings of this research and then revisit the claims made in Chapter One. First, I will examine the theoretical implications of this project, noting the contributions that I make toward the puzzles and gaps in the literature identified in the first chapter. Then I note the implications for policymakers interested in finding solutions to global warming. I end the chapter and the dissertation by noting some remaining issues and how I plan to address them in the future.

Summary of Findings

In Chapter Two, I identified several potential findings that I expected to find evidence for in the course of this project. Overall, the case studies show qualified support for these expectations which are outlined below.

First, I expected to find notable differences in the policy-making process in top- down and bottom-up systems. The case studies of the United States and Canada provide fairly clear evidence in support of this proposition. In Canada, the national government plays a much more overt role in influencing the policy process in the provinces than does the federal government in the United States. However, windows of opportunity and

226

policy champions clearly influence policy in the United States but not to any great extent in Canada. In many ways they take the place of the national government by bringing climate change onto the public agenda and guiding the process toward policy adoption.

Moreover, we find greater flexibility in policy choice in bottom-up systems than in top- down environments.

A second expected finding lies in the policy outcomes in the two systems. I expected to find policies that were more direct, short-term focused, and less innovative in top-down systems. Bottom-up systems should feature policies that are more indirect, long-term, and highly innovative. Overall this is the case but the correlation is of course not perfect. Bottom-up governments adopt direct policies as well as indirect and occasionally includ early-action measures in addition to their long-term goals. The main difference lies in the absence of long-term, indirect policies in top-down systems, but there are a few exceptions to that rule as well.

Thirdly, I find evidence that the priority of climate change and the cost of transitioning from a fossil-fuel economy are important factors influencing policy choice.

The Typology of Sub-National Climate Policy Choice stands up under scrutiny as a useful way of organizing policy decisions. By looking at two cases over time, I am able to track the impact of changing public opinion on policy making. I am not, however, able to provide clear evidence that changing cost structures also impact the same state or province over time. As these structures change less easily and frequently than public opinion, the twenty-year time frame I use limits our ability to see this process. Hopefully further study of additional cases will reveal that policy responds to these changes as well as the ones analyzed in the current version of this research. 227

One final finding I anticipated is that the bottom-up system is a viable path for solving climate change. I believe that my research bears out this conclusion. The case of the United States (and particularly California) demonstrates that bottom-up environments can produce successful, aggressive, innovative climate policies. The top-down approach is clearly not the only way, or perhaps even the best way, to address concerns about global warming.

Theoretical Implications

My research indicates that the bottom-up approach can be a successful path to respond to the challenges of climate change. In Chapter One, I identified several challenges that climate change poses to policymakers. Many of these can be mitigated through a bottom up approach. For example, I argued that climate change offers short-term, visible costs in exchange for long-term, invisible benefits. The bottom-up approach makes it easier for policymakers to postpone the costs of climate change by taking a longer-term approach to emission reductions. They can also tie climate change to economic and security concerns as well as issues only tangibly connected to climate change. This mitigates several of the challenges of climate change, first by reducing the impact of climate skepticism, but also by creating benefits that are short-term and more concentrated. The benefits of addressing climate change, therefore, do not have to be long-term or diffuse when the bottom-up approach is used. It is still true that the burden of emission reductions is largely on those countries that are least vulnerable to the impacts of climate change; however, certain regions in developed countries are quite vulnerable to global warming, notably coastal and low-lying regions. These regions and their governments therefore 228

have a strong incentive to address climate change when they have the flexibility to do so in ways that take their local conditions into account. A bottom-up system offers this flexibility.

Finally, even the issue of the right to develop can be aided by using the bottom up approach. During a July 2009 visit by U.S. Secretary of State Hillary Clinton to India, the Prime Minister that India would not consider binding emission targets out of fears for its economic development. This was widely considered a blow to international efforts to solve climate change. Binding emission targets are the preferred policy of the international regime, but are clearly not the only way to successfully engage in climate policy. A move away from top-down regulation would only help India—giving them incentives and support to experiment with other policies that achieve the two goals of economic development and mitigating climate change, without censure from the rest of the world for following this path.

My findings also give us traction on the three puzzles and gaps in the literature addressed in Chapter One of this dissertation. In the areas of governments and markets, the tragedy of the commons, collective action, sub-national climate policymaking, policy diffusion, and international regimes, my work makes some interesting contributions.

I argued in Chapter One that our understanding of governments and markets leads us to expect that the highest levels of governments will provide public goods. I noted that in spite of this, we find substantial sub-national action on climate change in countries like the United States.

