CapitolInside the dome of the U.S. Capitol Building, Washington, D.C.Photo: O PalssonThe crystal balls of carbon policy are working overtime to interpret the results of the midterm elections. Fossil fuel providers have been gleeful as most soothsayers suggest a cloudy future for clean energy, energy independence, and any progress on reducing carbon pollution. Oil and coal companies helped elect a Congress more hostile to those sustainable energy solutions, but at least three oracles offer a different vision for our carbon-powered Congress to follow that may result in more jobs and a faster economic recovery.

First, there are the 10 northeastern states that are approaching the three-year anniversary of a carbon cap-and-trade program covering power plants (the major source of carbon pollution in the region). The Regional Greenhouse Gas Initiative (RGGI) has provided $729 million in revenues to its member state governments, most of it helping ratepayers become more energy efficient, thereby saving money and creating local jobs for things like insulating homes and replacing inefficient boilers or lighting. The money has also created new businesses that are installing solar panels, for example, putting roofing contractors back to work after the precipitous decline in construction.

Another strong reason that RGGI has enjoyed continued bipartisan support is that some of those funds are helping beleaguered governors balance tight state budgets. New Jersey used $65 million of its RGGI proceeds and New York $90 million to keep public safety workers and teachers employed, for example, while carbon pollution declined nearly 20 percent and energy bills rose imperceptibly. RGGI is being copied in other parts of the country for launch in 2012 and even a carbon-powered Congress could study both its results and the attendant politics for practical ways to clear the air and stimulate sustainable economic development.

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The second source of carbon insight comes from California, where Proposition 23, a measure to roll back carbon pollution limits that was funded primarily by two Texas oil companies, was soundly defeated at the polls. If the equivalent of Prop 23 had been on a ballot 100 years ago, it would have been funded by the horse and buggy manufacturers, but defeated by the emerging entrepreneurs of motorcars. In 2010, it was the clean tech industry that funded the defeat of Prop 23 in the clearest example to date of where the economic future of America could be — if we don’t wait while China or Germany race ahead of us to the global market for these new products and services.

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The final carbon signpost worth note is a summit that will take place in California next week — the Governors’ Global Climate Summit 3 (doesn’t everyone love a sequel starring Arnold Schwarzenegger?). Nearly 100 regional governments from around the world, in partnership with the U.N., will announce the formation of the R20, a global public-private partnership dedicated to commercializing sustainable economic development that reduces carbon pollution and other waste, replaces dependence on fossil fuels with unlimited clean renewable energy sources, and creates global markets for these new technologies.

The theme of all three of these oracles is that states and other sub-national governments are finding ways to cut carbon pollution while growing their economies, a dramatic difference from the debate in Congress about whether climate change is real or really worth addressing. At least one federal validation of this regional approach came this week from the EPA, which issued new guidelines that require states to regulate carbon emissions from large industrial facilities beginning early in 2011.

As the world turns its attention to the climate treaty meetings in Cancun in December and a new Congress in January, it may be more productive to peer into the crystal balls of the states and their international counterparts for insights into the real carbon action and more hopeful economic indicators for the future.

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