July 1, 2020

Dear Commissioners Milford, Butler, Gerber, Gonzalez, Grobe, Jones, Rueter, Schendler, and Williams:

The Colorado Coalition for a Livable Climate has supported the adoption of strong greenhouse gas (GHG) emission reduction goals by the State since our inception in 2015.  We have followed the Air Quality Control Commission’s rulemaking efforts this year with both interest and concern.  Our concerns center around the fact that the one regulation approved to date does not go very far toward meeting the ambitious climate goals set by the General Assembly in the spring of last year.  Further, we do not see much sense of urgency on the part of either the Colorado Department of Public Health and Environment (CDPHE) or the Colorado Energy Office (CEO) in supporting the development of rules that are up to the task of meeting those goals.

Although we understand the resource constraints faced by the CDPHE, the CEO, and the AQCC itself, we do not view working seriously to meet the goals set by the General Assembly for 2025 and 2030 as “optional.”  In fact, the world as a whole will need to achieve net zero greenhouse gas emissions by the mid-2030s in order to have a better than even chance of avoiding the catastrophe that would ensue should the average global temperature increase by more than 1.5° Celsius over pre-industrial levels.

According to the latest Colorado Greenhouse Gas Inventory Report, 60% of the State’s GHG emissions in 2020 will come from three economic sectors: electric power, natural gas and oil extraction, and transportation.  The CCLC therefore respectfully recommends that the AQCC focus its efforts on those three sectors as it develops rules to meet the first goal established by the General Assembly: 26% overall GHG emission reductions by 2025 compared to 2005 levels.

We have performed an analysis that suggests that 70% GHG emission reductions in the electric power sector, 25% GHG emission reductions in the natural gas and oil sector, and 13% GHG emission reductions in the transportation sector compared to 2005 levels would be sufficient to achieve the 2025 goal.  That analysis is attached to this letter.

We propose the following three rules – in broad outline – to achieve these emission reductions:

  1. Require every utility operating in Colorado to reduce its GHG emissions by 70% compared to 2005 levels by 2025.
    1. Utilities should be required to submit their plans for doing this to the AQCC by the end of 2022, and to put their plans in place no later than January 1, 2024.
    1. The AQCC should establish a schedule of fines that would apply to utilities in case of non-compliance.
  • Establish GHG emission reduction requirements for each oil and gas operator in the State based on current production and leakage levels sufficient to reduce the sector’s GHG emissions by 25% compared to 2005 levels by 2025.
    • This rule should go into effect no later than January 1, 2024.
    • The AQCC should establish a schedule of fines and/or shut down enough oil and gas wells owned by each operator by January 1, 2025 in case of non-compliance in order to bring those operators into compliance.
  • Establish a “feebate” program for new vehicle purchases that would increase registration fees significantly for fossil fuel-powered vehicles and increase rebates significantly for electric vehicles.
    • This program should be put in place no later than January 1, 2024.
    • The fees and rebates should be set based on an economic analysis that would have 13% GHG emission reductions compared to 2005 levels for this sector as the goal.
    • This is a “market-based approach”, and as such does not require any penalties in case of non-attainment of the goal in the first year.  Instead, the new registration fee and rebate schedule should be modified in subsequent years as necessary in order to meet the goal.

We believe that the AQCC should prioritize work on the first proposed rule, since it would have the largest impact.  Work on that rule should begin this year and be completed as early as possible next year.  Development of the second and third proposed rules should begin next year, and be completed either later that year or in early 2022.

We are not certain that the recommended new vehicle feebate program could be established by rule.  If it cannot be, the AQCC should consider increasing the emission reduction targets for the electric power and natural gas and oil extraction sectors, and recommend that the General Assembly pass a law putting the feebate program into place.

We believe that adoption of these proposed rules would allow the State to meet its 2025 climate goal with minimal economic impact.  Please do not hesitate to contact us should you have any questions concerning our analysis or recommendations.  We would welcome the opportunity to speak with each of you.