My work confirms this understanding. Sub-national governments are not trying to provide a public good on their own. They are acting on climate change not to ‗do their 229

part‘ to solve a global problem but to address their local interests and conditions.

Politicians are responding to public opinion and interest group pressure and their own desire to stay in office, not out of a belief that they can provide this public good on their own. Indeed, many officials claim that a stated goal of their local effort is to get the national government to provide policy direction. Sub-national governments, through their actions, are trying to create incentives for the national government to provide the public good—they are not trying to provide it on their own.

A second puzzle I identified earlier is that governments are supposedly limiting their use of the global atmospheric commons without the action of a Leviathon. While some governments are indeed voluntarily reducing their emissions, there is still quite a bit of free riding occurring, as many states in the United States are doing nothing to reduce their emissions. But the idea of the commons indicates that economic benefits come from individual overuse of the commons. Many policymakers have instead discovered that there are individualized economic benefits from limiting their use of the commons— in this case, by being the forerunners in creating a new, renewable commons that cannot be depleted (by becoming leading producers of renewable energy).

The third puzzle was that we expect in the absence of action by a higher level of authority, actors will not work collectively to provide a public good such as climate change, yet states are appearing to do just that. My work does not offer a substantial explanation for this behavior beyond confirming that it is the case. Some policies can be explained by their focus on multiple issues rather than climate change, and therefore are not actually attempts to provide public goods. But many states have joined together to create regional initiatives on climate change with stated emission reduction goals. These 230

are clearly attempts to build an emissions reduction regime from the ground up, and is rather surprising. This is an area that is ripe for future research.

My work also helps us fill in some gaps in the existing literature. First, it makes contributions to the growing literature in sub-national climate policymaking. Barry Rabe created a typology of policy action in his book Statehouse and Greenhouse. He uses two factors to explain these decisions. First, the issue can be framed differently by policymakers as one creating environmental costs, economic costs, or economic benefits.

Second, the solution may be either explicitly or implicitly labeled as a ‗climate‘ policy.

This results in six types of strategies for states: Prime-time strategies; Opportunistic strategies; Hostile strategies; Stealth-Prime time strategies; Stealth strategies; and

Indifferent Strategies.

My research furthers Rabe‘s work in two ways. First, my work helps explain why policymakers choose a particular policy approach. I focus less on strategies and more on identifying the conditions under which policymakers will choose a particular type of policy. Thus I hope my work sheds light on why a particular state might choose to frame the issue of climate change or label their policy response in a particular way. Second,

Rabe‘s work focuses on the United States and is therefore operating exclusively in a bottom-up environment. My addition of the Sub-national Climate Policy Framework therefore acts as an overlay to his work, helping us understand the differing policymaking environments in top-down and bottom-up systems. The ability to use particular strategies for framing and labeling differ in these two systems. For example, Rabe argues that policy champions play a crucial role in generating policy at the sub-national level. My work suggests that policy champions have less flexibility in top-down systems and are 231

therefore more likely to have an impact in the United States than in a country like

Canada.

My research also adds to a growing literature in American politics that suggests that policies diffuse not only horizontally between states but also vertically between different levels of government. Evidence from the United States and Canada suggests that sub-national governments do lobby for particular policies to be adopted by their federal counterparts and have been successful in their efforts as illustrated by the Obama

Administration‘s announcement that it will adopt the much-litigated California auto emission standards.

Finally, research suggests that international regimes offer ways to counter the consequences of anarchy and the prisoner‘s dilemma. This leads national governments to seek international regimes when confronted with new global problems. My research does not contradict this finding. Top-down approaches can jump-start policy responses and keep a particular issue on the political agenda. Indeed, most policymakers in sub- national governments acknowledge that the existence of the Framework Convention and

Kyoto Protocol played pivotal roles in generating sub-national action on climate change.

My research therefore does not suggest that international regimes are worthless.

However, the design of the international regime matters. When the regime imposes a particular policy on its members, the resulting top-down system can create perverse incentives that do not result in the desired outcomes. My research suggests that for some types of global problems, notably climate change, a bottom-up approach may be a better solution. Indeed, there are four particular characteristics of climate change that make it particularly well-suited to a bottom up approach. 232

First, it is an international issue that reaches deeply into domestic politics. Policies affecting natural resources, transportation, utilities, landfills, and land use impact governments from the national level all the way to the municipal level. Local interests and abilities therefore must be taken into account for policymaking to be successful. This stands in stark contrast to issues such as arms control, which has few implications for sub-national governments.

