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Toward a Constructive Dialogue on Federal and State Roles in U.S. Climate Change Policy

State Fed Roles


Toward a Constructive Dialogue on Federal and State Roles in U.S. Climate Change Policy

Prepared for the Pew Center on Global Climate Change
June 2008

Franz T. Litz, Esq.
Senior Fellow, World Resources Institute

Press release

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In the United States to date, most of the first genuine steps toward addressing the challenge of climate change have taken place at the state level.1 Many states have proceeded in a meaningful, comprehensive fashion while the federal government struggles to take its first significant step toward legislative or regulatory action. Yet it is clear that these state actions, even when taken together, are not enough to put the United States on a course to reduce greenhouse gas (GHG) emissions to the level deemed necessary by the science. Nationwide action requiring reductions in all 50 states will be necessary. Assuming the federal government will eventually put such a comprehensive program in place, however, a number of questions arise as to the appropriate division of responsibilities between state and federal governments across the many areas where climate change action is needed.

Given the relative historical competencies of state and federal governments, it is neither desirable nor likely that the federal government will step in comprehensively to eliminate any state role in tackling climate change. Indeed, some areas central to climate change policy, such as smart growth and land use planning, fall within the near-exclusive purview of state and local governments. At the other extreme are international climate change negotiations leading to international agreements, which is a matter for exclusive federal control. Most areas relevant to climate change policy, however, fall between these two extremes and have historically been shared by both state and federal governments.

Against the current and historical jurisdictional backdrop, the key question is not whether responsibility for climate change action should rest exclusively with the federal government or the states, but rather how the federal government and the states should share responsibility for tackling the problem. It is difficult to imagine the federal government stepping in to assume exclusive and broad authority over all activities in the United States that contribute to climate change. Because legal authority is already shared in many of these areas, the appropriate questions relate to the degree to which state and federal governments will continue to share responsibility. Will the path forward rely most heavily on the states to tackle the problem, with the federal government stepping in to make sure all states are acting with comparable vigor? Or will future climate change policy place the federal government in the dual role of both devising and implementing policy from Washington, D.C., perhaps with the states acting as local enforcers? Or will Congress devise an approach that places certain key responsibilities with federal agencies while vesting other key responsibilities with the states?

This paper aims to further a constructive dialogue on the appropriate roles for state and federal government in meeting the challenge of climate change in the United States. Section II includes a brief overview of the climate change actions taken by states, a review of the common issues that have arisen in the debate over state action, and a brief exposition of the relevant historical areas of federal and state authority. Section III summarizes the law of federal preemption to provide a basic understanding of the various way state policy can be affected by federal action. Section IV briefly explores the state and federal partnership established under the federal Clean Air Act for reducing air pollution, noting some key experiences with the Clean Air Act as it relates to the division of federal and state responsibility. Section V examines three possible approaches to comprehensive nationwide climate change action, taking into account the challenges and benefits associated with each option. Section VI sets out some key conclusions, questions, and principles for a continuing dialogue on these issues.In the United States to date, states have taken most of the significant actions to address climate change. Yet enactment of a nationwide program requiring reductions across the entire United States is both necessary and increasingly likely. This prospect raises a number of questions as to the appropriate division of responsibilities between state and federal governments across the many areas where climate change action is needed. The key question is not whether responsibility for climate change action should rest exclusively with the federal government or the states, but rather how and to what degree the federal government and the states should share responsibility for tackling the problem.

A number of arguments exist to support state-level action on climate change. States have historically played a role as effective first-movers on important environmental issues, functioning as policy innovators, testing policies that have later been adopted at the federal level. States also bring an understanding of the unique circumstances within their boundaries and a familiarity with their stakeholders. States drive federal action, sometimes insisting that policies be strengthened even after the federal government has acted.

