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Linking Subnational Climate Change Policies: A Commentary on the California–Acre Process

Published online by Cambridge University Press:  06 May 2015

Ernesto Roessing Neto*
Institute for European Studies (IES), Vrije Universiteit Brussel (VUB), Brussels (Belgium) and Universidade do Estado do Amazonas (UEA), Manaus (Brazil). Email:


Climate change is a global environmental problem which has been addressed primarily at the multilateral level. However, national, supranational, and even subnational action on the issue has also sprung up. At the subnational level, California (United States) and Acre (Brazil) offer an interesting example of how domestic policies may be linked in order to address climate change. Based on a memorandum of understanding concluded in 2010, these two states have been working towards the possible linkage of their respective climate change policies, in essence providing a pathway for using emissions offset credits that are generated in Acre through reductions of forest-based emissions in the Californian cap-and-trade programme. Taking into account that this is an ongoing process, this commentary provides a general overview of the issue from the perspective of international law.

© Cambridge University Press 2015 

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Research financed by CNPq, Brazil, grant # 201006/2012-0. The author would like to thank Sebastian Oberthür (IES-VUB) for reading and providing comments on a pre-submission version of this work.


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5 California Air Resources Board (CARB), ‘Air Resources Board Sets Date for Linking Cap-and-Trade Program with Québec’, News Release #13-18, Sacramento, CA (US), 19 Apr. 2013, available at:

6 The GCF is a coalition of subnational jurisdictions which includes members from the US, Brazil, Indonesia, Mexico, Nigeria, Spain and Peru. It was established in 2008, with the initial objective of working collaboratively for the design of rules that could lead to the inclusion of REDD activities in greenhouse gas (GHG) cap-and-trade mechanisms: see Joint Action Plan – Appendices, Aug. 2009, p. 1, available at:

7 The text of the MOU (signed in 2010) is no longer available at the Government of California official website. An unofficial version can still be accessed at the website of Brazilian NGO Instituto Socioambiental: see Memorandum of Understanding on Environmental Cooperation between the State of Acre of the Federative Republic of Brazil, the State of Chiapas of the United Mexican States, and the State of California of the United States of America, Davis, CA (US), 16 Nov. 2010, available at: See also Arup, C. & Zhang, H., ‘ Lessons from Regulating Carbon Offset Markets’ (2014) 4(1) Transnational Environmental Law, pp. 69–100Google Scholar, at 92–3.

8 Schreurs, n. 2 above, at pp. 346–7.

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13 In 1988, California instructed its Energy Commission to assess the likely impacts of climate change on its economy, energy and water supplies. In 2000, it established the California Climate Action Registry to encourage early action on climate change mitigation by establishing baselines and recording voluntary GHG emissions reductions. Furthermore, in 2002, the state enacted legislation that established limits for the GHG emissions from vehicles: see California, Senate Bill No. 1771 2000, ss. 42810 and 42820. See also Mazmanian, D.A., Jurewitz, J. & Nelson, H., ‘California’s Climate Change Policy: The Case of a Subnational State Actor Tackling a Global Challenge’ (2008) 17(4) The Journal of Environment & Development, pp. 401–423CrossRefGoogle Scholar, at 402 and 404.

14 California, Executive Order S-3-05 2005, s. 1.

15 California, Health and Safety Code 2013, s. 38550.

16 Ibid., s. 38551(b)–(c).

17 California Code of Regulations 2015, s. 95840.

18 California Health and Safety Code, n 15 above, ss. 95820, 95821, 95941–43, 95990–95.

19 ‘Allowance’ is defined as ‘a limited tradable authorization to emit up to one metric ton of carbon dioxide equivalent’ (CO2-e): see California, Code of Regulations 2015, n 17 above, s. 95802(a)(8).

20 An offset represents ‘a GHG reduction or GHG removal enhancement of one metric ton of CO2-e’: ibid., s. 95802(a)(12).

21 Ibid., s. 95943.

22 Ibid.

23 Ibid., s. 95821(d).

24 Ibid., s. 95993.

25 Decision 1/CP.18, Agreed Outcome pursuant to the Bali Action Plan, UN Doc. FCCC/CP/2012/8/Add.1, 28 Feb. 2013, para. II(C), available at:

26 New York, NY (US), 9 May 1992, in force 21 Mar. 1994, available at:

27 Pistorius, T., ‘From RED to REDD+: The Evolution of a Forest-based Mitigation Approach for Developing Countries’ (2012) 4(6) Current Opinion in Environmental Sustainability, pp. 638–645CrossRefGoogle Scholar, at 640.

