SACRAMENTO, Calif. – California Gov. Arnold Schwarzenegger on Monday toured the carbon trading floor at Credit Suisse Securities, where emissions allowances are bought and sold, as he took his green initiatives to America's East Coast.
The governor was to announce an executive order Monday connecting California's landmark global warming law with the Northeast's program to reduce greenhouse gas emissions.
"Gov. Schwarzenegger wants to build a large, robust carbon trading market that will dramatically reduce emissions," said Schwarzenegger spokesman Adam Mendelsohn. "The more robust the market, the more effective we will be."
The Northeast program involves seven U.S. states that plan to reduce carbon dioxide emissions at power plants beginning in 2009.
Under the program, power plants will be granted a limited number of so-called carbon credits, equaling the amount of carbon dioxide they are allowed to emit. Those that exceed their limits must purchase credits to cover the difference, while those that produce less carbon dioxide than they are legally permitted can sell their surplus credits for a profit.
Linking California to that program could help California power plants meet their obligations under the state's new global warming law.
It is Schwarzenegger's latest move to address global warming — an issue that has often put the Republican governor at odds with the Bush administration. Schwarzenegger this summer urged the governors of Western states to join California in a regional trading system and signed an agreement with British Prime Minister Tony Blair to develop new technologies to combat global warming.
Schwarzenegger opened trading on the Nasdaq stock market Monday. He also planned to visit the country's first "green" residential high-rise building with New York Gov. George Pataki, spokesman Darrel Ng said.
The two governors were to discuss ways to connect California to the Northeast states' Regional Greenhouse Gas Initiative and create an emissions trading exchange.
Pataki helped craft the Northeast system after President George W. Bush withdrew from the 160-nation Kyoto Protocol on global warming in 2001, saying it would hurt the U.S. economy.
Schwarzenegger, who is running for re-election in November, has touted California's 2006 global warming law as a key component of his environmental record. It has also distinguished him from Bush, who has said companies should voluntarily reduce emissions. Schwarzenegger opponent Phil Angelides, the Democratic state treasurer, has embraced the law.
California's global warming law imposes the country's first mandatory statewide cap on greenhouse gas emissions, a move that has been criticized by manufacturers and cement makers — two of the largest emitters of the greenhouse gases that scientists blame for rising temperatures in many parts of the world.
In an effort to make the cap workable for businesses, Schwarzenegger has advocated setting up a market system that could enable the state's companies to buy, sell and trade emission credits instead of making their own reductions.
"Implementing a cap and trade and allowing manufacturers to offset some of the substantial costs will help manufacturers deal with the greenhouse gas mandate," said Gino DiCaro, a spokesman for the California Manufacturers and Technology Association.