There are also numerous arguments in favor of a strong federal role in climate policy. A federal program would bring every state into the climate change effort and tend to level the playing field for businesses in all 50 states. Federal action offers a platform for engaging with other nations in forging an international emissions reduction agreement. A national GHG cap-and-trade program would keep costs manageable and drive climatefriendly technological innovation, and could link with other markets around the world.

Given the strong reasons for both state and federal action on climate change, it is perhaps not surprising that historically state and federal governments have chosen to share authority over most areas where climate change action is needed. This is true across most air pollution control, energy supply, energy efficiency, transportation, forestry and agricultural policy areas. Rather than asking whether federal or state government is best able to address climate change, the more relevant question is which level of government should tackle which parts of the challenge.

Precisely how to delineate state and federal roles in a comprehensive nationwide climate change program should be the focus of a constructive national dialogue. This paper evaluates several possible approaches along a continuum from heavy reliance on federal action to heavy reliance on state action. The scenarios examined differ in the degree to which responsibility for reductions is shared between federal and state governments, but each recognizes that some action will be required at both levels.

Federal action on climate change is needed to achieve the significant reductions science demands and to establish a minimum level of uniformity across the U.S. economy. This federal action can preserve room for states to continue in their important roles as policy innovators, on-the-ground implementers, and policy drivers, and to capitalize on the significant experience in the states across the many aspects of climate change action. A federal climate change program will be most successful if it is designed with the relative strengths of each level of government in mind.

About the Author


Franz T. Litz, Esq.

Franz Litz is a Senior Fellow at the World Resources Institute.  Before joining WRI, he served four years as the Climate Change Policy Coordinator for the New York State Department of Environmental Conservation. In that role, Franz served as New York’s principal representative to the Regional Greenhouse Gas Initiative (RGGI).  He is currently engaged in advising the Western Climate Initiative and is also active in ongoing state and regional climate action in the U.S. Midwest.



Related Material:

Innovative Approaches to Climate Change: A State and Federal Workshop
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Franz T. Litz

Ohio Appropriates $150 Million for Alternative Energy and Coal Research

Promoted in Energy Efficiency section: 

On June 12, 2008, Ohio Governor Ted Strickland signed HB 554, a $1.57 billion economic stimulus package.  Included among the appropriations are $84 million over three years devoted to low-carbon energy sources including wind, solar, geothermal, hydro, and solid waste energy sources.  It also includes funding for distributed electricity generation, combined-heat-and-power, nuclear power and fuel cells.  In addition, the bill appropriates $66 million to research and develop technologies to reduce coal emissions.

Press Release
HB 554

Analysis of HB 554

Connecticut Enacts Greenhouse Gas Emissions Targets

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On June 2, 2008, Connecticut Governor Jodi Rell signed into law House Bill 5600, which sets a statewide Greenhouse Gas (GHG) emissions reduction target of 10 percent below 1990 levels by 2020.  Additionally, barring intervention at the federal level or through the Regional Greenhouse Gas Initiative (RGGI), the act requires an 80 percent GHG reduction below 2001 levels by 2050.  The act also presents a timetable for achieving the 2020 reductions: it calls for a statewide GHG inventory to be published by December 2009; modeling scenario results by July 2010; and recommended GHG reduction strategies by July 2011.   Connecticut is one of ten states participating in RGGI, which is set to launch a regional CO2 cap-and-trade program on January 1, 2009.

HB 5600
Regional Greenhouse Gas Initiative (RGGI)
State Target GHG Emissions

Bay Area Air Quality Management District Enacts Greenhouse Gas Fee

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On May 21, 2008, the Bay Area Air Quality Management District (BAAQMD) voted 15-1 to approve a new Greenhouse Gas (GHG) Fee for stationary sources.  Effective July 1, 2008, over 2500 GHG sources across the region, such as power plants, oil refineries and cement plants, will be subject to a fee of 4.4 cents per metric ton of CO2 equivalent.  Most facilities are expected to pay less than $1 annually, while the top seven emitters in the region will owe more than $50,000.  According to BAAQMD’s Staff Report, the Fee’s estimated Fiscal Year 2009 revenue of $1,116,000 is intended to offset the costs of the District’s Climate Protection Program (CPP).  The CPP provides input and support for helping meet the statewide emissions targets established in the 2006 California Global Warming Solutions Act, AB 32. The fee represents one of the first policies of its kind in the United States; the city of Boulder, Colorado, enacted a tax on GHG emissions from electricity generation in November 2006.

