A new report by the California Air Resources Board (CARB) was released last week that provides an updated analysis of the impact that AB32 will have on the economic growth of California. This report comes about a year and a half after the last one released by the CARB staff that received some criticism from outside economists due to the report making some questionable assumptions. In response to this, ARB appointed a board of 16 experts called the Economic and Allocation Advisory Committee (EAAC) to help CARB staff during the analysis, as well as contribute its own peer review of the analysis.
The result confirms that AB32 will have a positive impact on growth, although that impact was slightly less than in the original report. It is estimated that despite the economic downturn, two million jobs will be created by 2020, the economy will grow at 2.4% per year, and that $3.8 billion will be saved in reduced consumption of gasoline and diesel fuel.
The first part of this report outlines the economic benefits to California that AB32 would bring, and answers one of skeptics' prime questions: will AB32 take jobs away from Californians? The answer, quite simply, is No.
In fact, the report states that this shift toward a clean economy will create a sustained growth of about .9 percent each year. The key, according to the report is "shift the driver of economic growth from cheap but polluting energy sources to clean energy and efficient technologies." In addition, this new report explains that although some industries like fossil fuel burning utilities and mining will take a hit under the new climate laws, overall, businesses can be expected to flourish.
It is anticipated that "small businesses may expect to see an increase in employment and output as consumers invest in more efficient appliances and improve energy efficiency of their homes." The reality is that not only will most industries, including small businesses prosper under this law, but that without AB32 will incur higher costs.
The second part of this report released by ARB analyzes the future possibilities if California fails to go through with AB32. Diverging from this plan would actually increase costs and individual Californians as well as small businesses would carry the majority of this burden. The report makes a point to weigh both the environmental as well as the economic repercussions of diverging from AB32. It states that "By transitioning to clean energy, we will shift our economy towards the future, and avoid the serious mistake states like Michigan made in using government to try to prop up outdated jobs in dirty industries."
Unlike other reports from different sources and with contrary findings, this one makes a point to include the opinions of impartial experts. These facts make it clear that not only will AB32 help our economy, but is necessary to get back on track.