Wednesday, Jan. 24, 2007 | Three years ago, El Paso Electric began tearing down black-smoke spewing brick kilns across the border in Ciudad Juarez. The battery covers, pallets and old tires the open-pit kilns burned were a significant source of sooty air pollution in the sister border cities’ shared air.

Faced with new state clean-air regulations, the Texas utility found an innovative solution. Instead of upgrading its power plants’ emission controls, it built cleaner kilns in Mexico — a cheaper but more effective solution. The company got credit for the air pollution reduction and its plants were able to continue operating near capacity.

That innovative swap’s facilitators are now hoping to pull off a similar trade this year in the San Diego-Tijuana region, with another pollutant in mind: The greenhouse gases that fuel global warming.

Rick Van Schoik, managing director of the Southwest Consortium for Environmental Research and Policy at San Diego State University, wants to reduce carbon dioxide or methane emissions from a heavily polluting Tijuana source. A San Diego company could pay for those reductions to offset its greenhouse gas emissions to prepare for the eventual compliance with a new state global warming law.

Greenhouse gases such as carbon dioxide are spewed out of car tailpipes and released by power plants as a byproduct of combustion. As the world’s energy consumption has increased, so has the carbon dioxide concentration in the atmosphere. Scientists say it is increasingly trapping the sun’s heat and warming the planet.

Until recently, California businesses have had little financial incentive to reduce their carbon dioxide emissions. But state global warming legislation adopted in September requires a 25 percent cut in carbon dioxide pollution by 2020, reducing emissions to 1990 levels. To help, the legislation established the framework for a market-based “cap-and-trade system,” which would set regulatory limits for businesses’ greenhouse gas emissions.

Here’s how a cap-and-trade system would work: If a utility company reduced a power plant’s emissions below the state limit, it could shift the surplus savings to another plant or sell those credits to a larger polluter. Selling the credits on an open market ensures that the most efficient reductions are made. With the threat of regulatory action looming, big polluters would have to either buy credits, upgrade their emissions controls or potentially face fines.

Van Schoik said the legislation and Mexico’s ratification of the 1997 Kyoto Protocol, which both allow trading, have primed the region for a swap that will not only reduce greenhouse gases but also improve air quality in the air the cities share.

The idea of buying credits, sometimes called “carbon offsets,” has grown in popularity during the last year. Several websites allow people to calculate their carbon footprint — how much carbon dioxide they emit driving to work or flying to a business meeting — and offer to plant trees based on the total. Offsetting a ton of carbon dioxide, about how much a car emits driving 3,000 miles, can cost between $5 and $30.

Van Schoik doesn’t aim to plant trees. He wants to facilitate several pilot credit exchanges between businesses, making inexpensive gains in Mexico that have already been achieved in the United States. Tijuana’s landfills are unlined and emit methane, the second-largest source of greenhouse gases. Covering part of a Tijuana landfill and extracting the methane — an energy source — would effectively reduce its contributions to global warming, Van Schoik said, “because Mexico has done so little to clean up their landfills.”

A San Diego company could pay for the improvements in Mexico; Van Schoik’s consortium would confirm they were made; and state regulators would certify the reductions, crediting the local company. State legislation would be needed to enable such a trade.

At Tijuana Rodriguez International Airport, generators used to start jet engines are less efficient than those used in the United States and could be replaced. Or cars in Tijuana’s city fleet that emit dirtier air than their California counterparts could be junked and replaced.

“Everyone is looking for a solution. This one is so obvious it slaps us in the face,” Van Schoik said. “It’s not a permit to pollute. It’s an opportunity to exploit this economic asymmetry we have with our neighbor.”

Put another way: Cutting pollution in Mexico is cheaper than cutting it in the United States and the benefits can be greater. More bang for the buck. And because global warming is a global problem, emissions can be reduced anywhere and still have the same far-reaching benefit.

Van Schoik sees two benefits in targeting a Tijuana-San Diego trade. Replacing a polluting engine or a black-smoke spewing car can improve the border’s air quality while combating greenhouse gas emissions, he said.

“The major advantage of [the trades] is that they allow emitters to reduce total emissions in the most efficient manner possible,” said Chris Erickson, an economics and international business associate professor at New Mexico State University, who has studied cross-border pollution trades. “If Mexico can reduce their emissions at a lower cost than the United States, we both win.”

But Erickson said he doesn’t see the national political will necessary to effect the greenhouse gas reductions needed to stop global warming.

“I’m very pessimistic about success,” he said, “so any attempt that moves the process I’m in favor of.”

The Bush administration and many businesses oppose cap-and-trade systems, because they say they will damage the economy without producing noticeable emissions reductions. Some argue that emissions from China and India, rapidly industrializing countries not currently required to make reductions in their greenhouse gas output, will outpace any reductions made elsewhere. This is an underlying reason why the United States has not ratified the Kyoto Protocol, which aimed to reduce the globe’s greenhouse gas emissions 5 percent by 2012. Mexico has signed Kyoto, allowing it to benefit from an emissions trade.

But some see little reason to reduce Mexico’s greenhouse gases emissions before making significant strides in the United States, the world’s largest source.

“In the short run, if Mexico can reap those benefits … it’s fine and dandy,” said Carlos de la Parra, a research professor at El Colegio de la Frontera Norte in Tijuana. “Sooner or later, this thing is going to catch up. If you don’t curb greenhouse gas emissions in the United States, you’re not doing a whole lot.”

Van Schoik said he expects an initial cross-border trade to reduce greenhouse emissions by hundreds of tons, a small step toward solving a massive problem. Consider that burning a gallon of gasoline produces 20 pounds of carbon dioxide; an average car driving 15,000 miles a year releases five tons. And combined, San Diegans drive a combined 80 million miles a year.

But Van Schoik said a trade would be a beneficial early step for San Diego businesses that want to address greenhouse gas limits expected from the California Air Resources Board, the state regulator responsible for implementing the September global warming legislation.

Those limits are not imminent. Jerry Martin, an air board spokesman, said the board must first increase its 1,000-member staff by about 110 people to accommodate the new global warming workload. The legislation’s other goals are more immediate, he said.

“A cap-and-trade program, if one happens, certainly will not be something that’s coming forth in the short-term,” Martin said. “We have to first develop a reliable [emissions] inventory. That’s very important. You can’t cap it and trade it unless you know what it is.”

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