BAAQMD Staff Report
Read more about the California Global Warming Solutions Act
Boulder Climate Action Plan Tax

Ohio Adopts Alternative Energy Portfolio Standard

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On May 1, 2008, Governor Ted Strickland signed substitute Senate Bill 221 into law, establishing an alternative energy portfolio standard (AEPS) for the state of Ohio.  The law mandates that by 2025, at least 25 percent of all electricity sold in the state come from alternative energy resources.  At least half of the standard, or 12.5 percent of electricity sold, must be generated by renewable sources such as wind, solar (which must account for at least 0.5 percent of electricity use by 2025), hydropower, geothermal, or biomass.  At least half of this renewable energy must be generated in-state.  In addition to renewables, the additional 12.5 percent of the overall 25 percent standard can also be met through alternative energy resources like third-generation nuclear power plants, fuel cells, energy-efficiency programs, and clean coal technology that can control or prevent carbon dioxide emissions.  The bill also creates a renewable energy credit (REC) tracking system, which allows utilities to buy, sell, and trade credits to comply with the renewable energy and solar energy requirements.  Additionally, electric utilities will be required to achieve energy savings of 22.5 percent by the end of 2025 through energy efficiency programs. Utilities must also implement programs to reduce peak energy demand one percent beginning in 2009, and an additional .75 percent per year through 2018.  With the enactment of this new legislation, Ohio becomes the 27th state to establish a renewable electricity standard.

SB 221 authorizes the Public Utilities Commission of Ohio (PUCO) to develop rules for decoupling, a mechanism that separates utility profits from the volume of electricity sales.  The bill also requires PUCO to adopt rules establishing greenhouse-gas reporting requirements, including participation in the Climate Registry, which aims to develop a common system for tracking GHG emissions between jurisdictions.

SB 221
States with Renewable Portfolio Standards

Eighteen States Sign Declaration on Climate Policy

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On April 18, 2008, at  Yale University’s 2008 Conference of Governors on Climate Change, four governors  - along with  representatives from another 14 states - signed a joint declaration on the future of climate change policy in the United States. 

In agreeing to the declaration, the state representatives and the participating governors – Jon Corzine of New Jersey, M. Jodi Rell of Connecticut, Arnold Schwarzenegger of California, and Kathleen Sebelius of Kansas – recommitted to the task of addressing climate change.  The declaration identifies several principles to help inform national climate policy, including the need for a partnership approach between the federal and state governments, that state-based programs should continue to receive support, and that mandatory action at both the state and federal level should be rewarded and encouraged. The signatories pledged to coordinate their respective efforts, and to solicit the support of other states and members of Congress in taking action. They also agreed to reach out to current Presidential candidates in order to help shape the first 100 days of the next Administration.

In addition to the four states represented by the participating governors, the 14 other states who signed the policy declaration included Arizona, Colorado, Delaware, Florida, Illinois, Maryland, Massachusetts, Maine, Michigan, New Mexico, New York, Oregon, Virginia, and Washington.  The Conference also included presentations and keynote addresses from a number of speakers, including Nobel Laureate Dr. R.K. Pachauri, California Governor Arnold Schwarzenegger, and Theodore Roosevelt IV, Chair of Strategies for the Global Environment, the umbrella organization for the Center for Climate and Energy Solutions, formally the Pew Center on Global Climate Change.

