May 15, 2006
Global Warming – Chicago Climate Exchange
The world is warmingThere is a consensus among the world's leading scientists that global warming pollution by humans is one of the world's most significant problems today. Experts at the University of Washington Climate Impacts Group have said that here in our backyard, snowfall and snowpack will be significantly reduced – leading to earlier snowmelts, less and warmer water in our rivers during the summer, and increased risk of flooding. These changes put agriculture, salmon fisheries, recreation and our very way of life in the Pacific Northwest at stake.
Carbon markets are coming
Many leading scientists and economic experts agree that an international carbon market is the most effective, efficient way to slow the emissions of greenhouse gases that lead to global warming. Current carbon market development worldwide represents an opportunity for expertise-building and financial investment in the array of alternative fuels and technologies that will underpin a future clean energy, climate-friendly economy. Banks, insurance companies and other financial institutions have increasingly begun to calculate the financial risks of carbon emissions under a range of possible future regulations, and recognize the need for federal regulation to ensure uniformity of carbon market rules for long-term business investments.
How King County has responded
King County's October 2005 Climate Conference raised awareness about the regional consequences of global warming, and brought stakeholders together in an unprecedented high-profile discussion of what we are facing and what we should do.
For over fifteen years, King County has actively fostered development of a clean fuel economy, which experts agree is a critical element to reducing global warming pollution caused by humans. In 1988, King County Executive Ron Sims (then Councilmember) proposed the establishment of a science and technology planning office that would address concerns about ozone depletion and global warming. In 2002, King County joined the Cities for Climate Protection and developed an action plan to reduce its operational emissions of greenhouse gases and targeted air pollutants. This action plan coincided with: establishment of the Green Building program and Renewable Energy policy; development of a hydrogen fuel cell at one of the County's wastewater plants; purchase of 89,000 acres of development rights at Snoqualmie forest; operation of regional transit with alternative fuels such as ultra-low sulfur diesel and biodiesel; and operation of the Cedar Hills landfill with maximum capture of methane. These measures have worked in tandem with establishment and protection of the Urban Growth Area Boundary, as well as high-density development based around easy transit access, which preliminary data suggests could reduce global warming pollution from transportation emissions on a regional level.
King County's efforts in clean energy development and carbon management and budgeting practices have led to its development of the necessary carbon management and budgeting tools to enter a carbon market with financial health and success. As a result, King County now has a best-practice carbon inventory, critical organizational expertise and resources in its departments for future emissions reduction planning and sale of carbon credits in a carbon market.
Entrance into the Chicago Climate Exchange represents an optimal opportunity for King County to reduce regional carbon emissions and to develop effective and efficient rules for emission trading.
King County Executive Ron Sims' Chicago Climate Exchange Ordinance authorizes King County's membership in the Chicago Climate Exchange.
Chronology of carbon market efforts worldwide
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The Rio Treaty, established in 1992, set a long-term objective of stabilizing greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous human-caused climate change, and represented an important first step toward creating a framework for emissions trading.
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In 2003 the Lieberman-McCain Climate Stewardship Act (United States Senate Bill 139) has proposed federal limits on carbon emissions and a system that allows for trading carbon credits (a "carbon market").
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In February 2005, the Kyoto Protocol to the United Nations Framework Convention on Climate Change entered into force, officially creating a market for the trading of emissions by over 140 signatory countries and regional organizations, which represent 62% of global emissions.
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In June 2005 the United States Senate stated in an amendment to its version of the Energy Policy Act of 2005, "It is the sense of the Senate 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 at a rate and in a manner that—"(1) will not significantly harm the United States economy; and "(2) will encourage comparable action by other nations that are major trading partners and key contributors to global emissions."
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In May 2006, the United States House of Representatives Appropriations Committee accepted a nonbinding climate change amendment that endorsed a mandatory cap on greenhouse gas emissions as a measure to reduce global warming, as long as such a program would not harm the United States economy.
Chicago Climate Exchange, King County Participation
Currently, the Chicago Climate Exchange (CCX) is the only national carbon exchange in the United States, requiring members to reduce carbon emissions and allowing trading of carbon credits and additional carbon credit projects. King County's participation in the CCX can help expand the eligibility of credits that benefit King County and many local governments. King County has a particular interest in writing rules for carbon market accounting in regard to: methane capture at landfills; regional emissions avoided by transit operations; and carbon sequestration from large forestlands. CCX offers an opportunity for King County to shape future rules on how to calculate emissions and credits from those operations.
Validation of the Chicago Climate Exchange
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The International Council for Local Environmental Initiatives (ICLEI), a network of regional governments that sponsors the Cities for Climate Protection, has entered a formal partnership with CCX to facilitate membership of additional local governments.
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In June 2005, the US Conference of Mayors unanimously recognized "the leadership of the cities that have joined the Chicago Climate Exchange and… the valuable role that the Chicago Climate Exchange plays in helping cities to achieve greenhouse gas reductions" and resolved to "[encourage] U.S. mayors to strongly consider membership for their cities in the Chicago Climate Exchange."
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Members of the CCX include such leading organizations as Ford Motor Company, IBM, Motorola Incorporated, International Paper and American Electric Power, and such governments as the State of New Mexico, the Cities of Chicago, Portland, Berkeley and Oakland.
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Other transportation organizations included in the membership of CCX are Amtrak and San Joaquin Regional Rail Commission.
King County's membership in CCX will likely influence regional businesses and organizations to join as well. This would provide leaders in our regional economy the opportunity, through market transactions, to support the County's environmentally-friendly programs while also reducing their own emissions.