Regional Stakeholders Workshop

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RegionalStakeholders Workshop

• January 10, 2008
• Portland, Oregon

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Overview
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Western Regional Climate Action Initiative (WCI)

• Collaboration of Western states, provinces and
  Mexican states to reduce greenhouse gas emissions
  in our region
• Partners include
• Washington, Oregon, California, Arizona, New
  Mexico, Utah, Manitoba, British Columbia, and as
  of today, Montana
• Observers include
• Kansas, Wyoming, Nevada, Colorado, Alaska, Idaho,
  Quebec, Saskatchewan, Ontario and the Mexican
  states of Sonora and Tamaulipas

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Collaboration is to include

• Setting a regional goal consistent with each
  partners reduction goal
• Joining a multi-state registry to track, manage
  and credit entities with reductions
• Developing a design for a regional market-based
  multi-sector mechanism, such as a load-based cap
  and trade program.

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Western Climate Initiative Status

• Achieved two of the three directives
• A regional goal has been established
• 15 below 2005 by 2020
• All partners and observers have joined The
  Climate Registry
• Consistent, verifiable reporting of emissions

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Progress on design work

• 5 subcommittees underway
• Scope
• Allocations
• Electricity
• Offsets
• Reporting
• Preliminary design anticipated Spring, 2008
• Completed design by August 26, 2008

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How WCI Works

• Monthly all-partner staff working sessions in
  person
• Bi-weekly teleconferences of partners/observers
  and of subcommittee chairs
• Subcommittees engage in technical details to
  generate recommendations for partners
• Consensus decision making
• Technical support provided by partner agency
  staff, Pew Center on Climate Change, World
  Resources Institute, New America Foundation and
  The Center for Climate Strategies
• Western Governors Association provides project
  management support

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What we expect to deliver

• Memorandum of Agreement
• Recommended design elements
• Substantive Agreement
• Process to get rest of agreement
• States/provinces will use results for legislative
  authority to implement
• Further regional collaboration for ghg reductions

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Western Climate Initiative (WCI)Stakeholder
Outreach Initial Plans

• Regional outreach and communication
• Work plan and other documents submitted for
  public review and comment
• Regional teleconferences after each WCI work
  session
• Regional face-to-face workshops scheduled to date
• January 10, 2008 (Portland) Discuss major
  options under consideration (350 registered
  attendees)
• May 2008 Discuss initial subcommittee
  recommendations
• July 2008 Discuss proposed design
• WCI list serve
• Website
• State/Provincial outreach and communication

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Questions?
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Scope Design Issues

• Scope Subcommittee
• Michael Gibbs, Cal/EPA
• January 10, 2008
• Portland, Oregon

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Overview

• Scope Subcommittee
• Mission
• Members
• Work Plan
• Work Plan Comments
• Major Options
• Design Elements
• Major Options
• Questions

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Mission

• Recommend the scope of a proposed cap and trade
  program
• The sectors that fall under the cap.
• The emissions sources that fall under the cap.
• The greenhouses gases that fall under the cap.
• The point(s) of regulation where the cap would be
  enforced.
• Electric Sector evaluated by the Electricity
  Subcommittee.

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Mission (Continued)

• The Subcommittee must balance multiple
  objectives, consistent with the WCI design
  principles.
• administratively simple
• minimizes administrative costs
• covers as many sources as is practical
• minimizes the potential for leakage
• facilitates linkage

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Members


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Work Plan

• Task 0 Emissions Inventory
• Task 1 Initial Options
• Task 2 Description of Major Options
• Task 3 Option Evaluation
• Task 4 Option Recommendation

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Work Plan (Continued)

• Task 0 Emissions Inventory
• Preliminary and ongoing
• Task 1 Initial Options
• Listed in Work Plan
• Comments requested
• Task 2 Description of Major Options
• Released prior to the Workshop
• Comments requested
• Task 3 Option Evaluation
• Task 4 Option Recommendation

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Work Plan Comments


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Work Plan Comments (Continued)


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Work Plan Comments (Continued)

• What sectors should be included?

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Work Plan Comments (Continued)

• What Gases
• All 6 Kyoto gases 9 comments.
• Should thresholds be used?
• Yes 5 comments.
• List of the Design Elements
• No comments (to date).

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Major Options

• Design Elements
• Major Options
• Combinations of Design Elements
• Questions

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Design Elements

• Design Elements A through K
• Description
• Emissions and Entity Data
• Emissions at the Entity Level
• Administration
• Leakage Issues
• Working Draft solicit comments

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Design Elements


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Major Options


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Major Options (Continued)

• Design Elements not in the options
• E. Fossil Fuel Industry (oil and natural gas
  production natural gas processing)
• G. Passenger Cars, Light Duty Trucks and Medium
  Duty Vehicles (manufacturers)
• H. Large Transportation Fleets
• I. Agriculture Emissions
• J. Forestry and Land Use Change
• K. Production of High GWP Gases

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Questions

• Feasibility Subcommittees assessment of the
  design elements that are feasible.
• Options The range of options presented.
• Thresholds What thresholds (e.g., tons of
  emissions per year) are appropriate to use.
• Phasing Which design elements, if any, should
  be phased in over time.

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Questions?
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Short Break
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Allocations Design Issues
Allocations Subcommittee Steve Owens,
Chair January 10, 2008 Portland, Oregon
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Mission

• The mission of the WCI Allocation Subcommittee
  is
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• To recommend a methodology for determining the
  number of allowances to be apportioned, either
  individually to each WCI partner and thereby
  establishing each Partners overall emissions
  allowance budget for the WCI program, or
  regionally for the WCI region overall and
• To determine whether to recommend that the
  Partners establish a common method for
  distributing the budgeted emissions allowances
  (a) among covered sectors and (b) within each
  sector to covered entities.
• If a common allowance distribution method is
  recommended, the Subcommittee will recommend a
  distribution method or methods for consideration
  by the WCI Partners.
• - WCI Work Plan, 10/29/07

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Subcommittee Members

• Arizona Steve Owens, Patrick Cunningham, Ira
  Domsky, Lee Alter
• California Belinda Chen, Fereidun Feizollahi,
  Kevin Kennedy, Steve Roscow
• Colorado Ginny Bannon
• Nevada Colleen Cripps, Leo Drozdoff
• New Mexico Sandra Ely, Mary Uhl
• Oregon Phil Carver
• Utah Colleen Delaney
• Wyoming Brian Bohlmann
• British Columbia Warren Bell, Rachel Boston, Kel
  Hicke, Laura Lapp
• Ontario Jennifer Backler, David Coates, John
  Hutchinson, Seema Khanna, Tom Markowitz,
  Ray Rivers
• Quebec Michel Lesueur
• Saskatchewan Howard Loseth

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Commenters as of November 30, 2007



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Summary of Comments Received as of November 30,
2007



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Question 1

• Apportionment of Allowances
• Apportionment means the subdivision of the
  regional cap and trade emissions cap among the
  participating jurisdictions.
• Should each Partner should be authorized to
  distribute allowances equal to that Partners
  share of the regional cap, or, should a regional
  entity distribute allowances on behalf of all the
  Partners without apportioning the regional cap
  among them?

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Question 1


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Question 1


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Question 1


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Question 2

• Distribution of Allowances
• Distribution or allocation of allowances means
  the process by which emissions allowances are
  distributed for use by covered sources under an
  emissions cap and trade system.
• To what degree should distribution by the
  Partners be made uniform, or standardized, among
  participating jurisdictions?

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Allocations SubcommitteeQuestion 2


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Question 2


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Question 2

• Or, should some flexibility be allowed within
  prescribed limits beyond which all Partners must
  adopt the same distribution system?
• ISSUE The Allocations Subcommittee recognizes
  that there are many more detailed questions
  concerning the distribution of allowances than
  are asked here. The subcommittee anticipates
  seeking comment on these questions at a later
  time.
• ISSUE The Allocations Subcommittee recognizes
  the special challenges associated with the
  development of a regional system that could
  successfully merge into a future national
  program, and the additional complications of
  developing a single regional program that can
  accomplish this in two nations. The subcommittee
  seeks comments on how to ensure that the proposed
  and potential future programs will function well
  together.

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Question 3

• Allocation Methods
• There are multiple ways allowances can be
  distributed or allocated for use by covered
  sources.
• Whether and to what degree should allowances be
  distributed directly to covered sources free of
  charge?

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Question 3


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Question 3


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Question 3

• Should the allowance distribution system have the
  capacity to change over the life of the program
  through phasing in particular distribution
  methods or using different distribution bases?
• Should the Partners place restrictions on the use
  of revenues from auctioned allowances?

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Question 4

• Early Actions
• WCI cap and trade design principle
• Provide appropriate recognition and incentives
  for early emissions reductions
• How should the cap and trade program either
  encourage or hold-harmless emission reductions
  efforts that occur prior to the start of the
  program?
• Qualifying early actions would have to be
  quantifiable, verifiable, enforceable and
  permanent.

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Question 4

• The WCI Design Principles state that the program
  will provide appropriate recognition and
  incentives for early emissions reductions.
  Should the program accomplish this
• Through the selection of benchmarking and program
  start dates?

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Question 4

• Through special allocations of allowances?
• Drawn from within the cap?
• Drawn from outside the cap?

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Question 4

• Through auctioning of allowances?

• By other means?

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Questions?
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Lunch
Breakout Sessions Begin at 200 p.m.
Pacific. Breakout Webinar Access information at
www.westernclimateinitiative.org Plenary
Session will reconvene at 345 p.m.
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Public Comment Session Underway
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Suggestions for Future Meetings?
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Meeting Adjourned
Thank you for Participating!
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