28 Ibid.

29 Ibid.

30 Decision 1/CP.18, n. 25 above, at para. 25.

31 Offset credits are issued based on the difference between the actual GHG emissions registered after investment has been made in a supposedly emissions reducing activity, and the projected business-as-usual GHG emissions that would reasonably be expected in the absence of this activity. In the case of REDD, therefore, the credits would be generated based on the difference between the business-as-usual forest emissions scenario and the actual (reduced) forest emissions. Thus, in a scenario in which it was reasonable to assume a 20% increase in deforestation, offsets would be generated if it rose less than that or if it decreased; similarly, in a scenario in which deforestation was expected to decrease by 10% under business-as-usual, offsets would be generated if deforestation decreased more than 10%: see S. De Gryze & L. Durschinger, ‘An Integrated REDD Offset Program (IREDD) for Nesting Projects under Jurisdictional Accounting’, Terra Global Capital LLC, Nov. 2010, pp. 28–36, available at:

32 Haug, C. & Gupta, J., ‘The Emergence of REDD on the Global Policy Agenda’ in J. Gupta, N. van der Grijp & O. Kuik (eds), Climate Change, Forests and REDD: Lessons for Institutional Design (Routledge, 2012), pp. 7798Google Scholar, at 86.

33 Ibid.

34 Ibid., at pp. 87–8.

35 Ibid.

36 Australia’s mixed results from its deforestation reduction efforts show that this can be a challenge even to developed countries: see A. Macintosh, ‘Reducing Emissions from Deforestation and Forest Degradation in Developing Countries: A Cautionary Tale from Australia’, Policy Brief 12, The Australia Institute, Apr. 2010, pp. 7–12, available at:

37 Karsenty, A. & Ongolo, S., ‘Can “Fragile States” Decide to Reduce Their Deforestation? The Inappropriate Use of the Theory of Incentives with Respect to the REDD Mechanism’ (2012) 18 Forest Policy and Economics, pp. 38–45CrossRefGoogle Scholar, at 39–43.

38 Movius, D., Elias, P., Davis, S. & Ogonowski, M., Application of International REDD Agreements to California’s REDD Offset Program (Center for Clean Air Policy, 2012), p. 3Google Scholar.

39 Keck, n. 9 above, at pp. 417–20.

40 A. Anderson et al., O Sistema de Incentivos por Serviços Ambientais do Estado do Acre, Brasil: Lições para Políticas, Programas e Estratégias de REDD Jurisdicional (WWF-Brasil, 2013), p. 15.

41 Alencar, A. et al., Rumo ao REDD+ Jurisdicional: Pesquisa, Análises e Recomendações ao Programa de Incentivos aos Serviços Ambientais do Acre (ISA Carbono) (IPAM, 2012), p. 15Google Scholar, available at:

42 F. de M. Pinheiro, ‘A Invenção da Florestania’, conference paper presented at the Congresso de Ciências da Comunicação na Região Sudeste, Rio de Janeiro (Brazil), 7–9 May 2009, p. 2, available at:

43 Ibid., at pp. 2–3.

44 Keck, n. 9 above, at p. 416.

45 As evidence of this, only a few years later in June 1992, Brazil hosted the United Nations Conference on Environment and Development (UNCED).

46 Florestania is a neologism combining the Portuguese words for forest (floresta) and citizenship (cidadania), and is a term that has been widely used by the Acre government since 1998 as a way of communicating the idea of a government focused on sustainable forestry and the well-being of forest dwellers and forest-dependent peoples: see Pinheiro, n. 42 above, at pp. 3–4.

47 The Florestania movement has produced important figures in the Brazilian national political landscape, notably former Senator and Brazilian Minister for Environment Marina Silva (who ran for President in 2010 and 2014, receiving around 20% of the votes on both occasions).

48 Anderson et al., n. 40 above, at p. 37.

49 Acre, Lei Estadual N. 2308, de 22 de Outubro de 2010 (unofficial English translation) 2010, Arts 1 and 3.

50 Ibid., Arts 20–28.

51 Ibid., Arts 7 and 12–15.

52 Anderson et al., n. 40 above, at p. 46. See also Gandra, A., ‘Rio, Acre e BNDES Assinam Acordo para Agilizar Mercado de Ativos Ambientais’, Portal EBC, Brasília (Brazil), 19 Apr. 2013Google Scholar, available at:

53 KfW, ‘KfW Rewards Successful Forest Conservation’, news release, Frankfurt am Main (Germany), 5 Feb. 2013, available at:

54 Electric Power Research Institute (EPRI), Overview of Subnational Programs to REDD as Part of the Governors’ Climate and Forests Task Force (EPRI, 2012), p. xiv.

55 Duchelle, A.E. et al., ‘Chapter 2 – Acre’s State System of Incentives for Environmental Services (SISA), Brazil’, in E.O. Sills et al. (eds), REDD+ On the Ground: A Case Book of Subnational Initiatives Across the Globe (Centre for International Forestry Research (CIFOR), 2014), p. 48Google Scholar, available at:

56 Johnson, E. et al., California, Acre and Chiapas: Partnering to Reduce Emissions from Tropical Deforestation (2013)Google Scholar, available at:

57 Ibid., at pp. 19–59.

58 J. Lueders et al., ‘The California REDD+ Experience: The Ongoing Political History of California’s Initiative to Include Jurisdictional REDD+ Offsets within Its Cap-and-Trade System’, Center for Global Development Working Paper 386, Nov. 2014, p. 22, available at:

59 Milani, C.R.S. & Ribeiro, M.C.M., ‘International Relations and the Paradiplomacy of Brazilian Cities: Crafting the Concept of Local International Management’ (2011) 8 BAR-Brazilian Administration Review, pp. 21–36CrossRefGoogle Scholar, at 24. See also Setzer, J., ‘ Testing the Boundaries of Subnational Diplomacy: The International Climate Action of Local and Regional Governments’ (2015) 4(2) Transnational Environmental LawCrossRefGoogle Scholar (forthcoming).

60 Happaerts, S., van den Brande, K. & Bruyninckx, H., ‘Subnational Governments in Transnational Networks for Sustainable Development’ (2010) 11(4) International Environmental Agreements: Politics, Law and Economics, pp. 321–339Google Scholar, at 325 and 327.

61 Brazil, Constituição da República Federativa do Brasil 1988, Art. 21.I.

62 US, Constitution of the United States of America 1787, s. 10.

63 Johnson et al., n. 56 above, at pp. 54–5.

64 Lei Estadual N. 2308, n. 49 above, Arts 18(VIII) and 15(VII).

65 Johnson et al., n. 56 above, at p. 53. Also, it is interesting to note that in the case of an issuance and sales of early action credits to the German bank KfW, a letter of non-objection from the Brazilian national government has reportedly been requested by Acre: see ‘ROW Linkage Workshop, Part 2’, video recording, Los Angeles, CA (US), 5 Apr. 2013, 3:16:30–3:18:30, available at:

66 California Code of Regulations, n 17 above, ss. 95821(d) and 95991–5.

67 Ibid., s. 95943.

68 Ibid., s. 95854.

69 Ibid., s. 95983(1)(a).

70 Ibid., s. 95983(1)(b).

71 Ibid., s. 95983(c). Interestingly, the Californian regulation does not appear to provide a solution in the event of several unintentional reversals resulting in the insolvency of the Forest Buffer account.

72 Ibid., s. 95994(a)(3).

73 California, California Government Code 2013, s. 12894. See also Johnson et al., n. 56 above, at p. 54.

74 Lei Estadual N. 2308, n. 49 above, Art. 15(VII).

75 Paquin, S., ‘La paradiplomatie identitaire: Le Québec, la Catalogne et la Flandre en relations internationales’ (2004) 23(2–3) Politique et Sociétés, pp. 203–237CrossRefGoogle Scholar, at 204.

76 In Sept. 2013, California concluded an MOU with the Chinese National Development and Reform Commission. Regarding its relationship with federal policies, the Californian governor has stated that he has been in contact with the US Secretary of State and with the US President and that they were all ‘on board’, thus providing more indications of non-objection from the federal government to Californian international action on issues of climate change: see J. Garofoli, ‘California, China to Link Climate-Change Efforts’, SFGate, San Francisco, CA (US), 13 Sept. 2013, available at:

77 ROW Linkage Workshop, n. 65 above. at 3:16:30–3:18:30.

78 Joint statement issued at the conclusion of the 16th BASIC Ministerial meeting on climate change, Foz do Iguaçu (Brazil), 16 Sept. 2013, para. 12, available at:

79 The Brazilian national government, during the 20th COP, re-emphasized its stance against the use of offsets based on REDD, whereas some Brazilian states reportedly made it clear during the conference that they favour the use of offsets for financing REDD: see G. Resende, ‘Um Balanço da COP 20 – Entrevista com Maureen Santos’, Heinrich Böll Stiftung Brasil, Rio de Janeiro (Brazil), 21 Jan. 2015, available at:

80 The CDM was set up under the Kyoto Protocol to provide a cost-effective way for the developed world to offset GHG emissions: see Lederer, M., ‘From CDM to REDD+: What Do We Know for Setting Up Effective and Legitimate Carbon Governance?’ (2011) 70(11) Ecological Economics, pp. 1900–1907CrossRefGoogle Scholar, at 1900. See also Art. 12, Kyoto Protocol to the United Nations Framework Convention on Climate Change, Kyoto (Japan), 10 Dec. 1997, in force 16 Feb. 2005, available at:

81 Reforestation may be understood as the planting of trees on cleared lands that were covered by forests in the past. Afforestation is understood as the planting of trees on areas that were not previously covered by forests.

82 Pistorius, n. 27 above, at p. 639.

83 Fearnside, P.M., ‘Saving Tropical Forests as a Global Warming Countermeasure: An Issue that Divides the Environmental Movement’ (2001) 39(2) Ecological Economics, pp. 167–184CrossRefGoogle Scholar, at 171–4.

84 Ibid., at p. 171.

85 Fearnside, P.M., ‘What is at Stake for Brazilian Amazonia in the Climate Negotiations’ (2013) 118 Climatic Change, pp. 509–519CrossRefGoogle Scholar, at 511.

86 Carvalho, n. 4 above, at p. 156. See also Fearnside, n. 85 above, at p. 174.

87 Carvalho, n. 4 above, at pp. 156–63.

88 Joint Statement, n. 78 above, at para. 12. See also D. Chiaretti, ‘Varsóvia Avança em Decisão para Proteger as Florestas’, Valor Econômico, 22 Nov. 2013, available at: Moreover, see T. Krug, L. Guimarães & F. Ferreira, ‘O Marco de Varsóvia para REDD+’, Blog do Clima, 20 Feb. 2014, available at:

89 New York Declaration on Forests: Action Statements and Action Plans – Provisional Copy, New York, NY (US), 23 Sept. 2014, available at: See also ‘Leaders Pledge to End Deforestation by 2030’,, 24 Sept. 2014, available at:

90 Acre has received a visit by officials from the Canadian provinces of Québec and British Columbia, who came to ‘know the experiences of Acre in sustainable development and environmental services’: see S. de Carvalho, ‘Acre Recebe Comitiva Internacional da Força Tarefa dos Governadores para o Clima e Florestas (GCF)’, Agência de Notícias do Acre, 25 Sept. 2013, available at:

91 C2ES, ‘Comparison of the American Clean Energy Act of 2009 (Waxman-Markey) and the American Power Act (Kerry-Lieberman)’, Pew Center – Global Climate Change, June 2010, p. 10, available at:

92 H.A. Waxman and E.J. Markey, American Clean Energy and Security Act, HR 2454, 2009, s. 743(e).

93 Ibid., s. 743(e)(5).

94 S. Nicola & A. Vitelli, ‘Forest Carbon Won’t Be Tradable Commodity, Climate Expert Says’, Bloomberg, 14 June 2013, available at:

95 The Munden Project, ‘REDD and Forest Carbon: Market-Based Critique and Recommendations’, 7 Mar. 2011, available at:

96 ‘Key Global Stakeholders Sign Letters of Support for REDD+ in California’s Climate Policy’, Code REDD, 18 July 2013, available at:

97 Several organizations in California have argued that the use of REDD offsets by California would expose communities in California to more industrial emissions in the state, thus exposing them to greater environmental and health risks: see C. Lang, ‘Greenpeace, Friends of the Earth-US, Sierra Club California and 24 Other Environmental Organisations Oppose REDD Offsets in California’s Cap-and-Trade Scheme’, REDD Monitor, 6 May 2013, available at:

98 Conselho Indigenista Missionário (CIMI), ‘Dossiê Acre: o que os mercadores da natureza escondem’, 2012, pp. 17–8, available at: See also G. Gonzalez, ‘International REDD Faces Uphill Battle in California in 2014’, Ecosystem Marketplace, 8 Oct. 2013, available at:

99 Decision 1/CP.16, The Cancun Agreements: Outcome of the Work of the Ad Hoc Working Group on Long-term Cooperative Action under the Convention, UN DOC. FCCC/CP/2010/7/Add.1, para. 71, available at:

100 Decision 9/CP.19. Work Programme on Results-based Finance to Progress the Full Implementation of the Activities referred to in Decision 1/CP.16, Paragraph 70, UN Doc. FCCC/CP/2013/10/Add.1, para. 70, available at:

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