Second, climate change is a multi-faceted and –dimensional issue with a very wide scope. This allows politicians to link it to other crucial policy issues, creating incentives for innovation that do not exist when policy is imposed from the top-down.

Finally, climate change is a relatively new issue prone with misinformation, skepticism, and a lack of consensus. At first, many policymakers doubted the existence of the problem and its potential causes, but even now there is no consensus on the distributive impacts of climate change and the best policies to solve the problem. This creates incentives for experimentation from the bottom-up. When a consensus exists on the necessary solution, however, a top-down approach may be the best system, as it was with addressing the hole in the ozone layer.

Clearly, there are many international problems that do not feature these characteristics. This helps explain why numerous global problems—from arms control to containing small pox—have been mitigated successfully through international regimes.

But for problems that do bear a similarity to climate change, policymakers would find it in their interest to consider a bottom-up approach.

233

Policy Implications of the Research

Clearly this research makes several important contributions to our understanding of international regimes and how they are used to solve global problems. But I believe my work also has a few implications for future policymaking on climate change.

First, sub-national efforts should not be dismissed as either ineffective or unimportant. Currently, most scholars and practitioners assume that top-down guidance is needed to handle climate change and that any other efforts are secondary. Indeed, even officials in California downplay their efforts, arguing that national policy is definitely needed (Interviews with ARB officials 1 & 2). My work suggests that quite to the contrary, successful policymaking can originate at the sub-national level. This allows for policy experimentation based on local conditions and resources that can serve as a basis for future policymaking decisions.

This also means that it may be time for policymakers to stop equating a country‘s success in addressing climate change with its ratification or support of the Kyoto

Protocol. A government that announces its reluctance to adopt binding emission targets is usually labeled a climate pariah, but my research demonstrates that Kyoto ratification does not necessarily correlate with effective policymaking on climate change. By dismissing the efforts of countries such as the United States, policymakers have ignored the contributions being made by U.S. states and are losing out on a substantial source of policy innovation.

Second, as policymakers consider the structure of a post-Kyoto regime, they should consider practicing the mantra, ―think global, act local‖. Local-initiated policy efforts can produce innovative policies that contain aggressive and effective measures on 234

climate change. International regimes do still play an important role in the process—they act as a clearinghouse for information about successful and unsuccessful efforts, facilitate the diffusion of best practices, and create a consensual knowledge base—but they should focus on creating incentives for bottom-up policymaking rather than simply imposing a one-size-fits-all top-down solution.

Directions for Future Research

My findings and conclusions suggest several areas to direct future research efforts. First, cynics may note that ultimately there is no difference in the overall outcome in emission reductions in the United States and Canada. Both states have substantially increased their emissions since 1990, leaving room to question the value in finding differences between top-down and bottom-up policymaking. If the end results are the same, one could argue, what does the process matter?

Naturally, I believe the process matters quite a bit. Identifying the incentives behind decision processes helps us craft better policies in the future. But I also believe that the results of policy are not quite clear. Sub-national governments in these two states have had less than five years to implement their policies, many of which take a longer time horizon before results should be seen. It is therefore premature to judge policy outcomes based solely on emission levels. Both countries are laying the groundwork for future reductions, and I must therefore reserve judgment on this score for future research.

A second possibility is to expand the case set: the European Union, for example, may provide us with enough variation to further examine the impacts of the top-down structure on policy outcomes. 235

A second caveat of this project is that we must note that the bottom-up system is not universally superior to the top-down model. There are a number of drawbacks to this process, most notably that some sub-national governments can choose to completely ignore the issue and not engage in experimentation and innovation. In this project, I argue that policy champions take advantage of windows of opportunity to put climate change on the political agenda in particular states. But I do not wrestle with the question of the conditions under which policy champions will arise in a particular state, and that is an area that is certainly underdeveloped and worthy of future study.

Finally, I am limited in the extent to which I can claim a generalizable validity of my results. Preliminary research in Ontario, Ohio, and elsewhere suggests that the

Typology is valid in other states and provinces but I cannot conclusively make any claims without more explicit testing. Therefore, I intend to use the results of this research to develop testable hypotheses and expand my analysis to further cases, notable Australia and the European Union.

For now, however, my hope is that this project sheds some light on the different approaches governments are taking to the crucial global issue of climate change. States should not assume that their usual methods of solving global problems apply in this particular case, and should be more open to locally-driven approaches that can result in much-needed policy innovation.

