The Sierra Club warned that new regulations establishing a carbon trading regime include a giveaway to certain industries, pointing to allowances for emissions that were awarded at no cost rather than auctioned, as a state advisory committee had recommended. The plan also allows companies to purchase credits to avoid reducing pollution at their own facilities. Among the sellers of such credits will be timber companies that pledge to increase the carbon storage in forests, possibly by clear-cutting and planting new trees.
Sierra Club lobbyist Bill Magavern says oil companies would be the biggest beneficiary of the free allowance system. "The state will be giving oil companies valuable commodities for free, setting them up for windfall profits," he said.