Emissions Trading Plan

* Regarding the editorial on the South Coast Air Quality Management District’s RECLAIM program (“It’s a Lot Better Than Big Brother,” Sept. 6), The Times is correct in stating that the district deserves credit for working with business leaders to help alleviate concerns related to the program’s enforcement provisions and overall complexity. However, the Gas Co. and many facilities affected by the proposed emissions credits trading program believe the district still has a long way to go.

The district has failed to address the concerns of all business interests throughout the region, particularly those smaller facilities, which produce fewer emissions but would face increased compliance costs by as much as 600% if RECLAIM is adopted. Meanwhile, larger facilities would receive the lion’s share of the program’s benefits. By the district’s own analysis, nearly 90% of RECLAIM’s $93-million average annual cost savings would go to three industries alone.

RECLAIM, as currently drafted, in our estimation is not preferable to “Big Brother.” Despite the district’s attempt at simplifying the procedures, the program remains a complicated and unbalanced approach to cleaning up the region’s air, and has all the potential of becoming a “Bigger Brother.”

While the Gas Co. was an early supporter of a market-based concept, after nearly three years of working out the details with district staff, we concluded that the program failed to deliver the promised flexibility and lower cost potential envisioned in a market-based emission reduction plan.

The Gas Co. remains opposed to the current program, but we believe there is some hope that it will work--by making it mandatory for the very large facilities that receive the greatest economic benefits and optional for smaller facilities. Smaller facilities may choose to participate under RECLAIM if it is cost-effective, or remain under current regulations and requirements. Air quality improvements can still be achieved with this approach and everyone can share in the benefits. This, we believe, is the truly fair and market-driven approach to cleaning up our region’s air.

ANNE SHEN SMITH

Vice President, Environment & Safety

The Gas Co., Los Angeles