236

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Appendix A: List of Abbreviations

AB ...... Assembly Bill

ARB ...... California Air Resources Board

CALEPA ...... California Environment Protection Agency

CAT ...... Climate Action Team

CCCSTI ...... Committee on Climate Change Science and

Integration

CDM ...... Clean Development Mechanism

CFCs ...... chlorofluorocarbons

CO2 ...... carbon dioxide

COP ...... Conference of the Parties to the Framework

Convention

ED ...... Environmental Defense

EPA ...... Environmental Protection Agency

GDP ...... gross domestic product

GHG ...... greenhouse gas

IPCC ...... Intergovernmental Panel on Climate Change

KWh ...... kilowatt hour

MGGRA ...... Midwest Greenhouse Gas Reduction Accord

263

MLA ...... Member of the Legislative Assembly

MMTCO2e ...... Million Metric Tons Carbon

Dioxide Equivalent

MW ...... megawatt

NAFTA ...... North American Free Trade Agreement

NASA ...... National Aeronautics and

Space Administration

NEG/ECP ...... Conference of the New England Governors

and Eastern Canadian Premiers

PC ...... Policy Champion

PPIC ...... Public Policy Institute of California

RGGI...... Regional Greenhouse Gas Initiative

RPS ...... Renewable Energy Portfolio Standard

SB ...... Senate Bill

WCI ...... Western Climate Initiative

UN ...... United Nations

UNFCCC...... United Nations Framework Convention on

Climate Change

ZEV ...... Zero Emission Vehicle

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Appendix B: List of Interviews

Date Place Individual’s role Reference Form

1/15/2008 Sacramento, CA Key Senate committee staffer Senate comm. staffer 1/15/2008 Sacramento, CA California State Senator Calif. state senator 1/17/2008 Sacramento, CA High-ranking official at the Air ARB official 1 Resources Board 1/18/2008 Sacramento, CA Analyst at Legislative Analyst‘s Analyst Office 1/19/2008 Sacramento, CA High-ranking official at the Air ARB official 2 Resources Board 1/22/2008 Sacramento, CA Member of the Climate Action CAT member Team 1/23/2008 Sacramento, CA Official at the Air Resources ARB official 3 Board 1/23/2008 Sacramento, CA Official at the California Energy CEC official Commission 1/24/2008 Sacramento, CA High-ranking staffer for State Senate staffer Senator 1/24/2008 Sacramento, CA Official at California CALEPA official Environmental Protection Agency 1/24/2008 Sacramento, CA Key staffer for Climate Action CAT staffer Team member

265

Date Place Individual’s role Reference form

1/25/2008 By phone Official at Environmental ED official Defense 1/25/2008 By phone Former California state Assemblyperson assemblyperson 1.30/2008 Berkeley, CA Scholar at UC Berkeley Berkeley scholar 1/30/2008 Berkeley, CA Climate advisor for the Mayor Mayoral advisor 2/1/2008 Berkeley, CA High-ranking staffer for the Mayoral staffer Mayor 2/1/2008 Berkeley, CA Member of Kyoto Now Kyoto Now member 9/17/2008 Columbus, OH Ohio state senator Ohio state senator 9/17/2008 Columbus, OH Official at Ohio Environmental Ohio EPA official Protection Agency 11/18/2008 Washington, Official at the U.S. EPA EPA official DC 2/9/2009 Edmonton, AB Member of the Alberta Alberta MLA 1 Legislative Assembly 2/9/2009 Edmonton, AB Member of the Canadian Kyoto Kyoto delegate delegation 2/9/2009 Edmonton, AB Former high-ranking official at Alb. Environment Alberta Environment official 1 2/9/2009 Edmonton, AB High-ranking Member of the Alberta MLA 2 Alb. Legislative Assembly 2/9/2009 Edmonton, AB Scholar at the University of Alberta scholar Alberta 2/11/2009 Edmonton, AB Official at Alberta Energy Alb. Energy official 1

266

Date Place Individual’s role Reference form

2/11/2009 Edmonton, AB Official at Alberta Energy Alb. Energy official 2 2/11/2009 Edmonton, AB High-ranking official at Alberta Alb. Energy Energy official 3 2/12/2009 Edmonton, AB Official in the Climate Change Climate Change division at Alb. Environment official 1 2/13/2009 Edmonton, AB Official in the Climate Change Climate Change division at Alb. Environment official 2 2/13/2009 Edmonton, AB High-ranking official at Alberta Alb. Environment Environment official 2 2/13/2009 Edmonton, AB Scholar at the Pembina Institute Pembina scholar

267