Environment & Science

Air district might ax controversial cap-and-trade program

Nitrogen oxide and sulphur oxide contribute to air pollution.
Nitrogen oxide and sulphur oxide contribute to air pollution.
David McNew/Getty Images

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Southern California air quality regulators are considering dropping a controversial local cap-and-trade program designed to curb certain non-greenhouse gas pollutants.

The South Coast Air Quality Management District's RECLAIM program lets refineries, power plants, cement plants and other industries install pollution controls or buy credits in exchange for emitting pollutants like nitrogen oxide and sulphur oxide. The state has its own cap-and-trade program, but it is focused on greenhouse gasses.

Now the AQMD, which regulates smog in L.A., Orange, San Bernardino and Riverside counties, is looking at eliminating the RECLAIM program.

"We are looking to get an additional five tons per day of nitrogen oxide reductions," said Philip Fine, AQMD's deputy executive officer. "And one way we might be able to achieve that would be actually sunsetting the program and returning to a command and control type of regulatory framework."

Such a switch would be welcomed by environmentalists, who have criticized the program for not meeting federal clean air standards. When it comes to non-greenhouse gasses, environmentalists prefer the command and control approach, where regulators set emissions limits and the industry must meet them.  

The possible policy change comes against the backdrop of the U.S. Environmental Protection Agency's ruling earlier this year that the RECLAIM program was illegal. It said an oversupply of pollution reduction credits had depressed their prices, making it much cheaper for industrial plants to buy credits rather than install pollution controls. As a result, Southern California was not meeting federal standards for cutting nitrogen oxide emissions, according to the EPA, which called on the AQMD to submit new regulations that would ensure compliance with the Clean Air Act.

Switching to the command and control system would run counter to the market-friendly approach of the AQMD's Republican-led board of directors. The board came under fire earlier this year for firing its top executive, known for favoring a stronger regulatory style.

The board will take up the possibility of eliminating the RECLAIM program at its Feb. 2017 meeting.