Clearing the Air

The report argues that carbon pricing is likely to improve air quality in California because the most feasible GHG abatement strategies—such as energy efficiency and fuel switching—also reduce local air pollutants. Using data from the European Union (EU) Emissions Trading Scheme (ETS), the authors find a statistically significant negative relationship between carbon prices and emissions of both GHGs and local air pollutants (sulfur dioxide, nitrogen oxides, and particulate matter). Notably, EU oil refineries showed stronger reductions in local air pollutants than the average industrial facility. While cogeneration is identified as the only strategy that could potentially increase local emissions, the report suggests that existing air quality regulations and new source reviews in California should prevent such outcomes. The authors recommend that California regulators use industrial audits to maximize synergies between GHG and LAP abatement and consider financial incentives for high-benefit projects in poor air quality areas.

• Carbon pricing is expected to improve air quality in California because the actions taken to reduce greenhouse gas emissions typically also reduce local air pollution. Specifically, carbon pricing encourages industrial facilities to increase energy efficiency, reduce waste, and switch to cleaner fuels, all of which lower local air pollutant emissions.
• Analysis of the European Union's cap and trade system indicates that as carbon prices rise, both greenhouse gas and local air pollution emissions fall. In 2008, the average reporting facility saw carbon dioxide levels drop by 5 percent, sulfur dioxide by 20 percent, nitrogen oxides by 12 percent, and particulate matter by 17 percent compared to 2007.
• Oil refineries in the EU experienced more significant reductions in local air pollution than the average industrial facility. For the same change in carbon price, refineries saw a 50 percent stronger reduction in particulate matter and nearly double the reduction in sulfur dioxide and nitrogen oxides.
• Cogeneration is the only identified abatement strategy that could potentially increase local air pollution if the plant increases the facility's thermal input. However, the report asserts that existing air quality regulations, such as new source performance reviews, should prevent this in areas with poor air quality.
• The report suggests that California's cap and trade program is likely to benefit poor urban communities where oil refineries are located, as increased energy efficiency in these refineries leads to less fossil fuel combustion and fewer emissions.

APA

Hobbs, A., & Rowley, K. (2012). Clearing the Air. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2012/09/Clearing-the-Air.pdf

Chicago

Hobbs, Andrew, and Kath Rowley. Clearing the Air. Climate Policy Initiative, 2012. https://www.climatepolicyinitiative.org/wp-content/uploads/2012/09/Clearing-the-Air.pdf.

Wikipedia

{{cite report |last1=Hobbs |first1=Andrew |last2=Rowley |first2=Kath |title=Clearing the Air |publisher=Climate Policy Initiative |date=September 2012 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2012/09/Clearing-the-Air.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{hobbs2012clearing, author = {Hobbs, Andrew and Rowley, Kath}, title = {{Clearing the Air}}, institution = {Climate Policy Initiative}, year = {2012}, month = sep, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2012/09/Clearing-the-Air.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }