A Balancing Act: Colorado Regulators Aim for a Healthy Environment and a Healthy Economy

In September 2023, the Colorado regulators approved the regulations that will help control emissions produced by some of the industrial manufacturers in the state. It took them two days of grueling debate before they finally decided what would be the new limit emissions these companies, which have been considered as big polluters, must adhere to.

Much like the Colorado emissions requirements for vehicles, the regulators aim to work with everyone to address competing concerns regarding the new regulations. They not only wanted to consider the public’s health and safety but also the state’s economic growth. This would explain why they took the companies’ concerns into account when approving the regulations considered to be the first of its kind.

The Greenhouse Gas and Energy Management for Manufacturing Phase 2

According to the Greenhouse Gas and Energy Management for Manufacturing Phase 2 or GEMM 2, the affected 18 manufacturers should cut their emissions by 2026 and diminish their greenhouse gasses by about 15.5% by 2030. If they are unable to reach near-term goals, they will face more strict regulations. 

Companies, including Molson Coors Beverage Co., Natural Soda, and Suncor Energy, had worked with the Colorado Chamber of Commerce to ask a few concessions be made to the GEMM 2’s severe rules. They worry that there will be possible production cutbacks and job losses due to them. They asked the regulators to delay the imposition of the first requirements for emissions-cutting for two years, to create a fund that manufacturers could pay for compliance, and to create an option for carbon capture as another way to reduce their emissions.

The approved new emissions limits

After a 5-2 vote, the Colorado Air Quality Control Commission supported the Air Pollution Control Division (ACPD) plan. However, several changes were made that favored the regulated facilities and the chamber. 

Under this plan, the following will be adhered to:

• Companies must first reach their reduction goals by doing onsite upgrades that are technically attainable and cost-effective at the rate of $89 or below per metric ton of pollution.
• Once the above has been exhausted, companies that are unable to reach their goals can purchase credits to be generated and put onto the market by the companies that have surpassed the requirements for their emissions reduction. 

Requested changes made by Colorado Chamber leaders

As mentioned, these regulations are first-of-its-kind; therefore, there is no assurance that the credit-trading system would actually work. The Colorado Chamber leaders then requested the creation of a greenhouse gas management fund wherein non-compliant facilities would end up paying fees that would finance projects promoting emissions reduction in impoverished and more polluted communities.

As of right now, the fund has not been created yet. However, the commission has ordered the APCD to have a plan regarding the fund by September 2025 and to implement it by 2026.

Environmental groups express concerns about the new regulations

The new regulations favoring the facilities and the chamber have raised the eyebrows of environmental groups. They shared their concerns, particularly about the credit market that allows facilities to pay if they fall short of reaching their emissions-reduction goals. They believe that it would open up loopholes that allow these manufacturers to “pay to pollute.”

The director of state legislative and regulatory affairs for the Environmental Defense Fund, Alex DeGolia, stated that there is a possibility for the emission levels to be increased over a short period, resulting in more burdens for the communities the new regulations wish to protect. 

DeGolia added that the regulators made a weak ruling, allowing the biggest industrial polluters in the state to increase their emissions by 2030.

Twin goals for the environment and the economy

On the other hand, the attorney for the Cargill beef-processing plant in Fort Morgan and the former Colorado Air Pollutant Division deputy director, Chris Colclasure, pointed out that the regulators should also consider the possible economic harms that could be brought about by the regulations. He added, “The answer to this rule is to present the twin goals of a healthy environment and a healthy economy.”

Commissioner Bill Gonzalez affirmed that they found the fears expressed by the facilities to be warranted. He said that their aim is to decrease emissions in more attainable ways.