Yale University 2008 Conference of Governors on Climate Change

Governors' Declaration on Climate Change

States Sue U.S. Environmental Protection Agency

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On April 2, 2008, 12 states, the District of Columbia, two cities, and several environmental groups sued the U.S. Environmental Protection Agency over its failure to regulate greenhouse gas emissions from motor vehicles. The states and other petitioners are asking the U.S. Circuit Court of Appeals for the District of Columbia to force the EPA to issue within 60 days its formal determination of the public health impacts from GHG emissions. In filing their suit, the plaintiffs cited the Supreme Court’s April 2007 decision in Massachusetts et al v. EPA, in which the Court ruled that the EPA is authorized to regulate greenhouse gases under the federal Clean Air Act, and must consider doing so unless it can demonstrate that these gases do not contribute to climate change that harms human health and welfare. Since the Supreme Court’s ruling, the EPA has not issued any formal language or rules for the regulation of CO2 or other greenhouse gases. The states joining the lawsuit include California, Connecticut, Illinois, Maine, Massachusetts, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, Washington, Arizona, Delaware, Iowa, Maryland and Minnesota.

Read the Petition

Kansas Governor Forms Climate Change Advisory Group, Initiates Climate Action Plan

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On March 21, 2008, Governor Kathleen Sebelius signed Executive Order 08-03, which establishes the Kansas Energy and Environmental Policy Advisory Group. The new 25-member Advisory Group will recommend steps that the state can take to reduce its greenhouse gas emissions, as well as a proposed timetable for implementation of those recommendations. The Advisory Group will consider issues such as community economic development and electricity generation, and opportunities for diversifying the state’s energy portfolio. Kansas joins 36 other states in formulating a climate action plan. Having previously denied permits to two new coal-fired power plants, Governor Sebelius also vetoed Senate Bill 327, which would have allowed construction of the plants to continue.

Press Release
Executive Order 08-03
Senate Bill 327
Governor's Message for Senate Bill 327

Vermont Governor Signs Efficiency Bill

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On March 20, 2008, Governor Jim Douglas signed into law Senate Bill S.209, the Energy Efficiency and Affordability Act of 2008.  The act establishes a statewide goal of producing 25 percent of the energy consumed in the state from renewable sources, particularly Vermont’s farms and forests, by 2025.  The act increases the use of net metering in the state and expands the use of biodiesel in state buildings and the state’s vehicle fleet.  It also includes new funding for efficiency programs that will coordinate expertise, technical assistance, and resources, as well as tax incentives designed to help promote investment in renewable energy resources.  In addition, the act establishes a fuel efficiency fund, financed by revenues from the sale of the state’s emission allowances under the Regional Greenhouse Gas Initiative’s (RGGI) cap-and-trade program.

Energy Efficiency and Affordability Act of 2008

Washington Governor Signs Climate Change Bill

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On March 13, 2008, Washington Governor Christine Gregoire signed into law House 2815, the Climate Change Framework/Green-Collar Jobs Act. The bill calls for reductions from the state’s transportation sector, Washington’s largest contributor to greenhouse gas emissions, by cutting vehicle miles traveled by 18 percent by 2020, 30 percent by 2035, and 50 percent by 2050. The bill directs state agencies to provide training and incentives in an effort to attract green-collar jobs to Washington. It also requires the state’s largest emitters to inventory and report their emissions beginning in 2010, and directs relevant state agencies to continue working regionally with other Western states and Canadian provinces to design and implement a market-based system to reduce greenhouse gas pollution from major sectors of the economy. Statewide targets adopted in 2007 require a reduction of greenhouse gas emissions to 1990 levels by 2020, 25 below 1990 levels by 2035, and 50 percent below 1990 levels by 2050. This new bill directs the Department of Ecology to submit a comprehensive plan to the legislature, outlining specific measures to reach these targets, and to provide an update on Washington’s ongoing participation in the Western Climate Initiative multisector cap-and-trade design process.

Press Release
HB 2815

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