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106
program (Drury et al, 1999, p. 277). When the price spike happened in 2000, the
business sector successfully lobbied the government to stabilize the price and increase
the cap. After the stabilization of the price of RTCs of NOx, the industrial participants
do not need to worry about a new price spike. Therefore, the primary choice for most
industrial participants would be buying cheap RTCs rather than adopting new
technology or innovation. Moreover, SCAQMD did not have an emergency plan for
skyrocketed prices of RTCS during the initial rulemaking of RECLAIM.26 Market
manipulation might also mislead trading activities. An environmental NGO official
said that “they (emissions trading programs) are ripe for fraud and manipulation”27. It
was found that the market of emissions trading may be manipulated by industrial
participants or brokers, who provide misinformation to create inadequate perceptions
on demand, supply and RTC prices (EPA, 2002, p. 19).
5.3.2 The Marginalization of NGOs
Environmental governance involves multiple stakeholders; yet the roles of
stakeholders vary a lot during the implementation of RECLAIM.
Traditionally, citizen participation has been a critical part of environmental
regulation (Laurian, 2004). As major stakeholders of the RECLAIM program,
communities and environmental groups have open accesses, such as public hearing,
notice-and-comment rulemaking, to participate in the design and revision of
26 Global Warming Emissions Cap and Trade Program Forum --the RECLAIM Example, April 26,
2007, Diamond Bar, CA.
27 Interviewee from California Environmental Rights Alliance.
Object Description
| Title | Processes, effects, and the implementation of market-based environmental policy: southern California's experiences with emissions trading |
| Author | Zhan, Xueyong |
| Author email | xzhan@usc.edu; xueyongzhan@gmail.com |
| Degree | Doctor of Philosophy |
| Document type | Dissertation |
| Degree program | Public Administration |
| School | School of Policy, Planning, and Development |
| Date defended/completed | 2008-07-01 |
| Date submitted | 2008 |
| Restricted until | Unrestricted |
| Date published | 2008-10-30 |
| Advisor (committee chair) | Tang, Shui-Yan |
| Advisor (committee member) |
Mazmanian, Daniel A. Henry, Ronald |
| Abstract | This research provides a positive explanation of the implementation processes and effects of market-based environmental policy by conducting a case study on RECLAIM (Regional Clean Air Incentives Market), the first regional emission permits trading program that has been implemented by South Coast Air Quality Management District (SCAQMD) to address air pollution problems in the Los Angeles air basin since 1994.; Firstly, I developed a game theoretic model of environmental policy implementation. This model integrates theories of administrative rulemaking, policy implementation, institutional rational choice and transaction cost politics. I argue that administrative agency tries to minimize political transaction costs of policy implementation when writing rules.; Based on the formal model, I conducted a quantitative analysis to examine the interactions between SCAQMD and its key stakeholders, such as federal, state and local governments, businesses, and environmental NGOs, during the rulemaking of RECLAIM. I found that SCAQMD is more likely to adopt rule changes suggested by state and federal environmental agencies. This research identifies the dominant role of organized interest groups, the existence of interagency lobbying, and the lack of citizen control over the rulemaking of RECLAIM. Furthermore, I conducted an evaluation of the rules governing the RECLAIM program, and I identify the major distortions of the RECLAIM rules in comparison with an ideal cap-and-trade emissions trading market. Also, I used OLS regression to examine the effects of policy difference on emission level in California between 1990 and 1999. This evaluation fails to reject the null hypothesis that using cap-and-trade (CAT) compared with using command-and-control (CAC) has no different effects on emission of both NOx and SO2 from point sources at the county level in California in the 1990's.; In summary, this research finds that the implementation of emissions trading is political, and interest group politics may distort the regulatory design and implementation of an emissions trading program. While cap-and-trade is promising to better protect our environment and natural resources, its implementation is conditioned by many political and administrative factors. Inadequate rules may come as the results of political compromises, and they may impact the functioning of an emissions trading system. |
| Keyword | emissions trading; rulemaking; RECLAIM; implementation; environmental governance |
| Geographic subject (city or populated place) | Los Angeles |
| Geographic subject (state) | California |
| Coverage date | 1990/2000 |
| Language | English |
| Part of collection | University of Southern California dissertations and theses |
| Publisher (of the original version) | University of Southern California |
| Place of publication (of the original version) | Los Angeles, California |
| Publisher (of the digital version) | University of Southern California. Libraries |
| Provenance | Electronically uploaded by the author |
| Type | texts |
| Legacy record ID | usctheses-m1719 |
| Contributing entity | University of Southern California |
| Rights | Zhan, Xueyong |
| Repository name | Libraries, University of Southern California |
| Repository address | Los Angeles, California |
| Repository email | cisadmin@lib.usc.edu |
| Filename | etd-Zhan-2335 |
| Archival file | uscthesesreloadpub_Volume44/etd-Zhan-2335.pdf |
Description
| Title | Page 117 |
| Contributing entity | University of Southern California |
| Repository email | cisadmin@lib.usc.edu |
| Full text | 106 program (Drury et al, 1999, p. 277). When the price spike happened in 2000, the business sector successfully lobbied the government to stabilize the price and increase the cap. After the stabilization of the price of RTCs of NOx, the industrial participants do not need to worry about a new price spike. Therefore, the primary choice for most industrial participants would be buying cheap RTCs rather than adopting new technology or innovation. Moreover, SCAQMD did not have an emergency plan for skyrocketed prices of RTCS during the initial rulemaking of RECLAIM.26 Market manipulation might also mislead trading activities. An environmental NGO official said that “they (emissions trading programs) are ripe for fraud and manipulation”27. It was found that the market of emissions trading may be manipulated by industrial participants or brokers, who provide misinformation to create inadequate perceptions on demand, supply and RTC prices (EPA, 2002, p. 19). 5.3.2 The Marginalization of NGOs Environmental governance involves multiple stakeholders; yet the roles of stakeholders vary a lot during the implementation of RECLAIM. Traditionally, citizen participation has been a critical part of environmental regulation (Laurian, 2004). As major stakeholders of the RECLAIM program, communities and environmental groups have open accesses, such as public hearing, notice-and-comment rulemaking, to participate in the design and revision of 26 Global Warming Emissions Cap and Trade Program Forum --the RECLAIM Example, April 26, 2007, Diamond Bar, CA. 27 Interviewee from California Environmental Rights Alliance. |
